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November 18, 2007

Very Likely the Main Cause...

..of global climate change is human activity, particularly the burning of fossil fuels such as oil and coal.  So says the IPCC's summary, published last Saturday.

Well, we can't exactly build our way out of it, but how we build, and where we build will have a lot to do with the changes afoot.  The built environment can be a significant part of the solution--one of the largest opportunities embedded within the climate change crisis.

The IPCC Fourth Assessment Report is out.  Rising temperatures, rising sea levels [the area in light blue is what is likely to be under water in the Bay Area], and long term changes already well underway are described within the report.

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We need a new way of valuing what we develop, and where.  The good news is that, after transportation, changes in our built environment have the greatest mitigation potential on climate change.

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Where do you start?  Ask yourself if you are building the right thing in the right place.  Ask yourself if you are building it to thrive in a high cost energy world.  And start being the change...

November 5, 2007

SWL 337

The Port recently put this 600,000SF property out for RFQ/RFP on a 75 year groundlease basis.  Curbed and Socketsite are abuzz with opinion about what this site wants to be--

image

The port needs $1B to cover the gap in its operating and cap exp budgets, and it is using the ground lease of this site as a way to cover a significant part of this shortfall. 

The Port is counting on $8 to $10M in rent, which translates into about $250 PSF in residual value. My guess is you need an FAR of about 3 to make this work.  From the Mission Bay Standards, this looks achievable.

image Opportunities/Constraints?

  • LEED Gold or better.
  • 2.57 acre China Basin Park to be developed as part of the plan.
  • No height restriction.
  • residential allowed as a potential use--unique for a waterfront location.
  • close to UCSF Med Center
  • Bayfront location.
  • Replace all infrastructure, including Terry Francois boulevard.
  • classic path of development play.

The math:

About 1.2MSF of buildable, at $750PSF TDC means this is a ~$1B total build out. 

Uses? 

Hotel--long term obviously, although this is a remote location for the next ten years.  There is a 500 room hotel use permitted across Third Street from this site. ADR hasn't accelerated to the point where you are seeing much new product.

Destination--some interesting options, but how much ground rent can be paid?

Office--subject to Prop M, and the Hines/Pelli Transbay project has the potential to tie up all the City's office space entitlements for roughly ten years.

Retail--the old "half a trade area" problem, the other half of the trade area being residents of San Francisco Bay and not huge shoppers.

Condos--the late saviour of the commercial construction market is oversupplied right now.  There are several condo sites being quietly offered, and no takers.  The fact that this site is groundleased means that condos are not a real option.

Rental housing--obvious use, but can it pay $100K/door?  You need $6 PSF rents to do that.  You have a few units on Craigslist pushing $5, so this is probably a 4 cap on trended rents.

The site used to be the old H&H Ship Service Company's tank farm, so you don't want to excavate much at all.  The Giants want 2000 spaces of ballpark parking--actually not much for a major league park.

Chase costs will be significant--any deal requires approval by the State Lands commission, and amendments by BCDC, but this is a marquee site in one of the world's greatest cities.

Oh ye gods, why do you tempt me so?

May 19, 2007

A $400,000,000 Bargaining Chip...

or a failure to plan and develop?

The numbers show that it is a bad idea to continue this current use.  How bad?

 

The numbers?

  • 768 cells
  • 301,200 SF
  • $1100PSF cost.

Approximately $15 million has been spent to plan and cost out this project.

The asset is 432 acres of southern exposure waterfront in one of the most beautiful spots in the world.  See the problem here?   The site is worth $400 Million with a transit village use permitted on it[.pdf].  A comparable site in Susanville, Chowchilla, or the like would be $2 to $5 million.  Construction costs would be 15 to 20% lower in these locations.

I hope that this present position by the Department of Corrections is merely a bargaining position--from a land use and community development perspective it makes no sense.  The State Auditor slammed it [.pdf] for improperly looking at alternatives--partially because state law requires death row to be at San Quentin.

The jobs created by this project will not benefit Marin residents, it costs more to build in Marin than perhaps anywhere else in the state, the operating costs will be higher, and there is no benefit to the state to being here.  Other than they already "own" the site.  Wait a minute--don't we--the tax paying citizens of California--own this site?  Is this the smartest move to make with our asset?

