to thank the giants for bringing the first client to the project. i am sorry that i missed it and it is exciting that it is moving to pier 48 and i would like to congratulate the staff on the new cruise terminal and i think that it is phenomenal and after 20 years of trying we finally got it right and did it ourselves and so the staff should be very proud of this effort and everybody working together is just wonderful and to come in on time, well, a few days early. and within budget, is just wonderful. so congratulations. and i wanted to echo those same comments, regarding the cruise ship terminal and i was fortunate to have john, the guy that gave me an increased appreciation of all that was done by the staff to really make it a reality. but to your point, monique, the take credit to where the credit

is due. you deserve the credit for shepherding a phenomenal team for making this happen. thank you for making it a reality and we could not have asked for a more spectacular for the ribbon cutting. my own concern is that they have too many people coming off the cruise ships wanting to move to san francisco. >> i already made public comments earlier at the press conference and i want to thank her and the staff and all of the departments that have worked on this and it is quite amazing and i think that we are impressed and i wasn't here when the commission debated this years ago. but the perseverance of all of the parties is just incredible and it is going to speak to what we are doing and all of the projects on the water front and we are going to continue with that determination and vision, and we are going to make it happen. and so we are very excited to see that this one is at least this will be... at least this is the first one in i could say

under my term that i have seen, so i know there are many more to come and i am excited about that and again, thank you. >> commissioners, the item has been taken off, 9 a request authorization subject to board of sperp's approval to accept and expend $300,000 of the $919,243 grant from port wide cctv resolution 13-03 and the entire $403,510 for pier 80 security improvements in 2011 infrainstruct stur protection program, port security grant program funds from the u.s. department of homeland security for security improvements of the port of san francisco. resolution number 1 3-04. >> item 9 c, requests authorization to execute modification, to contract number 2757 pier 50 valley, substructure repair with west bay builders ink to extend the

original contract duration of 240 days by an additional 71 days. item 9 d request approval for the port's supplemental appropriation in the biennial operating budget and capitol budget for fiscal year 2012-13 and 2013-14. >> moved. >> second. >> is there any public comment in >> hearing, none, all of those in favor? >> aye. >> resolution, number 1 504, resolution, 1506, and 1507 have been approved. >> and 1303 as well? >> number 9 a, two resolutions. >> i am sorry. i apologize. >> thank you. there is a correction, counsel. >> item 1 a request approval of first amendment to lease no

l1502 with cobouchon properties llc a california limited liability company located at pier 9 to provide and it should be maximum of $100,000 in rent credits for core and shell improvements. >> good afternoon, commissioners, jeffrey the port leasing manager, asking your approval for the properties. previously it was located at suite 114, they had been a tenant for almost ten years at that site. following negotiations with auto desk, for a parcel expansion, they voluntarily agreed to move to another office which was fortunately availabled suite 105 at pier 9. and the lease does allow the port to relocate them but to a similar office, simply improved port staff was able to

negotiate with the auto desk a payment directly to cabacohon for $225,000 to make the improvements to suite 105. following a more destructive investigation of suite 105, several unforeseen conditions came to light that requires an additional $100,000 in core, and shell improvements to the suite. if approved, the credit would be deducted per month of $17554, the port would then receive $3861 net rent. we believe that the development of the auto desk of $225,000 in combination with the $100,000 is a direct benefit to the port and greatly enhances pier 9. it should be noted that they had two years on their lease. i knocked on the door and told them that we wanted to

terminate their lease. they were willing to do so. they did not have to necessarily be as cooperative as they were. in suite 105, currently camping out in a storage area which is on the second floor while their space is being built out below them. so they have been very cooperative tenant. they are a tenant in good standing. and i ask for your approval of the first amendment to the lease number l15202. that concludes my report. >> so moved. >> second. >> is there any public comment? >> commissioners, any questions? >> hearing none, all of those in favor? >> aye. >> item 11 a informational presentation of the term sheet between the port and the sea wall lot 337 associates llc for the mixed use development of

sea wall lot 337 and pier 48 bounded by china basin channel and third street and mission rock street and san francisco bay and adjacent to at&t park. >> good afternoon, commissioners, phil williamson, the manager for 337 and pier 48. i just want to give you an overview of what you will hear over the next half hour and i am here to introduce the program and the first speaker will be mike martin from the office of workforce department and his office is rolling this project and i will talk you through and walk you through the components of the term sheet and johnson's turn to come up and talk about the

