The Y factor

Is Mills Corp. using the YMCA as a beard for its waterfront mall?

By Steven T. Jones

Blasted by opponents as an illegal "megamall" and overwhelmingly rejected by the San Francisco Board of Supervisors, Mills Corp.'s Piers 27-31 project seemed to have just one thing going for it: a partnership with the universally beloved YMCA of San Francisco.

Now as Mills tries to move the project ahead – the company will likely get another chance to convince the supes early next year – questions are being raised about its relationship with the Y.

Sup. Tom Ammiano drew an interesting analogy during the hearing on Mills when he said, "The YMCA is being used as a beard."

The term beard refers to a woman that a closeted gay man would use as a date to public functions as cover for his homosexuality. So a beard is a deception or a false front. And in this case, Ammiano said Mills is using the YMCA as political cover to get what it really wants: a waterfront shopping center and office park.

Yet the hearing highlighted serious problems with Mills's beard, most important the fact that the YMCA hasn't yet raised any of the $30 million it had pledged for the project despite earlier promises by Mills that YMCA officials "have committed themselves to securing the gifts and pledge commitments totaling the full $30 million by Dec. 31, 2003."

YMCA president Chuck Collins acknowledged that the YMCA hasn't raised any money yet, but told the Bay Guardian, "Our funders are not interested in giving money to a project that is not yet entitled." Yet by then opponents fear the YMCA will have fulfilled its political role, leaving Mills free to exercise its right under its contract with the port to choose another recreation partner if the YMCA's fundraising efforts flag.

"It's become more of a concern that this is a bait and switch," said Jon Golinger of the opposition group Citizens to Save the Waterfront. Although the YMCA has never raised anywhere close to $30 million for any single project, Collins said he believes it's a reasonable goal.

In the meantime, Mills has guaranteed the port that it will fund the $30 million facility even if the YMCA is unable to raise the money. But that pledge raises a whole new set of questions that port officials are trying to get answers to, such as whether the YMCA would be liable for any funding shortfalls and how that might affect its operations.

Apparently the port is skeptical. In an Oct. 9 e-mail obtained by us under the Sunshine Ordinance, a port attorney asked Mills "to provide hard evidence and financial data showing" the YMCA's operations won't be hurt by its lack of fundraising.

That evidence wasn't provided, because of something that was dropped like a bombshell at the Oct. 18 board hearing: There is no written agreement between Mills and the YMCA – nothing spelling out the YMCA pledge or its terms – even though that's at the center of the argument for a project required by law to have recreational uses at its core.

"I was floored to find out the YMCA didn't have a signed contract with Mills," Sup. Michela Alioto-Pier, who served on the Port Commission during much of its negotiations with Mills, said at the hearing. "It's started to give me a lot of doubt about whether the YMCA is serious and really part of this project."

Both YMCA and Mills officials defend their arrangement as solid even if it isn't yet written down. "It's not like it won't happen; it's just that it hasn't happened yet," Mills spokesperson Dave D'Onofrio said after the hearing.

As for Collins – who himself is a former developer with WDG Ventures Inc., his projects including the Metreon entertainment complex – said he trusted Mills to do right by the YMCA: "I'm negotiating in good faith, and I assume all the other parties are negotiating in good faith."

Meanwhile, the YMCA is also making commitments to another developer that raise further questions about whether it will get anywhere close to its $30 million fundraising goal.

In August the YMCA announced that it was selling the Shih Yu-Lang Central YMCA, which has served the Tenderloin for almost 100 years, as well as two adjacent parking lots, to Oakland-based developer AF Evans for an undisclosed sum, which will be used to rebuild the facility on a site down the block that the YMCA hopes to buy.

Consistent with representations that Mills has made to the port, Collins told us both projects would be kept separate and that one would not affect the other. He also said the property sale won't completely cover the new construction costs, and the fundraising will be required at the same time they are raising money for the Mills project.

AF Evans president John Robertson said his company plans to convert the building into 192 low-income rental units and housing for the homeless – taking advantage of public subsidies to do so – and to build towers of 115 condominiums on the parking lots. While the condos won't be considered affordable, Robertson said his goal is to offer them for 10 to 20 percent below market rate.

Nonetheless, some YMCA members are angry with what they consider the organization's role in gentrifying downtown and taking on financial commitments that could hurt the organization. Central YMCA member Jeffrey Laffranchini wrote a letter arguing, "It is unrealistic to think that the YMCA will be able to raise the funds to finance a facility down on the waterfront when they can't maintain their existing buildings."

But Collins cautions against jumping to conclusions, saying that even though he's limited as to what he can say about both development deals, it's early in the process on both, and they know what they're doing: "One of the things we try to do in doing good work is to also be good businessmen."

E-mail Steven T. Jones at steve@sfbg.com.