Port of West Sacramento and SSA Pacific to Enter into New Lease Agreement of Port Terminal
May 23, 2013
The Sacramento-Yolo Port Commission
has approved a new master lease of its West Sacramento maritime facilities with SSA Pacific, Inc. (SSA).
The new lease, which takes effect July 1, 2013, replaces an existing Terminal Operations Management Agreement with SSA.
The new agreement provides guaranteed rent payments to the Port of West Sacramento and shifts all maritime-related operational expenses to SSA, enabling the Port 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," said Mike McGowan, chairman of the Port Commission, at the commission's May 15th meeting.
"As teminal operators, SSA has had a very good working relationship with the City of West Sacramento and the customers of the Port in the past," said Mark Knudsen, President of SSA Conventional. "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 t he area."
The lease will be for a minimum of five years and can be extended by 5-year increments to a miximum of 20 years. Minimum annual rent payments to the Port start at $650,000 and the lease provides for additional revenues to the Port as shipping tonnage increases. As 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.