Title
Recommendation to Approve Sale of City-Owned Property Located at 650 West Ranger Avenue (Building 92) at Alameda Point to Ernst Development Partners, Inc. and Authorize the City Manager to Execute a Purchase and Sale Agreement and Related Documents;
Public Hearing to Consider Adoption of Resolution Declaring Approximately 3.56 Acres of City-Owned Property at Alameda Point Located at 650 West Ranger Avenue to Be Exempt Surplus Land under the Surplus Land Act; and
Introduction of Ordinance Approving a Purchase and Sale Agreement for the Sale of City-Owned Property Located at 650 West Ranger Avenue (Building 92) to Ernst Development Partners, Inc., and Authorizing the City Manager to Execute the Purchase and Sale Agreement and Related Documents. [Requires four affirmative votes] (Base Reuse and Economic Development 29061822)
Body
To: Honorable Mayor and Members of the City Council
From: Adam W. Politzer, Interim City Manager
EXECUTIVE SUMMARY
The City of Alameda (City) owns Building 92 located at 650 West Ranger Avenue within Alameda Point, the site of the former Naval Air Station Alameda. The property includes an approximately 89,018-square-foot, World War II-era industrial warehouse building situated on approximately three acres. As part of the City’s strategy to activate underutilized buildings and support job-generating economic activity at Alameda Point, the City issued a Request for Proposals (RFP) seeking qualified buyers interested in acquiring and rehabilitating the property.
Following a competitive evaluation process and direction from the City Council in closed session, staff negotiated a Purchase and Sale Agreement (PSA) with Ernst Development Partners, Inc. for the purchase of the property for $7,825,000. The buyer intends to rehabilitate and reposition the building for advanced manufacturing, research and development, and light industrial uses.
As a condition of the transaction, the purchaser will enter into a Public Improvement Agreement requiring construction of frontage improvements along the West Ranger Avenue frontage of the property, in accordance with the Alameda Point Master Infrastructure Plan. These improvements will be constructed at the purchaser’s sole cost and secured through improvement bonds consistent with the California Subdivision Map Act.
As part of the public hearing on this item, the City Council will consider a separate consent resolution declaring the property as exempt surplus land under the Surplus Land Act pursuant to Government Code Section 54221(f)(1)(M). That resolution includes findings that the property qualifies for the statutory exemption applicable to former military bases, documents the City’s compliance with notice and affordable housing-related requirements under the Surplus Land Act (SLA), and provides more site-specific details than the district-level SLA exemptions adopted by City Council in 2025.
BACKGROUND
Alameda Point is the site of the former Naval Air Station (NAS) Alameda, which ceased operations in 1997. Following the base closure, the City acquired significant portions of the property and has since pursued a long-term reuse strategy to transform Alameda Point into a mixed-use district with housing, employment, open space, and community-serving uses.
Building 92, located in the Adaptive Reuse Area of Alameda Point, was constructed in 1942 during the Naval Air Station era for warehouse use. It is a one-story, 89,018-square-foot wood-frame industrial building on an approximately three (3) acre parcel and is identified as a contributing historic structure within the NAS Alameda Historic District.
To attract experienced buyers capable of rehabilitating the building and activating the site, in December 2024, the City issued a Request for Proposals (RFP) seeking qualified buyers interested in acquiring and redeveloping the property. The RFP invited proposals from developers capable of investing in the building and delivering employment-generating uses compatible with the City’s long-term planning framework for Alameda Point.
In addition, on January 20, 2026, City Council held a workshop to receive an update and provide feedback on the disposition strategy for leasing and sale of properties within the Reuse Area at Alameda Point. At that workshop, staff presented an update on implementation of the City’s 2023 “Mixed Portfolio” disposition strategy, which prioritizes the sale of buildings and land to generate revenue to fund the replacement of Reuse Area backbone infrastructure improvements in the Reuse Area. The proposed sale of Building 92 is consistent with this strategy, as the property benefits from the adjacent new Phase I backbone infrastructure on Pan Am Way, which was completed by Public Works in 2024, and the proceeds of the sale will primarily be reinvested into the future Phase 2 Reuse Area backbone infrastructure.
DISCUSSION
1. Buyer Selection Process
Proposals received in response to the RFP were evaluated based on several criteria, with purchase price being the top priority as defined in the Disposition Strategy. Other criteria included the buyer’s financial capacity, development experience, feasibility of the proposed reuse concept and alignment with City Council priorities, and the ability to successfully rehabilitate the building.
