>> good morning, everyone. this is monday, november 18, meeting of the budget and finance committee. i'm supervisor fewer. i am joined by supervisor mandelman, stefani, and peskin. i would like to thank sfgovtv for their assistance in broadcasting this meeting. >> clerk: please make sure to silence all cellphones. complete speaker cards and provide any documents to be included in the file.

>> thank you very much. madam clerk, can you call item 1. >> clerk: motion ordering submitted to the voters at an election to be held on march 3, 2020, an ordinance amending the business and tax regulations code and administrative code to impose an excise tax on persons keeping ground floor commercial space in certain neighborhood commercial districts and certain neighborhood commercial transit districts vacant, to fund assistance to small businesses; increasing the city's appropriations limit by the amount collected under the tax for four years from march 3, 2020. >> thank you very much. supervisor peskin. >> thank you, chair fewer, and members of the committee. i would like to thank you for convening two special budget and finance committees this week. of course we are getting used to the changed elections cycle. we normally have elections in june, but because of changes in

state law this will be the firm time we have an election at this time. i want to if you for your constructive suggestions at last week's meeting in regard to this tax. today i am proposing an amendment that i think addresses the concerns that supervisors fewer and stefani raised at last week's meeting, which is to address what happens when a small business goes out of business, but still has more time on their lease. while i think there's a fair argument to make that a lease in that scenario would become void or that the proprietor would be filing for bankruptcy or walking away from the lease, i fully agree that this tax should not be assessed against a lessee that goes out of business. an amendment i'm proposing is at 290 d lines 8 to 12 that says if

a business has been open for eight months, a legitimate lessee, and goes out of business with more time on their lease, they should not be liable for the tax on the remainder of the lease. i also want to thank ms ms. dikintreesee and the office for small business for the revised memorandum that they sent this morning that addresses the amendments that we made last week and contemplates this amendment as well. finally, i would like to apologize in advance for the fact that i will not be here on thursday, but thank you all for being willing to convene not only a special budget meeting, but a special board meeting in order to consider the possibility of putting this before the voters of san francisco in march of next year.

with that, i'm available to answer any questions. >> any questions or comments? seeing none, we'll open this up for public comment. you have two minutes. please come forward. >> my name is mark borsak. i'm a retail leasing broker and a real property attorney. i reside in supervisor stefani's district, and our property is on justin just across from the apple store. retail leasing is a troubled business. earlier this year our tenant filed for bankruptcy and vacated the premises. we have a highly experienced broker handling this space, and since april we received inquiries but only a few leasing

proposals. in sum, we're not even close to making a deal with a digital native food provider or traditional food provider after almost eight months. the internet's introduction sealed the fate for many retailers. in the late 1990s i predicted that the shift to online shopping would undermine location-based retailing. after the great recession, people increasingly shopped online shifting more sales from the store. dr. eagon's report notes a falling demand for physical space. particularly vulnerable are shopping street, merchants unable to offer customers convenience, goods, services or unique services. amazon's new next-day service offers yet another reason to avoid the store. in a recent study, i described the ongoing mayhem and its

ongoing impact on many retailers and property owners. in san francisco, store front vacancies result from formula -- impact. iatrogenesis describes the unforeseen harm caused by the dealer's practice. in this case, even more unstricted vacancies. in effect, the 2004 law are poisoning -- [ indiscernible ]. >> thank you very much, sir. your time is up. next speaker, please. >> good afternoon, supervisors. i am with the san francisco chamber of commerce. i spoke at the last hearing also, and i just want to say again we're really pleased that this legislation has been amended to try to ensure that

