Why Developers Love Oakland
Junction Properties owner Charles Long likes Oakland a lot. Oakland provides residents an escape from the supply-constrained rents in San Francisco, while offering plenty of recreational options.
“Oakland has buzz,” Long said. “It is a place with great restaurants and great entertainment and nice walkability.”
Oakland also offers a better quality of life with many recreation choices via the expansive East Bay Recreational Park District compared to what is available in San Francisco and the peninsula, according to Long. The city also has Lake Merritt and the Paramount and Fox theaters.
Oakland offers a more affordable place for companies to rent space, and demand is rising. Oakland’s office rents have risen almost 50% within the last two years, according to Long, though they still remain below San Francisco rents.
There has been increased demand from companies leaving San Francisco to escape the $75/SF rents. Oakland offers rents in the mid-$50s/SF, according to Long. Blue Shield will move 1,200 workers to downtown Oakland into a new building to be built by Shorenstein and MetLife.
With more people working in Oakland, housing will become an even greater need for the city. Change has been underway ever since then-Oakland Mayor Jerry Brown proposed the city build 10,000 housing units, which has helped make downtown Oakland more populated, Long said.
“I think city leadership is really focused on capitalizing on Oakland’s strengths and basically continuing to attract people to live here and to genuinely revitalize the downtown area as great place to live and work,” Long said.
Oakland’s entitlement process is rational as opposed to San Francisco’s process, which can be completely dysfunctional, he said. Developers can come into Oakland and have some assurance that zoning and general plan conditions will be respected in the final entitlement stages.
Junction Properties will add two housing projects totaling 175 units to the Uptown area of Oakland. The project at 471 26th St., a former truck parking lot, will be a 97-unit apartment community with 9,700 SF of retail. The site had previously been entitled, but with a design of steel and concrete that was not economically viable. Junction Properties changed the design to be built from wood over a concrete podium and a reduced height to better fit within the area.
For this project, Junction Properties is working with a group of artists and makers to designate the area between Telegraph, Broadway and Grand as an arts district. Long said creating an arts district is another way the city and developers can create a place for artists and makers to connect with a community.
“We’re not looking for a commodity development, but a development that honors its heritage,” Long said.
Junction Properties’ other project, at 570 21st St., does just that. The project will involve relocating two historic houses built in 1890. The houses will shift 50 feet to the west so they can remain in the Cathedral Historic District and will be brought up to code. The Moran is named after the property’s original owner, Rosa Moran, who died in 2016.
The developer will build 78 apartments in a five-story wood-frame building over a concrete podium. The project will offer studios, one-bedroom and two-bedroom units. The building will be a block away from Uber’s future Oakland office.
Find out more about Junction Properties' projects during Bisnow's Oakland Multifamily & Mixed-Use Rise and Expansion event May 9.