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A Dream Grows in the Barrio

Fruitvale Transit Village is built around two buildings lining a plaza. It includes a wide pedestrian walkway connecting the BART station and a bus station to the neighborhood's central shopping district; a 16,000 square-foot child development center for 200 infants, toddlers and preschoolers with a spacious, tree-dotted play area; the 15,000 square-foot C´esar Ch´avez branch of Oakland's public library, with the city's most extensive collection of Spanish-language resources; a computer technology center for job training and educational enhancement; La Cl´inica de la Raza, originally a pioneering local health clinic, now a 40,000 square-foot state-of-the-art health facility with 130 people staffing a medical lab, pharmacy, X-ray center and 10 dental chairs; 10 units of affordable housing; 37 market-rate units with large decks; a lively senior center called Las Bougainvilleas; commercial development that includes doctors' offices, a range of restaurants and stores, 80 percent of which are reserved for local merchants, and a retail branch of Citibank, which underwrote $27 million in funding for the project. The official estimate is that Fruitvale Village will result in 700 to 1,000 new jobs for the neighborhood.
Connecting the Dots

Since 1971 the Ford Foundation has made grants totaling $9 million to Fruitvale's Unity Council. Foundation funding for Fruitvale Transit Village is part of a larger initiative that is supporting efforts to connect neighborhood development with regional efforts to reduce poverty and injustice. Grants have assisted transit-oriented projects, mixed-income housing and the creation of vibrant public spaces, such as the Fruitvale project. The work seeks to harness the dynamics of changing demographics, market forces and social justice to forge new approaches to community development.

Fruitvale by the Numbers

* Per capita income is $11,814.

* In 1999, 24 percent of the population was living below the poverty level.

* The average household size is 3.7, compared to 2.6 for Oakland as a whole.

* Only 31 percent of housing units are owner-occupied, compared to 41 percent for Oakland as a whole.

* Foreign-born residents make up 47 percent of the population. Places of birth include Bosnia and Herzegovina, China, Pakistan, Cambodia, Laos, the Philippines, Thailand, Vietnam, Mexico, El Salvador, Guatemala and Honduras.

* The population is 7 percent white, 19 percent African-American, 17 percent Asian, 53 percent Latino and 4 percent other.

* The residents are young: 32 percent of the population is under 18, 54 percent is under 30.

* Spanish is spoken in 43 percent of the homes. Of these households, 40 percent are linguistically isolated, that is, all family members over 14 have difficulty with English. An Asian language is spoken in 16 percent of the homes. Of these, 45 percent are linguistically isolated.

* Only 51 percent of adults have a high school diploma. Only 10 percent have a college degree.

* Most residents work in construction, manufacturing, retail, health care, food and other service industries.

Source: Main Street Program






In Transit

It has taken more than a decade, but Oakland's Fruitvale neighborhood is coming back to life in a big way.

by Elizabeth Blish Hughes

Spring 2004


Oakland, Ca.—Life is not easy in the Fruitvale district of Oakland. Per capita income is under $12,000 a year and nearly a quarter of the people live below the poverty level. A predominantly Latino neighborhood, Fruitvale is also home to people from China, Pakistan, Cambodia, Laos, Thailand, Vietnam, the Philippines and the Balkans. Foreign-born residents make up 47 percent of the district's population. About half of the adults have a high school diploma; only 10 percent have a college degree.

Yet Fruitvale is a place that has come to believe in itself and its future. The story of how that came to be has much to do with Fruitvale's most venerable neighborhood organization, the Spanish Speaking Unity Council, and its equally venerable leader, Arabella Martínez. Both instructive and inspiring, the story is perhaps better termed a saga. At its center is more than a decade of struggle by Fruitvale's residents to assert their community's identity and their claims to a better life. It culminates in the construction of a $100 million community development project, called Fruitvale Transit Village, that is built around a rapid transit station and a bus hub. It is nothing if not out of the ordinary.

