Can This Millionaire Wine Mogul Turn a San Francisco Island Into a Hipster Napa Alternative?
After selling his wine label for hundreds of millions, David Phinney wants to turn Mare Island into a booze-soaked SF getaway. Can he pull it off, or is it more Bay Area hubris?
The Mare Island Causeway crosses an unattractive bridge off the road from San Francisco north to Napa, stretching across the narrow Napa River, before emptying out into the quieter side of the booming Bay Area. And that’s about all there is for a welcome mat.
What comes next is a military-built street lined with a collection of buildings that could be considered either ramshackle or charmingly historic, depending on how much of a buff you are. “Reminds me of Chernobyl!” wrote one Yelp reviewer. “A photographer’s dream,” offered another. And: “there’s decent hiking and lots of cool abandoned-structure lurking… a cemetery, empty ammo dumps and fallout shelters and some nice views of the bay.”
Dave Phinney is hoping to improve that image, without damping the Chernobyl charm. He discovered (in the loosest sense of the word) Mare Island on a tip during a hunt for interesting real estate several years ago, and found himself transfixed by the determination with which this 3.5-mile-long peninsula clings to its history. He also imagined a massive business opportunity.
Phinney’s career began 22 years ago, with a temporary job working a harvest at Mondavi, a post he landed with no pedigree and no prior experience in the field. In 2016, he sold his first company, which includes the hit brand Prisoner, to Constellation Brands for $285 million. In 2017, he sold the label Orin Swift Cellars to E. & J. Gallo for an undisclosed sum.
If you didn’t know all that about Phinney’s fast ascent up the viticultural vines, you might find his fixation on the tiny isle across the water from the San Francisco wharf grandiose. He’d like to transform a long-neglected place that once housed the largest naval base west of the Mississippi from a collection of rundown old Navy buildings into a walkable model city, where even driverless cars are unnecessary. The engine for this change, of course: booze.
In August, Phinney opened the Savage & Cooke distillery and tasting room on Vallejo’s Mare Island. The endeavor is Phinney’s first foray into spirits, with a strikingly designed opening line of bourbon, American whiskey, and tequila. As of this moment, the distillery occupies two century-old buildings in a row of mostly abandoned neighbors that have changed only by aging since the Navy walked away from Mare Island 23 years ago. When Phinney is finished, Savage & Cooke will anchor a development that could include a fried chicken restaurant, a public park, a rooftop bar, a boutique coffee roaster and maybe even a baseball stadium. Phinney and his collaborators want to call it “The Wet Mile,” a 40-minute ferry ride from downtown San Francisco and a hipster-friendly alternative to bourgeois Napa.
“It’s an island in the San Francisco Bay,” says Vallejo deputy city manager Will Morat. “I don’t know of any other place that can claim to be an island in the San Francisco Bay that’s prime for development and investment. This could be the next economic center in the Bay Area.”
Phinney isn’t alone; he’s working with billionaire Memphis investor Gaylon Lawrence, Jr., and local real estate broker and winemaker Sabastian Lane, in what they call the Nimitz Group. He’s also not the only entrepreneur with his sights set on the island that birthed the first naval base on the West Coast in 1854, but he is arguably this history-infused landscape’s biggest dreamer. The more the surrounding Bay Area buckles under the weight of unreasonable housing costs and overloaded roadways, the more a short ferry ride across the bay gleams with possibility. You’ve probably never heard of Mare Island. You’ll probably be hearing about it a lot more, soon.
“I want to create a model city,” Phinney told The Daily Beast in an interview at Savage & Cooke last fall. “Driverless cars, completely sustainable. This has all become economically viable in a way it didn’t used to be. It’s a 50-year plan.”
The Mare Island Naval Shipyard was the first navy base built on the West Coast, back in 1854 by the Navy’s first admiral, David Farragut, the Civil War legend whose famous battle cry “Damn the torpedoes, full speed ahead,” has lived long after he died. The island itself was once known as Isla Plana by Spanish explorers, but was later renamed for Gen. Mariano G. Vallejo’s white mare, which fell overboard as Vallejo’s ship crossed the Carquinez Strait, and swam ashore. It was Vallejo who built the first aircraft landing platform for a Navy ship and the western U.S.’s first nuclear submarine, along with more than 500 ships. The 127-year-old golf course on the island is the oldest 18-hole course west of the Mississippi. During World War I, workers built the destroyer the Ward in 17 days, a still-standing record that’s “unreal, when I think about it,” regional historian and former Associated Press reporter Brendan Riley told The Daily Beast. Employment on the island once surpassed 41,000 workers. “There’s quite a bit of history still standing, and most of it can’t be taken down,” Riley says.