This site could anchor mass transit for the North Bay.

The planners at the county have thrown in the towel. Here was their vision plan for the site [.pdf]. From the Marin Countywide Plan 2007 Update:

However, it is the clear intent of the State of California to continue and expand the use of the San Quentin site as a State Prison for the foreseeable future. Therefore, the Vision Plan is no longer under consideration for inclusion in the Countywide Plan and is not discussed in this EIR.

To the rescue come our legislators. Senate Bill 228, decommissioning San Quentin, was introduced in February.  Our Senator Migden signed on.  It will likely be considered a "two year bill" due to the court ordered receivership currently running prison improvements.

The $336.5 million was not requested in the May revised spending plan.  Assemblyman Huffman was told that Schwarzenegger will ask for the money in a supplemental request.

 

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January 15, 2007

Now, That's What I am Talking About!

 

Tom Sargent, of Equity Community Builders, was on the front page of today's IJ announcing an insanely great land re-use of Fort Baker [the old military post on the north end of the Golden Gate Bridge.

Thanks to Tom's persistence, the process that began in 1998 has finally resulted in the entitlements and land uses necessary to return this asset to productive use--Cavallo Point- The Lodge at Golden Gate.

The plan is to create an upscale resort and conference center with a focus on the environment, in a national park setting.

"A meeting focusing on climate change or public policy issues that relate to the management of public lands or habitat conservation is what we would like to see," said Steve Kasierski, real estate project manager for the NPS. "We want people to think about Fort Baker as a destination for environmental and public policy meetings like the Aspen Institute. We want to create a sense of place."

 

Tom was my first boss out of graduate school, and boy did I have a lot to learn.  He was a good teacher, and is a great real estate developer.  Well done, Tom.

December 22, 2006

Land Use Insanity

..coupled with a budget bust and inability of our legislators to get us out of the corner that we have painted ourselves into.  I am referring to the 275 acres of bayfront, sun-drenched coastline that is probably the most poorly utilized piece of property in Marin County.

If you have been reading Cursed, you know that the old prison, a grandfathered land use from the 1850's, has been nagging at me for a long time.

The legislature approved $220K per cell in 2002.  We are now told the price has doubled.   I am cursed by knowing the numbers, and the numbers seemed funny a year ago.  For a land use that is wrong.  On a spot with incredible potential...

Is this game over?  Or a wake up call?  The corner we are in is because this is the only spot in California authorized by the Legislature to house condemned male inmates [the women are housed in Chowchilla].  The state auditor questioned the location.

We can start to fix this by changing the law...giving ourselves more options.  Now may be the last chance to recycle this site for a use that will make a difference--to California and to us here in Marin.  There is movement in Sacramento to solve the prison problem.  Now is the time to press for another location--let's change the law and get on with it.  Nothing can happen until the legislators change the law regarding death row and San Quentin.

This Glamour Slammer is running $440,000 a door, $1,100 PSF, just because it has always been there..

There is an alternative.

 A transit village linking ferry, car, SMART with homes for anywhere from 4 to 10,000 Marinites.  The State Auditor said from gains in prison operating efficiencies alone, the payback would be less than 30 years.

ABAG says we need the land for housing.  I understand that prisons are the third rail of State politics.  Not sufficient reason to continue this land use insanity.  This needs to stop.  Now.

Print out this letter [.pdf]and fax it to our State Senator, Carole Migden.

Print out this letter [.pdf] and fax it to our State Assemblyman, Jared HuffmanEmail Assemblyman Huffman.

November 5, 2006

Not SMART Enough

The Measure R ballot initiative this fall for diesel powered light rail service between Santa Rosa and San Rafael was, on its face, not a bad idea.  The right of way is publicly owned.  The goal is to provide a reliable alternative to the single occupancy vehicle--primarily for Sonoma County residents commuting to San Rafael.  The $467 million plan would run 70 miles, have 14 stops, 14 diesel trains, and have an estimated daily ridership of 5,000 passengers.

The problem is that the taxpayers are being asked to pay $668 million in sales taxes for a concept without a land use plan in place and no firm evidence of ridership  in what are primarily low density communities.

