By KEVIN McCALLUM
THE PRESS DEMOCRAT
After a decade of failed attempts to build something on the site of the former White House department store downtown, the Santa Rosa City Council is shifting its development strategy for the property.
Instead of teaming up with a private developer to construct a tower combining retail, a public parking garage and residential units, the council thinks separating the projects might give each a greater chance of success.
The idea now is for the city to build a 700-space public parking garage on the 1.3-acre White House site, now a vacant lot between Second and Third streets. The project would cost about $17.5 million and include ground-floor retail spaces, said Cheryl Woodward, the city deputy director of economic development and housing.
That would allow the city to demolish the nearby 204-space parking garage at Third and D Streets, known as Garage 5. The 1960s-era structure needs $1.8 million in upgrades in the next few years, an expense the city would like to avoid.
Removing it would leave a vacant site in the heart of downtown that would be “shovel ready” for a private developer to build whatever the market will bear, such as a small hotel.
The strategy, outlined by the majority of the council Tuesday, reflects a belief that previous efforts to develop the White House site have failed in part because the city put too many burdens on its private development partners.
“The city has been meddling too heavily in the project,” Vice Mayor Jake Ours said. “We just have to get out of the way and let the market tell us what works.”
Councilman Scott Bartley agreed that the city should be more open minded about what types of projects it would accept for the Garage 5 site.
“Let private industry tell us what is marketable or financeable at this point, rather than trying to micro-manage it,” he suggested.
The city has failed three times in the past decade to get something built on the site of the department store that closed in 1985 and was razed in 1991.
City Hall has long dreamed of building a mixed-use tower incorporating retail, parking and housing on the site, hoping it would turn a stagnant commercial district into an active, 24-hour area.
In 2007, the council killed a development deal with Monahan Pacific Corp. of San Rafael to build 183 condominiums atop a 545-space city-owned parking garage after costs soared and demand for housing softened.
In 2009, a plan for MetroPacific Properties of Tiburon to build a 545-space city parking garage next door to its proposed six-story, 151-room boutique hotel fell apart after new council members questioned the need for so many parking spaces.
Woodward said the complexity of integrating the city’s needs with those of a private developer responding to market forces created challenges for the projects. Separating them into two sites should give each a better chance to succeed, she said.
Not all council members agreed.
Councilwoman Susan Gorin said she saw little indication that developers can get the financing they need to build significant projects anytime soon. Financing is lacking for the projects in Railroad Square and even Hugh Futrell’s highly anticipated Museum on the Square project in the former AT&T building is not guaranteed to succeed, she said.
“It is really dicey as to whether he will get his financing,” Gorin said.
She requested additional study of the lending climate before the city wastes energy on a project that’s not ready.
“I just want to make sure that we’re not expending our limited staff resources on something that doesn’t have a viable chance of moving forward,” she said.
Councilman Gary Wysocky said he likes the idea of opening up the Garage 5 site for development because of its great location. But he’s not eager to see the city spend millions on a new parking garage until a need for those spaces is clear.
“The best deal is sometimes the one you don’t make,” he said.
The majority of council members, however, supported moving forward now. The city needs to prepare for the eventual rebound in the economy, as other cities in the state are doing, Councilman John Sawyer said.
“In this economy, people are gearing up for the return,” Sawyer said. “There are investors all over this state who are putting big money into really unique and visionary large projects in different parts of the Bay Area.”
Woodward said there is reason for optimism. MetroPacific Properties is still interested in building a hotel in Santa Rosa, and has demonstrated it can pull it off even in this economic climate, she said. It recently broke ground on a new hotel project in Riverside, she said.
The council also directed staff to analyze what it would cost to get a tenant into the former WestAmerica Bank offices across from City Hall, which the city purchased in 2009 for $4.1 million. The 14,500-square-foot building needs accessibility work and remains vacant.