While positioned as evidence of the Golden State Warriors’ commitment to building a new arena In Mission Bay, and reported as evidence of the team’s confidence in being able to get the development done despite some vocal opposition, the fact that the Warriors have exercised their option to formally acquire the 12-acre site from Salesforce really doesn’t speak to more than the Warriors’ understanding that the value of the land has appreciated since the team negotiated the purchase in early 2014.
That’s not to say the Warriors aren’t committed to making the move, but that based on current conditions in San Francisco, the ownership would have exercised their option regardless.
A large part of the value of the land is of course what can be built on it – its’ “entitlement” – or the number of square feet allowed. The City rules for calculating square feet of the office space is fairly straightforward – everybody follows the same rules. (BOMA) But when you introduce unique land uses like a stadium – that was not part of the original Mission Bay redevelopment plan and that falls outside of many of the rules to calculate the square feet – a large stadium is not fully counted under the rules – the result is sort of a “density bonus” for the developer. Another developer – not building a stadium – would not get those “extra” square feet.
So the site is uniquely valuable to the Warriors – they will probably will be reluctant to sell even if their project survives the inevitable lawsuits,