[Images courtesy U.S. Coast Guard via the SF Examiner] Last week, the U.S. Coast Guard presented the proposed restrictions to navigation around the America's Cup Race, and it looks a little smaller than the first go-round. And smaller all over. The America's Cup Race here isn't about boats going fast, it's about real estate, and a much smaller agreement between the city and the yachtsmen is in the works. But before we hand the blame cup to the Mayor, the Board of Supervisors and Ports for looking for too rich a deal, let's look at the overall picture (after the jump.)
This is an expensive race for the America's Cup Event Authority (ACEA) to pull off. NBC didn't buy the broadcast rights for the races, they got them for nothing. Which makes sense for this kind of infant extreme sport- Fox is willing to pay the LA Dodgers $3B for broadcast rights, but baseball's been around a while- instead of the millions of dollars the ACEA was looking for last year. Last November's race in San Diego was undewhelmed by spectators- even rich ones. Contracting in size, the ACEA dropped developing Pier 29 at the last minute, and then just hours before the Supes were to ratify the agreement on February 28, the Event Authority backed out of renovating Pier 30/32 in exchange for building condos on Seawall Lot 330 across the street. There are only/maybe four teams competing instead of ten, all of which fits neatly into Pier 80 as a home base.
It's critical to understand these guys are not in the real estate development business and that (just like for Ports) re-building the piers just doesn't make sense even though they were practically getting them for free. It helps to look at the ACEA as a infant MLB, and they have enough trouble fielding high-octane talent to race. If the real estate penciled out, much bigger players would have been all over it. While the market may be getting better, commercially it's about leasing the abundant excess square footage. In the residential market near Pier 30/32 sellers, have been holding out for fear of taking a loss and the chance that their boats will rise with the A-Cup.
In Mission Bay, a short walk south from Pier 30/Seawall Lot 330 site, this morning the Supes will ratify another 5-year lease for the Giants' parking lots at Seawall Lot 337 instead of a long-term deal to develop it. And while a huge hospital is about to rise in Mission Bay, Salesforce.com has backed out of building a campus in Mission Bay for now. A few blocks north, two new condo towers bigger than anything that could go up at Seawall Lot 330- are ready to go, plus more units just west of the Transbay Terminal. Which just got shorter.
And then, of course, there are birds, turtles and Aaron Peskin to contend with. Work at Piers 30/32 may be difficult to get permits for. There's no room in the ACEA's original development timeline for environmentalist's lawsuits, and having shed the piers may speed things up. It may also be the reason the ACEA is courting New York as a race venue for 2012. With fewer boats, a smaller race route and less commercial navigation, it's possible New York's originally-reluctant officials can embrace it. The New York Yacht Club was long the home of the America's Cup trophy and the waters around New York are prime recreational sailing venues. And maybe this time Ellison and Bloomberg can work it out billionaire to billionaire over golf.
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