From Air Force Base during WW2 to successful business park, the successful evolution of McClellan
On April 29, 1939, a staggering 50,000 people turned out for the dedication of the Sacramento Air Depot, which went on to become McClellan Air Force Base, a critical asset for the United States during World War II and an economic engine for the Sacramento region. Local historians say it was the first event in the region to draw such a massive crowd.
(This story first appeared in Comstock's magazine in July 2019)
Military dignitaries flew in from Washington, D.C., and B-18 bombers flew overhead. Col. Harold Strauss, Depot Commander, opened the ceremony by saying, “It is difficult to realize that 2 square miles of rolling pasture have been transformed into this marvelous depot.”
Fast forward 80 years, and that pasture has been transformed again. The 230 businesses and organizations at McClellan Park include the U.S. Coast Guard, Cal Fire, U.S. Forest Service, California Department of Transportation, AT&T, Siemens, Sacramento Metropolitan Fire, Mikuni corporate headquarters, Gateway Charter School and Twin Rivers Unified School District administration offices. The business park is 85-90 percent occupied, the airport and its 10,400-foot runway is fully operational, and 18,000 people work there.
“What we hope is ultimately (McClellan Park) is going to be the premiere business park in Northern California,” says Ken Giannotti, senior vice president of leasing and marketing at McClellan Park.
Eighty years ago, McClellan AFB turned the Sacramento region into a major hub for the U.S. Air Force and a critical player during World War II, the Korean War, Vietnam, the Cold War and the Gulf War. As many as 26,000 military and civilian personnel worked at McClellan Air Force Base, where they serviced, overhauled or retrofitted more than 85 types of bombers, fighters, refueling aircraft and cargo transports. The base hosted dignitaries, including President Bill Clinton and Bob Hope. McClellan was a bustling little city with housing, a hospital, fire stations, movie theater, barber shop, pizza parlor, bowling alley, pools and its own Zip code.
The base thrived for decades until the U.S. entered the peace era. McClellan, along with more than 350 other military bases across the country, was slated for closure by the federal government in 1995. When its gates officially closed July 13, 2001, 11,000 military members were working there.
But a determined group of people wouldn’t let the base die. The Sacramento County Board of Supervisors, Sacramento Metro Chamber, a citizens group and local developer Larry Kelley all saw potential in the 3,452-acre site with more than 10 million square feet of buildings. It had a prime location close to Interstate-80 with easy access via Watt Avenue and Roseville Road. Light rail was nearby and so was a railroad line to transport heavy goods to the Port of Sacramento and by barge up to Alameda for shipping overseas. And there was plenty of space for warehouses, storage and parking. They would convert it into a business park, creating a new economic center for Sacramento.
“If you took away the jobs, it was going to hurt,” Kelley says. “(McClellan) had a lot of infrastructure, a lot more buildings and a lot more assets in general than a typical Air Force base would have.”
Kelley was well-suited for the massive task. A military brat whose father, Roy Kelley, was a lieutenant colonel in the Air Force, Kelley was brought in by famed developer Eli Broad in 1989 to develop Stanford Ranch in Rocklin, one of the most successful planned communities in the U.S. Kelley took over the development in 1996. Kelley, CEO and president of McClellan Park and LDK Ventures, is also an investor in the Sacramento Kings and has taken on developing the historic Sacramento Railyards with his son and partner, Denton Kelley, a member of Comstock’s editorial advisory board.
“I just knew it would work,” says Kelley, sitting in his modest office at the business park, surrounded by pictures of his family and mementos from his travels. A framed ceremonial shovel from the ground breaking of the Golden 1 Center sits outside his office. “I knew the location was good. I knew if we got the right transactions structured we could do something that was really special and would employ a lot of people and create a huge tax base and be an economic driver for the region as opposed to a drag. It would be a plus, and that’s what we did.”
Converting the military base was a daunting task. Kelley says each day brought a new problem or challenge. Developers had to replace 26 miles of sewer lines and improve storm drains. Individual electrical meters were needed. There was also a massive contamination cleanup. (The base became a Superfund site in 1987, with the federal government paying for the cleanup.) All but 200 acres of the base have been cleaned with the groundwater extensively monitored. In 2018, McClellan won the U.S. Environmental Protection Agency’s first National Federal Facility Excellence in Site Reuse award and is considered a national model for converting shuttered military bases.
“McClellan as an Air Force base was one of the most complicated (cleanups) in terms of environmental challenges. Now it’s turned into a crown jewel, winning the base reuse award from the EPA,” says Linda Geissinger, spokesperson for the Air Force’s Civil Engineer Center, which monitored the base conversion.
“(McClellan) had a lot of infrastructure, a lot more buildings and a lot more assets in general than a typical Air Force base would have.”LARRY KELLEY, LDK VENTURES
Maintaining the base’s historic Art Deco style architecture was also critically important. The main entrance to McClellan’s business office has arched crown molding and a sculpture of an airplane propeller over the doorway. The base buildings were creatively converted for modern use while keeping parts of their historic architecture.
