OAKLAND, CA - A legal settlement has breathed new life into City Walk, a long-stalled residential and retail project that's been touted as a crown jewel of the ongoing quest to revive the city's downtown. Construction should resume by sometime in November on the luxury condos, said Tony Bosowski, Northern California regional president with project developer the Olson Co. Construction on the project in downtown Oakland halted in July 2007. "We plan to start working on the building in the next couple of months," Bosowski said. "The important thing is we will resume working on the project. The Olson Company is committed to seeing this project built."
The problems with City Walk began when UPA California, the construction company that Olson hired to build the project, failed to perform. UPA later filed for bankruptcy. That in turn led to a legal battle between Olson Co. and the company that provided the bonding insurance for the UPA construction firm.
"The case involving the bonding company is settled," Bosowski said. "The parties are pleased we could resolve the dispute without further litigation." The settlement transpired within the last few weeks, he added. Bosowski would not discuss the nature or details of the agreement between Olson and the bonding company.
City Walk consists of 252 residential units and about 3,000 square feet of retail. Industry watchers believe the six-story project is crucial to the success of downtown Oakland, said Ken Meyersieck, a broker with Colliers International, a commercial realty firm. "This is right in the heart of the city center," Meyersieck said. "It's an important part of that area."
The development was part of the gambit by Oakland's former mayor, Jerry Brown, to create 10,000 residential units in the downtown. The burst of housing was needed, the initiative's proponents stated, to help create a nighttime and weekend urban center for Oakland, and to spur creation of new stores, restaurants and entertainment centers. "We believe that City Walk is in a prime location and that it ultimately will be an outstanding project," Bosowski said.
The framework of the building was largely completed when the work halted. City officials said they were dismayed at the halt in construction. "It's been frustrating," said Patrick Lane, a city development manager. "You don't want a project to just sit there looking blighted." Olson Co. developed the project as condominiums for sale. Selling the units remains the goal of the developers. The units range in size from 570-square-foot studios to 1,825-square-foot two-story units, Bosowski said.
Despite the recent favorable indicators for the project, it appears that some obstacles must be overcome before work ramps up to full speed. For one thing, Olson Co. has yet to select a contractor that will take over UPA California's work. A timetable to complete the project wasn't disclosed. What's more, the housing market has collapsed. And that has created a murky outlook for sales of the condos. "Delays are never good," Bosowski said. "But we still believe in the location and we believe in downtown Oakland as a market."
Ultimately, the project would bring hundreds of new residents to the downtown. "The sooner they can get this going, the better," Meyersieck said. "You want to get people living downtown and spending money downtown."
Source: InsideBayArea.com