News

Rally held to protest sale of Berkeley’s main Post Office

Protesters held a rally outside downtown Berkeley’s main post office Wednesday to make clear their opposition to its sale. Photo: Kaia Diringer

Several dozen people gathered outside the downtown Berkeley post office Wednesday to protest both the potential sale of the building by the United States Postal Service, as well as what they see as the organization’s reluctance to hear the community’s views on the issue.

The group held placards with slogans including “Save the People’s Post Office” and “Save Post Office Union Jobs and Services.” They entered the post office building and held a rally on the plaza around the corner on Shattuck Avenue.

Campaigners protest the scheduling of a hearing in Thanksgiving week. Gray Brechin, who has been a leader in the fight,is the man with the hat.  Photo: Kaia Diringer

The “Save the Post Office” group has made it clear in recent email notices that it was unhappy with the USPS’s decision to hold a hearing on the sale on Nov. 20, two days before Thanksgiving. Mayor Tom Bates announced at Tuesday’s City Council meeting that the meeting, due to be held at Berkeley High, would be postponed to a date to be decided in January.

In its emails this week, the protesters had noted: “At a packed hearing in mid-September, the public was assured that the Postal Service would work with the City of Berkeley to set a date that would allow full community participation. Instead, Postal Service staff set the final public hearing on a date when many citizens will be away, the Tuesday night before Thanksgiving.”

The post office building is loosely modeled on Filippo Brunelleschi’s Ospedale degli Innocenti in Florence. Photo: Kaia Diringer

The cash-strapped USPS announced in June that the main Berkeley post office, a distinguished 1914 Renaissance Revival building, was for sale. The plan is to move all its carrier and bulk mail operations to the Berkeley Destination Delivery Unit at 1150 8th Street, and to find an alternate retail location for downtown customers.

The City Council passed a declaration in July asking that USPS not sell the Main Post Office. Shortly afterwards, Eddie Orton, an award-winning developer who specializes in historic properties, told Berkeleyside that he would be interested in buying the building on Allston Way.

The USPS has put 40 historical post offices up for sale in the last few years. in numerous communities around the country. The sell-off of such a large number of historic properties so alarmed the National Trust for Historic Preservation that in June it put historic post offices on its “2012 List of America’s 11 Most Endangered Places.” Despite the efforts of numerous activists in communities around the country, the USPS has never backed off closing a historic post office after its closure was announced.

Related:
Developer eyes Berkeley’s historic post office [08.01.12]
Chances are slim of stopping sale of Berkeley’s post office [07.23.12]
Postal Service plans sale of Berkeley’s main post office [06.25.12]

Would you like a digest of the day’s Berkeley news in your inbox at the end of your working day? Click here to subscribe to Berkeleyside’s free Daily Briefing.

Print Friendly
Tagged ,
  • Akkizza

    It would be great if you could interview Gray Brechin. I attended a slide show presentation that he gave on the WPA a few years ago that was incredible. Although I have mixed feelings on this particular issue, I think it’s important that we recognize all of the amazing art, buildings, and infrastructure that came out of FDR’s New Deal. It’s everywhere, yet the public is completely unaware of the magnitude of how many of our civic jewels were built by the CCC and the WPA.

    Whatever its fate, I hope that the foyer remains accessible to the public, so we can still access and view the WPA art at the main branch library.

  • Biker 94703

    Pure foolishness.  Look at lease prices in downtown Berkeley and the likely sale price of the building and it pencils out for 50 years at best.

    * estimated sale price: $3m
    * 1.2k sqft lease in downtown (for new post office):  $5.6k/month ($67.2k/year)
    * $3m / $67.2k = ~45 years

    So assuming that rents in downtown Berkeley don’t increase, the post office trades a building it owns free-and-clear for 45 years of lease payments.  If the USPS had any sense, they’d consolidate the bulk operations on 8th Street, lease out the superfluous downtown sq footage ($5k / month), keep the front office where it is, and profit.

    * Lease profit: $5k – $2k (expenses) = $3k * 12 * 45years = $1.62m

    If I owned a building in downtown, and I had the choice of having $1.6m
    (plus the building) or nothing at all in 2057, I know what I’d choose.

    What would you choose?

  • Mbfarrel

    While I think the Main Post Office is lovely, I think saving the Postal Service is much more important. They are being killed by Congress with extreme requirements for funding their pension fund. I use First Class Parcel Post quite a bit, and their service is much better and less expensive than FedEx or UPS.

    Semi-off topic but the protesters seem remarkably alike in age and race.
    And Gray Brechin looks like a kindlier and perhaps gentler Dick Cheney.

  • EricPanzer

    “Stop the destruction of the public sector?” “Save the people’s Post Office?” “First we kill all the carrier pigeons?” (Look at the photo, these are actual slogans.)

