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Land Use Committee backs Port term sheet to bring Teatro Zinzani back to Seawall lots
Summary
The committee gave a positive recommendation to the full Board for a Port term sheet that would site a Teatro Zinzani dinner theater, a boutique hotel and privately funded public space on Seawall Lots 323–324. Staff cited a roughly $124 million project cost, no Port capital funding, and job and revenue estimates.
The San Francisco Board of Supervisors Land Use and Transportation Committee on Wednesday recommended that the full Board endorse a Port of San Francisco term sheet with developer Teatro Zinzani to lease and develop Seawall Lots 323 and 324 for a boutique hotel, dinner theater and public open space.
Ricky Tidani, development project manager for the Port, told the committee the total development cost is currently estimated at about $124,000,000, with roughly $64,000,000 in equity and no Port funding. The term sheet proposes an initial 50-year lease with an option for an additional 16 years, a lease development and disposition agreement (LDDA) covering construction, and performance milestones during an entitlement and construction period.
"There is gonna be an LDDA… they will have 36 months to complete all the requirements under the LDDA," Tidani said, summarizing key construction and performance deadlines. He described the rent structure as a minimum base rent, percentage rent tied to performance and a participation rent on refinance or sale so the Port can share upside.
Port staff estimated construction‑period payments to the Port of about $890,000 and a first‑year minimum base rent of about $915,000, plus a projected one‑time city impact fee of roughly $7.8 million and an average annual net port revenue floor of approximately $5,000,000. The term sheet also requires the developer to pay transaction costs during entitlement and contains liquidated‑damages provisions if construction milestones are missed.
Supporters who spoke during public comment included labor, neighborhood and arts representatives. Mike Theriault of the San Francisco Building and Construction Trades Council said the trades had been involved in outreach and supported the project. Cynthia Gomez of Unite Here Local 2 said the developer had signed agreements to ensure good wages and neutrality on union organizing.
"They're setting an example for the developers of future hotels in the city," Gomez said.
Supervisor Aaron Peskin moved that the committee give the item a positive recommendation to the full Board; the motion passed without objection.
The committee's action was a recommendation only; the Port commission and the full Board of Supervisors will have subsequent approvals. The term sheet calls for the Port to obtain an appraisal and real‑estate consultant to confirm fair market value before a lease would be executed.
