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Committee sends airport lease amendments tied to Alaska‑Virgin merger to Board
Summary
The committee recommended approval of two airport lease modifications: incorporation of former Virgin America terminal space into Alaska Airlines’ Terminal 2 lease and early termination of the Virgin America lease. Airport staff said Alaska will occupy additional exclusive and joint use space and estimated rent income of about $20.8 million through June 2021.
The Budget & Finance Committee advanced two related resolutions affecting terminal space at San Francisco International Airport following the Alaska Air–Virgin America merger.
Airport staff explained modification #1 to the 2011 lease with Alaska Airlines would add approximately 12,600 square feet of exclusive space in Terminal 2 (and more joint‑use space), and the modification to the Virgin America lease would authorize early termination to formalize Alaska’s occupancy. Staff said Alaska will occupy roughly 19,300 square feet of exclusive use and 91,900 square feet of joint use space in Terminal 2 in addition to its existing International Terminal footprint. Estimated rent attributable to the changes for December 2019–June 2021 was presented at about $20.8 million.
BLA reviewed the occupancy changes and revenue tables in its report, noting the lease will need renegotiation in 2021 when the 2011 term expires, and recommended approval. The committee moved both lease actions to the Board with a positive recommendation.
