of the site, approved every year. at the discretion of the ports special director, requiring additional approval from the port commission. staff report mentioned that threshold a few days ago. >> thank you. promotional space within, if you are familiar with parking lot silage to tell you where your car is, it allows her car to be placed on that. subject to the rights of the port development partner, in may

of 2010 cuff the terms were negotiated for the development of the least into 2016. the dna contains language recognizing the lease and pork parking facility is not encumbered. a public bidding process to identify a new parking lot. staff recommends that the commission find it practical, because of the uncertainties presented by the developers rights presented by dna. staff receives to the board for direct approval of the new lease terms.

for a subsequent least of the site. thank you for your time and consideration. mr. jack bayer is in the audience as well. >> thank you. >> so moved. >> seconded. >> [laughter] >> look at this. >> representing the mission- missioncac on the transportation coordinating committee, we have

been neighbors of the ballpark. we along great. we do not always agree on everything. it has come to our attention that the mission they statement corp. is spending a fairly significant amount of money for us, $20,000 per year, in excess of normal thing that costs. the port parking lot lease has mitigation measures to be negotiated, initiative -- initially in 1997, going into

mission creep. of what the mission they make mince corp. considers their normal cleanup costs. how much should normally be reimbursed? we have not stop talking for 10 years. we think it is important for the neighborhood to not have to pick up these costs. >> is there any other public comment on this item?

>> you mentioned this in your report, and i wanted to clarify of $355,000 less? >> it is meant to mirror, that is right. operating something special at the park, whether or not there is a better way to find more

parking revenue, in terms of spaces to identify something of a special event. given that we have these different, fixed payments, is there a formula that can be identified so that there is a sharing of the fact that if there is more utilization during the low season, which is what we are addressing more so, understanding when the games aren't used. putting together uses in the neighborhood to cause high your utilization. i want to make sure that the port is thinking this through in and not losing out on opportunities, other than having to identify something special. >> i believe that negotiations with the giant recognizes that

it is the main benefit in shed a. we recognize that there could be overlapping uses where the parking lot is utilized. an event that needs to occur. we have worked out some language to make the port hole if there is a loss of revenue. >> i hope that there is something more specific than simply identifying special events as 14 days in duration. i want to make sure that there is a situation where the port shares, along with a look to the past.

looking at the upside, as well as being fixed and boxed in. >> my ability to generate revenue from these resources in these areas have probably enhanced revenue from that side alone. coordinating schedules to take advantage of opportunities as they come to the port. >> so that we do not feel that we missed out on an opportunity on behalf of the pork? >> especially with areas surrounding revoke licenses. >> commissioner? >> i guess, do it.

october, we are all assuming we will be back in the post-season. >> it would be nice. >> does this account for pending development around that area? changing some of the spaces available? and the usage there? >> we anticipate the parking for this site coming into more demand over the next several years. we are starting to see if you have been by there recently. there was more specificity as lots go way, two 23 years at the most. the potential for increased parking rates is something that we anticipate. >> an increased potential to be

reflected? >> yes. >> the base rent was set pretty high for the season. as the area develops, there is another point to your question. commuter use could grow. if that never goes up, they fled to support directly. >> i wanted to reflect on oracle world and the incredible sums paid for usage of areas. if something like that were to occur for a few days, it would trigger an increase. >> that would depend on the fed was a special event or not. plus parking.

>> thank you very much. all in favor? >> aye. >> resolution 1168 has been approved. >> item 11 a, request approval of eat -- and least l-14935 with horn blow or yachts, inc., a california corporation, for a five-year lease with 15-year extension, for premises located at pier 9 self. >> we propose this item for a lease with hornblower yachts. here nine is located on the northeast waterfront of the embarcadero.

it was previously occupied by signature diming. the site has been vacant since 2009. the majority of office space, formerly occupied by signature dining out, has been containing 1200 square feet of shed space, apron space, and 23,000 square feet of submerged land, to allow for a maritime retail opportunity. maritime retail opportunities of up to 10 years are exempted from the public bidding process. however, in this case, in order to thoroughly that the interests of the pier 9 site and make

sure that there is an open and transparent process, the court look for -- prospective tenants in a public process. way of 2010, the port issued a request for proposals for excursion vessel operations. we are f p had clear specifications posted on the report website forest -- excursion operators. the port held a conference in june of 2010. it received only one qualified response, which came from the hornblower yacht group.

they reached mutually acceptable terms and conditions for the proposed lease, outlined in the staff report. the proposed lease provides for an initial term of five years. with a minimum, monthly base rent of $5,400, plus 6% of gross revenues. adjusted annually by 3% for the remainder of the term. the lease grants for lower 160 month extension option. the base rent for the option. would be the prevailing market rate.

