Flannery Associates caught the attention of both local politicians and several federal government agencies after it spent more than $800 million buying 140 properties in Solano County over the past five years, purportedly to build an entire new city.
But until Friday, where exactly the money was coming from was unclear.
The New York Times first reported that the company’s investors included Laurene Powell Jobs, owner of the Atlantic and widow of Apple co-founder Steve Jobs, and Andreessen Horowitz, a Menlo Park venture capital firm that’s backed companies including Skype and Lyft, among a host of other prominent Silicon Valley figures.
A source with knowledge of the project confirmed the list of investors to the Chronicle. The Chronicle agreed not to name the person, who was not authorized to speak to the media.
The original man behind the idea, the Times reported, is Jan Sramek, whose LinkedIn account says is a former Goldman Sachs trader.
Sramek’s goal was to build a new city between Fairfield and Rio Vista, according to both a poll sent to Solano County residents earlier this week and a 2017 pitch reviewed by the Times.
The land purchases have created one of the biggest real estate portfolios in the Bay Area, now backed by some of the savviest investors in the world. But the unpredictable, politically fraught nature of land-use politics in the region and California mean it could take decades to build, if it’s ever realized. It could meet formidable resistance from anti-growth activists, environmentalists and local politicians and voters. The scope of the challenge of creating a new city from scratch in California is difficult to overestimate.
The 2017 pitch was circulated by venture capitalist Michael Moritz, a former partner at Sequoia Capital with a net worth of $5.2 billion, according to Forbes. Moritz is also the primary financial backer of the San Francisco Standard news website.
Along with Moritz and Powell Jobs, the project has also received funding from LinkedIn co-founder Reid Hoffman, Stripe co-founders Patrick and John Collison, and independent investors Daniel Gross and Nat Friedman, the Times reported. Friedman is also the co-founder of California YIMBY, a pro-housing advocacy group.
Andreessen Horowitz general partners Chris Dixon and Marc Andreessen are also individually backing the company alongside their firm.
Previously, a lawyer for Flannery told the Wall Street Journal that the company was being backed by “a group of families looking to diversify their portfolio from equities into real assets, including agricultural land.” The lawyer said 97% of the capital was coming from U.S. investors, with the rest from British and Irish investors.
Brian Brokaw, a spokesperson for Flannery Associates, said the investors “care deeply about the future of Solano County and California and believe their best days are ahead.”
“We are proud to partner on a project that aims to deliver access to good-paying jobs, affordable housing, clean energy, sustainable infrastructure, open space, and a healthy environment to residents of Solano County,” he said. “We are excited to start working with residents and elected officials, as well as with Travis Air Force Base, on making that happen. That conversation starts next week, and we look forward to sharing more then.”
Democratic Reps. John Garamendi and Mike Thompson, who represent the area where the land has been purchased, have been sounding the alarm on the issue in recent months and years. Both lawmakers have received classified briefings by the Treasury Department and FBI on the land purchases over the past few months, each told the Chronicle.
Garamendi said he first heard about issue four years ago from the commanders at Travis Air Force Base who told him “land immediately adjacent — next to the fence of the base on three sides — was being purchased by an unknown entity.” Thompson said he became aware of the land purchases in early 2023, when constituents shared concerns with him.
Thompson then went to the Defense Department, FBI and Treasury Department because “it was pretty clear that whomever it was that was buying this property was not interested in working with or being open with local elected (officials) and local citizens in Solano County,” he said in an interview.
“It wasn’t until this week that we have begun to receive some indication of what this is all about,” Garamendi said in an interview. Before this week, “there was no information … of where the money was coming from and who was behind it.” Garamendi said a firm representing Sramek requested a meeting with his office.
Both lawmakers received meeting invitations this week from a representative of the group, and those have yet to be scheduled, their spokespeople said. Before that, both lawmakers had been unable to get information about who was behind this group, even with repeated attempts to do so.
