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Chairman Willie: Willie Brown's Not-So-Secret Connection to the Hunters Point Project 

Wednesday, Jul 17 2013

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The investment brochures, like the online materials, refer to Brown as a company "principal." During the seminar, a presenter described Brown several times in connection with the regional center as "dong shi zhang," or "chairman of the board." Fang says Brown is not chairman but, after being provided a tape of the presentation, acknowledged that was what he was called. She offered no further explanation.

A video featuring Brown led into the April 14 sales pitch. It was shown before a presenter told attendees that 50 investments already had been made, with 40 remaining.

"I am Willie Brown, former mayor of San Francisco and, of course, former speaker of the California Assembly, and I am a principal in the San Francisco Bay Area Regional Center," Brown says in the video. "I am just delighted to be a part of this."

But at a City Hall speech Lee gave on May 21, Brown brushed off this reporter's request to discuss the regional center.

"I have no idea what you're talking about," he said.

"You don't know what the San Francisco Bay Area Regional Center is?"

"Nope," Brown said, before excusing himself.

At the June 26 Hunters Point groundbreaking, Brown wound up the ceremony by touting the project's moneymaking potential. The regional center was never mentioned.

"The investment opportunity here represents something that's unique in America," he said. "There is no other piece of soil as potentially lucrative and profitable for the public sector and private sector than this spot is going to be."

Asked at the event what he expected the San Francisco Bay Area Regional Center's profit to be, Brown said: "I don't know what that is. I don't know what that is. I don't know what that is."

Lee likewise initially claimed ignorance about the regional center. Asked at a May 30 ribbon cutting to comment on the San Francisco Bay Area Regional Center, he said, "I can't say that I have much detail on that."

However, in an interview at the groundbreaking, Lee acknowledged that the first phase of construction would be financed by the regional center. The center's partner, Lennar Urban, previously installed streets and sewers at the Hunters Point project site but delayed construction, citing lack of money.

"The ones taking the risk and putting infrastructure into the ground, that's Lennar," Lee said. "And they've been doing a really great job."

Before the event, regional center CEO Fang said her company would fund part of the first phase of Hunters Point construction, referring specific questions to Lennar Urban. Company president Kofi Bonner, who served as San Francisco's director of economic development while Brown was mayor, did not answer questions.

"We don't discuss financing," Bonner says.

But San Francisco Chronicle columnist Andrew S. Ross later cited Bonner saying the project had $77 million committed from 154 foreign investors through the visa program. (Bloomberg and other news agencies also reported on June 28 that TPG Credit Management LP has purchased a minority stake in the project.)

The regional center fundraising followed a government lobbying campaign to allow the Brown-linked firm to participate in the immigration visa program. In a letter to the U.S. Department of Homeland Security, Pelosi — a longtime Brown ally — wrote that "it would be in our national interest" to allow the firm to collect fees and returns under the investment visa program.

The Sept. 18 letter sought to get U.S. immigration authorities to fast-track the regional center's visa program certification. It was part of Pelosi's efforts to bring jobs to low-income sections of her congressional district, her press secretary wrote in a statement in response to this reporter's questions. "By incentivizing private investment to the redevelopment of the Hunters Point Naval Shipyard, the shipyard will be transformed into a source of local jobs and economic into this disenfranchised community," the statement says.

In her letter to Homeland Security, Pelosi wrote that the government so far has spent $1 billion at Hunters Point, with most of the money going to toxic and radioactive waste cleanup.

The project still requires $3 billion to pay for infrastructure and $7 billion for planned apartments and office space, yet neither the city nor Lennar has been able to come up with the necessary funds, Pelosi wrote.

According to Pelosi, U.S. Citizenship and Immigration Services needed to authorize the San Francisco Bay Area Regional Center to solicit funds under the Immigrant Investor Program, so the city could "proceed with the remainder of the project without delay."

To that end, the City and County of San Francisco's lobbyist, Eve O'Toole, joined the effort last September, also pressing U.S. immigration officials to fast-track the application, according to internal emails.

The city government may have opened itself up to liability by helping in the sale of securities, says Michael Gibson, who leads a Tampa, Fla., firm that audits regional center investment firms using the federal investor visa program. "When they say certain things about the project that may turn out to not be true, and if residents lose their residency, or lose their money, they could be held liable for those representations," he says. If the project's investors don't get their money back, or obtain a visa, they could sue the city because of the extent of its involvement, says Gibson.

In March, Wells Lawson, Lee's aide overseeing the Hunters Point project, traveled to China and Japan for at least two weeks to help with seminars marketing shares in the company to potential investors. The regional center paid for all of Lawson's travel expenses, including more than $1,300 in plane tickets, says Leo Levenson, the city accountant who tracks government finances related to redevelopment projects such as Hunters Point.


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