(For more retail coverage, click GlobeSt.com/RETAIL.)
ALAMEDA, CA-Six years after the initial agreements were hammered out, Catellus Development Group this week obtained the last in a series of approvals necessary for its redevelopment of a former US Navy Fleet Industrial Supply Center here that sits on 81 acres. The waterfront facility served the nearby Naval Air Station Alameda, which is also slated for redevelopment.
Located on Oakland's inner harbor, Alameda Landing is slated to hold up to 300,000 sf of new retail development, 400,000 sf of offices and 300 single-family homes and townhomes. The master plan for the site is designed to encourage walking and cycling. Demolition work at the site is expected to begin this spring, with delivery of the first phase of office and retail buildings planned for the second half of 2008.
Catellus was selected as the master developer of the Alameda Landing site in 1997. Prior to its 2005 merger with ProLogis, it focused on the entitlement process and on development of the 485-home Bayport residential project adjacent to the Alameda Landing property. Catellus is also redeveloping Mission Bay in San Francisco; the Mueller airport in Austin, TX; and Los Angeles Air Force Base in El Segundo, CA.
Under the approved Alameda Landing disposition and development agreement, Catellus will receive title to the land from the city in exchange for bearing approximately $103 million in planning, cleanup and public infrastructure costs at the site. Catellus says it expects to recoup up to $56 million through proceeds from tax-increment bonds, community facilities districts and other public funds over time. Catellus will manage the entire development process, undertaking certain components of the project on its own and selling land to third parties for other components, such as the residential. The city will receive 50% of any returns Catellus achieves over an 18% IRR, according to the agreement.
Catellus is also in the running for the redevelopment of the 700-acre Naval Air Station, a badly contaminated chunk of waterfront land for which the Navy wants $108.5 million, of which it would use about $40 million to help pay for the environmental cleanup. The city's initial developer prospect--a JV of Shea Homes and Centex Homes--recently walked away from the table, prompting the city to issue a December request for qualifications to restart the process. Catellus is leading one of five teams that responded to the RFQ.
An open house, where the public can meet representatives from the companies, is scheduled for Jan. 23. The city council, acting in its capacity as the Alameda Reuse and Redevelopment Authority, is expected to pick a team before the end of the first quarter, and possibly as early as Feb. 7.
Shea Homes and Centex had planned to redevelop the property with 1,700 residential units and 150,000 sf of retail. The plan included the reuse of 300,000 sf of Navy buildings. The duo reportedly worked with the city for five years and spent millions of dollars trying to make the project work but ultimately decided the project would not be economically feasible.
Competing with Catellus for the project are Lennar Corp.; Irvine-based SunCal Cos.; and a partnership led by United World Infrastructure, a recently formed Delaware-based holding company that plans to open offices in New York and San Francisco. San Diego-based Corky McMillin Cos. this week removed itself from the competition, citing the complexity of the project.
Lennar's base redevelopment experience includes Hunters Point and Treasure Island in San Francisco and Mare Island Naval Shipyard in Vallejo. SunCal's experience includes developing the 293-acre Amerige Heights community in Fullerton on the site of a former Howard Hughes defense research facility. SunCal also plans on building 960 homes and an 82,000-sf commercial center on the former Oak Knoll Naval Hospital in Oakland, a 167-acre property it acquired for $100.5 million. United World Infrastructure does not have a history of developing former military bases. Corky McMillin developed Liberty Station on the former Naval Training Center in San Diego.
Want to continue reading?
Become a Free ALM Digital Reader.
Once you are an ALM Digital Member, you’ll receive:
- Breaking commercial real estate news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
*May exclude premium content© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
