Coliseum City Proposal Would Build at Least 5,750 Units of Market Rate Units But No Guaranteed Affordable Housing

Mar 21, 2015

By Ken Epstein

While many people are looking at the proposed Coliseum City development as the best and last chance to keep the Raiders and A’s in town in exchange for glitzy new stadiums, not as much attention has been given to the investment possibilities that may be just as, or more important, to developers and their hedge fund backers – market rate housing that could go for $3,000 or more a month per unit and commercial development.

Alongside the stadiums and sports-related entertainment and hotels, the goal is to “create a new residential neighborhood with an array of housing options, ” according to the draft Coliseum Area Specific Plan.

The plan would change zoning and land use guidelines for the 800 acres that include the Coliseum, the area around the Coliseum BART Station and the Oakland Airport Business Park located more or less between the Wal-Mart store next to Hegenberger Road and the 66th Avenue exit on Highway 880.

What is at stake for Oakland in this project is not just the promise of future jobs, which may or may not materialize, but existing jobs.

According to many community activists and business observers, if the general plan and zoning proposals associated with the Coliseum Area Specific Plan are allowed to go ahead, they would effectively eliminate the city’s only dedicated office-industrial park.

By amending zoning to “Mixed Use” the plan could incorporate tech campuses’ desire to house high end workers in luxury condos close to their work place.  Or alternately the zoning change could threaten many of the business types the plan actually encourages to stay and/or relocate there, including technical campuses with R&D, administration and manufacturing on site, production such as high value printing operations, specialty artisan food production, wholesaling for domestic markets and global export products such as wine, specialty agricultural and marine products.

The result would potentially push out many of the 150 businesses there now, which employ over 8,000 workers. Many of these are good stable jobs, such as warehouse, that pay $50,000 to $75,000 a year. Such jobs are the city’s future, and the subject of multi-million dollar regional studies such as the Regional Goods Movement Study, and the Design It Build It Ship It Logistics & Advanced Manufacturing study.

The way the proposed general plan amendments would work, knowledgeable observers say, is that when a major part of the industrial park is changed by to allow retail and residential units, the market value of the land would more than double,

Some businesses would leave because rising market values would encourage them to sell their properties, and others would be increasingly impacted by nearby residential uses that are not very compatible with production, warehouse and other industrial uses, with their noises, smells and truck deliveries.

Revolution Foods, headquartered in the Airport Business Park, is one of the businesses that could be adversely affected by residential development. According to Fortune, the company serves over 200,000 healthy meals daily to school districts across the country and has a total of over 1,0000 employees, at an annual gross revenue of about $70 million.

At present, the Environmental Impact Report (EIR) calls for the project to contain 5,750 units of housing, including, 1,700 units in the area between Edgewater Road and the San Leandro Estuary where the city’s highly used corporation yard is located.

According to city staff and the proposed EIR, residential housing use would not be permitted in most of the business park. Industrial land use zoning will be maintained, they say. So, there is nothing for local businesses and workers to fear.

But all may not be what it seems.

The proposed general plan amendments and the zoning changes in the EIR are two different documents that contradict each other for the areas known in the plan as CO-3 & CO 4.

The proposed general plan amendment to Regional Commercial (CR) would allow 125 residential units/gross acre, and both CR and Business Mix (the current non-residential designation) allow residential units.

Another general plan change would allow 250 residential units per gross acre.

While the plan has a goal of a minimum of 15 percent of affordable housing units, city staff says that building units that can be affordable to Oakland residents will depend on future negotiations between the City Council, investors and a developer.

There is no ironclad promise of affordable housing built into the plan at present.

According to city staff, the plan to move the city’s corporation yard would have to overcome many hurdles and is not in the cards at present.

The corporation yard and all its employees would have to be moved at a cost that is not yet calculated and to a site that has not yet been determined.

In addition, the property is owned by the Port of Oakland and leased by the city – which would have to find a way to obtain the land from the port. By law the port must charge the land’s full market value.

The port has never said it favors this change and traditionally has wanted no residential at all in the Business Park.

Yet the general plan and zoning changes have forged ahead despite community and business owners’ complaints that they have not been involved in the process.

City staff have repeatedly said in public: “We have our marching orders.” But they have not explained from whom these orders are coming.

The specific plan passed the Planning Commission last week and is scheduled to be heard next Tuesday, March 24, 1:30 p.m., at the meeting of the Community and Economic Development Committee at City Hall.

From there, the proposal will go go to the City Council.