Update 1:05 PM – SF Business Times has more on the land deal aspect, including quotes from Floyd Kephart.
Yes, Raiders and A’s fans alike can start dreaming up their new stadium(s), all shiny and new. A proper team store inside each. There will be chances to compare whatever’s proposed on each proposal’s merits. And there’s a great likelihood that whatever each team proposes pushes the other out of the Coliseum due to scarce land resources and financing difficulties. When those proposals are presented, we’ll have plenty of time to discuss them. It’s entirely speculation at this point, so I don’t want to focus on that yet.
Instead, I want to look at the one less exciting news item that came out of the last couple of days. As Oakland Mayor Libby Schaaf reiterated during her interview with Damon Bruce yesterday, the City of Oakland and Alameda County are finally working together on plans for the Coliseum. Prior to this week, the City had been working on Coliseum City independently of the County, leaving the County to consider working on its own alternatives. They even got to the point of hiring a new general manager for the JPA along with a development consulting firm headed by former City Manager Robert Bobb before backing away. Eventually they decided that the best way forward was to work in concert with the City, since both parties will need to sign off on any future plans.
The biggest obstacle for the City and County is that blasted remaining Coliseum complex debt. At $200 million (split almost evenly between the stadium and arena), it is an albatross threatening the feasibility of any project at the Coliseum. Thankfully, that debt is being whittled away over time by annual payments, so in a few years it’ll be about 25% less. That’s still a heavy load on buildings that may well be demolished as part of any plan, so dealing with the debt in a responsible way is arguably the biggest responsibility for Oakland and Alameda County all told.
The one major asset the City and County have available to them is 120 acres of land, comprised of the Coliseum complex, additionally required property out to Hegenberger, and a smattering of parcels near the BART station. Many are presuming that the land could be swapped for the remaining debt, however much that is when the time comes. That may be a bad presumption, considering the complex’s value as a potential Transit Oriented Development site. Even if you discard 30 acres for new venues, that’s 90 acres to play with, one of the largest TOD sites in the Bay Area (along with Bay Meadows and San Jose Berryessa).
How much is the Coliseum land worth? Located in East Oakland and surrounded by light industrial uses, no one’s going to ask for $7-10 million. What is the the fair market value, though? A listing on Loopnet for nearly 3 acres just north of the complex is asking for $6.75 million, or $2.36 million per acre.
At that rate, the publicly owned 120 acres would be worth $283 million, which would be double the value of the remaining Coliseum debt in a few years. Maybe the JPA uses land sale proceeds for infrastructure, maybe it gets split between the City and County – either way it’s worth more than simply giving away the land to the Raiders or A’s in exchange for paying the debt. One of the owners may even consider those proceeds as a worthy public contribution for a stadium. As the adult conversation continues in earnest, City and County will bring in an appraiser to figure out FMV for that land, find out its revenue generating potential as it gets rezoned, and plan for how to use future revenue streams. It’s a conversation that’s bigger than just keeping teams in town.
If a proposal lowballs land value, as Lew Wolff’s 66th/High (Coliseum North) plan did, selling the land may be considered a nonstarter. If land is the public’s biggest asset and leverage, it hold true to guarding it in the public’s interest. That may lead to discussions in which only parts of the land are sold. In any case, it should be a very lively conversation, one Oakland and Alameda County need to have whether there are two or zero teams in Oakland in a decade.