According to the announcement, “Alameda Point Partners (“APP”), the developer for Site A at Alameda Point, and the City of Alameda today announced they will work collaboratively over the coming months to help move the Site A development forward.”
The site is slated for 800 new residential units, a new ferry terminal, 600,000 square feet of commercial and retail space, upgrade streets and infrastructure, and over 15 acres of public parkland.
Alameda Point Partners is developing a “plan to minimize economic uncertainty.” Rising construction costs have prevented the developer from finalizing its development budget and completing financing in order to accept conveyance of the site, which was slated for earlier this week, April 11th.
The developer proposed today to complete an amended plan within six months that would compress construction phases and deliver more housing.
Technically, the developer is in default of its agreement with the City of Alameda, a matter that city officials attribute to “economic uncertainty stemming from the extraordinary escalation of construction costs since the original execution of the Disposition and Development Agreement (DDA) in August 2015, without a parallel increase in projected revenue. The resulting negative impact on land value created significant risk that the project’s proceeds will not cover the cost of the infrastructure.”
Alameda Point Partners has also proposed making an extension payment to the City of Alameda that will ultimately be credited toward the developer’s obligation to fund a portion of the new Seaplane Lagoon ferry terminal, along with a reimbursement payment to the city for its transaction costs related to this delay.
The developer also has to complete its financing plan and ratify agreements with a townhome builder by June of this year.
“The delay we are experiencing today is a result of changes in the market that include dramatically increasing construction costs,” explained Bruce Dorfman, Managing Partner of APP. “We are pleased to be in partnership with the City of Alameda and will continue to work with them to implement an incomparable development plan in spite of the challenging economic environment.”
Alameda Point Partners has invested $15 million in the project so far.