The corporation that ate San Francisco

Lennar's failures at Hunters Point Shipyard highlight the risk of putting the Bay Area's prime real estate into the hands of profit-driven developers

For the past decade, Florida-based megadeveloper Lennar Corp. has been snatching up the rights to the Bay Area's former naval bases, those vast stretches of land that once housed the Pacific Fleet but are now home to rats, weeds, and in some places, low-income renters.

When the Navy pulled out of Hunters Point Shipyard in 1974, it left behind a landscape pitted with abandoned barracks, cracked runways, spooky radiation laboratories, antique cranes, rusting docks, and countless toxic spills.

A quarter century later, Lennar came knocking at the shipyard's door — and those of other military bases abandoned in the waning days of the cold war — recognizing these toxic wastelands as the last frontier of underdeveloped land in urban American and an unparalleled opportunity to make big money.

Lennar had already won its first battle in 1997, seizing control of the Bay Area's former military pearl in Vallejo when it was named master developer for the old Mare Island Naval Shipyard. Two years later it almost lost its bid for Hunters Point Shipyard when a consultant for the San Francisco Redevelopment Agency recommended giving the development rights to the Ohio-based Forest City.

Lennar fought back, calling on politically connected friends and citing its deep pockets and its track record at Mare Island.

A parade of Lennar supporters, many of them friends of then-mayor Willie Brown and Rep. Nancy Pelosi, told the Redevelopment Agency commissioners that Lennar was the only developer that had bothered to reach out to the Bayview–Hunters Point community. In the end, the commissioners — all of them mayoral appointees — ignored their consultant's advice and voted for Lennar.

Nobody knows if Forest City would have done a better job. A developer is, after all, a developer. But Lennar's victory at the shipyard helped it win the rights, four years later, to redevelop Treasure Island — long before it had even broken ground at Hunters Point. And a couple years ago, it parlayed those footholds into an exclusive development agreement for Candlestick Point.

Now the Fortune 500 company, which had revenues of $16.3 billion in 2006, does have a track record at the shipyard. And that performance is raising doubts about whether San Francisco should have entrusted almost its entire undeveloped coastline to a profit-driven corporation that is proving difficult to regulate or hold accountable for its actions.

Sure, Lennar has provided job training for southeast San Francisco residents, set up small-business assistance and community builder programs, and invested $75 million in the first phase of development. That's the good news.

But on Lennar's watch, a subcontractor failed to monitor and control dangerous asbestos dust next to a school at the Hunters Point Shipyard, potentially exposing students to a deadly toxin — despite promising to carefully monitor the air and control the construction dust.

And when the homebuilding industry took a nosedive last year, Lennar reneged on its promise to provide needed rental housing on Hunters Point — saying that its profit margins were no longer good enough to make rentals worthwhile. All of which raises questions about whether this company, which is working with Mayor Gavin Newsom to build a stadium at the shipyard to keep the 49ers in town, really has San Francisco's interests in mind.

Bayview–Hunters Point native Dr.