City Council to consider new development strategy for Alameda Point

City Council to consider new development strategy for Alameda Point

Michele Ellson

The City Council is set tonight to consider a proposed development strategy for Alameda Point, most of which is expected to be in the city’s hands by the end of this year.

City officials want to divide the Point property into three separate areas – two commercial, one residential – that they would prepare for reuse and development, a departure from earlier efforts to get developers to do that work instead. They’re saying the new strategy would offer the city more certainty and control over development at the Point, and could expedite development efforts there.

“Two times, the city went to a developer to entitle the property. That didn’t work, even in good times,” City Manager John Russo said during an update to school board and City Council members on Monday.

Russo said he’s hoping the property will have approvals for construction within the next 18 months. The predevelopment work will cost an estimated $5 million – money city staffers hope to generate by bonding against existing Point lease revenues.

City staffers expect to collect more lease revenues than they spend maintaining the base starting in 2013 and continuing through 2016, according to the staff report to the council. Other options for funding the plan’s predevelopment costs include getting a future developer to reimburse them and paying them off using land sale proceeds, a report to the council said.

The northern portion of the Point, which borders the Bayport housing development and includes the Alameda Point Collaborative housing, Ploughshares Nursery and former officer housing known as the “Big Whites,” could see development of between 1,400 and 1,500 homes, neighborhood retail and parks, according to Russo and the staff report. Mixed-use and larger retail development could also be placed along Atlantic Avenue.

The city would create a detailed plan for this portion of the Point, offering land use and street plans and architectural guidelines, and then sell off finished “super pads” to developers who would build on them.

Leasing activities would continue in the Point’s historic district, and city officials would seek longer-term leases that would prompt businesses to invest in improving the buildings they’re using. And under the proposed plan, the city would seek another major campus user like Lawrence Berkeley National Laboratory to occupy the southern portion of the Point. Lab managers had considered Alameda Point as a potential home for a planned second campus.

A big question confronting city leaders is how they will pay for water and sewer lines, roads and other infrastructure for the Point projects. Russo said Alameda and other cities seeking to revitalized shuttered military bases, including Concord, that are seeking legislative sponsors for a bill that would allow the cities to set up special finance districts to pay infrastructure costs. As they’re used now, the districts allow those costs to be funded by property tax revenues, just as the city had planned to fund them when redevelopment was still alive.

If that doesn’t work, Alameda Point Chief Operating Officer Jennifer Ott said in an earlier interview, the city will need to seek other options for funding new infrastructure for the Point. City leaders placed $165 million worth of Point improvements on a list of redevelopment bills they say they’re required to pay, though Ott has acknowledged those costs won’t likely be covered by redevelopment funds.

The city had originally planned to allow about 1,700 homes to be built on Alameda Point, and in 2001 they hired a development and finance consortium called Alameda Point Community Partners to do the job. But the last of the partners backed out in 2006. The city then entered a negotiating agreement with SunCal Companies, whose plan to build more than 4,500 homes at the Point was soundly rejected by voters. That company is suing the city for $17 million it paid in predevelopment costs.

After the council effectively booted SunCal off the Island in July 2010, some City Council members suggested the city set up its own nonprofit corporation to develop Alameda Point. The city of Irvine did that to redevelop the Marine Corps Air Station El Toro, though critics of the arrangement have criticized what they saw as the slow progress there.

Irvine and other cities, including Tustin, Novato and Concord, have taken the lead on redeveloping their former military bases, the staff report says.

More than a dozen developers expressed interest in the Point in the wake of SunCal’s departure, and Ott said the interest continues.

“There’s interest in the development community, and as we move along, there’ll be a lot more interest if we take some of the uncertainty out of the equation, especially in this economic climate,” Ott said.