the reason behind this legislation, which is to capture and discourage the bad actors who are intentionally holding their properties off the market, that by doing that we're not inadvertently harming all of the good actors who are trying to fill their retail spaces as quickly as possible. i feel like the amendments are getting us there. this amendment is also very helpful. i still have some concerns that we are going to end up punishing people who are not able to fill their spaces due to no fault of their own, but i think that we're moving this in the right direction. i heard at the last hearing that the supervisor may be open to some trailing legislation, if should this pass we would be open to working with you on that. we do appreciate that this is moving in the right direction. thank you. >> good afternoon, supervisors -- morning, rather. cory smith on behalf of the san

francisco housing action coalition. some of our members are obviously trying to lease up ground floor space. in my conversations with them about this, one of the ideas they brought up was continuing to find ways to incentivize ground floor uses that we're all in support of and that we want to have. one of the ideas that had come up previously piece of legislation was to create ground floor child care units, where they would be able to live on the ground floor of a building and operate a child care facility out of there. we also are trying to get people into productive uses on a ground floor. if it's a piece of trailing legislation with be we want to do what we can to encourage some proactive amendments in order to try to get as many folks into those uses as possible. thank you. >> next speaker, please. >> i'm ron mcgel.

since 1938 our family has owned two buildings with ground floor retail businesses over 80 years. in spite of that, property owners and n.c.d.s were never notified of this legislation. we have been fortunate that neither of these spaces have ever been vacant. however, i've been obligated to drastically reduce the rent on one of them and defer any increase on the other, despite rising costs. we're only one of a multitude of small property owners that work with their tenants at a time when the entire retail business concept is drastically changing. you see it with major businesses in the union square area, as well as our n.c.d.s. our retail is undergoing far-reaching transformation. this legislation attempts to put a band-aid on a crisis and fails to acknowledge our current and particularly future retail

reality. the action is a slap in the face, a stick without a carrot. other approaches might be to allow small office space, incubation space, p.d.r., or others which are now prohibited by code in n.c.d.s. the problem of serving on the planning commission was the pages and pages of detail regarding n.c.d.s that vary greatly from one to the other. sometimes us in san francisco try to seek control over minu a minutia. please look to the future. don't attempt to duplicate the past. it's not going to happen. >> seeing no other speakers -- oh.

>> i used to engage in foundation research at the foundation center in the world affairs council building on behalf of the local non-profit. i would predict that the proposed ordinance amendment would have the effect of increasing the volume of small businesses along select commercial corridors filing for bankruptcy when they are defunct. i believe that it is reasonable to predict an upsurge in bankruptcy filings if the proposed ordinance amendment were to go into effect. also, it might concretize existing vacancies while imposing holding costs. so i hope that you are prepared to offer evidence to support the assertion that the imposition of an excise tax across a narrow band of the commercial segment will improve the opportunity as

well as the deposited outcome of restaurants, the food industry in general, or any other businesses. by evidence, i am referral to specifically but not exclusively, to a dataset of statistical evidence, a probability study, empirical analysis based -- basically anything of merit to ensure restaurateurs and commercial proprietors that the imposition of the proposed excise tax is not based solely on vague hypotheses, knee-jerk reaction, or an invalid sampling of those few select storefronts. yeah, i'll just stop this. >> thank you very much. any other public comment? seeing none, public comment is now closed. supervisor peskin, any comments at all? >> yeah, i would like to make a few comments. number one, we can and we actually are, as supervisors,

legislating carrots. whether it is the fee relief package that i spoke to last week at the board of supervisors in certain areas, changes to zoning. in north beach we extended the abandonment period. in other areas, people have embraced more flexible zoning, but only the voters can actually vote for the stick. as i said last week in committee, this is a tax that is absolutely avoidable and that we don't want to collect. it is an incentive for certain property owners who have not been the best actors to get it together. actually, what mr. mcgel said was really important, which is that he has managed, despite pressures from internet commerce to keep his n.c.d. ground floor commercial spaces occupied and admitted that is unfortunate but

