July 21st, 2025

Can a new developer finally get Oak Knoll off the ground?

Original article by Natalie Orenstein for The Oaklandside >

Neighbors are flummoxed over the lack of construction on hundreds of homes, shops, and parks planned for the East Oakland hills. A new company says it can speed things up.

Nearly two decades have passed since a developer first bought around 190 acres of land in the Oakland Hills, angling to build hundreds of homes and shops on the former site of a naval hospital. And nearly one decade ago, the city approved that plan.

Today, paved roads and a newly restored creek run through the serene swath of land between Keller Avenue and Mountain Boulevard, a couple miles southeast of Merritt College. A landscaped park dotted with stone sculptures awaits visitors. But not a single home has been built on the Oak Knoll property, frustrating and perplexing neighbors.

Boston-based developer Freehold Communities took over the management of the project from Argent Development at the beginning of the year, and the developer says it’s in a position to see it through.

Over the past few years, developers have sought entitlements — general approvals to build on the land — from the city of Oakland for the first phase of the project, which includes 290 homes on the southern part of the property. The full project has 918 homes — townhouses, single-family homes, and similar — as well as 86,000 square feet of space for shops, trails, and parks.

Shuckhart said most of the city approvals for the first phase are now complete and final preparation work on the lots should begin in the next month or two. The plan is to sell off the different lots to various homebuilders.

That might prove difficult. Market-rate construction has ground to a halt in Oakland, thanks to a variety of national market forces and local barriers, including high interest rates, skyrocketing construction material costs, plateauing rents, investor wariness over conditions in Oakland, a slow permitting process, and strong labor requirements.

Shuckhart said Freehold is doing what it can to make the Oak Knoll lots appealing and accessible to builders.

“One of things we recognized early in our tenure is there were concerns about how long it took to get things processed — entitlement in California is always difficult,” he said. “We’ve undertaken an effort to actually design the homes, so once the lots are finished, builders can immediately pull permits.”

According to Shuckhart, construction could begin as early as the end of 2025, or early next year if not.

For nearby residents, the Oak Knoll saga is “disheartening”

The story of the Oak Knoll project is filled with twists, turns, and false starts.

A century ago, the land, located right above I-580, housed a golf course. During World War II, a U.S. Navy hospital opened there; the Oak Knoll Naval Medical Center operated until 1996. Conversations about redevelopment of the property started soon after it closed, with the City Council approving a general plan for housing, commerce, and open space in 1998.

Developer SunCal and Lehman Brothers bought the property in 2006, intending to carry out the plan. But just two years later, Lehman Brothers collapsed in bankruptcy during the subprime mortgage crisis.

SunCal ended up buying the site again in 2014, and the city approved an updated development plan for Oak Knoll in 2017.

It is unclear whether SunCal still owns the property. Shuckhart said he couldn’t speak to the ownership structure. An email to the address on SunCal’s website bounced back. Investment firm Avila Real Estate Capital wrote online this year about leading the recapitalization of Oak Knoll, but did not respond to a request for further information. A city of Oakland spokesperson said the owner of the site is Oak Knoll Venture Acquisition LLC. State business records associated with that company do not provide much detail regarding who’s behind it.

Woven through these years of shifting ownership and stalled starts were tensions over whether to include affordable housing and preservation of the old naval buildings. The final plan includes no affordable housing; instead, the developers will pay $20 million in fees to the city to build low-income housing elsewhere. The city also retained ownership of a roughly five-acre lot on the property where it could pursue affordable housing on its own.

Following advocacy by the Oakland Heritage Alliance, a group supporting preservation, SunCal saved the old naval officers’ clubhouse, lifting the entire property and wheeling it to a new location in Oak Knoll to be renovated as a community center. SunCal also completed significant restoration and landscaping work, uncovering Rifle Range Creek, which had been developed over.

In recent years, The Oaklandside has heard from numerous Oakland residents who say they’re confused and concerned about why there are still no homes on the property or even under construction. The city is supposed to be building housing, fast; every eight years, state and regional authorities announce the number of new residences needed in each California city and county, and Oakland’s allotment for the 2023-2031 cycle was upwards of 26,000 units. The Oak Knoll project would provide a big step toward reaching that far-off goal.

Zoe Robinette bought a home next to the project site in 2006. Coming from Russian Hill, she was looking for a calmer location away from the hustle and bustle of San Francisco but still within a walkable community where she could run her errands.

When she heard about the new development planned for Oak Knoll at the time, Robinette thought, “Oh, that’s perfect.”

Twenty years later, she and her neighbors are stunned and dismayed that the project is still not off the ground.

“It’s really disheartening,” she said. By now, Robinette imagined she’d be picking up groceries from Oak Knoll, saying hello to new neighbors on her short walk home — not staring for years on end at fencing and fraying mesh wrapped around the construction site.

The previous developer would send periodic updates to nearby residents in the mail, but Robinette said they haven’t heard anything from Freehold yet. She praised the work that has been done so far on the roads, landscaping, and creek. But market conditions and other limitations “don’t explain two decades,” she said.

Read the original article by Natalie Orenstein for The Oaklandside >