Benefit from living and working on their traditional homeland. We wish to pay our respects by acknowledging the relatives and ancestors of the ramaytush o lone. I move. Second. We have a motion and a second. All in favor. Aye. The minutes have been approved. Item number 3 is Public Comment on executive session. Thank you. Is there any Public Comment in the room . Seeing none, corey, is there anyone on the line . For callers on the line, please press star3 if you wish to make Public Comment. The system will let you know when its open. Comments will be limited to 3 minutes per person. Please press star3 if you wish to make Public Comment. At this time, there is nobody on the line wishing to make Public Comment. Thank you, Public Comment is closed. Item 4, two executive session items, one employee and two counsel on matter. I move that we enter into closed session. Second. We have a motion and a second. All in favor. Aye. Aye. We are now in closed session. [applause] i move disclose no other information from closed session. We have a motion and a seconded. All in favor . Aye opposed . Public comment. Next item 6 is the pledge. [pledge of allegiance] item 7 announcements. Be advised ringing and use of cell phones and sound prugs electronics are prohibited at this meeting. A member of the public has 3 minutes to make comment on each item. Unless the Port Commission adopts a shorter period. Public comment in respect to the current agenda item the commission will take in person and remote comment beginning with in person. Remote comment dial 4155540001 and enter access code 2664 310 3650. Then star 3 to raise your hand to comment. If you are watching on sfgovtv there is a broadcast to not miss your chance to comment dial when the item you want to comment on is announced. Use your device and listen from your phone which has no delay. Item 8 is Public Comment on items not on the agenda. Thank you. Do we have Public Comment on items not on the agenda . Core, do we have anyone on the phone . At this time, there is no one on the phone wishing to comment. Thank you. Public comment is closed. Next item, 9a the executive directors report and callers who wish to comment dial star 3 to raise your hand. Good afternoon members of the commission and the public and port staff im the executive director of the port. First i want to acknowledge a historic anniversary on thursday. The ferry blgsd turning 125 years old. There will be a celebration for the public this opens at upon 11 a. M. And the first 5 huh in line get free ice cream. The band will perform on the back mraz and under 17 you can ride the ferries all day for free. 12 30 the mayor will peek and produce a time capsule of important items that will be stored in the clock tower until 2038. When the building will be 150 and this time capsule will be opened. Later in the afternoon from 46 a happy hour in the beer garden with 5 pints not available to the free 17 and under ferry riders but fun for all. Come if you are able to join. Im excited start with good news on key 3 strategy areas of economic recovery, growth and equity competence resilience. Last thursday California State Transportation Agency awarded us 21 Million Dollars to modernize the merry time terminals in the southern waterfront at pier 80. 1. 2 billion dollars for the supply chain a Huge Investment in the ports this award will advance 3 projects accommodate larger ocean going vessels with higher cargo volume. Support amdover street and the major vehicle art row tot port merry time industrial and study the development of 100 vehicle electric truck float at pier 96. We hope the goal is to have build a battery or Hydrogen Fuelling station that will move us closer to the city wherevero e mission goals. I am very pleased we believe our efforts put us as in the game and recognized as part of the supply chain in that ecosystem of the supply chain. I want to thank our commissioners and the work of the California Association of Port Authority who have seen our value and our delegation at the state that has made this happen with the thanks to member phil tang on that committee. Because of these funds we have now an ability to put ourselves in a stronger position for off shore wind operations including fabrication opportunity. This provides a road map for us to build a green and clean are southern water front of our future good jobs and resource. We are very grateful. Senator is the leader and they are presenting a value based criteria to do award, safety, climb action and economic prosperity. Words are different we see how the states desire to cal staalign with our goals economic recovery, growth and resilience. Congratulations. We are look forward to see the ribbon cutting. More on economic recovery and growth. Despite last weekee ruby princess stay in San Francisco, and her happy return on seas on sunday, im happy to report that for this visit year we had the highest ever cruise calls in passengers and passenger numbers for cruise calls at 110 calls with 390, 967 passengers visiting San Francisco this. Is 100,000 passengers more than our previous record. I like to thank our cruise partners at carnival, princess. Metro the port staff and merry Time Division and others that made this happen it is a record breaking year. The wharf activation the party at the wharf out door summer Concert Series that starts this friday july 14th with the cbd the Wharf Community Benefit District and calls on the award this commission authorized 2 Million Dollars investment. This series will bring artists to perform live at the wharf at the crab wheel every weekend to beautify the space. You will all receive invitations