ALAMEDA, Calif. (KTVU) - After decades of planning, a major housing development on a former military base in Alameda has run into financial trouble.
But the developer believes he has found a solution and is hoping that it meets with the approval of the Alameda City Council
The proposed development is called Alameda Point. It would sit on 68 acres of what was once part of the Alameda Naval Air Station.
The plan is to build 800 housing units, 200 of them affordable, along with commercial space and public park.
But after years of planning the developer says the project is in financial default.
"The deal could collapse, yes," said developer Joseph Ernst.
Ernst says the problem is due mainly to escalating construction costs that have risen by almost 50 percent in recent years,
"The problem here is as land values decrease our costs aren't decreasing. We end up at the point where there is not enough to cover the costs," said Ernst.
But in an effort to save the project, the developer Alameda Point partners has proposed changes. Changes that include putting up much of the housing faster than previously planned.
The developer wants to dedicate 70 units of housing to teachers and employees of the Alameda Unified School District.
The revised plan must be approved by the Alameda City Council.
"Anytime you have a developer go into default that is serious. Hopefully, they come back with an offer that meets our needs," said Alameda Mayor Trish Spencer.
Spencer says she's been pushing for more workforce housing on the former base.
"I'll be reviewing the new proposal. But my preference would have been for us to be farther along than we are right now," said Spencer.
The city council is expected to take up the issue July 5.