[Annotation] lw4
[Annotation] lw4
[Annotation] lw4
REAL ESTATE DIVISION 2015 BUSINESS PLAN 
June 17, 2014 
MISSION: 
To manage Port owned real estate in a manner that earns a positive return on the public's investment; 
To be a catalyst for private investment by developing Port owned real estate in ways that will spur
development by others; and 
To utilize existing and future assets in ways that will benefit operations and expansion of the existing
Port business enterprises. 
VISION: 
To financially break even, division wide, by 2020 
MAJOR AND NEW INITATIVES: 
Implement projects from Fishermen's Terminal 25 Year Plan 
Implement projects from 2014 Site Plan update at Shilshole Bay Marina 
Increase utilization of Terminal 91 uplands acreage 
Des Moines Creek Business Park build out 
Ongoing  Evaluation of properties/facilities and recommend long-term strategies 
Implement Key Capital and Expense Projects: 
Design of Shilshole Bay Marina Customer Service Buildings (restroom, showers, laundry,
storage) 
Design of paving improvements at Shilshole Bay Marina 
Design Shilshole Bay Marina Fuel Float Building (1962) 
Design Bell Harbor Marina Pile Wraps & Wavebreak Panels 
Complete Pier 69 Beam Rehabilitation 
STRATEGIES - SUMMARY: 
Manage our finances responsibly - Increase the Real Estate Division's Net Operating Income by: 
Maintaining occupancy levels and rental rates at or favorable to the broader market 
Increasing property utilization by offering and executing long term ground leases for land
redevelopment 
Acquiring or disposing of assets as circumstances warrant 
Implement Century Agenda Strategies  Use our influence as an institution to promote small
business growth and workforce development: 
Foster new business opportunities for local businesses 
Increase work force training for local communities in trade, travel and logistics 
Consider incubator development/land uses 
Implement Century Agenda Strategies  Be the greenest, and most energy efficient port in North
America: 
Integrate business friendly environmental objectives into our organization 
Conduct business activities in environmentally appropriate ways 
Consistently live by our values through our actions and priorities: 
Align leadership, people and systems with strategic priorities and plans 
Strengthen a high integrity, continuous improvement culture 
Increase organizational and individual ownership for safe and secure work practices and
healthy living 
Page 1

Exceed Customer Expectations in Maintaining Assets including: 
Preventing recurrence of deferred maintenance backlog 
Being aggressively defensive in asset management through 2016 to minimize economic
damage related to the reconstruction of the seawall and the construction of the Alaskan Way
tunnel and viaduct demolition 
DIVISION DESCRIPTION: 
The Real Estate Division integrates the efforts of five functional workgroups: Harbor Services, Portfolio &
Asset Management, Real Estate Development & Planning, Marine Maintenance, and Pier 69 Facilities
Management. Financial services, project management, and environmental services are acquired from the
Seaport Division. 
Following are the five business and service groups and their functions:
Harbor Services: Operates, leases and markets five marinas offering moorage/storage/yards and a variety of
other products and services. Its two commercial fishing moorage facilities, home to the North Pacific Fishing
Fleet, provide space for more than 600 commercial fishing vessels, commercial work vessels as well as
recreational vessels. Its three recreational marinas provide facilities for more than 1,600 recreational, 
commercial fishing and commercial pleasure vessels and 13,000+ guest boaters.
Portfolio& Asset Management: Leases, markets, and manages the Division's portfolio of conference, office,
retail, commercial, and industrial properties and works to enhance the value of the Division's assets through
strategic asset planning and repositioning. This business unit will also lead the asset management efforts
related to the Eastside Rail Corridor. 
Real Estate Development & Planning: Plans and facilitates the development of selected real estate assets
currently within its own portfolio and provides development expertise and support to the Seaport and Aviation
Divisions. The team also identifies and evaluates new opportunities outside the Port's current portfolio and
completes other transactions related to Port assets. 
Marine Maintenance: Provides comprehensive maintenance, repair and small capital services to properties
and equipment in the Real Estate and Seaport Divisions. Marine Maintenance also has the obligations to
maintain the 23 park and public access properties owned by the Port of Seattle. 
Pier 69 Facilities Management: Ensures functionality of Port Headquarters by integrating people,
place, process, and technology. Operations include reception, motor pool, mailroom, shipping &
receiving, conference center, and Clipper Caf. 
INDUSTRY ASSESSMENT: 
The local real estate market is continuing to recover from the 'Great Recession' on literally all fronts. That
makes for encouraging news for the broader market in a macro sense although specific submarket pressures
will still adversely affect the Port of Seattle Real Estate Division holdings. This discussion will be divided into
several component parts, each of which has a bearing on real estate strategies for the near future. More specific
detail on many issues will appear in the individual business unit business plans; this is intended to provide an
executive summary of the most critical influencers on our real estate for the next few years. 
Development Cycle: 
As we have discussed in the past, the development cycle/window has a bearing on real estate strategies going
forward. As is typical with the expansion phase of the cycle, we see vacancy declining; new construction
starts and deliveries on the horizon; rent growth is rising while the supply is constrained; cap rates are
declining as a result of multiple investors pursuing the few offerings in the market.
The critical question relative to the Port's real estate is when to put it in play and not deploy it when the cycle
shifts from expansion to contraction. Over-building or providing more capacity than the demand warrants
triggers the contraction; vacancy rises; new construction abates, rents stabilize or decline if more new product
Page 2

is delivered than the demand warrants; cap rates become volatile but higher as investors scramble to place
capital and drive prices as low as the market will tolerate. We are still in the expansion phase; predicting when
that will change is the magic of the real estate development world. 
Regulatory/land use/ zoning: 
Much of the real estate managed by the Real Estate Division is subject to the Shorelines Master Plan; it is
currently being refreshed as required by state statute. As currently drafted, however (and pending review by
the City Council and the Department of Ecology), additional setbacks from the water will further constrain the
utility of some sites. 
The continuing debate about the stadium district and the relocation/expansion of an NBA team will have an as
yet unknown effect on real estate in SODO as the city contemplates new uses in the near south downtown
neighborhoods. 
The pending amendment to the comprehensive plan in the Interbay neighborhood will have an as yet
undetermined effect on Port real estate in the north end of the harbor. The current proposal to upzone to
Industrial Commercial from IG2 would raise the height limit to 65' from 45' and provide for unlimited office
space compared to 10,000 square feet of accessory office in current zoning. Industrial sites with more dense
entitlements will likely trade at higher prices as a result of greater utility; despite these higher sale prices,
inventory is being reduced from the supply altogether. Feasibility analysis in the future for industrial uses
will be more difficult if their business model cannot accommodate the higher ground rents/values. 
Capital Markets: 
During the recession almost all real estate developments dissolved into short term memory; underwriting and
appraisal standards tightened and owners and developers found themselves in the unfortunate position of being
unable to re-finance or to avoid capital calls as existing debt packages matured; foreclosures and deeds in lieu
of foreclosure became the product of workouts of bad loans.
Other than the few self-financed developments/build to suits, little development was occurring. That dynamic
has now shifted rather remarkably. 
Capital is available for development, most notably in the local market for residential development, although
some commercial and industrial deliveries are now in the pipeline. Vacancy rates for commercial now hover
at 12% and industrial near 6%; this spurs development on both fronts. The net result of this increased appetite
is a reduction of the number of building sites and an increase in the number of re-development sites. While the
Port does not use conventional financing for our real estate projects, the demand for capital nonetheless drives
the cost of capital upwards and clearly for those properties which would be developed by third party
developers, the conventional financing constraints will apply. 
Capital requirements: 
Given the age of most of the industrial properties owned by the Port, the capital requirements are significant.
As presented to the commission in prior briefings, the capital requirements through 2022 are presently
estimated at $101 million; the majority ($85.2) million at Fishermen's Terminal and the Maritime Industrial
Center based on staff's review of the coming needs. It is critical to note that none of the projects has been
engineered or priced based on our protocol relative to capital projects; when those projects percolate to the
surface further clarity to the capital required will become apparent. 
Debt Service: 
As of 12/31/2014, the real estate division will have an outstanding balance of revenue bond indebtedness of
$47.7 million, largely related to the re-development of Shilshole Bay Marina which was completed in 2008
and to the Pier 69 Facility. In 2016 through 2019, those bonds have significant debt service payments due;
debt repayment or re-financing looms. 


Page 3

Deliveries/Projects in the Pipeline: 
Projects in the pipeline, along with 2013 deliveries are heavily skewed toward residential development as
mentioned above. 2013 saw 26 projects delivered in Seattle; 17 of those were residential projects. 2014
shows 45 projects under development of which 31 are residential. This continuing demand for residential will
absorb some of the capital capacity in the market but not likely for other property typesdevelopers and
lenders alike evolve preferences for certain classes of opportunity so the market is somewhat segregated.
Industrial deliveries in the pipeline at present are 17 projects with active permits, all either in SODO or
Interbay. 
Infrastructure Projects: 
Greater detail of the challenges by the public infrastructure projects along the waterfront will appear in the
Portfolio and Asset Management business plan; however, the overlap of the seawall construction, the removal
of the Alaskan Way viaduct, the uncertainty of the re-development of the Colman Dock, the construction of
the proposed waterfront park and public spaces all have a detrimental effect on the leasing of the bulk of the
commercial space owned by the Port since it is centrally located in the center of all these public construction
projects. We anticipate that, while the broader market improves, our ability to lease will rely on greater capital
investments in the form of tenant improvement allowances. 














Page 4

BUSINESS ASSESSMENT: 
HARBOR SERVICES 
Recreational Boating: 
The Port of Seattle's Recreational Boating business has done very well over the past two years. Demand and
occupancy levels remain strong in monthly moorage at all facilities, achieving 95%+ occupancy at Shilshole
Bay Marina and Harbor Island Marina. Bell Harbor Marina's off-peak seasonal monthly moorage remains
strong. 
Shilshole, which has the majority of monthly moorage, attributes its continued high level of success to the
marina's location, state of the art docks designed with good maneuverability and wide navigation channels, a
strong and active liveaboard community, and the customer experience focused service the staff provides. To
off-set increasing costs and keep margins at current levels, it is apparent that we need to continue to look
at implementing new revenue streams. Customer needs have led to new business ideas which require more
study such as gear storage rental, off-season RV use, additional non-port events, expanding the liveaboard cap
and adding food trucks. There are plans in place to address these as well as exploring the following: paid
parking, other public transportation options since Metro bus service is no longer available on Seaview Ave.;
providing Wi-Fi service to our customers which is now a common amenity in the industry; and soliciting
development opportunities for an on-site restaurant (ground lease) to attract guest moorage customers and the
public. The marina will be facing a number of major improvements over the next five years such as:
replacement of 1960's restroom/shower/laundry buildings that are at the end of their usable life and do not
meet the needs of many of our customers; repairs to utilities; repairs to the mile long parking lot/pavement;
replacement of the fuel dock building (built in 1962); and rehab to two docks that were not addressed in the
2006-2008 Dock Replacement Project. 
Bell Harbor Marina relies on short-term guest moorage revenues and remains the only marina with easy access
to the downtown corridor primarily.  In the off season, a portion of guest moorage is changed over to monthly
moorage in order to increase revenues. Due to the down economy and high fuel prices, guest moorage demand
has dipped for Bell Harbor for the past two years. However, as the local economy is showing signs of
recovery, there is an optimistic belief that Bell Harbor has the highest potential for future growth in terms of
occupancy and revenue. New floatation has recently been added to the docks that will help extend the life of
this asset. In addition, the marina office has been remodeled to help better meet the needs of our
customers. BHM is facing a significant capital improvement in the next several years to extend the life of the
under pier pilings and wavebreak that protect the marina. BHM will eventually be affected by the waterfront
construction which could have an impact on its revenues in the future. 
Harbor Island Marina is an aging facility. Plans are in place in 2014 to repair one of the docks (Commercial
Dock E) that is in the worse condition. Future dock repair projects are planned to follow every two
years. Harbor Island Marina has a lower price point that is attractive to many cost-conscious boaters. This has
led to the marina realizing its highest occupancy for the past two years. We expect this trend to continue at
least for another two years as we continue to make repairs. A challenge for marina pricing is its proximity to
two concrete plants which produce dust on marina vessels. 
Fishing and Commercial:
Commercial fishing vessel moorage demand remains steady with annual occupancy over 80%, even with the
majority of our customers leaving to work in Alaska for various parts of the year. Small commercial fishing
boats (<80') is the market that is most at risk due to the expense of operating a boat, owners retiring and boats
relocating. We are able to compensate for this loss of business to some degree by providing monthly moorage
for smaller recreational vessels which do not require year round moorage. 
Daily moorage demand for use of the loading docks on the West Wall and the Northwest Dock continue to
exceed supply at certain times of the year. Because many of our customers work in the same fisheries, they all
have the same deadlines and plans and accommodating all of them during key times of the year is challenging.
Demand for gear storage, both inside and outside, continues to be strong with demand exceeding supply.
Currently there are no ground floor storage lockers (net sheds) available and all outside fenced storage gear
Page 5

