Community members are raising questions about whether Mayor Libby Schaaf’s $600 million infrastructure bond, which will be on the ballot in November, will be used to enhance streets, sidewalks, lighting and sewers in flatland neighborhoods or if the money will be diverted to support major development projects that are unable to secure their own funding.
One of the projects being questioned is the renovation of the Henry J. Kaiser Center, a project that Orton Development has an Exclusive Negotiating Agreement (ENA) with the city to build for an estimated $52 million.
Under the ENA, which lasts about another six months, the developer’s proposal is not yet finalized and requires additional public hearings and design review.
Orton’s plan, which is in accord with the city’s requirements, features refurbishing the Calvin Simmons Theater as a performance and practice space. The other end of the building, a 6,000-seat venue, would be turned into a retail and market-rate office space that would mostly be rented to arts organizations.
According to Karen Boyd, Oakland Citywide Communications Director, Orton Development will be able to pay for the project from its own capital and loans and therefore does not need public money.
“Orton is not dependent on an external capital investor, as many developers are, because they are well capitalized,” said Boyd.
“Orton will be able to fund the project through a mix of their own equity, a conventional bank loan, as well as Federal Historic Tax Credits and possibly New Market Tax Credits.
“The city may commit $3 million in former redevelopment bond funds to the restoration of the Calvin Simmons Performing Arts Theater, which had been previously identified as a source of funding for this building,” she said.
There are ongoing discussions over a long-term lease of the renovated property to Orton, which the company will use to repay its investment.
“The city and Orton have been at the negotiating table over the last few months, negotiating long-term lease deal terms for consideration by the City Council later this year.”
In an interview with the Post, Nick Orton of Orton Development said, “We do not typically use outside capital partners for our projects, including our Ford Point project in Richmond and Pier 70 in SF. We have enough capital ourselves to provide the equity for the Oakland Civic project and do not plan on bringing on a private equity partner.”