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Soaring Costs Force Changes To Brower Center Projects

By Richard Brenneman
Tuesday January 09, 2007

Soaring construction costs and tight money have forced the developers of the two David Brower Center projects to alter their plans, while forcing the city to up its direct subsidy of the project to $6.2 million. 

But the changes won’t delay construction, now scheduled to begin in March or April and leaving the city without a popular parking lot probably until work is completed 22 months later, said the project’s builder, John Clawson of Equity Community Builders 

The two most visible project changes will involve replacement of costly metals by less expensive materials. 

While the design of the six-story affordable housing building dubbed Oxford Plaza remains the same, the originally planned metal siding will be replaced with stucco. 

City Housing Director Steve Barton said that while the stucco will be an adequate material for the housing, “metal would’ve been more striking, and the center of the downtown is a good place for striking architecture.” 

And metal awnings for the ground floor retail spaces of Oxford Plaza and the companion David Brower Center office and retail center will also change, with canvas replacing metal, said Clawson. 

“I didn’t feel the changes were significant in view of the incredible cost pressures,” said Bob Allen, the architect who chairs the city’s Design Review Committee. 

Some DRC members were dismayed at the switch of sidings for the housing project, and one member complained it would be “just another stucco box.” 

In their resolution approving the alterations, the committee urged the City Council to encourage project developers to reverse the changes if possible. 

A major culprit in the construction inflation is China, which is in the midst of a major building boom that has sent prices of concrete and steel soaring. 

“For the last three or four years, costs have been going up 10 to 15 percent a year, where 5 to 6 percent was typical,” Allen said. “I’ve got projects where I’m fighting these costs.” 

“Overall constructions costs in the Bay Area have gone up 15 to 20 percent,” said Clawson. 

The project consists of two buildings which will rise at the site of the city’s Oxford Lot, the ground-level pay parking facility on Fulton between Allston Way and Kittredge Street. 

That facility, a favorite of movie-goers and shoppers, will close when construction begins in March or April and will be reincarnated as an underground lot 22 months later when construction is complete—though “there’s a possibility we may be able to reopen the lot sooner,” Clawson said. 

Oxford Plaza will offer 97 housing units, all priced at rates affordable to low-income tenants and families in a 55,000-square-foot building with ground floor retail space and a central courtyard. Tenants will have access to 41 parking spaces. 

The companion David Brower Center features 31,700 square feet of office space, a 7,000-square-foot conference center, a restaurant and 8,500 square feet for retail sales. 

The underground lot, which will be the first phases of construction, will offer 97 spaces. 

The office building is designed to meet the highest, or “platinum,” rating conferred by the U.S. Green Building Council, and the office building won’t offer any parking spaces in line with the philosophies of the environmental organizations which are the center’s primary tenant base. 

Still, Clawson has acknowledged that nothing would preclude the lease of up to half of the spaces to downtown Berkeley’s biggest and fastest-growing tenant, UC Berkeley and the remainder to non-environmental groups—although many environmental organizations have signed letters of intent to move into the building. 

But the project has been attended by conflict, in part because it has consumed the city’s Housing Trust Fund, leaving no revenues for other projects. 

The latest blow came when the largest tenant, eco-retailer Patagonia, backed out, leaving the city council no choice but to sign as guarantor of the $1 million in estimated lost revenues. 

That million was part of the $2.2 million in additional loans approved by the City Council last month, and brings the city’s total loan guarantees for the project to $4.7 million. 

The most recent cost estimate for the two projects has reached $55.2 million, up from the previous estimate of $44.7 million—a 24 percent increase. 

While Clawson said the council’s decision to up the ante will provide all the needed funding, Barton adds a caveat. 

“That’s true in the sense of a scenario in which everything works out the way we hope, but a consultant who looked at the project said costs could increase by as much as a couple of million dollars more,” he said.