does not fit into the fenced storage areas resulting in net pallets loaded with gear being placed throughout the
terminal. 
Dock and moorage assets at Fishermen's Terminal are all fairly new with the oldest dock now approaching
thirty years old (Northwest Dock). Available shore power systems for the various sizes of boats continues to
set us apart from our competition. Over the next ten years, the capital plan for the entire Fishermen's Terminal
property calls for approximately $90M in projects such as the NW Dock improvements, Docks 3 & 4 rehab,
corrosion protection to seawalls, Net Shed buildings roof replacements, and the Maritime Industrial Center
west and central pier resurfacing. These projects are subject to the overall Port of Seattle capital plan funding
priorities.
The financial outlook for the terminal is projected to continue to be stable. The opportunity for increasing our
revenues will come from increasing the number of recreational vessels, as the recapitalization of the distant
water large vessel fishing fleet will, for the most part, replace old vessels with new ones, not necessarily
adding vessels to their respective fleets. However, the recapitalization of the commercial fleet represents a
stable and well managed industry. Moorage rates at the terminal for fishing and commercial vessels are
comparable to the Puget Sound public ports market average. Recreational vessel rates are at market as
compared to local marinas. Possible upland redevelopment, as proposed in the "Fishermen's Terminal 25 
Year Plan", is designed to increase revenue opportunities by developing additional retail and office to help
support Fishermen's Terminal financial goal to break even. The final redevelopment plan is contingent on the
Port of Seattle Commission direction.
PORTFOLIO & ASSET MANAGEMENT 
Leasing and Marketing:
The occupancy level of our Commercial Properties is currently at 90% compared to a broader Seattle market
occupancy of 88%. We expect leasing activity to increase with improving economic conditions but will
continue to wrestle with local challenges (e.g. transportation infrastructure projects) on the Central Waterfront
and Duwamish. Corresponding increases in leasing activity are expected in most other submarkets. 
Operations and Maintenance: 
The commercial real estate industry's focus on energy efficiency has resulted in a downward trend in total
operating expenses with approximately two-thirds of the savings achieved in the utility category, underscoring
an industry focus on maximizing building efficiency.
A large portion of the operations and maintenance services related to the portfolio are provided through the
Real Estate Division's Marine Maintenance Department. Our teams will continue to work together to improve
operating efficiencies, reduce environmental impact, to budget appropriately, and to manage our expenses in
order to maintain and improve the value of our portfolio of real estate assets. 
Capital Investments/Improvements:
By the end of 2015, the Portfolio and Asset Management team is expected to have been involved in the
oversight of over $9.940M in capital investments being made in the commercial properties. Investments will
be reflected in sustained existing revenues and improved operating efficiencies intended to position the
properties for improving market conditions and opportunity for additional revenue.
REAL ESTATE DEVELOPMENT & PLANNING 
The group's strength lies in the relatively well-located portfolio of underutilized sites in Seattle and
surrounding the airport. This is particularly significant given the increasingly smaller supply of close-in, wellserved
industrial land available for development. The portfolio provides the group and the division with the
best opportunity to improve financial performance by increasing revenue over both the short- and long-term.
Disposition of the portfolio, however, will require a careful balancing of both financial and non-financial
objectivessome of which can only be realized over a longer horizonagainst potential short-term financial
gains. This is a dilemma faced by most landowners. Better managing this circumstance is an opportunity for
improvement, particularly given the favorable market conditions and the opportunities afforded by the
upswing in the real estate market. 

Page 6

MARINE MAINTENANCE 
Marine Maintenance has an assignment that is different from other local government entities. It is also
different from that of Aviation Maintenance. The ages and types of properties are unique. 
In a recent study by TokuSaku Consulting, data was collected and comparisons made against established
benchmarks in clearly identifiable areas of maintenance. 
Marine Maintenance compared favorably with a broad range of private and public maintenance organizations
in cost of maintenance per rentable square foot. 
Locally, in a cost per catch basin comparison to the University of Washington, Marine Maintenance performed
at only two thirds the cost at UW. Similar results were noted in the comparison of fleet maintenance costs
between Marine Maintenance and UW. (Full study to be submitted to Commission.) 
CHALLENGES AND OPPORTUNITIES: 
HARBOR SERVICES 
Recreational Boating Challenges 
Keeping facilities available, customers satisfied and revenues coming in, during upcoming capital
improvement projects including Seattle waterfront construction projects. 
Maintaining assets responsibly while continuing to generate enough revenue to realize a profit. 
Designing and rebuilding the Shilshole multi-use service buildings (restrooms/showers/laundry) in a
way that will meet the needs of our customers and at a reasonable cost. 
Accommodating the needs of mega yachts, a growing business in Puget Sound albeit slow growing,
e.g. power requirements, dock structure, and amenities for crew. Other ports are considering
expanding assets to capture growing mega-yacht business in the region 
Implementing the requirements of new legislation such as the 2014 Derelict Vessel Bill. 
Recreational Boating Opportunities 
Adding value to Shilshole Bay Marina and new revenues where possible through projects and grants
such as: Seaview Boatyard expansion, customer service buildings (restrooms/showers/laundry),
restaurant pad (ground lease), outdoor fitness trail, guest moorage kiosk, storage for boating
equipment, and bringing in more boatshows and 3rd party events. 
Leveraging partnerships to create opportunities with CorinthianYacht Club, The Adventuress, Seattle
Yacht Club, Northwest Marine Trade Association, to name a few. 
Working with commercial customers to enhance SBM amenities. 
Utilizing new technologies to create efficiencies. 
Fishing and Commercial Challenges: 
Potential for further slow decline of the small boat fishing fleet (<80'). 
The price of fuel to vessel operators traveling to and from Alaska, likely at a new normal level. 
Poor weather conditions in June, July and August discouraging small recreational boat owners from
taking moorage. 
Capturing the new business from the revitalization of the fleet. 
Fishing and Commercial Opportunities: 
Retain business from commercial fishing customers who are recapitalizing their fleets. 
Continue to grow the recreational vessel fleet. 
Page 7

Use visibility of the fishing and maritime industry economic impact results to promote legislation that
would incentivise continued growth within the industry. 
PORTFOLIO & ASSET MANAGEMENT 
Commercial Properties Opportunities - Improving Revenue: 
The current real estate market appears to be trending toward continuing recovery which suggests more
opportunities for improving future revenue. 
Commercial Properties Challenges - Improving Revenue: 
Having experienced high vacancy rates over an extended period, landlords of commercial real estate
will continue to aggressively pursue tenants looking for commercial space. Well-positioned and
maintained properties that offer attractive amenity packages more readily benefit from improving
market conditions. 
Compliance with legal, financial and regulatory aspects of public entity ownership of real property can
result in having a less competitive edge than the private sector in the commercial real estate market
(contracting procedures, security deposit requirements, and limited flexibility in negotiations). This is
likely to be reflected in achievable lease rates at the lower end of the market range and/or lengthier
vacancies through missed opportunities.
Locations of several properties within the portfolio provide only limited amenities such as public
transportation, shopping, dining, walking trails, etc.
Updating and refurbishing aging infrastructure will require forward planning and capital investment. 
Commercial Properties Opportunity  Improving Operating Efficiencies: 
Trends in lowering total operating expenses through maximizing building efficiency supports
investments made in energy conservation initiatives. 
Commercial Properties Challenges  Improving Operating Efficiencies: 
Improving operating efficiencies in properties with aging infrastructure and implementing energy
conservation improvements will involve forward planning and capital investment. 
Increasing regulatory requirements increase maintenance costs. 
Commercial Properties Opportunity  Seattle Waterfront Improvements: 
The rebuilding of the Seattle Waterfront over the next few years presents a distinct opportunity to
leverage historical success and iconic heritage to update and refresh the Bell Street International
Conference and Event Center, the Maritime Event Center, the World Trade Center West and World
Trade Center Seattle in anticipation of renewed regional and international interest. 
Portfolio & Asset Management Challenges  Seattle Waterfront Improvements: 
There continues to be concern with local businesses that will be affected by the Alaskan Way Seawall Project.
Perception in the market is that the disruption from the ongoing work currently underway on the waterfront
will continue to negatively affect businesses along the entire waterfront for the next several years with the
following potential impacts:
Loss of traffic capacity and parking, commute time congestion
Walking access is constrained, impacting tourist activity 
Customer, public, employee and supplier access to businesses are restricted and congested 
Negative impact to seasonal business volume from both the physical and perceptual blockages 
Negative impact of construction activity (i.e., noise, congestion, muck) 
Loss of key infrastructure on the waterfront that serve the public and customer needs 
Businesses along Piers 54-57 will be closed October, 2014 through June, 2015 
Potential tenant's employee access to waterfront office space may be impeded 
Limited shopping, activities, and dining choices for employees of potential office tenants 
Public and potential tenants may likely avoid the waterfront altogether 
Page 8

Conference & Event Center Challenges  Improving Revenue Opportunities: 
Trend toward "just-in-time" event planning and the shortening of lead time for events creates
challenges in forecasting and logistics. 
Updating and refurbishing aging infrastructure will require forward planning and capital investment. 
Competitive marketalthough no new facilities are planned for 2015, a number of event space venues
have recently opened or have been remodeled to be more attractive (the Red Lion on 5th Avenue, the
Chihuly Garden and Glass, the Conference Center at the Washington State Convention Center, and
MOHAI).
Cruise activity and departure times often conflict with opportunities for planned events and has had a
negative impact on event opportunities. 
Parking capacity is very low given capacity and demand, particularly at the Smith Cove Conference
and Event Center. 
Transportation options are limited.
REAL ESTATE DEVELOPMENT & PLANNING 
Opportunity: relatively large portfolio of underutilized land, some of which can be positioned for
disposition with minimal investment. 
Opportunity: current market conditions appear to be fairly favorable given the ongoing rebound of the
real estate market. 
Challenge: market conditions are constantly in flux and ultimately drive the value that can be obtained
for any particular site. 
Challenge: some of the sites in the portfolio has encumbrancesboth physical and regulatorythat
constrain development. 
MARINE MAINTENANCE 
Challenge: Changes in maintenance demands from Seaport and Real Estate may require reconfiguration
of Marine Maintenance service delivery 
Challenge: Increasing regulatory compliance requirements increase maintenance costs for business units 
Challenge: Examine relocation of permanent Marine Maintenance shop which could offer opportunities
to review delivery service model and cultivate new efficiences, while creating interesting options for real
estate related to current shop properties 







