(April 12, 2019) After months of negotiations, lease terms between Ocean City and the 67th Street Gym for the former World Gym property have been finalized, Ocean City officials reported this week.
City Council President Lloyd Martin on Tuesday provided details about closed session negotiations last month for the property at 107 67th Street.
“We now have an executed lease with the 67th Street Gym effective April 1, 2019 [and] terminating Dec. 31, 2019,” he said during Tuesday’s City Council work session.
Martin said the lease calls for $5,500 a month in rent for the building and $1,500 a month for 10 parking spaces.
In March, with pending lease negotiations still unresolved, Pete Brooks, former owner of the World Gym property, asked the council for, failing a rental agreement, at least sufficient time to relocate the operation.
Wells Fargo foreclosed on the property last year when it was owned by Brooks, who had operated the establishment under the business name Zeke’s World LLC, but filed for Chapter 11 bankruptcy protection in June 2016.
He reported liabilities of up to $10 million and no more than $500,000 in assets.
Following foreclosure, Brooks sold the business to Todd Clark and assumed the position of general manager at the 67th Street Gym.
In September, the council approved condemnation proceedings for 67th Street parcel, while days later the property was purchased at a foreclosure auction for $1.134 million by Wells Fargo Bank. The council voted in closed session on Nov. 5 to spend more than $1.2 million to buy the parcels at 107-109 67th Street for eventual use in the development of a new public works department complex.
In early February, Ocean City officials reported Wells Fargo served an eviction notice to Clark, but that was staved off when negotiations continued with the city weeks later.
On Tuesday, Martin reported the council voted 5-2 in closed session on March 12, with Councilmembers Mary Knight and Dennis Dare opposed, to send Clark a triple-net lease, which makes the tenant liable for any state or county real estate taxes.
The lease terms state the property is rented “where is-as-is,” with the tenant responsible for maintenance or repairs. Also, the tenant is required to put up an $11,000 non-interest-bearing deposit within two days of lease execution. The lessee can cancel the contract with 30-days’ notice.