In wake of mural fight, Oakland developer agrees to hundreds of thousands of dollars in concessions
The developer of
an approved 126-unit residential tower in downtown Oakland has agreed
to pay hundreds of thousands of dollars in additional community
concessions in one of the biggest financial victories for community
activists, who criticized the project's impact on parking and blocking
views of a mural.
After negotiations mediated by City Council president Lynette Gibson McElhaney,
Bay Development has agreed to pay $100,000 to replace an adjacent
mural, subsidized with $40,000 in public funds, that will be blocked by
the construction of the project, at 250 14th St.
Bay Development
will also pay $160,000 for renovations at the neighboring Malonga Center
for the Arts and $15,000 in parking mitigation funding for Malonga
staff and residents. The project's art fee, equal to 1 percent of the
project's commercial space value and 0.5 percent of its residential
value and estimated at around $225,000, will also go to the Malonga
Center for the Arts if the city is able to modify its ordinance. All new
projects are subject to the fee but can currently only build art
on-site or pay into a general fund.
"We thank
Council President McElhaney for bringing everyone together. As a result,
we were able to formalize the commitments we already talked about
previously – supporting the replacement mural and the Malonga," said Maria Poncel, principal of Bay Development.
Market-rate
projects proposed in Oakland in recent years have rarely attracted such
demands, although project labor agreements to use union builders are
more common. The controversial UrbanCore proposal to build a tower on
public land near Lake Merritt agreed to pay $8 million for affordable housing, but opponents weren't satisfied, and the city eventually restarted the developer selection process.
The city is seeking to implement new impact fees
to fund affordable housing, but approved projects may be able to avoid
the fees by starting construction prior to a deadline. It's unclear when
the 250 14th St. project will start construction.
Community groups
will now withdraw their appeal of the project's approval, which was to
be heard by the City Council, and their $1,891 fee will be refunded. The
city will also open public parking lots for Malonga events and seek to
create a Black Arts Movement and Business District in the area.
“We see this as a
very important first step in creating a cultural equity framework for
Oakland. Bay Development has set a huge precedent here in recognizing
the need for community benefits, investing in public art, and supporting
a cultural institution like the Malonga Casquelourd Center for the
Arts. We hope other developers will follow this example," said Eric Arnold
from the Community Rejuvenation Project and the Oakland Creative
Neighborhoods Coalition, two of the groups involved in the appeal, in a
statement.
"While the lack
of affordable housing on this project remains a concern, we hope city
officials will take leadership to implement impact fees and an
inclusionary housing policy soon so that developers and residents can
have consistent standards,” said Arnold.
At least one
other project will attract similar scrutiny. Community groups previously
told the Business Times that they plan to seek concessions from Wood
Partners' 248-unit proposal across the street at 226 13th St.
This story has been updated to clarify the structure of the art fee.
Roland Li covers real estate and economic development
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