A hilltop view from Parcel A, the 63-acre first phase of the ambitious redevelopment of San Francisco’s Hunters Point Shipyard, offers a panoramic look at this property’s toxic past, a nearby neighborhood’s blighted present, and the uncertain future of a project that, from day one, has been steeped in controversy.
Called “the most important development project in the history of San Francisco” by Michael Cohen, the city’s director of economic and workforce development, Hunters Point has been a work in progress for more than 30 years. The Navy walked away from the shipyard in 1974, and the Defense Department closed it for good in 1991. Two years later, Congress authorized the cost-free transfer of the land’s ownership to the city and county, which presented San Francisco with nearly 500 acres of prime waterfront real estate available for redevelopment. That land, though, is highly contaminated and its cleanup by the Navy could take decades to complete.
The Navy and the EPA deemed Parcel A—the first of five stages—ready for residential reuse in 2004. Soon afterward, the city signed a development pact with Lennar, which in 1999 outbid several other companies to become the master developer. San Francisco’s Redevelopment Agency handed the land over to Lennar, which has spent more than $100 million on Hunters Point’s redevelopment so far. Lennar has also spent $1 million on public relations, some to defend itself against allegations of cronyism, project mismanagement, deception, and environmental indifference.
Those accusations grew louder last summer when the city’s supervisors approved the framework of a proposal to merge Hunters Point with the revitalization of nearby Candlestick Point. The combined projects would redevelop 771 acres along San Francisco Bay with 8,500 to 10,000 homes, of which as many as 3,500 homes would be priced affordably for buyers earning up to 120 percent of the market’s median income; 350 acres of parks and open space; an 8,000- to 10,000-square-foot arena; 700,000 square feet of commercial and retail space; an artists’ village; research and development facilities; and possibly a new football stadium. Kofi Bonner, president of Lennar’s Urban Land division for Northern California, estimates the total “horizontal” cost of Hunters Point and Candlestick Point at $1.7 billion and the “vertical” cost at $6 billion. Lennar could have its first homes completed by 2009.
That is, if Lennar doesn’t pull out of the project, which it’s threatened to do if San Franciscans vote for Proposition F, which calls for half of the homes to be priced for buyers earning between 30 percent and 80 percent of the city’s median income. A competing Proposition G, which the city and Lennar support, requires 25 percent affordable housing. The city was obligated by law to submit the redevelopment proposal to voters because it wants to convert recreational land for non-recreational use.
At the city’s request, the CBRE Consulting/Sedway Group division of CB Richard Ellis analyzed Proposition F and concluded it would reduce Lennar’s revenue by at least $1.1 billion. “There are levels of economics and difficulty to pull off, and 50 percent would overburden a project that is, frankly, already overburdened,” Bonner told Builder during an interview in April inside the company’s trailer at the shipyard site.
Saving a Neighborhood
Hang around the Bayview section that straddles Hunters Point for a few days and you discover that this project is about more than redeveloping land. Proponents see Hunters Point as the salvation for a tough neighborhood, one-fifth of whose 35,000 residents lives below the poverty line. About 46 percent of those 35,000 residents are black, and they have watched the black population dwindle to 6.5 percent of San Francisco’s total in 2005, compared to 13.5 percent in 1970, according to Census Bureau estimates.
Gary Evans, a liaison between the community and small businesses, says he’s received commitments from 380 companies to come into the neighborhood if this project goes forward. “Hunters Point can be the economic engine that drives this neighborhood,” proclaims Dr. Arelious Walker, pastor of the True Hope Church of God in Christ and one of Lennar’s strongest boosters. Walker and others here praise the builder for its willingness to stick with a troubled project during the housing downturn. “What the city, with Lennar, has done is somewhat incredible,” says Angelo King, chairman of the Bayview Hunters Point Project Area Committee. Lennar’s community outreach, says Bonner, includes a $27.3 million fund, funneled through the city, to help finance mortgages for homes in Bayview over the next eight years; $30 million in contracts with local construction companies; and $8.5 million for apprentice training programs.