A new state law that took effect in January 2020 has stymied the City’s plan for commercial development on a plot of land at Alameda Point. Assembly Bill No. 1486 requires cities, counties, special districts, and the state to first offer any and all “surplus” land to affordable housing developers before it can be leased for more than one year or sold. This legislation amended the Surplus Lands Act and, unbeknownst to the city when they supported the bill, swept in former military bases.
The city had received proposals from 10 commercial developers as a result of its marketing campaign in 2019. Each applicant was willing to pay at least the minimum listing price of $36.5 million for 22 acres in the Enterprise District and provide a construction timeline. The acreage is within the larger commercial and light industrial zone adjacent to Main Street, and includes the self-storage facilities. This new law meant that the City was unable to proceed with the selection process.
“It’s ironic,” said Nanette Mocanu, Assistant Director of Base Reuse & Community Development. “The City is a proponent for affordable housing and supported this legislation. We and many other communities were caught off guard when the legislation was applied to leasing and base reuse properties,” said Mocanu. “Cities across the state are working to find solutions to the unintended consequences of this legislation.”
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The city council will consider a staff proposal on April 15 to begin a major construction effort at the eastern entryway to Alameda Point, formerly known as the East Gate. The proposal seeks approval to solicit qualified developers for two parcels totaling 150 acres that would bring 800 new homes and a major sales tax generator.
The quest for developers is being proposed “in order to facilitate new residential and commercial mixed-use projects that are of a sufficient scale to support major infrastructure investment,” said Jennifer Ott, Chief Operating Officer for Alameda Point. “It will create a catalyst for additional new development and investment elsewhere” at Alameda Point.
The proposal seeks a single developer for an entire 68-acre parcel, dubbed Site A, which extends along West Atlantic Avenue from Main Street to the Seaplane Lagoon. It would feature a mixed-use, 800-home development that is consistent with the recently approved Town Center Waterfront Plan. The plan requires ground-floor retail along certain blocks and public plazas and amenities at the heart of the area. Hotels and office development will also be highly encouraged.
Site B is composed of 82 acres in southeastern Alameda Point. Part of the site is within the commercial Enterprise Zone and part is within the Town Center Waterfront Plan area. Unlike Site A, the proposal for Site B will entertain multiple developers. “This approach allows the city to potentially attract interest from a large corporate user or retail outlet operator, who may not be interested in the entire area,” says the staff report. Preference will be given to developers who furnish letters of interest from a corporate user or retail outlet operator.
The staff report notes that significant early phases of development can commence around a 33-acre area that is undergoing environmental cleanup by the Navy. The groundwater cleanup area is not scheduled for transfer to the city until 2020. One of the early defining phases of development will be the realignment of West Atlantic Avenue so that Ralph Appezzato Parkway continues in a straight line to Ferry Point Road.
The staff proposal outlines an aggressive schedule, which calls for bringing a short list of developer candidates to the city council by September. In November, the council will be asked to approve exclusive negotiating agreements with developers. By the spring of 2015, the staff hopes to produce development contracts and development plans, with developers beginning their detailed site-specific infrastructure designs. By the end of 2015, the schedule calls for beginning infrastructure construction and drafting the building designs, according to Ott. By the spring and summer of 2016, the city hopes to see vertical construction.
Developers will be required to submit a project description, but will be expressly prohibited from submitting site plans or any design renderings of any proposed development. “The selection of the developers/users will be solely based on the qualifications of the developers/users and the quality of their submittal, including past projects, not on the quality of any design drawings purporting to show the future of Alameda Point,” says the staff report. “Submission of a site plan or renderings at this stage of the process will result in disqualification of the responding entity.”
“City staff also receives significant interest in, and is actively pursuing, other long-term investment opportunities, such as the recently approved Google lease, in the other areas of the base, especially in the Historic District,” said Ott.
Current plans call for 1,425 housing units at complete build-out of Alameda Point, 25% of which are required to be affordable.
The Tuesday, April 15 city council meeting will be held at 7 PM at City Hall, 2263 Santa Clara Avenue, Council Chambers, 3rd Floor.
The city staff report and agenda exhibits can be found here.