Get used to that big hole on 12th Street, folks. It isn’t going anywhere.

You know that giant pit in the ground on 12th and Jefferson downtown? It’s like a block away from the half-built condos at 13th and Jefferson. The space was supposed to become 601 City Center, and in theory, we still have that to look forward to…in 2017.

Yes, you read that right. The project, which broke ground last October (click through and read that link for a good laugh), was originally supposed to be completed by Spring 2011, although the City’s deadline was April 2012. Last night, the Oakland Planning Commission approved a development agreement that would extend the completion date by 36 months (PDF), until April 2015, and on top of that, provide two options for twelve month extensions, for a total of five years of extension.

So basically, Shorenstein had a deadline of October 1st with the City to start building, so instead of just getting a damn extension on that, they fenced off the site, closed the sidewalks, and dug a giant hole in the ground, then abruptly stopped construction two months later.

Okay, so obviously, it’s incredibly annoying that Shorenstein wants to basically abandon their big pit on 12th street for five freaking years, but, hey, developers are like children, whatever you let them have, they will take, and if you fail to clearly establish adequate boundaries, you can’t really blame them for acting like brats. So my real beef here is with the City, which is basically saying that we’re perfectly okay with leaving a giant hole in the ground in the middle of downtown Oakland indefinitely. Their position is that by charging $200,000 for the fourth year extension and $300,000 for the fifth year, they’re providing an incentive for Shorenstein to not wait the full five years.

You know what an even better incentive for Shorenstein not to wait the whole five years to resume construction would be? Don’t give them five years! dto510 spoke at the meeting, arguing that three years should be a sufficient extension, but he was unable to convince the Commission. Ironically, in October, when other developers who have not yet disrupted neighborhoods by closing off sidewalks and digging giant holes in the ground came before this exact same Commission and asked for a three year extension on the date they would have to start building their projects because of the economy, they were told that three years was totally excessive, and that they should be content with one year. (The Council later approved a modified version of the extension, giving everybody until December 31, 2011 (PDF), regardless of when their original deadline was.) Anyway, the Commission had none of those same concerns with giving Shorenstein five years to do nothing – according to Commissioner Doug Boxer, if we only gave them a three year extension, they might just abandon the project altogether, even though they’ve already bought all the steel for the building.

So, once the Council gives the thumbs-up, Shorenstein gets five extra years to complete construction on the tower. In exchange, the neighbors will get their sidewalks back during the interim and will get a sturdy, permanent fence around the lot instead of the green construction fencing that’s there now. Shorenstein has also agreed to provide as much as $50,000 for art on the site, most likely in the form of a mural painted on the fence. And that’s it. Seriously.

Just in case I haven’t been clear enough about this yet, let me sum up. Shorenstein broke ground on their new office tower on the block between 11th and 12th Street and Jefferson and MLK in downtown Oakland in October of 2008. The City now wants to give them, and the Planning Commission agrees, until 2017 to complete that project. 2008. 2017. That’s nine years of an entire City block in the heart of downtown Oakland, a block that, by the way, sits right in between the two major access streets taking people in and out of downtown, being either a construction site or just a big abandoned pit. And we’re supposed to feel grateful that Shorenstein is willing to spend a pathetic $50,000 painting the freaking fence?

Shorenstein, apparently, since they’re not required to spend any money on public art, seems to think that offering to paint the fence while they sit on their big pit is generous. The fence painting was repeatedly referred to as a “community benefit” at yesterday’s meeting, which, frankly, is like, totally nauseating. Making your construction site a little bit less visually offensive is not a “community benefit”, it’s a mitigation, and the City should demand nothing less in exchange for their obscene generosity with Shorenstein’s deadlines. Actually, they should demand more.

Oh, also. The poor dry cleaner a block away who has lost, like, all her customers from 555 12th St. since Shorenstein closed the sidewalks between there and her store and put up a big fence so nobody can see that it’s there anymore, wanted a sign on the fence just letting people know she was still open, but the Commission didn’t go for that either. In fact, Commissioner Doug Boxer scoffed at the request, saying it would be “free advertising.”

It’s just incredible. We are constantly listening to self-righteous whining from anti-development activists about how developers should all be required to provide “community benefits,” by which, of course, they don’t mean actual benefits to people who live near the project, but rather, huge arbitrary and unrelated payments either to the City or some random non-profit in exchange for being granted permission to construct something the law says they can build anyway, and everybody acts like what they’re saying is totally reasonable and half the Council totally wants to do it. But expecting developers to deal with an actual giant mess they’ve made in a reasonable amount of time? And provide minimal mitigations to their eyesore in the interim? Well, apparently that’s just crazy talk. No wonder Oakland is such a damn mess.

25 thoughts on “Get used to that big hole on 12th Street, folks. It isn’t going anywhere.

  1. Max Allstadt

    What I don’t get is this:

    The extension is being granted based on the state of the economy, yes? We can’t predict the economic future over 18 months, let alone 5 years. So why grant such a long extension?

