BY: Lachlan Markay/ Published with permission from Washington Free Beacon.
The top Democrat in the House of Representatives steered more than a billion dollars in subsidies to a light rail project that benefited a company run by a high-dollar Democratic donor and in which her husband is a major investor.
When cloud computing giant Salesforce sold a large plot of land to the Golden State Warriors in April, it had House Minority Leader Nancy Pelosi (D., Calif.) to thank for helping to swell real estate prices in the area.
Pelosi has worked for more than a decade to steer taxpayer funds to a light rail project in San Francisco’s Mission Bay neighborhood, where Salesforce had planned a new campus. Experts say the project boosted the value of Mission Bay real estate.
The company’s CEO, Marc Benioff, is a high-dollar Democratic donor. Pelosi and her leadership PAC are among the recipients of his generous campaign contributions. Pelosi’s husband is also a major Salesforce investor.
Pelosi’s tireless advocacy for federal support for San Francisco’s light rail system has come under scrutiny for potentially enriching another liberal billionaire, hedge fund manager Tom Steyer.
In Salesforce’s case, Pelosi’s work appears to have financially benefited not just a Democratic mega-donor, but also a company in which Pelosi’s direct family owns a large stake as well as valuable real estate holdings in her husband’s portfolio.
Salesforce paid $278 million for 14 acres in Mission Bay in 2010. It bought the land from a group called Alexandria Real Estate Equities, which had purchased it from FOCIL-MB, a division of Democratic financier Tom Steyer’s hedge fund.
The exact dollar figure of its sale to the Warriors was not released. “We paid a very pretty penny,” the team’s co-owner said.
Real estate values in Mission Bay have skyrocketed over the past decade as the city works to transform the former industrial neighborhood.
“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.
San Francisco real estate is some of the most expensive in the nation, and Mission Bay has seen some of the fastest-growing property values in the city in recent years.
Contributing to that rise has been the expansion of the city’s Third Street Light Rail line. Studies on the financial effects of public transit projects, including one that looked specifically at the Third Street expansion, have found that they increase property values in surrounding areas.
Pelosi has been the expansion’s champion at the federal level. Since 2003, she has secured well over a billion dollars for the project in the form of earmarks, federal funding agreements, and stimulus disbursements.
That work has come under scrutiny since it was revealed that Farallon was a major landholder in Mission Bay as Pelosi, a recipient of Steyer campaign contributions and an ally of the billionaire environmentalist, steered taxpayer money to the light rail extension.
A 2004 real estate deal gave Farallon ownership of roughly two million square feet of commercial space in Mission Bay. Salesforce’s planned campus in the area was a bit smaller, but still significant: according to documents submitted to San Francisco Planning Department, its four buildings would have comprised nearly 1.5 million square feet.
An increase in value of Salesforce’s real estate from 2010 to its sale this year would mean a financial gain for the company and its investors, one of whom is Pelosi’s husband.
According to her most recent personal financial disclosures, filed in May of this year, Paul Pelosi owns a stake in Salesforce worth between $500,000 and $1 million.
Pelosi first invested in the company in 2000, when he purchased between $15,000 and $50,000 in stock. According to financial news service Motley Fool, “Pelosi seems to have acquired shares in a private offering” prior to the company’s 2004 initial public offering.
Its stock has soared since then. It debuted at $3.75 a share on June 23, 2004. As of Thursday, it was trading near $53.
Pelosi’s office did not respond to questions about whether that might constitute a conflict of interest.
The Democratic leader’s investments in companies with business before the House came under intense scrutiny in 2011 and 2012 when Congress debated measures governing “insider trading” by members of Congress.
An eventual law imposing stricter regulations on members’ financial activities even included language informally dubbed the “Pelosi provision” due to her and her husband’s participation in IPOs of companies actively lobbying for or against federal legislation.
Much of the information and Pelosi’s and other members’ “insider trading” came to light in Hoover Institution fellow Peter Schweizer’s book Throw Them All Out, which investigated cronyism and self-serving financial deals by members of Congress.
In addition to his reporting on Pelosi’s IPO participation, Schweizer revealed that her husband owns property in San Francisco that will likely benefit from the Third Street light rail extension.
Two stops on the extended light rail line are about three blocks from a four-story office building owned by Paul Pelosi.
According to disclosure forms, the property, at 45 Belden Place, is worth between $1 million and $5 million. He made between $100,000 and $1 million in rent from the property last year.
“The National Association of Realtors says that high-quality mass transit (like [the Third Street light rail]) can increase property values by ‘over 150 percent,’” Schweizer noted. “There’s a sweet spot for obtaining the maximum transit premium: two to four blocks away is ideal.”
That was roughly the distance from Salesforce’s planned campus to a Mission Bay stop on the light rail line as well.
In addition to the potential financial benefits of that “transit premium” for investors such as Pelosi, the light rail extension worked to the advantage of Salesforce itself. The company, which would not say whether it realized a gain on its sale to the Warriors, is helmed by a high-dollar Democratic donor.
CEO Marc Benioff bundled half-a-million dollars for President Barack Obama’s reelection campaign. He has donated an additional $300,000 to Democratic candidates, party organs, and interest groups, according to data compiled by CQ Moneyline.
Benioff is more bipartisan in his contributions than many prominent Obama supporters, but his Democratic donations dwarf the $62,000 he’s given to Republicans.
Among the most recent recipients of Benioff contributions is Pelosi, to whom the Salesforce CEO maxed out with two $2,500 contributions on Jan. 31 of last year. He gave another $5,000 to Pelosi’s leadership PAC and $15,000 to the Democratic Congressional Campaign Committee the same day.
Those contributions came just four months after Pelosi secured $967 million in federal funding for the Third Street light rail project.
DONATE TO BIZPAC REVIEW
Please help us! If you are fed up with letting radical big tech execs, phony fact-checkers, tyrannical liberals and a lying mainstream media have unprecedented power over your news please consider making a donation to BPR to help us fight them. Now is the time. Truth has never been more critical!
- How a small border town is dealing with huge consequences of Biden’s border policies - June 25, 2022
- Biden admin expands ‘critical habitats’ for endangered species to include lands they no longer live in - June 25, 2022
- House GOP demands investigation into Biden staffers who could benefit from student loan forgiveness - June 18, 2022
We have no tolerance for comments containing violence, racism, profanity, vulgarity, doxing, or discourteous behavior. If a comment is spam, instead of replying to it please click the ∨ icon below and to the right of that comment. Thank you for partnering with us to maintain fruitful conversation.