Presentation Title
Second Line
August 15, 2016
1 City of Alameda
Study Session on the
Future of Housing at Alameda Point
City Council Meeting
September 3, 2024
Agenda
1. Study Session Purpose
2. Current Planning Context
3. Economic Realities of Housing Construction
4. Next Steps and Staff Recommendation
2 Study Session Purpose
• Provide a common understanding of
– Opportunities to provide more housing at Alameda Point – Planning context guiding these opportunities
– Economic and structural barriers that limit housing production • Review staff work plan to advance additional housing
development at Alameda Point
– Implementing Housing Element Goal H-5 and Program 1
– Understand how housing fits into Alameda Point Disposition Strategy 3 Plans are in Place for New Housing at Alameda Point
The City has established a clear path for additional housing growth:
• Citywide Housing Element (2022)
• 2040 Citywide General Plan (2021)
• Alameda Point zoning district AMC 30-4.24 (2014)
• Alameda Point EIR (2013)
Various City plans establish other important design and implementation strategies to accommodate this growth:
• Alameda Point Public Services District (2017)
• Master Infrastructure Plan (2014)
• Main Street Neighborhood Specific Plan (2014)
• Waterfront Town Center Precise Plan (2014)
4 129 acres of future
housing and mixed-use
with residential
opportunity
– Main Street
Neighborhood
– Waterfront / Town
Center Precise Plan
– Adaptive Reuse of
Buildings 2, 4, 17
5 Substantial Opportunity for More Housing
Planning Context – Affordable Housing
At least 25% of new units to be affordable:
• Renewed Hope Settlement (2001) sets this requirement • Standards of Reasonableness (1999) provides additional requirements for services and space for unhoused individuals
Citywide Affordable Requirements also apply at Alameda Point:
• Inclusionary Housing Ordinance (2004) - Inclusionary requirement for all new residential development of five units or more
• Nonresidential Affordable Housing Unit/Fee Requirement (2001) can be satisfied through in-lieu fee
• Affordable Housing Density Bonus Ordinance (2009; 2015) adopted to comply with State law
State Policies also affect affordable housing development:
• City anticipates a Pro-Housing Designation which would increase competitiveness for grants
• Surplus Land Act (AB2319, Bonta, 2022) reinforces 25% affordability requirement for Alameda Point specifically
Planning Context – Master Infrastructure Plan (MIP)
Replacement infrastructure is a requirement for new
development
• Existing infrastructure is over 70 years old
• Infrastructure replacement is necessary for new
construction and long-term use - Total costs estimated
at approximately $700 million or ~$2 million per acre
• Master development expected to replace as
consideration for land
• Building sales revenue covers infrastructure costs in Reuse Area
• MIP & Disposition Strategy provides for the phased
replacement of backbone infrastructure at Alameda
Point – replacement infrastructure planned to move
east to west
7 Planning Context – Housing Production Status
8 The City’s existing, built and planned units are approaching the Conveyance Agreement Excess Housing Cap
The Conveyance Agreement with the Navy requires that every market rate unit above 2,011 market rate units must pay a fee – currently $104,000 per unit – upon Certificate of Occupancy.
Market Rate Units
Residential Baseline Units, Navy Agreement 2,011
Existing + Future Units with Approved DDA 1,761
Remaining Market Rate Units until
per unit payment to Navy begins to apply
250
Economic Realities of Housing Construction
9 Difficult Overall Market / Feasibility Dynamics:
• High construction costs and stable prices are bringing much Bay Area development to a halt
• Ownership housing, especially townhomes, are most feasible currently due to higher price point and lower construction cost than multifamily buildings • Alameda Point housing projects hindered by need for large, high-risk up-front investment in infrastructure
Funding for Affordable Housing Projects is Limited and Getting Harder:
• Constrained local, county, regional subsidy sources
• Reduced funding in state budget (removed Multifamily Housing Program funds) • Scoring disadvantage for family units as not in a “High Resource Area” per
CTCAC/HCD
• Removed from “Difficult to Develop / Qualified Census Tract” status, which provided funding boost
1. Added costs to replace aging infrastructure, adapt to sea level rise with higher elevations
2. Navy Economic Development Conveyance Agreement
3. 25% affordable housing on site per Renewed Hope Settlement vs. 15% citywide inclusionary
4. Project Stabilization Agreement Resolution
5. Services Community Facilities District (CFD) to
Fund certain services at Alameda Point to maintain fiscal neutrality for City Fund Transportation Demand Management
Reduces ability to use CFD tool to address high infrastructure costs 10 Special Cost Considerations for Housing at Alameda Point Incentives for Housing Development at Alameda Point
The City has taken many steps to incentivize housing:
• Specific Plans and CEQA Clearance
• Subdivision ordinance changes (streamlined approvals) • Advanced housing development (Bayport, Site A, West
Midway, RESHAP)
• No parking minimums | transportation management program to offset impacts
• Accept infrastructure in lieu of land payment
• Loan for RESHAP infrastructure & proactive support of RESHAP in grant funding applications
• Waive some impact fees
• Pursuing Citywide Pro-Housing Designation
11 Per Unit Housing Costs Exceed Possible Revenues Today 12 Conceptual Townhome Revenues vs. Cost Conceptual 3-Story Rental Revenues vs. Cost
Site A Development Example – Economic Realities
13 Why is housing construction paused at Site A?
• Tighter lending environment: Private financing plan is reliant on debt to fund design / infrastructure up front
• Project Labor Agreement (PLA) encompasses both infrastructure costs and vertical construction (unlike West Midway) increasing construction cost up front • Multifamily Construction: Blocks 10 and 11 are multifamily (see prior slide) • Economic Force Majeure: Disposition and Development Agreement (DDA) allows project to pause if housing prices drop (which they have) – awaiting 4 quarters positive growth
Site A 2022 Amended Development Plan Current Condition
Staff and Navy have tentative
agreement on Excess Unit Fee:
• Adjust escalation factor from
Housing Price Index to Consumer
Price Index
• Offer developers an up front
payment option
For future consideration:
• Modify to per acre instead of per
unit fee (to support multifamily
housing)
14 Incentives for Housing Development at Alameda Point
Considerations
• Market conditions
– Limited predevelopment capital
– Timing entitlements with market cycle
• Main Street neighborhood
development is dependent on
completion of RESHAP
• Retain and enhance the historic
homes (“Big Whites” and
bungalows)
• Consider stability concerns from
existing tenants
Incentives for Housing Development at Alameda Point
Advance more housing development in Main
Street Plan Area:
15 Advancing Development of Main Street Neighborhood
16 Staff Work Plan to Advance Housing at Alameda Point
17 1. Finalize Navy Conveyance Amendment on Excess Unit Fee for Council consideration
2. Continue to proactively seek grant and other funding opportunities for RESHAP
3. Advance Development of rest of Main Street Plan Area (“Package K”): advance goals for development, community engagement, market analysis
4. Explore development of Enterprise District residential buffer area on Main Street
5. Open to proposals for Bachelor’s Enlisted Quarters (BEQ - Buildings 2, 3, 4) but not a high priority
6. Delay advancing mixed-use areas until multifamily market recovers
Thank you
18