Developers express concern as the centerpiece of a high-profile redevelopment project is burned down.
Setback for city’s Auto Row project ‘a game changer’
Oakland’s residential builders were reeling Friday as word spread that a centerpiece of one of the city’s important redevelopment areas had burned down, the latest in a series of fires to destroy new housing the city so desperately needs.
The partially constructed building, the Alta Waverly at 23rd and Valdez streets, was being developed by Wood Partners and was scheduled to open next spring, bringing 196 apartments and 31,500 square feet of retail space to the city’s old Auto Row. It is to be the biggest project to date in Oakland’s Broadway Valdez District, a redevelopment area where just under 3,000 housing units and more than 360,000 square feet of retail is in the pipeline.
The fire comes less than two months after a similar early morning fire destroyed a housing development at 3800 San Pablo Ave. just over the Emeryville border from Oakland. That fire, which has been ruled arson by authorities, was the second suspicious blaze at the San Pablo Avenue project.
Developer Rick Holliday, who is building 3800 San Pablo, called the Alta Waverly fire “a game changer.”
“It sort of indicates that this is a war on housing,” Holliday said. “All three fires were at the same time and at the same stage of construction and used similar means and methods.”
Housing development in Oakland was slow to take off after the recession that started in 2008, even as thousands of units were added in San Francisco. It has been only in the past year that many builders have jumped into the market.
The Broadway Valdez District Specific Plan, adopted in 2014, has been a central part of attracting investors and developers to Oakland. The plan, which includes streetscape improvements that will make the district more pedestrian-and bike-friendly, gives developers expedited approval process for projects that included housing and retail.
Darrin Ranelletti, interim director of the Oakland Planning and Building Department, said that 20 projects have been built or proposed for the Broadway Valdez area, and that the number of housing units in the pipeline has grown faster than anticipated. So far 268 units have been completed in the district and an additional 1,102 are under construction in four projects, according to the city of Oakland.
“We are seeing less office development and more residential development than we expected,” he said.
In addition to 2302 Valdez St., the site of Friday’s fire, three other projects are under construction in the district: the 432-unit 3073 Broadway, the 224-unit 2400 Valdez St., and the 253-unit 2630 Broadway.
Scott Youdall, a partner with developer Hanover Co., which is building two projects close to the site of Friday’s fire, said: “There was no damage sustained to either of Hanover’s neighboring projects from the fire.
“We will be waiting to learn the facts of the investigation as to the cause,” he added.
While developers said the fires are “chilling,” they remain committed to building in the district. Peter Solar, a vice president with Alliance Residential Co., said his firm will break ground in a month on 2800 and 2820 Broadway, which will have 171 housing units in two buildings.
“We are concerned about the recent fires, and we are going to take every measure we can to prevent something like this from happening,” Solar said.
He called the development that burned Friday “very important” to the district.
Michael Ghielmetti, president of Signature Development Group, which has several projects planned for the district, said he will continue to build throughout Oakland. His company was responsible for the largest development in the district so far, 105 units at 2301 Broadway.
“Unfortunately, we are looking at adding to the cost of the project in the form of extra security,” Ghielmetti said. “We believe these last few fires were potentially intentionally set. There are too many similarities in circumstances — the time of night, the same time in the construction cycle.”
Holliday said that after the first fire on San Pablo Avenue, he added two armed guards and 12 security cameras — but it didn’t prevent the second fire.
“This is really bad for the Bay Area,” Holliday said. “I feel terrible for Wood Partners because I know what it feels like. It’s so hard to get a project approved and financed and built. When it burns down and you have to do it again, it’s brutal. It takes the wind out of you.”
The Alta Waverly building “represents the anchor building in what we call Oakland’s Miracle Quarter Mile,” said Greg McConnell, president of the Jobs and Housing Coalition, a pro-development group in Oakland.
“We must assure developers of these projects, and other projects throughout the city, that Oakland remains a safe place in which to invest and do business,” McConnell said. “Equally important, we must protect residents and businesses who live and operate near construction sites.”
Ranelletti of the building department said that it’s important not to overstate the impact of the fire.
“Every unit counts, but those other projects are continuing,” he said. “The Wood Partners project represents about 6 percent of the pipeline.”