the permitted use is for vessel morning in passenger loading and unloading, consistent with the waterfront plan, as well as other state and federal requirements. police provides for a three month, rent-free space corp., consistent with the improved parameter rental policy. representing approximately $200,000 to install ramps, floats, morning systems, pilings, and wiring as required by the lease. it includes embarkation, demarcation, passenger transit,

maintenance, supplies and deliveries, storage in handling hazardous materials and security, and issues such as noise, recycling, litter control, vehicle traffic management, they are all addressed. this is an existing maritime tenant, paying the port approximately $1.9 billion in rent annually. it helps to support the ports maritime mission. this lease will provide the port with a guaranteed minimum rent of $64,700, annualized. the tenant will generate an additional $200,000 for your.

meaning that the port should earn approximately $1.4 million in revenue from this currently under-performing asset over the next five years. the city and the port of san francisco proposed the 34th america's cup in 2012 and 2013. they are in the process of conducting environmental review. the city planning department has issued a draft, environmental impact report that analyzes the potential environmental impact of the proposed events. the draft report includes a section on alternatives, identifying the atrium and the waterway on the southwest side of your nine -- pier 9 for the

race events in 2013. should this alternative be ultimately selected, for lower would be asked to agree to a lease amendment to accommodate the temporary burden and public access. having received a letter from the ceo and president of hornblower, they said they would adhere to the festivities associated with the america's cup, working closely with the port and america's cup organization, providing more space than any of their lease basis consistent with ongoing operations. in conclusion, staff recommends that the commission approved the

lease with horned lower yachts inc.. thank you for your consideration of this item, commissioner. >> so move. can i have a second? is there a second? >> ok. >> question, question. robert? >> emotion and a second, let's take comment. >> questions? >> yes, you can do questions.

>> it is a problem and terry -- problematic situation. ideally, you would want the motion on the floor. >> i have the same concern that i expressed with the previous item. we have an issue looming out there. i am not sure why we are entering into something that we would have to go back to in a few months. in a few months, we would know where we stood. that is my concern.

>> with commissioner lazaristust is very permissive that there would be negotiations. who would benefit? that is a significant charge from the event authority. they have a number of other concerns as to about that would work and might cause significant readjustment. >> the reason i did not raise questions was because i differed from the previous ones. hornblower seemed aware that we would be entering into negotiations with the america's cup. if they are, as i understood

it, willing in agreement to accommodate -- i guess that is the only reason. it seemed like the term would stand, knowing that they would have to delay. >> i just want to clarify whthat the city bears the cost without rental. >> is there anyone here to discuss this that represents hornblower bella >> the public should be allowed to comment on the matter. if someone can inform -- if someone who was informed would like to comment on the matter?

>> commissioners, a good afternoon. i am the planning and development leader. the newest member of our team, we would like to introduce her. we were fortunate enough to bring her in to the company as a long-term tenant at the port of san francisco. without jeff and peter, we would not be here today. we have looked at the diagrams that are in the eir for the paradigm alternative. the leasehold area is not within that alternative diagram.

public access, we can accommodate that. allowing public access them on the apron. to us, we are very excited about the america's cup. we want to do everything we can to facilitate a successful operation. we would be glad to provide additional information. >> the uncertainty does not bother you as far as the understanding at the moment? >> we are willing to accommodate whatever you need across the premises. the issue, i think, is public access. we can change and modify the gate. >> your use of this is

displacing the other use of the port? >> we would certainly like to expand our business. we have other products that we would like to introduce. we are also ready to begin the substructure repair work at pier 3. we believe that facilities would allow us to move growth away, so that the contractor can get to the substructure areas and allow us to continue to operate pier 9. >> thank you very much. >> thank you for your time.

>> i am the regional director. i just wanted to echo some of the things that we heard earlier. particularly when we talk about existing tenants moving into the america's cup. we have worked very hard with the port and the mayor's office, which is near and dear to us. we are having trouble with the fact that we have some space that can potentially be used however we need. we are talking about potentially existing in that space at the potential expense of other existing tenants. we would hope, at the end of the day, that it would be put off.

on behalf of the san francisco labor counsel, who recently paid a significant fine for not complying with the health care ordinance, we have a member whose case is still pending before the human rights commission. >> thank you. veronica sanchez? >> good afternoon. the staff has done a very thorough job.

certainly, there is the opportunity for the poor, with this lease. we applaud that and are supportive of financial integrity. i think that where the staff report does not provide answers, there are questions to be s about whether this tenant is in good standing. not just talking about financial terms, but the tenant is maintaining and repairing facilities at other locations. that is definitely a question worth asking. also, the bid as a criteria set as a requirement for a successful venture, maybe it might be good to ask what other

ventures have been done and what the method of delivery is. it was interesting that in the company's letter to you, structure worked at pier 3. we are talking about a safety issue there. we were asked to yellow tag appear with 10 ton trucks to go through. periodically, as needed to fuel the trucks there, it went on through march of