Troy Givens, Sacramento County’s director of economic development, says McClellan Park has brought in hundreds of millions of dollars to the region.
“We have a thriving business park where we have a lot of activity and a lot of people reinvested and making investments in creating jobs, which is positive all the way around,” he says.
The New McClellan
Driving through the park today, modern architecture is mixed with historic military buildings, palm-tree lined streets and workers taking walks in the sunshine on lunch breaks. The Pentagon holds up McClellan as a shining example of a successful military base conversion.
The only presence of the war planes that fought far-off battles is at the nearby Aerospace Museum of California, which serves as a historic tribute to the base’s glory days.
McClellan’s modern airport plays a critical role in the safety of Northern Californians. The Coast Guard, based at McClellan since 1978, has a 24-hour operation, its fixed-wing aircrafts conducting search-and-rescue missions on the Pacific Coast. Its C-27s can often be seen flying over the Capital City Freeway en route to the base. In 2008, Cal Fire began using McClellan during fire season for reloading DC-10 air tankers with flame retardant, and last year it established permanent year-round operations there.
The park is also home to a nuclear reactor. The Air Force built the research reactor in 1990 to detect corrosion and defects in aircraft parts. When the base shut down, UC Davis bought the reactor for a dollar lease, and workers currently test aircraft and rocket parts for NASA, Elon Musk’s SpaceX, Jeff Bezos’ Blue Origin rockets and others. The reactor takes highly transparent neutron X-rays of the aviation parts to detect flaws, only one of which can fail an entire rocket mission.
“They want to make sure those little (rocket) initiators actually work. They send them here, we image them in place and send them back,” says Wesley Frey, director of the McClellan Nuclear Research Center. Frey also launched the Nautilus program, which has introduced 1,000 schoolchildren from around the region to science, technology, engineering and math research.
Kratos, another tenant, designs high-performance drones that look like small jet fighters and can fly 700 mph. The U.S. military uses them for target practice.
Gateway Community Charter Schools, which has nine charter schools countywide, has its offices at the site of the base’s former daycare center, and two of its schools, with 1,740 students and 254 staff members, are there. Jason Sample, chief communications and strategy officer for Gateway, saw the former base as a perfect fit for education.
“We saw it as a great place to have a connection to history, to a known place to the community,” says Sample. “Here is space. They have fields, they have areas where we can grow.”
Sample says operators of the business park have been great partners, sharing ideas for the school. He says management suggested Gateway take over the former base theater. Gateway’s drama and theater students now use it for theatrical productions that are shared with other Gateway students. McClellan’s former bowling alley is now Gateway’s charter school for at-risk children.
“I think we have found it to be a true partnership. They dream with us,” Sample says.
Looking Toward the Future
McClellan Park always is on the hunt for new tenants.
“We saw it as a great place to have a connection to history, to a known place in the community. … I think we have found it to be a true partnership. They dream with us.”JASON SAMPLE, CHIEF COMMUNICATIONS AND STRATEGY OFFICER, GATEWAY COMMUNITY CHARTER SCHOOLS.
Recognizing that industrial is the new retail, McClellan is focusing on e-commerce, providing warehouses to companies that need significant space, such as PODs container company and Packaging Corporation of America. In May, Walmart opened a transportation office for trucks used in its distribution service. U.S. Foods Holding Corps just broke ground on a 355,000-square-foot distribution center it expects to open in 2020. A 400,000-square-foot warehouse is under construction, and McClellan expects to build more than 3 million square feet of industrial space over the next six years.
“The buildings we’re building now — the 400,000 square feet — is set up for large-scale distributors, and that could be a variety of e-commerce companies,” Giannotti says.
The park has an aggressive recruiting campaign that includes a monthly newsletter sent to 900 commercial real estate agents throughout California and out of state and a five-minute video that blends the history of the base and the business park. The leasing and marketing team also pursues clients through advertising on television, radio and magazines and on social media. They won’t disclose leasing rates but say they are competitive.
McClellan Park also has a Lion’s Gate hotel and a conference center that hosts major events for corporations and nonprofits. Groups can use their own vendors or the park’s Officer’s Club for catering. And the Innovation Center, run by veterans, helps other veterans start their own businesses.
Athletics Unlimited, which produces athletic uniforms, apparel and equipment for high schools and universities, is a newcomer, opening a 50,000 square feet production center in July 2018.
“I fell in love with it,” CEO Jordan Rasmussen says of the location. “We do see ourselves staying here. The ability to expand geographically within the park is really, really appealing.”
As for the future of McClellan Park, Roger Niello, former Sacramento County Supervisor, state Assemblyman and Sac Metro Chamber president who oversaw the base transition, says tenants will come and go with changing trends in the market.
“I look at it as a tremendous success but I still view it as a work in progress,” Niello says. “There’s more room to develop.”
The entrepreneurial Kelley agrees. He’s taken the extra step of bringing in younger people to join his development group to offer fresh ideas and trends.
“The basic fundamentals of business doesn’t change but how you go about getting business changes. We’re not there yet. You’re always striving forward. Once you’re compliant you’re done. We want more tenants, we want more business. We want to continue to grow it.”