“The first we heard back from them was when they called, I think earlier this week, and wanted to schedule a meeting,” Thompson said. He is expecting to meet with representatives from Flannery sometime next week, his spokesperson Jack Stelzner said.
The lawmakers introduced legislation in July to give the federal government authority to oversee real estate purchases by foreign adversaries near military bases, national security sites and critical infrastructure. Garamendi also introduced an amendment to a national defense authorization bill that requires the military to put out guidance on identifying and mitigation “harmful encroachment near military installations.”
The security concerns for Travis Air Force Base endure, even with this new information, Garamendi said. “Travis Air Force Base handles more personnel and material than any other air force base in the United States,” he said. “At this moment, C-17s and C-5s are being loaded with munitions for Ukraine.
“There are numerous ways in which those movements can be disrupted by any organization or person that is adjacent to the air base,” he said. The county has zoning requirements that severely restrict wind and solar farms within miles of the base, so as not to disrupt radar.
Both lawmakers said they are also concerned about protecting family farmers. “They just can’t displace our family farmers; these are people who make a living feeding American households, and that’s totally inappropriate to think that they can come in and just drive them out of business,” Thompson said.
“Flannery Associates used strong-arm mobster tactics to purchase the land, including suing farmers — generational farm families — promising that they can continue to operate, and then throwing them off the land,” Garamendi said.
This group would “build a megacity without any regard whatsoever to the community,” Garamendi said.
Thompson said he is very concerned about their lack of communication with the officials who would approve a project like this up until now. “If, in fact, this was their plan all along, you would think that they would want to meet with the people that will determine the fate of their project.”
Flannery advertised to Solano County residents that it hopes to get the plans for the city on next year’s ballot. If built as promised, it would include tens of thousands of homes and a large solar energy farm.
Duane Kromm, who was on the Solano County Board of Supervisors from 1999 to 2007, said the last few groups that have proposed building new cities on farm land have been “crushed” at the ballot box. In 1984, a developer proposed a new city to be called Manzanita on farmland near Winters (Yolo County). Again in 2000, a developer proposed annexing farmland outside of Fairfield for a new city.
“We have been through this before,” he said. “We are battle-tested at the ballot box.”
Three times voters have reaffirmed the concept that all growth in Solano County should be focused within the borders of existing cities, he added.
“We have a saying here, ‘What is urban shall be municipal,’ ” he said. “Paving over farmland is not a good thing to do.”
He said he was “not surprised” to learn that wealthy Silicon Valley investors are behind the project.
“People with money have their own goals, but the thing that troubles a lot of us around here is the way they came in like a bull in a china shop,” he said. “It’s clear they have no sensitivities to the local community. The damage they are doing to family farms, to people who have known each other for generations, is unbelievable. It’s ripping apart a big chunk of our community.”
Solano County has a fragile series of water distribution agreements in which farmers are compensated for letting their land go fallow during times of drought so that the cities have enough water, he added. Most of the water comes from Lake Berryessa and the Sacramento River.
“I have no idea where they are going to get water,” he said.
But others welcomed the ambitious city-building at the edge of the Bay Area. Matt Regan, senior vice president of public policy for the Bay Area Council, said he is thrilled to see some of the Bay Area’s top business leaders attempting to tackle the region’s housing shortage.
“It’s an exciting turn of events but a little sad to see that these business leaders, and not government entities, taking the lead,” he said. “These business leaders should be focused on running their businesses, not building new cities.”
He said resistance to housing development in the North Bay and South Bay, as well as the inner East Bay, has forced those looking to add density farther away from job centers and public transit. While the project will require voter initiatives and support from local and federal lawmakers, Regan thinks they’ll be able to muster the political support required to get the project approved.
“You are looking at a murderer’s row of very, very clever investors,” he said. “If they are serious about this venture, I wouldn’t bet against it.”
Reach Megan Fan Munce: megan.munce@sfchronicle.com; reach Shira Stein: shira.stein@sfchronicle.com; Twitter: @shiramstein; reach J.K. Dineen: jdineen@sfchronicle.com
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