Resolution approving and authorizing the Director of Property, on behalf of the City and County of San Francisco, to execute the second amendment to the lease of 11,085 square feet of office space at 3119, 3125, and 3127 Mission Street, from KLW Investments, LLC, a California limited liability corporation; extending the term by four years and six months from March 31, 2026, for a total term from, July 1, 2015, through September 30, 2030, and granting a five year option to renew the lease, at an annual base rent of $410,145 for continuing use by the Human Services Agency; and authorizing the Director of Property to enter into any additions, amendments or other modifications to the lease that do not otherwise materially increase the obligation or liabilities of the City to effectuate the purposes of the lease and this Resolution.

This resolution approves a second amendment to the lease for 11,085 square feet of office space at 3119, 3125, and 3127 Mission Street, used by the Human Services Agency (HSA). The amendment extends the lease term by four years and six months, from March 31, 2026, to September 30, 2030, and includes a five-year option to renew.

Financial Details:

• The annual base rent is set at $410,145, effective retroactively to September 15, 2025. This represents a 20.2% reduction from the previous annual rent of $513,773, resulting in an annual savings of $103,628 for the City.
• Rent will increase by 3% annually starting March 1, 2027.
• A rent credit of $56,131.60 (accrued between September 15, 2025, and April 1, 2026) will be applied to tenant improvements at 3120 Mission Street, another property leased from the same landlord. The 200% holdover rent for the period between the previous lease expiration (June 30, 2025) and the new effective date is waived.
• The total term obligation for the extended lease is $1,950,994.29.

Purpose:

• The lease ensures HSA's continued operation of essential services, including Workforce Development, CalWORKs, MediCal, CalFresh eligibility, and Family and Children’s Services, in the Mission District. The location has been an established presence for over 10 years and is accessible by public transit.

Compliance & Other Provisions:

• The amendment incorporates updated provisions regarding non-discrimination in City contracts, prevailing wages for covered projects, and limitations on campaign contributions for contracts exceeding $100,000.