    Wouldn’t it make much more sense to tell Shorenstein to come back near the end of 2011, when the council-mandated entitlements expire? If the economy is no longer a wreck at that point, they should have to start building.

    5 years is too much because it allows construction to be put off until it is most profitable. The city should only accommodate a postponement until construction becomes feasible, not until it becomes convenient or overly lucrative.

  2. V Smoothe Post author

    Since Shorenstein has already started building, the entitlement extension does not apply to them. They need an extension on the completion date for their building permits. I’m annoyed at Shorenstein for breaking ground then stopping their project immediately, but nevertheless, I don’t think it’s unreasonable for the City to make some accommodation due to the economy. But 5 years is way too long, far beyond reasonable, and I also think they should be expected to make more of an effort to mitigate the huge mess they’ve created in the interim.

  3. Max Allstadt

    They should indeed mitigate the impact of their project. $50k for art on a fence is ridiculously insufficient mitigation. One or two partners at Shorenstein could easily spend that in Vegas in a weekend.

    But what would be a better mitigation? A 16 foot art wall instead of a 10 foot fence? Temporary rock climbing gym in the pit? Here we go again, off to miniature golf land…

  4. Jennifer

    The comment about not wanting to do free advertising for the dry cleaner is such BS. I see signs all the time on construction sights for businesses whose visibility is being impacted. Did the dry cleaner damage a shirt of someone who is politically connected, and this is payback?

  5. Andy K

    Could not agree with Jennifer more.

    I have worked on construction projects in several Cities in the Bay Area, and in every case the local government did what they could to help the adjacent businesses. Signs are cheep, and I have seen them put up all the time.

    It seems that the City is some how afraid to put the hammer down on these guys.

    I assume that Shorenstein will build this site as soon as it makes sense financially, as they have existing costs to re-coop. So who, knows, they might start sooner. At least one can hope.

  6. V Smoothe Post author

    I think that the appropriate mitigation to the visual blight is something that should be worked out with the neighbors. And I think the $50k Shorenstein has indicated they’re willing to spend is too low. Five years is a long damn time, we should have something nice looking there.

    And remember, just a few weeks ago, the City seemed to think it was completely reasonable to demand Forest City subsidize a parking lot to the tune of $200,000 on a smaller lot where they’re supposed to start construction in only two years.

  7. livegreen

    Yeah, this reminded me a lot of the parking lot. So why the difference? As Jennifer says, pure politics.

    Which makes me wonder…beyond just the beauty and power of the Shorenstein name, and beyond simply making assumptions to the contrary, how do we know there’s no quid pro quo involved somewhere here?

    I mean, I know our democracy is highly reputed to be above such underhanded dealings so it’s highly unlikely that anything at all would possibly happen either in Oakland or nationally. (Ted Stephens and Don Perata are, after all, totally exonerated). But you’d think that the City would try to institute some logical process and uniform time-period that all companies would follow to at least avoid the appearance of any wrong-doing.

  8. Becks

    The only thing worse than this decision is that you passed up a perfect opportunity to reference Parks and Recreation. Come on V, what are you waiting for?

  9. V Smoothe

    I know, I know! I felt so bad about that, but I didn’t wake up early enough this morning to give myself sufficient blogging time. I just couldn’t figure out how to work it in before I had to leave, and since posting has been so sparse here lately, I didn’t want to wait until after lunch to finish.

    Honestly, what I really wanted to do was figure out a way to work in this parody of the Parks & Recreation plotline from this crazy LA vlogger, but I guess I’m just not that clever before 8 AM.

  10. livegreen

    Which goes to show we DO need our own TV show about Oakland.
    They’re ripping us off anyway. We might as well get paid for it…

  11. Navigator

    V, I couldn’t agree with you more on this one. This is really disappointing for the development of Downtown. Why rush to dig that hole? Does Shorenstein receive any sort of tax advantage for having started construction? Is this basically a way to squat on the land? I don’t get it?

  12. Doug Boxer

    Hey V:

    As always, I appreciate you giving a forum for people to discuss PC issues but I’d appreciate it if you are going summarize my comments that you would indicate my entire comments and not just take one or two comments out of context.

    Jonathan Bair made three points at the hearing:
    1. Five years is too long of an extension
    2. The dry cleaner was losing business from the tenants of 555 Broadway after the surface lot was removed, and
    3. He wanted to have Old Oakland Neighbors involved in approving the artwork that would go up on the site.

    I commented on two of them (and supported #3 but other commissioners added language to the condition re: artwork approval and the involvement in the approval process so I didn’t mention anything).

    As for #1, this project isn’t just a 25 or 50 unit condo project. It’s an office tower with hundreds of thousands of square feet of office space, and one which will define our skyline. I don’t like it that there will be a hole in the ground either but I’d rather have that building built than go through the entire entitlement process all over again. That was the point I was trying to make.

