Category Archives: Coliseum

11.04.14
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Election Day 2014

Update 11/5 6:00 AM – 100% of precincts are in and the ranked choice tabulations have been made. The next Oakland mayor is Libby Schaaf, who effectively trounced her rivals at the polls, nearly doubling Incumbent Mayor Jean Quan’s vote total. After RCV was calculated, Schaaf finished the night with 62.79% of the vote. Runner-up was Rebecca Kaplan. Quan was eliminated in the penultimate round.

Measure BB also won with 69.56% of the vote in Alameda County.

Sam Liccardo held on to win the San Jose mayoral job over Dave Cortese, finishing 51-49.

More commentary to come.

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Update 11:30 PM – Results are coming back with some needed urgency. Schaaf has extended her lead over Jean Quan from 28.45-17.10 to 28.74-16.39, with Rebecca Kaplan now in third place at 14.36%. 44% of precincts have reported so far. Measure BB is now up 69-31. San Jose’s mayoral race has tightened up with Liccardo leading Cortese 50.9-49.1, a difference of 1,500 votes with 45% of precincts reporting.

Update 10:30 PM – The polls have been closed for over two hours, but results have been coming late, the last major update coming at around 9 PM. In Santa Clara County there have been technical (website) issues. Alameda County appears to have similar problems. I’ll hang tight for another hour before calling it a night. So far Libby Schaaf is ahead in the Oakland mayoral race, though be advised that these are extremely early returns and the ranked choice tabulations are not factored in yet.

oakmayor

 

Meanwhile, Alameda County Measure BB is ahead 68-32 and Sam Liccardo leads Dave Cortese 51-49 in the San Jose mayoral race.

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Update 3:30 PM – San Jose City Council voted 9-1 to approve the A’s land option extension. Stand for San Jose’s law firm, Pillsbury, disagreed with the lease option on CEQA and referendum grounds. City attorney John Boyle clarified that a referendum wasn’t needed and that the EIR was certified. CM Pierluigi Oliverio was the lone no vote, saying that if the A’s wanted the land they should just buy it.

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Photo courtesy of Flickr user Dina-Roberts Wakulczyk

Photo courtesy of Flickr user Dina-Roberts Wakulczyk

Despite the general disinterest in today’s general election, there are some important races that will impact stadium efforts for the A’s and Raiders in the Bay Area. Let’s take a look.

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Oakland’s mayoral race is the big one, with 15 candidates including incumbent Jean Quan. A KPIX 5 poll from two weeks ago had council member Rebecca Kaplan first at 19%, fellow CM Libby Schaaf at 17%, and Quan and SF State professor Joe Tuman tied for third at 15%. The Chronicle is reporting that final ballot counts may not happen for a few days, even though they now have the ability to do election night tabulations tonight. In 2010, tabulating the results of the ranked choice vote took the rest of the week to complete. Members of Save Oakland Sports and supporters of Coliseum City have thrown their weight behind Quan, while going against Kaplan, who helped broker the A’s lease extension. Kaplan hasn’t officially stood behind any one concept, though it’s a logical progression to think that she might support a Lew Wolff-offered, A’s-oriented redevelopment plan for the Coliseum. Kaplan had received campaign contributions from Wolff, but chose to return them after questions about impropriety arose. Schaaf and Tuman have been highly critical of the City and the JPA throughout the campaign season, but haven’t offered much in the way of solutions for keeping the pro teams in town. Port commissioner Bryan Parker has remained the most vocal supporter of Howard Terminal for the A’s.

If Quan loses, it’s unclear what happens to Coliseum City. The CEQA/EIR process will continue at least through the 90-day deadline set last month. Kaplan, who had previously considered the Coliseum site the best future place for Oakland sports, remains on the JPA board and could pivot as a “savior” of the plan if she wins. If she doesn’t win she’ll remain in her at-large council seat and on the JPA board. Schaaf is vacating her District 4 seat, so like Quan, if she loses she’ll be out of elected office in Oakland.

As results come in they’ll be posted here. Look for a followup post discussing impacts later tonight or tomorrow.

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San Jose also has a mayoral race, though it is more traditional than Oakland’s RCV. The primary was held in June, and as expected the top two candidates were current council member Sam Liccardo and Santa Clara County Supervisor Dave Cortese. Liccardo is being held up as the successor to Chuck Reed and is expected to carry on Reed’s pro-business policies if elected. Cortese, who was also a council member a decade ago, enjoys a great deal of support from labor and is considered the anti-Reed candidate. Both hold differing views on the baseball-to-San Jose effort. Liccardo prefers to continue Reed’s legal challenge of MLB, whereas Cortese has put forth a more conciliatory approach towards baseball. Both are proponents of bringing the A’s to San Jose.

