Uh-oh: Lennar’s $25 million shipyard funding gapSup. Chris Daly wants an immediate hearing into the fiscal health of Lennar’s construction project at Hunters Point Shipyard, (you know, the one where they repeatedly messed up the asbestos dust monitoring).
Daly made his request at the June 10 Board of Supervisors meeting, following the discovery that the San Francisco Redevelopment Agency has applied for, but has so far been denied, a $25 million grant to subsidize infrastructure costs at the site.
The agency filed its grant application with the California Department of Housing and Community Development in April 2008. During that same period, Lennar spent an estimated $5 million to successfully persuade voters to support Proposition G, which will allow Lennar to develop luxury condos at Candlestick Point, as well as at the Shipyard.
(At the last minute, Lennar appeared to sweeten Prop.G's terms, by negotiating a community benefits deal with the San Francisco Labor Council, including promises of 32 percent affordable housing and job creation investment. But tthe deal stretches the definition of "affordable" to way above what your average Bayview Hunters Point resident earns. And it only becomes legally binding, if, and when, something gets built at Candlestick/Hunters Point.)
Holding up a big fat binder, stufed with spreadsheets, financial data and grant applications, Daly read aloud to his fellow supervisors from documents that suggest that there is a serious financial shortfall at the Parcel A site, where Lennar graded an entire hillside in preparation for developing a 1,500 unit condominium complex.
“This raises questions about Parcel A and the mixed use project,” said Daly, citing from documnents that claim that the receipt of gap funding, "will restore the ability of the SFRA and the Developer to continue the development.g
As the agency's own grant application states, "The Gap Funding in the amount of $25,021,079 provided by the infill infrastructure grant will enable the San Francisco Redevelopment Agency and the land master developer to continue the development of the Shipyard.”
“The infill infrastructure grant will be instrumental in moving forward the Capital Improvement Project in light of exisiting market conditions and increased construction costs.”
“Without the receipt of the grant, it will face delays in the timing of the completion of the infrastructure and creation of much needed parks.”
Hmm.
Daly’s cache of documents also reveal that the Shipyard Legacy Fund has shrunk from $30 million to $5 million. This raises serious doubts about the City’s ability to deliver on a list of promised community benefits at the Shipyard.
According to the SFRA's own documents, "The Legacy fund is charged with reinvestment of the Agency’s proceeds from net land sales back into the BVHP community with an emphasis on employment, housing and financial/asset development, youth development, elder services, arts/culture & recreation and environment/safety."
Stay tuned.
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Comments (7)
There is a company profile that draws in part from the reporting done by the SFBG on CorpWatch's corporate malfeasance wiki, Crocodyl.
http://www.crocodyl.org/wiki/lennar_corporation
Posted by Crocodyl | June 11, 2008 01:55 AM
Baby Daly apparently has a big bowl of sour grapes.
Life goes on Daly, even when you dont get your way
Posted by Joe | June 11, 2008 09:45 AM
This gives me an idea: why not tie up this process in a bureaucratic morass long enough to let Junk Bond Lennar bleed a slow death before the first shovel of dirt can be tossed. It will be like that cockamamie Wi-Fi joke that Ichy was so fond of. Besides, there is certainly reason to hold up this project on ethical grounds. It only seems right.
Posted by expatriate | June 11, 2008 11:26 AM
Have you ever been to Bay View, something needs to change, and "holding this process up in Bureaucratic morass", is certainly not the ethical thing to do.
As for Lennar bleeding to death, it is very unlikely. They are a large well funded corporation and Junk status only tells us it is not suitable for Pension Plans, look at the interest rate they borrow at.
Posted by Chris P | June 11, 2008 11:45 AM
Chris Pee,
Are you trying to convince me or are you trying to convince yourself? The real estate market is going to get a hell of a lot worse before it gets better.
But I agree with you that something needs to change in BVHP -- that's why I supported the ethical Prop F and opposed the unethical Prop G.
Posted by expatriate | June 11, 2008 12:05 PM
I guess since I used a curse word when I posted here first i will used some modified words to say about the same thing I did before and maybe (?) it might get posted,
Laugh the F-ing Out Loud was my first reaction. How do the voters of San Francisco feel about being duped. Since people in the Mayors office and at Lennar already knew this information before June3rd.
Posted by Jerry Jarvis | June 11, 2008 02:53 PM
Poor cry baby Chris Daly - and of course the Guardian is right there carrying water for him!
It's good to see the sycophantic Guardian-Daly relationship completely restored!
Posted by Shane | June 11, 2008 04:15 PM