Court won't interfere in contested city lease

The company that wants to purchase the building housing the city of Las Vegas' planning and developmental services office can do so, but it will have to be without a court determination about the city's lease rights.

District Judge Mark Gibbons ruled Monday that until United Municipal Leasing Corp. actually purchases the building at 731 S. Fourth St. it does not have the legal right to sue over provisions of the lease. United must first buy the property and then sue or have the existing owner, 730 Ltd., fight the battle for it.

United's senior vice president Arnold Kramer said after the brief hearing that the company still intends to go ahead with the purchase, but the demand for a court ruling adds a new wrinkle that may jeopardize the deal.

The city of Las Vegas decided to play hardball with the potential future owner earlier this month and withdrew its challenge to United's bid for the building.

The city's newly hired private attorney Todd Bice has said the city didn't believe United has the money to close the sale.

"We're calling their bluff," Bice said.

If United buys the property, it believes a new lease must be negotiated or the city can be told to leave.

The city has been leasing the building for 2 1/2 years and spent $1.5 million to renovate it -- money that can't be recovered if the city is kicked out.

United attorney Matt Callister has maintained the ultimate issue for Gibbons will be whether the existing lease -- which has eight years to run -- is binding.

Kramer has maintained the lease the city currently has with the owner, Dave Mason, is one that doesn't allow for the lease to continue if the building is sold.

Kramer has offered the city a 20-year lease that would have allowed the city to buy the building for $1 after the term was up. The city attorney's office opted to decline the offer, saying that the lease was too long and could affect their bond rating.

archive