The major points are:

  • The North Bay--Marin and Sonoma Counties--has developed in a linear fashion along Highway 101--a natural for a rail corridor.
  • Traffic on 101 from San Rafael in Marin to Sonoma, and through Santa Rosa is nasty much of the day.  Golden Gate Transit bus 75, a commuter bus from Santa Rosa to San Rafael, takes 100 minutes on average to make this trip.  This would drop to 55 minutes on the train.
  • The advocates are focusing on the train, but not the land use patterns necessary to support it.
  • Ridership estimates are soft, and construction costs are unpredictable at present.
  • League of Women Voters analysis of this special tax measure is here.
  • The MTC supports the measure.

The rub was, once I did my due diligence, was that these horn blowing, diesel powered trains are not a better transit alternative, and there has been limited enabling of transit oriented development at the nodes--particularly the southern terminus, where the largest opportunity exists.   And ridership numbers are really soft.

The southern terminus should be at San Quentin.  A connection to San Francisco via ferry would be a natural at the San Quentin transit village.  Odd that Assemblyman Nation, the same one that proposed the SMART legislation, has been so absent when it comes to changing the law to allow this transit village to develop.  And the money raised from the sales tax is would be 70% of what is needed at San Quentin to recast the old prison property into a transit village with 86 acres of open space, 2100 homes, a deep water ferry terminal and other elements of a transit village.

The built environment nodes along the proposed route have not been planned in the density needed to make the train service self sufficient.  MTC estimates the density around each station should be roughly 2200DU.  Larkspur requires a ten to fifteen minute walk from the proposed rail station to the ferry terminal.   Transit Oriented Development is a policy that the MTC and BART have come to embrace now as a way of building ridership and providing adequate housing and retail options--thirty years after BART was built.

Train service is overseen by the Federal Railroad Administration.  The regulation and oversight makes for perhaps the safest mode of transport in the US. But many rail advocates argue that the FRA regulations have not only come at too high a price (by making rail prohibitively expensive) but in many cases are completely nonsensical.

Asking for $668 million for a transit plan that does not tie out with a smart land use plan is not very attractive to me as a voter.  Providing alternatives to life dependent upon the single occupancy vehicle is a good idea, but this plan does not do that, on many levels.  Tie this service to the redevelopment of San Quentin as a Cinque Terre transit village, and you might have something [and my vote]--but not the way it is presented here.

August 21, 2006

67 Million More Reasons to Change the Law...

The state director of finance, together with Angelides' office, on 16 August voted for a $67 million draw for construction of the new Condemned Inmate Complex at San Quentin at a recent meeting of the Pooled Money Investment Board.  Note to self--remember this when voting for Governor this fall.  Marin IJ report here.  State law requires condemned inmates, and any executions, to be held at San Quentin.

 

No voter approval required for lease revenue bond transactions--no matter how large.  Current state budget line is $220 million, no firm cost estimate on production costs yet.  This draw is enough to get sitework and utilities started, however.

"I fully expect them to end up going significantly over budget," Nation said.  "Before they finish this, they'll have to come back for an additional appropriation."

I posted previously about the history of the death row expansion.  The law must be changed before any meaningful dialog on location can be had.  The state has given no alternatives, the residents of Marin County are silent, and our elected representatives are taking no action.  The prison guards union is active politically--wouldn't the attraction of a new facility, with dramatically safer operating conditions, in a place where they can afford to live, make sense to them?

“There are no seasonal fluctuations, it is a non-polluting industry, and in many circumstances it is virtually invisible.”

 (A California Department of Corrections official explaining some of the benefits of putting a prison in a rural area).

What are the numbers?  Current scope is 764 cells, 6 180's as they call them, totaling  301,200SF of program at a  budgeted cost of 220 million.  Final costs will not be available until the drawings are put out for bid--What is the five step action plan to fix this current land use problem?

  1. Change the law. Previous attempt in 2005 can be downloaded here [.pdf].
  2. Recruit an optimal location via development/lease-purchase agreement that will acquire a modern facility in an area that values  the economic development benefits.
  3. Decommission San Quentin and gain specific plan, EIR and site development approvals for the County's transit village option.
  4. Build alternate facility, develop transit village.
  5. Move In.


Nothing can happen until the law is changed. 

Speak out now. Print out this letter, sign it and fax it in. What legacy do you want to leave?

