Committee forwards Port ground lease consolidation with Aardvark Storage after holdover questions

The subcommittee considered a proposed Port commission ground lease consolidating three existing tenancies into a single ground lease with Aardvark Storage Unlimited (doing business as American Storage Unlimited) for roughly 274,163 square feet (6.2 acres) at 600 Amador Street (Seawall Lot 344).

Jerry Romani of the Port Real Estate Division described the tenant—s long-term relationship with the port and the proposed terms: initial monthly rent of about $58,945.04 (approximately $0.215 per square foot per month) with fixed annual increases between 2.33% and 4.5% and tenant responsibility for utilities and maintenance. Romani said the Port pursued direct negotiations because multiple potential uses (biodiesel, wastewater facilities, warehouse development) had been explored and found infeasible due to soil conditions, and there were not other prospective tenants seeking these large parcels.

Supervisors asked why the site had remained on month-to-month status since the early 2000s and whether the Port had considered a competitive bid. Port staff explained the holdover project and noted some tenants prefer month-to-month status; in cases where tenants declined multi-year terms, the Port retained them as month-to-month while raising rents to market. The budget analyst (Harvey Rose) advised that the proposed lease was awarded via direct negotiation and that section 2.6-1 of the San Francisco Administrative Code requires competitive bidding except where bidding is impractical; the analyst said the port provided reasonable rationale but considered approval a Board-level policy decision. The committee forwarded the lease to the full Board with recommendation.