Introduction of Ordinance to Approve
Two Leases with Kai Concepts, LLC for
a Portion of Building 168 and a Portion
of Pier 1, Located in Alameda Point
January 20, 2026
map_20231012 (2)
Proposed Leased Premises
Encinal HS
W. ORISCANYPIER 1
VIKING ST
B168
Building 168 - 1651 Viking Street
Natel Energy
• Former Navy storage warehouse,
located at 1651 Viking Street in
Alameda Point
• Built in 1946
• Located within Enterprise District
• Non-historic structure and not within
tidelands
• Conveyed to City in 2013
• B168 is divided into two suites (City's
other tenant is MARAD)
Building 168
• Lease Includes approximately 28,636 SF of interior space and 17,270 SF of adjacent yard space
Pier 1
Natel Energy
• Located within Enterprise District
• Conveyed to City in 2016
• State Tidelands property
• Not contributing historic structure
Encinal HS
• Located on South side of Seaplane Lagoon
• Non-exclusive use of a portion of the pier
for launching and retrieval of watercraft
• Power Engineering also leases the pier (no
conflicts of uses)
Pier 1
Pier 1
Kai Concepts, LLC.
5 Kai Concepts has been operating at Alameda Point since 2013 and has remained a tenant in good standing
• The Alameda Point business employs a professional
team of engineers, sailors, and software developers.
• They build and test Kites for large-scale propulsion in waterborne transportation and E-Foils for water
sports innovation.
• The adjacency of B168 to Pier 1 provide efficiency for the business in developing and testing watercraft
designs.
• Kai's use is consistent with General Plan policies for Alameda Point and the Enterprise-1 subdistrict and
consistent with the Alameda Municipal Code zoning
requirements for the premises.
• Current lease for B168 expired October 2025, and
Pier 1 license expired August 2025
Use: Warehouse, beverage distribution, food grade equipment leasing, maintenance and repair, beverage bottling, and retail fountain bar
Premises: Interior space plus non-exclusive vehicular access and parking & exterior yard area Term: twenty-five (25) months to be coterminous with adjacent leases.
Rent: $14,198 per month w/ 3% increase in year 2.
Tenant pays share of all services, utilities and taxes (including possessory interest taxes) As-is condition, no-rent credits
New Lease Terms
• Use: Research and development of kite powered
watercraft
• Premises: 28,636 SF of interior space, 17,270 SF
exterior space at B168, plus a non-exclusive
portion of Pier 1 used to launch and retrieve
watercraft
• Term: 60-months (5 years) w/ no renewal option
• Monthly Base Rent: $27,150 combined (building
and pier) w/ annual 3% increases
• Increase of 3% over current (combined) Base Rent
• Tenant is responsible for all utilities, taxes and fees • City has exclusive Right to Terminate occupancy of B168 with six (6) months prior notice; Pier 1 lease includes a relocation right with 90-day notice to allow flexibility for future uses. • Lease rate reflects fair market value (FMV) for the use, given the shorter-term duration and City’s termination right Months
B168
Monthly Rent Annual Rent
Pier 1
Monthly Rent Annual Rent
1-12 $23,000 $276,000 $4,150 $49,800
13-24 $23,690 $284,280 $4,275 $51,300
25-36 $24,401 $292,812 $4,403 $52,836
37-48 $25,133 $301,596 $4,535 $54,420
49-60 $25,887 $310,644 $4,671 $56,052
Total Base Rent for B168 & Pier 1 use over full 5-year term: $1,729,740 Approve the first reading of the ordinance authorizing the Interim City Manager to execute the two new leases for B168 and the non-exclusive portion of Pier 1, with Kai Concepts on the terms described in the staff report.
Recommendation
• Contributes significant base lease revenues of $1,729,740 over five years, supporting the operating expenses of City-owned Alameda Point properties. • Provides space for existing, long-term tenant in good standing, to perform blue tech and maritime R&D in alignment with the City’s Economic Development Strategic Plan.
• The shorter-term nature of the lease and termination right will not interfere with the City’s plans for future redevelopment of the Enterprise District with more job- intensive uses. This would be one of the later-to-develop areas due to its western location.
• Tenant will continue to maintain the premises as occupied, thus reducing security concerns at Alameda Point.
Rationale