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Res 16-12 Authorizing an Agreement Regarding Town Office SpaceTOWN OF WESTLAKE RESOLUTION 16-12 A RESOLUTION BY THE TOWN COUNCIL OF THE TOWN OF WESTLAKE, TEXAS, AUTHORIZING THE TOWN MANAGER TO EXECUTE A REPRESENTATION AGREEMENT FOR IDENTIFYING SUITABLE RELOCATION OFFICE SPACE, ANALYZING LEASE AND PURCHASE OPTIONS, AS WELL AS NEGOTIATING TERMS FOR TOWN OFFICE SPACE WITHIN SOLANA IN WESTLAKE. WHEREAS, the Town of Westlake is experiencing planned growth through the attraction of economic development projects such as Fidelity Investments and Deloitte University, as well as residential developments such as Vaquero, Glenwyck Farms, Terra Bella, Granada, and Entrada which are consistent with the Town's Comprehensive Plan, as well as enrollment growth at Westlake Academy, all of which contribute to demand for improvements to Westlake's infrastructure and public buildings, and WHEREAS, the Town of Westlake (Town) has identified its office space needs and requested proposals from qualified, real estate professionals to assist the Town in identifying suitable relocation office space, analyzing lease and purchase options, as well as negotiating terms for Town office space within Solana in Westlake. WHEREAS, the Town has analyzed these proposals and desires to enter into a professional services agreement for these services. WHEREAS, the Town Council finds that the passage of this Resolution is in the best interest of the citizens of Westlake. NOW, THEREFORE, BE IT RESOLVED BY THE TOWN COUNCIL OF THE TOWN OF WESTLAKE, TEXAS: SECTION 1: THAT, all matters stated in the Recitals hereinabove are found to be true and correct and are incorporated herein by reference as if copied in their entirety. SECTION 2: THAT, the Town Council of the Town of Westlake, Texas, hereby approves a Representation Agreement with Cushman & Wakefield attached to this resolution as Exhibit A. SECTION 3: THAT, the Town Council of the Town of Westlake further authorizes the Town Manager to execute said professional services agreement on behalf of the Town of Westlake. SECTION 4: If any portion of this Resolution shall, for any reason, be declared invalid by any court of competent jurisdiction, such invalidity shall not affect the remaining provisions Resolution 16-12 Page 1 of 2 hereof and the Council hereby determines that it would have adopted this Resolution without the invalid provision. SECTION 5: That this resolution shall become effective from and after its date of passage. PASSED AND APPROVED ON THIS 28TH DAY OF MARCH, 2016. ATTEST: ,.i Kelly)Edwa RMC, Town Secretary Laura Wheat, Mayor Thomas E. Brymer, Resolution 16-12 Page 2 of 2 REPRESENTATION AGREEMENT REPRESENTATION AGREEMENT Town of Westlake ("Client") appoints Cassidy Turley Commercial Real Estate Services, Inc. d/b/a Cushman & Wakefield, a Missouri corporation ("C&W") as its sole agent and grants to C&W the exclusive right to represent Client with respect to the acquisition of real property within the town limits of Westlake, Texas as provided below. 1. Term. The term of this agreement will commence on April 1, 2016 and will expire on March 31, 2017, subject to any extension mutually agreed to in writing by both parties. 2. Services. C&W will use its efforts to find, negotiate for and secure a location in the above geographic area satisfactory to Client during the term of this agreement. C&W will negotiate the business terms of any purchase and sale agreement, lease or sublease, as the case may be, on behalf of Client and in Client's best interests. C&W will cooperate with other licensed real estate brokers. Client acknowledges and agrees that C&W is not responsible to determine whether toxic or hazardous wastes or substances or other undesirable materials are present at any property that ultimately may be purchased or leased, and Client further acknowledges and agrees that it is solely Client's responsibility to conduct investigations to determine the presence of such materials. 3. Referrals. During the term of this agreement, Client will refer to C&W all inquiries and offers received by Client with respect to the acquisition of real property in the above geographic area, regardless of the source of such inquiries or offers. 