The story begins in the 1960's, when the Bay Area Rapid Transit system (BART), the San Francisco region's mass transit agency, broke ground for a station in Fruitvale, promising it would help bring economic development. That did not happen, but neither did the neighborhood rise up in protest. So when BART officials, in 1990, began planning to build a parking garage between the station and Fruitvale's main shopping strip on International Boulevard, they didn't ask for the views of residents of what seemed like just another hollowed-out, inner-city area along BART's routes to suburban satellite office centers. BART riders needed parking, which the garage would provide. It was as simple as that.

The officials were wrong. When Fruitvale residents learned about the plan the following year during an environmental hearing on construction of the garage, "BART ran into a firestorm," says Jeff Ordway, BART's manager of property development. "It wasn't that the community didn't want the parking. The point was that the parking was in the wrong place. The garage got stopped dead.''

That was 13 years ago. Now the garage — positioned so it does not cut off the station from the neighborhood — is one element in the Fruitvale Village project, which contains a range of others, from a health clinic to a child development center to a computer technology job-training center.

The project has become a national model for transit-oriented design in a high-density, inner-city neighborhood. It is also a reminder that community building is a complex process that takes time as well as funders with the vision to be flexible and patient.

Leading the drive for Fruitvale Village was Arabella Martínez and the organization she helped found in 1964, the Mexican American Unity Council, later renamed the Spanish Speaking Unity Council to reflect the influx of Latinos from Central and South America into the neighborhood.

Martínez left the organization in 1974. She was subsequently appointed an assistant secretary in the U.S. Department of Health, Education and Welfare in the Carter administration. She returned to the Unity Council in 1989, when she was asked to lead the organization through a time of crisis. It had $3 million in short-term debt, service programs operating at a loss and development projects teetering on the brink of foreclosure. Martínez faced two options: Close the council or revive it.

She chose the latter, which surprised few. "She had bought into the vision that a community development organization that was well-designed could make a difference," says Raul Yzaguirre, president and C.E.O. of the National Council of La Raza, who has worked with Martínez for more than 30 years.

BART became involved in the Fruitvale Village project when it bowed to community opposition, led by Martínez and the Unity Council, to the parking garage. "They never thought they'd find an organized community voice in a lower-income community," says Manuela Silva, senior executive officer of the Fruitvale Development Corporation, the Unity Council's real estate arm. But that's what BART found. "What Arabella brought back to the Unity Council was the awareness of a great purpose," says Silva.

In 1992 BART officials signed an agreement on Fruitvale Village with the Oakland City Council and meetings began. Nearly two years later, this phase culminated with the Spanish Speaking Unity Council — now known informally as the Unity Council to reflect the influx of Southeast Asian and Eastern European refugees into the neighborhood - scheduling a meeting on a Saturday morning so local residents could review project plans. The architects decided to offer a single solution to the neighborhood's complex needs.

BART's Ordway recalls the scene. As the presentation ended, one man pointed to a set of also-ran drawings on the wall, saying he thought a pedestrian plaza, or walkway, between the BART station and International Boulevard was a good idea. Other people weighed in. By the end of the meeting, there was fervent community support for the walkway.

"It's a place that's been waiting to happen for a long, long time," says Pat Cashman, a board member of the local development corporation who first saw the need for a pedestrian connection between the BART station and International Boulevard when he was a graduate student of architecture in 1971. No matter how logical the connection may have seemed, however, Ordway says, "without the Unity Council, the community would not have stood up and said ‘This is what we want.'"

Nevertheless, Fruitvale still lacked a comprehensive plan. "We knew that it had to be on a significant scale if it was to have enough impact to transform the community," says Silva. "The transformation had to address social, physical and economic conditions.''

Meetings were convened. Funds were raised. Decisions were made. Despite all the effort, however, the project existed for years only as drawings and talk. Silva remembers thinking the project "was like the Bible. Whatever your preference, or your religion, everyone reads the same book but gets something different out of it. Every feasibility study said it couldn't be done."

