Death of Oakland's Retail Plan 

Oakland loses a $1 billion a year to other cities, and without redevelopment, the city's plans for a major shopping district in Upper Broadway may be history.

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Nora Davis, a councilwoman who first took office in 1988, said that voters in the late Eighties understood how important it was to adapt to the loss of the city's heavy industry. She worked with two other councilmembers and ran on a platform to fundamentally transform the city's economic base. "It was a conscious design to develop a mixed-use city," Davis said, "and no way in the world could we have done it without redevelopment money."

Redevelopment funds were particularly pivotal in helping Emeryville focus on retail. Redevelopment dollars, for example, paved the way for the East Bay Bridge shopping center, which attracted major retailers like Home Depot, Office Max, and Pak n Save, as well as IKEA, five large hotels, and Bay Street, Emeryville's incarnation of Berkeley's Fourth Street upscale shopping district.

Although Emeryville arguably sacrificed the opportunity to develop an identity like its neighbors and instead became a shopping mall mecca, it managed to successfully avoid financial ruin while building a strong tax base at the same time. And if it weren't for redevelopment money, it's unlikely that Emeryville would have been able to accomplish what it did in such a short period, said Josh Simon, president of the Emeryville school district Board of Trustees. The elimination of redevelopment, Simon said, will be particularly harmful for "communities like Emeryville that are transitioning from industrial to an office/retail economy."

Oakland, by contrast, failed to use redevelopment funds to build one or more major retail destinations in the city before redevelopment was eliminated. Instead, the city, under then Mayor Brown, focused much of its energy into revitalizing Jack London Square, downtown, and Uptown. Under his 10k Plan, Brown used redevelopment cash to fix up and reopen the Fox Theater and attract developers with enticing deals to build apartments, catalyzing the development of what is now a thriving arts and entertainment scene.

But with at least 14.5 percent of its workforce unemployed as of last November, Oakland still has the highest percentage of jobless residents in the area.

Designed in part to replace the city's decaying Auto Row, the Broadway-Valdez project was to be behemoth in scale and scope. It called for close to a million square feet of retail and commercial office space in the Valdez Triangle, with room for hotels and 900 to 1,800 units of housing.

But without redevelopment, such grandiose plans may be now impossible. Redevelopment, for example, allows cities to combine disparate plots of land into one large plot that could then be handed over to private developers, either for free or at a reduced cost. The Broadway-Valdez project, as it was envisioned, would have required such "land assembly."

The lack of redevelopment also will make it much harder for the city to attract capital investment in the Upper Broadway area, because investors may be concerned about not making profits down the road, said Larry Rosenthal, assistant adjunct professor at UC Berkeley's Goldman School of Public Policy. He added that when the economy picks up, retailers will be more attracted to areas where there is already a vibrant, bustling commercial district. "It is correct to look at this shift as profound and an extremely harmful change for revitalization of depressed urban areas," he said of the end of redevelopment.

Then there's infrastructure. Simply put, redevelopment money helped subsidize the construction of sidewalks, bike lanes, and other improvements that are more likely to make a project feel like a "destination," Angstadt explained. The Broadway-Valdez project called for significant infrastructure developments, including bike lanes, expanded sidewalks, and parking.

Angstadt noted that the loss of redevelopment also hampers other enticements that the city has used to attract businesses — large and small. For example, facade improvement grants, money used to make the outside of small businesses look fresh and clean, have been wiped out. Tenant improvement programs, which assisted local businesses that need cash to spice up their locations, also are now gone. In short, the elimination of redevelopment will not only make it very difficult for the city to bring in large retailers, but it also will be an obstacle for attracting mom-and-pop stores. "The elimination of redevelopment is not going to be good for small business, probably the reverse," Angstadt noted.

So what will Oakland do? One way around the redevelopment problem, Angstadt said, may be to hard-wire entitlements into development proposals, essentially packaging pre-approved perks and conditions, such as cutting through bureaucratic red tape, in order to slash the costs of opening a major retail center, or even a small store. "That becomes one of our bigger developer incentives once redevelopment disappears," Angstadt said.

But while the city figures out how to incentivize development in the Valdez Triangle without redevelopment dollars, artists and business owners are already plotting their own organic course that would fuse Uptown with Auto Row.

The onset of the Great Recession hit the Valdez Triangle hard. Auto Row lost dealerships, but the area has since started to experience a renaissance as entrepreneurs, artists, and restaurateurs open shops in the area.

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