TO: Board of Supervisors
FROM: Steven Lederer, Director of Public Works
REPORT BY: Mark Witsoe, Airport Manager
SUBJECT: Lease Agreement No. 230234B with SkyserviceUS California, LLC. - Approve Second Amendment
RECOMMENDATION
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Approve and authorize Amendment No. 2 to Lease Agreement No. 230234B with SkyserviceUS California LLC. (Skyservice) to adjust square footage and total compensation to lease areas, change adjustments to base rent, to add Fuel Farm Infrastructure Improvement reimbursement to County, to extend development timelines, and to replace Exhibits. (Fiscal impact: $146,890 Revenue; Airport Fund; Not Budgeted; Discretionary)
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BACKGROUND
Lease Agreement No. 230234B with Skyservice for Fixed Base Operator (FBO) services and development was approved by the Board on December 6, 2022. In summary, the lease agreement provides a term of thirty (30) years with an option to extend for up to two (2) consecutive five (5) year periods; includes approximately ten (10) acres of ground lease and a 20,000 square foot commercial hangar; requires payment of fuel flowage fees and a tax minimum annual guarantee; requires minimum capital investment of $13.6 million for infrastructure development including a terminal, commercial hangar, and fuel farm; and requires construction of commercial restaurant space within its terminal. Amendment No. 1 to the Agreement was executed on March 21, 2023 to adjust the square footage of the commercial hangar from 20,000 square feet to 18,500 square feet, based upon actual measurements.
Since December 2022, Skyservice has been involved in planning for development of their ground lease space. They have justified their interest in expanding the width of their ground lease premises by 30 feet to accommodate their planned corporate aircraft storage hangars, FBO lobby, and restaurant. The additional 30 feet would be added to the north side of their existing lease. In addition, as part of their required work to develop a fuel farm,...
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