4. Commission. If, during the term of this Agreement, Client acquires any interest in any property within the town limits of Westlake for the purposes of a "town hall" or similar use, then C&W shall earn a commission in accordance with the schedule of commission outlined in Exhibit "A" attached hereto (a "Full Commission"). With respect to a transaction as to which commissions are customarily paid by a third party pursuant to local custom, C&W shall use commercially reasonable efforts to have the third party pay any commissions due and payable for such brokerage services, and C&W shall be compensated from such third party. Client agrees to recognize and document C&W as its exclusive real estate broker, agent and representative with respect to Client's acquisition of real property as contemplated hereunder, and Client agrees to support C&W's request for payment from any such third party. In the event said third party refuses to pay C&W a Full Commission, then Client shall pay a Full Commission to C&W or pay C&W the difference between a Full Commission and the amount the third party pays or agrees to pay. The timing of payment of any such commission shall be in accordance with Exhibit "A" attached hereto. C&W agrees to promptly notify Client when any third party refuses to pay a Full Commission so that Client can decide if negotiations are to be pursued at that location. With respect to a transaction as to which commissions are not customarily paid by a third party (i.e., where local custom dictates otherwise), Client shall pay a Full Commissions to C&W. Subsequent to the expiration of this agreement, Client will continue to recognize C&W, for a period of twelve (12) months, as Client's exclusive broker, in accordance with the provisions hereof, with respect to any locations that have been submitted to Client during the term of the agreement. 5. Representation of Other Parties. Client acknowledges and agrees that C&W may represent potential sellers, landlords or sublandlords and consents to such dual representation, provided C&W timely discloses any such dual representation to Client. Client also understands that C&W may represent other parties interested in acquiring space or property that may be submitted to Client and Client consents to same. C&W will not disclose Client's confidential information to any of its other clients. 6. Protect Management Services. It is expressly acknowledged that this Agreement is for C&W's real estate brokerage services only, and C&W's other service lines, including without limitation, assets services, project management, and appraisal, are not a part of the scope of this Agreement. Notwithstanding the foregoing, Client will engage C&W pursuant to a mutually acceptable separate RES 16-12 CUSHMAN & WAKEFIELD 1 REPRESENTATION AGREEMENT agreement, for any and all project management services that may be necessary as a result of the transactions contemplated hereunder. 7. Fees and Expenses. If either party commences litigation against the other party to enforce its rights under this agreement, the prevailing party will be entitled to recover from the other party the costs and expenses (including reasonable attorneys' fees) incurred. 8. Authority. Client represents that it has the right to enter into this agreement and to consummate a transaction as contemplated herein. The individuals signing below represent that they are authorized to sign this agreement on behalf of the entity indicated. 9. Professional Advice. C&W recommends that Client obtain legal, tax or other professional advice relating to this agreement and the proposed purchase, lease or sublease, as the case may be, of real property as well as the condition and/or legality of any property, including, but not limited to, the property's improvements, equipment, soil, tenancies, title, environmental aspects and compliance with the Americans with Disabilities Act. C&W will have no obligation to investigate any such matters unless expressly otherwise agreed to in writing by Client and C&W. Client further agrees that in determining the financial soundness of any prospective seller, landlord or sublandlord, Client will rely solely upon Client's own investigation and evaluation, notwithstanding C&W's assistance in gathering any financial information. 10. OFAC. Each party represents and warrants to the other party that it, and all persons and entities owning (directly or indirectly) an ownership interest in it: (a) are not, and will not become, a person or entity with whom a party is restricted from doing business with under regulations of the Office of Foreign Asset Control ("OFAC") of the Department of the Treasury (including, but not limited to, those named on OFAC's Specially Designated and Blocked Persons list) or under any statute, executive order (including, but not limited to, the September 24, 2001, Executive Order 13224 Blocking Property and Prohibiting Transactions with Persons Who Commit, Threaten to Commit, or Support Terrorism), or other governmental action; and (b) are not knowingly engaged in, and will not knowingly engage in, any dealings or transactions or be otherwise associated with such persons or entities described in clause (a) above. 