Not understood]. And the other is the aging of the drydock. In looking at this lease and renewing it, we do take although factors in consideration in terms of the detail lease term that i will be going to in a minute. Here is a picture of the drydock number 2 which is [speaker not understood] capacity. This is the ship repair, another ship mentioned on drydock number 2. In starting to look at this lease, because current lease, bae currently has a lease with us that will be expiring in 2017 and it is mainly the port. [speaker not understood] in ~ 1994 [speaker not understood]. They want to include term in existing lease to be carried forward in the new lease. Likewise the port. The current lease has a base rent, there is a percentage rent. The current base rent is 1,050,000 a year. But it doesnt have a component to keep up with changing costs of living or inflation. The lease currently requires bae to continue to maintain the building and the equipment that belong to the port. However,
Couple of issues with respect to the [speaker not understood] in term of recouping the [speaker not understood] that the port made into it. Currently we are charging there is a surcharge of 4 cents per square foot that bae is supposed to [speaker not understood] through sfpuc to pass through to the port within the utilization of the [speaker not understood] system is not optimum so we are looking for an opportunity to enhance that so that the city so that the port could recoup reinvest. There is also an existing rent credit that was provided in the port princess crude and bae into an agreement whereby princess cruise said an Improvement Needed to be made to the drydock to service the ship when it come into San Francisco. Part of that deal was princess providing [speaker not understood] to bae and the improvement at that time was submitted to be between 5 to 6 million to which bae said, you know, the drydock is equipment that will need some assistance. So, the port provided a represent
Of Gross Revenue in the table and the staff report, you will see an indication that the base rent, the net rent to the port are the same under the current lease and the new lease. However, [speaker not understood] a higher minimum base rent to the port over the term of the lease. Where i indicated earlier, there is going to be a new yearly termination of the lease by the tenant. We want the tenant to be able to stay there for a minimum of ten years. At the edv of that ten years they have to provide the twoyear notice to terminate so that will give port the opportunity to issue an offering or look for tenant to take over the shipyard. As indicated before, there will be repair and maintenance to be enforced. Rent credit is being provided. There is an additional rent credit of 3 million to the existing 1. 2. All this is provided in details in the staff report. [speaker not understood] to allow for the redevelopment of pier 70. I believe the first portion that we will be taking back will b
Thank you, amy, and good afternoon, president katz, fellow commissioner. My name is phil williamson, senior project manager of the Port Development group. Here this afternoon before you with an e a amendment which i will in a little bit of detail and will be available afterwards to answer questions for you along with other members of our project team. Since executing a twophase exclusive negotiation agreement in september of 2010 for the development of seawall lot 337, also known as parking lot a and adjacent pier 48, [speaker not understood] llc, the port and the city staff have negotiated a nonbinding term sheet with pro poed financial term for the lease and development of the site. Last year along with the board the supervisor [speaker not understood] unanimously endorsed the term sheet which included phase 1 as the e a. A described in the term sheet, the port and developer have proposed a mixed use neighborhood for seawall lot 337 with appropriate height and density to create a vib
Tenants often require in the lease to say if things are not going the way they had planned or projected, [speaker not understood] they want an opportunity to help out. When the fifth amendment to the current lease was entered into in 2007, bae was not given the option to be able to [speaker not understood] not until january this year. So, that was a six and a quarter year from when that provision was provided. So were carrying forward the same term into the new lease because the new lease is going to be for 20 years. So, we are including an option, new yearly termination until 12 years into the new lease. Here are the proposed key terms of the new lease. The initial term is going to be for 20 years. With a probation for two fiveyear extensions. So, if they do exercise the two extension optionses, we will be looking at a total of 30year lease. The base rent now is being increased by 14 to 1,200,000 in 2015 as a way to enter the lease by the edv of this year. ~ end [speaker not understoo