The new master developer slated to transform the former Concord Naval Weapons Station has financial ties to Arab states in the Persian Gulf, linking the long-controversial project to a history of human rights violations, ethical quagmires and shady business dealings involving the Trump Administration.
The vision for the sprawling acreage is a huge mixed-use and transit-oriented community — the largest development currently underway in the Bay Area. It would comprise roughly half of the site’s total 5,046 acres just south of the still-existing Military Ocean Terminal Concord, an ammunition depot that sits on the Sacramento-San Joaquin River Delta.
The Concord City Council — acting as the authority for the site’s redevelopment — unanimously approved Brookfield Properties’ massive 2,300-acre plan for the barren land in a four-hour meeting Aug. 26.
This news organization, through a review of public records, has since learned that the real estate portfolio of Brookfield Properties, part of a web of offshoots of Brookfield Asset Management, is partially backed by sovereign wealth funds — made up of state-owned investments and assets — from both Saudi Arabia and Qatar.
The developer obtained capital from the venture arm of Saudi Arabia’s massive Public Investment Fund, one of the largest sovereign wealth funds in the world, which manages roughly $800 billion in assets. Additionally, the Qatari Investment Authority is the second-largest investor in Brookfield Property Partners dating back to 2014.
At such an early stage of development at the former Concord Naval Weapons Station, it’s likely too early to say whether Brookfield’s funders pose a problem for Concord.
However, Brookfield recently provoked the ire from U.S. legislators, who are scrutinizing how government officials may have used their national security clearances to help bankroll their own personal interests.
Specifically, Jared Kushner, a former White House adviser and son-in-law to ex-President Donald Trump, inked a 2018 deal to sell a 99-year lease on his family’s marquee 666 Fifth Avenue property in New York City to Brookfield Asset Management. While that $1.2 billion deal bailed Kushner’s family out of massive debts, the transaction occurred amid ongoing diplomatic operations in the Gulf.
In October, federal financial committees accused Brookfield’s management of stonewalling Congress by refusing to hand over records and answer questions about the transaction — including whether Brookfield “intentionally misled” the public when it said that “no Qatar-linked entity” had been involved in the deal.
A representative from Brookfield’s Northern California land and housing division did not return requests for comment by press time.
Guy Bjerke, Concord’s director of economic development and base reuse, said city officials knew and investigated the developer’s connections to an immense international asset management company. However, he was unaware of the specific sources of Brookfield’s finances and specific connections to Saudi Arabia and Qatar until informed by this news organization Wednesday.
Bjerke said that wasn’t an issue at such an early stage in the planning process; rather, he said Brookfield’s access to deep pockets of wealth was a key component for this massive project, which was once-estimated at $6 billion, especially in the Bay Area’s notoriously expensive development market.
Notably, the New York-based developer and real estate giant agreed to several crucial requests in order to win over the council: Designate at least 25% of the housing on the inland site as affordable, hire 40% of its construction workforce from within Contra Costa County, and prioritize connecting the community to the nearby BART station within the first phase of construction.
Additionally, the project is also expensive because nearly all of the infrastructure on the site — sewer, water, electricity, recycled water and even roads — is effectively being built from scratch.
“There’s just a super amount of investment (needed) to make the project a reality,” Bjerke said, adding that the people working with city staff are based in San Ramon and have other projects across Northern California. “Brookfield’s willingness to step up, the fact that they do have demonstrated resources to make it possible, and their vision of implementing the community’s area plan are all crucial — it’s all a package.”
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Debate about those financial risks were partially to blame for the implosion of plans with the project’s first two would-be master developers — Lennar and Concord First Partners — in 2020 and 2022, respectively.
It’s not an unusual or a new trend for overseas funds to invest in projects on U.S. soil.
Saudi Arabia, in particular, has openly expanded its reach across several global industries in recent years, arguably most publicly in the PGA and LIV Golf merger but also real estate and nuclear energy. Some politicos argue that these more public dealings are part of an effort to clean up the reputation of Saudi and its Gulf neighbors — while “buying influence.”
Sovereign wealth funds have been implicated in human rights abuses, including the acquisition of companies that are used to carry out extrajudicial killings and corrupt campaigns — including the 2018 murder of prominent journalist Jamal Khashoggi — at the behest of Saudi Arabia’s Crown Prince.
But Bob Staedler, principal executive with Silicon Valley Synergy, a land-use and planning consultancy, said Bay Area developments have tapped into this kind of overseas money for “a very long time.”
Locally in the Bay Area, Brookfield Properties alone reported at least 24 residential, office and other properties as of September.
As Concord moves forward through the long list of plans and approvals needed to finalize the project, Staedler said time will only tell whether the city’s relationship with these funders proves problematic.
“It’s great that these funds are going to come in to redevelop such a large complex development that’s needed to happen for a while now,” Staedler said. “If (Concord) can create a win-win return for themselves and remove blight from this area, then it should be good for all parties.”
But Kevin Burke, a local software developer and housing advocate who serves on the board of East Bay for Everyone, said he wishes cities such as Concord had more local options for financing housing projects other than private developers — who often end up dictating many project timelines and agreements. He said he hopes lingering financial questions about developers such as Brookfield Properties help motivate lawmakers and state agencies to support different paths forward for housing built across the Bay Area.
“The report of Brookfield taking money from nation states with questionable human rights records is a symptom of the poor process Concord has chosen for building on (the former Concord Naval Weapons Station), which is almost guaranteed to lead to bad outcomes,” Burke said. “Instead of Saudi Arabia, we would like to see the state of California, which has very low borrowing costs, a long-term time horizon, and an interest in the future of its residents step in to finance some of the development.”