Resolution approving Port Commission Lease No. L-17378 with Dylan’s Tours, Inc., a limited liability company, for approximately 1,505 square feet on the ground floor of a two-story building located at 490 Jefferson Street for a term of five years to commence on May 1, 2026, through April 30, 2031, for an initial annual base rent of $72,000 with 3% annual increases and one five-year option to renew.

This resolution approves a five-year lease (May 1, 2026 - April 30, 2031) with Dylan’s Tours, Inc. for approximately 1,505 square feet on the ground floor of the building at 490 Jefferson Street. The lease includes one five-year option to renew, making the total potential term 10 years, which requires Board of Supervisors approval.

Key Financial Terms:

• Initial annual base rent: $72,000 (or $6,000/month), increasing by 3% annually.
• Percentage rent: 5% of Gross Revenues over an annual breakpoint of $900,000.
• Additional staging space for one tour vehicle: $375/month.
• Port will provide a Tenant Improvement (TI) Allowance of up to $320,000, plus a 10% contingency ($32,000), totaling $352,000, for tenant-led improvements.

Context and Impact:
This lease is part of the Port's strategy to address long-standing retail vacancies in Fisherman's Wharf. The building at 490 Jefferson Street has been vacant for approximately 15 years and is considered blighted. Dylan’s Tours, an established local tour and bicycle rental company, is expected to activate the space, attract visitors, and support nearby businesses. The Port is also undertaking hazardous materials remediation (mold, asbestos, lead paint) in the building prior to tenant improvements. The second-floor office space is not included and remains available for lease.