Page 9

REAL ESTATE DIVISION STRATEGIES AND OBJECTIVES 
STRATEGY: MANAGE OUR FINANCES RESPONSIBLY - INCREASE REAL ESTATE
DIVISION'S NET OPERATING INCOME 
Objective: Meet 2015 Financial Targets 
Performance Measure   Performance Target      Actions 
Real Estate Division     Net Operating Income of    Continually monitor potential risks to Net
2015 Net Operating     ($TBD) million at        Operating Income 
Income (NOI)         12/31/2015 
Develop plans to mitigate or offset potential
Real Estate           losses resulting from these risks 
Development &
Planning NOI ($TBD) 
Harbor Services NOI
($TBD) 
Portfolio & Asset
Management NOI
($TBD) 
Eastside Rail NOI
($TBD) 
Environmental
Remediation Liability
($TBD) 
Objective: Achieve Target Occupancy while Maintaining Market Rates 
Occupancy of        Year-end occupancy rate    Develop and maintain an ongoing leasing and
Commercial Buildings at  will be 90% or better       marketing strategy for each asset that responds
year-end 2015                             to current commercial real estate market
condition that include recommendations for: 
Marketing 
Asking rates based on market conditions 
Concessions (i.e. improvement allowances
and rent abatements 
Level of maintenance 
Capital improvements 
Utilization of outside broke 

Achieve average moorage  Recreational Marinas 94%   All staff continue to provide an extraordinary
occupancy target for year   Fishing & Commercial     customer service experience (GEM-Going the
facilities 79%             Extra Mile) through welcoming attitude, clean
facilities and docks, continuance of the GEM
program and events 
Operations and Marketing staff together review
monthly the occupancy, demand and trends.
Adjustments to action plans as needed 


Page 10

Objective: Generate New Revenue By Increasing Property Utilization 
Advance Fishermen's    Finalize recommendations   Portfolio & Asset Management will continue to
Terminal 25 Year       of 25 Year Plan for Port    lead the 25 year planning process with the
Redevelopment Plan in   Commission review and    support of the Harbor Services Group focusing
conjunction with Century  approval               on gaining the Port of Seattle Commission
Agenda                              approval 
Advance site plan update  Implement             Portfolio & Asset Management will support and
at Shilshole Bay Marina   recommendations from site   collaborate with the Harbor Services Group in
plan updated in 2014       implementing 2014 updated Shilshole Bay
Marina site plan recommendations for both
landside and marina improvements/assets 
Terminal 91 Uplands    Increase revenue and      Identify and execute additional short-term leases 
revenue              utilization of the vacant     Complete negotiation a long-term ground lease
acreage                of the site or an alternative disposition strategy
for the vacant acreage 
Assumes developer RFP is issued in 2014 
Des Moines Creek      Owner's rep monthly      Monitor construction of first improvements for
Business Park (DMCBP)  reports indicating        consistency with the approved plans and
build-out              construction consistent with  specifications 
approved plans and
specifications 
Second phase entitlements   Coordinate permitting and plan review work
underway             with developer for the second phase
improvements 
Redevelopment planning  Consultant selected and    Finalize consultant selection and contract 
advanced on Burien     contract finalized 
Northeast Redevelopment
Area (NERA)         Monitor completion of     Manage the planning and design of the proposed
consultant's scope on a     infrastructure improvements as part of the FAA
monthly basis.            pilot program. 
Assumes FAA pilot program application is
submitted and approved by the FAA in 2014 
Approve or disapprove     Review potential transactions from the listing
potential deals; secure      broker; pursue transaction as warranted 
commission approval as      Assumes listing broker is retained in 2014
needed 
Objective: Acquire or Dispose of Assets as Circumstances Warrant 
Various acquisitions,     Complete transactions if     Transfer right-of-way needed by the City of
sales, leases and         feasible                 SeaTac for the extension of 24th Avenue S. that
easements analyzed and                      includes the former mobile home park property 
completed 
Monitor Sound Transit's compliance with the
temporary construction easements associated
with the Link light rail extension to South 200th 
Street 
Acquire or dispose of     Analyze individual       Consistently review assets and implement long
assets as circumstances    properties/facilities in the  term asset management strategies 
Page 11

warrant              portfolio and recommend
long-term strategies 
STRATEGY: IMPLEMENT CENTURY AGENDA STRATEGIES - USE OUR INFLUENCE AS AN
INSTITUTION TO PROMOTE SMALL BUSINESS GROWTH AND WORKFORCE
DEVELOPMENT 
Objective: Foster New Business Opportunities for Local Businesses 
Performance Measure   Performance Target      Actions 
Utilize small businesses    15% of operating and       When feasible, utilize qualified small businesses 
capital expenditures        Track purchasing and contracting activities 
Objective: Increase Work Force Training for Local Communities in Trade, Travel and Logistics 
Utilize apprentices and    Five apprentices and twelve  Continue outreach to schools and support
interns in Marine        interns per year           organizations 
Maintenance 
Work with Aviation to share programs such as
Career Workplace Exploration in Skilled Trades
(CWEST) 

STRATEGY: IMPLEMENT CENTURY AGENDA STRATEGIES  BE THE GREENEST AND
MOST ENERGY EFFICIENT PORT IN NORTH AMERCA 
Objective: Integrate Business Friendly Environmental Objectives into our Organization 
Performance Measure   Performance Target      Actions 
Support Port          Visit at least four properties  Real Estate managers and member(s) of
Environmental        per quarter            environmental staff will inspect selected
Department's Tenant                       properties to ensure tenant compliance with
Compliance Program                       lease environmental requirements 
Implement an energy    Complete by Q4 2015      Shilshole Bay Marina: Pending review of the
efficiency improvement                      2014 energy efficiency evaluation, complete
to outdoor yard and dock                      construction of the outdoor yard and dock
lighting at Shilshole Bay                        lighting at the property (rebate by Seattle City
Marina and Fishermen's                     Light) 
Terminal 
Fishermen's Terminal: Complete an energy
efficiency audit and a cost benefit analysis of
outdoor yard and dock lighting improvements 
Maintain or reduce      Electrical consumption is    Monitor and maintain building systems to
electrical consumption at  within 5% of 2014 (Port of   ensure that system components operate as
P69 Headquarters       Seattle occupied space)     designed 
ENERGY STAR score is   Continue to explore opportunities to reduce
within 2 points of 2014     electrical consumption 
score (entire P69 site) 
Purchase of lower       100% of vehicles purchased  Use Fleet Replacement Program to find
emission type vehicles     are lower emission types     opportunities and control purchases 
Objective: Conduct Business Activities in Environmentally Appropriate Ways 
Maintain Clean Marina   Certification maintained    Fishermen's Terminal: Maintain regulatory
Washington/EnviroStar   and/or achieved by Q4      requirements to achieve EnviroStar
Page 12

certifications at                                 recertification by year-end 
Fishermen's Terminal
Recreational marinas: Maintain standards to
and recreational marinas 
satisfy regulatory certification requirements
(certified every three years; 2013 was last
certification) 
Maintain EnviroStar and  Certification is renewed at   Ensure EnviroStar compliance 
Salmon Safe         all facilities by Q4 
Ensure Salmon Safe compliance 
certifications at Marine
Maintenance facilities 
Environmental regulatory  Zero regulatory violations    Continually educate customers about Best
compliance                              Management Practices (BMP's) and agency
regulations including enforcement 
Train 100% of available Marine Maintenance
staff and craftspeople in annual safety training
day and communicate regulatory changes in
monthly safety meetings 
STRATEGY: CONSISTENTLY LIVE BY OUR VALUES THROUGH OUR ACTIONS AND
PRIORITIES 
Objective: Align Leadership, People and Systems with Strategic Priorities and Plans 
Performance Measure   Performance Target      Actions 
PREP Plans include clear   100% PREP Plans include   Managers meet with employees to ensure
accountabilities,         clear accountabilities and    understanding of accountabilities, measures and
measures, and linkages to  measures, and linkages to    linkages 
goals                goals 
PREP reviews are      100% of PREP plans are    Employees and managers complete PREPS on
completed on time       completed on time         time 
Objective: Strengthen a High Integrity, Continuous Improvement Culture 
Identify and implement   Identify two new tools to    Projects to be determined (see business and
work process         improve effectiveness      service group business plans) 
improvements         and/or efficiency 
Implement either       Implement by end of Q4    Working with Information & Communications
enhancements to the     2015                 Technology, implement and complete the work
Marina Management                     plan including training of 100% of staff 
System or a 3rd party
marina management
system 
% Participation in       100% of staff            Staff members will attend or participate in one
diversity activities                               diversity activity per year 
% Personal development  100% of staff           Each employee will include a personal
plan in PREP                             development plan in PREP 
Objective: Increase Organizational and Individual Ownership for Safe and Secure Work Practices
and Healthy Living 
Fishermen's Terminal   Complete the planned     Continue extensive communications and
Net Shed Buildings    improvements by year-      coordinate with PCS and FT customers to
complete interior net locker improvements 
Page 13

Code Compliance     end 2015              on schedule 
improvements are                       Coordinate with Maintenance and customers
completed                              any other planned improvements to the
interior of lockers so as to disrupt fishing
customers the least & gain cost efficiencies 
Harbor Services attains    100% on year-end 2015     100% of employees complete all requirements
perfect score on the      Health and Safety Plan audit  and training as specified in the facility safety
Health and Safety Plan    (published in Q1)         plans 
audit 
Maintain and update P69  Complete plan update      Ad hoc updates (contact information, etc.) are
Facilities' Continuity of   before end of Q3 2015       done throughout the year. Plan review/update is
Operations Plan (COOP)                    completed before end of Q3 
document 
STRATEGY: EXCEED CUSTOMER EXPECTATIONS IN MAINTAINING ASSETS 
Objective: Maintain Assets 
Performance Measure   Performance Target      Actions 
Implement key projects:   Harbor Services: 
Complete design of     Gain Commission funding approval for all
SBM customer service   projects. Work with Project Management to
center buildings        assist with completion of improvements per plan 
(restroom, showers,
laundry, storage) by Q4   Complete Customer and Community
Complete SBM Fuel    Communications and Coordination Plan 
Float building
replacement by Q4 
Complete design of Bell
Harbor Marina Pile
Wraps & Wavebreak
panels by Q4 
Pier 69 Facilities: 
P69 Beam Rehabilitation  Provide influential and decisive leadership for
complete by Q4 2015    Marine Maintenance, Seaport Project
P69 HVAC System    Management, and Engineering to ensure that
Major Component     projects are correctly defined, scoped, and
Strategy  Work with    delivered on time and within budget. 
Engineering to compare
replacement vs. renewal
strategies, rough order of
magnitude budget and
schedule 



Page 14

STRATEGY: BE AGGRESSIVELY DEFENSIVE IN ASSET MANAGEMENT THROUGH 2016 TO 
MINIMIZE ECONOMIC DAMAGE RELATED TO THE RECONSTRUCTION OF THE SEAWALL
AND THE CONSTRUCTION OF THE ALASKAN WAY VIADUCT TUNNEL 
Objective: Maintain Assets 
Performance Measure   Performance Target      Actions 
Occupancy at properties   Optimize occupancy       Consider shorter term, aggressive rent proposals
impacted by construction                       to maintain occupancy at impacted properties
through the construction period 
Activity at Bell Harbor    Optimize activity levels     Consider attractive pricing models for functions
International Conference                      at Bell Harbor International Conference Center 
Center 
















Page 15

This page is intentionally left blank 














Page 16

REAL ESTATE DIVISION 2015 BUSINESS PLAN 
Appendix containing 2015 Business Plan Documents for: 
Harbor Services                  Pages A1-A8 
Portfolio and Asset Management        Pages A9-A15 
Real Estate Development and Planning    Pages A16-A18 
Marine Maintenance               Pages A19-A22 
Pier 69 Facilities Management          Pages A23-A25 











