Broward County Commission Regular Meeting
Director's Name: Glenn Wiltshire (Acting Director)
Department: Port Everglades Division: Business Development
Information
Requested Action
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MOTION TO APPROVE Consent to Sublease between Broward County, as Landlord, Horizon Terminal Services LLC, as Lessee and Sublessor, and Rehoboth Terminal LLC, as Sublessee, for a portion of the premises leased from Broward County to Horizon Terminal Services LLC at Port Everglades pursuant to a Marine Terminal Lease and Operating Agreement dated January 29, 2018, as amended; and authorize the Mayor and Clerk to execute same.
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Why Action is Necessary
Broward County Board of County Commissioners’ consent is required for any sublease pursuant to Section 15 of the Marine Terminal Lease and Operating Agreement.
What Action Accomplishes
Approves Consent to Sublease between Broward County, as Landlord, Horizon Terminal Services LLC, as Lessee and Sublessor, and Rehoboth Terminal LLC, as Sublessee, for a portion of the premises leased from Broward County to Horizon Terminal Services LLC at Portt Everglades.
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Previous Action Taken
None.
Summary Explanation/Background
THE PORT EVERGLADES DEPARTMENT RECOMMENDS APPROVAL.
This action supports the Broward County Board of County Commissioners’ (“Board”) Value of “Building partnerships and working collaboratively with others to meet shared objectives,” and the Goal of “Ensuring economic opportunities and a sustainable economy, with an emphasis on Broward’s lower and middle class.”
On January 23, 2018 (Item No. 7), the Board approved a Marine Terminal Lease and Operating Agreement (“Marine Terminal Lease”) between Broward County and Horizon Terminal Services LLC (“Horizon”) for ±8.67 acres of land and 27,560 square feet of warehouse space in the Midport area of Port Everglades (see Exhibit 2) for a five-year term commencing retroactive to January 1, 2018. On December 1, 2020 (Item No. 11), the Board approved the First Amendment to the Marine Terminal Lease, amending certain business terms, including increasing the premises from ±8.67 acres to ±13.6 acres and extending the term by three years to a new expiration date of December 31, 2025.
In April 2024, Horizon approached Port staff requesting approval to sublease approximately five (5) acres of its leasehold to Rehoboth Terminal LLC, (“Rehoboth”) from May 22, 2024, through November 30, 2024 (“Sublease”). Rehoboth has been providing stevedoring and cargo handling services at Port Everglades since January 2020, and is currently operating from 6.9 acres of grid yard area in the Southport area of Port Everglades provided under the terms of Port Tariff Item No. 1140. In FY 2023, Rehoboth moved 16,977 units of cargo through the port, resulting in total revenue of $176.169, and FY 2024 activity through March 2024 is 12,024 units of cargo, resulting in total revenue of $126,407. Rehoboth requires additional land to accommodate the volume of cargo it anticipates moving through the port. Per the terms of the Marine Terminal Lease, Board consent is required for the Sublease.
Horizon is a tenant in good standing, with a current annual rent obligation of $881,485 and a Minimum Guaranteed Payment (“MGP”) of $401,098 for 46,098 units of cargo. Horizon will continue to be liable for meeting their MGP.
Based on a review of the information provided, staff has determined that, with the Sublease, Horizon will continue to meet the standards of creditworthiness, will have the ability to perform the obligations under the Marine Terminal Lease, and will use the premises in connection with the maritime industry for the purposes described in the Marine Terminal Lease.
The Consent to Sublease and associated documents have been reviewed and approved as to form by the Office of the County Attorney. The Consent to Sublease is still under final review by Horizon, and confirmation of receipt of signature pages will be included in the Monday Night Memo.
Source of Additional Information
Jorge A. Hernández, Director of Business Development, Port Everglades Department, (954) 468-3501
Josh Miller, Property Manager, Business Development Division, Port Everglades Department, (954) 468-3518
Fiscal Impact
Fiscal Impact/Cost Summary
There is no fiscal impact to Broward County.