As Berkeley officials grappled with what the concept of “community benefits” actually means, the developer of the 18-story high rise at 2211 Harold Way announced at a Jan. 8 meeting of the Zoning Adjustments Board that he is willing to financially assist both the Habitot Children’s Museum and Boss, (Building Opportunities for Self Sufficiency) as well as other organizations who must relocate when the building is constructed.

Joseph Penner, head of Hill Street Investments of Los Angeles, also announced that Landmark Theaters had redesigned its plans for new theaters in the complex. There will now be nine theaters instead of the six theaters previously announced. Landmark has decided it will no longer include stadium seating in the theaters, which frees up room for additional theaters. (There are currently 11 theaters in the Shattuck Cinema complex.)

More than 25 people spoke out over two hours during a meeting of the ZAB about their concerns with the project, which former Mayor Shirley Dean called “too darn big.” Their reservations mirrored those brought up in a previous public hearing in November – the building will be too tall, it might ruin the view of the Bay from the steps of the Campanile, it does not contain enough affordable housing, rents are too high, only out-of-towners will live there, and the shuttering of the theaters during construction will eliminate one of the driving cultural forces in Berkeley’s downtown. (Many of the speakers said the construction would take four years. The developer has said it will take two years.)

After the public hearing was closed, ZAB officials grappled with the enormous task before them: to determine an appropriate level of community benefits for the project. Many commissioners expressed dismay that the responsibility had been left to ZAB. When the City Council adopted the Downtown Area Plan in 2012, it did not define “community benefits,” but left that to the commission. Commissioner Sophie Hahn went so far as to suggest that it was “an abdication by the city council,” to leave the hard work to ZAB.

The 2211 Harold Way project is the first large project seeking approval under DAP, so everyone – the developer, city staff, ZAB commissioners – have to determine the appropriate level of benefits for the project and how to parse those out democratically. There was the sense at the meeting that whatever is decided will also set the standard for the other high rise projects now in the planning pipeline.

“This is a very difficult subject to talk about,” said Prakash Pinto, chair of ZAB. “There’s little guidance about the criteria we are supposed to use.”

One thing that became clear during the discussion among ZAB commissioners was that the community benefits currently proposed by the developer are not significant enough, in part because they thought many of them would be more beneficial to the residents of what will be known as Berkeley Plaza than to the residents of Berkeley. It was a feeling shared by the people who spoke out at the meeting, too.

“The benefits are the extras,” said John McBride, president of the board of the Berkeley Architectural Heritage Association. “They are things given back to the community. It isn’t about them doing the job the way they are supposed to be doing it.”

Berkeley’s Zoning code only offers a general guideline to community benefits: “In order to approve a Use Permit for buildings over 75 feet in height … the Board must find that the project will provide significant community benefits, either directly or by providing funding for such benefits … beyond what would otherwise be required by the City. These may include, but are not limited to: affordable housing, supportive social services, green features, open space, transportation demand management features, job training, and/or employment opportunities.”

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Hill Street Investments has proposed community benefits in the category of green features, transportation demand management, and employment opportunities. The developer has calculated that the community benefits he is offering are worth around $12 million the first year and around $43 million over 20 years. Here is what Hill Street Investments is proposing:

In October, the developer announced that it would use all union labor for the building’s construction. Using union labor will increase costs by 10% to 12%, according to the developer. This community benefit is worth $10 million, according to the developer.

Retaining the Shattuck Cinemas. The original design of the structure did not include the movie theaters, but the developer added them back in after community outcry. Landmark Cinemas had not been planning to extend its lease after it expired in 2017, said Mark Rhoades, whose Rhoades Planning Group is assisting the developer. It will cost about $17 to $20 million to build the theaters, according to the developer. Theaters can’t pay as high a rent as other businesses, so the developer will be subsidizing the rent at a rate of $990,000 a year. The design of the theaters precludes an additional retail space on Shattuck Ave., which will cost the developer $270,000 a year. In total, including movie theaters in the project will cost about $25 million over 20 years, according to the developer.

