A China-based investor has agreed to help pay for a $1.5 billion development in Oakland to transform 65 acres of industrial waterfront adjacent to Jack London Square to a district of shops, parkland and homes featuring high-rises that will reshape the city’s skyline.
The Brooklyn Basin deal, announced Wednesday by Gov. Jerry Brown in Beijing during his trade mission, will create 10,000 short- and long-term jobs, 3,100 housing units, 200,000 square feet of retail and commercial space, and 30 acres of parks that include wetlands restoration.
The project, described by city officials as “shovel ready,” already has city approval and a certified environmental impact report, and groundbreaking is expected next year. Plans began 12 years ago when Brown was Oakland’s mayor, but stalled because of lack of financing.
Brown credited Oakland Mayor Jean Quan as being “instrumental” in connecting the China-based investor, Zarsion Holdings Group, with the Oakland-based developer of the property, Signature Development Group.
The governor is in China to open a California trade and investment office and to create a task force to increase investment and trade between the state and China. The news about Brooklyn Basin was the first major announcement of his trip.
“This massive influx of Chinese investment will put thousands of Californians to work and dramatically improve Oakland’s waterfront,” Brown, a longtime Oakland resident, said in a statement. “This project is just one example of what’s possible when business leaders in two of the world’s most dynamic regions connect.”
The property is south of Jack London Square and west of Interstate 880 – an eyesore that includes a former shipping terminal, storage facilities, and a sand and gravel business. As plans for the development, formerly known as “Oak to Ninth,” languished, Signature offered the site as a possible home for the Lawrence Berkeley Lab – which chose to build in Richmond. The city, meanwhile, proposed building a baseball stadium for the Athletics nearby.
Signature had been shopping the site to various investors when Quan introduced the two groups around the beginning of the year, said Paul Nieto, a senior vice president at Signature. Quan has known one of the investor team’s members, Peking University Professor Bruce Quan, since the two were at UC Berkeley. They are not related.
On Tuesday, they had a signed agreement, though the terms were not disclosed. Nieto would only say that Zarsion’s contribution was “substantial” enough to warrant them being “co-developers.”
In the first of the project’s four phases, which involves building 1,300 housing units, Zarsion will contribute $28 million, Nieto said. Construction next year will mostly create infrastructure, including roads, electricity, sewer and water lines, and other services. The first buildings will go up in 2015. How quickly the project will be built will be determined by the market, Nieto said, but he estimated it will be complete by 2021.
Once finished, trails will tie the parks to the Bay Trail as well as Lake Merritt. The developer has also signed agreements with the city about local jobs, 465 affordable housing units, apprenticeships and other community benefits.
David Kakishiba, who fought for the community benefits as the executive director of the East Bay Asian Youth Center, said he believes the project will be a boon to the surrounding neighborhood and the city as a whole.
“It’s a pleasant surprise to hear this,” said Kakishiba, who is also president of the Oakland school board. “We weren’t sure this project would ever happen because of the state of the economy.”
Not all Oaklanders were happy to hear about the deal.
Naomi Schiff, an Oakland Heritage Alliance board member, derided Brooklyn Basin as “a suburban project on the edge of the city with not very good access connecting it to schools, stores and the rest of the world.”
The major waterfront development is one of several planned in the Bay Area. Lennar Corp. is planning to build 10,500 homes on 700-plus acres in San Francisco’s Hunters Point. The developer has also been looking for Chinese investment to back the project.
Quan said she has made many introductions to Chinese investors since becoming mayor. The introduction to Bruce Quan, a childhood friend of her husband, Floyd Huen, was just the first to bear fruit.
“Trust me,” she said. “There will be other deals.”
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