Special Notice / Hearing: None__
Vote Required: Majority
To: Honorable Board of Supervisors
From: Michael P. Callagy, County Executive
Subject: Second Amendment to Office Lease with Health Plan of San Mateo for the County’s leasing of the second and third floors of the building at 801 Gateway Boulevard, South San Francisco (Lease No. 1322)
RECOMMENDATION:
title
Adopt a resolution authorizing:
A) The President of the Board of Supervisors to execute a Second Amendment (“Amendment”) to Office Lease (“Lease”) with Health Plan of San Mateo, for the County’s leasing of the 29,333 square feet of office space on the second floor and the 12,500 square feet of office space on the third floor, both in the building commonly known as 801 Gateway Boulevard, South San Francisco, and identified as Assessor’s Parcel Numbers 015-024-450 and 015-024-460, for the continued term through March 31, 2031, at a monthly Base Rent of $114,399 for the second floor space and $48,750 for the third floor space, with annual 3% increases; and
B) The County Executive, or their designee, to accept or execute any and all notices, options, consents, approvals and documents associated with the Amendment or the Lease including, but not limited to, extension or termination of the Lease under the terms set forth therein. (Lease No. 1322)
body
BACKGROUND:
Since April 1, 2016, the County has leased from Health Plan of San Mateo (“HPSM”) for the use of the County Health Department the 29,333 square feet of office space on the second floor (“2nd Floor”) of the building located at 801 Gateway Boulevard, in South San Francisco.
On April 6, 2021, as authorized by San Mateo County Resolution No. 078101, the term of the Lease was extended through March 31, 2026.
The County now wishes to amend the Lease to extend the term of the Lease and add additional space on the third floor.
DISCUSSION:
Real Property Services has negotiated a five-year extension of the Lease for a term through March 31, 2031, with the option for the County to terminate the Lease with at least 90 days’ notice before each April 1st renewal date, and the addition of 12,500 square feet of office space on the third floor (“3rd Floor”), commencing tentatively on June 1, 2026, after HPSM has completed the agreed-upon leasehold improvements. The monthly base rent shall be $3.90 per square foot, or $114,399 for the
2nd Floor, effective April 1, 2026, and $48,750 for the 3rd Floor, effective on the date that the County begins to occupy the 3rd Floor space, with annual 3% increases.
The County Attorney’s Office has reviewed and approved the Amendment and resolution as to form. The Chief of Health concurs in this recommendation.
COMMUNITY IMPACT:
The County of San Mateo is dedicated to ensuring equitable access to quality services for all residents. The County acquires and leases real property to ensure all residents can access services in the locations and facilities best suited to their specific purposes. This amendment will further the County’s ability to ensure that critical services for residents can continue to be met.
FISCAL IMPACT:
The total monthly base rent of $163,149 has been budgeted in the Fiscal Year 2026-27 Recommended Budget, which is covered by proportional contributions from County Health divisions, which may include some Net County Cost, depending on the composition of each division’s contribution.