Oakland renter support groups seek more concessions at second project

Another Oakland project is facing demands for more affordable housing and monetary concessions from renter support groups. - Written by Roland Li - Posted May 25, 2016

Article source: Roland Li, San Francisco Business Times – May 24, 2016

Another Oakland project is facing demands for more affordable housing and monetary concessions from activists led by Lailan Huen, the daughter of former mayor Jean Quan, in another example of escalating backlash against new development.

Community groups are targeting Wood Partners’s 262-unit residential proposal at 226 13th St. on an existing parking lot, which is a block from another project that the same groups appealed: Bay Development’s 126-unit residential tower at 250 14th St. The appeal for the Bay Development project was withdrawn last month only after the developer agreed to hundreds of thousands of dollars in additional concessions.

The previous agreement appears to have emboldened activists, who are now calling for Wood Partners to provide similar concessions. Activists are calling for 25 percent affordable units in what is currently proposed a fully market-rate project, which would likely require millions in subsidies. According to a letter sent to the city’s Planning Department last week, the activists also seek below-market-rate retail space with rents of $1 to $1.50 per square foot, public open space, and 25 parking spaces or a $50,000 payment to fund parking.

“We urge you to take the concerns expressed below seriously, as we are fully prepared and ready to organize the community and actively fight any development that does not mitigate displacement of our neighborhoods,” stated the letter, which was signed by groups including the Black Arts Movement & Business District, Community Rejuvenation Project and members of the nearby Malonga Casquelourd Center for the Arts.

Oakland’s Planning Commission is scheduled to vote on whether to approve the project on June 1.

The call for more concessions highlights an ideological clash when it comes to new housing. Some activists claim that new market-rate development will accelerate displacement of existing residents even if it isn’t demolishing existing housing, because wealthier newcomers will flood the neighborhood as a result of new buildings, driving up rents. As a result, it should provide more benefits to neighbors, they argue.

“Thousands of current residents are angry and bitter about the new development coming into Oakland, profiting off of our public and cultural resources, and we need developers to show that we can build inclusive housing while benefiting all sides, not to continue building exclusionary and segregated housing,” the Oakland community groups wrote in their letter.

But government officials, including Mayor Libby Schaaf and the state’s Legislative Analyst Office, have stated that more market-rate development will mitigate rising rents by creating more housing supply and already pay fees to the city, which can be used to fund more affordable housing. A recent LAO report argues that making it easier to build housing and removing additional approvals will make housing more affordable to everyone, including lower-income tenants.

That view hasn’t convinced opponents of new housing projects in areas including the Mission, the Tenderloin and, in Oakland’s most high-profile case in the past year, at a public parcel near Lake Merritt. Activists are calling for more concessions from Wood Partners in part because the project requires a major conditional use permit because of its size, and because it isn’t subject to new development impact fees for affordable housing that begin in September.

Brian Pianca, director of development at Wood Partners, said the company is in discussions with activists around community benefits. He said that Wood Partners had secured an investor for the project, but he declined to name the partner and the budget. Pyatok is the architect, and no general contractor has been selected. Wood Partners is also currently building a 196-unit project at 2302 Valdez St., one of the largest buildings that has started construction this cycle.

Sources with knowledge of the project said the financing for the 13th Street project could be at risk because of the opposition. They also said that Wood Partners had previously conducted community outreach, but demands grew after its neighbor Bay Development agreed to concessions, and that Huen was one of the loudest voices calling for more benefits. Huen, whose mother Jean Quan supported impact fees on market-rate development, said she didn’t have any plans to run for elected office.

Alex Ludlum, a land broker at Polaris Pacific who isn’t involved in the Wood Partners project, said that historically there’s been more opposition to new projects around Chinatown and Lake Merritt, in contrast to Oakland’s Broadway-Valdez district, which has seen over a dozen new major proposals but virtually no opposition.

“Lake Merritt contains Chinatown and the Gold Coast, residential neighborhoods that have a history of feuding with city redevelopment agencies. Sometimes, the grassroots campaigns were wholly justified, as during the city’s egregious use of eminent domain to create the 880 overpass,” said Ludlum. “Needless to say, the project on 13th Street is different in nature – a private landowner partnering with a private developer to create new housing stock on what is now an empty block, in an area that hasn’t seen new construction in a decade.”

Developers have expressed concerns that the economic cycle may be slowing, and despite numerous projects receiving approvals, only a handful have begun construction, because financing is still challenging to secure. More demands for concessions could further dampen housing construction throughout the city.

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