    Every time I think I’m becoming jaded about Berkeley’s penchant for shrill and misplaced activism, something new comes along to disabuse me of that notion. If I’m interpreting that last slogan correctly (a reference to the famous statement by Martin Niemöller), we are meant to believe that the sale of the Post Office building is one step down a road towards fascism and genocide. This is lunacy bordering on the outright offensive.

    Where have these protestors been as UC Berkeley raised tuition beyond the reach of most lower- and middle-income students? Where were these protestors when AC Transit was forced to dramatically cut service? Why aren’t these folks showing the same passion to prevent climate change? It may seem unfair, but I’m forced to conclude that these folks care more about keeping pieces of dead tree flowing through one particular building than they do about the future of their children and grandchildren, the well-being of the planet, or working people’s basic ability to get around.

    This is a golden opportunity to make the central post office into a vastly improved public space, but instead of embracing creative solutions, the City seems inclined to histrionically cling to the past. I have great respect for most of Berkeley’s sitting council members, but I wish they would tune out this misbegotten outrage and engage in a more pragmatic and, dare I say, more progressive approach to the future of this building.

  • The Sharkey

    Lease it out to who? To use for what?
    It’s not as simple as you make it sound.

  • Howie Mencken

    Here you see the unintended consequences of anti-smoking campaigns, laws banning liquor ads on tv and cholesterol paranoia. 

    Berkeley’s 60’s act refuses to leave the stage, while generations of talent wait in the wings for their turn at the mic.

  • The Sharkey

    Every time this subject comes up, the first thing I think about is the McMenamins Kennedy School in Portland, and how wonderful it would be if the downtown Berkeley Post Office was turned into something similar:

    http://www.mcmenamins.com/427-kennedy-school-home

    Turn the sorting room into a brew pub, turn the offices into hotel rooms, turn the parking lot into a patio.
    Instead of being a place that residents dread having to go to, it could be a place that people come to visit from all around the Bay.

  • Howie Mencken

    Thank you.

  • Akkizza

    That’s a great idea! I once stayed in the McMenamin’s Edgefield compound outside of Portland that had originally been a poor farm. 

    As an aside, I would love Berkeley to have more lodging options. 

  • another BUSD parent

    Hippy amber.
    Let it go, old guys.

  • Charles_Siegel

     You have to calculate the Present Value of those future payments.

  • Biker 94703

    You’re right.  It will be impossible to lease thousands of contiguous square feet of industrial space in downtown Berkeley.  If only we had the need for a small-business incubator within walking distance of Bart and the University, or a biotechnology lab, or a commercial kitchen, or warehouse space.
     
    If only there were a local company who specialized in sales and leasing of office, retail and industrial properties in and around
    Downtown Berkeley with over 20 years of experience in the Berkeley commercial real estate market.

    Sigh.

    I guess this is why Measure T failed, we all know there is no need for industrial space in Berkeley.

  • The Sharkey

    So if it’s so obvious, why not give me some specific ideas about the kind of companies you think would want to rent the back end of a building that they wouldn’t be allowed to make a lot of changes to and would have to share with the Post Office?

    It sure looks like there are a lot of empty storefronts and offices within walking distance of BART and the University, so why would someone want to deal with the Post Office instead of leasing one of those spaces?

  • The Sharkey

    Berkeley, the most nostalgic place on Earth.™

  • Alan Tobey

    In other news today : the postal service announced a $15 billion fiscal year loss and announced it has reached the limits of its borrowing authority.

  • Completely_Serious

     Hey Sharkey!  That’s my line.  (Actually it’s Mrs. Completey-Serious’ line.) 

    But, I’m thinking of switching to the catchy diddy from Horse Feathers, “Whatever it is, I’m against it.”

  • http://twitter.com/tereneta Tim Ereneta

    “Your ideas are intriguing to me and I wish to subscribe to your newsletter.”

  • Guest

    Yeah a brew-pub right across the street from the highschool what a well thought out plan!

  • Charles_Siegel

    Eric’s comment send me to google, and I quickly found an article by Gray Brechin that says (in part):

    Three days after superstorm Sandy devastated New York CIty and New
    Jersey, an exceptionally high tide flooded nearly 60% of Venice but few
    outside its region noticed.   …

    We have all endured the seemingly eternal season of folly that is a
    U.S. presidential campaign in which body language, facial tics, and
    quips have substituted for substantive issues. Although increasingly
    alarmed scientists have tried to alert the U.S. and other governments to
    what greenhouse gases are doing to weather patterns and to the oceans,
    little has actually been done but to press harder on the accelerator.
    The subject remained off limits during the presidential debates.

