Introduction of Ordinance Approving and Authorizing the City Manager to Execute Documents Necessary to Implement the Terms of the Lease with Wrightspeed, Inc., a Delaware Corporation for a Lease for Seven Years with Two Five-Year Options and an Opportunity to Purchase Building 41 Located at 650 West Tower Avenue at Alameda Point. (Base Reuse 819099)
6 p.m. introduction of ordinance approving and authorizing the city manager to execute documents necessary to implement the terms of the lease with right speed. A Delaware corporation for the lease of or a lease for seven years for two five year options and an opportunity to purchase building 41 located at 650 West Tower Avenue, Alameda Point. Good evening, Mayor and Councilmembers. I'm Nanette Mchunu and the Community Development Department. Tonight, you'll be considering a lease for seven years with two five year options and an opportunity to purchase for Building 41, located at 650 West Tower. Before we get into the details of the lease, I'd like to tell you a bit about the leasing program at Alameda Point. Just a little brief overview. We've been doing leasing in Alameda Point since 1997 under the large parcel lease, and now we own a significant portion of the property. And there are still some pieces that are under what we call the life arc, which is the lease in furtherance of convenient. In the early years of the of our leasing program, we generated about one and a half million dollars. That revenue fund has grown to approximately $12 million today. That's the projected revenue. We have approximately 66 commercial tenants. I'm going to show you a little bit just for your visual of the leased spaces, the negotiations, the things that are under negotiation right now and the available spaces. This is this gives you kind of a taste of who what's out there and how much of the property is occupied. And then finally, I just wanted to tell you that we have a 66 commercial tenants with approximately. 002. Goodby with approximately 1000 employee employees. And I wanted to just show you some of the logos from the tenants that are out there, and they run from small one office one day games to Google Waterfront users from Ocala, Connie out outrigger canoe to the Department of Transportation and Maritime Administration Ready Reserve Fleet. We've created a significant and diverse tenant mix and hope to add right speed to to that list. Tonight, I want to tell you that we're I'm really excited to bring right speak to you tonight. They found Alameda point by way of conversations with an existing tenant mechanic mechanic power who is now Google developing cluster industry and is a key component of the city's asset management strategy, which was developed in 2010, developed and approved in 2010, and that seeks to build on the foundation of existing businesses and create complementary industry and synergy. Job creation is one of the overarching goals of the asset management plan. Right. Speed will be taking over a building that's been vacant since the base was closed back in the late 1990s. Building 41 was originally part of the Alameda Naval Air Museum's portfolio, but the then art governing body decided that it was a very desirable building, very leasable building, and we took it out of that portfolio and it has sat vacant until hopefully to it tonight when you make a decision to put right speed in there. Because of the significant investment needed to be put in that building, it's pretty much that vacant. But tonight, Ian Wright, who is a principal who will be making a brief presentation for you tonight, will talk to you about the investment that they plan on putting in the building, which is more than $2 million. They say they expect to bring at least 150 new jobs to Alameda Point. And I'm going to turn this over to Ian so he can tell you more specifically about himself, his product and what he hopes. Right. Speaking out for the city of Alameda. Good evening and welcome to the New City Council. I'm Ian Wright, founder and CEO of Wright Speed. I'm actually a New Zealander and I was out on the bay watching the America's Cup, sadly. But I made my home in Woodside, California, 21 years ago. I'm an engineer and a serial entrepreneur. The last company that I co-founded was Tesla motors, which has turned out pretty well for investors and employees and customers. And they've made their home in Fremont. Right. Speed is located in San Jose in the heart of Silicon Valley. It's a location that some of my employees describe as soul sucking. I actually own two houses in Alameda and I want to move the company here. I signed a lease to that effect and then they'd asked me to explain a little bit about why we want to move to Alameda. And I guess the first reason is that that I love Alameda. I think it's a fantastic city. And I think my people will as well, the employees I have and the employees that I'm going to hire. It's just a wonderful city. We are 23 people today and we're planning to grow to 300, roughly 300 people, 2018, 303 50 people. Right now, we're recruiting as fast as we can, and we're finding that it's difficult to attract people from this area to San Jose. They don't want to drive down at 80. I'd rather come here. I already have three employees that live in this area. This UC Berkeley. Locally, there's a lot of people around here, even people in the city. You go out to 880. The science is 11 minutes to downtown S.F.. Yeah. So that's one reason recruiting people, I think, will be the people that we want will be easier here. Then there's Building 41. It's an iconic building. It's we think it's lovely. We'd love to preserve it the way it is. Use it the way it was designed to be used. We have an unusual requirement. We have a lot of engineers. We have a lot of office staff that work in nice offices with workstations and of the way you can close and a whiteboard. Lovely stuff. Then we have a workshop where we bring in big trucks and we pull them apart and we design electric powertrains for them and we work on those. We need 25 foot ceiling height. We need space. It's very hard to find a building that will do both of these things. Building 41 is perfect for that. And then the last reason that we'd like to move here is that I've actually been working on the steel for a year now, and I've found everyone I've met at the city of Alameda has just been wonderful to deal with, and I'd like to continue doing that. Okay. So the slide show, I'll tell you a little bit about what we do. We're a clean tech company. We make the most advanced fuel saving vehicle technology in the world. So what we actually make is electric powertrains for trucks. We sell them as a repair kit. Alex is the lead customer. We also are selling these our train kits into garbage trucks. And our first customer for that is actually in the North Bay. They do Sonoma and Marin Counties where of course, love to do this for Alameda County as