other people need to learn, which is in some cases there is going to have to be a reduction in rent if you're going to fill those spaces. so that was actually -- i understand that while he might not like the proposal, is precisely what this legislation is aimed for other people who have not behaved as rationally and appropriately as the speaker to emulate. so i commend it to you and appreciate you holding not one but two special meetings to consider this legislation. i do finally in closing want to reiterate what ms. freed said from the treasurer's tax collector's office, which is should we put this on the ballot and should the voters approve it, it will not go into effect until january 2021 and the treasurer's office is committed

to doing a large outreach. this only applies to the spines of our most important commercial corridors, be it supervisor stefani's union and chestnut street corridors, my polk and columbus avenue corridors, clement street corridor, irving, terradale, some of the n.c.d.s in supervisor mandelman's corridor, but these only affect the vibrant or what should be vibrant commercial corridors in the city and county of san francisco. i commend the legislation to you, colleagues. >> thank you very much. any comments or questions from my colleagues? i also want to say that i think this amendment actually addresses the issues that supervisor stefani and i had last week in the questioning

about whether or not -- who would be liable in case a business goes under, is it the tenant who is -- whose business has failed or the land or property owner. i also want to say, yes, i would love to see those spaces being utilized for non-profits and child care, but they can't afford the $20,000 a month rent. it just is what it is. in my neighborhood, i have non-profits looking for space and dying for space, but at $20,000 a month, they just can't do it. i hope the legislation will bring the prices down and be an incentive for people to keep their tenants there that have been paying for 30 years. that they're not going to be slapped with a rent increase of four times the monthly rent so they can stay in the neighborhood and continue to be a business in our neighborhood for another 30 or 40 years. i am hoping that this is what

this will do. i want to echo what supervisor peskin said, people who have been paying attention know that we have actually legislated many carrots and sticks. i think the mayor is also offering one to help small businesses get into these storefronts too. today before us we have a simple amendment that i think we shall approve, and we will continue this until thursday. i make a motion to approve these amendments and to continue this item to the meeting on thursday, which is the 21st of november. can i take that without objection? thank you, colleagues. madam clerk, can you call item number 2. >> clerk: resolution authorizing the issuance and delivery of multifamily housing revenue bonds in an aggregate principal amount not to exceed $84,840,000, in one or more series or subseries, for the purpose of providing financing for the acquisition and rehabilitation of a 202-unit multifamily rental housing project known as

"eastern park apartments;" >> we have a little change in the presentation. in each hand from the mayor's office of housing and community development, item 2 before you is related to the city's proposed bond issuance for 711 eddie street. the proposed issuance is conduit financing. the project is existing 202-unit affordable housing that is sponsored by the northern california prebs tooern homes. the project would entail rehabilitation of the residential units, common space, and some of the building-wide systems. the project serves households

between up to 50 to 60% of the area median income. existing tenants will be temporary relocated and not replaced as a result of the rehab. in terms of the schedule, we will -- the project expects to be starting construction in early 2020. so we are asking the committee to recommend approval of the issuance. i'm available to answer any other questions. thank you. >> there is no b.l.a. report on this? seeing no public comments, this is closed. >> clerk: would you like to send this item for a report? >> yes, i think that's necessary. we can take that without objection. madam clerk, can you please read item number 3. >> clerk: resolution authorizing the issuance and delivery of multifamily housing revenue bonds in an aggregate principal amount

scbrooipt resolution; and related matters, as defined herein. resolution declaring the intent of the city and county of san francisco ("city") to reimburse certain expenditures from proceeds of future bonded indebtedness in an aggregate principal amount not to exceed $80,000,000; authorizing the director of the mayor's office of housing and community development ("director") to submit an application and related documents to the california debt limit allocation committee ("cdlac") to permit the issuance of residential mortgage revenue bonds in an aggregate principal amount not to exceed $80,000,000 for 2340 san jose avenue; >> this would secure an allocation of bonds as well to approve the d.d.a. status. we're requesting that this item be recommended as a committee report to go to the full board tomorrow to meet the deadline of december 11. not meeting this decline for this project would cost the city $11 in subsidy. the proposed bond issuance would

