PORT OF SEATTLE 
MEMORANDUM 
COMMISSION AGENDA               Item No.       4k 
ACTION ITEM             Date of Meeting   February 23, 2016 

DATE:    January 11, 2016 
TO:      Ted Fick, Chief Executive Officer 
FROM:   W. Allan Royal, Manager, Real Estate Development 
SUBJECT:  Second Addendum to the Amended and Restated Second Development Agreement
with the City of Des Moines 
ACTION REQUESTED 
Request Commission authorization for the Chief Executive Officer to execute an addendum to
the Development Agreement the POS has with the City of Des Moines surrounding development
of Des Moines Creek Business Park.  This amendment is needed so the Federal Aviation
Administration headquarters project can break ground on construction this Spring.
SYNOPSIS 
The Commission entered into a Development Agreement with the City of Des Moines to
facilitate development of the Des Moines Creek Business Park. The proposed addendum allows
the FAA headquarters site to comply with layout and specific General Services Administration
(GSA) requirements. As the property owner, any modifications to the City's development plan
must be approved by the Port.
BACKGROUND 
At the October 28, 2014, meeting, the Commission authorized execution of the first addendum to
the Amended and Restated Second Development Agreement with the City of Des Moines (City)
to enable the initial development of the Des Moines Creek Business Park. The original master
plan design for the site was done speculatively. The new developer has requested acceptable
changes that require this plan amendment. 
The development agreement addresses the roles, responsibilities, and obligations between the
Port, as the owner of the business park site, and the City as the permitting authority. Panattoni,
as the developer, has assumed the Port's obligations under the development agreement as
provided for in the option agreement.

COMMISSION AGENDA 
Ted Fick, Chief Executive Officer 
January 11, 2016 
Page 2 of 4 

This second addendum is needed in order to conform the Master Plan, short plats, street designs
and other design issues specifically related to the development of the Federal Aviation
Administration's Headquarters building. These changes will allow the property to comply with
layout and specific General Services Administration (GSA) requirements.  The building will be
approximately 300,000 square feet and be home to 1,600 to 1,700 employees. 
The proposed second addendum vacates Tract E, provides for alternative landscaping to
accommodate GSA security requirements, revises the Master Plan, and dedicates a new internal
circulation road. All of these changes are needed to comply with GSA design standards.
PROJECT JUSTIFICATION AND DETAILS 
The original master plan was created prior to the Federal Aviation Administration Headquarters
proposal was published. The action requested provides the modifications necessary to comply
with the unique security and layout requirements detailed in the General Services
Administration's solicitation. Without this amendment, the present master plan does not comply
with FAA requirements and the final agreement would not be completed. 
Project Objectives 
Amend the master plan agreement with the city of Des Moines to accommodate the Federal
Aviation Administration Headquarters. 
Design an alternative interior street alignment. 
Vacate one street internally. 
Modify landscape requirements to meet security requirements. 
Scope of Work 
Amend the master plan and modify the short plat accordingly. 
Schedule 
The ground lease will be before Commission for approval in April 2016. This amendment needs
to be in place before the lease is executed. The city council of Des Moines has already approved
the amendment on January 21, 2016. 
FINANCIAL IMPLICATIONS 
The development plan of action envisioned a three-phase construction over six years. The plan
was designed to accommodate the lease absorption ability of such a large project. The action
being taken affects both Phase 2 and Phase 3, which means Phase 2 is developed on time but
Phase 3 will be in development two years ahead of schedule and Port rental income will begin
well ahead of the original anticipated schedule.

COMMISSION AGENDA 
Ted Fick, Chief Executive Officer 
January 11, 2016 
Page 3 of 4 
STRATEGIES AND OBJECTIVES 
The location of a key federal agency will attract other users who frequently work with the
Federal Aviation Administration. They will act as an anchor tenant for other development in the
area. The influx of 1,600 to 1,700 new customers to the area will provide significant benefits to
the local community. In addition to the attraction of a large, Class-A building, there are also
enhancements of the trails and walkways in the area. The developer is striving for LEED Gold
on both the building and interior. 
ALTERNATIVES AND IMPLICATIONS CONSIDERED 
Alternative 1)  Do not approve the requested modifications to the Second Addendum. 
PROS: 
There are no reasonably viable reasons to deny the request. 
CONS: 
This action would  make GSA reconsider the award for the Federal Aviation
Administration headquarters and potentially move to one of the alternative sites that were
proposed. 
The loss of the FAA Headquarters would cause the developer to seek other deals, which
causes a considerable loss of time. The developer would not exercise their option to lease
now but could wait as long as 2018. The delay, based upon the estimated rent numbers,
would cost the Port approximately $800,000 in lost revenue because of the potential loss
of the tenant and the developer not exercising their option until required in 2018, losing 2
years of ground lease income. This is not the recommended alternative. 
Alternative 2)  Approve the Second Addendum as proposed.
PROS: 
This will allow the developer to proceed with its planning and permitting process
required to start the construction of the office building. 
The Port will receive approximately $400,000 a year in land rent starting in 2017, due to
this part of the ground lease being optioned 2 years earlier than originally scheduled. 
1,600 to 1,700 FAA employees will be located in the city of Des Moines. 
CONS: 
There are no known objections to the approval. This is the recommended alternative. 
ATTACHMENTS TO THIS REQUEST 
Attachment 1  Second Addendum to the Amended and Restated Second Development
Agreement 
Slide presentation

COMMISSION AGENDA 
Ted Fick, Chief Executive Officer 
January 11, 2016 
Page 4 of 4 
PREVIOUS COMMISSION ACTIONS OR BRIEFINGS 
October 28, 2014  The Commission authorized the execution of the First Addendum to
the Amended and Restated Second Development Agreement. 
June 10, 2014  The Commission authorized execution of an option agreement and
related ground lease agreements with Panattoni Development Company Inc. or an
affiliated entity; and (2) an amended and restated second development agreement with the
City of Des Moines.