Behind California Forever's Silicon Valley-Backed Push To Build A New City For The Future

In the middle of Solano County near the San Francisco Bay are 65,000 acres that could become the birthplace of a new city. 

A group calling itself California Forever — funded by a who's who of Silicon Valley veterans — aspires to transform 17,500 acres of that land into the hometown of 50,000 people by 2040. If all goes to plan, its leaders estimate the project would have more than $16B in annual economic impact on the semirural county — and be an answer for the housing crisis plaguing the Bay Area. 

“We have an incredible advantage of being in a region that has a terrible problem with underproduction of housing,” California Forever Head of Planning Gabriel Metcalf told Bisnow in a recent interview. “Our business thesis is that there is an underserved market for walkable urbanism, and this project will be a test of that thesis.”

California Forever spent nearly $1B purchasing the swaths of land, which surround Travis Air Force Base, from approximately 600 landowners via a shell company called Flannery Associates.

Its acquisition spree was so dramatic and well disguised it prompted the Committee on Foreign Investment in the United States in 2023 to launch a probe into the purchases out of concern that they were made by a foreign entity and posed a risk to national security.

In fact, the buyer was a company founded by Jan Sramek, a Czech entrepreneur who lives in Solano County. It is financially backed predominantly by billionaire internet entrepreneurs, including the founders of Andreessen Horowitz and fintech firm Stripe, as well as venture capitalists and philanthropists like John Doerr and Laurene Powell Jobs.

It also has a variety of large companies on board as consultants, including commercial real estate juggernauts CBRE and JLL.

The land it acquired sits approximately 60 miles from San Francisco and 35 miles from Sacramento. And though it is close to the smaller cities of Fairfield and Rio Vista, it is primarily swaths of grassland. 

Getting caught in the government’s crosshairs, along with its backing and lofty stated ambitions, has sparked controversy and caused California Forever to be grouped in with other so-called “tech utopias.” They include Elon Musk’s mission to build a Texas town to headquarter his businesses, and Praxis, a sovereign “cryptostate” that has secured $525M in financing despite not yet securing a location.

Building a city from scratch is still unconventional. To make it successful, its founders will have to find a way to jump-start an economy from nothing to lure developers and, ultimately, residents.

But the nuts and bolts of the project — a master-planned, greenfield development with a mix of residential and commercial buildings — has plenty of precedent.

“I feel like this stuff gets more press, even though there are lots of more conventional players that try to do it, because it's tech,” said Marc Norman, New York University Schack Institute of Real Estate associate dean. “The tech people want that kind of press because it's almost like a product launch.”

Several other cities have risen rapidly from nothing, Norman said. Irvine, California, was master-planned by the Irvine Co. in the 1960s. It has since attracted the University of California to open a campus and had the 13th-largest population in the state as of 2022, according to census data.

Santa Clarita, California, the 17th-largest city in the state, is the product of a merger of several towns, including Valencia. Several of those communities were created by the Newhall Land and Farming Co., which Lennar Corp. acquired in 2003. 

Still, some have been built only to fail. Arcosanti in Arizona was created in 1970 as a testing ground for Paolo Soleri’s hyperdense urban planning concepts. It continues to exist as a tourism destination but has never been occupied by more than 100 people.  

“When it works, there's a purpose beyond just trying to create a utopia,” Norman said. 

California Forever not only has a purpose, it also a game plan, said Metcalf, a city planner who has spent most of his career in public policy.

Metcalf served as president and CEO of the San Francisco Bay Area Planning and Urban Research Association, then spent four years in Australia as the CEO of the Committee for Sydney, an urban policy think tank.

His layout of California Forever is influenced by early American grid plans, with blocks that resemble the dimensions of New York City at a smaller scale. He has already created a zoning map that establishes mixed-use neighborhoods, a downtown, manufacturing and industry districts, among others.

Those zones are planned to capture an incoming need for advanced manufacturing.

