Title
Adopt a Resolution to Approve and Authorize the City Manager to Execute a First Amendment of Lease by and Between the City of San Leandro and As Kneaded for the Food Service Space and One Specific Parking Space at the Main Library, Reducing Rent by $363.29 per Month, Adjusting for the Monday Library Closures in FY 2027 and Beyond
Staffreport
COUNCIL PRIORITY
• Quality of Life
• Economic Development
SUMMARY
The City entered into a Lease Agreement with As Kneaded to provide food service at the Main Library on October 1, 2025. As Kneaded made required improvements to the space and opened to the public on February 14, 2026. That agreement was based on the understanding that the Main Library would be open Monday - Saturday. Due to the need for budget reductions in FY 2027, the Library will not be open on Mondays for the foreseeable future. This amendment would adjust rent to be commensurate with the days of the week the Library is open. The rent was $2,550 per month. Going forward, as of July 7, 2026, rent would be $2,186.71 per month with the elimination of rent for 52 Mondays.
RECOMMENDATIONS
Staff recommend that the City Council authorize the City Manager to amend a lease agreement with As Kneaded for the food service space and one specific parking space at the Main Library, reducing monthly rent by $363.29. All other terms of the agreement would remain in place.
BACKGROUND
The City entered into a Lease Agreement with As Kneaded to provide food service at the Main Library on October 1, 2025.
With the need to close the Main Library on Mondays for the foreseeable future beginning July 7, 2027, the rental amount would be amended to be commensurate with the days of the week the Library is open. Amendment of the Lease Agreement would be reflected in Section 4. Rent. All other terms and conditions would remain in effect.
Analysis
The Main Library draws on average 646 visits each Monday. That’s on average 92 visits per hour open. As Kneaded, as a small business, went into the lease agreement with the understanding that foot traffic would be at that level. Due to the City’s budget circumstances, that foot traffic will be zero as the Library will close Mondays. The Library acts as the anchor “tenant” in the arrangement and closing Mondays deeply impacts As Kneaded’s ability to operate as planned. Therefore, it is prudent to adjust rent accordingly to demonstrate that the City is a good business partner.
In an effort to be a good business partner, the rent of $2,550 would be reduced to $2,186.71. Both parties agree to this amount.
Reduce Rent Calculation:
$2,550 X 12 months = $30,600/year.
$36,000 / 365 days = $83.84/day.
$83.84 X 52 Mondays = $4,359.45 as an annual reduction.
$4,359.45 / 12 months = $363.29 reduction per month.
$2,550 - $363.29 = $2,186.71 rent/month.
The Amendment would be effective July 7, 2026 and would apply to the July 2026 rent due and payable. The Lessee was granted a postponement of payment for July 2026 rent to July 11, if an amount is owed, and resuming in August 2026, rent would be due on the 1st of each and every month.
This action would amend Section 4. Rent of the current Lease Agreement as follows:
4. Rent. Rent shall be $2,186.71 per month paid on or before the 1st of each and every month of the Term and any extensions herein. Lessor will invoice the Lessee monthly. Prior to the following conditions being met, rent shall be $0 ("Abatement Period").
Legal Analysis
The City Attorney drafted and/or reviewed the applicable documents and agreements and approved them as to form. The Lessee has agreed to the terms of the lease amendment.
Financial Impacts
The FY 2027 General Fund projected revenue will be impacted by the amendment to the Lease Agreement. Once fully executed, this amended agreement will generate $2,186.71/month, or annually $26,240.55 in General Fund revenue. The reduced monthly income will result in a decrease of $4,359.48 over the original General Fund revenue projections.
ATTACHMENTS
Attachment A: Draft Resolution to Approve and Authorize the City Manager to Execute A First Amendment of Lease By and Between the City of San Leandro and As Kneaded for the Food Service Space and One Specific Parking Space at the Main Library, Reducing Rent to $2,186.71 per Month to Account for the Library Closures of Mondays for the Foreseeable Future; All Other Terms of the Lease will Remain Unchanged.
Attachment B: First Amendment of Lease of City Real Property at 300 Estudillo Avenue, San Leandro Between the City of San Leandro and As Kneaded Bakery
Attachment C: Original Lease of Real Property between the City of San Leandro and As Kneaded
PREPARED BY: Brian Simons, Library Director, Library Services Department