Economic Revival To Transform West Oakland Historic Factory

West Oakland John Protopappas The Registry real estate 2

By Sharon Simonson

Oakland live-work developer John Protopappas and a team of investors have begun interior demolition and the seismic upgrade of a former General Electric manufacturing plant in West Oakland.

[contextly_sidebar id=”7a02b5f4bbf36460ae58a10ce8b2e4fc”]The 92-unit rental repositioning should transform the neighborhood, a rough-around-the-edges community with nascent signs of rebirth.

The location’s proximity to San Francisco’s thriving South of Market Street neighborhood via the Bay Bridge and the $800 a month difference in the neighborhoods’ apartment rents are driving investment. The Bay Bridge connects in Oakland blocks from the 1614 Campbell St. site.

Also propelling interest is gentrification around West Oakland’s 7th Street BART station, seven blocks south on Campbell from the project, where notable public art and streetscapes, restaurants and shops, including a 99 Cent Store, greet passengers.

“Here we are in West Oakland, and we are 15 minutes from where many of the jobs are being created, 15 minutes from SoMa and South of Market,” Protopappas said April 26 to a small gathering at the property, where redevelopment began in the last 14 days. “In many ways we are closer to the San Francisco Financial District than other parts of San Francisco.”

The $25.2 million project, slated to be leasing a year from now, represents the culmination of 26 years’ effort by Protopappas, first to buy the stately red brick, four-story buildings and then to gain the financing to renovate them. The deal depends on $4 million in federal tax credits granted by the National Park Service in recognition of their historic stature. One structure was erected in 1911, the second in 1917, though the two sections, set against one another in an L-shape, are indistinguishable. The factory was the first on the West Coast where women were allowed to work.

Protopappas described a series of small miracles that led to the project’s start, beginning in 1986 with his visit to the property with the former owner, Stanley Greitzer. He told Greitzer then that he would like to buy the buildings, but the deal became a sort of fine wine, only ripening in 2007—with Protopappas buying on the eve of the financial collapse. The property remained vacant for the next five-and-a-half years.

Protopappas is president and chief executive of Oakland-based Madison Park Financial Corp.

Most lenders he approached early in his pursuit of financing had redlined the neighborhood, said John Mix, managing director for Newmark Knight Frank Cornish & Carey Commercial Capital Group in San Francisco. Indeed, people young or old seeking “authenticity” in urban living will find it in West Oakland.

But, said Mix, “When I took on this project, I took long walks through this neighborhood and concluded that the worst part is this building. You can see it from BART; you can see it from [Interstate] 880. Just cleaning it up will affect blocks and blocks of surrounding properties.”

The project presents an unorthodox but perhaps instructive approach to financing difficult, risky but emotionally compelling redevelopments. The project’s architect, Toby Levy of Levy Design Partners, and its general contractor, Todd DiMartino of DCI Dettaglio Construction Inc., both are equity investors, as is the electrical contractor and several additional developers with live-work investment histories of their own.

East West Bank commanded $11 million in equity to match the $14.2 million loan, which is being syndicated. Fely Fernandez-Kwan, a senior vice president and group manager for Northern California Commercial Lending at East West, attended the project-start celebration. East West and Protoppapas have done other renovation work together including converting a former Sears department store into Oakland’s Telegraph Lofts and downtown Oakland’s signature Tribune Tower.

1  |  2  [btn link=”http://wp.me/p2egQr-2aC” target=””]NEXT PAGE[/btn]

West Coast Commercial Real Estate News