to the concert local artists sam johnson play at the first performance so we hope to see everyone there supporting the activation of our wharf. Now id like to speak about our Credit Rating and our budget. More positive news all 3 bond rating agencies affirmed the rating and 2 improved us from a stable outlook from negative to a stable outlook. Where, a, a, and aa3. And im thankful to the finance team and all the work we have done with capitol budget to show we have a plan for our official future and on good footing this improvement based on our Strong Revenue recovery as well and healthy reserve levels. After that pandemic we spent down our savings im relieved we received the arpa funding and get ourselves back in shape and the Credit Rating agencies are seeing that. Last week at your board of supervisors approved our supplemental appropriation. 1 Million Dollars. This includes resources for the Mission Bay Parks we are taking on. Which will be transferred from the redevelopment agency. Critically the costs are reimbursed throughout taxes that are set up. Also, mayor breed is going to join nus our partners ocii and rec park on thursday july 20 for Community Event that marks our transfer of bayfront parkos bay and terry front boulevard to the port. The details are coming together tell include residents and stake holders and from 56 30 at Mission Creek at 290 channel street. Im turning to resilience and like to speak about our corrects. Our proposal at pier 3032 received unanimous support from the state assembly Natural Resource commit each ab273. Passed through that. Another important step to realize in the vision for pier 30 that. The project as proposed produce 400 million in investment and matching the entire size 2018 prop abonds for the sea wall. Bill introduced by senator wiener. And it was authorized by the state Lands Commission allows you to consider a project on piers 30 tloochlt with other things, we have numerous amenities proposed. Public walk ways. Open water swimming. Boating and olympic sized pool and retail and tieng i put this project under resilience because of the 400 Million Dollars an incredible victim in addition to the other amenities at the state hearing, i had the opportunity to present. But i was joined by better presenter a swim near boys and girls club and talked about opportunities swimming provide for his life and his enthusiasm to see both a pool swimming and bay Access Facility that would be available for other youth. I look forward to continuing to work on this project with the team and senator wiener and for the benefit of the public, the project proposes office, a private use over water i way to pay for the other amenities this required the state legislator to look at the site and see that was appropriate for our state lands. Back to the resilience program. We will be coming to you next month upon as we talk about the course study and the a departmentation strategies an opportunity to hear about the work produced and rarely landing with the Army Engineers to guide us further along in this process. And as always i want to thank you for your deedcasion to keeping our waterfront clean, safe and vibrant and our Strategic Plan that concludes my report. Thank you. Thank you. Upon great report. We will take opinion comment is there any public regarding the executive directors report . Corey do we have anyone on the phone . There is no one on the phone. Commissioner gilman thank you, director forbes for that and great report and congratulations on the 21 admissible. I know there was a report of oak land who received an award and an announce that is phenomenonal i want to thank the gentleman relation team and joining for his hard work in getting this through. Congratulations and i want to comment on pier 3032 will be a game changer for our waterfront. House pregnant amenities and Affordable Housing which is part of this project. Thank you for your report and excite to see these things move forward. Thank you. Why commissioner lee. No. Great report. As usual and it is good that every month we are moving forward. Congratulations. Thank you. Commissioner harrington. Thank you for the report. Thank you. I. To congratulate nate on his new role. I look forward to working with you. We worked well over the scombreers you are perfect for this job. Congratulations. I mean 21 Million Dollars is just phenomenonal. Because of the work our finance team is doing and the total team of just managing our affairs across the water front and congratulations on the 110 cruise calls. Thats the first since i have been here. We reached the 110. Helping us with our economic recovery is phenomenonal. I there is so much to be thankful for and so much to congratulate the staff on i think we are doing a wonderful job and thank you. Item 10 scene. Dont with blue and gold fleet and worldwide foosd dba cousins main lobster an among to month term to operate a cafe, retail and minifood cart 1, 824 square feet located at 241 on embarcadero. [inaudible]. [interference] item 10 d. Request authorization to advertise bids for construction contract 2796. Beach repairs resolution 2335. Mii have a motion . I move the consent agenda. Is there a second. Okay. I second all the time. You know. [laughter]. I second thank you for this second. We will take Public Comment. Is there any Public Comment in the room regarding consent calendar . Core doe we have anyone on the phone . Thereupon is no one on the phone wish to make comment. Thank you, public ment is closed. All in favor . Aye. Opposed . Resolution. 