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Port unveils Pier 70 term sheet with Forest City; artists and neighbors press for inclusion and preservation
Summary
Staff and Forest City presented a term sheet for a 28-acre Pier 70 waterfront development that would rehabilitate historic buildings, create offices, retail and up to 950 residences and rely heavily on phased infrastructure financing; artist tenants objected to plans to remove the Newnan Building and asked for meaningful inclusion.
Port staff and master-developer Forest City presented a detailed term sheet May 16 for the Pier 70 waterfront site that lays out land-use goals, phasing and a financing approach intended to deliver large-scale horizontal infrastructure and historic rehabilitation.
The term sheet covers a 28-acre waterfront site and anticipates up to 3.5 million gross square feet of development including as much as 2.2 million square feet of office, roughly 270,000'400,000 square feet of retail/arts/maker space, approximately 950 residential units and 7'8 acres of public open space. Staff described entitlement and infrastructure costs at scale: entitlement costs estimated at roughly $21 million, infrastructure development at about $155 million and historic rehabilitation work on three buildings estimated at approximately $90 million.
Under the proposed deal structure Forest City would invest developer capital to build horizontal infrastructure and would receive reimbursement plus an 18 percent return; after that return the arrangement would split remaining project revenues (55 percent to the Port, 45 percent to Forest City). The Port would also receive ongoing participation: 1.5 percent of modified gross revenues from development leases after year 30 (rising to 2.5 percent by year 60), 9 percent of IFD tax-increment proceeds for the Port and a share of refinancing or sale proceeds. Forest City would take phased option rights to development parcels with appraisal-based valuation used at lease execution.
Several speakers from the Newnan Building artists' community urged that the building be retained, that artist tenants be included in the planning, or that Forest City make explicit commitments to preserve affordable studio space. "We object to approving any plans that propose the demolition of Building Number 11 without research, justification or clarification of the living resource that it is," Kim Austin of the Newnan Building told commissioners.
Forest City and Port staff said they had undertaken outreach and would continue to refine the program; Forest City representatives said they'd included cultural and "place-making" uses and aimed to create flexible spaces for arts and maker uses, but acknowledged the Newnan Building question requires further conversation.
Next steps: staff plans to return on May 28 with the term-sheet item for possible endorsement by the Commission and then to the Board of Supervisors. If endorsed, the project would enter a multi-year CEQA/rezoning and public-trust exchange process; phased development is likely to begin after entitlements, possibly around 2016 under staff's timeline.
The Port stressed phasing, public benefits and use of infrastructure financing districts to limit near-term port capital burden while funding significant public improvements.