    Despite decades of warnings about what might happen if a tidal surge
    inundated the New York subways, D.C.’s Metro, San Francisco’s BART, or
    the London Underground, the parties have gone on as if there were always
    more fun at the end of a short jet hop from the Venice airport. But the
    global forecast is now for submerged runways as well as subways, for
    more freakish and frequent superstorms, and for darkened skylines as the
    price of our energy-addicted dithering. We are all Venice now.
    http://markcrispinmiller.com/2012/11/were-all-venice-now/

    So, it seems that he does have some passion to prevent climate change – and also that he is a good writer.

    Incidentally, I agree that the protests about the post office are nostalgic and futile. It doesn’t follow that all the protesters do not care about the future of their grandchildren or the well-being of the planet.

  • Black Lotus

    We were on campus protesting outside Sproul Hall where were you? oh that’s right you were sitting in front of your computer attacking people who put themselves out there and stand up ( publically ) for what they believe in.

  • PragmaticProgressive

    Well that post office is right across the street from the socials security Office….

  • The Sharkey

    What’s wrong with it? Most brew pubs don’t sell beer in to-go containers, so it’s not like patrons could easily sneak booze out to kids, and there’s another brew pub (Jupiter) less than a block away.

    Might run afoul of zoning I guess, but you have to admit that a brew pub B&B would be able to make good use of that space in a way that few other businesses could.

  • Biker 94703

    Indeed.  To be complete, its ~$900k in PV rather than $1.6m.
    Also, assuming 3% annual inflation, our $3m runs out after 30 years, not 45, so the PV is only $700k on the 30 year period.

    So that makes our options:

    1) In 2042, own a building in downtown and earn $700k in 2012 PV.
    2) In 2042, own nothing because you spent the $3m back in 2012.

    Does that change your mind about selling?

  • Biker 94703

    Why?  One word: Price.

    900 sqft of retail at 1801 Shattuck Ave will run you $3k/month.  (Any wonder why these spots are empty?)
    17k sqft of warehouse at 1440 San Pablo Ave will run you $30k/month.

    The USPS, having no mortgage and paying no taxes, has an immense amount of flexibility to undercut the going rates.

    Location and price: why its almost as ridiculous as putting a grocery store in an old bowling alley!

  • Charles_Siegel

    The way to compare is:
    1) Present Value of the sale is $3m
    2) Present Value of your lease scheme is the lease payments with future payments discounted to their Present Value + the 2012 PV of owning the building from 2042 onward.

    The discounted PV of having an asset 30 years in the future is low, so I expect that you get a higher PV in total from the sale.  

    Determining the PV or FV involves some work, because you have to discount all those lease payments based on how many years in the future each lease payment comes.

    What discount rate did you use to determine PV?

    This statement doesn’t make sense:
    “Also, assuming 3% annual inflation, our $3m runs out after 30 years”

    If I put the $3m under my mattress, I will still have $3m after 30 years.  It will have less purchasing power because of inflation, but it won’t run out.

    If I put the $3m in investment grade corporate bonds, my earnings should exceed inflation.

  • FWCC Clients

    1

  • Howie Mencken

    …wait, we just defeated the stand up ordinance…

  • The Sharkey

    But will the price be worth the headache of dealing with the Postal Service as a landlord? The sorting room in the main Post Office is a weird space, and despite your suggestions that a Federal agency could/would be flexible on anything (Ha!) I still think it won’t be easy to find someone who wants to lease it under the kind of terms that the USPS would offer.

  • Biker 94703

    Because the USPS can own the building in perpetuity, calculating PV is easy:

    PV = FV / i
    So assuming $5k/month rent at 3% federal long-term rate:
    => 5000*12 / 3% => $2m

    So considering ONLY the back of the building which I am suggesting could rent at the ridiculously low price of $5k/month, you’d have to offer me more than $2m.

    You’re neglecting the fact that the USPS, after selling its building, needs to rent a new one in order to have a post office downtown.  That would consume $3m in 30 years time at the going rate of $5.6k/month for a 1.2k retail space (at 3% inflation).

    What Would Denny Abrams Do?

    Not sell.

  • Biker 94703

    I bet I’ve had worse landlords in this town.

  • http://twitter.com/captfuzzbucket CaptFuzz

    If it weren’t for Netflix, this would have happened 5 years ago.  Anyone been to the Rincon center in SF?  It was a post office too.  Now it’s a lovely food court.

  • Anonymous

     And air conditioning…It’s refrigeration essentially.

  • Charles_Siegel

    You also have to consider the PV of their lease payments, rather than calculating how long it would take them to use up the $3m.  But this is basically a good calculation, and it sounds like the PV of renting out the space ($2m) is roughly equal to the PV of selling ($3m) minus the PV of leasing a much smaller space in some existing downtown storefront.

