4th/5th/ARIZONA FACT SHEET
1301 – 1333 4th Street and 1302 - 1334 5th Street
Site: 112,000 square feet (2.5 acres)
Ownership: City owns the properties at 1302 - 1334 5th Street, purchased for $36 million in 2007 and 2009 with Redevelopment Agency funds. City purchased 1301 – 1333 4th Street for $42.5 million in 2010 with Redevelopment Agency funds and is still paying off this purchase through 2042 (see Debt Service notes below).
Tenancy:
Tenant Address Annual Rents Lease Term
Bank of America 1301 Fourth Street $1.5 million February 28, 2026 Chase Bank 1333 Fourth Street $1.1 million April 30, 2028 EvGo Electric Charging Station Parking Lot 27 $31,000 July 31, 2027 Annual Rental Revenues: $2,500,000 appx
Debt Service: Years 2013 – 2029: $3.3 million per year
Years 2030 – 2034: $3.4 million per year
Years 2035 – 2039: $3.5 million per year
Years 2040 – 2042: $3.6 million per year
*City continues to collect tax increment in these amounts to cover debt service.
Zoning And FAR:
Address/Existing Uses Zoning FAR Land Area
(sf)
Proposed Density Unit Capacity
1301-1333 4th St
(BofA, Chase Bank)
BC – Bayside Commercial 4.0 (100% Affordable Housing)
3.5 (Mixed Income Housing)
52,489 150 units/acre 181
1324 5th St
(Parking Lot 27)
NV – Neighborhood Village 4.5 (100% Affordable Housing)
4.0 (Mixed Income Housing)
52,470 150/units/acre 181
Housing Element Commitment of Affordable Units at this
Site:
Minimum of 362 affordable housing units
Considerations and/or Constraints: 1) The BofA and Chase leases expire in 2026. Both tenants desire operating at current location as long as feasible. And both banks have indicated, separately,
that an extension providing a term of 5-years, at
minimum, is ideal for operational and planning needs
as banks typically need 2-yrs “lead time” to relocate.
2) Chase offered additional rents in exchange for an
extension. In July 2024, Council approved a lease
extension for Chase Bank that provides an additional
2-yrs (through 2028). The extension was structured
for 2-yrs as Council’s deliberations on which Cityowned sites should be redeveloped first was still pending.
3) On January 7, 2025, Bank of America submitted a
proposal seeking a 5-year extension with 2 options to
extend the lease.
4) Rental revenues from the two bank tenants currently
generate over $2.5M to the City’s General Fund
annually. As triple net leases, the City does not incur any costs related to utilities, maintenance or taxes
related to these two tenancies. If the 4th/5th/Arizona
site is redeveloped after other City-owned sites, City
staff can negotiate lease extensions with higher rental rates to provide much needed revenues for the
General Fund.
5) If the bank leases are not extended, it is anticipated the two properties will remain vacant until
redevelopment in commences. The General Fund
would forgo approximately $13m in lease revenues if
the term for both tenants is not extended by 5-years.
6) Consider a viable, revenue-generating use such as a
hotel.
7) Interim Activations on Site – ICE, roller skating + other pop-up activations. DTSM and community desire to
retain some flexible outdoor space on site for future
community activations.
BERGAMOT STATION ARTS CENTER FACT SHEET
2525 Michigan Avenue
Site: 224,000 square feet (5.6 acres)
Ownership: City purchased the site for $17.3 million in 1989 with Big Blue Bus Rail Reserve funds.
Zoning: Bergamot Area Plan– Conservation Arts Center (CAC) FAR: 3.0 (100% Affordable Housing)
2.5 (Mixed Income Housing)
Housing Element Commitment of
Affordable Units at this Site:
707 affordable housing units (150 units/acre)
Tenants: Approximately 30 small businesses: art galleries, non-profit theatre company, comedy club and restaurant within five buildings (approximately 62,000 SF of building space).
Lease Term: One-to-three year leases, renewed annually (Jan 1st). Staff will be seeking Council approval to authorize several leases that fall above the $250,000 per annum threshold (at 2/25/25 Council meeting).
Annual Gross Rental Revenues: $1,600,000 appx
Annual Repayment to Rail Reserve
Fund (Big Blue Bus):
$660,000 appx
Annual Operating + CapEx Expenses: OPEX approximately $950,000 annually CAPEX $300,000- $500,000/yr (subject to available funds and capital improvements required)
Considerations and/or Constraints: 1) Relocating existing tenants and creating a viable plan for relocation. 2) Artist housing as part of the affordable units
a. Currently meetings and site visits with existing affordable housing artist communities and those developers to gather ideas before release of RFP
3) Evaluate revenue impacts to BBB
4) Background: extensive community engagement process in the past where community anticipated a boutique art-themed hotel w/ restaurant/gallery/event space, creative office, museum venue, bike center + shared parking structure (and no housing was contemplated at that time) with some building preservation (e.g. “B” Building + portion of “A” Building). Many community members still have this historical context and were actively engaged in that past process and will expect to be involved in an upcoming RFP.
Deferred Maintenance challenges including termite remediation, Sewer and septic tank repairs, building weatherproofing, vehicular gate and parking management system
5) Capital Improvements – considerations for investment required to continue day-to-day operations for next 3 years vs. 5-10 years a. Property assessment – challenging to operate with aging infrastructure and limited funding due to rent cap
b. Adhering to present-day Federal and State Building Code requirements, which are triggered by tenant improvements c. Buildings E and F - Roof replacement and weatherproofing d. Parking surface paving and striping
e. Irrigation system
f. Sewer connection to replace septic system
g. Stormwater system
6) Property Management + Staffing– Current operations rely on an external property management company and are subject to high staff turnover due to intense political environment and tenant expectations. The service at approximately $210,000 per annum (fee and reimbursables) is reimbursed by tenants via monthly Common Area Maintenance (CAM) charges and requires City subsidization to help offset expenses. In addition, Bergamot operations require City staff support (4 FTE in Economic Development and Community Cultural Services) and support from Arts Commission (to help vet future tenants).
MAIN STREET PARKING LOTS FACT SHEET
Public Parking Lots 9, 10, 11
Site: 167,388 square feet (3.84 acres)
Ownership: City-owned surface parking lots
Zoning: R3-A, R4-A
Maximum Allowable Density: R3: 35 units/acre (no FAR)
R4: 48 units/acre (no FAR)
Housing Element Commitment of
Affordable Units at this Site:
577 affordable housing units (150 units/acre)
*minimum of 5 stories needed to achieve this # of units Existing Parking Spaces 339
Tenants: • Victorian leases the parking lot behind the business Annual Revenues: • Average annual parking revenue of approximately $800,000 • Adjacent Victorian/Heritage Square businesses generates approximately $450,000 in annual lease revenue
Considerations and/or Constraints: • Located in Coastal Zone • Public parking lots support Main Street businesses and coastal access – how much of parking will be replaced
• May require renegotiation of existing lease with City tenant(s) on adjoining properties (e.g. The Victorian), which expires in 2028 (or 2033 if final 5th option is approved by both parties)
• Main Street Farmer’s Market is located on one of the surface lots • Sites are long and relatively narrow
• Needs an environmental feasibility analysis of the sites • Tree Replacement
• Shared Garbage Containers for the Main Street Businesses