SFPUC authorizes ordinance request for alternative contracting and ties surplus land sales to 525 Golden Gate plan

The San Francisco Public Utilities Commission on July 24 authorized the general manager to ask the Board of Supervisors to amend city rules so the SFPUC can select a construction manager/general contractor for the planned 525 Golden Gate administration building using qualifications-plus-cost criteria rather than a strict low‑bid process.

Commissioners and staff said the proposed procurement — an integrated project delivery model — would bring contractor expertise into design and allow value engineering and constructability reviews early in the process. Deputy staff told the commission four firms prequalified under the RFQ: Clark Construction, DPR Construction, Turner Construction and Webcor Builders; a fifth firm, Hunt, did not qualify because it lacked high‑rise experience.

The commission heard detailed funding and occupancy plans. Staff estimated roughly 800–1,300 occupants would eventually work in the new building and said avoided rent could support a par‑value bond estimated at about $130 million. To cover remaining costs, staff proposed using proceeds from surplus land sales; Item 12 on the agenda would place $21,060,000 from a South San Francisco sale toward the project. Staff said total surplus land sales targeted for the project could reach about $52 million but acknowledged specific properties for the remaining $30 million had not yet been identified.

Several commissioners raised safeguards to prevent proceeds from being absorbed into other city funds. Commissioner Normandy and others asked staff to trace prior surplus‑sale proceeds that had been expected to fund earlier building planning, and to return with stronger resolution language ensuring the money would be reserved and tracked for 525 Golden Gate. Staff agreed to provide a list of properties and an estimated allocation schedule; the commission removed a broad pre‑approval clause from the surplus sale resolution to preserve oversight.

Commissioners also discussed schedule risk: staff warned that a two‑week delay could jeopardize the project's timing because of the Board of Supervisors' recess and could cause months of slippage; several commissioners said they preferred to identify and confirm funding sources before committing to further design expenditures.

The commission voted to authorize staff to seek the Board ordinance and related contracting modifications and to proceed with the surplus land sale resolution as amended. The authorization will next go to the Board of Supervisors, which must act to amend the administrative code before the non‑standard contracting approach can be used.