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Alameda County is set to vote on Measure BB, the 0.5%, 30-year sales tax hike for transportation projects. The tax would fund $7.785 billion in new projects, from more than $2 billion in largely deferred street maintenance to a Livermore BART extension ($400 million) to Bus Rapid Transit in Oakland ($35 million) to $284 million in improvements to I-880. Also in the package is $40 million for Coliseum City, money that would expand and better integrate the transit hub at the Coliseum BART station. This money is considered key to the success of Coliseum City, since additional privately financed development would be catalyzed by the creation of such a transit center. Two years ago a similar measure, Measure B1, barely missed the two-thirds majority needed for passage. Supporters of BB are vowing not to let such a defeat happen again by throwing greater campaign resources and garnering broader support for the measure. In 2012, Coliseum City basically had to punt while it waited for the next election, effectively delaying planning for nearly two years. With so much uncertainty surrounding Coliseum City’s prospects, another defeat could mean a very big nail in its coffin.

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Finally, the City of San Jose’s City Council will vote today on the land option extension on the Diridon ballpark site for the A’s. The option, which is only for part of the fully assembled site, would run at least four years and up to seven at the A’s discretion. The cost of the option is $100,000 for the first four years, with additional years at $25,000. If the A’s exercise the option, they would pay $7 million for those 5 acres, and would have to buy the rest privately. No transaction can happen unless MLB approves a move to San Jose, which it has not done to date.

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Watch the top of this post for updates as they occur.

10.31.14
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Kephart provides some brutal honesty about Coliseum City

New Coliseum City frontman Floyd Kephart provided a wide-ranging interview to the SF Business Times (main article/additional quotes). After 2+ years of the project lacking real details and general cageyness from its spokespeople and supporters, Kephart’s honesty is a breath of fresh air. He minces no words about the difficulties Coliseum City faces, and sets the table for what needs to follow.

birdseye-view_north

Coliseum City with two new venues plus the existing arena

The article, written by Ron Leuty, lays out Kephart’s previous experience, much of it in the horse-racing business, some of which is in financial crisis management. The latter’s probably the best why to describe his current ordeal, with 90 80 days left in the ENA. Kephart admits that CC is by far the biggest project he’s ever worked on. Among the things he says needs to be done:

  • Public benefit analysis
  • Disposition and development agreement
  • At least one signed team
  • Master developer

I put together a more extensive list last week when the ENA extension was signed. The public benefit analysis, while not a requirement, is an excellent idea since it could help garner public support if conducted honestly. That could be crucial if CC ends up going to the ballot box in the future. The DDA is a potential showstopper, since it can take up to a year after a team and developer sign on to hammer it out, as it did for the 49ers and Santa Clara. The DDA isn’t anything like a apartment rental agreement or even a mortgage, it’s hundreds of pages of details about financing, ownership, rights, timelines, and legal responsibilities. Maybe if the Raiders or A’s sign on prior to the end of the 90 days another extension could be granted for the DDA, but it goes to show how far behind the 8-ball this project is.

The big takeaway is that Kephart is meeting with Wolff in early November (perhaps next week?), which will give Kephart a chance to sell Wolff on having a more competent team in place or tailoring the vision for the A’s. Kephart’s aim appears to be lower than what the City was selling for the last two years, as the goal of having one team in place, maybe two is not nearly the same as bold (or pointless) as saying Everyone can stay here, there’s plenty of land.

Wolff could easily dismiss the plans just as he had done over the summer, but with the finish line drawing near, Wolff may be more likely to listen. The reason? Process. Having an active CEQA/EIR process underway is worth millions of dollars and at least a year’s worth of effort, so if Wolff were to sign on or bring in a master developer that will work in concert with the A’s, they’d already be ahead of the game. It’s a risk for Oakland, though, since the Mark Davis could view this as a sign that the Raiders are about to be marginalized. Since Davis hasn’t signed on himself, there isn’t much room for him to complain. As Kephart notes:

“Nothing says what the Raiders want. Is it a life-sized statue of Al Davis at the entrance of the stadium and then they’ll stay? … Maybe the teams have asked the city that — I don’t know.”

Another big piece of news is the timeline.

Yet even if Kephart’s group assembles all the agreements and documentation needed to win over a master developer for Coliseum City, the soonest the A’s would play in a new ballpark would be 2018 and the Oakland Raiders would land a new stadium in 2019 ‘at the earliest,’ Kephart said.

‘We want to cooperate,’ Wolff said. ‘We want to see what happens in whatever timeframe, 90 days or longer. Then we’ll know better what we have to do.’

2019 for the Raiders is a long ways away. It’s unclear whether that would be acceptable for Davis. If someone’s promising a new stadium in LA earlier, he may be willing to take it if the terms are right, even if he’s the second team in LA. 2018 for the A’s pretty much falls in line with reset expectations coming out of the lengthy Coliseum lease negotiations. We all want it sooner, I know.

For now Kephart is saying the right things – the truth – that can help get everyone on the same page. There’s no doubt that the effort at this point is a Hail Mary. Then again, Kephart probably knows a thing or two about long shots. If his work can help get the A’s in a ballpark in Oakland, he’ll have done his job magnificently.

10.30.14
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Non-recap of the Oakland Sports Forum

Technical difficulties resulted in me (and others) getting only bits and pieces of the Oakland Sports Forum livestream, which at times suffered from dropped audio and the stream cutting out altogether. Streaming an event while trying to run it is extremely difficult, so try as Zennie Abraham did, it didn’t work out well. Thankfully the forum was archived on Ustream so we can all view it after the fact, though the audio quality remains poor.

At this point late at night I don’t think I can give a proper writeup, so I won’t do that. If I can get the full picture after rewatching in the morning I’ll give it a shot. Instead I’ll drop in a few tweets from last night. Hopefully that’ll give you a sense of discussion.

https://twitter.com/muppet151/status/527642880588787713

https://twitter.com/muppet151/status/527651433370247168

https://twitter.com/muppet151/status/527654119826128896

Rebecca Kaplan and Jean Quan spent a good amount of time pitching themselves as the best possible saviors for the Raiders. Quan plugged the progress on Coliseum City (such as it is), while Kaplan sold herself as a more conciliatory negotiator that wouldn’t damage the relationships between the City and the teams. Joe Tuman had a lecturing moment when he dismissed these mini stump speeches as pure election politics with little to come at the end. Bryan Parker cast himself as an out-of-the-box thinker, though his example of Stanford Stadium seemed a little off the mark. Libby Schaaf, who until recently hasn’t spoken that much about the pro sports teams at all, seemed against the idea of the City buying out Alameda County in order to advance Coliseum City.

Those who attended may have learned a little more about the candidates and their relative stances on pro sports. Ultimately, I don’t know that it will affect the actual vote all the much, as we’re 5 days from the election and whatever messages could be gleaned from this event probably won’t permeate the voting public to any significant degree. That said, it was still a good idea for Zennie Abraham to put on the event (pity it happened opposite Game 7). It may not have been the sequel to The Adult Conversation we were looking for, but there were signs. I suppose that discussion will come in early December.

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P.S. – Big thanks to Bryan Cauwels, who tried valiantly to help Zennie fix the stream problems. Bryan is part of Save Oakland Sports and is a good representative for their cause. We may not agree on the future of sports in Oakland, but we always have good, civil discussions about it, probably because Bryan is one of the nicest guys on the planet (I am not).

10.27.14
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Oakland Sports Forum, Wednesday October 29, 6-8 PM

Oakland has had a slew of mayoral candidate forums and debates, all leading up to the election on November 4. Surprisingly, there has been little coverage of the sports franchises and their impacts, save for the occasional easy-to-dodge question here and there. Thankfully, Zennie Abraham has seen fit to host his own forum. Named the Oakland Sports Forum, the event will be held this Wednesday, October 29, from 6 to 8 PM at Lakeshore Baptist Church in Oakland.

Abraham, who does a lot of video in addition to blogging, will be livestreaming the forum on YouTube as well. If there’s a Game 7, you may have to multitask.

A set of four questions will be posed to mayoral candidates who show up. So far 12 of the 15 have confirmed. Here are the questions:

  1. Wild card question from audience submitted beforehand, asked by that person. (1 min per candidate, then 10 minute conversation period with moderators.)
  2. The Golden State Warriors are working to build an arena in San Francisco. Some say the deal is done and its too late to stop it. But others say that the Warriors belong here in Oakland, still owe Oakland and Alameda County rent that would pay off the bond that was issued to pay for arena renovation in 1998, and should not be allowed to skip town. What is your take? (1 min per candidate, then 10 minute conversation period with moderators.)
  3. The Oakland Raiders and the Oakland A’s need new stadiums. As I speak, Coliseum City is in the early planning stages, but could progress better – financing has not been completely secured. Is Coliseum City the right approach, and if it’s not, then what would you push for as Mayor? The ballpark waterfront proposal? (1 min per candidate, then 10 minute conversation period with moderators.)
  4. The Oakland / Alameda County Joint Powers Authority was formed to provide a government issuing body for the Raider Bonds. Lately, the JPA has been the focus of strained City and County relationships, and I’m presenting that in an open-ended fashion. What, if anything, should be done with the JPA, and as Mayor what will you do to make that happen? (1 min per candidate, then 10 minute conversation period with moderators.)

It’s a good set of questions which should keep the candidates from being too vague in their responses. The responses will be scored – how very sports – and a winner will be announced at the end of the proceedings.

It’s been eight years sense the “Choose or Lose” forum prior to the 2006 election. This shapes up to be a more substantive event than the last one. Maybe there will even be an adult conversation.

10.22.14
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90 Days Or Bust

The last post had some fortuitous timing, as a breaking Chronicle item came in just as I was about to hit publish. That was followed by articles in the Tribune and SF Business Times, so read those to get the full (for now) scoop.

In short, the City Council voted 6-1 to approve a 90-day extension. That’s a marked departure from the 6 months that was previously expected. Motivation for moving up the deadline is unclear. It could be confidence on the new investor group’s part. It could be the need for Oakland to show something before the February NFL relocation window opens, which only a 90-day timeline would accomplish. Perhaps it’s a little of both. In any case the City of Oakland and the new working group, New City Development LLC, will have until MLK Day to prove itself.

Raised park concourse that runs through Coliseum City

Raised park concourse that runs through Coliseum City

New City will be headed by Floyd Kephart of Renaissance Companies in San Diego. Renaissance is a consulting and advisory firm. Kephart’s main task will be to bring in the remaining money required to bridge the funding gap. He’s also responsible for signing up a master developer to oversee the entire 800 acre project. There are only a handful of companies that have experience doing projects of this size and scope. Forest City was expected to be the master developer originally, but they backed out when they saw the costs and potential returns. Miami Dolphins owner Stephen Ross runs Related Companies, another experienced firm for such work. Related is heading up the massive, $6.5 billion development north of Levi’s Stadium in Santa Clara. What does Kephart see that Forest City didn’t? We should soon find out.

The lone dissenting vote was CM Rebecca Kaplan, who pointed out that several deliverables are still missing, including the deal terms and financing model. Both of those items were expected over the summer, and when BayIG was pressed for them, were promised again in August (and apparently not delivered). Kaplan’s ties to the A’s extension and Lew Wolff’s recently returned campaign contributions make her moves somewhat suspect, but lack of follow-through on BayIG’s part is rather disappointing and unsettling when you consider the lead time they had to assemble the deliverables.

A big surprise to come out of the session was CM Larry Reid’s complete 180 on the project. He has been a fervent critic of the plan for at least a year now, and his effusive praise of Kephart is quite startling. That said, the project is in his district, so he stands to benefit if it comes through. He’s also not up for reelection this year, so he doesn’t have to back either Kaplan’s or Mayor Jean Quan’s visions. Reid remains Vice Chair of the Coliseum JPA Board.

Three months is an awfully short time to get the deal done. It’s not a matter of tying up loose ends. There are major deal points that have to be addressed.

  • Sign at least one tenant, preferably the Raiders to start
  • Engage the A’s and Warriors (even though neither team is interested)
  • Provide deliverables and reports that haven’t been completed yet (deal terms, financing, 2nd phase market analysis)
  • Bring in a master developer
  • Line up needed capital for stadium phase and ancillary development phases
  • Figure out who pays for the remaining debt at the Coliseum and Arena (if necessary)
  • Gather support of the JPA and Alameda County

It all feels like it’s going to get severely rushed, which could end in a horrendously bad deal for Oakland if they’re not careful. Quan’s calling the announcement a victory, though she neglected to mention that she said several times throughout the year that a team – the Raiders – would be a signed partner, at first during the summer, then late summer, then fall. Problem with trying to sign the Raiders is that because of the lack of concrete information on financing, investors, and viability, there’s no reason for the Raiders to sign on, and national reports echo that. Every time someone in Oakland talks up how the Raiders are getting ready to officially be a part of this, Mark Davis knocks that notion down. With the season almost half over and the NFL’s relocation window looming in February, there’s no reason for Davis to commit to anything before he feels it’s the right moment. The best deal for Davis comes with having the most options open, and that includes Oakland, Los Angeles, and maybe even San Antonio. He at least has limited leverage in that scenario. As for the the A’s, Lew Wolff is standing as far away from this as humanly possible, not wanting to make it anymore complicated, and not wanting to draw the short straw.

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The JPA is busy getting ready for life after the Coliseum too. Last week they were ready to hire Republican Guy Houston, but the vote on his hire was delayed amidst renewed scrutiny into legal issues Houston had while in the State Assembly. The JPA did make a hire on Tuesday and his name will be familiar: former Oakland City Manager Robert Bobb. Bobb’s consulting firm is consulting the JPA on stadium and other development at the Coliseum, whether it’s Coliseum City or a Wolff-developed alternative. The cost to the JPA? $25,000 a month. Check out this org chart showing Bobb, Houston (or someone else), and the JPA.

Org chart supplied by The Robert Bobb Group

Org chart supplied by The Robert Bobb Group

The JPA doesn’t have the power to make any planning or zoning decisions. Only the City does. The County is co-owner of some of the land and could provide resources, so it also has a say in whatever happens. All I can say is that when you look at the above chart and all the different parties involved in Coliseum City, it’s a lot of cooks for one kitchen.

10.21.14
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Coliseum City ENA likely to be extended at closed session

Update 5:30 PM – Looks like this turned into a nice pre-election announcement for Mayor Quan.

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Original post:

Today’s the “big” deadline day for Coliseum City. Or maybe not. Consider the following closed session agenda item, to be taken up this afternoon:

b) Property: Coliseum City properties (various properties bounded by San Leandro Street, 66th Avenue, Edgewater and Helgenberger)

City Negotiators: Fred Blackwell, Gregory Hunter, Larry Gallegos, Daniel Rossi

Negotiating Parties: Bay Investment Group, JRDV Architects Inc., HKS Architects, Inc.

Under Negotiation: Price and terms for disposition of the property

Not much to go on, is there? We know that the deadline is there thanks to previous documents about Coliseum City which specified 10/21:

ENA Timeframe: The Negotiation Period under the ENA is hereby extended to run until October 21, 2014, and may only be extended an additional six months with administrative approval.

October 21 also marks the 360-day point of consideration of the project, during which BayIG was supposed to provide a set of deliverables. A quick recap of some of the major deal points:

  • Tenant sign-on from one, two, or three current sports franchise tenants (Raiders, A’s, Warriors) – None so far
  • Market Data Analysis – The lengthier second part was supposed to have been released by now, has not been made publicly available
  • Infrastructure Study – Completed
  • Investor Business Case – Reportedly late, not publicly released

Last week there was news that a new, previously unknown investor may come in to save the project. Word was that it would be Perry Capital – a hedge fund with two recent executives who have a minority share of the Raiders – they and the City are going to great pains to keep their involvement under wraps until/unless the ENA is extended. Now Matier and Ross report something different:

Council members privately told us they were encouraged by the team’s 11th-hour addition of new deep-pocket investors being represented by San Diego asset manager adviser Floyd Kephart, chairman of the board of Renaissance Cos. Kephart is expected to take the lead role in the newly reconstituted group, New City Development LLC.

So goodbye BayIG, hello New City Development LLC? Okay.

Also last week, we saw a new website promoting the project, Coliseum City Now. I looked into it and found out that the domain was only acquired on September 26. A companion Facebook page started up during the summer. Assuming that both are under the purview of BayIG/JRDV, the timing seems a little suspect. Coliseum City never bothered to have an website outside of the City’s project page for a year. Why have one now? There’s also a Twitter feed, which has never made a post and has less than 20 followers. Chances of a post coming after 5 PM today? Excellent.

birdseye-view_north

Coliseum City in full buildout

In anticipation of the extension, some unnamed City officials reached out to Raiders fans to make a show of support at the open session at 5, during which the decision is expected to be announced. Keep in mind that it’s basically up to the City Administrator, not the City Council. Also understand that not extending the deadline would effectively kill the project, giving Mark Davis every excuse to go to Los Angeles. What other choice does Oakland have?

If the City announces the ENA extension and the new investor, the mountain to climb for them will be steeper that the Mt. Davis upper deck. They’ll need to wrap up the basic terms of the deal, have the Raiders sign on before they decide to move, and start work with the JPA and Alameda County to put together the DDA (Disposition and Development Agreement), which would allow the project to move forward in earnest, in whatever form it takes. In reality, Coliseum City has 4 months to work out the details, not 6.

On a related note, the comments period for the Draft EIR expired on Friday, October 17. The City will take all the comments and get questions answered from stakeholders and other groups that need to provide answers (Caltrans, PG&E, and the PUC for starters). The EIR runs on a separate track from the business side of the deal, though both need to be resolved/approved before any dirt can be turned.

As for the news impact on the A’s – as I’ve said for some time, the funding gap ($600 million) makes the inclusion of a ballpark extraordinarily difficult to pull off in a way that would satisfy both the baseball team, the public sector, and the private investors who are looking for a healthy return. Moving to more far-off forms of financing makes the likelihood of a ballpark even less.

I’ll be checking into the live stream of the open session while watching the World Series. The mix of tweets promises to be entertaining and at times quite confusing.

10.14.14
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Kaplan returns Wolff campaign donations; Coliseum City courts hedge fund

Last week the Trib’s Matthew Artz asked Oakland City Council member and mayoral candidate Rebecca Kaplan about $2,100 in donations that came from Lew Wolff, his wife and daughter. There was a suggestion of impropriety, as an Oakland law prohibits campaign contributions from any party that has done contract negotiations with the City during the prior six months. After huddling with her staff over the legality of the donations, Kaplan decided to return the checks. Wolff appeared to be unaware of the law. You may remember that Wolff donated a much more eye popping sum of $25,000 to a committee backing Don Perata’s mayoral campaign during the 2010 election, a move that may have helped cost Perata the election. Perata admitted that he wasn’t going to waste time or money trying to keep the A’s in town.

That’s a much different stance than Kaplan today, as she has staked a claim to helping save the A’s by spearheading lease extension talks. Kaplan has also supported Coliseum City, though the project is considered Mayor Jean Quan’s baby, at least politically. The now returned donations are under investigation by the California Fair Political Practices Commission, as is another $1,000 that was donated to a Kaplan committee whose fund has been liquidated under similar concerns.

Kaplan has been the frontrunner in recent polls, beating Quan in a projected ranked choice voting scenario. It’s unclear what damage the donation investigation could cause the Kaplan campaign, which is only three weeks from the election.

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Matier and Ross reported over the weekend that Coliseum City is getting cozy with yet a hedge fund to potentially finance the project. The SF Business Times revealed that the target is Perry Capital, a fund managed by Paul Leff and Dan Golding. They purchased a non-voting, minority share (20%) of the Raiders for $150 million from Al Davis before his death. The fact that Perry already owns a share of the team gives the story more credence than previous stories about the Crown Prince of Dubai. Then again, let’s keep in mind the rather unimpressive amount of financial support for the project so far:

Forest City backed out because they didn’t see the numbers working out. Colony/HayaH has purportedly been hesitant to fully commit for similar reasons. The Dubai story was just that, a story, and Perry Capital? Well, at least there’s an existing relationship there. There’s a $500-600 million funding gap that needs to be addressed. If Perry is going to assume a large percentage, they’ll want their pound of flesh in return. That could mean a larger slice of the team, though Mark Davis is reluctant to drop below a controlling percentage, which in the NFL has been 30% for a family and 10% for a controlling partner in that family. Davis and his mother own 50-51%, so there’s some room to drop. The NFL may also be looking to lower the requirements for legacy family ownerships.

It’s hard to judge based on the limited information we have, but we can assume that trading in a share of the team for a private stadium subsidy (to be paid back by a rise in team equity and development revenues) is an option available in both Oakland and Los Angeles, and perhaps in San Antonio as well. Leff and Golding have seen their investment appeciate 29% since their 2007 purchase, which seems impressive enough except when compared to the skyrocketing values of many other NFL teams. The Raiders for now are a low revenue team in a low value market, with the only obvious recourse being the construction and selling out of a new stadium. Leff and Golding could push hard and try to bring in even more partners to spread out the risk. The problem is that Coliseum City is clearly a long game, with significant profits going to pay for the stadium and ancillary development. Rental and real estate sales revenue are the prize that will take years to materialize.

The struggle to attain financing for Coliseum City highlights how different Coliseum City is from other NFL stadium development plans. The NFL and the Raiders at first wanted to focus on the stadium, with further development coming down the line and not necessarily tied to stadium loans or bonds. The league has a very sophisticated financing structure in place. It gauges the size of the stadium project, assesses the ability of the applicant team to pay for its share, and doles out loans from its G-4 program. The league also plays matchmaker, hooking team owners up with huge financial institutions like Goldman Sachs and BofA. Those banks are there to manage that funding gap, the same kind that Coliseum City is trying to fill for the Raiders. When Oakland decided to move in their own direction, the NFL decided to play wait-and-see with the project. If JRDV and the other CC principals can pull it together, the NFL can give the project its blessing and untie the G-4 purse strings. If not, Oakland’s future will look very bleak on the Raiders front. It makes one wonder why they’re going to so much trouble when there is a tried-and-true method to financing a new NFL stadium. It limits the number of potential partners in favor of a high-risk strategy with a low chance of success. And if they’re having to resort to working with a hedge fund, the usual avenues for funding may all be exhausted.