be financing and will not require the city to replenish its funds to retrieve the funds. this will be a housing development and will include commercial space and a community clinic. 72% of the units will be affordable to households earning no more than 62% of local median income. please note that this is the equivalent of 80% of tax credit a.m.i. no residents will be displaced because it's currently undeveloped. financing will close in 2020, with construction complete by august 2022. we will return to the board for the issuance approvals. i also have representatives from the project sponsor bridge housing to answer any questions. thank you for your support. >> there is no b.l.a. report on this.

let's open it up for public comment. i would like to move this to the full board. we take that without objection. thank you very much. madam clerk, can you please read item number 4. >> clerk: resolution declaring the intent of the city and county of san francisco ("city") to reimburse certain expenditures from proceeds of future bonded scbrooipt to exceed $80,000,000; authorizing the director of the mayor's office of housing and community development ("director") to submit an application and related documents to the california debt limit allocation committee >> we ask you to approval an allocation of bonds as well as to preserve the project's d.d.a.

status. we're requesting this item to be recommended for the full board tomorrow to meet the application deadline of december 11, which if we were to miss it would cost the city $10 million in subsidies. thank you for this. the proposed funds will be bo bonds. this will be a new affordable housing development located next to balboa park station. 67% of the units will be affordable for less than 50% of san francisco a.m.i. with a balance of the units affordable to less a.m.i. no residents will be displaced. it's currently a vacant lot. 39 units will be set aside for voluntary relocates. the project also includes an early childhood education center, ground floor retail, and a family wellness community resource center.

financing should close by december 2020, a construction complete by october 2020. again, we'll return to the board for the bond issuance approvals next year. i have representatives from the project sponsor here to answer any questions you may have. >> thank you very much. there is no b.l.a. report on this. any members of the public like to comment on item number 4? seeing none, public comment is closed.

>> clerk: subject to the terms of this resolution; and related matters, as defined herein. resolution declaring the intent of the city and county of san francisco ("city") to reimburse certain expenditures from proceeds of future bonded indebtedness in an aggregate principal amount not to exceed $80,000,000; authorizing the director of the mayor's office of housing and community development ("director") to submit an application and related documents to the california debt limit allocation committee ("cdlac") to permit the issuance of residential mortgage revenue bonds in an aggregate principal amount not to exceed $80,000,000 for 2340 san jose avenue; >> this would lose about the $10 million if it would not make it down the line in december. thank you to the committee for helping us expedite this as a committee report. the project is a new construction project of 130 units of affordable housing that is developed by the mission economic agency and the tenderloin development corporation. this has a large range of units

for families. they serve households from below to above the a.m.i. the financing is anticipated to close between june 2020 and july 2020, with construction starting within 180 days. the project sponsor is here. >> any members of the public like to comment on item 5. seeing none, it is closed. i would like to make a motion to move this to the full board.

>> clerk: resolution declaring the intent of the city and county of san francisco ("city") to reimburse certain expenditures from proceeds of future bonded indebtedness in an aggregate principal amount not to exceed $20,655,000; authorizing the director of the mayor's office of housing and community development ("director") to submit an application and related documents to the california debt limit allocation committee ("cdlac") to permit the issuance of residential mortgage revenue bonds in an aggregate principal amount not to exceed $20,655,000 for 190 coleridge street >> this would preserve the project's c.d.a. status and losing the d.d.a. status would cost the city $1 million. this proposed bond issuance is condo financing. it's an existing affordable housing property located in bernal heights, sponsored by the neighborhood center as well as bridge financing. the units will be reserved for households earning 60 to 80% a.m.i. there will be no displacement. residents can return after any

temporary relocation. the rehab scope includes significant work, including replacing windows and the roof, modernizing the elevator, water-proofing, significant exterior work. financing should close by november of 2020, and construction will be complete by 21. i have project sponsors here as well to answer any questions. >> thank you very much. there is no b.l.a. report on this. are any members of the public wanting to comment on item number 6? seeing none, public comment is closed. any comments or questions of my colleagues, seeing none, i would like to move this to the full board. we can take that without objection. madam clerk, do we have any other business for today? >> clerk: there is no business. >> we are adjourned. thank you. [♪]

