• The proposed fees have a long way to go before they are approved
  • The city has a pipeline of housing development, but acknowledges only limited development has commenced
  • Appears some multifamily developments may be delayed or nixed in the city moving forward.

Maximum new housing fees proposed by the city of Oakland are unlikely to be the actual rates approved; however, the city’s intent to noticeably increase the cost of new housing projects should alert builders.

And it could have an overall impact on Oakland.

In a recent study, the city unveiled the maximum fees it could charge homebuilders and developers for housing projects.

For single-family detached homes, the maximum fees range from $64,009 to $110,905, depending on location within the city. These totals include affordable housing, transit and capital improvement-related fees.

The city did acknowledge that “the maximum legal fee amount is typically higher than the amount that can feasibly be supported by new development.”

Erika J Mitchell / Shutterstock.com

Erika J Mitchell / Shutterstock.com

The actual rates will be determined following public feedback, discussions with developers and advocates and city council action. The first public hearing will be held December 15, so these proposed fees have a long journey before city council consideration.

Under the maximum fees cited, a single-family detached “urban” home could be charged up to $64,009. Builders of single-family homes in the city’s Hills area would be subject to fees up to $110,905 per home. Townhome fees could total up to $78,152.

The proposed fees seem to be targeted more at multifamily projects, as Oakland has a pipeline of developments lined up that have yet to break ground. The city notes that “only limited development” has occurred so far.

Rising average asking rents in the city — $2,807 as of the second quarter — suggest that demand for new multifamily development exists. If fees approved are too high and collected too early in the construction process, a number of proposed projects could be halted.

For low to mid-rise multifamily projects with fewer than 100 units, the proposed maximum fees are $55,909 per unit. Total fees per unit for 100-unit plus midrise and high-rise projects are $60,624 and $71,541, respectively.

Email Erik Pisor

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