On June 26, 2024, the City Council approved Ordinance No. 13801 authorizing the City Administrator to negotiate and enter into a Purchase and Sale Agreement (PSA) with the African American Sports and Entertainment Group (AASEG) for the sale of the City of Oakland’s (City) 50% interest in the Oakland Alameda County Coliseum Complex property (Coliseum Complex). On August 31, 2024, and as amended effective September 23, 2024, the City of Oakland (City) entered into the PSA, also known as the Real Property Sale Agreement, with Oakland Acquisition Company (OAC), an affiliate of AASEG.
Below are some FAQs related to this sale. FAQ's related to the City's budget are available here.
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Updated Questions and Answers Published November 7, 2024
Has AASEG made the November 7, 2024 payment required by the First Amendment to the PSA?
No. AASEG provided evidence to the City of the availability of funds reserved for the payment by making a deposit of $10 million into an escrow account in October, as required by the First Amendment to the PSA. The Amendment then requires AASEG to pay these funds into the City’s escrow account by November 7, 2024, which would be non-refundable. This payment into the City’s escrow account has not yet been made.
Why hasn’t AASEG made the November 7th payment?
As noted in the FAQs the City published in October (see below), the September 23, 2024 amendment was requested to defer the payments until after the County’s approval of the assignment of the sale agreement for the County’s 50% interest from the Oakland A’s to AASEG. AASEG is still awaiting action by the Alameda County Board of Supervisors regarding the transfer of the Oakland A’s interest in the County’s 50% interest to AASEG. The City understands the County Board of Supervisors held a Closed Session on this issue on November 7, 2024, but to date the County has not scheduled a vote on the proposed assignment. The City is hopeful that this will happen without delay. Once the County consents to such assignment, the City expects to receive AASEG’s November payment. The first payment that AASEG made to the City, of $5 million in September, remains non-refundable.
Does the fact that no payment was made on November 7th mean that the deal is off?
No. However, should Alameda County not act in a timely fashion on the assignment of the Oakland A’s interest in the Coliseum to AASEG, the City could find AASEG in default of the PSA. The sale and subsequent redevelopment of the site would then be in question.
Does the failure to make the November 7, 2024 payment impact the City’s current-year budget?
No. Even if the $10 million had been moved into the City’s escrow as scheduled, that payment would not have been accessible by the City until the bonds are paid off and the property transfers.
In the meanwhile, has any progress been made on early payment of the bonds that would enable closing this fiscal year?
Yes. The City brought a motion and the Oakland-Alameda County Coliseum Authority Board, which is the entity with the authority to pay off the bonds, passed a resolution on November 4, 2024, consistent with the City’s PSA authorizing the redemption or defeasance of the bond no later than June 30,2025, subject to completion of due diligence, evaluation and analysis by Authority staff bond counsel, financial advisors and other consultants as necessary to complete the transaction. The Authority staff is now implementing the resolution. This timing is consistent with the City PSA. on November 4, 2024, consistent with the City’s PSA authorizing the redemption or defeasance of the bond no later than June 30,2025, subject to completion of due diligence, evaluation and analysis by Authority staff bond counsel, financial advisors and other consultants as necessary to complete the transaction. The Authority staff is now implementing the resolution. This timing is consistent with the City PSA.
Does the recent election affect the City’s deal to sell the Coliseum to AASEG?
No. The election has no impact on the sale, which was approved by the City Council on June 26, 2024 and is being implemented by the City Administration.
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Questions and Answers Published October 11, 2024
What land is included in the Coliseum sale?
The Coliseum Complex is approximately 112-acres in size and abuts the Damon Slough Channel to the North and East, South Elmhurst Creek Channel to the South and Coliseum Way and I-880 to the West. The site consists of two parcels that include the arena, stadium, parking areas, and related structures, circulation spaces, and loading areas. The City and Alameda County each own an undivided 50% interest in the property.
Why did the City sell its 50% undivided interest in the Coliseum?
The Coliseum Complex is one of the City’s largest development sites and presents an opportunity to bring needed investment, jobs, and amenities to East Oakland and to the region. After serving its purpose for generations, creating a home for championship sports franchises, and with the bonds used to fund past improvements scheduled to be paid off (i.e., defeased) next year, the time is right to think about the future of this site. In preparation for this moment, the City adopted the Coliseum Area Specific Plan in 2015, which defines a new mixed-use vision for the property, which includes new housing, retail, commercial space, sports, and entertainment uses. Against this backdrop, the City Council directed that the property be sold to a development entity that could help realize this vision.
