by Airport Industry-News
25 Jan 2021
Funding and Financial Support
SFO Launches Emergency Rent Relief Program for Airport Concession Tenants
Mayor London N. Breed has signed an ordinance authorizing the San Francisco International Airport (SFO) to launch a rent relief program for airport concession tenants, in which lease agreements will be modified to waive certain rent and fees. The value of the relief available to be granted under the COVID-19 Emergency Rent Relief Program is estimated at $21.3 million and will be supported through federal CARES Act funding.
SFO will join the San Francisco Port, San Francisco Municipal Transportation Agency, and the Recreation and Park Department in providing relief for commercial tenants impacted by COVID-19.
“We know how hard this pandemic has hit our retailers and businesses, especially at the airport where traffic has been down significantly for months. The City has worked to provide relief to our tenants where we can, including deferring and waiving fees and rent to the City. As we work our way towards recovery and travel picks up again, we are going to need these businesses to serve our visitors and residents.”
“Our entire SFO business community is critical to delivering the travel experience our passengers expect and deserve. We appreciate the perseverance of our concession tenants and hope this Emergency Rent Relief Program will help them to continue operating and begin the process of recovering and rehiring.”
SFO concession tenants pay the greater of a Minimum Annual Guarantee (MAG) or a percentage of Gross Receipts (Concession Fee) along with other cleaning and infrastructure fees. Each concession lease provides for a suspension of the MAG if passenger traffic declines severely for three consecutive months. Under this provision, MAGs were suspended effective June 1, 2020 and will resume after enplanements have recovered for a period of two months.
Under the COVID-19 Emergency Rent Relief Program, the MAG will be waived for the months of March, April and May 2020. In addition, all fees will be waived for April and May 2020, and all cleaning and infrastructure fees will be waived from June through December 2020. Rental car tenants, whose lease structure differs slightly, will have space rent waived for March, April and May 2020, and utilities fee waived for April and May 2020. Concessions must meet eligibility requirements, which include payroll and rehiring requirements, which prioritize the hiring and/or re-hiring of laid-off and furloughed employees at SFO.
This article was originally published by San Francisco International Airport.
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