Alameda points to Chinese investment
Updated: 2012-09-14 11:05
By Chen Jia in Alameda (China Daily)
One local councilmember candidate in Alameda looks to secure a joint venture for its long-stagnant development. Alameda is faced with multi-million-dollar budget deficits over the next five that could bankrupt it of major changes are not made. Chen Gang / China News Agency
Chinese investments have played many roles in the US - and, if one enterprising candidate has his way, they are about to become a selling point for his election campaign.
Alameda Point, a former US naval air station in northern California, is looking to lure Chinese investors and developers to kickstart its seemingly stagnant economy, according to Stewart Chen, a chiropractor who will run for a spot on the Alameda City Council in November's elections.
"If China is willing to work with us, this is probably the last major piece of property in northern California that can be developed," he said.
Chen was born in the Philippines and migrated to the US when he was a teenager. As he is a third-generation descendant of a Chinese family from Xiamen, a major city on the southeast coast of China, he is fluent in Mandarin, Cantonese and Hokkien.
"In the past 10 years, China has focused a lot on solar power, high-tech industries and environmentally friendly technology, so we can do exchanges in trade, technology and business development," he told China Daily.
Alameda is an island city and is adjacent to Oakland, overlooking San Francisco Bay. Alameda Point is at the west end of Alameda Island. When the US Navy pulled out 15 years ago, they gave up 918 acres of land that the city can use for business development. Development battles over Alameda Point began around the time the last Navy ship set sail in 1997. Funding problems, the fluctuating real-estate market and the city's multi-unit housing ban have prevented any project from moving forward.
The latest developer to tackle Alameda Point was SunCal, based in Irvine, which submitted plans to the city in 2008 calling for 4,500 units of housing, two schools, a library, 145 acres of open space, a 58-acre sports field complex, 15 miles of bike paths, a ferry terminal and other amenities, according to local media. But the company pulled out due to conflicts with the city over how the housing units could be built, according to Chen.
Despite the previous failures, he believes that if China comes in and helps to develop Alameda Point, "it can be another Silicon Valley and a free-trade zone".
It is not the first US city to wave an olive branch in the direction of China, hoping for a joint effort to convert the land into a commercial development.
Reports from earlier this year indicate that leading US real-estate company Lennar Corp had been in talks with the China Development Bank regarding a $1.7 billion investment to restart two projects that would transform two former naval bases in San Francisco, Treasure Island and Hunters Point, into large-scale housing.
If completed, the deal would mean a US company had turned to China for help funding a long-delayed and partially publicly funded project that would otherwise remain incomplete, reflecting a changing dynamic between the two economies.
"For Alameda point, we are also talking about billions of dollars to develop the 918 acres of land. With the current financial constraints, not a lot of American developers can put up that kind of money," Chen said.
Alameda is faced with multi-million-dollar budget deficits over the next five years that could bankrupt it if major changes are not made, according to the city's top financial officers. "Development in the Bay Area is difficult. Special-interest groups will oppose most projects, so it takes great care and persistence to get a major project approved," UC Berkeley law professor Robert Berring told China Daily.
"If the right factors could be arranged, however, this would be a great chance for Chinese investors to begin to participate in large-scale public projects in the United States," he said. Though the Bay Area is bristly with politics, it is also more open to working with China, Berring added. "Chinese investors need to tap the market, and this could be good for both sides." Liana Rodegard, the administrative assistant of M+W Group, said the company had halved their rent by moving from downtown San Francisco.
"When I tell people we moved to Alameda, many of them say they had never heard about the city," she said.
"I hope Chinese developers are interested in the land, as their investment could be a boom for the local economy and make the city more famous both nationally and internationally."
Rodegard expects that such a development would bring her company more business and clients in the fields of architecture and engineering.
Mario Prado, a local garden worker, said he expects Chinese investors to develop the land because it will bring more jobs.
Insiders also said what Chen is doing, with a "good sense of time and history", will be helpful for his election campaign.
"If I win the campaign in November, I would have a better position and platform to get to China for a potential partnership for the development of Alameda Point," Chen said.
He has visited Alameda's sister cities Shanghai, Wuxi and Dalian several times over the past 10 years, and learned how to communicate with Chinese officials and businesspeople.
"You can have all the talent in the world, you can be distinguished in business, but you cannot bridge the gap if you don't have guanxi (social connections)," he said.
"Guanxi is basically the driving force for China. You have to have that connection. It's a tool that officials can use when we come back from China and bring in potential partners."
Alameda will work with China to streamline cultural differences and business practices, Chen said. He also noted Chinese developers have to understand they need to work with the Environmental Protection Agency (EPA) as well as the US Navy to clean up some of the waste left in Alameda Point.
"The bulk of the responsibility is with the US Navy and EPA, but we expect certain responsibilities from the developer," he said.