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Major banks freeze Shipyard lending

Bank fallout threatens development’s future

A view of an area where soil has been removed and tested for cleanup. Nearly half of areas like this at the shipyard show evidence of potential data manipulation or falsification, according to a review. Photo by Chris Roberts

Another hard break for Hunters Point development efforts washed up on Sunday, as the San Francisco Chronicle reported that three of the nation’s largest banks have suspended lending for would-be buyers at the SF Shipyard.

According to the Chronicle, Wells Fargo, Citi, and Chase will no longer back potential condo purchases at the former Navy base, which is currently embroiled in scandal over efforts to decontaminate the site after decades spent storing radioactive materials.

As Curbed SF first reported in January, Tetra Tech, a Pasadena-based company contracted by the Navy to clean up the site, stands accused of faking or bungling soil tests at Hunters Point.

The city hopes to someday build over 10,000 new homes in the former Navy yard, a critical element of City Hall’s long-term housing plan for the city.

The scandal over Tetra Tech’s fraud and the health risks it may pose for future and current residents threatens to sink those goals.

The Shipyard site broke ground in 2013 and began selling to the public in 2014, offering relatively affordable condos and townhomes—starting prices were around $500,000 for two-bedroom set-ups.

According to developer Lennar, “Several hundred families are already living, playing, and growing” in the new southeastern neighborhood.

The Shipyard site was supposed to be spared both the danger and stigma associated with the radioactive cleanup, since the Navy supposedly never handled nuclear materials on these parcels, which were formerly administrative offices.

But the discovery of an irradiated Navy artifact at the site earlier this year cast doubt on decades of assurances about health and safety.

Now major banks are recoiling from the site, leaving its future highly unstable. In response to the news, Lennar has said that other lenders are still backing the Shipyard. Read more about the financial fallout here.

Home to what was at one time the largest gantry crane in the world and the largest drydock in the United States, the city and a major developer want to build thousands of units of housing at the polluted former naval shipyard at Hunters Point. Visible fro Photos by Chris Roberts