APPENDIX  REAL ESTATE DIVISION BUSINESS AND SERVICE GROUPS

This page is intentionally left blank 















APPENDIX  REAL ESTATE DIVISION BUSINESS AND SERVICE GROUPS

HARBOR SERVICES 2015 BUSINESS PLAN 
MISSION: 
To operate recreational marinas and commercial fishing harbors in a way that distinguishes us from other
marinas by: offering a full-range of products and services of value to vessel owners and commercial
businesses; delivering extraordinary customer service; operating efficiently and cost-effectively;
maximizing the return on the publics' investment; providing a rewarding work environment for our
employees; and promoting a spirit of partnership within the communities that we serve. 
We are the homeport to the North Pacific Fishing Fleet, the largest of its kind on the West Coast, and
provide full-service facilities at Fishermen's Terminal and the Maritime Industrial Center that provide
value to the commercial fishing fleet and other maritime businesses, while working toward achieving
breakeven financial performance. 
DESCRIPTION: 
Harbor Services operates five marinas in various locations throughout Seattle (listed below). There are over
2,000 moorage slips and approximately 3,000 customers, which includes the North Pacific fishing fleet and a
550-person liveaboard community at Shilshole Bay Marina. In addition, there are appproximately 13,000 guest
boaters annually. We offer a full range of both waterside and landside products and services to meet the needs
of a diverse group of vessel operators and other commercial businesses. We work closely with the Portfolio
Management Department which leases and manages certain assets on each of the five properties. 
Vessels based at Fishermen's Terminal fish for a wide range of species including salmon, halibut, cod, crab,
shrimp, pollock and tuna. Vessel types include crabbers, gillnetters, longliners, purse seiners, trawlers and
trollers. Depending on gear type and species, these vessels may fish anywhere along the Pacific Coast, from 
Alaska to California, but Alaska is by far the biggest destination for vessels homeported here. The fleet based
at Fishermen's Terminal and the Maritime Industrial Center, and throughout the Puget Sound region, accounts
for about 40 percent of the landed U.S. fish catch every year. 
Port facilities are: 
Bell Harbor Marina on the Seattle Central Waterfront 
Fishermen's Terminal at the north end of Seattle on the Lake Washington Ship Canal 
The Maritime Industrial Center to the west of Fishermen's Terminal on the Ship Canal 
Harbor Island Marina at the southwest end of Seattle at Terminal 102 
Shilshole Bay Marina in the north end of Seattle, west of Ballard, next door to Golden Gardens Park 
These facilities provide floating moorage slips, fixed piers, inside and outside storage, cranes/hoists, fuel
dock/store and other products and amenities, as well as supporting services to fishing, recreational,
commercial and Tribal vessels up to 400' and to other commercial businesses. 
Providing extraordinary customer service (GEM-Going the Extra Mile) is our primary focus. Customers 
include: commercial and sport fishermen; commercial pleasure and work boat operators; recreational boaters 
including mega-yacht owners; Tribal members; and other commercial businesses such as boating charters,
sailing clubs, yacht brokers, parasail operator, kayak rental, a fuel dock operator, Corinthian Yacht Club,
Seattle Yacht Club, International 14 Fleet, Seaview West Boatyard, Un-Cruise, to name a few.
There is a strong link between each of the facilities and our neighboring communities of Ballard, Magnolia,
Central Seattle Waterfront and West Seattle. 


Page A-1

STRATEGIES: 
Meet or exceed net operating income targets. Focus on new revenue streams and expense reduction
opportunities. 
Meet or exceed vessel moorage occupancy goals while maintaining market rates. Focus on retaining
customers and seeking out new business. 
Maintain assets to meet market demands and provide compelling value to our customers, while focusing on
earning a return on the publics' investment. Analyze future capital improvement alternatives considering
total cost of ownership and impact to the bottom line. 
Promote environmental stewardship by operating clean and green marinas/harbors and further educating
customers and the public. 
Support the Century Agenda and its maritime jobs objective by growing boating through partnerships with
organizations involved in the engagement of youth in maritime activities/events and boating programs. 
Enhance public safety and security by minimizing the risks of loss, both economic and physical, to the
public. 
Ensure continued development of our employees. 
INDUSTRY ASSESSMENT: 
Recreational Boating: 
Nationwide, marinas are cautiously optimistic about the slow but steady growth in the Recreational Boating
industry. New boat sales are making gains in Washington State according to industry organizations and
analysts. Most boat sales continue to come from the used boat market, however, new boat sales are just
showing improvement as new sport fishing boat sales remain strong despite the recent economic
downturn. Helping to increase boat sales is the improving access to consumer boat loans, which has led to
increased boat loans (2013 data). 
The industry continues to be challenged by trending barriers such as the affordability of boats and boating,
making boating more attractive to younger generations and minorities, and the emerging regulatory restrictions
through taxes and reduced access to water. In addition, boaters' expectations are driving up marina operating
costs by demanding moorage facilities to be more innovative in their approach toward customization,
automation and personalization. Amenities, finishes, and architectural details once considered high-end and
reserved for the most luxurious marinas are making their way into the mainstream. 
Fishing and Commercial:
The long-term financial forecast for the commercial fishing industry is stable mainly due to sustainable
fisheries in the Bering Sea and Gulf of Alaska. The Alaska fisheries are recognized as the most successfully
managed fisheries in the world, ensuring the success of the industry in the future. In 2014, salmon fisheries
are expected to be strong, however, halibut fisheries are expected to be soft. The forecast for 2015 has not yet
been released.
Fishing and commercial boat operations continue to remain strong in the Puget Sound region. Revitalization
of the large boat fleet is a good indicator of the health of the industry and commercial fishing companies
continue to plan for, and are starting to build, new boats to replace aging fishing vessels.
In addition to new vessel construction, the Puget Sound region benefits from dollars spent on maintenance and
improvements to commercial fishing boats in the off season. According to a 2012 economic impact study by
the Workforce Development Council of Seattle and King County, there were 57,700 workers and $30 billion
impact by the maritime industry to our region. 
Although Alaska ports are working to build better infrastructure to support the small boat fleets, Puget Sound
continues to be very attractive for off season moorage for all sizes of commerical boats due to better weather
conditions conducive to working on boats as well as an established parts and service network. 
Page A-2

Ecological threats to commercial fishing seem to have subsided with the EPA decision to not support the
development of the Pebble Mine in Bristol Bay and NOAA's finding that commercial fishing does not
negatively impact the stellar sea lion, which benefits the large vessel trawl fleet distant water fishers. 
BUSINESS ASSESSMENT: 
Recreational Boating: 
The Port of Seattle's Recreational Boating business has done very well over the past two years. Demand and
occupancy levels remain strong in monthly moorage at all facilities, achieving 95%+ occupancy at Shilshole
Bay Marina and Harbor Island Marina. Bell Harbor Marina's off-peak seasonal monthly moorage remains
strong. 
Shilshole, which has the majority of monthly moorage, attributes its continued high level of success to the
marina's location, state of the art docks designed with good maneuverability and wide navigation channels, a
strong and active liveaboard community, and the customer experience focused service the staff provides. To
off-set increasing costs and keep margins at current levels, it is apparent that we need to continue to look
at implementing new revenue streams. Customer needs have led to new business ideas which require more
study such as gear storage rental, off-season RV use, additional non-port events, expanding the liveaboard cap
and adding food trucks. There are plans in place to address these as well as exploring the following: paid
parking, other public transportation options since Metro bus service is no longer available on Seaview Ave.;
providing Wi-Fi service to our customers which is now a common amenity in the industry; and soliciting
development opportunities for an on-site restaurant (ground lease) to attract guest moorage customers and the
public. The marina will be facing a number of major improvements over the next five years such as:
replacement of 1960's restroom/shower/laundry buildings that are at the end of their usable life and do not
meet the needs of many of our customers; repairs to utilities; repairs to the mile long parking lot/pavement;
replacement of the fuel dock building (built in 1962); and rehab to two docks that were not addressed in the
2006-2008 Dock Replacement Project. 
Bell Harbor Marina relies on short-term guest moorage revenues and remains the only marina with easy
access to the downtown corridor primarily.  In the off season, a portion of guest moorage is changed over to
monthly moorage in order to increase revenues. Due to the down economy and high fuel prices, guest
moorage demand has dipped for Bell Harbor for the past two years. However, as the local economy is showing
signs of recovery, there is an optimistic belief that Bell Harbor has the highest potential for future growth in
terms of occupancy and revenue. New floatation has recently been added to the docks that will help extend the
life of this asset. In addition, the marina office has been remodeled to help better meet the needs of our
customers. BHM is facing a significant capital improvement in the next several years to extend the life of the
under pier pilings and wavebreak that protect the marina. BHM will eventually be affected by the waterfront
construction which could have an impact on its revenues in the future. 
Harbor Island Marina is an aging facility. Plans are in place in 2014 to repair one of the docks (Commercial
Dock E) that is in the worse condition. Future dock repair projects are planned to follow every two
years. Harbor Island Marina has a lower price point that is attractive to many cost-conscious boaters. This has
led to the marina realizing its highest occupancy for the past two years. We expect this trend to continue at
least for another two years as we continue to make repairs. A challenge for marina pricing is its proximity to
two concrete plants which produce dust on marina vessels. 
Fishing and Commercial:
Fishermen's Terminal/The Maritime Industrial Center: 
Commercial fishing vessel moorage demand remains steady with annual occupancy over 80%, even with the
majority of our customers leaving to work in Alaska for various parts of the year. Small commercial fishing
boats (<80') is the market that is most at risk due to the expense of operating a boat, owners retiring and boats
relocating. We are able to compensate for this loss of business to some degree by providing monthly moorage
for smaller recreational vessels which do not require year round moorage. 
Daily moorage demand for use of the loading docks on the West Wall and the Northwest Dock continue to
exceed supply at certain times of the year. Because many of our customers work in the same fisheries, they all
Page A-3

have the same deadlines and plans and aaccommodating all of them during key times of the year is
challenging.
Demand for gear storage, both inside and outside, continues to be strong with demand exceeding supply.
Currently there are no ground floor storage lockers (net sheds) available and all outside fenced storage gear
does not fit into the fenced storage areas resulting in net pallets loaded with gear being placed throughout the
terminal. 
Dock and moorage assets at Fishermen's Terminal are all fairly new with the oldest dock now approaching
thirty years old (Northwest Dock). Available shore power systems for the various sizes of boats continues to
set us apart from our competition. Over the next ten years, the capital plan for the entire Fishermen's Terminal
property calls for approximately $90M in projects such as the NW Dock improvements, Docks 3 & 4 rehab,
corrosion protection to seawalls, Net Shed buildings roof replacements, and the Maritime Industrial Center
west and central pier resurfacing. These projects are subject to the overall Port of Seattle capital plan funding
priorities.
The financial outlook for the terminal is projected to continue to be stable. The opportunity for increasing
revenues will come from increasing the number of recreational vessels, as the recapitalization of the distant
water large vessel fishing fleet will, for the most part, replace old vessels with new ones, not necessarily
adding vessels to their respective fleets. However, the recapitalization of the commercial fleet represents a
stable and well managed industry. Moorage rates at the terminal for fishing and commercial vessels are
comparable to the Puget Sound public ports market average. Recreational vessel rates are at market as
compared to local marinas. Possible upland redevelopment, as proposed in the "Fishermen's Terminal 25
Year Plan", is designed to increase revenue opportunities by developing additional retail and office to help
support Fishermen's Terminal financial goal to break even. The final redevelopment plan is contingent on the
Port of Seattle Commission direction.
CHALLENGES AND OPPORTUNITIES: 
Recreational Boating: 
Challenges 
Keeping facilities available, customers satisfied and revenues coming in, during upcoming capital
improvement projects including Seattle waterfront construction projects. 
Maintaining assets responsibly while continuing to generate enough revenue to realize a profit. 
Designing and rebuilding the Shilshole multi-use service buildings (restrooms/showers/laundry) in a
way that will meet the needs of our customers and at a reasonable cost. 
Accommodating the needs of mega yachts, a growing business in Puget Sound albeit slow growing,
e.g. power requirements, dock structure, and amenities for crew. Other ports are considering
expanding assets to capture growing mega-yacht business in the region. 
Implementing the requirements of new legislation such as the 2014 Derelict Vessel Bill. 
Opportunities 
Adding value to Shilshole Bay Marina and new revenues where possible through projects and grants
such as: Seaview Boatyard expansion, customer service buildings (restrooms/showers/laundry),
restaurant pad (ground lease), outdoor fitness trail, guest moorage kiosk, storage for boating
equipment, and bringing in more boatshows and 3rd party events. 
Leveraging partnerships to create opportunities with CorinthianYacht Club, The Adventuress, Seattle
Yacht Club, Northwest Marine Trade Association, to name a few. 
Working with commercial customers to enhance SBM amenities. 
Utilizing new technologies to create efficiencies. 
Fishing and Commercial: 
Page A-4

