21st Century Treasure Island

By Wes Starratt, PE

In the Military Base Conversion & Realignment Program of 1993, the US Congress and the President slated Naval Station Treasure Island, along with numerous other military bases throughout the country and the Bay Area, for closure. Early on, the US Dept. of Defense designated The City and County of San Francisco as the Local Base Reuse Authority, responsible for the conversion of the base to civilian use. The Navy Base property involves not only the 403-acre man-made Treasure Island (TI) with approximately 2.5 million square feet of non-residential buildings and 1,000 family housing units, but also the 32.5-acre northern half of Yerba Buena Island (YBI) and its historic structures.

Now, more than 13 years later, the base is still in the hands of the US Navy, and reuse plans are still being developed. Yes, the base reuse program is a long and complex process, but Treasure Island is particularly complex and costly, because of a number of factors, especially the vulnerability of the exposed man-made island to serious damage from storms and earthquakes.

As a consequence, in order to reuse the island, substantial costs are required to strengthen the island, the breakwater surrounding the island, as well as the causeway connecting it with Yerba Buena Island (YBI). Added are the costs for the demolition of buildings, upgrading the utilities and providing an adequate transportation system for the island. There are also problems involving the potential jurisdiction of the California Tidelands Trust over the island and a Federal Jobs Corps installation planted in the middle of the proposed redevelopment area. To further complicate matters, Federal funding of the reuse process, other than the cleanup of some minor toxic problems on the island, has been almost non-existent. The result is that a very big, costly and complex reuse program was dumped into the laps of San Francisco’s city fathers. No wonder the redevelopment program for Treasure Island is taking so long.

Initially, reuse concepts ranging from a Nevada-type casino to a horse race track and a golf course were discussed in the press and on the street. Everyone wondered what to do with this flat island in the middle of the Bay with its magnificent views of The City, but with its exposure to wind and storms sweeping through the Golden Gate. Few realized that the island had a much more serious problem, namely that it is expected to perform poorly in … a major earthquake on a nearby portion of the San Andreas or the Hayward faults. (as reported in the Naval Station TI Reuse Plan).

The man-made island had existed since 1937 without encountering a strong temblor until 1989 when it was struck by the Loma Prieta Earthquake, which, as we learned our preceding article, caused … soil liquefaction over most of the island … surface settlements of up to 12 inches … numerous pipe breaks … and settlement of the levees surround the island. And that was for a moderately-strong earthquake of short duration at an epicenter near Santa Cruz, 60 miles away. So, one must ask: How would the island withstand a longer and stronger earthquake on a nearby fault? The answer is: Not very well, without substantial strengthening.

The first organized attempt at base reuse planning for TI was undertaken by The City and County of San Francisco through its Office of Military Base Conversion, under the direction of a Citizen Reuse Committee appointed by the mayor. A Draft Reuse Plan was developed by this group, in collaboration with a top-notch planning and consulting team headed by the ROMA Design Group and a comprising a team of architects, engineers, planners and other experts.

The initial reuse plan went through several stages of review by The City’s Planning Department and the Redevelopment Agency, together, with a host of consultants and contractors. Finally, the Naval Station Treasure Island Reuse Plan was completed and endorsed by the San Francisco Board of Supervisors in 1996. The Reuse Plan laid out general policies and implementation strategies but did not provide detailed redevelopment concepts.

Following its endorsement of the reuse plan, The City called upon the venerable Urban Land Institute (ULI) for advice and guidance on how it should proceed with the complex and involved process of transforming the island into a vibrant part of The City of San Francisco. The institute has a track record of successfully guiding the City of Vallejo and numerous other communities across the country in the complex base-reuse process.

We called upon Jack Sylvan, TI Project Manager for the Mayor’s Office of Base Reuse & Development, for help in understanding the complex base-reuse process. He explained that the ULI recommended that The City treat Naval Station Treasure Island as a redevelopment project and create the equivalent of a redevelopment agency, specifically, to administer that project. Based on that recommendation, the Board of Supervisors approved the formation of the Treasure Island Development Authority (TIDA), which was formally established by state legislation in 1997. All seven members of TIDA’s board are appointed by the mayor, with certain seats approved by the Board of Supervisors.

In the meantime, Naval Station TI, which was originally scheduled to close in Sept. 1997 and be transferred to The City and County of San Francisco, has remained in the hands of the US Navy, and is expected to remain so, until the final reuse plan has been approved and presented to the Navy for its agreement several years from now. Meantime, the Navy has negotiated long-term leases with The City for most of the buildings, including the original airplane hangars. Income from these properties, including the rental of the hangars to film studios, remains the primary source of income for TIDA.

The Naval Station Treasure Island Reuse Plan endorsed by the Board of Supervisors lists a number of significant development constraints that must be overcome before redevelopment can take place. Foremost among them is the seismic safety of the island. The Reuse Plan notes: Treasure Island and the causeway (connecting to Yerba Buena Island) are artificially constructed lands created using non-engineered fill. The fill was placed over a shoal and a layer of weak, compressible bay mud. The fill is held in place by a series of rock dikes constructed around the perimeter of the island.

It is projected that a major earthquake could result in ground liquefaction and substantial differential settlement, seawall failure, and severe lateral spreading … Treasure Island raises the potential for significantly greater risks than other areas of San Francisco known for similar … problems related to artificial fill. The additional risk primarily comes from potential unstable perimeter dikes which surround the entire island. In a worse case scenario,… a major earthquake in the coming years could cause the perimeter dike on Treasure Island to fail and at least portions of the island to slide into the bay.

