Committee amends and forwards interim Old Mint lease with NPU Inc.; tenant to perform improvements and pay percentage rent

The Budget and Finance Committee on Sept. 3 voted to amend and forward to the full Board of Supervisors a resolution authorizing the Director of Property to enter into an interim lease with NPU Inc. (Non Plus Ultra) for the Old San Francisco Mint at 88 Fifth Street. The amended lease term is four years with three five-year options to extend; the city inserted a termination clause allowing the city to end the interim lease should the larger capital project proceed.

Under the amended terms read into the record, the city would forgive $163,000 in past-due rent in exchange for tenant-funded capital improvements valued at $477,000. The tenant will pay a participation rent equal to 10% of gross monthly revenue, and will assume responsibility for utilities, taxes, maintenance and security. The Real Estate Division said it did not competitively reprocure the interim use because of the tenant’s history with the site and the earlier RFP produced only one respondent; the Budget and Legislative Analyst recommended establishing an internal policy to operationalize the administrative code requirement that leases be competitively awarded.

John Lau of the Office of Economic and Workforce Development said the interim lease is an important ‘‘puzzle piece’’ while the city continues due diligence and planning for a larger restoration and capital project for the Mint that could cost on the order of $300 million. Jordan Langer, president and CEO of NPU, addressed committee questions about a prior personnel-related legal claim and said the claim was dismissed and that NPU had kept staff on during the pandemic. The committee approved the amended resolution and forwarded the item to the full board with a positive recommendation (3-0). The committee asked the Real Estate Division to provide an affidavit from the tenant documenting dismissal of the claim prior to the full-board hearing.