financial components before concluding, and so with that i would like to introduce mike martin from the office of workforce development >> thank you very much, phil. good afternoon, commissioners, mike martin i'm development project manager in the office of economic and workforce development. i wanted to take a few seconds at the beginning of our presentation today to give a little bit of the broader city-wide context of the project. basically for kind of linear story telling reasons we want to start with the broad picture and come to the specifics of the term sheet and a lot of the good thinking that has gone into the project itself and my role here is to be brief and also to talk about the partnership that is formed over the past several months that i have been involved and stretches back five plus years from today and obviously this is a great milestone. i think that the lead slide on our presentation shows a lot of how important this site is. it really, i think in a time

passed we called it a cross roads, i have been calling it a hindge between the south of market and downtown and the growing areas of south and mission day and shipyard candle stick and i think that you see this opportunity outlined in yellow and you start to visualize what a 24-hour vibrant residential and commercial neighborhood could do to really i think activate what is already a very exciting part of our city. and i think obviously, what we want this project to do is not only to do that but to do that in a way that enhances the opportunity that surrounds the site and also to address considerations on the local level and city wide level that really sort of conspire to create what we want san francisco to become and i think that the exciting part of the water front developments that we are seeing now, is it is really becomes a chance to learn from what we have done before and to do things better. i think that we saw today with the cruise ship terminal ribbon cutting was another step in

that same direction. a lot of policies effecting development have evolved and i think that we are seeing city wide initiatives, but not city wide but the initiatives like the planning process that helps us to visualize what san francisco was evolving to become, in terms of the mix of businesses and residents and amenities. i think that we have other policies that were being addressed through ballot members and workforce development provisions as well as affordable housing and for the people who live and work in the city. and in addition we had the evolving understanding of the new structure financing district, financing tool that really presents the opportunities but also challenges in that had had not been used in a way that i think was so directed towards development like this one and i think that a lot of thinking has gone on during that time

that has really improved the project as it has been brought before you today. with the continued build out of projects within this area of the water front, which includes obviously pier 70 and the proposal at pier 332, and the ongoing projects that we see out there, and for example, mission bay which is coming into focus which shipyard candle stick is doing the same and that i think there is a premium on having a coordinated approach. and i think what i have been very much enjoying is to see this partnership take root in the time that i have been involved with the project and it really has you know obviously three legs to the stood, i think that the port of san francisco is the steward of this opportunity and the port staff starting with i don't know than stern and phil williamson and brad benson have brought forward a fantastic proposal to this point and we also have 337 associates known

as the mission rock team and the subsidiary and the giants and i don't need to talk about how great they are aside from the success on the field i think that the things that they have been able to do in the neighborhood integrating with the city's fabric over the decades that they have been here will be an asset to any project especially to this one as it becomes a neighbor to the ballpark and then my office with the city, the office of economic and work fork department led by jennifer mats. what we are hoping to do is to assist in coordinating the city policy dialogue on the city wide policy issues and also to apply lessons learned on master planned developments like this one is slate to be and i have mentioned a few of them. shipyard candle stick and you have treasure island and each of those having a sort of kernel of learning to good use and create more value for the

project and city wide benefits. so, i think that there is a number of different sort of initiatives that sort of bear out what is in front of you in the term sheet and i am going to touch on a few of them really quickly, there say water front transportation assessment that i know that you have been briefed on, and i think that has been a critical dialogue that started around these water front projects as i mentioned before we are taking a look about the bill that is happening and proposed and looking at what is needed to make this part of the city function as the 21st century neighborhood. and looking at the modes of transportation is critical. and if not each project with a narrow focus, it is looking at the cumulative effects. how to make it work from the transit, automobile, pedestrians bikes, all of it what makes a city infrastructure work and that is a grailt boone and one that

will pursue over the next coming months. infrastructure financing and implementation of building out the infrastructure as you can see on the prior side, this was a currently a flat parking lot so we have to build the roads, utilities and we have to do the storm water and management and everything that is needed for a neighborhood and what we like to do is what we will talk about later is doing that in an efficient way and doing it in a way that is sort of well thought through with the city's capitol planning committee and how we build out the infrastructure in conjunction with the master planned development in a way that minimizing those costs so the land value comes to the ports and that is something that we are proud of in this term sheet and something that we would like to work with our team mates to really sort of actualize as a new way of doing things here in the city. i guess going back to the point that i made in terms of the environmental review and i worked on the america's cup review and the one thing that

