I’ve been sort of ignoring the whole Ron Cowan/Harbor Bay Club swap-y thing lately because it’s kinda reached levels of absurdity. When last we left this saga Ron Cowan had sent out menacing emails and I actually never wrote about Ron Cowan’s latest plan to build a hotel in the place of the Harbor Bay Club if his residential development was not allowed to move forward. FYI, don’t visit the website for the architecture firm, it is the most obnoxious thing ever.
I mean, is there a lot more than that? Ron Cowan says that he wants to build a hotel and “conference center” if the City opts not to rezone the Harbor Bay Club to residential. Because lots of people have expressed a desire for hotel space on Bay Farm Island. Right? The whole plan for the hotel is to put up an alternative — a less desirable alternative but not so outlandish that it doesn’t pass the laugh test — that would be objectionable to neighbors that they might reconsider the houses as the lesser of the two evils.
Although it would provide an Alameda alternative for the occasional wedding, but honestly if you wanted to have a hotel setting that would be perfect for weddings, might I suggest the site that Harbor Bay just had rezoned by the City Council? It’s right on the water which would present beautiful views for photos and things.
Anyway, apparently one the big reasons that Harbor Bay Club is saying that they have to move is because the Club isn’t doing well in the location that it’s currently in. According to research by the Harbor Bay Neighbors, that’s not precisely right:
In 2008 HBIA, using a side company called Harbor Bay Club Associates LP, took a $6 million loan against Harbor Bay Club and then rolled that into a $7 million loan in July 2013. (Read the public loan documents from 2008 and 2013)
A loan of this magnitude typically requires the cash flow from the business to be at least 120% greater than the debt service and the loan amount to be no more than 65% of the value of the collateral (in this case the land). So, despite the payments on a $7M loan, the Club is generating a sizable income stream for HBIA. Cowan also has millions of dollars worth of equity in the business, which he would hardly walk away from by going out of business. No one with any financial sense would be so fiscally irresponsible as to default on a profitable a business like this, especially a multi-millionaire developer.
This financial revelation changes everything. It reinforces that HBIA is not concerned with providing a quality facility (or they would have reinvested a chunk of that $6M from 2008 into deferred maintenance at the existing Club) and proves the Club is financially stable with no threat of closure.
I will add that I’m not opposed to the whole Ron Cowan housing plans or Ron Cowan hotel plans because I’m clutching my pearls about traffic, density, evacuation routes or anything around those topics. Because really none of this affects me because it’s on the other side of the Island. What I do object to is the sense of entitlement that Ron Cowan has where he thinks that he is “owed” these homes or “owed” a way to squeeze every last dollar out of Alameda that he possibly can. He planned this development from the very beginning, he could have maximized the development from the start and maxed out his unit number from the very beginning and no one would have said boo about it. He chose instead to build what is currently there and elected not to be judicious about how large he made the lots, styling Harbor Bay as a more traditional suburban development and there is nothing wrong with that. What is wrong is his attempts to undo what he has already done and built.