Vote on Luxury Apartment Tower Postponed, As Councilmembers Seek Improved Community Benefits

By Ken Epstein

A number of Oakland residents have been waiting to see what the City Council will do next after protesters shut down the May 5 council meeting where the council was scheduled to authorize the sale of a piece of lakefront property to a private developer.

Abel Guillen

Abel Guillen

The issue was not on the May 11 council agenda and is not scheduled to be discussed next week at the May 19 council meeting.

In interviews with the Post, councilmembers said they are extending the time before bringing the motion to a final vote to allow staff and Councilmember Abel Guillen – who is leading the effort – to negotiate with the developer for more community benefits, including the possibility of affordable units on site.

At their May 5 meeting, councilmembers were stunned when well-organized protesters chained themselves together, seized control of the meeting and forced the council to adjourn without conducting any business.

The protesters – a coalition that included a neighborhood group called Eastlake United for Justice and black seed – produced a bullhorn and turned the meeting into a rally for their demands, calling for public property to be developed for affordable housing and other public uses – not sold to private companies to build luxury apartments as a one-time boost to the city’s budget.

The council is set to sell the piece of city-owned property at the corner of E. 12th Street and Lake Merritt Boulevard for $5.1 million to build a luxury apartment tower.

The proposed developers are Michael Johnson and his company Urban Core Development and Johnson’s financial partner UDR, a self-administered real estate investment trust (REIT) based in Denver that owns, operates, buys, renovates, develops, and manages multifamily apartment communities located throughout the country, headed by CEO and President Thomas Toomey.

Councilmember Guillen told the Post that he and city staff are having productive talks with the developers, and the final proposal should come to the council in June.

“We’re still in negotiations with the developers, trying to get the best deal possible for the City of Oakland.” he said.

Thomas Toomey

Thomas Toomey,  CEO of UDR

He continued: “I’m working on having affordable housing on site or offsite and other community benefits. We’re looking at all options.”

But Guillen cautioned affordable housing advocates not to expect too much.

“At the end of the day, we’re not going to please everybody here in Oakland,” he said. “We need both affordable housing and market-rate housing, and this project is really about market-rate housing.”

One-bedroom apartments at the proposed building will rent for about $3,100 a month.

Michael Johnson  of Urban Core Development. Photo by Ken Epstein

Michael Johnson of Urban Core Development. Photo by Ken Epstein

Council President Lynette McElhaney, who backs the property sale, said Guillen was prepared to make a motion at the disrupted May 5 meeting asking for additional time to negotiate with the developer.

“We haven’t scheduled (the issue) yet,” she said. “I´m not sure yet when it will come to council. I’ve been leaning on Abel’s leadership.”

“It’s his district, and there are concerns he has had that he wants to be addressed,” she said. “We needed the time to get in touch with the developers to discuss things he thought would enhance the project.”

At a recent Community and Economic Development Committee (CED) meeting, Guillen requested that the city seek a new appraisal on the property. He said he believed the property was worth about 25 percent more than what the city is selling it for.

Committee members, including McElhaney and Larry Reid, rejected this proposal.

Courtesy of the Oakland Post, May 16, 2015 (postnewsgroup.com)