And according to the Reuse Plan, The need to strengthen the causeway and perimeter of the island to reduce seismic risks imposes substantial up-front costs on development. The costs of upgrading or replacing utilities, as well as the costs for demolition and other site improvements add to the extraordinary cost burdens on development …The need for causeway and perimeter improvements has been acknowledged by the Navy, which was planning to undertake causeway upgrading prior to the base closure announcement, but never happened.

Essential improvements to TI include not only seismic upgrading but also the demolition of existing structures, improved utilities, including a new wastewater treatment plant, and transportation facilities, including a ferry terminal. Added together, these costs totaled over $260 million in 1996 dollars. Obviously, financial assistance from the Navy or the federal government would be helpful, but apparently such funding has never been forthcoming. So, The cost of such improvements is a serious challenge for the project, according to the Reuse Study.

We asked Sylvan about funding, and he said, All seismic work, both shoreline stabilization and foundations for specific buildings, will be funded by the project. Certain uses like residential provide the economic engine to upgrade the infrastructure and pay for the seismic stabilization of the shoreline.

As can be seen, the redevelopment of TI does not lack for problems and providing effective transportation for future redevelopment is certainly one of them. The Bay Bridge, with its awkward exits and frequent traffic jams, offers limited access to TI. So, any redevelopment of TI must provide an alternative means of transportation such as ferries, which provided basic transportation for the 1939 International Exposition. Only now, high-speed ferries can offer a much faster trip.

Concept Marine Associates was brought in by TIDA to study potential ferry service to the island. They worked closely with the Water Transit Authority, the regional agency responsible for expanded ferry service on the bay. Two sites were studied: Pier One in the calm waters off the south-east corner of the island on the lagoon between the two islands, and the exposed western shore of the island.

Pier One was constructed by the Navy to homeport the Battleship Missouri and has been used to store America’s Cup sailing vessels. The site was deemed suitable for a ferry terminal, but the time required for the trip to the Ferry Building around the northern end of TI was deemed to be excessive, and the shorter trip around the south shore of YBI would encounter seal-feeding grounds and heavy container-ship traffic to Oakland. One might wonder if Pier One could, instead, become the homeport of the retired Battleship Iowa, which is currently in the mothball fleet in Suisun Bay. It would certainly make a nice tourist attraction.

The other site studied for a ferry terminal was on the western shore of TI where the terminal for the 1939 Exposition was located. It would require costly breakwater and pier construction, but the trip to the Ferry Building would take only 13 minutes, making the island seem almost a part of The City itself.

But, there are two other alternative sites for a ferry terminal: One is a west-shore inlet or basin excavated into the island, which is favored by the developer. The other would require the replacement of the seismically vulnerable causeway between the two islands with an arch bridge that would permit ferries to enter the lagoon between the islands. Such a concept would solve replacing the earthen causeway, which is in urgent need of seismic strengthening, and providing a ferry terminal in the calm, yet sufficiently deep waters of the lagoon while offering a fast trip to The City. The recommendation for an arch bridge was made several years ago by Vello Kiisk, a former chief engineer and acting port director of the Port of San Francisco. Kiisk was also a partner in Military Base Conversion Consultants (MBC Consultants), a group of retired naval base commanders, including a former Commanding Officer of Treasure Island, plus Kiisk and your author. MBC Consultants participated in reuse studies for several Naval bases that were scheduled for closure.

According to Sylvan, a second recommendation to San Francisco from Urban Land Institute was that, for a project as complex and risky as TI, The City select a master redeveloper through a competitive process. In reality, the master redeveloper would need to have sufficiently deep pockets to do the redevelopment planning process and then the costly seismic upgrading and infrastructure improvement process, followed by the demolition of existing structures and the actual build-out of the redevelopment plan, in return for the potential income from renting, leasing and selling the property.

The TIDA Board issued a Request for Qualifications for a master developer, and in 2002 agreed to enter into exclusive negotiations with the one selected. That master developer is Treasure Island Community Development LLD, which is a partnership of Kenwood Investments (a private-equity, real-estate-development firm headquartered in San Francisco), Lennar Corp. (a national homebuilder with redevelopment projects at Mare Island and Hunters Point) and Wilson Meany Sullivan (which did the spectacular redevelopment of the Ferry Building). The master developer is already well underway preparing the Redevelopment Plan.

According to Sylvan, The exclusive negotiations agreement doesn’t give the developer a right to develop. Basically, it gives the developer an exclusive right to do the planning, which requires architects, planners and engineers costing millions of dollars, until its presentation to the Board of Supervisors. The developer’s ability to develop is contingent upon its project plans being approved by the Board. So, while The City can’t offer the developer the security that they are going to be able to build anything at all, we can offer them the security that we won’t negotiate with anybody else.

We talked with Jay Wallace, the developer’s project manager, who explained that they would do all of the planning on the basis of an exclusive negotiating agreement with TIDA for the final redevelopment contract. So far, the developer has put together what is, obviously, a top-notch planning team including the renowned architectural firm, Skidmore, Owings & Merrill, the land-use planning firm, SMWM, the geotechnical engineering firm, Treadwell & Rollo, and the engineering firm, ARUP.

Wallace said, We will put up the equity capital to build the infrastructure, including all of the new roads and utilities, a new wastewater treatment plant and all of the new community facilities, plus all of the buildings including the homes, the retail facilities and the hotels. We will also pay for the seismic upgrading and the infrastructure, which is substantial. Some of the land will be sold and some will be leased, but most of the land will be retained by The City in perpetuity.

To compensate, Wallace said, We seek a return on our investment through the sales and leasing of property on TI and YBI.