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CITY OF SAN LEANDRO CITY COUNCIL BUSINESS DEVELOPMENT COMMITTEE October 12, 2006 4:00 p.m. - 5:30 p.m. San Leandro City Hall 835 East 14th Street San Leandro, California Sister Cities Gallery Room HIGHLIGHTS Committee Members: Mayor Young, Councilmember Badger, Councilmember Stephens (Chair) City staff present: John Jermanis, Steve Hollister, Hanson Horn, Tom Liao, Debbie Pollart, Luke Sims, Stephanie Stuart, Sally Barros, Ryan Evans and Tim Ricard Public present: Gary Mortara, Jim Lee, Joel Ware and Dan Gregg The meeting was called to order at 4:05 p.m. 1. Amendment to OPA with Amin Concord LLC for the Hilton Garden Inn at 524 Lewelling Blvd. Business Development Manager Luke Sims gave an overview of the proposed amendment to the Owner Participation Agreement between the Redevelopment Agency and Amin Concord, LLC, the developer ofthe Hilton Garden Inn, highlighting the business terms. The amendment has been under discussion over the past year to allow more flexibility in the OP A so that the developer can better compete for long-term contracts with airlines to accommodate flight crews operating out of Oakland International Airport. Tn an effort to maintain the quality of the hotel, two key requirements were placed on the developer in the original agreement: (I) that the property maintain an Auto Club three diamond rating; and (2) that the operator of the hotel be prohibited from offering long-term contract accommodations. This was in response to the situation at The Islander Motel where a portion of the motel converted into what was essentially an apartment building. Sims explained that the experience with the Hilton Garden Inn is not comparable and the because of the restrictions on long-tenn contracts the hotel was unable to compete with the other hotels in the airport market for airline contracts. The proposed amendment will allow long-term contracts as long as the property maintains the three-diamond rating. A summary of the background and proposed amendment is attached, (Attachment No.1). Mayor Young asked whether there is a downside to the amendment. Sims replied that the airline contracts actually require services beyond the standards of the Automobile Club, such as having three hot meals per day and the result during a recent pilot period had been very successful. In response to a question from Councilmember Stephens, he noted that the long- term contracts are exempt from paying the transient occupancy tax but that arguably the