2332, 33, 34 and 35 are adopted. Next item. Item 11 ais informational presentation to consider a possible action to approve the fiscal year 2023 24 schedule. Parking rates and special event rates parameter rates resolution 2336 and callers who wish to comment dial star 3 to raise your hand to comment. Good afternoon commissioners. Executive director forbes im kim beale the acting Deputy Director for royals and development. Joined by john, Senior Property manager with the port and san tina with upon may have been properties to present a presentation a lot of port staff member who is helped with this report. Jennifer g. And in the market performance. I will discuss the rates proposed incentives and clarifications and end with questions and staffs recommendations. The parameter rates which include schedule. Harbor rates issue land and wourt use rates the current market value and property in the base of delegated authority that gives back enter in property agreements without competitive bid provides the terms confirmed leasing policies of the port. When we go through this process, it is done with staff and a third party consultance team. Reviews and analyzes camperable narcotic dam to provide staff with findings. Look at our leasing activity and review the existing rates. Along with the consultant to determine if a rate should increase, remain the same, decrease and come up with a rental schedule which is attached in the staff report. Iot Consultant Team this year we used either [inaudible] main retail a broker that is subcontracted through [inaudible]. There are turn key space in all classes. Am stimulate leasing lands lords offering free rent. Higher allowances. Furniture. Security deposits and parking. And also upgrading buildings to meet the needs of modern businesses include high Speed Internet and Smart Building system. Industrial Properties Tenant demand remained stable and supply limited majority of construction on Life Sciences and retail. There has been an increase in vacancy and flex space a combination of office, warehouse and retail space. And where the vacancies for logistic space used for distribution and fulfill am centers remains close to longterm average. For hospitality includes food and beverage. They are see a significant or businesses are significantly impacted due to employers adopting full remote or hybrid work policies. There are no hotels on port propertiful we know the Hotel Occupancy increased. As a sign tourism returning. Im looking at the ports performance. Port manages 330,000 square feet of class c and b office there is class a office space on port property, it is managed by master tenants like hudson and ordan. We have about 17. 2 vacancy for Office Higher than the citys rate of 16. 8 for class b and 15. 3 for class c office. Vickancey for industrial our sheds and many have limitations on what you can do with them or in them. Due high docks and older electric system weight limitations is about 11. 9 . Higher than the over all industrial vac analysisy for San Francisco which is 5 . We have parking leases a rate of 6 . Ethernet lease rates not lore than terms up to 5 years up to a Million Dollars and on the boil are plate lease. The largest i will say im sorry the last change was adopt in the august of last year. At which pyle time 115 rate listed april 40 of rates remained the same. 10 decreased and the balance increased slightly. For fiscal 2324 propose to keep the majority the same locations where we might have trouble finding tenants given the current market or may have tenants interested but use is not compatible with when we have to offer. There are 2 locations we are propotion a slight rate increase. And these are locations we have a low vacancy rate or high level of interests. This will impact interior space at the add bodiesing and shed space at pier 453 it does not pertain to fishing use. We are looking at a decrease at round house 2, there is a high bodiesing vacancy one of our office buildings. We are looking to decrease the rates at that location. So. In looking at ways to try to entice tenants to come to port property and retain our existing. We are unable to offer the intentatives some of the landlords are offering in the Public Sector we can provide for longer terms. We are seeing more Office Tenants take advantage of the rate for 2223 and continuing this incentive again as a way to purnew leasing and as a way to retain our existing tenants. Based on the recommendation we would recommend offering a half month free rent for leases 34 years with a ramp up rate this. Tool would be used where if you have a 34 year lease we ramp up your rate to pay 70 of program terand 80 in the second year. 100 in year 3 foreverfor 4 year lease and again wield allow for helpful a month free rent on the anniversary and of the lease term. We are seeing attentives are apprehensive in entering in longterm agreements. So, we would as another tool propose to keep the ability to offer tenants a tomorrowination right if they nernt a lease 34 years and things dont go as nay hoped. They can get out by paying a termination fee equal to a month timers number of years remaining on the lease. Along to accounts for the discount they were given in the early years plus unamtorized leasing incentive and port administrative costs for processing the termination. For shed space with the challenges we are seeing in leasing our shed space due to limitations. Lack of the the challenges with the electrical distribution and the rate incentive would be similar to the it office incentive a half month free rent for lose of 3 years. The tenant able to get a rate above market we split less than 50 of the court this was highlight in the 2021 and not a common scene it would allow us to keep te