City Council
Report
City Council Meeting: February 24, 2026
Agenda Item: 4.B
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To: Mayor and City Council
From: Rick Valte, Public Works Director, Public Works, Airport Subject: Approval of Second Modification to Agreement with Yardi Systems, Inc. for Real Property and Asset Management Software Licensing and Maintenance Recommended Action
Staff recommends that the City Council:
1. Adopt a finding of no possibility of significant effect pursuant to Section 15061(b)(3) (Common Sense Exemption) of the California Environmental Quality Act (CEQA) guidelines; and
2. Authorize the City Manager to negotiate and execute a second modification to agreement #10362 in the amount of $350,000 with Yardi Systems, Inc. for real property and asset management software licensing and maintenance services for the Public Works Department. This would result in a fourteen-year amended agreement with a new total amount not to exceed $600,000, with future year funding contingent on Council budget approval.
Summary
The City of Santa Monica (City) manages 548 leases and license agreements for Cityowned assets and properties, such as offices, hangars, and land leases. These leases are managed by the Airport Division and the Economic Development Division. Since 2017, the City has used Yardi Systems, Inc.’s (Yardi), Yardi’s Voyager®, a proprietary, web-based, comprehensive real estate property and asset management software, to manage commercial real estate operations, execute leasing, run analytics, and provide accounting process services. Although the City Council voted to close the Airport by December 2028, there is a need to maintain the software in the interim and after closure, as City-owned properties at the Airport will still require leasing and maintenance. Staff recommends approval of a second modification in the amount of $350,000, for a new total not to exceed $600,000, and extending the term by five years 2 of 5
as an exception to competitive bidding, pursuant to Santa Monica Municipal Code (SMMC) Section 2.24.280(b).
Discussion
Yardi Systems, Inc. (Yardi) has provided real estate property and asset management software services to the Economic Development Division (EDD) and the Airport Division since January 25, 2017. Staff uses Yardi to execute leasing, run analytics, and provide accounting process services, performing multiple property management tasks including but not limited to: generate courtesy notices to tenants on a monthly basis; record payments, late fees and security deposits collected on a monthly basis; prepare monthend reports on lease/ license agreement monies charged and monies received for submission to Finance; track tenant insurance documentation; track lease/license expiration dates; maintain tenant contact information; and assess Consumer Price Index increases on an annual basis.
Yardi’s Voyager® software is a web-based, fully integrated platform to manage commercial real estate operations, execute leasing, run analytics, and provide accounting process services. Yardi’s Voyager® software database and accounting processing are key features of Yardi that support the management of City owned real estate property assets. Yardi’s software license and hosting fees include critical software updates as well as technical support via Yardi’s toll free phone line. In fiscal year 2024-2025, the Santa Monica Airport added the Facility Manager module, which is a maintenance management software designed to help the City manage property service requests and inspections. Yardi’s Facility Manager software simplifies the property management workflow and improves the tenant experience by automating preventative maintenance, works orders, and inspections.
The City entered into Agreement No. 10362 for licensing and software maintenance, for an amount not to exceed $87,212, covering hosting fees for up to six ledger users and one read-only user at $15,500 annually, subject to the cost-of-living increases and automatic renewal. This agreement was awarded as an exception to competitive 3 of 5
bidding criteria because Yardi Systems, Inc. was the only vendor with the unique capability to meet the software requirements. This agreement also authorized payments for training, with costs prorated between EDD and Airport Divisions based on user count. On February 27, 2018, City Council approved the first modification to Agreement No. 10362 for a new five-year contract total amount not to exceed $106,510. This modification expanded the scope to include additional licenses and changed the anniversary date from January 25 to December 31. In 2019, the City increased its procurement thresholds, and Council approval was no longer required for this type of service up to $250,000.
Staff is requesting approval to amend the current nine-year agreement for an amount not to exceed $59,650 for one year, with five additional one-year renewal options, subject to annual cost-of-living increases (not to exceed 3%) under the same terms and conditions, plus a 10% contingency, for a total amount not to exceed $350,000 over five years. The total duration of this agreement, including this modification, would be up to fourteen years with a not-to-exceed amount of $600,000. For the newly added Yardi’s Facility Manager module, the cost of services depends on the square footage of each property. This square footage fluctuates throughout the year, and thus the 10% contingency would be used to cover any variations in pricing. The EDD and Airport Division recommend a one-year agreement with Yardi to receive critical software updates and support.
Currently, EDD manages 184 leases and license agreements in Yardi, and the Airport manages 364 leases and license agreements, including offices, hangars, and land leases. Due to upcoming projects at the Airport, staff anticipate additional leases will need to be tracked in Yardi over the coming year. Staff recommend continuing to use Yardi’s Voyager® software, as the City’s leasing data and records are fully integrated into this system. Replacing the software would be prohibitively expensive, requiring data migration and staff retraining.
Past Council Actions
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Meeting Date Description
09/27/16 (Attachment A) Authorization to Execute a Contractual Services Agreement with Yardi Systems, Inc.
02/27/18 (Attachment B) Approve First Modification for Property and Assessment Management Software
Environmental Review
The contract modification is categorically exempt from CEQA pursuant to Section 15061(b)(3) of the CEQA Guidelines (the common sense exemption) which states that CEQA does not apply, “where it can be seen with certainty that there is no possibility that the activity in question may have a significant effect on the environment.” The modification will allow the City to continue to utilize its property management software.
Therefore, it can be seen with certainty that the agreement would not result in adverse physical impacts on the environment, and as such, is categorically exempt from CEQA.
Financial Impacts and Budget Actions
Staff seeks authority to approve available funding from the Airport and General Funds to increase the amount of the agreement #10362 with Yardi Systems, Inc. for an additional five years, in order to utilize its real estate property and asset management software to manage commercial real estate operations.
Contract Modification Request
Agreement
#
Current
Authorized
Amount
FY 2025-26
Request
Amount
Future
Years
Amount
Department
Account #
Total Revised
Contract
Amount
10362 $117,707 $19,898 $97,229 01200017.552010 $234,834 $132,293 $39,752 $193,121 57500001.575090 $365,166
Total $250,000 $59,650 $290,350 $600,000
Future year funding is contingent on Council budget approval. 5 of 5
Prepared By: Josephina Lee, Senior Administrative Analyst Approved Forwarded to Council
Attachments:
A. September 27, 2016 Staff Report (web link)
B. February 27, 2018 Staff Report (web link)
C. Yardi Software Agreement
D. Yardi First Modification
E. 3rd Option Renewal Letter
F. 4th Option Renewal Letter
G. First Addendum to Agreement
H. Second Addendum to Agreement
I. Oaks Initiative Form
J. Levine Act Disclosure Form