The Citizen

The San Leandro City Council approved construction of the Kaiser Permanente San Leandro Medical Center Monday night–the largest construction project in the city’s history.

San Leandro Mayor Tony Santos labeled the vote historic and called it “the largest creation of jobs by council action in the history of San Leandro.”

The 436,000-square-foot, 6-story complex will generate 2,000 permanent and 3,000 construction jobs, according to City Manager Stephen Hollister.

With the fate of the emergency room at San Leandro Hospital in doubt, the approval of the Kaiser project guarantees at least one ER facility in the city past 2014, said Santos.

Kaiser first approached the city about the site abutting Interstate 880 down to Merced Street in late 2005 after purchasing the former Albertson’s property. Nearly five years of labor culminated in Monday night’s approval of the environmental impact report and rezoning of the property for the medical center and adjacent 275,000-square-foot retail area. Representatives from Bayfair Center told the council the retail portion of the project greatly diminishes the mall’s ability to prosper.

Cedric Young, vice president of development for Bayfair said the proposed big box shopping center “is unnecessary and unwarranted by the market at this time, nor time sensitive.” Young said the mall’s owner have spent over $90 million in improvements since purchasing Bayfair in 2003 and claim potentially lucrative companies have already declined overtures from the mall in advance of opening shop at the new Kaiser site.

According to a consultant representing Bayfair, the mall’s owners fear Macy’s may be one of its existing tenants jumping ship for the new shopping center. Macy’s lease ends in 2012. Bayfair also says Best Buy declined an offer and communicated a desire to possibly add a store near Kaiser.

Representatives for the owners of the former foundry next to the Kaiser property also voiced concern with outlying areas of the project including a dispute over traffic congestion on Merced Street. The foundry’s owners, PH Holdings, says the size of the Kaiser project warrants two left hand turns heading southbound on Merced into the hospital.

City officials close to the Kaiser deal believe PH Holdings interests may be self-serving, though. It has attempted to shop the property to Kaiser for far more than market value, said an official. A San Leandro resident and attorney for Kaiser said, “What they really want is money. They want $2.5 million for that strip of land and they will go home,” said Arturo Gonzalez.

  • Alameda County Fire Department, Kaiser, Sutter Health (for rebuild of Eden Medical Center) will pay $656,000 towards the purchase of heavy rescue firefighting equipment.
  • Kaiser will not protest should the city establish an assessment district for street maintenance.
  • Kaiser paid $5.1 million in advance for their portion of improvements to the Interstate 880/Marina Boulevard interchange project.
  • Will fund Community Impact fund of $3.1 million to the city, $1.6 million of that set aside for street improvement fees
  • Despite reports, Kaiser pays property tax on site until occupancy, scheduled for sometime in 2014.
  • Retail portion of project put on hold until the economy improves, possibly in 2-3 years.

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