A Closer Look at SunCal

by Peter Snarr---Oak Knoll, the 188-acre project in the Oakland Hills being redone by the Southern California developer SunCal, isn’t the first property that the company has tried to develop in the Bay Area, and many of the concerns about its past area projects are now presenting themselves in Oakland.

Proposed in 2005, the Oak Knoll project has already worried residents because of the lack of community input SunCal has taken regarding it. Some in the community are concerned about the lack of local businesses planned for the area’s commercial center, and the sudden radio silence from SunCal to local unions regarding a project labor agreement for the development.

Other communities in the Bay Area have expressed similar concerns about past SunCal projects.  In 2010, Alameda residents resoundingly rejected (by a 85 percent to 15 percent margin) Measure B, a SunCal sponsored-initiative that would have paved an easier path for the company to redevelop the old Alameda Naval Air Station. Opponents stated that, if passed, the measure would unnecessarily destroy and alter existing housing on the site, as well as threaten Alameda historical sites.

The measure was not supported by two area newspapers, including the San Francisco Chronicle, which wrote, “[the plan] generally embodies the type of ‘smart growth’ this region should be encouraging, [but overreaches by] presenting voters with an up-or-down decision on a highly detailed, nearly 300-page development agreement that would provide [SunCal] with a huge hammer over the city in future negotiations.” 

The East Bay Express went even further and said, “Alameda’s Measure B may be the most ill-advised local ballot initiative in recent memory.”

After the vote, the City of Alameda backed out of negotiations with SunCal over the naval base property, stating that SunCal didn’t address traffic concerns, or the displacement of the California Least Tern, an endangered bird. SunCal responded by suing the city, alleging that a city worker sabotaged negotiations. The city eventually settled and paid SunCal $4.25 million.

Alameda City Councilmember Frank Matarrese, who voted not to extend SunCal’s contract in 2010, cautioned against doing business with the development company.

“Looking at hindsight, SunCal is a very savvy company,” Matarrese said. “I wouldn’t call them a developer. They're more of an investment company that takes land, gets it entitled, and makes money off it. They’re big, they’re a very tough player to deal with. They play for keeps. They play to win. They’re very good at winning. I’d be very weary of them as a public-private partner.”

In recent years, SunCal has attempted to further establish itself in the Bay Area. After a rough period during the 2008 recession where the company lost its financial partner Lehman Brothers to bankruptcy, and lost a 55,000-acre development in Albuquerque to foreclosure, the company has attempted to buy up stalled projects at a cheap price.

In 2015, SunCal competed with Lennar Urban and Catellus Development for a contract to redevelop another former naval site in Concord. SunCal ended up losing the bid, with the Concord City Council expressing concern that the development company had weaker experience redeveloping military bases, and that it would not be a principal equity holder. 

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  • Peter Snarr
    published this page in Archive News 2017-03-17 09:50:30 -0700