Revival of naval shipyard gets California governor’s attention
An official of the governor’s economic development team Tuesday toured the cavernous hangers where workers turn out premanufactured homes in what once was a Naval shipyard.
“We’re very interested in regions of the state that are trying to help create new opportunities for the residents, both in terms of jobs creation and housing production and in terms of good community engagement,” said Chief Economic and Business Advisor and head of the Governor’s Office of Business and Economic Development Lenny Mendonca before touring the Mare Island facilities of Factory_OS in Vallejo.
Abandoned as a naval shipyard in 1996, Mare Island’s large facilities lay dormant for years. But activity has picked up as some businesses returned. The island is designated an opportunity zone, which are government-designated, economically disadvantaged census tracts where financiers can invest capital gains like stock payouts through pools called opportunity funds.
In return, they receive tax breaks that improve the longer they keep their money in an investment. Opportunity funds are required to hold 90% of their assets in qualified opportunity zone property.
Four-year old startup Factory_OS is not receiving funding from the opportunity mechanism but Mendonca said the trip to the island was partly intended to understand how opportunity zones are working in the area and what government can do to help.
“If there’s high quality investment opportunities that the community is excited about, the state is here to help,” he added.
That assistance could come in a variety of ways according to Factory_OS’s CEO Rick Holliday who led the tour.
In terms of opportunity zones, Holliday said the governor’s office could bring potential investors to the island to explain the advantages of investing there.
“I think networking for investment capital is really powerful and a very valuable thing,”
He said having the governor’s office engaged created possibilities for streamlining processes and permitting at the state level when it comes to building.
Holliday also said their affordable housing funding could go further if channeled through his company.
“If they can make the funds available to nonprofits who are buying units from us, the money will go further because in effect it will be less costly and they can get more housing out of the investment,” Holliday added.
Holliday and other business owners on the island are no strangers to partnerships and development.
Earlier this month the Business Journal reported that the four-year old startup received “strategic investments” from San Rafael-based software giant Autodesk and global bank Citi.
An Autodesk spokeswoman previously declined to say how much funding the company received. Factory_OS reported it raised $22.7 million in a federal regulatory filing. The company’s CEO said Factory_OS was building homes 40% faster, 20% less expensively and with 70% less waste than traditional on-site construction of units.