Committee approves new Terminal 3 newsstand lease, budget analyst cites lower MAG than existing tenant

The Budget and Finance Committee recommended approval of a seven-year lease for a new newsstand in Terminal 3, after airport staff and the city budget analyst described a competitive RFP process and projected rent.

Kathy Weidner of San Francisco Airport said Paradis SFO LLC was selected as the highest-ranked responsive proposer for a roughly 1,062-square-foot retail space in Terminal 3 after seven firms responded to the RFP. The proposed lease uses the airport's standard concession structure (percentage rent with a minimum annual guarantee).

Weidner described the proposed minimum annual guarantee (MAG) at about $401,000, noting the airport now uses RFP scoring that balances MAG with other factors — including local participation — to broaden access for local Bay Area businesses. The Budget Analyst noted an existing similar newsstand in Terminal 3 carries a higher MAG (about $577,000) and estimated Paradis's minimum payments would total about $2.8 million over the seven-year term.

Supervisor John Avalos asked how many respondents are locally owned firms vs. national brands; Weidner said national brands often include a local subcontractor component and that the airport's RFP scoring emphasizes Bay Area ownership (the Terminal 2 sample showed roughly 70% local ownership by the airport's county-based definition). Weidner offered to provide further county-by-county breakout including San Francisco and San Mateo County specifically.

There was no public comment on the item and the committee moved the lease forward with a recommendation to the full Board.