Challenges: 
Potential for further slow decline of the small boat fishing fleet (<80'). 
The price of fuel to vessel operators traveling to and from Alaska, likely at a new normal level. 
Poor weather conditions in June, July and August discouraging small recreational boat owners from
taking moorage. 
Capturing the new business from the revitalization of the fleet. 
Opportunities: 
Retain business from commercial fishing customers who are recapitalizing their fleets. 
Continue to grow the recreational vessel fleet. 
Use visibility of the fishing and maritime industry economic impact results to promote legislation that
would incentivise continued growth within the industry. 
2015 STRATEGIES AND OBJECTIVES 
STRATEGY: MANAGE OUR FINANCES RESPONSIBLY  INCREASE THE REAL ESTATE
DIVISION'S NET OPERATING INCOME 
Key Objective: Meet 2015 Financial Targets 
Performance Measure    Performance Target     Actions 
Harbor Services Total      NOI before depreciation    Review performance monthly and adjust
of ($TBD)             spending to meet the target. 
Execute the Marketing Plan and the
Operations Plan. 
Work collaboratively with Seaport
Maintenance to identify and implement
efficiencies throughout the year. 
Analyze additional revenue streams and
implement where feasible. 
Fishing & Commercial     NOI before depreciation    Same actions as above. 
Vessel Services          of ($TBD) 
Recreational Boating       NOI before depreciation    Same actions as above. 
of $TBDK 
Key Objective: Achieve Target Occupancy While Maintaining Market Rates 
Performance Measure    Performance Target     Actions 
Achieve moorage       Total Fishing: 79%       All staff continue to provide an
occupancy target by year-   FT:  79%               extraordinary customer service experience
end. 
MIC: 70%            (GEM-Going the Extra Mile) through a
welcoming attitude, clean facilities and
Total Recreational: 94%      docks, continuance of the GEM Program
SBM: 95%          and events. 
HIM: 95%          Operations and Marketing staff together
BHM: 74%           review monthly the occupancy, demand and 
trends. Adjustments to action plans as
needed. 
Increase daily and monthly  Increase daily and       Fishermen's: 
recreational moorage at     monthly recreational      Continue to implement where possible
Page A-5

Fishermen's Terminal      moorage over 2014         extending summer moorage availability at
Actual                  the beginning and end of the summer 
Continue outreach to recreational customers
letting them know moorage is available and
about the quality of our product via boat
shows, NMTA, meeting with customers and
marine vendor groups 
Recreational: 
Implement Marketing strategies/plans
specifically targeting guest moorage at
SBM & BHM through targeted marketing,
event advertising, creative partenerships and
outreach 
STRATEGY: IMPLEMENT CENTURY AGENDA STRATEGIES  USE OUR INFLUENCE AS AN
INSTITUTION TO PROMOTE SMALL BUINESS GROWTH AND WORKFORCE
DEVELOPMENT 
Objective: Foster New Business Opportunities for Local Businesses
Performance Measure    Performance Target     Actions 
Utilize small businesses     15% of direct expense.      When feasible, utilize qualified small
businesses 
Objective: Increase Work Force Training for Local Communities in Trade, Travel and Logistics
Develop a partnership with  Q4                  Work with Corinthian Yacht Club, Seattle
other maritime groups to                         Yacht Club, NW Marine Trade Assn. and/or
help expand youth maritime                      the Adventuress, etc. to develop a program
programs                                 that exposes youth to boating and the
maritime industry 
Hire interns              Hire by Q2              Hire an intern at FT and create a maritime
learning experience 
STRATEGY: IMPLEMENT CENTURY AGENDA STRATEGIES  BE THE GREENEST, AND
MOST ENERGY EFFICIENT PORT IN NORTH AMERICA
Objective: Integrate Business Friendly Environmental Objectives into our Organization
Performance Measure    Performance Target     Actions 
Implement an energy      Q4                 SBM: Pending review of the 2014 energy
efficiency improvement to                        efficiency evaluation, complete construction
outdoor yard & dock                          of outdoor yard & dock lighting at the
lighting at SBM & FT                          property (rebate by Seattle City Light) 
FT: Working with Environmental, complete
an energy efficiency audit and cost-benefit
analysis of outdoor yard & dock lighting
improvements. Decide if a project should be
created and implemented in 2016. 
Objective: Conduct Business Activities in Environmentally Appropriate Ways
Performance Measure    Performance Target     Actions 
Maintain Clean Marina    Certification maintained    FT: Maintain regulatory requirements to
Washington/EnviroStar    and/or achieved Q4        achieve EnviroStar recertification by year-
Page A-6

Certifications                                    end 
SBM/BHM/HIM: Maintain standards to
satisfy regulatory certification requirements
(certified every three years; 2013 last
certification) 
Enforce Marina Best      Zero regulatory         Marina staff continually educate customers
Management Practices     violations.              about the BMP's & agency regulations
(BMP's) & agency                         including enforcement. 
regulations. 
BMP Update Q4        Review FT & Recreational BMP's annually
with Environmental and update as needed 
STRATEGY: CONSISTENTLY LIVE BY OUR VALUES THROUGH OUR ACTIONS AND
PRIORITIES 
Objective: Increase Organizational and Individual O wnership for Safe and Secure Work Practices
and Healthy Living 
Performance Measure     Performance Target     Actions 
FT Net Shed Buildings     Complete the planned      Continue extensive communications and
Code Compliance       improvements by year-end    coordinate with PCS and FT customers to
improvements are                            complete interior net locker improvements 
completed                                 on schedule 
Coordinate with Maintenance and customers
any other planned improvements to the
interior of lockers so as to disrupt fishing
customers the least & gain cost efficiencies 
Attain perfect score on the   100% on YE 2014 Safety    100% of employees complete all
Health & Safety Plan audit   Plan audit (published Q1)      requirements and training as specified in the
facility Safety Plans 
Objective: Align Leadership, People and Systems with Strategic Priorities and Plans 
Performance Measure     Performance Target     Actions 
PREP Plans include clear     Complete meetings     Managers meet with employees to ensure
accountabilities, measures,      with 100% of           understanding of accountabilities, measures
and a Personal             employees by end of      including linkages of their work to the 2015
Development Plan          January              Division and Harbor Services strategies,
goals, and actions 
100% of PREP plans   Employees and Managers complete PREPS
are completed on time     on time 





Page A-7

Objective: Strengthen a High Integrity, Continuous Improvement Culture 
Performance Measure     Performance Target     Actions 
Implement either          Q4                Implement and complete the Work Plan
enhancements to the Marina                      including training of 100% of staff, working
Management System or a                       with ITC 
3rd party marina
management system 
Implement work process     Q1 process review &    SBM: Review all operation processes and
improvements utilizing the     prioritization           prioritize by Q1 
Lean process             Implement one new     FT and SBM: Review boatcheck process
process improvement     and automate it and the
by year-end            Maximo/Maintenance Work Order Process
Complete written        using new technology--IPad Mini 
procedures for key      Develop and complete written job
positions Q4            procedures for FT and SBM Front Desk &
Moorage Coordinator positions 
% Participation in diversity   100% of staff           Staff members will attend or participate in one
activities                                        diversity activity per year 
% Personal development    100% of staff          Each employee will include a personal
plan in PREP                              development plan in PREP; completion by year
by year-end 
STRATEGY: EXCEED CUSTOMER EXPECTATIONS IN MAINTAINING ASSETS 
Objective: Effectively Maintain Assets to Provide Compelling Value to our Customers 
Performance Measure     Performance Target     Actions 
Implement capital projects    Complete design of     Gain Commission funding approval for all
SBM customer service    projects. Work with Project Management to
center buildings          assist with completion of improvements per
(restroom, showers,       Plan 
laundry, storage) Q4     Complete Customer and Community
Complete design of      Communications and Coordination Plan
SBM Fuel Float         working with Public Affairs 
Building Replacement 
Q4 
Complete SBM lower
"A" Dock
improvements Q4 
Implement planning
and design of SBM
Paving improvements
Q4 
Complete design of
BHM Pile Wraps &
Wavebreak panels Q4 


Page A-8

PORTFOLIO & ASSET MANAGEMENT 2015 BUSINESS PLAN 
MISSION: 
The mission of the Portfolio and Asset Management Department is to strategically postion the Real Estate
Division's diverse portfolio of commercial real estate assets to achieve positive return on the public's
investment through effective asset management while ensuring compliance with all legal, financial, and
regulatory aspects of public entity ownership of real property. Our goals will be accomplished with
professionalism, integrity, and respect for the environment in support of the mission of the Real Estate
Division and in alignment with the Port's Century Agenda.
STRATEGY: 
The Portfolio and Asset Management Department's mission for 2015 will be achieved by managing and
maintaining the Port's assets with a focus on tenant retention and attraction, appropriate marketing and leasing
strategies and effective expense controls while meeting the needs of our tenants and customers. We will
continually and selectively evaluate the various assets within our portfolio to identify and pursue new revenuegenerating
opportunities and to implement strategic redevelopment plans for existing assets to respond to
changing market conditions and improve the value of each asset.
DESCRIPTION: 
Portfolio and Asset Management is responsible for the management of and planning for the Real Estate
Division's real estate portfolio consisting of commercial, office, retail, industrial, and hospitality properties.
The department will work to enhance the value of each asset through: 
Continual research and analysis of the local and regional commercial real estate market conditions 
Ongoing evaluation of the overall performance of each asset in the portfolio 
Development and implemetation of effective marketing and leasing strategies for each asset 
Collaboration and partnership with Real Estate's Marine Maintenance Department to ensure
appropriate levels of maintenance and operating efficiencies for each asset 
Pursuit of new revenue opportunities and sources through analysis of alternative uses of existing assets
and appropriate acquisition or disposition opportunities 
Effective administration of lease transactions for the Real Estate and Seaport Divisions 
Effective management and administration of all Port utility programs 
INDUSTRY ASSESSMENT 
COMMERCIAL REAL ESTATE MARKET (Puget Sound Region): 
The Puget Sound Region's commerical real estate market kicked off the first quarter 2014 on a positive note
with strong property sales, new tenants to the market, and the expansion of software & technology firms which
have resulted in improving vacancy rates and relatively more stabilized asking rates.





