Wednesday, May 22, 2013

As Time Runs Out, Council Gives Oakland Army Base Tenants A Reprieve

Oakland Army Base from the sky.
OAKLAND CITY COUNCIL | A few businesses at the Oakland Army Base will not face imminent eviction in advance of a planned $270 million makeover of the waterfront. The Oakland City Council Tuesday directed its real estate manager to not issue unlawful detainers against tenants during a 15-day period starting June 1.

However, time is of the essence, says the city. If the land at the Oakland Army Base is not prepared for redevelopment by September, it risks losing $176 million in federal grants. While some tenants have found refuge at new locations at the Port of Oakland, some have not and the back-and-forth has been divisive over the past six months or more.

Council President Pat Kernighan, though, said tenants at the base have been aware of their temporary status for, at least, the last nine years. “It’s not quite the simple good guy, bad guy thing,” says Kernighan. “We’re looking for win-win for everyone, but it is not simple.”

A 200,000 square foot plot of land at the Port of Oakland called “The Notch” is a possible landing spot for some of the remaining businesses, but one, OMSS, a trucking company owned by businessman Bill Aboudi, is still facing problem striking a deal with the Port.

Last month, the city offered the Port a contract giving OMSS five acres on a month-by-month basis. The Port, however, declined the offer, said John Monetta, the project's real estate manager. A similar proposal is on the Port’s June 13 agenda slated for approval. “We have to sign this,” said Aboudi. “We have no choice.”

Despite the frenzy of last minute deals, the time frame for clearing the base is extremely tight, says Monetta. A sentiment also espoused by Councilmember Lynette Gibson McElhaney, who represents the waterfront on the council. “Time, Mr. Monetta, is not our friend. I understand that,” she said.

Monetta said without the potential use of legal strategies to evict the tenants in such a short time frame, inaction poses a great threat to the entire project. He argued, at this late date, repossessing a property could take up to two months to secure. In addition, any personal property left behind by former tenants could add another three weeks to notify and potentially auction off property. In total, such delays run smack up against the Sept. 1 deadline, says Monetta.

“This is a really important to me and this is my baby and I do intend to give birth to her in a grand fashion,” said Gibson McElhaney, who has received plaudits for her work of late in moving together warring stakeholders at the base. On Tuesday night, she cited Oakland’s struggling business community crave certainty and clarity from the council. “Folks are paying attention to what we’re doing on this dais,” she said.

But, just as a comity appeared to come forth on the issue, the nagging questions of transparency over the Oakland Army Base persists. A legal opinion issued earlier in the day by Oakland City Attorney Barbara Parker found the project’s developing firm led by Oakland businessman Phil Tagami and a panoply of his companies had, indeed, possessed a business license when he made the deal for base in 2010. Question over the legality of the 2010 agreement for the base had been nagging.

However, Parker’s office found, not all of the subsidiaries had, at least, until this month. The city’s tax revenue office showed Prologis/CCIG and Oakland Global LLC did not possess tax certificates when the Lease Disposition and Development Agreement (LDDA) was signed by the Tagami group, but such an occurrence would not invalidate the deal, according to Parker’s legal opinion.

Councilmember Desley Brooks reiterated a common complaint made by detractors of Tagami, one of the most powerful developers in the city and the Oakland Army Base project as a whole. “It is problematic that the developer is also the property manager because they have a vested interest,” said Brooks.

Although seven council members agreed with Gibson McElhaney’s motion for leniency against the army base tenants, Kernighan chose to abstain, saying only, “There’s thing I may not know.”


  1. When is the city council going to admit their huge mistake in giving this project to Tagami and reverse their decision? He has done two highly visible Oakland projects - Rotunda and Fox Theater that, although they have added to downtown ambience - they have done so at much more expense to Oakland than warranted. Neither of these projects were done according to a sound business model and both ended up costing the city a lot more than they would have if done as a private development deal.

    Now they have essentially given him a billion dollar project for nothing (did he finally give city staff permission to cash his $50,000 check??.

    Phil's attorneys are slick enough to avoid anyone yet casting this as a gift of public funds, and the Mayor and Council have rolled over and ceeded all control to him. Nevertheless, their actions (or lack thereof)border on criminal.

    When will prople wake up and rectify this travesty that will cost Oakland big time in the future??? City leaders are afraid that they will lose the state money (which they still may or may not get). However, if past history is an indication, we may lose much more when Phil has to again be bailed out by the city as he has on the Fox Theater and Rotunda.

  2. This comment has been removed by the author.