>> two things have been brought to my attention, the cross-over on the bridge has been operating with a flashing red light instead of green, which is a passenger comfort issue and that ten-mile per hour speed limit signs have been added to the bus deck which is designed for buses operating at 20 miles per hour and that will be a limiting factor and also could be causing the bus fountains to behave anemically. after six months of operation, look into that. we want to make sure we don't do

temporary safety ideas that just get solidified and end up inhibiting our future capacity. >> ok, we'll follow up on that. >> call your next item, item 5, the exclusive director's report. >> good morning, directors. i'm pleased to provide you this morning with an update on ongoing operations at the transit center and our work to move forward. it's been a busy month of transit operations, events and activities, as well as efforts to onboard new tenants and retail spaces. first off, staff plan and responded to potential impact from the soma wildfires and outages from pg & e. we have redundant systems in place for power outages and while we were not impacted by the power outages we used this to review our systems and

protocol for power outages to ensure the least impact possible in the event we have one. as for bus plaza operations, we meet with the transit operators. and we are responding to a request for minor improvements and maintenance issues and moving forward with plans to waive findings signage in collaboration with atc and sfmta. as for the park, nice weather in september and october resulted in large grounds with exciting new events such as game meet-ups. these new events joined our regular complements joined by nearby families and seniors as well as fitness and wellness sponsored by fitness sf. as of november, we have adjusting programming for the fall and winter months adding a

movie night. the park hours are now 8:00 p.m. for the fall and winter months. and on the retail front, i'm happy to report that we are bringing three additional leases for you today. we are finalizing a fourth lease under my approval authority. if all four leases are approved and executed, this will result in 75% of the transit center p being fully leased. this is an exciting time as we will see large numbers of the public visiting with the first of the tenants opening durings to thdoors tothe public. on-site dental is opening and fitness assess has started selling memberships on site and getting ready for the grand opening on december 27th. phil's coffee is communitied too have two locations open in january. with all of these openings, we will have 45% of the transit open for service, basically.

and with these businesses open, we will have much more traffic than we have today. as a point of reference, fitness sf alone is expected to have 3,000 visitors a day under normal operations. our security and operation's teams are busy on-boarding new tenants and they are plan for the increased foot traffic throughout the transit center. and we are now focusing on helping the remainder of the tenants and working on the permit processing, making sure they respond to dbi comments as soon as possible and with their procurement process of the contractors. our facility manager with provide you with more updates on that later this morning. on to phase two in the downtown extension, we were happy to cohost a tour with mtc for

congressman rodney davis of illinois. congressman davis is a member of the house, transportation and infrastructure committee and he was in california to enlarge infrastructure projects and very impressed with the transit center and with our effort for planning ahead for the future by building the lower concourse and train levels as part of phase one in preparation for phase two and the trains. phase two peer review is now complete. we work with our partners to implement the recommendations that was done earlier this year by the tgpa, as well as results of the peer review. our hope is that these peer reviews will strengthen the project and get it delivered on time. at this time, i would like to invite dennis pearson for the update agreements. >> good morning. i'll provide you a brief report

of the project labor agreement quarterly for q3 and go through the administration and labor statistics as previous reports. so we held our 30th meeting of september 19th with the joint administrative committee where we went through a construction close-out you'll hear today from ron alamada and an improvement update you'll hear from martha valez and we discuss union updates and apprenticeships, as well, as our standing operations, with the veterans and apprentices and all of the unions at this point. regarding the labor update, we did not have any work stoppages and that affected no labor instances at all during our punch list items and zero recordables in the third quarter which keeps our street going quite awhile now. and then lastly, statistics on

