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SF Business Times

June 24, 2016

Treasure Island is set to become San Francisco’s new $5 billion neighborhood

By Blanca Torres

After nearly two decades of planning, negotiations and legal battles, a new community is finally starting to rise in the middle of the San Francisco Bay.

Man-made Treasure Island and adjoining Yerba Buena Island are being prepped for an addition of up to 8,000 new homes, 500 hotel rooms, 300 acres of parks and open space, 140,000 square feet of retail and 100,000 of office space to be built over the next 20 years at a cost close to $5 billion.

We knew it would take time, but we might not have thought it would take 12 to 15 years to get approvals,

said Chris Meany, principal of Wilson Meany, one of the four development partners working on Treasure Island. The other three are Lennar Corp., Kenwood Investments and Stockbridge Capital Group. Skidmore, Owings & Merrill LLP served as lead architect and master planner.

Work on infrastructure for the first phase kicked off this spring. That means demolishing existing buildings, bringing in a huge amount of new dirt, making the site seismically sound, and building out infrastructure such as roads, utilities and sewer lines.

Developers estimate that just making the land suitable for new construction will cost $1.6 billion over the entire build out. But it promises to bring thousands of homes to San Francisco at a time when continued job and population growth are expected to keep pushing rents and home prices higher. And it’s a chance to build a new neighborhood from the ground up.

The project will be built in phases with the first new housing projects starting construction next year and residents moving in within two to three years. The first phase of the project is slated to include up to 2,100 housing units.

“Some of our brethren look at us as if we have two horns and a tail and wonder, ‘Why are these guys doing that?’” said Kofi Bonner, head of FivePoint Communities, a subsidiary of Lennar that is working on the Treasure Island project. “It’s because we look forward to these specific times when actual development happens and dirt gets turned and homes get conceived and families ultimately move in and what we conceived over the years actually becomes a reality.”

Underused asset

Even some lifelong San Franciscans have never set foot on Treasure Island. It was built in the late 1930s as a location to host the 1939 World’s Fair. It served as naval base from 1942 until 1997. After the base was decommissioned, planning to redevelop the island began. In the meantime, the City of San Francisco has used former military homes as rental housing.

The development team secured approval for the project in 2011, but were then hit with a lawsuit from a group led by then-former San Francisco supervisor Aaron Peskin (see related story here). That halted progress until the suit was resolved in 2014.

The lengthy process had some benefits.

“As a result, the plan is a better plan,” said Fei Tsen, president of the Treasure Island Development Authority board of directors. “It was really important to get community buy-in in the overall masterplan. We also had to put time into the environmental evaluation and toxic remediation.”

The Navy is responsible for completing environmental cleanup of the site, some areas of which had high levels of radioactive contamination and were uninhabitable for years.

As the clean up process moves along, the Navy has begun transferring chunks of the land to the developers for a total purchase price of $55 million for about 450 acres.

Exciting engineering

Building on Treasure Island has its own set of environmental and seismic challenges. But those challenges resulted in a design for a greener, safer neighborhood than in many parts of the Bay Area.

“This is a rare opportunity to build something to the highest standards of sustainability,”

Meany said

The new development is designed to be as energy efficient as possible with a solar farm and solar panels on homes, said Kheay Loke of Wilson Meany, the project manager for Treasure Island. The buildings will be positioned to soak up the most warmth from the sun and thus, require less energy to heat. The development will have its own wastewater treatment system and make use of recycled water.

Making the land more resistant to earthquakes and rising sea levels requires compacting the soil and then adding more dirt on top to raise the elevation by about three feet. At that level, the development sites on Treasure Island will be four feet higher than on the Embarcadero in San Francisco, Loke said. This will require millions of cubic feet of new soil.

Wilson Meany and Lennar plan to build at least 60 percent of the new market-rate housing and most of the commercial space other than the hotels. Some of the land will be auctioned off to other housing developers. Construction is expected to extend into the 2030s.

Economic integration

Treasure Island isn’t just trailblazing with environmental and seismic design; it’s also pushing boundaries by creating a mixed-income community.

The island currently has about 250 units for the formerly homeless that house about 700 people and about 650 market-rate apartments. The new development plan calls for 435 units for the formerly homeless out of the estimated 2,000 units that will be set aside for low-income residents. City officials will select developers for the affordable housing later on.

Replacement housing for the formerly homeless residents will be built by the time their existing homes need to be demolished. That means tenants won’t have to leave the island during the redevelopment, said Sherry Williams, executive director of the Treasure Island Homeless Development Initiative.

“We’ve been waiting for this moment for a long time,” she said of the site preparation starting. “There are enormous opportunities to serve low-income San Franciscans.”

The agency has also been working to recruit and train people to work on the construction, which is expected to generate about 1,100 jobs during the course of the buildout.