Other things were getting done, however. The Unity Council started financial education classes to help prepare residents to buy their own homes. It coordinated a home-improvement program with a local Sears store. Martínez and the Unity Council also attracted the attention of the National Trust for Historic Preservation, which, since 1980, had been using historic preservation as a tool for commercial revitalization in suburban and rural areas desolated by malls. Preservationists itched to take on inner-city shopping areas. They knew community support was the key to success and that a commercial district had to be made attractive if businesses were to succeed.

In 1996 the Unity Council launched the Main Street Program, a pilot project for the National Trust. With help from the program, Fruitvale businesses began sprucing up their buildings. More than $4 million in public funds and $3 million in private funds were invested in the business district. The program also raised more than $2 million for street improvements, expanded the annual Dia de los Muertos Festival into a regional attraction that drew 80,000 people in 2003, and established a zero-tolerance anti-graffiti program. In six years, the Main Street Program created 224 new jobs and assisted in the growth of 66 new businesses.

Fruitvale merchants formed a business improvement district in 2001, voting to tax themselves about 14 cents a square foot to raise $200,000 annually. The money pays for daily sidewalk sweeping. The tax also pays "ambassadors" wearing blue and white striped shirts to patrol the street, reporting anything amiss to the Oakland Police Department. Crime dropped in the district and shoplifting is now the main worry, according to Jenny Kassan, who oversees the Main Street Program.

A shopping center opened on the other side of International Boulevard, on the site of a former cannery, in October 1997. It was the first development of its kind in 25 years and included a chain supermarket, an auto supply center and a Starbucks that is a joint venture with Magic Johnson's Urban Coffee. Today the center has 18 retailers.

As the local merchants began seeing the neighborhood improve, the transit village project ran into another problem. La Clinica de la Raza, a local health clinic which had started in 1971 with five volunteers and grown to be the largest employer in Fruitvale, was going to be one of the project's anchor tenants. But Silva learned that its funding depended on its owning the new facility and the land it was to be built on. "So we had to subdivide the land and sell them a parcel," says Silva.

That was just one of the funding conflicts the project faced. For example, some $14 million in grants and loans for the project came through the city, each with a different set of rules, often in conflict.

As Martínez chased funding, she risked losing time-defined money obtained from other sources. By 1998 it was clear that one person had to oversee the project or it wouldn't get built. Martínez tapped Manuela Silva, who had joined the Unity Council staff in 1990 with a background in developing affordable housing.

Silva put together a proposal suggesting that funding sources loosen up; if a specific use wasn't prohibited, she asked them to accept that "it doesn't say you can't.'' There were more than 30 funding sources for the transit village project. Silva took her message to each one. "Usually, people make decisions on what they believe they can't do, but that eliminates the possibilities and I couldn't work that way," Silva says. Martínez and the Unity Council leveraged public dollars and grants, notably $25 million in public funds for the project. The two women developed a style that let them play to their respective strengths. Martínez focused on the social goals. Silva imposed the discipline needed for successful real estate development.

"This was an incredibly complex project, and it took somebody like Arabella to keep all the balls in the air," says La Raza's Yzaguirre. "She can work with anybody. She listens to people."

The core of Fruitvale Village, two buildings lining a pedestrian plaza, remained the goal. The plaza and transportation were central to the plan. Connecting Fruitvale to the rest of the region was crucial because it meant local residents would have better access to jobs, and businesses would have better access to customers. "In new immigrant households, if they don't have transportation choices, they're locked out of mainstream America," Silva says. "We wanted the pedestrian plaza to invite people from the community to ride BART, and we wanted to make the plaza a center of celebration and community life."

Still, for six years, the project moved slowly, a dream consisting of drawings and near-endless talk. "If you were discouraged, Arabella would pump you up," says Ordway. "She never lost sight of the vision."