After the Navy left the island in 1996, property values tanked and unemployment spiked. But as the Bay Area booms and housing costs balloon, developers are desperate for new real estate frontiers. Only about 1,100 people live on the island now, but it’s a tantalizing prospect for tourism because of the short ferry ride to San Francisco. San Franciscans were evacuated to Mare Island after the Great Quake in 1906. Entrepreneurs like Phinney hope they’ll evacuate the city once again, on a better note.
“The linkage of a brewery, winery and distillery plus all these historic attractions has worked in a lot of other places; that’s what they’re betting on,” Riley says. “If you’re living in the city, you don’t have a car. You really have to fuck up to miss the opportunity here.”
There are already some 3,000 workers either living or commuting to the island daily to work for 110 business on construction projects, steel recycling and lumber shipping. There’s plenty of industry here, including a boat builder, an engineering firm and an osteopathic college. What’s next is community: The island’s largest housing developer is Lennar Mare Island, which is building 1,400 homes on the at least 650 acres the company owns, some of which are among more than 500 buildings and other structures designated historic landmarks.
“You go from the set of the Walking Dead to all this cool historical stuff,” says Kent Fortner, who beat Phinney to the punch when he opened Mare Island Brewing here in 2014. Fortner and his wife, like Phinney, came from Napa. They came to the island “on a lark” in 2007 and found a historic officer’s quarters for sale. “It was stripped of all its stuff, but just glorious.”
Fortner remodeled the house, then opened his brewery with partner Ryan Gibbons, another winemaker who transitioned from “grape to grain,” moving from New Zealand and Bordeaux reds to Lagunitas beer. When the two set up shop on Mare Island it was next to a Renaissance festival storage space, neighbors “jousting with turkey legs,” and others “designing cars with giant flames and women.”
While the brewers are proud of what they started, Phinney “operates on a level with a few more zeros than us,” Fortner says. “Same concept: cool old buildings, people take pride in crafting things. Now we’re seeing kombucha, ginger beer, coffee and tortilla manufacturers all kicking the tires on Mare Island.”
Phinney is leaving the housing to Lennar; he wants to build businesses on Mare Island, and he feels liberated by the encouragement he’s getting from Vallejo city officials. The island is now designated as a federal Opportunity Zone, which could spur interest from investors seeking refuge from capital gains taxes. The city of Vallejo has granted exclusive negotiation rights to the 157-acre parcel it owns.
“It’s absolutely at a point where it’s ready to blossom,” Vallejo City Manager Greg Nyhoff told The Daily Beast. “Things are moving very quickly on a lot of fronts. This is going to be a place that will rival Napa.”
There is a mixture of eager and anxious anticipation of these plans amongst other businesses on the island, Riley says. While most expect the Phinney and his partners to follow through, there’s been some griping about a lack of transparency, and some caution about plans this grand. “Are these guys dreaming too big?” Riley says. “Are they really capable of carrying out this in some ways overwhelming project? It’s a note of caution.”
Business owners on the island know their fates will be closely tied to that of the Nimitz plans, for better or worse. Some are nervous about the out-of-town involvement, in Lawrence, and what exactly the final project winds up looking and feeling like. “Some of the businesses in the shipyard are really counting on these owners to get it moving, so they’ll succeed, Riley says. “There’s a general sense that people are on edge.”
Fortner says most of the feeling amongst the island’s current occupants is positive, but there’s also “a bit of trepidation about the unknown,” he says. “There hasn’t been a lot of information about his timelines and transition. But everyone is excited to see what’s next.”
Phinney is rehabilitating seven historic buildings, including the two that house Savage & Cooke, which is named for two men who once worked in the shipyard’s electrical building.
Phinney’s whiskey is now purchased from other distilleries and blended and finished in his barrels, but within two years, he plans to distill on-site, with water from his own vineyard in Alexander Valley and with grains from a 300-acre farm he owns in Yolo County. He plans to supply his own corn for bourbon and a friend’s heirloom sugarcane for rum.
He’s not the only one with big plans for the island. Modular home builder Factory OS plans to build stackable modular housing in a 250,000 square foot building that once housed the shipyard machine shop, and about 1,500 units are already under construction, Factory OS CEO and Founder Rick Holliday recently told the North Bay Business Journal.
“Anyone with an interest in history, as soon as they come down and figure out what’s happening here is hooked,” Fortner says. “It’s magical. Most towns on the West Coast have a building or two that speaks to this kind of history. Nothing else has it.”
“The idea of being able to tinker with an island for the rest of your life,” Phinney adds, “is kind of cool.”