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AUTHORIZATION TO TERMINATE AIRPORT LEASE AND DEVELOPMENT AGREEMENT
Staff Contact: Jack Friedline, Director, Public Works
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Purpose and Recommended Action
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This is a request for City Council to waive reading beyond the title and adopt a resolution authorizing the City Manager to terminate the 2007 Glendale Municipal Airport land lease and development agreement between the city and Enterprise Bank, in accordance with the August 2011 lease amendment.
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Background
In August 2007, the city entered into a land lease agreement with Rightpath Limited Development Group, LLC (Rightpath) for their development of approximately 134 acres on the east side of the Glendale Municipal Airport. Rightpath encountered financial difficulties and defaulted on their bank loans from the First National Bank of Olathe (FNBO) and payments to the city for a separate lease of the fixed base operator airport facility. The May 2010 bank default also included the eastside ground lease, as the lease was used as collateral by Rightpath.
In October 2010, Council approved an agreement with the FNBO for the interim operation of the airport fixed base operator and directed the City Manager to execute any necessary amendments to the land lease development agreement.
On August 1, 2011, the city entered into an amendment and assignment of the 2007 land and development lease with Corporate Holdings II, LLC, Rightpath's successor-in-interest, and the FNBO, Corporate Holdings' managing member. The 2011 lease amendment included a reversion date, giving the city the option to terminate the agreement on or after August 1, 2014. In August 2011, the FNBO failed, and its assets were sold to Enterprise Bank and Trust, which became the final successor-in-interest to the airport land lease.
In early 2013, Enterprise Bank's legal counsel notified the city of their intent to hold a trustee's sale and public auction of the airport land lease. City legal staff submitted commen...
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