The Third Street Promenade project is just days from breaking
ground in earnest, but the owner of a key site there has yet to
make a move.
The Third Street Promenade project is just days from breaking ground in earnest, but the owner of a key site there has yet to make a move.
Rocke Garcia promises that his 2.5-acre lot on the southwest corner of Depot and Third streets will be the premiere mixed-use project downtown, making Measure A proponents and downtown visionaries squeal with delight.
But don’t hold your breath. Garcia said there are still two things that have to happen before he can proceed: the city has to adopt the updated Downtown Specific Plan, which will outline exactly what they expect of projects like Garcia’s, and the financial outlook has to improve.
So while he’s assembling a team to draw up plans for the project and is working closely with the city, nothing will happen until at least the fall, when the city expects to have the Downtown Specific Plan adopted.
Then, Garcia will approach a bank to request a construction loan. He said he didn’t know how much he’d be asking for, since he doesn’t know exactly what his project will entail.
“We don’t know how many square feet of retail, we don’t know how much underground parking,” he said. “There’s a long procession of details (to get) before you can even come close to knowing how much you’re going to ask for. The bank wants to know exactly what you’re doing and how you’re doing it.”
Without the city’s plan, Garcia has little to offer a financier at this time. But that’s OK: the banks have little if anything to offer him right now anyway, he said.
Garcia already has 53 units allotted for his property. He originally planned to build townhouses there, but the draft Downtown Specific Plan shows the city wants denser housing than that downtown.
Currently, he’s assembling a team to conceive a detailed plan to present to the city and to a lender. The team includes engineers, lawyers and a “very, very well-known architect, a world-wide architect,” Garcia said.
Garcia said the Sunsweet site is right at the top of the list of his projects. He declined to speculate on when he’d be ready to ask for financing for his project, or when construction could begin. One thing is for certain, though: it will be after the council adopts the updated plan.
The city first adopted a Downtown Specific Plan in 2003. Since 2007, city staff have been drafting a plan update that will include mixed-use project possibilities, which are now more attainable thanks to the May passage of Measure A, which adds 500 residential units unfettered by the city’s complicated and competitive housing allotment competition.
David Heindel, assistant to the city manager for downtown development, said the Sunsweet project was a key factor in the success of the Third Street Promenade and the overall downtown revitalization.
“It’s important because it’s the bulk of the frontage on our brand new, spectacular Third Street Promenade,” Heindel said. “(Third Street Promenade) will double the size, hopefully, of our downtown retail shopping district core area.”
Since the economy went south, the city’s strategy is working with property owners like Garcia to do the “preplanning” and the “predevelopment work. So as soon as the economy and the financial crisis abates, we will be ready to go,” he said, adding that it could be worse.
For example, construction on the Sunnyvale Town Center was already underway when the financial industry collapsed, leaving them with a partially built project and future phases unfunded. This led to Congresswoman Zoe Lofgren’s May letter to Wells Fargo and Bank of America executives asking them to detail why the banks refused construction loans to the project’s developer.
And in San Jose, downtown projects were in the preplanning phases when the economy collapsed, leaving them futilely champing at the bit, Heindel said.
Conversely, Morgan Hill is getting all its ducks in a row during the bottoming out, so that the city can take full advantage when the economy turns around, Heindel said.
In the meantime, Third Street Promenade construction will begin this month.
The city council first approved the $4 million project in 2007, after receiving a $1.7 million Metropolitan Transportation Commission grant. The city has to work within deadlines built into the grant, so although land development on the street is stalled, the road renovation is going forward, according to Heindel. Construction will be completed in December. But it’s anybody’s guess whether or not the Sunsweet project will be at all underway by then.
Mayor Steve Tate admitted there were, at first, hopes that the Sunsweet property would be the catalyst to making the entire Third Street Promenade work, but that due to the economy, it didn’t appear to be working out that way. Still, Tate was confident that it will eventually be a successful mixed-use project.
Grading has begun on another key downtown site, the 134-unit Huntington Square townhouse project on the southwest corner of Main Avenue and Butterfield Boulevard. Builders will be working on 14 homes there.