Who is AASEG, Loop Capital and OAC?
The City sold its share of the property to the Oakland Acquisition Company (OAC), a partnership of the African American Sports & Entertainment Group (AASEG) and Loop Capital. Based in Oakland, AASEG was founded in 2020 with the primary purpose of using the vehicle of sports and entertainment to create a path for enhanced economic equity for the black community. Loop Capital is AASEG’s investment partner and is a full-service investment bank, brokerage, and advisory firm based in Chicago, IL. For the purposes of this FAQ, the terms OAC and AASEG are used interchangeably to refer to the buyer of the property.
How much will AASEG pay for the City’s 50% undivided interest in the Coliseum?
AASEG will pay the City of Oakland a total of $125 million. AASEG will pay the first $110 million by May 30, 2025 (during the City’s Fiscal Year 2024-2025) according to the following schedule:
- $5,000,000 by September 1, 2024
- $10,000,000 by November 7, 2024
- $95,000,000 by May 30, 2025
AASEG will pay another $15 million in the future, as development occurs on the site, in accordance with the following schedule:
- $5,000,000 after building permits have been issued for more than 25% of the Coliseum Parcel
- $5,000,000 after building permits have been issued for more than 50% of the Coliseum Parcel
- $5,000,000 after building permits have been issued for more than 75% of the Coliseum Parcel
Each of these future payments will be adjusted annually by the Consumer Price Index (CPI) to keep up with inflation.
When did the City approve the sale of the property?
On June 26, 2024, the City Council approved Ordinance No. 13801 authorizing the City Administrator to negotiate a sale of the City’s 50% interest in the Coliseum Complex to AASEG for $105 million. On August 31, 2024, the City entered into a PSA (i.e., the Real Property Sale Agreement) with Oakland Acquisition Company (OAC), an affiliate of AASEG. The PSA was then subsequently amended on September 23, 2024 to increase the sales price to $125 million, among other revisions.
Why was the initial PSA amended on September 23, 2024?
AASEG requested an amendment to the PSA to provide more time for Alameda County to approve assignment of their pre-existing purchase contract with the Oakland Athletics (A’s) to AASEG. Specifically, AASEG asked to defer some early payments until after the County’s approval of the assignment. In exchange, the amendment increased the total compensation paid to the City from $105 million to $125 million, increased the amount paid in the current fiscal year from $63 million to $110 million, and accelerated closing so that the City’s interest in the property is sold by May 30, 2025.
Was City Council approval required to amend the PSA?
No. The ordinance that the City Council approved on June 24, 2024 that authorized the sale of the City’s 50% interest in the property to AASEG required that the City’s 50% interest in the property be sold for $105 million, with at least $63 million to be paid by June 30, 2025. The ordinance authorized the City Administrator to negotiate and execute “such other additions, amendments or other modifications to the foregoing document that the City Administrator, in consultation with the City Attorney’s Office, determines are in the best interests of the City, do not materially increase the obligations or liabilities of the City, and are necessary or advisable to complete the transactions contemplated by this Ordinance.” The amendment was consistent with these criteria and was signed by both the City Administrator and the City Attorney.
Did the authorizing ordinance require a specific payment schedule?
No. The ordinance the City Council approved on June 26, 2024 approving the sale authorized the City Administrator to negotiate the terms of payment, including the payment schedule.
Has AASEG made all required payments?
Yes, AASEG has made all required payments. The PSA required that AASEG make an initial payment of $5 million by September 1, 2024. Since this date fell on a weekend when banks are closed and in accordance with the PSA, AASEG made this first payment on September 3, the next business day. The next required payment is $10 million. Under the PSA, AASEG must provide evidence to the City’s satisfaction that the funds have been assembled in escrow for payment by October 7, 2024, which they have done, and the payment becomes due on November 7, 2024. See above for more detail on the payment schedule. At no time has AASEG defaulted on its contractual obligations.
What happened to the Exclusive Negotiation Agreement (ENA) between the City and AASEG?
In November 2021, pursuant to Resolution No. 88922, the City Council authorized the City Administrator to enter into an 18-month Exclusive Negotiating Agreement (ENA) with AASEG. The ENA expired on July 25, 2024.
How much debt is outstanding on the Coliseum and Arena bonds?
