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Commission approves new commercial and industrial lease rate ranges for Santa Barbara Airport properties
Summary
The Airport Commission unanimously approved updated lease rate ranges for airport commercial and industrial properties effective July 1; staff said proposed ranges aim to remain below market for lower‑quality buildings while allowing higher rates for Class A/B spaces and preserve flexibility for lease terms and CAM/escallators.
The Santa Barbara Airport Commission on Tuesday unanimously approved updated rate ranges for commercial and industrial lease space managed by the airport; the new ranges take effect July 1 for new leases and apply at renewal.
John Feldhans, the airport properties manager, told the commission the properties division manages about 173,000 square feet of office, retail, storage and light industrial space outside the air operations area and approximately 337,000 square feet of aeronautical space. He presented market benchmarking that showed local quarter‑to‑quarter declines in average rents (office down about 3%, retail down about 5%, industrial down about 14% in the most recent comparison) and described a proposed adjustment that narrows the gap with Goleta market averages while preserving a discount for lower‑quality buildings.
Feldhans said proposed changes give the properties division flexibility to price higher‑quality (Class A/B) buildings closer to market while keeping older Class C buildings accessible to budget‑conscious tenants. He noted some buildings are undergoing mold mitigation and that vacancy for rentable buildings is currently low. The division is also moving toward including common area maintenance (CAM) charges in new leases where appropriate.
Commissioners asked about vacancy, triple‑net status and zoning restrictions. Feldhans said lease types vary depending on when each lease was negotiated; many leases include CPI escalators or other escalators. Commissioners noted airport proximity and flight‑path constraints, height limits and specific‑plan zoning factors that restrict some uses and affect marketability.
Commissioner remarks emphasized the airport’s potential role in regional economic development and the need for a master plan to improve older buildings on the north side of Hollister Avenue so university spinouts and small companies have local space to grow. Feldhans said future capital development would likely rely on public‑private partnerships and ground leases rather than full airport funding.
The commission moved to approve the proposed ranges and passed the motion unanimously.
Votes at a glance
- Consent calendar (routine leases): motion to approve consent calendar passed unanimously (7–0). - Approval of new commercial/industrial lease rate ranges: motion passed unanimously (7–0); new ranges effective July 1 for new leases and applied at renewal.
Commissioners asked staff to continue working on a strategic plan for property redevelopment and to return with additional details on vacancy calculations, lease types, and potential master‑planning steps.