we learned about was the value of getting out ahead of things like transportation and reaching out to stake holders and i think that the giants have done a great job in looking to address concerns in a way that we can start the process with answers, instead of using the process to say here is an impact and you got to find an answer and i think that is something that will stand this project and good stead going forward. lastly on the tip of a lot of tongues these day is sea level rise. and this is a great job of walking the walk that we need to see on the water front of a bay that is affected by the rising sea levels in terms of for the project itself, having a project plan that really addresses sea level rise and resil ans in the project site and we have been able to continue that beyond the project site and one of the things that i am excited about is during the infrastructure discussions and the policy that the port has drafted thinking about ways that implement our infrastructure and financing

dollars that come out of the district that are not needed for the project could be used to improve the city's sea wall, as we know, as the sea levels rise, we need to have a strategy to protect, obviously downtown and all along the water front in ways that are not necessarily going to be addressed by new projects of the sale of this one and that is something that i think that you sort of have a direct view but also a broader city wide benefit that we are excited to see. this partnership will continue through the term sheet approvals process that we are in now and hopefully through the entitlements and the dda and the build out. during that time, i think that the goal would be to reconcile the demands of this type of development but at the same time retaining the attributes of what they have brought forward, i mentioned that the other projects that they are excited now is this one is one more jewel in the crown and i am very excited and hand it off

to phil and doing the rest of the presentation, thanks very much. >> thank you, mike. >> commissioners? >> just jumping right into a project overview, much of this you have heard before i will go through it as quickly as possible. if you have questions, any time just let me know. project milestones in september of 2010, we entered into a exclusive negotiation with the giants and have been moving forward since then, and last march another milestone in the ena was the submital of the revised proposal and moving forward with that we bring you the term sheet with your review as an informational item and then we look forward to bringing that to you in a subsequent meeting for your consideration as an endorsement item. the project is a mixed use

project that includes 3.6 million square feet of built out space and that represents 11 development sites that could accommodate up to 1.7 million square feet of office space, brand new, up to 1500 new residential units over eight acres of parks and open space. new streets and new access to the water. several hundred thousand square feet of retail that will activate the site and be used by the people working there in the day and residents living there around the clock and by the neighborhood and region and visit ors to san francisco. the infrastructure for the sight is phased intended to be delivered and not too high of a cost but to be delivered to supply buildings in a timely fashion so that the infrastructure is used as soon as possible after it is

constructed. >> the infrastructure is funded privately by the developer and negotiating mechanisms to reimburse them for the cost that the infrastructure will be owned by the port in the city for the long term benefit of the port. again, as an overview, port revenues, the goal of this project and the goal of the negotiations has been to increase land value and to realize the value at this asset and this prime location, at this as mike mentioned as the hindge point to the working southern water front and our negotiations as you will hear later, we believe that we have accomplished that and we have more work to do through the dda and next in the transaction documents but we bring you today, i think a very well thought out term sheet that looks at risks and has answers for risks and provides a framework for moving this project. not only through the

entitlement process but also to construction, completing and generation of port revenues. of course, the whole time, going back many, many years we have a very healthy robust public out reach program that we have been following. these are some of the groups that we have met with not all of the groups but many of them including the maritime commerce of the port which was a refreshing discussion highlighting for us issues that we have already been tracking but it is always good to hear from the users of the port, their viewpoints about adjacent development especially the maritime users. and we see this as complimentary to the working water front and what is happening in pier 50 and south. and we are working with the marry time group and others to listen to concerns and shape the project accordingly going

forward. >> the land use summary shows that we have a plan to create a mixed use neighborhood that links mission bay to the city and to the working water front. changes for mission bay as we will get into it a little later, this site takes advantage of what we have learned from mission bay, which as many of you know it is consisted of fairly large blocks of commercial development for the most part that are very efficient but not necessarily extremely friendly to pedestrian and people trying to navigate through the site and especially through the water front and so this site learns from that and breaks the blocks, pretty much in half to create a smaller scale experience for the pedestrian and ways to see the water and ways to get to the water and we believe that also adds value to

