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1 <br /> ORANGE COUNTY <br /> BOARD OF COMMISSIONERS <br /> ACTION AGENDA ITEM ABSTRACT <br /> Meeting Date: September 19, 2017 <br /> Action Agenda <br /> Item No. 8-d <br /> SUBJECT: 401 Valley Forge Road Property Lease Modification — Builders FirstSource <br /> DEPARTMENT: Asset Management Services, <br /> County Attorney <br /> ATTACHMENT(S): INFORMATION CONTACT: <br /> 1-Site Illustrative Jeff Thompson, 919-245-2658 <br /> 2-Lease Modification John Roberts, 919-245-2318 <br /> 3-Original Lease <br /> 4-Resolution <br /> PURPOSE: To consider: <br /> 1) approving a Lease Modification to Builders FirstSource that provides a 10 year <br /> lease extension with two 5 year renewal options for County owned property <br /> located at 401 Valley Forge Road, Hillsborough; and <br /> 2) authorizing the Chair to execute the Resolution for Lease and the Lease <br /> Modification upon final review of the County Attorney. <br /> BACKGROUND: In 1997, the County acquired property at 401 Valley Forge Road, <br /> Hillsborough (see Attachment 1, "Site Illustrative"), as a result of the retirement of revenue <br /> bonds owned by the Industrial Development Corporation. At that time, the Orange County <br /> Economic Development Office successfully negotiated an incentivized lease with Builder's <br /> Supply & Lumber, Inc. to invest in Orange County. The name was changed and the lease <br /> assigned to Builders FirstSource effective December 31, 2000. <br /> Builders FirstSource's initial investment continues to grow and thrive within the 105,000 square <br /> foot warehouse and distribution facility and surrounding grounds and provides significant <br /> economic development impact to Orange County. With this Lease modification, Builders <br /> FirstSource desires to continue the relationship with Orange County for an additional 10 year <br /> term with two 5-year renewal options (see Attachment 2, "Lease Modification", and Attachment <br /> 3, "Original Lease"). <br /> The rate for the first 10 year term is $2.80 per square foot and represents a competitive rate for <br /> similar properties within current market conditions gathered from local commercial real estate <br /> firms and the Orange County Economic Development Office. The rate provides consideration to <br /> Builders FirstSource and its responsibility within the Lease to replace the roofing system for the <br /> entire facility within the first three years of the Lease term. <br /> FINANCIAL IMPACT: The lease modification would yield $294,000 per year, or $2,940,000 <br /> over the life of the lease, effective October 1, 2017. As directed by the terms of the Lease, <br />