"For-profit people would have pulled the plug on that project 10 different times,'' says Pat Cashman, F.D.C. board member. At least one private developer invited to participate backed off, saying the project was too complicated and too difficult with too much uncertainty for returns. "Arabella said, ‘Maybe for them,'" Cashman recalls, but not for her and the Unity Council.

Several banks were interested in the financing but faced with Silva's untested model, which showed that the estimated net operating income from the project could support almost $30 million in debt, they dithered. Silva then approached Citibank, which dispatched Steven Hall, deputy director of community development. "After meeting with Arabella and Manni, walking through the model and how they expected it to be used, we really didn't see much risk in this," Hall says.

By that time, Fruitvale was harvesting the benefits of a decade of Martínez's leadership. Indeed, by 2001 there were almost no vacancies on International Boulevard, and Fruitvale had become Oakland's second largest generator of sales tax revenue.

Citibank became the sole conventional lender, providing $27 million in construction and permanent financing. Another investment banking firm acted as project underwriter and marketed the tax-exempt bonds issued by the City of Oakland. Citibank's financing covered $19.8 million for the project and an additional $5.8 million for La Cl´inica de la Raza. In addition, Citibank's Social Investments Group provided $1.4 million in equity-like debt as a matching source for other funders. The money went to the Fruitvale Development Corporation on Dec. 21, 2001. A year later, construction was at the halfway point. The first phase of Fruitvale Village was completed 10 months later, in October 2003, and was marked by a gala celebration.

Despite awards and acclaim, there are skeptics. One, John Landis, chairman of the University of California at Berkeley's department of city and regional planning, says that it will take at least five years to see if the project can sustain itself. If tenants like the Unity Council move out to make way for businesses when market rates increase, Landis says, that will be a sign of success.

There are also worries about maintaining the often tense balance between improving a low-income community and defending it against gentrification, a constant challenge in the Bay Area's overheated real estate market. Yet Landis thinks there is not yet evidence that Fruitvale Village will cause anything more than interest in the neighborhood. Others familiar with Oakland say grittier, mixed-use areas with more warehouse, shipping and factory space are more likely targets of gentrification. Nonetheless, home prices in Fruitvale, admittedly low to start with, rose 43 percent last year, the second steepest climb in Alameda County.

The big question remains: Can Fruitvale Village be a model for similar transit-oriented projects elsewhere? At least two other Oakland communities are already pursuing their own versions. Martínez would also like to see the Unity Council reinvent part of itself as a consulting team for similar projects. "The Unity Council has the technical capacity, and it would be a source of revenue," she says. There is virtually total agreement, however, that Fruitvale Village cannot be a financing model for other nonprofits. In any case, Cashman says, "Being the pioneer was difficult. Would you replicate something if you knew it would take all those years and all that money? Probably not, but I don't think the next one will."

With 40 years behind it, the Unity Council had a reputation for delivering, but, like Martínez, it also had the experience to know a project like this couldn't be done alone. Like Martínez, too, the council knew where and how to build coalitions, and as importantly, they knew that a neighborhood's people and institutions must play key roles in building their community. "The message may be as simple as that its success is rooted in the community," says Ordway, "and without that, a project like the transit village is simply not going to work."

The next phase of realizing Martínez's and the Unity Council's dream of a "vibrant and livable community" includes about 215 more housing units, a seven-acre waterfront park on nearby reclaimed land, a public market, a land bank to prevent local businesses and residents from being displaced by rising property values, and Martínez's retirement.

The housing should be completed by 2008. Martínez expects to leave later this year. Her exit, she says, will be preceded by intense fund raising to ensure the Unity Council maintains fiscal strength. She realizes that because of its growth, the council needs a better system for tracking performance, and for tracking paper. It needs a chief financial officer, not just accountants.

But what it needs most, it already has — a vision — thanks to Martínez. "Arabella once told me that a lot of what I considered vision was actually experience," says Manuela Silva. "And at some point, I started seeing the vision. I think that is how the baton is passed on."