'Very connected with China': Treasury Department continues probing tech investors' plan to build city near military base

The U.S. Treasury Department's Committee on Foreign Investment in the United States is still investigating the purchase of land near a military base in California, the New York Post reported Sunday.

An investment group, Flannery Associates, has spent nearly $1 billion acquiring approximately 52,000 acres of land since 2017 near Travis Air Force Base in Solano County.

The identities of the group's investors were largely unknown, which ignited national security concerns over the land's proximity to the military base. Lawmakers feared the buyers could have ties to China.

Flannery Associates' attorney previously stated that the group is backed by American investors seeking to "diversity their portfolio."

In August, the New York Times revealed the identities of the group's investors, who include Sequoia Capital chair Michael Moritz, Andreessen Horowitz cofounder Marc Andreessen, Emerson Collective founder Laurene Powell Jobs, LinkedIn cofounder Reid Hoffman, Stripe cofounders Patrick and John Collison, and investors Daniel Gross and Nat Friedman.

The moguls reportedly bought up the land to create a walkable city. Moritz stated that the investors wanted to build the new city due to "bad California policies."

"This effort should relieve some of the Silicon Valley pressures we all feel — rising home prices, homelessness, congestion etc," Moritz wrote in a 2017 thesis. "If the plans materialize anywhere close to what is being contemplated, this should be a spectacular investment."

According to a survey distributed to Fairfield residents, the city would have a "college town" feel," SFGate reported.

"This project would include a new city with tens of thousands of new homes, a large solar energy farm, orchards with over a million new trees, and over ten thousand acres of new parks and open space," it stated.

Flannery Associates CEO Jan Sramek denied that the group is attempting to build a "tech utopia." He said investors are "not proposing a pie-in-the-sky 'utopian' fantasy."

Fairfield Mayor Catherine Moy previously stated that no one from the investment group had reached out to discuss the plans.

Moy told the Post that the federal government is "still investigating" the purchase because officials are "not 100% that China is not behind funding on this."

"CFIUS, they're still going forward with their investigation. You can trust but verify, especially with things like this," Moy explained. "A couple of the investors already are very connected with China, business-wise."

California Democratic Rep. John Garamendi stated that the investment firm used "strong-arm mobster techniques" to purchase the land from local farmers. He speculated that the purchase seems like a "patient" foreign investment ruse, the Post reported.

"To say it's 'American money' is not a complete explanation of who is the investor," Garamendi said. "I've been around long enough to understand the way foreign money – legitimate and illegitimate – is invested in the United States. Usually in an LLC, in a real estate transaction."

Travis Air Force base told the outlet that "senior officials are actively supporting all involved federal and Solano County agencies regarding the land purchases."

A spokesperson for Flannery Associates told the outlet that it has "no other foreign investors" beyond the ones it has already disclosed.

The spokesperson stated, "While most area electeds have taken an open-minded approach to the opportunity our project presents for local jobs, investments, homes for middle class families, and clean power, a couple of local politicians are unfortunately and irresponsibly spreading rumors and misinformation to insinuate that California Forever is a not an American company."

"We have complied with all government inquiries and provided documents (including all investment agreements and subscription agreements) that unquestionably prove that over 97% of our invested capital comes from U.S. investors, and that the remaining less than 3% comes from UK and Irish investors (Patrick and John Collison, with smaller stakes held by Charles Songhurst and Thomas Mather)," the spokesperson added.

The Treasury Department did not respond to a request for comment, the Post reported.

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