Transportation Demand Management features that exceed what is required by the zoning ordinance. The developer plans to offer one additional free transit pass to each household; one more than required, erect a SmartWalk transit screen on the building that will project arrival times for BART and AC Transit buses on the sidewalk; provide 11 electric vehicle charging stations; provide secure bicycle parking for 100 residents; allow the BART bike station to stay in its current location for three years at a reduced rent; have three cargo bikes for residents to use, offer shared electric bikes, and more. The developer said these additional benefits are worth $212,400 the first year and $1.15 million over 20 years.

Human-scale Streetscape and Privately-Owned Public Open Space worth about $1.1 million the first year and $7.4 million over 20 years. The developer is proposing to build a new 1,872 square foot plaza at the intersection of Kittredge Avenue and Harold Way that will be open to the public and will revitalize a moribund corner. The developer is also adding things like wider sidewalks, lighting and berms that go beyond a typical streetscape improvement plan. In addition, the plaza is not required to meet open space zoning laws. The developer could have built apartments and another retail store on this corner portion f the site. Forgoing that means Hill Street Investments will lose about $332,000 in rent each year, or about $6.6 million over 20 years, according to the developer.

The developer is not maximizing the massing he could put on the site and the reduced scale of the project is worth $643,000 a year or almost $13 million over 20 years, according to the developer.

These community benefits are over and beyond the benefits required by law, which include making the building LEED Gold, making 10% of housing on site affordable (for a total of 30 units) or paying $6 million in in lieu fees instead to the Housing Trust Fund; providing transit passes and car share parking spaces, paying around $490,000 into a streets improvement fund, and more.

One issue of contention has been what businesses currently in the building will do, particularly Habitot Children’s Museum, which occupies a large underground space. During the meeting it became clear that Hill Street Investments had for the first time offered to make a cash settlement with Habitot and other businesses. Rhoades announced that he, Penner, and Gina Moreland, the executive director of Habitot, had met for the first time on Jan. 8 and that Penner had offered to help with relocation costs. He did not specify the amount. (Moreland has said publicly that it will cost Habitot $250,000 to move.) Moreland will take the offer back to her Board of Directors for discussion, according to a memo Rhoades Planning Group gave to ZAB commissioners.

Moreland confirmed that she had talked to the developer that day for the first time and gave credit to ZAB for making that conversation happen.

“If it were not the attention ZAB played to Habitot, I don’t think the developers would have come forward and approached us,” said Moreland.

During a break in the hearing, Penner said he had had conversations with officials from Building Opportunities for Self-Sufficiency (BOSS), too, and had offered to help pay for relocation costs. Sonya Fitz, the development director for BOSS, confirmed that an offer had been made. BOSS approached Penner a month ago with a proposal, she said. Penner said he is willing to help other businesses as well. He said he would prefer that a fund be established and that the city deal with allocating money rather than having him negotiate with each business.

ZAB commissioners did not discuss the particulars of the proposed community benefits packet in detail. A number of commissioners said their initial impression was that the package did not go far enough. Too many of the components wouldn’t help the general Berkeley population but would help residents of Berkeley Plaza more. Sure, union wages are a good thing, but what might the developer have done otherwise, some commissioners asked.

“I am not really impressed with the community benefits here,” said ZAB Commissioner Shoshana O’Keefe.

ZAB is planning on hiring an independent economist to determine if the developer’s numbers on community benefits are accurate.

Members of the audience and some ZAB commissioners tossed out other community benefit ideas, including paying for Habitot to relocate and then move back in with no rent, not charging the theaters rent, rebuilding the fountain in Civic Center Park, paying small businesses a relocation fee, making the plaza bigger, and including more affordable housing.

ZAB commissioners will discuss the community benefits again in an upcoming meeting.

Related:

Residents question Berkeley Plaza’s impact on theater, views (11.18.14)

High-rise developer in Berkeley to use 100% union labor (10.31.14)

Developers put theaters back into high-rise plans (06.26.14)

Early high-rise plans lack inspiration, say commissioners (03.19.13)

First high-rise in 40 years planned for downtown Berkeley (12.21.12)

Large downtown Berkeley property changes hands (11.28.12)

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