The City’s share of the current outstanding bond debt related to the Coliseum stadium improvements is approximately $12,805,125 and is scheduled to be fully defeased (i.e., paid off) by June 30, 2025. The City’s share of the existing outstanding bond debt related to the arena improvements is approximately $12,871,258 and is scheduled to be fully defeased by June 30, 2026. However, by the time the sale is scheduled to close on May 30, 2025, the Coliseum bond debt will be fully defeased and only $4.2 million in arena bond debt will remain.
What happens to the outstanding bond debt as part of the sale?
The PSA sets forth that the sale of the City’s 50% interest in the property shall be completed by May 30, 2025. This requires that both the Coliseum and Arena bond debt be paid off in full (defeased) by that date. The PSA obligates AASEG to pay all costs of defeasing the bonds by this date, including the full amount of any outstanding bond debt owed by the City and County at that time.
Didn’t the County sell its 50% ownership stake in the Coliseum to the A’s?
Yes. In late 2019, Alameda County agreed to sell its 50% undivided interest in the Coliseum Complex to the A’s for $85 million, to be paid over 7 years. This is known as an installment sale. The sale is scheduled to close in 2026, meaning ownership of the County’s 50% share is scheduled to transfer to the A’s that year. Under the terms of the County’s agreement, when the A’s announced relocation outside of Oakland, all unpaid installments became immediately due and payable.
Didn’t AASEG purchase the County’s share of the Coliseum from the A’s?
AASEG entered into an agreement with the A’s to purchase the A’s position in their purchase contract for the County’s 50% interest. The Alameda County Board of Supervisors has to approve the assignment of this purchase contract to AASEG in order for AASEG to actually purchase the County’s share.
Isn’t the County’s sale to the A’s being challenged by a third-party lawsuit?
The County’s sale to the A’s is currently the subject of an ongoing lawsuit, brought by third parties, alleging violations of the State Surplus Lands Act.
Did the City follow the requirements of the state’s Surplus Land Act (SLA) before selling its ownership interest to AASEG?
Yes. In January 2020, the City Council adopted Resolution No. 88000, which ratified earlier actions and declared the City’s 50% interest as surplus land under the SLA and authorized the City Administrator’s issuance of a Notice of Availability to solicit interest in the Coliseum. In December 2021, the California Department of Housing and Community Development indicated they had no significant concerns warranting a findings letter within its thirty (30)-day review period regarding the City’s compliance with the SLA. Therefore, the City has complied with the SLA.
Does this sale authorize any specific redevelopment project?
No, neither the ordinance authorizing the sale, nor the PSA, approved a specific development project on the site. In the future, AASEG will need to propose a specific project and seek zoning and other discretionary approvals from the City – separate from and beyond the PSA.
What about the Coliseum Area Specific Plan that was adopted in 2015?
Any development on the site must conform with the Coliseum Area Specific Plan (CASP). The CASP was a City-led planning effort that involved years of analysis by City staff, outside consultants, and community stakeholders. In March 2015, pursuant to Resolution No. 85491, the City Council certified the Environmental Impact Report, made California Environmental Quality Act (CEQA) findings, and adopted the CASP. The CASP provides a detailed guide to maximize efficient utilization of the existing infrastructure, recommends improvements to the existing site, and recommends densities, land uses as well as new mixed-use development. AASEG plans to develop the site consistent with the vision contained in the Specific Plan.
Will AASEG be required to provide community benefits to develop the Coliseum?
Yes, the ordinance authorizing sale of the City’s 50% interest required that AASEG participate in a good faith negotiation process, including but not limited to, labor agreements and labor peace; local and small business contracting goals; workforce training and local employment provisions; living wage; public open space and parks; sustainable and green development standards; transportation infrastructure and transportation demand management programs including transit affordability and accessibility; anti-displacement and housing preservation policies; City participation in profit-sharing; and other community benefits. To ensure compliance, the PSA provides that this requirement will be written into the deed by which the property is conveyed to AASEG.
Will affordable housing be required if housing is developed at the Coliseum?
Yes, the ordinance authorizing sale of the City’s 50% interest required that at least twenty-five percent (25%) of any residential units built on the property in the future be designated as affordable for households earning up to 60 percent (60%) of Area Median Income (AMI), with at least ten percent (10%) being made available to households earning up to thirty percent (30%) of AMI. To ensure compliance, the PSA provides that this requirement will be written into the deed by which the property is conveyed to AASEG.