Download this faxable form Letter to Supervisor Huffman.

Download this faxable form letter to Senator Carole Migden.

It is later than you think...

July 17, 2006

The Glamour Slammer

I don't like smacking other people's deals down...I know how much work goes into making something happen, into breathing life into it.  I know what it is like to have rocks thrown at my projects.  It hurts. 

That said--this is a deal that once I understood the numbers, and looked at all the reports, plans, and budgets, made me scratch my head.  No, it actually left me dumbfounded that this passes for planning and what we want on this site. 

This 400,000 square foot, no tax paying, project went through its approvals--including a bulletproof EIR--by EDAW--and is now facing the construction risk part of the sequence. They whacked over a third of the project in 2005 to keep in within the $220 million budget they were given in 2003.  Working drawings are in process.  Meanwhile, construction costs on private sector projects are going up 2% a month in the Bay Area.

 

The land is 275 acres of some of the best waterfront, southern exposure property I know of, adjacent to the Richmond-San Rafael Bridge, next to a good windsurfing beach, and is 17 miles from downtown San Francisco.  Access to interstate 580 and 101 are adjacent.  And did I mention there is ferry service adjacent that goes direct to the Ferry Building in downtown SF?  And if you are a legal resident of California--you are part owner (along with 34 million of your neighbors).

Yep.  Its the new Glamour Slammer, or in official terms, the Condemned Inmate Complex Project at San Quentin.  I won't get into the politics here and here.  Or what the Sierra Club says here about an earlier project on the grounds.  Or what the State Auditor said in 2004.   And at a cost of roughly $270K/bed budget where the average statewide cost is $150K/bed.

 

So how did we come to deserve all this penal goodness?  Let's take a look at the numbers...


The state did a reuse study  in 2001 that showed relocating the entire 5,700 inmate requirement to a new location would cost $800 million.  The land was worth about $100 million under existing land use policies (500 units of housing) after demolition and cleanup.  If a denser transit village option with new transit hub, ferry terminal and 2,100 units of housing were entitled, the state would recognize roughly an additional $300 million.  If the property were entitled for 3,500 units, the state would recognize roughly an additonal $100 million on top of this. 


The State Auditor's math basically said our county could use the property to help solve some of its housing and transportation issues, but the state would have to spend roughly $400 million to build a new facility elsewhere.

Status: The Department of Corrections is completing working drawings for the Condemned Inmate Complex at this time.  BCDC is reviewing Major Permit Application 2-06 to place an electrified fence, guard tower, etc. within the 100 foot shoreline band of the site.

Baseline: San Quentin State Prison is located on 275 acres located on San Francisco Bay.  It is home to approximately 5,700 inmates and 1,600 employees.  640 of these inmates have been condemned, and are awaiting execution.  This number grows by about 20 per year.

A bill requiring San Quentin to be decommissioned no later than December 31, 2010, SB901 died in the State Senate in on January 31, 2006.  Methinks it died because it called for a complete project CEQA exemption--which would save a couple of years, but asked for an unallowable lack of oversight and absence of public dialogue.

The Legislature budgeted $220 million in August 03 to build a new prison on San Quentin grounds because the antiquated facilities, lack of an electrified fence and a security perimeter increased the likelihood of escape of these extremely violent prisoners, particularly in the event of a major earthquake.   The state currently has a 5,000 maximum-security prison bed shortage.  California state law requires all male condemned inmates to be kept at San Quentin.

The Department of Corrections borrowed $8.5 million from the General Fund in 03 to start planning and approvals.  An EIR was done in 2004. The initial cost estimate was 400,000 square feet at a cost of $139PSF or 43% of the total budget.  Soft Costs and site prep were estimated at 31%.  Contingencies and allowances were budgeted at 26%.

Meanwhile, the County has prepared a draft land use plan that states "Reuse of the site...would be limited to that which result in impacts no greater than impacts from prison use of the site prior to its proposed reuse."

OK--so how do we quantify these impacts?


The Upside--Marin County residents and visitors would get 86 acres of open space, a new bayfront trail, a city, a multi-modal ferry transit hub with deep water ferry access (no more dredging), a museum in a historic schoolhouse, and hundreds of affordable housing units--if the vision plan is to be believed, a Cinque Terre on the Bay.  The vision plan is available here.


Water use by this transit village is estimated at 450 acre feet /year (AFY), 500AFY less than the 961AFY used by the prison in 2003.  This savings constitutes more than 10% of our existing potable water shortfall for the county, perhaps delaying the construction of MMWD's desalinization plant. 


Property tax revenue would be in the range of $8 to $10 Million per year upon full buildout.  The existing site pays no taxes.  15 to 20% of the housing would be set aside as affordable--that's 300 to 400 units in a county with the highest housing prices in the country.   A pedestrian, car-free environment (think Cinque Terre).

Don't forget "Due to the crowded, antiquated facilities, inadequate physical plant security; and insufficient medical, exercise and service space, the department {Department of Corrections] has concluded that housing the condemned male population in the current facilities at San Quentin poses a severe safety and security threat to the public, staff, and other inmates".


The State of California would have a new prison, designed to the latest codes, and in a location where operational costs would be more reasonable.


The Downside--There is a $400 million net cost to the state to replace the existing prison in another location.  (that is about $12 per California resident, or about $65 per Bay Area resident, or $2200 per Marin County resident). Traffic from the site would increase five-fold with the housing and transit hub operations, even with a better modal split. (Existing 3050 trips/day, Glamour Slammer adds a projected 213 trips/day, Transit Village estimate is 15,900 trips/day per EDAW).  Sir Francis Drake would have to be widened from 2 to 4 or 6 lanes fm 580 to the site to accommodate this and add an westbound onramp. 

The Rub--The environmental review process for a re-use of this site is long, expensive, fraught with loss of focus, and does not take into account both the direct and the ripple effect of the multiple benefits that a new community on the shores of the Bay would have on both sides of the Richmond-San Rafael bridge.

 

 

For example, in 2004 EDAW stated "this alternative [the tax paying, productive 4,000 resident transit village] is environmentally inferior to the proposed project {Glamour Slammer]."  Ouch.

  And this is what passes for planning today?  No wonder housing is so fricking expensive here--and so far away from where you work.  The "experts" can't even understand what the real benefits are.  It is not the consultant's fault, it is the way we frame the discussion about net impacts of different land uses.

Reuse will be limited to those land uses with impacts no greater than current impacts from prison ops.   How do you net out the impacts of a billion dollar project?  Does

  • reducing our net water consumption,
  • increasing our open space,
  • our access to the Bay,
  • providing thousands of construction jobs,
  • developing 2100 units of housing within walking distance of transit options,
  • deep water ferry access--no more dredging,
  • hundreds of affordable housing units, and
  • increasing our property tax base by $8 to $10 million

counterbalance the traffic increase?


Does bulldozing a 150 year old, antiquated, operationally risky, hard to staff, cramped prison with security issues and replacing it with a transit village on the sunny shores of San Francisco Bay count as a positive impact?


Does putting $1 billion of our capital to work productively on building this new community count as a positive impact?

My take away is that because we can't get our land planning act together, we can't effiectively recycle this property, and hence we lose an opportunity to recapture a great location. 

The wheels are in motion to spend up to $220 million here to house 1,400 condemned prisoners in a new facility to "provide security for the public from some of the most violent inmates in the state".  On the sunny shores of San Francisco bay. 


To me, it looks like right project, wrong location.  This isn't a NIMBY reaction--it is simply not the best use, and we are using litigation and bureaucratic duress instead of  an action plan that listens to what this amazing site wants to be.


The Numbers--the Department of Corrections would have to reduce its annual operating costs by 7% over thirty years to get this relocation to pencil out for the taxpayers.  San Quentin is more expensive to operate, more dangerous for the corrections officers, and has recruitment and retention problems due to its location (only 14% of the labor force lives in Marin, including 86 homes on the grounds).  This shouldn't be hard to do.


The Risk--no one wants to own is to be responsible for breathing life into the vision  of a new community on the Bay.  The $10 million in at-risk capital and ten years to get this new community through the entitlement gauntlet to come out the other end with a walkable, new, productive community on the sunny shores of San Francisco Bay. </p>
<p>Instead we get a prison.  And plenty of vision studies that tell us what could have been. With an approvals process this broken, maybe that's what we deserve. 

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