There is some historical symmetry to this effort, as the original Oakland-Alameda County Coliseum Complex was privately financed after Bob Nahas and others went to some far-flung places to secure that funding. The ENA deadline is October 21, and news of a new partner may allow Oakland to extend the period six months, though such a transparent move isn’t likely to gain Mark Davis’s support. The development team has spent three years and $5 million on Coliseum City. What do they have to show for it? So far, not much beyond the 3,500 pages in the EIR.

10.02.14
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Tweets and commentary from 10/1 Oakland Planning Commission meeting

The public came out of the Planning Commission meeting with more questions than answers, and that’s a good thing. When the EIR comment period ends, it’s up to City staff and consultants to provide answers to the many question posed by the public.

A presentation was given to start. Early discussion focused on affordable housing as part of the plan. The plan calls for 5,750 housing units to be built. 25% of those are supposed to be affordable, whether via rental or purchase. The Bay Area’s ever-skyrocketing housing market makes that 25% a growing subsidy (public and/or private) with each passing month. According to trulia, the median price for a home in Oakland is $475,000, up 8% from September 2013. Oakland uses a HUD formula to calculate affordable housing on a regional basis. In essence, 25% of housing would have to be affordable for households making $72,000 or less per year. However, the median income in Oakland is less than $52,000/year. To make it work, the City and developers would have to crunch some serious numbers to determine the proper mix of pricing and subsidies, not to mention addressing low income residents and senior citizens – both groups represented by commenters at the meeting. Chances are that most of it would come out of developers’ pockets, though Governor (and former Oakland mayor) Jerry Brown has been working to get rid of affordable housing set-asides. This puzzle has to be solved by all residential developers in California, so it would affect Coliseum City’s principals or Lew Wolff and partners if they were given the opportunity. One East Oakland resident got straight to the point.

As the Commissioners took their turns picking apart the plan, one asked about the status of discussions with other parties that need to be involved. The responses?

That third tweet is interesting. We haven’t covered the bay inlet much. That’s a reference to the new part of the bay that would approach the new arena (assuming the Warriors stay at Coliseum City).

Inlet at top

Inlet at top

You might think that the inlet was designed for a ferry terminal or for boats with a dock. You would be incorrect. It’s merely a shallow extension of the estuary, a tidal mudflat not meant for recreation. It’s meant to provide an additional habitat to go with all of the new construction, but it seems like a wasted opportunity. Of course, providing a ferry terminal would bring about an even greater environmental review since some dredging would be required. A couple commissioners seized on the fact that of the various development options the no-build alternative was barely touched except to say that the various venues would be demolished and other development would fill in at some point. Since this is a Specific Plan and not just a small project-level EIR, it’s within the Planning Commission’s right to ask about what happens if the teams leave, since it’s a distinct possibility. The scenario should be addressed in more detail in the final EIR.

A few Raiders fans showed up to provide their support, including Dr. Death and Godfather Grizz. They were largely outnumbered by local residents who expressed concerns about the aforementioned housing problem, gentrification, the need for improved police and fire services in the area, and questions about the effects Coliseum City could have on the rest of Oakland. One thing I’m surprised to not hear was a question about what impact a second downtown (which is what CC represents) would have on the current downtown/uptown area. While that’s a question that goes broader than the existing project, it’s well within the Planning Commission’s purview to take on that kind of dilemma – if it’s a dilemma at all.

Coliseum employees who want to see their jobs protected were well represented. One resident noticed the streetcar that runs through the complex and wanted to see it expand all the way out through East Oakland and up International Blvd. If a streetcar is going to be put in at all, that’s the way to do it. A commissioner noted that while BART and the new AirBART are getting a lot of attention, very little is being paid to how AC Transit and Amtrak will be integrated. AC Transit is as important as anything, because while buses aren’t sexy, they will be responsible for providing transit for many of the low-wage workers that will be working at the hotels in the plan, especially at odd hours.

Overall, there was a large undercurrent of sentiment that Coliseum City is being conceived as an island, not well integrated with East Oakland. That itself is a dilemma, because developers don’t want their shiny condos associated with East Oakland’s rep while community groups and residents are desperately hungry for the opportunities the project represents. As part of Mayor Jean Quan’s 10K-2 plan, Coliseum City represents a big piece of a goal she’s trying to reach.