    As for #2, if you go back and watch my comments, you’d see that I expressed concern for the dry cleaners. I asked Shorenstein to pass out flyers to all the tenants or post a sign at the front desk saying the dry cleaners is open for business. The Shorenstein representative said they are going to provide a space within the building where tenants can drop off their dry cleaning. Given that Mr. Bair mentioned the reduction in business related to the tenants not being able to get there easily from the surface lot, I thought the drop off spot in the lobby seemed like a reasonable solution.

    Hope this provides a bit of context.

    db

  13. V Smoothe Post author

    Doug –

    As with any form of reporting, blogging has its limitations – it would be nice to write about everything everyone says, but at that point it would probably be more efficient to just post video of the meeting. For readability’s sake, you have to pick and choose. (For example, I didn’t even mention Commissioner Mudge’s comments about the fee payment amounts/timelines, even though I thought they were excellent, because I felt the issue was too technical and not immediately relevant to the general point I was making.) I never intentionally misrepresent anyone’s statements, but of course the beauty of this forum is that anyone who feels their thoughts have been characterized unfairly can respond and explain their position in more detail.

    Regarding the dry cleaners – what was said was not that Shorenstein is placing a dropbox in the lobby, but that they are in negotiations and may place a drop-box in the lobby. I think this would be the ideal solution, but as long as it is not a requirement of their extension, I do not think we can be confident such a thing will happen until a final agreement is reached. Absent the drop-box, a sign directing people to the dry cleaners and saying that it’s still open permanently affixed to the fence is completely different than a one-time flyer distributed to tenants, which people will likely forget about almost immediately, and certainly would forget about within five years.

    As for the timeline – I agree that 601 is an important project, but that should not give Shorenstein free reign to leave a gaping hole downtown for an indefinite period of time. A three year extension may be reasonable in light of current economic conditions, but five years – which is beyond the length of an entire economic cycle, is completely unjustifiable. Giving Shorenstein even more time is no more of a guarantee that the project will ever be built, but should they decide after five years that they still can’t do it, we will have wasted two full years that could have been used to entitle a new project, setting downtown back even further.

  14. Max Allstadt

    I’m at a loss as to how this extension could not be set up with some sort of simple renewal regime. Start at 2 years. If after 2 years, an appropriate set of bench marks in the economy have been passed, no extension. If were still in a mess, renew the extension.

  15. V Smoothe Post author

    Well, that’s sort of what they did. A three year extension with two one-year extension options on top of that. I don’t think they should have included the options.

    If things are still just that awful in three years, Shorenstein should have to come back and make their case for another extension all over again.

  16. livegreen

    Max and V are right. And it makes Shorenstein and the Planning Commission look bad to give them special conditions (whether there is behind the scenes quid pro quo or not).

  17. len raphael

    i don’t know the details of Forest City deals, but maybe FC still needs city cooperation and or additional subsidies but Shorenstein does not. We need Shorenstein more than they need us. Wouldn’t call that politics but economic power.

  18. Max Allstadt

    you’re right V, a full hearing is more appropriate than just setting a bar. Real estate economics and market conditions are too complicated to just set stats and evaluate the need for an extension based on numbers. They should be required to come back in 3 years.

    On the other hand, documentation that says 5 years but means 3 with a possible 2 year extension is potentially OK with me. It would give Shorenstein a piece of paper to show investors that looks like a 5 year guarantee for the most part, but it would also keep them beholden to the city on a shorter term.

  19. Naomi Schiff

    Maybe no one here remembers it, but when there was a long hiatus in building at city center a couple of us (me and landscape arch. Chris Pattillo and maybe somebody else) got the then-developer (Bramalea? Glen Isaacson?) to landscape the slag heap that was a similar transitional site. They put in grass and trees which remained for some years until they were ready to build. It had the good side effect that it was a lot easier to lease adjoining office space if it didn’t include a depressing view. The truth is that we can’t have any idea when Shorenstein will resume construction, same as with 12th and Broadway (SKS) which I am hoping we can get prettied up as well.

    Oakland has a long tradition of begging developers to walk all over us. We don’t need to do this.

  20. Frankie D

    Two steps forward and one step back this has been Oakland’s M O for downtown development since I can remember. Back in 1973 I did an oral presentation for my 9th grade civics class (yes I am proudly giving my age away) about the great Oakland City Center Development, and how spectacular it was going to be now that BART was completed. Well here we are midway through 2009 and all the parcels that were cleared to make way for that old City Center concept have still not been developed. Fish evolve into reptiles at the same pace that building projects seem to reach completion in DTO.

  21. V Smoothe Post author

    BTW, a car fell into the pit a couple weeks ago. So now we really are like a TV show. This came up at tonight’s Planning Commission meeting.

  22. V Smoothe Post author

    I’ve been informed that the incident discussed in the video above is not the same accident I had heard about. The Jaguar happened during commute hours, and as I understand it, did not actually go all the way into the pit. But this other accident (which an acquaintance has photographs of) happened on a Saturday, and the car was pushed completely into the pit.