Lehman/SunCal Trustee and CST Firm Sign $3.7 Million Work Contract

OAKLAND, Calif., March 11 /PRNewswire/ -- SunCal has announced that it has secured a signed agreement between the Lehman/SunCal bankruptcy trustee and the remediation firm CST Environmental Acquisition on a $3.7 million plan to demolish numerous outbuildings throughout the former Oak Knoll Naval Medical Center.  The agreement is being submitted to the presiding judge in U.S. Bankruptcy Court for approval so the work can get underway.

Lehman Brothers is the financial partner for the 167-acre property that SunCal, as development manager, plans to redevelop into a master-planned community

"SunCal is managing all of the cleanup efforts, including coordination of the various contractors already working on the site and the upcoming demolition by CST," said David Soyka on behalf of SunCal. "Only with the support of Lehman ALI and the ongoing leadership of Oakland Councilman Larry Reid could this have become a reality."

SunCal is continuing to work through the court to bring in a new source of funding to resolve the remaining issues at the property and move the development forward.  The plans for the Oak Knoll community include 960 homes with a diversity of housing types, 82,000 square feet of commercial/retail, and 50 acres of parks and open space.

"This is another positive step for the City of Oakland and the future of Oak Knoll," said Oakland City Councilman Larry Reid. "I applaud SunCal for being a consistent and ongoing advocate for the cleanup and development of the former Naval Medical Center property."

"We're pleased that we're able to soon begin demolishing the World War II-era outbuildings, cleaning up debris, securing the hospital building and removing the remaining asbestos," said Chet Chelstowski, vice president of CST Environmental Acquisition.  "We're ready to get started and finish the much-needed cleanup of this site."

In October 2009, SunCal secured an initial $550,000 from Lehman that is being used for property-wide weed abatement, cleaning up wood piles, repairing perimeter fences and providing a team of armed security guards 24 hours per day to help secure the property from trespassers. 

SunCal initiated legal action against Lehman in January 2009 in order to obtain the cleanup funds and resolve other issues involving the property; SunCal itself is not in bankruptcy and continues to do business. 

SOURCE SunCal Companies

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