1 CITY MANAGER’S OFFICE
CITY HALL
10300 TORRE AVENUE • CUPERTINO, CA 95014-3255
TELEPHONE: (408) 777-3212
CUPERTINO.GOV
CITY COUNCIL STAFF REPORT
Date: October 20, 2026
Subject
Proposed approach for leasing the City-owned commercial property at 22100 Stevens Creek Boulevard.
Recommended Action
Receive the update regarding the expiration of the current lease for the City-owned property at 22100 Stevens Creek Boulevard, and provide direction on the proposed approach for future use and leasing of the property.
Background
Property Overview
The Blue Pheasant Restaurant has operated at the City-owned property at 22100 Stevens Creek Boulevard since 1974. The City’s current commercial tenant has operated the restaurant and leased the property since 2004. The current commercial lease expires on November 30, 2026, and the tenant has indicated that he does not intend to personally renew the lease. Upon expiration of the lease, the commercial space will become vacant and available for lease.
The property is zoned Park and Recreation (PR). Permitted uses within the PR zoning are listed in CMC 19.84.020 and include outdoor recreation, gardening, playgrounds, and parks. On March 19, 2013, the Council determined that the restaurant and bar use at the Blue Pheasant Restaurant qualified as a permitted accessory facility. Other accessory facilities and uses customarily incidental to permitted uses are also permitted.
The commercial space is located at the entrance to Blackberry Farm Golf Course (see Attachment A for Vicinity Map). The City operates the Blackberry Farm Golf Course Pro Shop in the same building. The approximately 6,800-square-foot commercial space includes a kitchen, bar, banquet room, office, and restrooms, as well as non-exclusive use of 92 parking spaces in the adjacent parking lot.
The City’s objectives for the property include activating the space; securing an experienced and financially capable operator; ensuring compatibility with Blackberry Farm Golf Course and the 2 surrounding neighborhood; obtaining a reasonable economic return; minimizing City capital investment; and providing an overall community benefit.
Proposed Solicitation Process
Should the Council desire to continue leasing the space to a commercial tenant, City staff would use a Request for Proposals (RFP) process to identify a new tenant. After considering the options outlined in the City’s purchasing policy, staff determined that an RFP is the preferred solicitation method because it provides a structured approach for evaluating proposals based on the City’s objectives for the commercial space. The process would include targeted outreach to the business community to reach prospective tenants who may not typically receive City RFP notifications. Staff will publicize the opportunity through the City website and commercial real estate platforms and leverage the Economic Development Committee to assist with outreach. 1 The RFP process will include an optional informational meeting and an open house tour before the submission deadline, giving prospective tenants an opportunity to ask questions, view the commercial space, and learn about the City’s leasing opportunity. Proposals will then be evaluated through a two-phase process consisting of an initial review of written proposals followed by interviews and oral presentations.
Potential Uses
Staff anticipates structuring the solicitation to allow proposals from restauranteurs, food and beverage providers, and other compatible commercial operators. Potential uses that could be considered accessory include full-service restaurants, cafés, banquet and event facilities, recreation-related businesses, or other community-serving uses. Council may provide direction regarding whether particular types of businesses or uses should be prioritized or excluded from consideration. Proposed uses would be evaluated for consistency with applicable zoning requirements.
Evaluation and Lease Approval
Proposals will be evaluated based on factors such as the prospective tenants’ qualifications, the proposed use, relevant operating experience, financial capacity, compatibility with Blackberry Farm Golf Course and the surrounding area, anticipated economic return, and the overall benefit to the City. Following the evaluation process, the City will initiate lease negotiations with the highest rated proposers. Staff will then return to the Council for consideration and approval of a proposed lease agreement.
Transition and Council Direction
Upon expiration of the current lease, staff will evaluate the condition of the commercial space and identify any building improvements that may be necessary before occupancy by a new tenant. Depending on the proposed use, improvements may also be required as part of future
3 tenant improvements and permitting. Responsibility for such improvements will be addressed as part of lease negotiations.
During any vacancy period, the City will secure and maintain the commercial space while continuing operation of the Blackberry Farm Golf Course Pro Shop. The timing for occupancy by a new tenant will depend on the solicitation and selection process, lease negotiations, required approvals, tenant improvements, and permitting.
Before initiating the solicitation process, staff is seeking Council feedback and direction on the proposed approach for a new commercial tenant. If the Council prefers a different use of the space, tenant profile, or solicitation approach, staff can revise the process consistent with Council direction.
Sustainability Impact
No sustainability impact.
Fiscal Impact
The City currently receives approximately $80,625 annually in base rent, plus six percent of the tenant's gross sales, which has generated approximately $30,000 annually in additional revenue.
Upon expiration of the current lease, the City will experience a temporary loss of lease revenue until a new tenant begins paying rent and is operational. The fiscal impact will depend on the length of the vacancy period, the level of City capital investment, and the terms of the future lease agreement; however, once a tenant is secured, the fiscal impact is expected to be positive.
Alternatively, Council may direct staff to explore short-term leasing opportunities, City operation of the facility, or additional feasibility analysis before proceeding with a solicitation.
City Work Program (CWP) Item/Description
None.
Council Goal
Quality of Life.
California Environmental Quality Act
No California Environmental Quality Act impact.
_____________________________________
Prepared by: Daniel Degu, Economic Development Manager
Reviewed by: Chad Mosley, Director of Public Works
Kirsten Squarcia, Deputy City Manager
Floy Andrews, Interim City Attorney
Approved for Submission by: Tina Kapoor, City Manager
Attachments:
4 A – Vicinity Map