As city meetings to discuss approvals for the Oak Knoll project near, criticism of the developer by some bay area anti-growth activists have suggested that this project will not be good for our community. City Council President Larry Reid, however, has been telling a very different story and has actively promoted some big numbers when it comes to economic benefits from the Oak Knoll development. He regularly talks about the project generating 5000 jobs or adding $5.2 million annual in recurring revenue to the City. So where do these numbers come and what do they mean for Oakland?
In late 2016 SunCal, the developer of Oak Knoll commissioned Sacramento based consulting firm DPFG to conduct a detailed study of the economic impacts and benefits that the Oak Knoll project would bring to the local economy. DPFG worked closely with Implan, a nationally recognized economic modeling firm.
“The results of our review indicate that Oak Knoll will produce significant economic benefits to the local economy, including impact fee benefits, construction benefits, employment benefits, earnings increases, and tax revenue generation,” said Chris Austin, DPFG Managing Principal.
According to the DPFG report, each year the project is expected to bring $28.5 million of new sales from businesses in Oakland by the new homeowners in the community. The report also revealed the Oak Knoll development would create over 5,000 new jobs over the construction of the project and an estimated $335 million in increased worker earnings.
Austin explained that given the size and cost of the project — the initial development and subsequent residential and non-residential construction — the estimate of 5,000 jobs is very realistic.
“Using our methodology, the cost of a construction project combined with data on the specific geographic area of the project location, produces a very accurate picture of the number of construction jobs that are necessary to implement a project. We have prepared this analysis with Oak Knoll,” said Austin.
The report does more than talk about jobs. The bigger impact is long-term generation of revenue to the City of Oakland and Alameda County and what that money can do for the community.
For example, DPFG claims that the property taxes alone from the development will generate approximately $8.1 million a year that can be directed toward city, county, BART, EBRP the Oakland Unified School District and other agencies. They estimate that the sales from new residential spending will generate $58.9 million.
Chris Austin explained how the project will also create a jobs and revenue domino effect of benefits to the entire city of Oakland and the region. Although the DPFG report was presented to the City, it is public information that should be read by those who criticize new developments. Councilmember Larry Reid argues that the Oak Knoll Project helps to address his community’s need for economic development, jobs and new sources of revenue.
Austin said, “If city leaders value economic development, job creation and new revenue to the community, and if the city wants growth, they should approve projects like Oak Knoll.”
Austin and Reid may be right. The Oak Knoll development is one of a handful of major projects. And, according to the DPFG study, it is projects of this size that can make things happen and ultimately attract other developers and businesses that can provide community benefits.