    The problem is that the Post Office needs cash.  It is like someone who borrows $1m to buy a house.  If you look at the PV of the mortgage payments on the $1m, it would be cheaper to pay the $1m in cash rather than borrowing it (which is why the bank makes money on the deal).  The problem is that the buyer doesn’t have the cash. 

    I suggested something in comments on earlier articles that would have the same effect as your proposal but would also meet the PO’s need for cash: 

    They should try selling the building to someone who someone who would develop most of it but would lease back the lobby and a small space behind the lobby to the PO, so they could continue to provide their PO services in the same space. 

    They would get about the same sales price, and leasing back this space would cost about as much as leasing some space elsewhere in downtown – so it would be about the same for the PO economically as their current plan but it would also allow them to keep their existing space.

  • Guest

    It’s interesting how CB Richard Ellis is in the business of dismantling California, and now the USPS
    Governor Brown stopped them from selling eleven state buildings, and here’s how:

    http://blogs.sacbee.com/capitolalertlatest/COMPLAINT-FINAL.pdf

    Best of luck in struggle against the man

  • Charles_Siegel

     Right after posting this, I saw an article on the front page of Yahoo news saying that the PO lost %15.9 Billion this year.  That is why the have to sell real estate to raise cash.

  • Berkeleyborn

    The post office will not be able to recover from its structural debt obligations by selling their core assets. These obligations will just wipe out any revenue gained from the property sales, then leave the post office poorer, in more debt, and without any other assets to sell, with the next step being some sort of bankruptcy. There is no doubt that the PO needs to revolutionize, and that we don’t need Saturday mail, and that most of what it makes money delivering is junk mail we all recycle, and that the pension and health care system is going to implode unless bailed out, but this is the case with many cities, counties, and states. Unless those issues are addressed, the property sales are meaningless from a revenue standpoint, as they amount to a drop in the bucket of the actual debt.

  • Howie Mencken

    They’re just not living hard enough! America will soon be the first country ever to have two whole generations in diapers at the same time.

  • Lee Gogreen

    News flash to the people protesting the post office building yesterday. The USPS just announced that they reported a loss of $15 billion this year. Please let them sell it to a developer who will add more housing which will grow our city revenue through the increased revenue that our downtown businesses need.

  • The Sharkey

    I can’t argue with that!  :-)

  • The Sharkey

    Here’s a link to a news story verifying what Lee Gogreen said:

    The Postal Service posted a record net loss of $15.9 billion in fiscal 2012, much of it due to massive payments the mail agency could not make but still must account for in financial statements.

    That is more than triple its $5.1 billion loss last year.

    The USPS, which relies on the sale of stamps and other products rather than taxpayer dollars, has been grappling for years with high costs and tumbling mail volumes as consumers communicate more online.

    http://www.msnbc.msn.com/id/49840187/ns/business-retail/t/postal-service-reports-billion-annual-loss/

  • Tzedek

    Has anyone mentioned that USPS will be required to bring this beautiful-but-antiquated building up to code if USPS wants to continue to use this building ?

    That substantial expense is way beyond resources USPS has available.

  • guest

     No, the quote referenced on the sign is Shakespeare: “The first thing we do, let’s kill all the lawyers.” Henry VI, Part 2 Act 4, scene 2.  And the rest of your post is equally ignorant.

  • Biker 94702

    All buildings need maintenance.  Where is the source of this claim?  What is the “substantial expense”?  Also my understanding is that as a Federal building, it is exempt from CA State Building Codes.  Do you understand differently?

  • Charles_Siegel

     Are you planning to help solve the problem by not becoming old yourself?

  • The Sharkey

    If Eric’s post is ignorant, your reply is downright moronic.

  • Howie Mencken

    Chas…I’m living as hard as I can!

  • Howie Mencken

    I think the first thing they should do is put some teeth in…their argument. At least for the photo ops.

  • Charles_Siegel

    The rather obvious solution that I have been suggesting from the beginning seems to have a chance. 

    “Verbally, Diana Alvarado stated that if the USPS decides to sell our
    Allston Way post office, the USPS intends to give a preference to
    bidders who agree to lease back the lobby and sufficient space for USPS
    retail services.”
    http://berkeleydailyplanet.com/issue/2012-11-16/article/40524?headline=A-Victory-USPS-will-reschedule-the-November-20th-Meeting.

  • Mbfarrel

    Save the U.C. Theater!

  • Karen Stingle

    The Post Office isn’t “losing money.”  Due to a bill passed in a lame duck congress, backed by ALEC, a right-wing, millionaire funded organization, the PO is required to fund retirement for its employees 75 years in advance!  It is actually running in the black except for that.  See http://www.vltp.net/alec/aleckoch-cabal-pursuing-privatization-postal-service-ups-fedex for more history.