Page A-9

COMMERCIAL OFFICE, RETAIL, INDUSTRIAL AND HOSPITALITY PORTFOLIO 
The portfolio consists of mixed use properties situated within various local submarkets as follows: 
NORTH HARBOR - (Ballard/Ship Canal/Interbay) 
Fishermen's Terminal Office, Retail, Maritime, and Industrial 
Maritime Industrial Center    Office, Maritime, and Industrial 
Shilshole Bay Marina       Office and Retail 
Tsubota                Industrial, Retail, Land 
Terminal 91 Uplands        Industrial 
Terminal 86             Retail 
Office Rates (North Harbor): 
Class B & C Office vacancies have continued to decrease. The Ship Canal Market vacancy is currently at
6.5%, Ballard/University District at 2% and lower Queen Anne/Lake Union at 8.9%. The attractiveness and
popularity of Fremont, Magnolia, Ballard and Wallingford will continue to allow many buildings in the area to
retain tenants and sustain more demand than some of the other office submarkets.
The Maritime Industry has a large presence is the Ship Canal/Ballard submarket and has not been lured away
by the more attractive rates and incentives that have been offered in other submarkets. Market rental rates for
Class B office spaces are ranging from $16.50-$19.50/sf/NNN for nicer well-kept space, with rates closer to
$16.50/sf/NNN for space with aging improvements. Many properties in this sub-market are still offering
concessions that include a combination of abated rent and up to $40.00/SF for tenant improvements.
According to most industry reports, rates should continue to increase as consistent leasing and positive
absorption ease the pressure on landlords. 
Industrial Rates (North Harbor): 
The Puget Sound Industrial market is expected to continue to improve through 2015. Demand for industrial
users remains high.  Total regional vacancy rate is well below 7% with the Kent Valley at 5.83% and
Seattle/Close-In market at 3.79%. 
Warehouse/distribution rental rates are expected to hold steady or improve slightly through 2015 with the Kent
Valley averaging $0.39/sf/month, and Seattle/Close-In averaging $0.65/sf/month and Ship Canal area
averaging around $0.55/sf/month. Industrial land is ranging from $0.15 - $0.20/sf/month.  The Ship Canal
submarket is an extremely tight market and inventory is down.
CENTRAL HARBOR (Waterfront/Denny Regrade/Downtown Seattle) 
World Trade Center West           Office and Retail 
World Trade Center Seattle          Conference and Events, and Office 
Bell Street Garage                 Parking and Storage 
Pier 66                       Conference and Events, Office, and Retail 
Pier 69                          Office, Warehouse, Parking, Storage, and 
Water Dependent Tenants
Office Rates (Central Harbor): 
The regional construction pipeline is currently more robust than since prior to the recession and the significant
gap between urban and suburban rental rates will continue to widen. Owners who have embraced the move
toward creative open office space will gain traction with tenants who are favoring buildings with abundant
natural light, open floor plans, modern materials, and generous amenities such as state-of-the-art fitness
facilities with showers, large conference facilities and collaborative spaces with the latest technology. 
The Downtown Seattle office market is experiencing vacancies at 11.5% and the Waterfront/Denny Regrade
submarket, where the World Trade Center West building is located, is experiencing vacancies at 10.3%.
Class A office rents have remained relatively flat and the submarket is currently averaging $27.23/sf/year full
servicewhich represents a 1.8% decrease over the prior year. 
Retail Rates (Central Harbor): 

Page A-10

Waterfront/Denny Regrade retail submarket ended the first quarter of 2014 with a total vacancy rate at 3.0%.
Retail rents within the submarket ended the quarter with an average rate of $15.83/sf/year which represents a
5.3% increase over prior year. 
CONFERENCE AND EVENT CENTERS - Local Event Market Conditions 
Bell Harbor International Conference Center   Pier 66 
Maritime Event Center                Pier 66 
World Trade Center Seattle                    Central Waterfront 
Smith Cove Conference and Event Center         Terminal 91 
Columbia Hospitality, Inc. (CHI) is currently responsible for the management of the Port's conference and
event centers. CHI is reporting that conventions in the Seattle downtown core are down 14% from 2013.
2015 is expected to only be slightly better. CHI is cautiously optimistic about business growth opportunities,
indicating that meeting planning budgets are coming back, suggesting a trend toward groups getting back
together after a period of budgeting constraints over the past few years that negatively impacted the market
and are expecting limited change in supply in the Seattle's Conference and Event Center market through 2015.
A number of significant local hotel projects (some with substantial event space) have been announced or are in
planning stage. Several competing facilities have been updated, renovated and/or expanded within the past
eighteen months. 
SOUTH HARBOR, WEST SEATTLE (Georgetown/Duwamish, West Seattle) 
Terminal 34                    Office, Maritime Training, and Parking 
C.E.M. Site                     Industrial Land 
Pier 2 East and West               Industrial Land 
Terminal 5SE                  Restaurant, Retail, and Non-Profit Storage 
3300 Harbor Avenue SW          Land 
LOWER DUWAMISH (Georgetown/Duwamish, West Seattle) 
T-102 Harbor Marina Corporate Center  Flex (Office, Warehouse, and Storage) 
Flex and Industrial Rates (South Harbor/Lower Duwamish): 
Historic data indicates that the Flex market has experienced the least stability in vacancies and rental rates in
recent history. The Lower Duwamish area is considered to be a marginalized submarket as it is an industrial
area impacted by heavy terminal truck and train traffic and, with these challenges, this submarket is expected
to improve at a slower pace than other submarkets. The surrounding area is currently experiencing vacancies at
10% with market rental rates for flex warehouse at $6.13-6.20/sf/year NNN and office ranging $9.60-
$14.00/sf/year NNN. Many properties in this submarket and competing submarkets are offering concessions
that include a combination of abated rent and sizable allowances for tenant improvements. Industrial land is
ranging from $0.15-$0.20/sf/month NNN. 
OTHER - Eastside Rail Corridor 
The transfer of ownership of the remaining fifteen (15) miles of Eastside Rail Corridor to the City of
Woodinville and Snohomish County is expected to be fully completed by year-end 2014. In 2015, staff time
will be allocated to the rail corridor for various wind-down activities such as archiving documents and
responding to questions from the various new ownership groups as well as for conducting due diligence on
prospective "Transfer Property" identified by King County per the Eastside Rail Corridor Purchase and Sale
Agreement. When a transfer property is approved by the Port Commission, staff time will be required for
subsequent negotiations, appraisal activity and administrative efforts involved with a Purchase Agreement of
the transfer property subject to Commission approval. 
BUSINESS ASSESSMENT: 
Leasing and Marketing:
The occupancy level of our Commercial Properties is currently at 90% compared to a broader Seattle market
occupancy of 88%. We expect leasing activity to increase with improving economic conditions but will

Page A-11

continue to wrestle with local challenges (e.g. transportation infrastructure projects) on the Central Waterfront
and Duwamish. Corresponding increases in leasing activity are expected in most other submarkets. 
Operations and Maintenance: 
The commercial real estate industry's focus on energy efficiency has resulted in a downward trend in total
operating expenses with approximately two-thirds of the savings achieved in the utility category, underscoring
an industry focus on maximizing building efficiency.
A large portion of the operations and maintenance services related to the portfolio are provided through the
Real Estate Division's Marine Maintenance Department. Our teams will continue to work together to improve
operating efficiencies, reduce environmental impact, to budget appropriately, and to manage our expenses in
order to maintain and improve the value of our portfolio of real estate assets. 
Capital Investments/Improvements:
By the end of 2015, the Portfolio and Asset Management team is expected to have been involved in the
oversight of over $9.940M in capital investments being made in the commercial properties. Investments will
be reflected in sustained existing revenues and improved operating efficiencies intended to position the
properties for improving market conditions and opportunity for additional revenue.
CHALLENGES AND OPPORTUNITIES: 
Opportunities - Improving Revenue: 
The current real estate market appears to be trending toward continuing recovery which suggests more
opportunities for improving future revenue. 
Challenges - Improving Revenue: 
Having experienced high vacancy rates over an extended period, landlords of commercial real estate
will continue to aggressively pursue tenants looking for commercial space. Well-positioned and
maintained properties that offer attractive amenity packages more readily benefit from improving
market conditions. 
Compliance with legal, financial and regulatory aspects of public entity ownership of real property can
result in having a less competitive edge than the private sector in the commercial real estate market
(contracting procedures, security deposit requirements, and limited flexibility in negotiations). This is
likely to be reflected in achievable lease rates at the lower end of the market range and/or lengthier
vacancies through missed opportunities.
Locations of several properties within the portfolio provide only limited amenities such as public
transportation, shopping, dining, walking trails, etc.
Updating and refurbishing aging infrastructure will require forward planning and capital investment. 
Opportunity  Improving Operating Efficiencies: 
Trends in lowering total operating expenses through maximizing building efficiency supports
investments made in energy conservation initiatives. 
Challenges  Improving Operating Efficiencies: 
Improving operating efficiencies in properties with aging infrastructure and implementing energy
conservation improvements will involve forward planning and capital investment. 
Increasing regulatory requirements increase maintenance costs. 
Opportunity  Seattle Waterfront Improvements: 
The rebuilding of the Seattle Waterfront over the next few years presents a distinct opportunity to
leverage historical success and iconic heritage to update and refresh the Bell Street International
Conference and Event Center, the Maritime Event Center, the World Trade Center West and World
Trade Center Seattle in anticipation of renewed regional and international interest. 
Challenges  Seattle Waterfront Improvements: 

Page A-12

There continues to be concern with local businesses that will be affected by the Alaskan Way Seawall Project.
Perception in the market is that the disruption from the ongoing work currently underway on the waterfront
will continue to negatively effect businesses along the entire waterfront for the next several years with the
following potential impacts:
Loss of traffic capacity and parking, commute time congestion
Walking access is constrained, impacting tourist activity 
Customer, public, employee and supplier access to businesses are restricted and congested 
Negative impact to seasonal business volume from both the physical and perceptual blockages 
Negative impact of construction activity (i.e., noise, congestion, muck) 
Loss of key infrastructure on the waterfront that serve the public and customer needs 
Businesses along Piers 54-57 will be closed October, 2014 through June, 2015 
Potential tenant's employee access to waterfront office space may be impeded 
Limited shopping, activities, and dining choices for employees of potential office tenants 
Public and potential tenants may likely avoid the waterfront altogether 

Challenges  Improving Revenue Opportunities (Conference & Event Center) 
Trend toward "just-in-time" event planning and the shortening of lead time for events creates
challenges in forecasting and logistics. 
Updating and refurbishing aging infrastructure will require forward planning and capital investment. 
Competitive marketalthough no new facilities are planned for 2015, a number of event space venues
have recently opened or have been remodeled to be more attractive (the Red Lion on 5th Avenue, the
Chihuly Garden and Glass, the Conference Center at the Washington State Convention Center, and
MOHAI).
Cruise activity and departure times often conflict with opportunities for planned events and has had a
negative impact on event opportunities. 
Parking capacity is very low given capacity and demand, particularly at the Smith Cove Conference
and Event Center. 
Transportation options are limited.
2015 STRATEGIES AND OBJECTIVES 
STRATEGY: MANAGE OUR FINANCES RESPONSIBLY - INCREASE REAL ESTATE
DIVISION'S NET OPERATING INCOME 
Objective: Meet 2015 Financial Targets 
Performance Measure   Performance Target      Actions 
Administrative expense    $TBD thousand  (org     -Monthly budget variance review and
basis)                   adjustment in spending to meet target 
Commercial/Industrial    ($TBD) thousand         -Monthly budget variance review and
Property NOI                             adjustment in spending to meet target 
-Continue collaboration and partnership with
Marine Maintenance to manage the maintenance
and repair costs effectively 
-Effective and timely management of collection
of revenues 
Conference & Event     $TBD thousand          -Monthly budget variance review and
Centers NOI                             adjustment in spending to meet financial targets
-Continue collaboration and partnership with
CHI and Marine Maintenance to manage the
maintenance and repair costs effectively 
-Effective and timely management of collection
Page A-13

