SAN FRANCISCO HOUSING AUTHORITY 440 Turk Street • San Francisco CA • 94112 • (415) 554-1200
May 13, 2010
SAN FRANCISCO HOUSING AUTHORITY COMMISSIONERS
Presented By: Barbara T. Smith, Housing Development & Modernization Administrator and George Gager, Development & Modernization Manager Subject: RESOLUTION AUTHORIZING THE EXECUTIVE DIRECTOR TO NEGOTIATE AND EXECUTE AN AGREEMENT WITH STARBOARD TCN TO ACT AS LEASING BROKER FOR THE AUTHORITY’S VACANT SPACE AT 440 TURK STREET FOR AN AMOUNT NOT TO EXCEED NINE PERCENT OF THE RENT TO BE RECEIVED OVER THE INITIAL LEASE TERM BUT NOT TO EXCEED $500,000
BACKGROUND This resolution authorizes the Executive Director to enter into an Agreement with Starboard TCN to act as the Authority’s Leasing Broker for the vacant office space at 440 Turk Street in San Francisco. An RFP was issued seeking the services of a Leasing Broker and two firms responded and were interviewed by staff. The selected firm was rated firm was rated the highest for both its capabilities and price. HUD Guidelines HUD permits PHAs to lease their vacant non-residential space to unrelated third parties without specific HUD approval, even if that space is covered under the Authority’s Annual Contributions Contract. The rental proceeds do not have to be treated as program funds and may be used for a wide variety of purposes. A PHA may hire a real estate broker to assist in the search for a tenant for such vacant space. ANALYSIS The Starboard TCN Proposal The Starboard proposal provides for a below market commission rate of nine percent and Starboard has agreed to absorb the cost all marketing, advertising, print ads and internet advertising as set forth in their Marketing and Advertising Plan. Any options by the tenant to renew or extend a lease shall be excluded from the calculation of any commission. Terms of Lease The terms of any future lease for all, or any portion, of the space available at 440 Turk Street will be presented to the Board of Commissioners for authorization and approval prior to signing. No Leasing Commission shall become due or payable without the consent of the Board of Commissioners.
DEPARTMENT’S REQUESTED ACTION Staff recommends approval of this Resolution. EXECUTIVE DIRECTOR’S RECOMMENDATION I concur with the requested action
RESOLUTION NO._______________ DATE ADOPTED: _______________ RESOLUTION AUTHORIZING THE EXECUTIVE DIRECTOR TO NEGOTIATE AND EXECUTE AN AGREEMENT WITH STARBOARD TCN TO ACT AS LEASING BROKER FOR THE AUTHORITY’S VACANT SPACE AT 440 TURK STREET FOR AN AMOUNT NOT TO EXCEED NINE PERCENT OF THE RENT TO BE RECEIVED OVER THE INITIAL LEASE TERM BUT NOT TO EXCEED $500,000 WHEREAS, the objective of this resolution is to obtain Commission approval for the Executive Director to enter into a contract with outside Real Estate Brokerage firm of Starboard TCN to act as the Authority’s Leasing Broker for its vacant space at 440 Turk Street; WHEREAS, the Authority solicited proposals for these Brokerage services Starboard TCN submitted the most favorable response to the Request For Proposals issued by the Authority. future financing options may include, but are not limited to: Build America Bonds, the HUD Capital Find Financing Program, the HUD Operating Fund Financing Program, the HUD Public Housing Mortgage Program, Section 30 Financing and ESA financing; WHEREAS, the Authority solicited proposals for these Brokerage services and identified two highly qualified local Real Estate Leasing Brokerage legal firms; WHEREAS, such services will help improve the financial strength and stability of the Authority. NOW, THEREFORE, BE IT RESOLVED BY THE COMMISSION OF THE HOUSING AUTHORITY OF THE CITY AND COUNTY OF SAN FRANCISCO THAT:
1. The Executive Director is authorized to negotiate and execute an agreement with starboard TCN to act as leasing broker for the Authority’s vacant space at 440 Turk Street for an amount not to exceed nine percent of the rent to be received over the initial lease term but not to exceed $500,000.
2. This Resolution shall take effect immediately. APPROVED AS TO FORM AND LEGALITY: __________________________________ Tim Larsen, Acting General Counsel
Henry A. Alvarez, III, Secretary/Executive Director Date: