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Real Estate Developer Takes BART For Ride 

Wednesday, Feb 24 2016
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Aside from playing on your phone and trying not to get chin-checked on the escalator by an outlaw bike, there's not much for riders to do in most BART stations aside from wait. BART's management, however, wanted something more — namely, produce markets, newsstands, and other shopping options — in all 44 stations. Since stores are a proven moneymaker in other transit agencies, in 2011, BART awarded a contract giving control of retail to a politically connected company called TransMart.

Almost five years later, aside from two TransMart kiosks offering "unique brand experiences" at Montgomery and Embarcadero stations and an app called "blinq" — which offers something called an "online to offline retail ecosystem" — BART is still waiting for TransMart to arrive.

What happened? The tale begins in 2008, when BART received an unsolicited bid from Alexis Wong, principal of trans-Pacific real estate investment firm AGI Capital, to become BART's master retail developer. BART officials met with Wong in May 2008, according to emails obtained via the California Public Records Act, and offered her the store: BART gave her station floorplans, information about existing station concessions, and even staff time. Internal emails show that BART Property Development Officer Paul Voix offered to help point out "specific potential locations within each station."

Things were humming along like a Sunday train until BART Director Tom Radulovich, who represents most of San Francisco, noticed that nobody else was competing for the public contract.

"The initial BART reaction was, 'Sure.' I said, 'Well, hold on. One choice is no choice. Maybe we should see if anyone else is interested,'" Radulovich told SF Weekly.

So BART staffers dutifully issued a "request for qualifications," the typical precursor to a bid for a public contract — except this RFQ was mysteriously similar to Wong's initial bid. In the end, eight companies put in bids, but only TransMart, Wong's newly formed company, met all the criteria and was awarded the contract in 2011.

"BART staff basically took [TransMart's] bid and turned it into a proposal that described their bid," Radulovich says. (Today, BART claims it isn't sure who came up with the master retail vendor idea in the first place.)

The favorable treatment also smells of pay-to-play. In 2008, after Wong first approached BART, she also wrote a $2,500 campaign contribution for the reelection bid of former BART Director James Fang, who was for years the city's lone elected Republican. Sure enough, when the TransMart deal came before the BART Board of Directors, Fang spoke heartily in support, a recording of the meeting shows — and the item passed eight to one, with Radulovich the lone dissenter.

(BART directors can receive donations from companies contracting with the agency, a fact bemoaned by ethics experts.)

Fang was voted off the BART Board in 2014. Neither he nor TransMart responded to requests for comment by press time.

In November, more than four years after the contract was awarded, TransMart has brought in a subcontractor to handle the fixed retail.

Meanwhile, BART has missed out on millions in possible annual revenue. And riders are still waiting, with nowhere to shop but their phones.

About The Author

Alexander Mullaney


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