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Port approves 15-year lease for new restaurant at 295 Terry Francois Boulevard
Summary
The Port Commission approved sending a 15-year retail lease with a 15-year option to the Board of Supervisors for a restaurant at 295 Terry Francois Boulevard; the lease requires $2 million in tenant improvements, nine months of rent abatement for construction and a $380,000 one-time rent credit.
The commission approved a resolution to authorize negotiation and submittal to the Board of Supervisors of a 15-year lease with a 15-year option between the Port and E Street San Francisco LLC for a restaurant location at 295 Terry Francois Boulevard.
Key terms: Port real-estate staff said the lease requires a tenant investment of $2,000,000 for core shell and tenant improvements, a nine-month rent-abatement period during construction, and a one-time $380,000 rent credit to be applied to core-and-shell improvements. The base rent structure was described as "$10,000 a month or 7% of gross sales, whichever is greater," with annual increases of 3% and market-rate adjustments if the option is exercised.
Financial and development expectations: Staff projected first-year sales roughly in the $2.3'$2.4 million range, translating to approximately $14,000'$15,000 per month to the Port in rent in year one under their projections. Tenant principals and development partners were in attendance and the Port said the lease is subject to Board of Supervisors approval.
Vote: Commissioners moved, seconded and adopted the resolution, which the clerk recorded as "Aye." The vote authorized staff to forward the lease to the Board of Supervisors for final approval.
There were no substantive amendments recorded in the meeting; commissioners praised the project's sustainability features and wished the tenants success.