The Coliseum area had lost a few hundred jobs over the decade from 2000-10. Now it’s being counted on to retain three sports franchises – two of whom have no interest in the plan, along with around 4,000 new jobs throughout the 800-acre development. Developers tend to make big promises about such economic growth which get lost in market realities. Perhaps it’s time for more scrutiny of these estimates.

10.01.14
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Oakland Planning Commission meeting (October 1st, 6 PM)

Tonight’s monthly meeting of the Oakland Planning Commission may be of interest to you, since the third item on the agenda is Coliseum City. Some relevant links:

This session comes on the heels of Coliseum City presentations made for the JPA Board and Port of Oakland’s Board last week. I’ll live tweet when the item comes up for discussion and do the wrap-up in this post after they’re done. Apparently there will be numerous Raiders fans there in support of the project. If you’re interested in the subject, I suggest watching.

09.29.14
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Former Assemblyman & Dublin Mayor Guy Houston in running for JPA Exec Director position

Rumors bubbled up last week on the inter webs about the Coliseum JPA potentially filling its vacant Executive Director position. BANG has reported further on it, lending the story credence. The leading (only?) candidate is Guy Houston, a Republican lobbyist who spent 6 years in the Assembly. Prior to that he was the mayor of Dublin.

Guy Houston

Deena McClain has been the Authority’s Interim Executive Director for some time, also serving as legal counsel. During the lease discussions over the summer, you may remember that she was the point person for any and all questions about the current lease terms, outstanding debt, and operations of the Coliseum complex. McClain, in concert with outside counsel, negotiated the A’s lease on the JPA’s side. That would be Houston’s role should he take the job.

Should the Raiders elect to stay in Oakland for however many additional years, Houston’s first task would be to negotiate that lease extension. Beyond that, he’d have to lead talks for the future of the complex, whether it’s Coliseum City or a successor plan. The position has been vacant for so long that it’s easy to forget its importance. Take a look this excerpt from the still-relevant-albeit-outdated job description:

The ideal candidate will:

  • Be a strong and visible leader;
  • Have very strong analytical and problem solving skills;
  • Be able to evaluate, analyze and interpret complex financial statements and reports;
  • Be able to develop, present and defend financial reports/profit loss statements;
  • Have excellent communication abilities both orally and in written form;
  • Be able to draft, interpret, negotiate and apply complex contract language;
  • Have strong facilitation and mediation skills;
  • Be a consensus builder;
  • Understand the political process and public meeting dynamics and requirements;
  • Identify and present the best business decisions and practices in a political environment;
  • Understand sports franchise businesses and the dynamics of their operation;
  • Understand comparable stadium/arena/entertainment facility operations;
  • Will know or be able to learn the market and the best practices;
  • Be able to build and maintain a good organizational public image;
  • Develop and maintain positive media relations.

Before any of you start emailing your resumes, there are also some specific requirements for the job:

MINIMUM REQUIREMENTS

  • A degree in business administration, public administration, economics, or another closely related field. An advanced degree is desirable.
  • Experience managing a similar revenue generating enterprise owned by a public entity or managing a facility comparable to the Coliseum Complex.
  • Experience demonstrating successful application of the abilities and traits of “The Ideal Candidate”.

If you’re still in college, or you work some midlevel position in the private sector, you need not apply.

Having served in the public sphere for well over a decade, Houston’s certainly qualified. The real questions are about his station within the JPA and his designs on the job. Houston was termed out of his Assembly District 15 job in 2008. He then ran for Contra Costa County Supervisor and lost, then went for the GOP chair job and lost. Since then he’s been a lobbyist, continuing to work out of Dublin. If he wanted to get back into elected office at some point, successfully negotiating new deals as the JPA’s Executive Director would be an excellent feather in his cap, though it’s unclear what elected offices he could capably shoot for as a Republican in Alameda County.

Houston’s reputation is very pro-business, developer-friendly. In the mid-2000’s he was caught up in a scandal involving his father, Fred Houston, who was accused defrauding senior citizens to the tune of $340,000. Fred Houston was also the longtime head coach of San Ramon Valley High’s football program. Zennie Abraham noted Guy Houston’s close ties to Alameda County Supervisor Scott Haggerty, who is also known as very pro-business.

The Executive Director serves at the behest of the JPA Board of Commissioners, so it’s not as if he/she can create an agenda and start dictating terms. However, the ED could certainly steer negotiations one way or another, based on ongoing evaluations of potential deals. As divided as the JPA has shown itself to be over the future of the Coliseum, it’ll be more important than anything for the ED to build consensus. Should Houston get the job, it’ll be no small feat if he gets everyone rowing in one direction.