how many hours we've had as of th.as of september 30, we had 5.7 million and skeletal clue cleaning up that ron will refer to, i'm sure we surpassed 5.7 mill at this point. so with that, that concludes my brief project labor agreement update. >> this concludes my report, as well. >> any questions? >> in talking about signage, somebody mentioned that the signage from the transbay terminal to bart is not clear. they weren't aware they could see it and i know i've seen in other cities where there's signage along the floor and i know we have that outside of the terminal, getting people to the bus deck but i wonder if it's directing people to the two bart stations.

maybe that's something we can work on. >> to get a consultant on board for an overreview of the signage and do some outreach to the passengers and let us know what other signage needs to be done. >> i think a lot of us use it, we know where the bart stations are. >> we'll include that. >> good morning. i'm jim patrick from patrick and company and i would like to talk about this joint labor agreement and i argued at the same podium maybe four or five years ago, i've forgotten, that this was a mistake and we shouldn't adopt

this agreement. and they stayed thank you, mr. patrick, all in favour say aye and it was passed unanimously. now we're five years down the line and how did we do? well, let's see, we didn't have a strike and that was good. did we deliver the project on time? no. this sort of assumes we agreed to pay the highest price for labor and that's in the contract. now let's see, that implies the highest quality and i'm trying to think. i remember a big hole in a beam and it caused 11, 12-month delay. we brought on this contractor, fisk, and they were a disaster. oh, we knew what our costs were. they would be easy. we went overbudget. we didn't know what our costs were. i think by not doing this, we could have saved $300 million, could have saved the the city of

san francisco and brought in ins in on time. we pride ourselves $3 million on 50 states. why aren't we spending in the san francisco bay area? doesn't that make more sense? what's wrong with us? it's a politically correct decision but your job is to manage a business. you agreed to pay 5.7 million craft hours, you just reported and you agreed to pay the highest price. for sure, we're going to have the highest budget. for sure, we're probably going to have cost overruns and it won't work very well. since this is a done deal, i would like to reference to the memorandum, which is part of what he was talking about and in the third line it says, this agreement provided -- i'm talking about the jpl or whatever it's called -- provided

standardized working conditions and wages. i suggest we need to add the word highest as an adjective to the wages because we also agreed to pay the highest wages and we're sweeping that problem under the table and i don't think that's right. thank you. item six is the construction close-out dates. >> good morning, directors, ron alameda, director of design and construction for the tgpa and i'm pleased to report that we're advancing through the close-out. now that we're open and the physical aspects of the beam are behind us, we were able to refocus everybody on to the close-out effort.

as we stand now, as you see in the pie graph, we have 14 trade groups that are in active close-out with the contractor and 13 out of 49 are goin advang to a dispute resolution meeting to help resolve those issues. we have 22 closed out and related that in terms of close-out, we're down to 26 punch list items. so that effort, the physical effort out on the site is winding down. and we expect to, in terms of timesline, trajectory, we're striving to close out the straightforward contractors with the web core by the end of the year and we're striving to wrap

up the dispute resolution activity early next year, january, february, and then we'll see the remainders, if any, that will continue on to litigation. and we'll get to that a little bit more next month when we have a briefing in closed session regarding legal matters. contingency costs in the last couple of months, it's been $400,000 worth of contingency draw-down, three of which were from the cmgc contingency and finalizing old issues going back and forth. in terms of new stuff, the construction contingency of 100,000 was generally netting out due to modifications because of ti and the mechanical work and what have you.

so small and winding down usage of the contingency as we wrap up the physical work up there. with respect to budget, construction budget, we have an uptick of 19.1 million and that's drawn from both contingency and program reserve and i think the drivers were discussed in earlier meetings and this is just a reflection of dealing with a bit of the legal matters, as well as some of the additional costs with the ti work. and the e estimated at completin was 2 million in legal that moved that needle and towards the completion, where our program reserve was reduced by