well, besides making them very quiet. And I think that's going to be a big deal. If you ask people at random, what time does your garbage get collected, they can tell you because it wakes them up. You make those trucks electric, that can be very much quieter. But besides that, it reduces the emissions by fantastic amounts to stick particulates by 93%. And of course, they save enough fuel to pay for themselves in less than four years. The average Class eight garbage truck in the US earns $55,000 a year in fuel and $30,000 a year in maintenance. And we can save most of that. Clean tech I think is a good match for Alameda. Social currency for customers, employees. Suppliers. Community. I spend half of the afternoon with the Chamber of Commerce. There's a surprising amount of local industry that matches with what we need, and we need to hire a lot of people. Bringing jobs, restoring the building, which is and then it points out, has been vacant since 97. The roof is leaking. It requires. We're planning to put about $4 million into getting that building to the point where it works for us. That's we want wanted to. Okay. Yep. So these are actually real people in my company doing real work. This is the kind of thing they do. It's what it looks like. These are the kind of jobs we need to add. A lot of engineering work, assembly testing, supply chain, logistics. You know, we are a manufacturer, but we outsource the actual, you know, forging and casting and machining. And we outsource electronics manufacture to contract manufacturers like San Mina. We get all the stuff in, we assemble powertrain kits, we ship them out to where they're going to be installed in a truck. So we don't do that installation process here. We do development work here. We do some testing work here. We do supply chain work. We support customers. But to calibrate it for you, when we're at about 100 million a year revenue, that's about one and a half tractor trailers worth of shipping crates leaving the island . That's $100 million a year. That's how much stuff we're talking about that arrives, gets assembled, software loaded, tested, shipped out. So it's high value, low volume stuff. And those are actual employees arriving at work. Yeah. So that's 109,000 square foot building. We don't need all of that immediately. So in the lease with the city, we can sublease some of that. We can use this as an incubator. We're actually quite well known in the in the community of people who do this kind of thing. And we've already had people approaching us to sublease some of the space for incubators to start other companies. And you've had some success with this in Alameda already. I mean, this company, Ann Arbor Bay, that was 20 people five years ago. And there's now 500 people or something. You've had Makani Power, which has become Google. So I know about it. It's a business. The business thing is not retail, so it generates local sales tax revenue. And of course, people. Thank you very much. Thank you. Hmm. Actually, do we have speakers on the side besides yourself? All right. Members of. Yes. Thank you, sir, for your concise presentation. I was taking furious notes as to why you wanted to locate here. Okay. And I really appreciate you outlining them for us, because my particular desire is that we repopulate the jobs that left when the Navy lowered the flag at the base. And this provides a new function to the building community out there. And I think the more we can build on that, the better. So I think we should move on this before yesterday. Yes, I because this is very important to us in Alameda. Thank you. Thank you. Thank you, Spencer. And I just want to disclose that back in September, I was invited to a meeting with Mr. Wright, and I was so excited for this project to come before the city council. Back then, you described your workers as a gang of. Geeks. And I think Alameda could use more geeks and especially in the number in growth that you're talking about. This company is doing a lot of great, innovative work. They have received a grant from the California California Energy Commission, I think recently, around $5.8 million. They're doing some work that we want to see more of done throughout our state and great for it to be happening here. And I'm so happy that you've chosen to leave the as you describe stories, your employees describe the soul sucking environment of San Jose down near the San Jose Airport. I think because what we can offer you at Alameda Point in what's in the works now is a very vibrant, exciting environment with not only other employment uses, but also restaurants and businesses that are coming that your employees will will want to frequent in. And we hope that many of them will also choose to live in Alameda and just eliminate their commute altogether. For most, most of them right now are renters. So. All right. Come on up. Anyway, I am I am also fully in support of this measure. MEMBER Doug. Thank you. I just want to briefly say Mr. Right, thank you very much for bringing jobs to Alameda and creating jobs here. Thank you very much for investing here. Appreciate it. You're very welcome. Thank you. Mayor Brody. I'm going to echo a lot of what my colleagues have said, but also thank you, Mr. Right, for choosing to do business here in Alameda. It's it's an exciting opportunity to have this at the base was 150 you said 350 new jobs I mean your adaptive reuse of that building investing almost $4 million in that building, I mean, that's exciting. And I also think, you know, the reduction in greenhouse gas emissions that that you were at business is going to actually achieve. For California, we have aggressive goals statewide. The governor wants to even be more aggressive about it and the opportunity for you to do that and the opportunity for you to incubate other businesses that can come around you. I think it's exciting for me to point and I'm glad you're here. Thank you. Thank you very much. And I concur with my fellow council members. Thank you. We have a motion. Yes. I would love to move approval of the ordinance authorizing the city manager to execute documents necessary to implement the terms of the lease with Right Speed Inc, a Delaware corporation for a lease of seven years with two five year options and an opportunity to purchase Building 41, located at 650 West Tower Avenue at Alameda Point. Second and Vice Mayor Seconding and all those in favor. Hi. Hi. Hi. Hi. Thank you very much. Passes. Thank you very much. All right. Next item is item six C. Adoption of resolution. If accepting a grant from the State of California, Department of Parks and Recreation, division of Boating and Waterways in the amount not to exceed 80,000 for the purchase of a patrol boat and patrol trailer. Appropriate up to 80,000 from the general fund for purchase of the boat and authorize the city manager, her or his designee to execute grant funding purchase agreement.