With the rise of artificial intelligence, money is pouring back in to the Bay Area. Through the first nine months of 2024, more than $60B of venture capital was invested in the region, with 66% targeting AI companies — more than a quarter of all U.S. funding — according to a Newmark report.

As of the fourth quarter, the East Bay’s industrial market had a vacancy rate of 7.5%, according to another Newmark report. However, the development pipeline is expected to run dry by early this year. Future high-tech manufacturing plants could be built on California Forever's land close to satellite offices for the firms designing the products.

“I think of this, in a way, as an expansion zone for Silicon Valley companies that actually make physical things,” Metcalf said. “It's obviously too soon for us to know who the tenants are going to be, but we're getting a lot of traction from aerospace, construction tech, ag-tech and then just a big mix of innovative companies, but companies that specifically need some space in which to build.”

Jobs from those companies will bring residents, as well as developers that would add on to California Forever’s foundation.

“We're bringing in other developers, large and small, to do the actual buildings,” Metcalf said. “We may self-develop some things ourselves, but we see ourselves as creating a platform for other developers to come and build.”

Developers are often unused to such a warm welcome, even amid an acute housing shortage. 

Housing construction in the Bay Area has plummeted from 50,000 new units per year before the 1990s to around 20,000 per year in the last two decades, according to a report by the Bay Area Council Economic Institute.

In Solano County, more than half of its renters and over a quarter of its homeowners are cost-burdened, spending more than 30% of their income on housing.

“For a region and a state that has done such a terrifically poor job of producing housing that people can afford at all levels, we shouldn't be denigrating any idea, because we can't afford to do that,” Bay Area Council President and CEO Jim Wunderman said. “We should be filling up our urban areas with infill housing, but there's tremendous resistance to every proposal that comes up.”

California Forever stresses that it intentionally targeted nonprime farmland when building out its footprint. The 17,500 acres contribute less than 2% of the total agricultural revenue of Solano County, according to the group’s analysis of Solano County livestock and crop reports from 2020 to 2022.

Its position in the rolling hills of Solano County also minimizes the threat of wildfires, Metcalf said. Recent fires in Southern California are estimated to have caused an economic loss of between $250B and $275B, according to weather forecasting service AccuWeather. A map by CapRadio, using data from the California Department of Forestry and Fire Protection and federal agencies, shows little historic wildfire activity in the area. 

California Forever’s website says the area already has enough water supply for its first 100,000 residents, citing initial groundwater reviews by industry experts. It further lays out detailed plans to meet future needs without taking from the Solano Irrigation District.

Metcalf also said the site is at an elevation above the projected sea level rise by 2150, making it a possible “climate refuge.” The group touts its intentions of building a city fully powered by clean energy, creating green infrastructure systems and minimizing greenhouse gas emissions. 

California Forever plans to build condos, single-family homes and accessory dwelling units. A starter home, planned at 1K SF with two bedrooms and 1.5 bathrooms, is expected to start at less than $500K. In January, the county’s median home price was $545K, according to Redfin.

Plus, the group plans to launch a $400M down payment assistance fund for prospective homebuyers.

To move forward, California Forever needs to receive zoning approvals. It previously aimed to expedite the process by getting a measure on the November 2024 election ballot. However, it withdrew the measure in July after a report questioned the project’s financial feasibility, instead deciding to proceed with the normal county process, starting with an environmental impact report.

The process also means California Forever will have to address local concerns by designing community benefits and crafting a development agreement. The project is now slated to be on the ballot in November 2026, and if approved, construction will start afterward.

Until then, most of the residents on those 65,000 acres between San Francisco and Sacramento will still be deer. 

“We have driven millions of people out of state and others into homelessness, and we have set up a horrible game of musical chairs where people are fighting each other for the chance to be here,” Metcalf said. “The idea of building a new city as a place for the Bay Area to keep growing is not the whole solution. It's not a panacea. It will not solve every problem — but it would be a really helpful tool in the toolbox.”