City of Hayward Embarks on Quest to Redevelop Caltrans State Route 238 Corridor Lands

Hayward, Caltrans, Alameda, BART, Hayward High School, CSU East Bay, William Lyon Home, Newport Beach, Hayward Golf Course, Mission Hills
Image Credit: City of Hayward

By Meghan Hall

Efforts by the City of Hayward, Calif., to develop ten parcels along State Route 238 are well underway, as the city conducted its first of several community outreach meetings just before Thanksgiving in 2018. The city is working to efficiently decide the future of the nearly 100 acres of land, whose fate has been in linbo for nearly forty years as Caltrans struggled to get its State Route 238 Bypass project off of the ground.

“The biggest motivation is really to have more control over what can be developed there and work closely with our community to make sure that what is built is consistent with the community’s vision for that land,” explained Jennifer Ott, the Deputy City Manager for Hayward.

The ten parcels the city is evaluating are just a small fraction of the more than 400 properties purchased by Caltrans in the 1960s for the State Route 238 Bypass project, which was meant to stretch more than 14 miles through Hayward and parts of unincorporated Alameda County. In 1971, as Caltrans planned to move forward with the project, a lawsuit was filed in federal court on behalf of the residents who would be displaced by the freeway, and it effectively blocked the project.

In 2009, Caltrans officially abandoned its plans to carry out the State Route 238 Bypass development after then-governor Arnold Schwarzenegger directed Caltrans to sell all property not required for existing LATIP projects. In 2016, the city, wanting more say in the development of the properties, purchased the ten parcels of land from Caltrans; Hayward has until 2022 to resell the property to developers. The ten parcels are located primarily along Foothill and Mission Blvds., near the Hayward BART Station, Hayward High School and CSU East Bay.

“Having control over ownership of the land would put us in a much better position to make sure the city received public benefits from the development,” said Ott.

With its enhanced control over the properties, the City will require the parcels to be developed and prevent the new owners from reselling them for speculative purposes. The City will also spearhead the public input process and ensure the completion of infrastructure improvements and public works projects such as expanding the Hayward Foothill Trail, public transportation and open space maintenance on behalf of Hayward residents. Other potential benefits, according to Ott, include affordable housing, commercial spaces and neighborhood parks.

The City expects that the sales price of each parcel will exceed the amount they paid to Caltrans, in which case the city will keep the excess proceeds to fund public benefits. So far, however, only Parcels One and Ten have been sold. Both parcels were purchased by William Lyon Homes for $31 million. The Newport Beach, Calif., developer plans to build 472 market rate and affordable condominium units, apartments and 20,000 square feet of commercial space. A 2.4-acre park is also included in the plans. The parcels are located on either side of Mission Boulevard, just adjacent to the Mission Hills of Hayward Golf Course.

Ott says Parcels Two through Seven are under negotiation and are closer to being in contract, while Parcels Five through Nine are still in the pre-planning phases. A charter school could be part of the plans for Parcel Three, while a new auto dealership is in the works for Parcel Seven. Ott says that because each property is so different, city officials are pursuing different master site plans for each individual parcel.

“Each piece of property is different, and we have a lot of goals that we’re hoping to achieve as we move forward,” said Ott. “Each parcel kind of speaks to a different opportunity.”

During November’s community meeting, members of the Hayward community voiced that they loved Hayward’s open spaces and access to the outdoors while emphasizing concerns about increasing traffic and density in the area. Ott said that the City is still processing the public’s more detailed feedback, which will be incorporated within the parcels’ master site plans. Ott said the timeline is not set, but believes that a draft master site plan will be ready to go early 2019. A second community meeting will be held to garner input on the plans, which will be updated according to community, investor and stakeholder feedback.

“It depends on how smoothly it all goes,” said Ott. “I think our hope is by mid-summer of next year we’ve gotten the council on board, and we’ve adopted or approved these master site plans.”

After the plans are approved, Ott said the city will release Requests for Proposals (RFPs) for the parcels. Once developers are chosen, it could take two to three years to finalize transaction documents and begin construction on the properties. As the planning process continues, city officials are happy they are able to incorporate public input.

“I think we’re just excited, and we see it as a real opportunity for the citizens of Hayward and the County, because they can have a greater voice in how the parcels are developed,” said Ott. “There’s an opportunity to really leverage the properties for public benefit.”