On the New City in Solano County

Thesis Driven dives deep into emerging themes and real estate operating models. Today’s letter discusses California Forever, the group behind a proposed new city in Solano County, California.

Last week, the New York Times broke the story of Flannery Associates, a secretive group that has spent over $800 million buying over 50,000 acres in Solano County, California. The Times revealed that Flannery is an affiliate of California Forever, a group backed by tech leaders including Marc Andreessen, Michael Moritz, and the Collison brothers, and it plans to build a new city on a scale not attempted in California since Donald Bren built Irvine.

We’ve covered new cities in the past at Thesis Driven. Unlike many in the real estate industry, we are not wholly bearish on the idea. There have been multiple successful attempts at new cities in the United States over the past few decades from New York’s Kiryas Joel to Florida’s Seaside and The Villages. And rising frustration with zoning and land use ossification as well as remote work have combined to make starting a new city slightly less of an uphill battle.

But it’s still devilishly hard. The ambitions of successful entrepreneurs and crypto investors alike looking to build new cities has resulted in a number of announcements but few formal plans filed and—as far as I’m aware—no concrete poured. Instead, the bulk of new city creation in recent years has come from autocratic regimes looking to juice economic growth or move their capital to somewhere less revolution-prone.

Today’s letter will evaluate what we know today about California Forever’s proposed new city in Solano County, including:

• The fundamentals: the location, the land, and California Forever’s team;
• The process they’ll face going forward;
• The good, the bad, and the ugly from what we’ve seen to date;
• How the project might move forward and thoughts about what it means for new cities.

I don’t have any inside intel here, and I’m not going to reveal any facts that aren’t already public. Rather, we’ll focus on putting California Forever in the context of other city-building projects and providing an assessment of where it stands and how it might proceed from here.