the property. >> the land use plan employs flexible zoning and we will talk about that again in more detail shortly and that takes advantage of the market conditions to insure vital mix of use and users and the thinking here is to have some what of a flexible approach with maximums, and so we insure a mixture of uses and also to respond to the market with the appropriate supply of residential and commercial uses. >> it tells a good story, especially the upper bar, the top bar highlights today what we are contemplating. you will see, going back to 2007 on this slide, we really began the process to figure out how to use this site to generate the revenue and the port's public trust mission. and six years later, we came

before you with a term sheet for your review and it really marks, i think that the water in this project culminating the public meetings that i mentioned a few minutes ago, countless meetings with the team that that i described and countless meeting as well. but we believe that today we are at a juncture that really catapults the project into the entitlement process. and reading to the bottom part of the slide which outlines how the site could be built out with market projections of today's forecasters. starting in 2015, again, highlighting the just in time infrastructure approach, a building would be leased and a design would be drawn up and approved, and it will be constructed all of that happening before any infrastructure work is done so that when the building is complete, on a construction schedule that is typically two

years, the infrastructure is complete at the same time. and that repeats itself, for each phase through the project build out and approximately, 2021, 2022. >> the site is currently zoned a legacy zoning, if you will from an old mission bay plan, lot is zoned as open space and pier 48 is zoned m2, heavy industrial and going to ward and one of the tasks of the project is to rezone the site and through a special use district. and that has to occur after the environmental review, but that is the approach that we have outlined and chiefable way to accomplish the land use site. >> as far as project mapping, since the rfp of this project we have heard and we have

recognized that this site with this location, and its kind of proximity to mission bay has the opportunity to differentiate itself from mission bay and also compliment mission bay. and we think that doing that with the height on the site is a keyway to do that to not only differentiate but to add the densecy that makes the site vital and vibrant and our studies so far, are leaning towards up to 2 small, and too tall, signature residential powers. the height limits ranging from 90 feet at the low end to 380 feet at the high end. and the fud, would also require, amending the water front land ute plan and a feature of the projects along the water front that recognize the land use plan is a great tool. but its vision in 1997 needs to

be amended to reflect the reality of today's development market. >> this slide is interesting, in that it kind of shows you where the height on this site is contemplated. this is not exactly what we think will happen. it is an idea and it is a concept of what could happen on the site as far as where and the density and the mass of the project could end up. we are meeting with the community and the city regulators to figure out the best place for height and the most sensible heights to approach the neighborhood to again, ensure that the density that we desire for activation purposes is achieved and the blocks are numbered a through h. and the height right now in this proposal would be concentrated on block a, block f, and block c.

the height on the remaining parcels are very similar to what you see in mission bay with the maximum high of 160 feet. it will involve working with the regulatory partners among them the state lands and they are are others as well you are very well aware. but these are the two prime regulatory partners that we are with and have a healthy die long with and work to accomplish these tasks. as you saw in the first slide and as you know from experience, the lot is currently a surface parking lot that accommodates roughly 2,000 striped spaces. going forward. the project proposes a parking structure in the south west

corner of the project site we call that parcel d, the parking structure currently is being designed to accommodate approximately 2300 cars. there are additional parking spaces and other buildings on the site. and in the timing of the garage itself, is thought to occur early in the project as the parcels are taken down for development. surface parking goes away and so having a garage available to meet that demand will lessen the impacts on the neighborhood as fars the visitors that need to park for the ballpark and as the project is built out the users need the parking. getting the garage done early is seen as a key construction goal. >> the project team is working with mta. and they are interested and are looking at this garage as a project of their own to finance, and manage. we do not have a definitive

response or a definitive answer to that yet. but we are in the healthy dialogue. the demand is obviously there, we believe. to warrant investment. we look forward to updating you on that progress as we go forward. >> we also want to point out that the port does not expect to provide any public financing except cfd financing for the garage that is to be paid by special taxes on the parcels on the site. or taxable parcels off the site that benefit from the parking structure. >> the project, of course, will meet its affordable housing requirements and in the discussion and with the mayor's office of housing, to best meet the needs of the housing and mayor's office of housing. right now, as you k