Seeking nearly $2 billion to kick-start the development of Hunters Point and Treasure Island in San Francisco, according to the Wall Street Journal, developer Lennar is in talks with the China Development Bank (CDB) to provide the capital with former deputy mayor of San Francisco, Kofi Bonner, leading Lennar’s charge.
In recent years, Chinese state money—in large part provided by CDB and its counterpart the Export-Import Bank of China—has been pivotal in funding major infrastructure and resource projects around the world, but the bulk of that activity has been in developing countries in Africa, South America and Asia.
That has resulted in the construction of dams, airports, railways, highways and sports arenas that otherwise wouldn’t get built, primarily in developing countries. Funding is typically conditional upon Chinese developers and contractors being used to build the projects. And in order to keep costs down, and in many cases to ensure the necessary expertise, at least a portion of the workforce is flown in from China.
This would be difficult or impossible in San Francisco, where local regulations and deals cut with local governments generally require developers to use local labor and pay prevailing wages.
We’ll call that last paragraph an understatement.