Nancy Pelosi, Tom Steyer’s Hedge Fund, and a Billion Taxpayer Dollars August 12, 2014
Top House Dem exempted light rail project benefitting mega-donor from cost-effectiveness regulations, then secured federal subsidies.
A top House Democrat to whom billionaire liberal Tom Steyer has donated campaign funds steered more than a billion dollars to an infrastructure project that benefitted his hedge fund. That hedge fund, Farallon Capital Management, bought up large plots of real estate in San Francisco’s burgeoning Mission Bay neighborhood in 2004. The area is now booming and Farallon has sold most of its property there. Steyer, who founded and led Farallon until late 2012, has used his fortune to elect Democratic senators and governors. He has pledged to spend $50 million of his own money in 2014 and to raise another $50 million.
Among the beneficiaries of his political largesse is House Minority Leader Nancy Pelosi (D., Calif.). ""We want to support Nancy as much as we can,"' Steyer said in an interview last year. Pelosi, who did not respond to requests for comment, has also supported Steyer, though with less fanfare.
Over the past decade, she has steered federal subsidies to a light rail project designed to stimulate commercial and residential growth in Mission Bay. Experts say the project swelled real estate values in the area. "From a decrepit and seemingly abandoned old rail yard 15 years ago, Mission Bay has sprouted into San Francisco’s fastest-growing neighborhood," the San Francisco Business Times reported last year.
One of the beneficiaries has been Farallon, which bought two million square feet of Mission Bay commercial real estate space and a handful of residential properties in a $343 million deal in 2004. "This is a world-class asset," said Richard Fried, at the time a managing member at Farallon. "We see it every day. When we had the chance to buy, we jumped at it." Farallon created two entities for the project. FOCIL-MB bought the land and development rights, and Mission Bay Development Group handled the construction and development. Costs associated with the latter were reimbursed by the city of San Francisco under a public-private partnership agreement. The San Francisco Redevelopment Agency reimbursed Farallon using funds raised through bond sales financed by tax hikes in the city.
