Matier and Ross reported today that the City of Oakland and BayIG, the group behind the Coliseum City project, have put together the “basics” of a deal that would include a ~$1 Billion stadium for the Raiders and development of up to 800 acres surrounding the stadium.
Now, Zach Wasserman, an attorney representing backers of a hoped-for sports, housing and retail complex called Coliseum City, says the “basic terms” of a financial deal have been worked out among his group, the city’s negotiators and the Raiders.
The big takeaway is that the City and County, which would be giving up land and paying for infrastructure costs as part of any deal, would also have to pay off the remaining $120 million in Coliseum debt. That is an enormous giveaway on Oakland’s part no matter how you slice it. Both City and County officials have insisted in the past that any large plan like Coliseum required the debt to be taken care of – preferably by the developers. If you can remember back to the “adult conversation” in December, County Supervisor Keith Carson practically hijacked the proceedings by having the first 10-15 minutes of the meeting spent on recounting the debt liability faced by the JPA.
Carson emphasized that there will be no future project if debt isn’t addressed first.
So, let’s tally up what we know are the costs of Coliseum City so far:
- $344-425 million in infrastructure cost
- $120 million in Coliseum debt
That’s up to $565 million in project costs, all without building a single stadium, hotel, or office building. And there’s more. Not included is the $80 million in arena debt, the responsibility for which is up in the air. In the EIR (you guys have been reading that, right?), the City states that of the 800 acres covering the entirety of the project, 535 are publicly owned. That includes the City, County, JPA, and EBMUD. The remaining 265 acres are privately owned, making those properties subject to negotiation. Most of that land is on the west side of 880, but some important pieces are right next to the Coliseum or in between the Coliseum and the BART station. Now let’s take a low market rate offer of $2 million per acre. That’s another $530 million that would be borne probably by developers, but could also be paid to some degree by the City since Oakland has eminent domain capability. No matter who pays for it, the total cost of land, infrastructure, and dealing with outstanding debt is $1.1 Billion. That’s the cost of the Raiders stadium right there, or two A’s ballparks.
The counter is that the Raiders, NFL, and BayIG are paying for the football stadium, which may or may not have a retractable roof, may have 56,000 or 68,000 seats, etc. The potential upside is 10,000 new residents, 21,000 jobs, and retaining all of the teams – though it still hasn’t been articulated how any sort of carveout for the A’s would work.
Now compare that to what Lew Wolff is offering, which is to pay off the debt on both the Coliseum and the Arena. While we haven’t seen plans, the planned development is not expected to be as expansive as Coliseum City, as Wolff has said that acquiring private property for this purpose is a bit sticky for his liking (Coliseum North being Exhibit A). Besides, even 120 or 200 acres is a lot of land.
We haven’t yet heard Alameda County’s side, and Carson is certain to raise questions about the giveaway. The City can come to terms on a deal, but without the County as a partner the deal isn’t sealed. I fully expect a sequel to the adult conversation, when all of the costs and liabilities are laid bare. If the A’s get it together in time, there may even be a sort of competitive situation with two bidders. Let the rich guys duke it out over what is purported to be high quality, valuable land. Chances are that such a discussion won’t happen until after the election. After all, there’s something fishy about the timing of this release, considering that last week Oakland mayoral candidate and CM Rebecca Kaplan took credit for “saving the A’s in Oakland” (h/t Zennie Abraham).