Oakland developer seeks Chinese investors to fund 250 units of new housing
Sunfield Development LLC is hoping to attract nearly a hundred foreign investors through the EB-5 program to partially fund a new housing project at 1800 San Pablo Ave. in Oakland.
The Oakland-based developer has filed a preliminary application with the city for 250 residential units and 25,000 square feet of commercial space at the site, which is near the Fox Theater and 19th Street BART station. Sunfield is looking to raise $45 million through the EB-5 program for the estimated $124 million project, said Sid Afshar, the company's founder.
Foreign investors who invest at least $500,000 and create 10 local jobs in the U.S. can get a permanent visa in about two years through the EB-5 program. The program has grown in popularity as a way for real estate developers to fund projects around the country as financing became more scarce after the 2008 recession.
EB-5 is also funding Tom Henderson's Callsocket call center and other businesses in Oakland. It hasn't yet been used for new construction in the city, but Afshar believes that will change. "We're one of the first ones with EB-5, but we won't be the last," he said. "As Oakland goes through a renaissance, there will be more."
In San Francisco, Lennar Urban's Shipyard project and the Kor Group's renovation of the Renoir Hotel are also using EB-5.
Chinese investors have been the vast majority of EB-5 investors, and Afshar also runs the California Pacific Regional Center, which is seeking foreign investors for the housing project. No investors have committed yet, and Afshar is also working with a referral company in China.
In order to raise $45 million, Afshar would have to secure 90 investors and create at least 900 jobs lasting at least 24 months, but these could include temporary construction jobs and "indirect jobs" created by generating economic activity in the nearby area.At 1800 San Pablo Ave., Sunfield has agreed to provide 15 percent affordable housing, or around 32 units. Six percent of the units would be designated for residents making no more than 80 percent of the area median income and 9 percent of the units would be for residents making no more than 50 percent of the area median income, said Afshar. The developer is also finalizing a project labor agreement, which usually requires local and union construction workers for a project.
The project will initially be a rental but could eventually be converted to condo, said Afshar. Plans for the project date back to at least 2010, but development was delayed after the dissolution of redevelopment agencies, which previously controlled the land.
Oakland-based JRDV Architects is designing the project, which Afshar hopes to open by 2018. The city and developer are now working on a draft environmental impact analysis, said Mike Rivera, the Oakland planner handling the project.
Afshar and California Pacific Regional Center are also working with six Chinese investors who have filed applications with the federal government to open two urgent care medical centers in Oakland next year.
Sunfield is also working on two other commercial developments in Oakland, but those projects are too small to be funded by EB-5, said Afshar.
One is a mixed-use project at the intersection of MacArthur Boulevard, Foothill Boulevard and 73rd Avenue, across the street from the Eastmont Mall. The project will have ground-floor retail and likely around 60 to 120 units of housing, which could be senior, affordable or market-rate units, said Afshar, who is still considering different development options.
Sunfield is also selecting a contractor to begin construction on a $10 million retail project at 5859 Foothill Blvd. in East Oakland. The developer is receiving $14 million in tax subsidies for the project.
Walgreens is leasing about half of the 27,000-square-foot project, and other tenants will include UPS, Subway and T-Mobile. Sunfield has around 10,000 square feet remaining and is in talks with Chick-fil-A. The asking rent is around $24 per square foot.
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