Title
Final Passage of Ordinance Approving a Lease and Authorizing the Acting City Manager to Execute Documents Necessary to Implement the Terms of a Forty-Eight Month Lease for 44,000 Square Feet with Shimmick/CEC Joint Venture, for a Portion of Building 170, Located at 1770 Viking Street at Alameda Point. [In accordance with the California Environmental Quality Act (CEQA), this project is Categorically Exempt under the CEQA Guidelines Section 15301(c) - Existing Facilities.] [Requires Four Affirmative Votes] (Base Reuse 819099) (Revised to Include Conditions and Information from First Reading)
Body
To: Honorable Mayor and Members of the City Council
From: Elizabeth D. Warmerdam, Acting City Manager
Re: Final Passage of Ordinance Approving a Lease and Authorizing the Acting City Manager to Execute Documents Necessary to Implement the Terms of a Forty Eight Month Lease for 44,000 Square Feet with Shimmick/CEC Joint Venture, for a Portion of Building 170, Located at 1770 Viking Street at Alameda Point (Revised to Include Conditions and Information from First Reading)
BACKGROUND
Shimmick/CEC Joint Venture is the contractor working on the seismic retrofit of the Transbay Tunnel for Bay Area Rapid Transit (BART). The premises will be used for storage of non-hazardous construction material associated with the retrofit project. The premises include both building and yard space. The tenant has committed to limiting truck traffic to 20 trips per day and further limiting the trips by restricting all outbound trips between the peak hours of 7 a.m. and 9 a.m. (except in emergency situation). At the first reading for the lease approval, April 17, 2018, the City Council requested additional information on the trucks used by Shimmick and their truck route options (Exhibit 4). Their primary truck route will be Ralph Appezzato Mermorial Parkway to Webster Street and then the Tubes. City staff will conduct quarterly review of truck logs and will report truck data back to the City Council within 9 months.
DISCUSSION
Building 170 is located in the Enterprise District of Site B, development is not expected to occur on the premises until the infrastructure associated with Site A is installed. A portion of this building is in the Lease In Furtherance of Conveyance, and therefore owned by the Navy. The City is unable to develop this site until the property transfers to City ownership. However, if the City receives serious offers for development in this area, and the Navy-owned portion could be addressed, the proposed lease includes a very favorable termination provision for the City. The City, at any time after the expiration of the eighteenth month of the term can deliver a written notice of termination. The tenant will have no less than 6 months to vacate after delivery of the termination notice. The City could offer more advanced notice of termination, but not less than six months. The tenant can agree to less if they are able to move more quickly and are interested in reducing their rent obligation.
This lease is entirely considered an interim use for the area, as the Enterprise area is planned as the job and/or sales tax generating hub of Alameda Point. The area is designated for much more intensive uses than material storage. Staff viewed this lease as a revenue generating opportunity. The tenant who previously occupied this same space paid a monthly rent of $7,200. Shimmick will pay the City $24,200 with annual 3% increases.
FINANCIAL IMPACT
The monies from the leases will be deposited into the Base Reuse Lease Revenue Fund (Fund 858) and are limited to uses permitted under the Economic Development Conveyance Memorandum of Agreement with the United States Navy (Navy).
MUNICIPAL CODE/POLICY DOCUMENT CROSS REFERENCE
This action does not affect the Alameda Municipal Code.
ENVIRONMENTAL REVIEW
In accordance with the California Environmental Quality Act (CEQA), this project is Categorically Exempt under the CEQA Guidelines Section 15301(c) - Existing Facilities.
RECOMMENDATION
Final Passage of an Ordinance approving a lease with Shimmick/CEC Joint Venture, for forty eight months, for a portion of building 170 located at 1770 Viking Street at Alameda Point and authorizing the Acting City Manager to execute documents necessary to implement the terms of a lease.
Respectfully submitted,
Jennifer Ott, Base Reuse and Transportation Planning Director
By,
Nanette Mocanu, Assistant Community Development Director
Financial Impact section reviewed,
Elena Adair, Finance Director
Exhibits:
1. Aerial Map
2. Premises
3. Lease
4. Shimmick Truck Photos/Truck Route