Following evaluation of the proposals, staff presented the results of the RFP process to the City Council in closed session and recommended that the City proceed with negotiations with Ernst Development Partners, Inc. The City Council provided direction to staff to enter into negotiations with the selected developer.
In addition to Ernst Development Partners, Inc., the City received proposals from Alameda Point Redevelopers, and Best Bay Apartments, Inc. (dba Riaz Capital). A fourth proposal was received but the developer rescinded their proposal during the process. Each proposer submitted a redevelopment concept involving adaptive reuse of the building for commercial or light industrial uses, with the space demised into several suites to serve smaller businesses than other Alameda Point Reuse Area buildings are able to attract today.
While all three proposals were responsive and demonstrated viable reuse concepts, Ernst Development Partners, Inc. was identified as the top-ranked proposer based on its highest purchase offer, strong financial capacity, proven track record of delivering adaptive reuse projects at Alameda Point and elsewhere in the Bay Area, and a redevelopment plan that is both feasible and aligned with the City’s economic development and disposition strategy objectives.
The negotiated Purchase and Sale Agreement provides for the sale of the property for $7,825,000. The agreement includes a due diligence period during which the buyer may conduct inspections and feasibility analyses of the property. The property will be conveyed in its existing “as-is” condition.
The timing of the sale is also driven by several factors, including the City’s ongoing carrying costs and liability associated with underutilized and aging facilities, and the opportunity to leverage private investment to rehabilitate the building and return it to productive use. The proposed redevelopment will address deferred maintenance, improve building systems, and enable occupancy by multiple tenants.
Ernst Development Partners, Inc. proposes to rehabilitate the building and reposition it for modern industrial uses, including advanced manufacturing, research and development, and flexible industrial tenancy. The rehabilitation is anticipated to include structural upgrades, building system improvements, hazardous material abatement, and tenant improvements necessary to support long-term occupancy by industrial and technology-oriented tenants. Ernst Development Partners, Inc. has completed similar projects with Buildings 9 (707 West Tower) and 91 (651 West Tower).
As part of the transaction, the purchaser will enter into a Public Improvement Agreement with the City requiring construction of frontage infrastructure improvements along West Ranger Avenue along the north side of the property. These improvements generally include curb, gutter, sidewalk, drainage improvements, street lighting, pavement improvements, landscaping, and utility connections, and are the standard street frontage improvements expected of buyers or developers rehabilitating or developing new buildings. West Ranger Avenue is not a backbone street in the Alameda Point Master Infrastructure Plan and is thus not included in the City’s Reuse Area backbone infrastructure program. The improvements will be constructed at the purchaser’s sole cost and secured by performance bonds and other improvement security in accordance with the Subdivision Map Act. The improvements must be completed within a specified period following close of escrow and will be subject to City inspection and acceptance.
2. Site Specific Surplus Land Act Resolution and Project Stabilization Agreement Resolution 15740
In accordance with the California Surplus Land Act (Government Code Section 54220 et seq.), the City must declare the property either “surplus land” or “exempt surplus land” prior to disposition. The accompanying resolution includes findings documenting that Alameda Point - and this transaction in particular - satisfy the statutory requirements for this exemption, including applicable affordable housing and open-space notice requirements, the latter of which were satisfied in September 2025.
One requirement of the SLA is consistency with the City’s Project Stabilization Agreement Resolution. This Resolution (15740) sets forth criteria for projects requiring a project labor agreement. The Building 92 sale is a direct sale of an existing City-owned building and does not involve a lease with tenant improvements, a DDA, DA, or other City development agreement, an affordable housing project, or any City financial contribution or subsidy, which are the criteria that trigger the applicability of the PSA Policy. As such, staff have found this project to be consistent with Resolution 15740.
3. Alameda Point Collective Payment
Pursuant to the City Council-approved Disposition and Development Agreement dated October 5, 2023, for the Alameda Point Rebuilding the Existing Supportive Housing (RESHAP) project, the City is obligated to pay Alameda Point Collaborative (“APC”) $500,000 for the early termination of APC’s leasehold interest in Building 92, which occurred in 2024. This payment compensates APC for lost rental income and facilitates site readiness for redevelopment. The agreement provides that this payment shall be made from the proceeds of the sale of Building 92 within thirty (30) days following closing.
