Lennar, Concord part ways on base project after labor talks stall

Concord Base reuse project could hit a wall Tuesday

Lennar, Concord part ways on base project after labor talks stall
The developers of the Concord Naval Weapons Stations property have asked the City to substantially change the agreement made last August.

CONCORD, CA (May 23, 2022) — A request by Concord First Partners LLC, the development team selected as master developer for the Concord Naval Weapons Station, to change the terms of their Exclusive Negotiation Agreement with the city of Concord could run the whole project off a cliff this Tuesday night.

In a letter to Concord Director of Economic Development and Base Reuse Guy Bjerke, the Discovery/Seeno-led partnership says the project is not financially feasible, and they are unwilling to continue with any further work without a vested interest in the property.

“Our partnership was fully aware that this project is challenging when we submitted our response to the RFQ,” they said in the April 27 letter signed by principals Albert Seeno III, Richard Lewis and Phil Tagami.

“Now that we have had the opportunity to more closely analyze the assumptions and corresponding numbers, we now have a better understanding why previous developer groups walked away and why the response to the latest RFQ was limited to only three proposals.”

Concord First Partners LLC were selected as master developers of the $6 billion 13,000-home development project over Brookfield and City Ventures last August.

A substantial change

Under the current agreement, the selected master developer has no enforceable interest in the property until final approval of the Specific Plan, EIR and a Disposition and Development Agreement. The developers want to substantially change that agreement by bringing the DDA to the beginning of the process, a move Bjerke says is not in the best interest of the city.

The United States Navy owns the 2350-acre retired military base and has not yet transferred it to the city. Bjerke is recommending the Council deny the amendment and not grant ownership interest in property the city doesn’t own.

Concord First Partners is also asking for a 90-day extension to complete the term sheet and to extend the time to complete the Specific Plan and environmental reports from two years to three. They say unless the Council approves the amendment, they will not proceed past Wednesday when the current ENA expires.

Despite this ultimatum, a spokesperson for the partners told the Pioneer in an email, “CFP is committed to finding a way forward with the City of Concord.”

Déjà vu all over again

The city is finding itself on the same precipice as it did in March 2020 when Lennar Five Point was unable to reach a Project Labor Agreement with the Contra Costa Building and Trades Council after two years of talks, saying the cost of using all union labor made the project financially unfeasible. Lennar asked for an extension to their ENA and the Council refused.

Should the City Council agree to Concord First Partners’ request on Tuesday, Bjerke recommends extending the negotiating agreement to June 28 while staff works with the partners to find a path forward more in line with the city’s interest.

The City Council meeting is Tuesday at 6:30 at City Hall, 1950 Parkside Dr. in Concord. A link to watch the meeting online is on the City’s website at cityofconcord.org.