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River Islands: A 26-year study in patience

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POSTED March 12, 2014 1:25 a.m.

Stewart Tract in 1988 was the last place anyone except the principals of Somerston Group thought could be transformed into a cutting edge, planned community with 11,000 homes.

The 4,800 acres of the outer Delta island routinely flooded. The water table was so high that in the winter water would seep to the surface. It was a place of melons and pasture with an orchard nestled against the levees near the Mossdale railroad bridge that crosses the San Joaquin River.

Stewart Road’s washboard surface zigzagged along a drainage ditch toward Tracy. 

The tract’s most enduring attraction was Cohen Road that ran along the spine of a levee for a half mile where the main channel of the San Joaquin split from the Old River. It was here that dozens of fishermen — primarily immigrants – would park their vehicles and carry lawn chairs down to the water’s edge and fish for dinner.

Even though the county general plan identified Stewart Tract for possible housing by the time the mid-21st century rolled around, very few people thought it was possible.

But then again, they had never met Alan Chapman.

Chapman is the executive director in charge of the United States holdings of Somerston Group. The privately owned England-based firm owns Cambay Group, the developers of River Islands at Lathrop.

The firm back in 1988 was in the midst of shepherding an 11,000 home planned community in Dougherty Valley in the East Bay through to development.

The first time Cambay Group rolled out plans for Stewart Tract they were greeted with skepticism. The project was dubbed Gold Rush City at the time and included plans for a major amusement park.

When Cambay Group didn’t go away and started sinking serious money into the development of Stewart Tract such as securing water, the skepticism started to die down and the environmental fight heated up.

By proposing 11,000 homes and doing so in the outer Delta, Cambay Group put a large target on their proverbial back.

They were sued numerous times including by environmental groups that argued unsuccessfully in court that River Islands should be stopped because it would hasten global warming.

For a 160-year-old company with its roots in shipping, Somerston Group simply persevered much as they did during World War II when Nazi attacks on Atlantic convoys severely reduced their fleet.

Years of litigation over River Islands didn’t result in bitter relations with environmentalists. Instead, Cambay Group fashioned productive working relationships with such eco-groups as the Sierra Club, DeltaKeepers, and the National Resources Defense Council.

Getting past the environmental gauntlet proved to be the easy part.

Cambay Group was running into a brick wall in Sacramento with its efforts to improve the Stewart Tract levees so development could occur. State agencies in charge of permits for levee work had a distinct antigrowth stance. Without their approval, the project couldn’t secure required federal permits.

A bit of engineering ingenuity broke the donnybrook. Cambay Group created a parallel levee and then filled in the gap between creating a 300-foot super levee. In doing so, they didn’t “touch” the existing 30-foot wide levee that would have required a state permit to do so.

The Federal Emergency Management Agency certified the levees. State approval after that was just a formality.

The initial segment of super levees carried a price tag of around $70 million.

The decision to go ahead and build a bridge across the San Joaquin River years before it was needed was also a concession to the bureaucratic approval process.

It had taken Cambay Group years to get permits from 10 different agencies to allow it to build the Bradshaw Crossing Bridge. Once they got the permits, the economy tanked. Facing the prospect of the permits expiring, River Islands went ahead and invested $17 million to build the bridge that wouldn’t be needed for years.

The end result appears as a canopy of sorts across the river with both ends more than 10 feet above the ground. That was done so the bridge in the mean time couldn’t be accessed or vandalized. Dirt will be put in place when the approach roads are built.

River Islands was ready to move to developing home sites in mid-2007 but opted not to do so.

The economic downturn triggered by the housing bubble bursting was driving the price of new homes downward.

Instead of entering a market already glutted by improved lots ready to build and thousands of foreclosed homes, River Islands simply waited.

That meant they sat on close to $200 million improvements for another seven years unable to get even a cent back on their investment.

Cambay Group’s deep pockets enabled River Islands to go into a holding pattern.

It also meant that River Islands wouldn’t be diluting the value of their investment.

The first model homes are now being built with sales expected to start in May.


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