of revenues 
Objective: Achieve Target Occupancy while Maintaining Market Rates 
Occupancy of        Year-end occupancy rate    Develop and maintain an ongoing leasing and
Commercial Buildings at  will be 90% or better       marketing strategy for each asset that responds
year-end in 2015                            to current commercial real estate market
conditions that include recommendations for: 
-marketing 
-asking rates based on market conditions 
-concessions (i.e. improvement allowances and
rent abatements) 
-level of maintenance 
-capital improvements
-utilization of outside broker 
Objective: Generate New Revenue By Increasing Property Utilization 
Advance Fishermen's    Finalize recommendations   Portfolio and Asset Management will continue
Terminal 25 Year       of 25-Year Plan for Port    to lead the 25 year planning process with the
Redevelopment Plan in   Commission review and    support of the Harbor Services Group focusing
conjunction with the     approval               on gaining Port of Seattle Commission approval 
Century Agenda 
Advance Site Plan      Implement             Portfolio and Asset Management will support
Update at Shilshole Bay   recommendations from     and collaborate with the Harbor Services Group
Marina              updated site plan          in implementing 2015 Updated Shilshole Bay
Marina Site Plan recommendations for both
landside and marina improvements/assets 
STRATEGY: IMPLEMENT CENTURY AGENDA STRATEGIES - USE OUR INFLUENCE AS AN
INSTITUTION TO PROMOTE SMALL BUSINESS GROWTH AND WORKFORCE
DEVELOPMENT 
Objective: Foster New Business Opportunities for Local Businesses 
Performance Measure   Performance Target      Actions 
Utilize small businesses    10% of total expenditures    The majority Portfolio and Asset Management's
for goods and services (in    contracts are provided in conjunction with
conjunction with         operations and maintenance provided through
Maintenance)           Marine Maintenance and are reflected in their
department reporting. When feasible, will utilize
qualified small businesses when contracting
through our Central Procurement Office to
provide consulting and real estate services such
as surveys, appraisals, brokerage, and market
studies 





Page A-14

STRATEGY: IMPLEMENT CENTURY AGENDA STRATEGIES  BE THE GREENEST AND
MOST ENERGY EFFICIENT PORT IN NORTH AMERCA 
Objective: Integrate Business Friendly Environmental Objectives into our Organization. 
Performance Measure   Performance Target      Actions 
Support Port          Visit at least four properties  Real Estate managers and member(s) of
Environmental        per quarter.            environmental staff will inspect selected
Department's Tenant                       properties to ensure tenant compliance with
Compliance Program.                       lease environmental requirements 
Identify new "green"     1 new "green" initiative     All staff participate in effort to identify new
initiatives               identified by end of Q3.      "green" initiative that can be adopted. 
Green intiatives to be considered include energy
conservation projects involved in lighting,
heating and cooling; water conservation and
recycling programs 
STRATEGY: CONSISTENTLY LIVE BY OUR VALUES THROUGH OUR ACTIONS AND
PRIORITIES 
Objective: Strenghthen a High Integrity, Continuous Improvement Culture 
Performance Measure   Performance Target      Actions 
Identify and implement   Identify and implement one  Team will identify and implement new work or
work process         new work process        technology tools to improve effectiveness and
improvements         improvement tool and     consistency
further develop existing     Further develop Portfolio and Asset
tools                    Management's utilization of Sharepoint to
improve effectiveness in management of
resources, information gathering, records
retention, etc. involved in the management of
commercial real estate 
Further develop and formalize Portfolio and
Asset Management's written procedures for the
numeruous and varying processes involved with
managing commercial real estate 
% Participation in       100% of staff            Each staff member will attend or participate in
diversity activities                               one diversity activity per year 
% Attendance in real     90% of staff             Each staff member will attend at least two real
estate classes, seminars or                        estate classes, seminars or conferences 
conferences 
% Personal development  100% of staff           Each staff member will include a personal
plan in PREP                             development plan in PREP 
Director will develop and implement team
workshops related to real estate issues that
involve senior management 



Page A-15

REAL ESTATE DEVELOPMENT AND PLANNING 2015 BUSINESS PLAN 
MISSION: 
The Real Estate Development and Planning team plans and facilitates development of selected real estate 
assets currently within the Port's portfolio. The team also identifies and evaluates acquisition opportunities
outside the Port's current portfolio and completes ground leases and sales of Port assets. 
BUSINESS STRATEGY: 
In 2015, the team will continue to work toward completing transactions that will generate new, near-term
revenue. The team will also continue planning on sites that have a longer horizon for new revenue and job
generation. In addition, the team will continue to assist the Aviation Division with its off-airfield land
development program in the cities of Burien, Des Moines and SeaTac and the Seaport Division with key
initiatives as needed. 
DESCRIPTION: 
The team connects to the Port's mission of creating regional economic vitality by: (i) advancing the planning
and development of certain assets the Port currently owns and (ii) identifying and analyzing new opportunities
and projects and, where appropriate, completing these transactions. 
INDUSTRY ASSESSMENT: 
The real estate market continues to rebound from the severe downturn of a few years ago. According to
Colliers International, developers delivered over three million square feet of new industrial development in
first quarter of 2014 driven by strong tenant demand for new space. Nearly two-thirds of this space was
preleased with nearly one million square feet available throughout the region as of the end of the first quarter
of 2014. This new space increased regional vacancy rates, but given current demand, the space is not expected
to remain vacant very long. All markets throughout the region are experiencing positive absorption except for
the close-in Seattle market. However, the vacancy rate in Seattle remains only 4% compared to 5.5% across
the region. In the Kent Valley, which includes the airport market, speculative industrial development has
returned based on strong tenant demand for new space and rising rents. There are over 3 million square feet of
proposed industrial development scheduled for delivery through the end of 2014. 
BUSINESS ASSESSMENT: 
The group's strength lies in the relatively well-located portfolio of underutilized sites in Seattle and
surrounding the airport. This is particularly significant given the increasingly smaller supply of close-in, wellserved
industrial land available for development. The portfolio provides the group and the division with the
best opportunity to improve financial performance by increasing revenue over both the short- and long-term.
Disposition of the portfolio, however, will require a careful balancing of both financial and non-financial
objectivessome of which can only be realized over a longer horizonagainst potential short-term financial
gains. This is a dilemma faced by most landowners. Better managing this circumstance is an opportunity for
improvement, particularly given the favorable market conditions and the opportunities afforded by the
upswing in the real estate market.
CHALLENGES AND OPPORTUNITIES: 
Opportunity: relatively large portfolio of underutilized land, some of which can be positioned for
disposition with minimal investment. 
Opportunity: current market conditions appear to be fairly favorable given the ongoing rebound of the
real estate market. 
Challenge: market conditions are constantly in flux and ultimately drive the value that can be obtained
for any particular site. 
Page A-16

Challenge: some of the sites in the portfolio has encumbrancesboth physical and regulatorythat
constrain development. 
2015 STRATEGIES AND OBJECTIVES 
STRATEGY: MANAGE OUR FINANCES RESPONSIBLY - INCREASE REAL ESTATE
DIVISION'S NET OPERATING INCOME 
Objective: Generate New Revenue By Increasing Property Utilization 
Performance Measure   Performance Target      Actions 
Terminal 91 Uplands     Increase revenue and     Identify and execute additional short-term
revenue                utilization of the vacant     leases 
acreage              Complete negotiation a long-term ground
lease of the site or an alternative disposition
strategy for the vacant acreage 
o  Assumes developer RFP is issued in
2014 
Des Moines Creek       Owner's rep monthly    Monitor construction of first improvements
Business Park (DMCBP)    reports indicating        for consistency with the approved plans and
build-out                 construction consistent      specifications 
with approved plans and
specifications 
Coordinate permitting and plan review work
Second phase
with developer for the second phase
entitlements underway 
improvements 

Redevelopment planning   Consultant selected and   Finalize consultant selection and contract 
advanced on Burien        contract finalized 
Northeast Redevelopment
Area (NERA)          Monitor completion of   Manage the planning and design of the
consultant's scope on a     proposed infrastructure improvements as
monthly basis.            part of the FAA pilot program. 
o  Assumes FAA pilot program
application is submitted and
approved by the FAA in 2014 

Approve or disapprove   Review potential transactions from the
potential deals; secure      listing broker; pursue transaction as
commission approval as    warranted 
needed.                  o  Assumes listing broker is retained
in 2014

Redevelopment planning   28th Avenue S. Site:      28th Avenue S. Site: 
advanced on various City       o  Relocation plan       o  Complete plan and timeline for
SeaTac sites                    completed;             clearing this area of tenants in
Page A-17

Objective: Generate New Revenue By Increasing Property Utilization 
Performance Measure   Performance Target      Actions 
implementation         preparation for development 
started                o  Complete additional long-term
o  Joint planning          planning with the City of SeaTac in
scoped and            conjunction with the City's station
completed             area plan 
L-Shaped Site:         L-Shaped Site: 
o  Approve or         o  Review potential transactions from
disapprove            the listing broker; pursue
potential deals;           transaction as warranted 
secure                   Assumes listing broker is
commission               retained in 2014 
approval as
needed. 
DMCBP  Area 3:      Conceptual planning scoped and started. 
o  Scope and
initiate
conceptual
planning. 

Various acquisitions,      Complete transactions if   Transfer right-of-way needed by the City of
sales, leases and           feasible                 SeaTac for the extension of 24th Avenue S.
easements analyzed and                        that includes the former mobile home park
completed                                  property 
Monitor Sound Transit's compliance with
the temporary construction easements
associated with the Link light rail extension
to South 200th Street 
STRATEGY: CONSISTENTLY LIVE BY OUR VALUES THROUGH OUR ACTIONS AND
PRIORITIES 
Objective: Strengthen a High Integrity, Continuous Improvement Culture 
Performance Measure   Performance Target      Actions 
% Participation in       100% of staff             Staff members will attend or participate in
diversity activities                                  one diversity activity per year 
% Attendance in       90% of staff             Staff members will attend at least two
professional development                        professional development classes, seminars
class, seminars or                               or conferences 
conferences 
% Personnel         100% of staff            Each staff member will include a personal
development plan in                           development plan in PREP and complete the
PREP                              proposed elements 

Page A-18

MARINE MAINTENANCE 2015 BUSINESS PLAN 

MISSION: 
The mission of the Marine Maintenance Department is to maintain, preserve, upgrade, improve and enhance,
as directed, the assets owned by the Real Estate and Seaport Divisions. We conduct our activities in a manner
that fosters competitive business practices, customer service and benefit to the public and local businesses, as
well as environmental responsibility and conservation. 
We serve in support of the Century Agenda and tie our departmental goals to that plan and to the mission and
goals of the Real Estate Division. 

STRATEGY: 
Our business strategy is to fulfill the maintenance and property stewardship needs of our partners and
customers while acting as stewards of the assets in the public trust.
We conduct Preventive Maintenance and Corrective Maintenance to properly safeguard Port assets 
We engage in expense and capital improvements to support partner departments' business strategies 
We fully support the Port's business, community and environmental strategies with programs focused
on Economics, Equity - Social Responsibility, Environment, and Employee Engagement. 
We conduct our business activities in support of the Real Estate Division Strategic Goals to: 
Maintain occupancy levels and rental rates at or favorable to the broader market 
Prevent recurrence of the deferred maintenance backlog 
Offer and execute long term ground leases for land redevelopment 
Acquire or dispose of assets, as circumstances warrant 
Be aggressively defensive in asset management through 2016 to minimize economic damage
related to the reconstruction of the seawall and the construction of the Alaskan Way tunnel
and viaduct demolition 
DESCRIPTION: 
Maintenance disciplines include automotive, carpentry, marine carpentry, electrical, general labor, painting,
plumbing, sprinkler-fitting (fire protection), sheetmetal, welding, truck driving, sign writing, HVAC
maintenance and elevator/escalator maintenance. Maintenance also provides services such as storm water
pollution prevention, custodial labor, landscape labor, regulatory compliance and regulated materials
management which fall into the property stewardship area. Most maintenance activities required by Port assets
are available through the Marine Maintenance Shop, as are public works including small capital construction
services and environmental and safety compliance support activities. 
INDUSTRY ASSESSMENT: 
Maintenance services are provided in many different ways to local industries. Contract, ad hoc, emergency
response and fixed crew maintenance are all evident locally. There is no directly comparable market for the
breadth of services Marine Maintenance provides. 
BUSINESS ASSESSMENT: 
Marine Maintenance has an assignment that is different from other local government entities. It is also
different from that of Aviation Maintenance. The ages and types of properties are unique. 