11. Miscellaneous. This agreement shall be governed by and interpreted in accordance with the laws of the State of Texas, without giving effect to principles of conflicts of law. This agreement constitutes the entire agreement between the parties regarding the subject matter herein, and no amendments, changes or modifications may be made to this agreement without the express written consent of each of the parties. If any term or provision of this agreement is held by a court of competent jurisdiction to be invalid, void or unenforceable, the remainder of the terms and provisions of the Agreement shall remain in full force and effect and shall in no way be affected, impaired or invalidated. No failure or delay by a party in exercising any right hereunder or any partial exercise thereof shall operate as a waiver thereof or prohibit any other or further exercise of any right hereunder. This agreement shall benefit and be binding upon the parties and their respective successors and assigns. This agreement may be executed and delivered (including by facsimile, "pdf" or other electronic transmission) in any number of counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same agreement. 12. Broker Regulatory or Statutory Provisions. AGENCY RELATIONSHIP DISCLOSURE: CLIENT ACKNOWLEDGES THAT C&W MAY REPRESENT POTENTIAL LANDLORDS, SUBLANDLORDS, OR SELLERS, AS THE CASE MAY BE, AND CLIENT HEREBY CONSENTS TO SUCH INTERMEDIARY REPRESENTATION. As a real estate broker who acts as an intermediary in a transaction, C&W (i) shall treat all parties honestly; (ii) may not disclose that the landlord, sublandlord or seller, as the case may be, will accept a price less than the asking price unless authorized in writing to do so by the landlord, sublandlord or seller, as the case may be; (iii) may not disclose that the tenant, subtenant or purchaser, as the case may be, will pay a price greater CUSHMAN & WAKEFIELD 2 REPRESENTATION AGREEMENT than the price submitted unless authorized in writing to do so by the tenant, subtenant or purchaser, as the case may be; and (iv) may not disclose any confidential information or any information that a party specifically instructs C&W in writing not to disclose unless authorized in writing to disclose the information or required to do so by the Texas Real Estate License Act or by a court order or if the information materially relates to the condition of the real property. TOWN OF WESTLAKE Title: \ / vTh' ? naC Date: ' ._.,, 2q - (47 Resolution 16-12 CASSIDY TURLEY COMMERCIAL REAL ESTA ERVI S, INC. D/B/A CUSHMAN & SSOURI CORPORATION Name: Title: Date: CUSHMAN & WAKEFIELD 3 REPRESENTATION AGREEMENT EXHIBIT A FEE SCHEDULE TRANSACTION MANAGEMENT / BROKERAGE LEASE Four and one-half percent (4.5%) commission. This commission shall be based on the gross rent payable by the tenant over the term of the lease. By way of example: Rate Schedule - Sample Calculation 20,000 RSF x $25.00/RSF/Yr x 7 Yrs = $3,500,000 $3,500,000 x 4.5% = $157,500 Sample fee to be collected by C&W Commissions on lease or sublease transactions (including renewals, extensions and expansions) shall be payable fifty percent (50%) upon on the execution and delivery of the applicable lease, sublease or amendment and fifty percent (50%) upon commencement of the lease or sublease term. PURCHASE Three percent (3%) of the total gross purchase price, which shall include any mortgages, loans or other obligations of seller which may be assumed by purchaser or which purchaser takes title "subject to," and any purchase money bans or mortgages taken back by seller. By way of example: 20,000 SF x $200/SF = $4,000,000 purchase price 3% x $4,000,000 = $120,000 Sample fee to be collected by C&W Commissions on sales transactions shall be payable in full upon the earlier of either closing of title or escrow or, in the case of an installment sale, upon execution and delivery of the installment sale contract. BUILD TO SUIT / DEVELOPED BUILDING The fee shall be based on an inputted rental rate using a yield on cost formula (using 9%) based on the total project costs to construct the building and a 7 year lease term. By way of example: 20,000 SF x $350/SF = $7,000,000 total project costs $350/SF x 9% = $31.50 NNN Base Rate $31.50 Base Rent + $7.00/SF Operating Expense Assumption = $38.50/SF Gross Rental Rate 20,000 SF x $38.50/SF x 7 years = $5,390,000 Gross Consideration 4.5% x $5,390,000 = $242,550 Sample fee to be collected by C&W CUSHMAN & WAKEFIELD 4