December 16, 2025
Economic Development
PORT
DATE: December 16, 2025
TO: Mayor Martinez and Members of the City Council
FROM: Charles Gerard, Port Director
Kyle Lam, Management Analyst
Subject:
Construction Agreement with Penkor Wrecking for
Selective Demolition and Site Security at Terminal 1
FINANCIAL IMPACT: The proposed $283,000 expenditure is funded with Port Enterprise Fund unrestricted fund balance. The budget
for the Port Enterprise Fund will be increased by
$283,000 (Account String: 40162480 – 400538).
PREVIOUS COUNCIL
ACTION:
None.
STATEMENT OF THE
ISSUE:
A fire in April 2025 damaged the interior wood framing of the Terminal 1 warehouse, creating openings in the
structure that require demolition and security work. City staff are requesting City Council approval of a contract with Penkor Wrecking to perform selective demolition and site security improvements at the City-owned portion of Terminal 1.
RECOMMENDED ACTION: ADOPT a resolution to APPROVE a construction agreement with Penkor General Contracting dba Penkor
Wrecking for selective demolition and site security
improvements at Terminal 1 warehouse, in an amount
not to exceed $283,000, for a term ending June 30, 2026; and APPROPRIATE $283,000 from the Port Enterprise
Fund to fully fund the project – Economic
Development/Port (Charles Gerard 510-620-6792).
AGENDA
REPORT
December 16, 2025
DISCUSSION:
On April 30, 2025, a fire occurred in the vacant Terminal 1 warehouse located at the end of Dornan Drive and Brickyard Cove Road. The fire was confined to the western portion of the warehouse, which contained interior wood framing. The exterior structure was not damaged. Following the incident, the City’s insurance representative recommended removing the fire-damaged interior materials and securing the building’s perimeter.
The proposed project includes removing all remaining wood framing from the west side of the building. During firefighting efforts, the Fire Department cut open the metal roll-up doors, leaving the structure vulnerable to trespass. To prevent unauthorized entry, the project will install fencing to secure the doors, as well as any open windows and wall openings.
The City of Richmond has fee title ownership to the southern portion of Terminal 1 (APN 560-420-007), while fee title to the northern portion (APN 560-420-010-4) remains held by Terminal One Dev LLC. The fire occurred within the City-owned portion, where the majority of the proposed security work is needed.
In early October, the Port released the project for public bid through the City’s Bids Online procurement system (Attachment 1). On October 30, 2025, the Port received five proposals:
Contractor’s Name Location Bid Value
KK Contracting, Inc. San Francisco $447,500
Penkor Wrecking San Lorenzo $283,000
Nema Construction Albany $323,630
Rubicon Builders Sonoma $370,000
S&H Construction Fremont $434,600
Upon review of the proposals by City staff members, the lowest, responsive, and responsible bidder was determined to be Penkor General Contractors, Inc. (doing business as Penkor Wrecking). The proposal includes a $280,000 base bid and a $3,000 additive alternate to remove contaminated wood, if found during construction.
The Port recommends awarding the construction agreement to Penkor Wrecking.
This was an unplanned expense and is not included in the Port’s approved Fiscal Year 2025–26 Budget. An appropriation of $283,000 from the Port Enterprise Fund is required to complete the work.
City staff members recommend that the City Council adopt a resolution approving a construction agreement with Penkor General Contracting, dba Penkor Wrecking, for selective demolition and site-security improvements at the Terminal 1 warehouse, in an amount not to exceed $283,000 for a term ending June 30, 2026 (Attachment 2 and 3).
December 16, 2025
City staff members further recommend appropriating $283,000 from the Port Enterprise Fund to fully fund the project.
ENVIRONMENTAL REVIEW:
As this is repair and maintenance work, the project is exempt from the California Environmental Quality Act.
DOCUMENTS ATTACHED:
Attachment 1 – Terminal 1 Selective Demolition and Site Security Specifications Attachment 2 – Resolution
Attachment 3 – Construction Agreement