10.5 million. again, to reflect the movement towards construction. that's about it. pretty short and street and we're in the final strokes of closing this thing out? thank you very much. >> move on to your next item. item 7 is the facility operation's update. >> good morning, directors, martha valez, the facility manager. i will provide a general facility's update. sidney will give a security overvieoverview and i will discs leasing and tenant improvements. when we last met discussions with regard to amtrak had not been finalized.

since that time, amtrak decided to relocate to the street-level island at mission and fremont and it is the same island that sam-trans uses. this was effective on october 28th and they are currently vacating the temporary terminal this month. other transit activity as of note -- transit center activity as of note is the executive director mentioning on-site dental will be ready to open on monday, november 18th. the top picture is a completed exam room and it is washed in blue light because they have a lighting system that can individually adjust to each exam room according to patient's needs and fitness assess is moving full steam ahead to open on december 27th. they are currently conducting on-site membership drive. lastly, phil's is targeting the end of january, so at that point, almost half the center

will be open for business. this slide is to provide you a visual of the activities of the three tenants starting at the top left moving clock-wise. the first two pictures are fitness assess setting up an exercise area. the next two are phil's with a picture of how they wrapped the storefront at mena and front street. the picture of the inside of that same space under construction, you can see the framing is nearly finished. the last two are on-site dental and a picture of the completed interior hallways with exam rooms on each side and a picture of one of the exam rooms. when i took they picture, they were still setting up. generally, other activities of note, lincoln is working with a vendor on the european style market for the gran hall and i'll provide a few more details on this next slide and brv has

moved into the winter programming. the park is now closing an hour earlier at 8:00 p.m. and each friday in november is movie night and mostly geared towards children and in december, a half week before the holidays, a low-key winter fest is planned with activities also geared towards children, for example, time with santa and face painting and planned is silent disco and music. popular activities, such as toddler tuesdays remain. the daily calendar can be found on the salesforcetransitcenter.com. pearl work is ongoing. this slide notes the advertisers to date and the expected revenue of about 652,000. the top picture is to highlight that food trucks remain a daily routine and going up to the park. and the bottom picture is a representation of the european

holiday style market and the european market is planned for the grand hall and the outside area between the grand hall and sales force tower and boston properties is working with the same vendor to extend the market on to sales force plaza. the bottom right is how the vendors would be arranged and run through the month of december from 11:00 a.m. to 7:0s pending ironing out details with the vendor. the overall objective is to build events with annual center tradition creating excitement, foot traffic, support the businesses and by extension supports the transit operators and the general public. >> an update on security, supporting brb's new winter hours and the reduced winter park hours and coordinating with transit operators to make incremental security

improvements to the bus ramp to include additional signage and improve messaging. securities coordinating with the tenants as a part of the pa strategy to prepare for the retail transit center. >> thank you. >> the following is an up on the retail leasing. today four leases will be presented, three of which are on the content calendar and the three on the consent calendar are spring fertility, poke house, gte or mobile verizon and with the director signing authority. as a reminder, the director signing authority is leasing that are ten years or less and 1.$8 million in aggregate rent or less. and this table is a summary of the status of the center when the four leases are completed. and as you can see, the center will be 75% leased with the average annual rent at 98% of

proforma. when fully leased it would exceed proforma. this spring lease is spring fertility, on the second floor on the but florid plaza adjaceno on-site dental. the nature of the business is as it is named. a consultation office with no procedures performed other than blood draws. rent of 3.3 million over 15 years and a base-building estimate less than proforma for net proceeds the life of the lease at 2.7 million. this next least is poke house and they feature hawaiian style