“The affordable housing is integrated with the market-rate housing, not in separate areas,” said Williams, who has been involved in the planning efforts since the mid-1990s. “It’s really a vision of creating a neighborhood of mixed-income residents.”

The ability to build a substantial number of new homes will be significant for San Francisco, said John Stewart, who heads the John Stewart Co., which has managed the market-rate apartments on the islands. He said the project has the potential to vastly improve life on the island with more transit options and a larger community.

“You can generate a lot more housing in the middle of the bay in a beautiful setting,” he said.

Current market-rate tenants have slowly been moving out as their leases expire and the infrastructure work ramps up. Last summer, some residents of Yerba Buena Island protested having to leave their units even though they were offered a cash payment or another unit on Treasure Island.

Many were concerned that when new housing is built, the prices will be far higher than current rents that range from about $2,400 to $2,700 per month for a two- to four-bedroom — much lower than other areas of San Francisco.

Prices for the future homes haven’t been set, but Meany said they will serve a variety of incomes because they range in size from small apartments to large houses. And, for first time, for-sale housing will be available on Treasure and Yerba Buena islands.

“Ultimately, houses sell at what the market rate is for those houses,” Meany said about the cost of the future units.

Public amenities to bloom

The new development will offer many more amenities to residents than the current housing does, Bonner said. That includes more transit, more parks, more retail and more services such as schools, childcare and healthcare.

Building out all 8,000 planned units could bring in some 20,000 residents and generate about 2,200 permanent jobs in the new commercial space. To accommodate all those people, plans call for adding ferry service and increasing bus service to downtown San Francisco, adding bus service to the East Bay and a free on-island shuttle. The new development will also include more bike lanes and pedestrian connections.

“You want to minimize the automobile so folks really have a different way of living in a dense urban neighborhood,” Bonner said.

Creating a new critical mass of residents will help attract vendors for the retail space that will both serve locals and visitors. Part of the challenge with the project was to foster a neighborhood feel and become a regional destination, Meany said.

One big wild card: A museum. Filmmaker George Lucas, creator of the Star Wars franchise, is reportedly considering Treasure Island as the site for a museum celebrating his work after other locations in San Francisco and Chicago have not panned out. The museum could fit into a parcel zoned for a cultural institution in the southwest corner of Treasure Island.

Treasure Island developers said the museum would be a great addition to the island’s attractions along with stunning views, parks, bike trails, wineries, retail and community events, such as the Treasure Island Music Festival.

“Given the world-class nature of the community we are building and given the potential of a Lucas museum to be a world-class, iconic institution,” Bonner said, “we owe it to the island and our community and certainly to the city, should they wish to pursue this, to work with the Lucas folks to see if this can be accommodated.”

Reimagining treasure island

The redevelopment will create new neighborhoods across Yerba Buena and Treasure islands. Yerba Buena offers steep hillsides. The western edge of Treasure Island faces downtown San Francisco offering views of the skyline, but has much more wind than the eastern side, which looks out to the East Bay.


The Eastside district at the southeastern corner of Treasure Island will encompass a residential neighborhood accented with the Eastside Commons park and pedestrian connections to the Island Center district.


One of two primarily residential neighborhoods, Cityside will offer views of San Francisco, Angel Island, Alcatraz and both of San Francisco’s iconic bridges.

Island center

The Island Center District on the southern edge of Treasure Island will be a hub with connections to transit, parks, public spaces, plazas, retail and proximity to the marina.

Yerba buena island

Yerba Buena will incorporate new housing, a hotel, bike paths, hiking trails and Hilltop Park to emphasize the island’s topography.


1939: Man-made Treasure Island is completed for the world’s fair. It is adjoined to Yerba Buena Island with an isthmus.

1942-1997: Navy operates a base on Treasure Island.

2011: San Francisco Board of Supervisors approve a development proposal for Treasure Island.

2016: Infrastructure work begins to transform the island into a new neighborhood.

2017: Construction on the first new housing units will begin.

2018-2019: First residents will move into new housing.

2032: Estimated date of completion.

Sea level rise

Scientists are predicting that sea levels could rise as a result of a warming climate. To prepare for a rise in sealevel, the Treasure Island development team came up with three approaches:

Development sites will be elevated by 3 feet.
New development structures will be set back at least 300 feet from the shore so that if heavy storms create higher waves, structures won’t be flooded.
Reserve funding to pay for future needs. A portion of property taxes from the new developments will be set aside to fund projects such as construction of seawalls or levies.

By the numbers

  • Infrastructure costs to prepare the site for development: $1.6B
  • Homes, with 6,000 of them market-rate and 2,000 affordable: 8,000
  • Hotel rooms: 500
  • Square feet of retail and commercial space and up to 100,000 square feet of office space: 140,000
  • Projected population growth from the existing 2,000: 20,000
  • Total acreage for redevelopment, including 300 acres of open space and 150 acres of developed areas: 450

Read the full article here.