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Board backs $10 million-a-year airport advertising deal after weeks of debate
Summary
The Board of Supervisors approved an eight-year advertising lease for San Francisco International Airport with a minimum annual guarantee of $10 million, after supervisors debated whether the City was leaving revenue on the table by not including a percentage-of-gross-revenue component.
The San Francisco Board of Supervisors voted on May 14 to approve an eight-year airport advertising lease that guarantees a minimum annual payment of $10 million to the city.
Why it mattered: The lease structure marks a departure from the airports traditional practice of combining a minimum annual guarantee (MAG) with a percentage-of-gross-revenue rent. Supporters said the high MAG locks in revenue at a time the airport may be at near-capacity; critics argued the city could forgo upside revenue if passenger growth exceeds projections.
What the Board decided The resolution approving the airport advertising lease passed on a roll call vote: 9 ayes, 2 noes. Supervisors John Avalos and David Campos voted no. The bid awarded to Clear Channel Outdoor, Inc. (doing business as Clear Channel Airports) will run for eight years with a minimum annual guarantee of $10 million. The…
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