Tuesday, May 21, 2013

SSA Pacific Awarded New West Sacramento Master Lease

The Sacramento-Yolo Port Commission, which operates the Port of West Sacramento, has negotiated a new master lease of its West Sacramento maritime facilities with terminal operator SSA Pacific. The new lease, which takes effect July 1, 2013, replaces an existing terminal operations management contract between the two parties.

The new master lease shifts all maritime-related operational expenses to SSA. The port says this now enables it to reduce administrative costs and focus on development of its real estate assets.

“We’re redefining and redesigning the port and this is a critical first step,” Port Commission Chair Mike McGowan said during the commission’s May 15 meeting.

The lease is for a minimum of five years and can be extended by five-year increments to a maximum of 20 years. Minimum annual rent payments to the port start at $650,000, however the lease provides for additional revenues to the port as shipping tonnage increases.

Also part of the agreement, the port is relieved of $850,000 in existing debt to SSA, and SSA agrees to purchase the port’s existing air credits related to bulk cargo handling for $50,000.

“The new lease arrangements will allow SSA to further expand our role, attract new investment, and increase business through the port, which will be good for the City of West Sacramento and increase jobs in the area,” SSA President Mark Knudsen said in a statement.