poke. that's a slice raw fish served over rice and fresh vegetables with sauces. this the first san francisco location with five other locations in the bay area. to recap the deal above proforma, ten years, three months, rent of 1.13 million over ten years and three months. tenant improvement that is less than proforma for net proceeds over the life of the lease of 770,000. this next one is an outlet and to recap, in general above proforma, rent of 2.5 million, a tenant improvement in base building estimate less than proforma with the tenant improvement at zero and offsets

the rent and the lease is $1.84 million. this is the last lease, happy lemon. this will feature teas and juices and this is the first location of san francisco and others throughout the bay area. to recap the deal, above pro for proforma, a base building estimate sightly above and offset by the proforma rent and net proceeds over the life are $600,000. we're working clock-wise and we have phil's coffee, happy lemon, suite 17 and 18 were working for

initial services, hopefully a bank, tycoon kitchen, venga and pernadas and suite 135, it's a mexican restaurant, charlies, a foundation cafe, phil's coffee and verizon and suite 137 is a health food operator and sweet 133 is a space without specific interest. we have interest from two operators. and this is the second floor, as you know, above the -- below the bus, sf kaiser and on-site dental and spring fertility so the entire second floor has nicely filled in with health-related services. and lastly, the park level, the restaurant and cafe pad.

in discussing the tenant improvements, this is to provide an overview of what was originally envisioned for the program in 2010 as compared to today. and this is what the market demanded. this puts into context the work needed to reconcile the built systems to what is needed to invest in the kitchen exhaust and utility tenant improvements. on the ground level, 14 spaces in 2010 as compared to 23 spaces today and what this means to the infrastructure is capacity and scrubber and for all spaces redistribution for water, gas and sewer. on the second level below the bus deck, a food court in 2010,

fitness sf today. so this mainly means redistribution of gas lines and how configured at the source in the meter room. at the second level, adding services meant adding lines for water sewer and a redistribution for the electrical. this work has actually already been done because of needing to complete it before the ocs lines were electrified. and also note the original plan was for non-revenue generating space on the space above the bus plaza and in general smaller spaces demand higher per-foot than lower spaces. and so as impacts to overall schedules are understood with regard to the kitchen exhaust and utility work, also to be reconciled are the tenant's own schedules. on the left side of the table are the various challenges to the schedule and on the right side are actions and/or

mitigations related to the noted challenges. the top section labeled physical, i'm going to discuss that in a later slide. the bottom section lists the various areas that impact the tenant's own schedules and how addressed. and with permitting, lincoln has hired an expedited in supporting the tenants as they move through the process and a primary benefit is making sure that the tenant is responding to dbi's comments so as to not slow the process. the expediter produces weekly notes for each tenant on a weekly basis. a tight labor market in some instances has delayed the tenant in getting competitive quotes. they are working as was done with fitness sf and on-site

dental but not every tenant wants to do that. with the construction timeline, in general, lincoln is endeavoring to compress the timeline, again, to work with the landlord concurrently as just described. tenants are also experiencing sticker shock. this is also a factor in that even with competitive bids, costs are high and as noted in recent chronicle in october and this means the tenant will have to rethink what was originally envisioned in the space. lastly, many of the tenants have expressed needing to open at the same time as neighbors because of synergy needed for foot traffic generation. this is also a schedule impact in working with them to support them in their success. so taking the previous factors into consideration, this slide is what the start of revenue may

look like with the solid bar depicting the fiscal year '19-'20 and the cross-hatch indicating a projected start. even so, keep in mind revenue will be generated on 45% of the leasable space by the end of january. on-site dental, fitness sf and fills and the rest will follow in clusters. also, not every ground-floortinnant may befloore impacted. seven are leased by tenants that are type one and type one is smoke and grease and of the seven, four are currently impacted because they are at a point in their design work where specific information is needed to move forward. the rest are not as far along, so impacts to the schedule will be assessed when a decision is made as to the exhaust system type with the ultimate goal of opening as