Page A-19

In a recent study by TokuSaku Consulting, data was collected and comparisons made against established
benchmarks in clearly identifiable areas of maintenance. 
Marine Maintenance compared favorably with a broad range of private and public maintenance organizations
in cost of maintenance per rentable square foot. 
Locally, in a cost per catch basin comparison to the University of Washington, Marine Maintenance performed
at only two thirds the cost at UW. Similar results were noted in the comparison of fleet maintenance costs
between Marine Maintenance and UW. (Full study to be submitted to Commission.) 
CHALLENGES AND OPPORTUNITIES: 
Challenge - Changes in maintenance demands from Seaport and Real Estate may require reconfiguration
of Marine Maintenance service delivery 
Challenge - Increasing regulatory compliance requirements increase maintenance costs for business units 
Opportunity  Examine relocation of permanent MarineMaintenance Shop, which could offer
opportunities to review service delivery model and cultivate new efficiencies, while creating interesting
options for Real Estate related to the current Shop properties. 

2015 STRATEGIES AND OBJECTIVES 
STRATEGY: MANAGE OUR FINANCES RESPONSIBLY - INCREASE REAL ESTATE
DIVISION'S NET OPERATING INCOME 
Objective: Meet 2015 Financial Targets - Conduct Marine Maintenance Activites Efficiently and
Cost-Effectively 
Performance Measure   Performance Target      Actions 
Meet Authorized Budget   +/- 2%               Monthly review and adjustment in spending to
meet target 
Reduce Trouble Calls     <15%                Increase Preventative Maintenance 
Reduce Urgent        <15%               Reduce Trouble Calls 
Maintenance 
Increase level of Planned  40% of total non-emergent   Continue Planner activity, measure results 
Work             work              Devise measure and track 
Track Schedule breakers to facilitate reduction 
Expand Maximo      Fifty (50) users processing  Acquire units 
Mobility Pilot          work remotely            Measure remote usage 
Evaluate MM Shop     Full analysis, with       Analyze needs, location, cost and benefits of
location               recommendations          new location v. current 




Page A-20

STRATEGY: IMPLEMENT CENTURY AGENDA STRATEGIES  USE OUR INFLUENCE AS AN
INSTITUTION TO PROMOTE SMALL BUSINESS GROWTH AND WORKFORCE
DEVELOPMENT 
Objective: Foster New Business Opportunities for Local Businesses 
Performance Measure   Performance Target      Actions 
Utilize small businesses    15% of operating and       Track purchasing and contracting activities 
capital expenditures 
Objective: Increase Work Force Training for Local Communities in Trade, Travel, and Logistics 
Increase work force      Five Apprentices and      Utilize Apprenticeships and Internships 
training, job and business  Twelve Interns per year      Continue outreach to schools and support
opportunities for local                          organizations 
communities in trade,
Work with Aviation to share programs such as
travel and logistics 
Career Workplace Exploration ind Skilled
Trades (CWEST) 
STRATEGY: IMPLEMENT CENTURY AGENDA STRATEGIES  BE THE GREENEST, AND
MOST ENERGY EFFICIENT PORT IN NORTH AMERICA 
Objective: Integrate Business Friendly Environmental Objectives into our Organization. 
Conduct Marine Maintenance Activities in Compliance with Port Goals and Values 
Performance Measure   Performance Target      Action 
Compliance with existing  Maintain reduced tonnage   Zero increase in landfill waste from shop.
programs and initiation of  of landfill waste and       Ensure efficient collection & disposal of
new endeavors         increased tonnage of       garbage & ensure recycling 
recyclables. 
Compliance with       100% Compliance        Meet or exceed agency requirements for storm
environmental                           water leaving Port owned or operated facilities. 
regulations in the conduct                       Train 100% of available staff and craftspeople
of our activities.                                 in annual safety training day. 
Communicate regulatory changes during
monthly safety meetings. 
Maintain EnviroStar and  Certification is renewed at   Ensure EnviroStars Compliance 
Salmon Safe Certification  all facilities             Ensure Salmon Safe Compliance 
Reduce air pollutants and                       Track and reduce travel miles by Marine
carbon emissions                            Maintenance vehicles 
Continue to improve     100% of vehicles purchased  Use Fleet Replacement Program to find
Shop Emissions profile    are lower emisions types     opportunities and control purchases 
Identify new "green"     1 new "green" initiative     All staff participates to identify new "green"
initiatives               identified by end of Q3.      initiative that can be adopted. 



Page A-21

STRATEGY: CONSISTENTLY LIVE BY OUR VALUES THROUGH OUR ACTIONS AND
PRIORITIES 
Objective: Strengthen a High Integrity, Continous Improvement Culture 
Performance Measure   Performance Target      Action 
Identify work process    Identify one new tool to     Identify new work or technology tools to
improvements.         improve efficiency.        improve effectiveness (eg workflow,Akwire,
etc) 
Participate in LEAN programs 
% Participation in       100% of staff             Staff members will attend or participate in
diversity activities                                  one diversity activity per year 
% Attendance in classes,  30% of staff              Staff members will attend or participate in
seminars or conferences                          one development activity per year 
% Personal development  100% of staff            Each non-represented employee will
plan in PREP                                includes a personal development plan in
PREP 
Staff and craft personnel   Six (6) people actively         Opportunities documented and reported 
involved in development  engaged in development 
opportunities. 
% Compliance         100% of staff             All employees will comply with Workplace
Workplace Integrity                            Responsibility initiatives and Code of
initiatives and Code of                            Conduct 
Conduct 









Page A-22

PIER 69 FACILITIES MANAGEMENT 2015 BUSINESS PLAN 

MISSION: 
To provide, operate, and maintain a safe, secure, comfortable, productive, and efficient workplace. 

STRATEGY: 
Ensure functionality of the Pier 69 site by integrating people, place, process, and technology, with emphasis on
fiscal discipline, effective asset management, continuous process improvement, outstanding customer service,
optimal staffing levels, and environmental stewardship. 

DESCRIPTION: 
The department provides facilities management services for the Pier 69 site, including: 
Asset management 
Space management and planning 
Energy management 
Management and operation of mailroom, shipping/receiving 
Management and operation of conference center, commission chambers, and atrium meeting spaces 
Management and administration of access control, visitor management, and surveillance systems 
Management and administration of Pier 69 motor pool 
Management and contract administration of outsourced services 
Parking management and administration 
Operations and maintenance support for site tenants 
HQ reception services 
Administration of site Commute Trip Reduction (CTR) program 

INDUSTRY ASSESSMENT: 
The facility management profession continues to evolve and is becoming more complex. Expectations include
lower operating costs, increased productivity and efficiency, and a sharper focus on sustainability. Enhanced
business acumen is essential. 
The aging workforce is a reality  hiring and retaining top talent, effective professional development, and
succession planning are more important than ever. 
An aging building stock poses significant challenges as well. At the same time, building systems are becoming
more sophisticated and more reliant upon ever-changing technology. Space management strategies are being
forced to adapt to the increasing use of mobile communications and cloud-based computing. 
The need for effective facility management is increasing, and the outlook for the profession is strong. 

BUSINESS ASSESSMENT: 
Pier 69 Facilities Management exercises fiscal discipline through effective cost containment, optimal staffing
levels, effective asset management, and strategic timing of major capital and operating expenditures. 
Page A-23

Combined operating and maintenance expenses have been effectively contained over the past 10 years, with an
average annual expense of $2.1M or $9.62/sf. Staffing levels over the same period have been reduced from a
high of 12 FTE to the current 6 FTE through attrition and closure of the ineffective print shop. An asset
renewal/replacement plan is well established and underway. The facility earned the ENERGY STAR for
buildings designation in 2010. 
We strive to provide outstanding customer service, and continually look for opportunities to improve our
processes and increase our value to the organization. 

CHALLENGES AND OPPORTUNITIES: 
Maintenance of the 84 year old pier structure 
Maintenance, renewal, replacement, and modernization of major facility systems and components that are
near the end of service life 
Hiring and retaining top talent 
Succession planning 
2015 STRATEGIES AND OBJECTIVES 
STRATEGY: MANAGE OUR FINANCES RESPONSIBLY - INCREASE REAL ESTATE
DIVISION'S NET OPERATING INCOME 
Objective: Meet 2015 Financial Targets 
Performance Measure   Performance Target         Actions 
Manage within        Actual expenses are within 5% of  Review performance monthly for
authorized budget        approved budget              variance and make adjustments to
spending if necessary. 
STRATEGY: IMPLEMENT CENTURY AGENDA STRATEGIES  USE OUR INFLUENCE AS AN
INSTITUTION TO PROMOTE SMALL BUSINESS GROWTH AND WORKFORCE
DEVELOPMENT 
Objective: Foster New Business Opportunities for Local Businesses 
Performance Measure   Performance Target      Actions 
Utilize small and        10% of operating         Utilize qualified small and disadvantaged
disadvantaged businesses   expenditures            businesses where feasible. 
STRATEGY: IMPLEMENT CENTURY AGENDA STRATEGIES  BE THE GREENEST AND
MOST ENERGY EFFICIENT PORT IN NORTH AMERICA 
Objective: Integrate Business Friendly Environmental Objectives into our Organization 
Performance Measure   Performance Target      Actions 
Maintain or reduce      Electrical consumption is    Monitor and maintain building systems to
electrical consumption     within 5% of 2014 (POS    ensure that system components operate as
occupied space)          designed. Continue to explore opportunities to
ENERGY STAR score is   reduce electrical consumption. 
within 2 points of 2014
(Entire site) 

Page A-24

STRATEGY: CONSISTENTLY LIVE BY OUR VALUES THROUGH OUR ACTIONS AND
PRIORITIES 
Objective: Strengthen a High Integrity Continuous Improvement Culture 
Performance Measure   Performance Target      Actions 
All staff participate in     100% compliance          Each staff member will identify at least one
professional development                      development goal in their PREP plan. 
All staff complete       100% compliance         All training as listed in LMS is either completed
required training                              or scheduled. 
Objective: Increase Organizational and Individual Ownership for Safe and Secure Work Practices
and Healthy Living 
Performance Measure   Performance Target      Actions 
Maintain and update P69  Complete plan update      Ad hoc updates (contact information, etc.) are
FM COOP document    before end of Q3.        done throughout the year. Plan review/update is
completed before end of Q3. 
STRATEGY: EXCEED CUSTOMER EXPECTATIONS IN MAINTAINING ASSETS 
Objective: Maintain Assets 
Performance Measure   Performance Target      Actions 
Successful execution of   P69 Beam Rehabilitation    Provide influential and decisive leadership for
capital improvement and   Budget: $1.6  2M     Marine Maintenance, Seaport Project
expense projects           (estimate)            Management, and Engineering partners to
Completion by Q4 2015  ensure that projects are correctly defined,
Split project  both expense  scoped, and delivered on time and within
and capital improvement    budget. 
elements 
P69 HVAC System 
Major Component
Strategy 
Work with Engineering
to compare replacement
vs renewal strategies 
Develop rough order of
magnitude budget and
schedule 





Page A-25