Plans to bring $5 billion megaproject with housing, restaurants and a convention center to Oakland Coliseum move forward

The city, which owns half of the Coliseum site, agreed to begin negotiations with AASEG in November 2021. The signing of the exclusive negotiation agreement requires the developer to pay the city a $200,000-per-year fee and $2.5 million in one-time funds to cover staff time. Half of the site is owned by the A’s, which have their own plans for the land they own.

AASEG is a Black-owned development team led by an East Oakland native, a former city manager and a developer.

“Awarding the development agreement of this vital site to an Oakland-based African American led business entity will go far in addressing glaring racial disparities within the City of Oakland’s contracting practices,” said Ray Bobbitt, an East Oakland native who is leading AASEG. “This project will foster economic parity, entrepreneurial and local small business opportunities.”

City leaders have said East Oakland, where the Coliseum is located, has long suffered from disinvestment and future projects must boost economic opportunity for residents. The Coliseum, one of the largest development sites in Oakland, could create desperately needed tax revenue. But experts say developing the site could be challenging due to the exorbitant costs of building and massive infrastructure needs. Any project there would take years to win approval and years to finance and build.

Mayor Sheng Thao, Council Members Rebecca Kaplan, Treva Reid, Kevin Jenkins and Noel Gallo are expected to attend a Thursday news conference to formally announce the deal.

Council Member Rebecca Kaplan said in a statement that she’s thrilled AASEG is moving forward and the city has an opportunity to “bring jobs, housing at all income levels, sports, entertainment and more to this vital Oakland site, in a way that strengthens equity and vibrancy for the community at this transit-accessible location.”

Bobbitt has said his team wants to build housing — 35% of which will be affordable — but said their team is still determining how many units total. They also want to create a hotel and a “restaurant row” that features Oakland Black-owned businesses. He also wants to open a Black business district, a Black-owned bank and a museum focused on African American arts, culture and sports, and another to honor Native American and Latino culture.

The group, which is offering the city $115 million to purchase the site, also includes former Oakland City Manager Robert Bobb, Oakland developer Alan Dones, former chair of the Oakland African American Chamber of Commerce Shonda Scott, former NBA player and sports agent Bill Duffy, and Loop Capital, an African American-owned investment firm.

It’s unclear whether the group will ultimately purchase or lease the site — that will be determined in negotiations.

Any plans to redevelop the site requires approval from the A’s, who are a joint owner and have a lease there until 2024 to play their games. In 2019, the A’s bought half of the Coliseum site from Alameda County and said at the time they wanted to build housing, offices, retail and parks there.

In 2021, the state opened an investigation into the county’s sale of the Coliseum to the A’s, and asked for proof that the county followed state law called the Surplus Lands Act. Nur Kausar, a spokeswoman for the state’s housing and community development department, told The Chronicle the county provided “substantial information” and the state decided not to pursue action against the county.

The A’s are currently negotiating with the city to build a new ballpark and surrounding development at Howard Terminal.

Sarah Ravani is a San Francisco Chronicle staff writer. Email: sravani@sfchronicle.com Twitter: @SarRavani