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Another alternative would involve the City purchasing the current project from Mr. <br />Keech and using the proceeds from the childcare center lease to offset the branch <br />library's operating costs. Staff has had preliminary discussions with Mr. Keech <br />concerning this alternative. Unfortunately, this conversation occurred very recently <br />and we do not have a great deal of detailed information to share with you other than <br />the cost to construct the entire building would be about $6.7 million (excluding <br />furnishings for the library) and that the childcare lease could generate about <br />$250,000 per year in net lease revenue for the City. <br /> <br />Fiscal Impacts <br />Except for the $3.2 million Promissory Note to Shores Childcare, LLC, there would <br />be no direct disbursement of City funds to develop this project as a result of these <br />changes, other than relatively minor consultant and/or legal fees. Nor is any future <br />disbursement of funds expected during the term of the Note. Depending upon the <br />future demand for commercial office space and the attendant rental rates, the City <br />will likely realize revenues from the rents generated by the 8,000 square feet of <br />Commercial office space located on the second floor of this facility. <br /> <br /> /' <br /> <br /> · <br /> <br /> Edwar <br />Brian Ponty <br />Director of Finance and City Manager <br />Financial Planning <br /> <br />Attachment <br />First Amendment to Ground Lease <br /> <br /> Page 7 of 7 <br /> <br /> <br />