ACTION MINUTES

Special Meeting of the Waterfront Commission

June 24, 1998

Hs Lordships Restaurant

199 Seawall Drive

1. CALL TO ORDER

Chair WASSON called the meeting to order at 7:30 PM. Secretary Marchetti called the roll:

COMMISSIONERS PRESENT: SMITH, THOMAS, Chair WASSON, Vice-Chair WOLGAST, & WOZNIAK.

COMMISSIONERS ABSENT: FELIX, JONES, KAWCZYNSKA, and WINDHAM.

STAFF PRESENT: Cliff Marchetti, Ed Murphy, and Bill Lambert.

2. PUBLIC COMMENT

None.

3. DISCUSSION ITEMS

a. Building at 225-235 University Avenue

Bill Lambert with the City Manager's Economic Development staff introduced Mr. Don Yost, a principal in the real estate firm of Norheim and Yost. Mr. Yost briefly explained that his role is to represent the City as a broker, to market the property at 225 University, and to help the City negotiate the best price to the City for the property. He also distributed and explained his marketing package. Don Yost said that he expected to get some positive responses within 3 - 4 months.

No action was taken.

b. Hs Lordship Restaurant

Ed Murphy introduced Mr. David Tallichet, the President of Specialty Restaurants Corp., which owns Hs Lordships Restaurant. Mr. Tallichet proceeded to explain his plan to renovate the building and to focus business more towards the banquet business as opposed to a restaurant facility. He said this was due to the physical layout and site orientation of the building. He also explained that his long term goal is to build another building on the northwest side of the property which would be a restaurant and would take advantage of the westerly views of San Francisco Bay, the City, and the Golden Gate. He said his first priority is to renovate the existing building, repair the parking lot, and to expand the existing building by adding an addition of 80' X 20' to the Windsor Room (facing north) and then to add a patio of 80' X 20' off the expanded room.

Mr. Tallichet introduced his architect and contractor who explained the plans, landscaping, and color schemes in more detail. The Commission asked questions and generally discussed the plans in detail, especially the plan to expand the Windsor room and the new patio. The addition would result in eliminating the landscaped berm in front of the building. Mr. tallichet said he would replace the "lost" trees on a 4 to 1 basis and put most of the new trees in the parking lot.

In describing the rationale for using the building as a banquet facility, Mr. Tallichet said that there is a strong demand for this type of use and that the size and orientation of the existing facility lent itself to meeting this demand. He said that a patio to the east side of the building hanging out over the water would attract a different kind of clientele which would support more restaurant business and would increase his gross receipts. The Commission was generally favorable to this idea, subject to further review.

The Commission did not take any action, but encouraged Mr. Tallichet to proceed with his plans and to work with City staff on the details. Mr. Tallichet and his associates left the meeting at 8:40 PM and the Commission then discussed the gross receipts information and the request by Mr. Tallichet to extend the length of the current lease, which expires in 2017. The Commission expressed concern over the low gross receipts and asked staff to obtain a business plan from the tenant which would include income projections for the remaining term of the lease and for any requested extensions. The Commission noted that the level of gross receipts is much more important than minimum rent and percentage rent. The Commission asked staff to continue to work with the tenant in its plans for a renovated facility and to work out the terms of an amended lease, if the benefits to the City warranted such an amendment. Staff indicated that the goal would be to make a complete report to the Commission on this issue at its regular meeting on August 12th.

8. ADJOURNMENT

Commissioner WOZNIAK made a motion to adjourn which was seconded by Commissioner SMITH. The motion was adopted by a vote of 5-0-0-4 at 9:10 PM.

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