4. Ordinance
Pursuant to the Alameda City Charter, the sale of City-owned real property must be approved by ordinance. The accompanying ordinance approves the Purchase and Sale Agreement with Ernst Development Partners, Inc. and authorizes the City Manager to execute the agreement and related documents necessary to complete the transaction.
The proposed transaction will activate an underutilized City-owned asset, facilitate private investment in building rehabilitation, and generate proceeds that support the City’s broader strategy of funding backbone infrastructure improvements within the Alameda Point Reuse Area. The proposed sale is consistent with the City Council’s direction to implement the Reuse Area disposition strategy by advancing property sales that support ongoing and future backbone infrastructure investment at Alameda Point.
ALTERNATIVES
• Approve the proposed sale of Building 92 and authorize the City Manager to execute the Purchase and Sale Agreement and related documents, as recommended.
• Do not approve the proposed sale and direct staff to pursue an alternative disposition strategy for the property.
• Provide other direction to staff regarding the disposition of the property.
FINANCIAL IMPACT
The sale of Building 92 will generate $7,825,000 in gross revenue to the City, less customary closing costs, transfer taxes, title and escrow charges, broker commissions, and a required $500,000 payment to Alameda Point Collaborative (APC) pursuant to the October 5, 2023 Disposition and Development Agreement for the RESHAP project. Based on preliminary estimates provided by the escrow agent, customary closing costs are estimated at $150,000, and net proceeds to the City are anticipated to be approximately $7,150,000.
In addition, the purchaser will fund the required frontage infrastructure improvements along West Ranger Avenue, thereby reducing the City’s future infrastructure obligations in this area. The $500,000 payment to APC will be made from the proceeds of the sale and paid within 30 days following closing.
MUNICIPAL CODE/POLICY DOCUMENT CROSS REFERENCE
Alameda Point Environmental Impact Report (2014) Alameda Point Master Infrastructure Plan (2014 and 2020) California Surplus Land Act (Government Code Section 54220 et seq.)
City of Alameda Resolution 15740 on Project Stabilization Agreements for Alameda Point City Strategic Plan - TIE 25 - Implement the City’s Disposition Strategy for Alameda Point
This action is subject to the Levine Act.
CLIMATE IMPACT
The adaptive reuse of an existing building supports the City’s climate objectives by encouraging infill development and reducing the need for new construction materials. Rehabilitation of existing structures reduces construction-related emissions and supports redevelopment of Alameda Point as a compact, mixed-use district.
ENVIRONMENTAL REVIEW
The designation of the property as exempt surplus land pursuant to the Surplus Land Act does not constitute a “project” as defined in California Environmental Quality Act (CEQA) Guidelines Section 15378 and therefore no further CEQA analysis is required.
The City Council finds that approval of the PSA and authorization of the sale of the Property is does not constitute a “project” as defined in California Environmental Quality Act (CEQA) Guidelines Section 15378 and therefore no further CEQA analysis is required. The transfer of ownership of the Property from the City to Buyer does not commit the City to any particular course of action that would have a reasonably foreseeable effect on the environment, nor would the transfer of ownership itself have such reasonably foreseeable effect. Any future proposals for the Property the will necessitate any permitting or other approvals by the City will be subject to the City’s standard regulatory processes and further environmental review as applicable. Specifically, any future development, rehabilitation, or reuse of the Property will be subject to separate environmental review in accordance with CEQA. On a separate and independent basis, approval of the PSA is from further CEQA review pursuant to CEQA Guidelines Section 15061(b)(3) (the "common sense" exemption), as it can be seen with certainty that there is no possibility that the approval of the PSA itself will have a significant effect on the environment.
RECOMMENDATION
Adopt a resolution declaring the property located at 650 West Ranger Avenue (Building 92) at Alameda Point to be exempt surplus land under the Surplus Land Act; introduce an ordinance approving the sale of City-owned property located at 650 West Ranger Avenue (Building 92) at Alameda Point to Ernst Development Partners, Inc.; and authorize the City Manager to execute the Purchase and Sale Agreement and related documents necessary to complete the transaction.
Respectfully submitted,
Abigail Thorne-Lyman, Base Reuse and Economic Development Director
By,
Nicole Franklin, Base Reuse Manager
Financial Impact section reviewed,
Ross McCarthy, Finance Director
Exhibit:
1. Purchase and Sale Agreement