SANTA CLARA (CBS SF) — The city of Santa Clara, seeking a new government revenue stream, wants to hear what a major high-rise builder has to say about developing 230 acres next to the planned San Francisco 49ers stadium.
The City Council is poised to bestow Irvine-based Related California with the exclusive rights to negotiate development options for the city-owned land between Tasman Drive and state Highway 237 now used by a golf course and BMX bike track.
Related California made the most of the prospect to one day build retail and housing on the acreage by putting out a statement Monday that “two potential neighbors,” the 49ers and the NFL team’s former quarterback Joe Montana, support their effort.
“Our vision is to create a place that blends the best living, entertainment, shopping and dining experiences from the surrounding are and across the nation,” said Related California president Bill Witte in the statement.
Montana has had a development option on about eight acres next to the 230-acre site since June 2012 and would like to build a hotel and bar about a block east of the 49ers stadium project.
“Our proposed project along with the Related Company’s potential development will be great additions to the North of Bayshore area,” Montana said in the statement.
But Montana has yet to submit a development proposal to city officials, city spokesman Dan Beerman said.
“The city has not got a plan from the Montana group,” Beerman said. “We have heard nothing from him or his group, but he still has exclusive negotiating rights on that.”
Montana’s one-year option on the land, for which the city required no cash deposit, is good until June and can be renewed for six months, according to Ruth Shikada, the city’s economic development officer.
The council at its meeting Tuesday at City Hall is to consider Related California’s bid to put up $200,000 to study building options at the 230-acre site for entertainment, retail, dining and residential uses on it.
The real estate sits across Tasman Drive in Santa Clara from the site of the 49ers’ $1.2 billion stadium project where the team intends to move in 2014 after its final season at Candlestick Park in San Francisco.
The land is in a section of the North Bayshore area designated for entertainment purposes, Beerman said.
“The council’s been looking at what they call an entertainment district for many, many years,” Beerman said. “It kind of fulfills the council’s long-term plan for that area.”
“It’s a big deal,” he said. “There is very little land left in Silicon Valley.”
The city also hopes to reap revenue from leasing the land to the eventual developer several years down the road, Beerman said.
Lease payments would make up for income the city lost from the closing of its Redevelopment Agency from which the city reaped lease money from the RDA’s land holdings.
Santa Clara’s RDA and RDAs in other California cities were ordered dissolved by the state in 2011 and now cities must distribute most of their former RDA funds to other local governments and education districts.
“It’s really necessary from the RDA debacle,” Beerman said. “The RDA dissolution was really a setback for the city. If this goes through, it provides an assured revenue stream for an indefinable time.”
Related California, part of a national high-rise company Related in New York, built the 40-floor Paramount apartment complex in San Francisco and the 42-story The Century condo building in Los Angeles.
The firm’s Grand Avenue project in Los Angeles, served up as a $2 billion mixed-use in 2007 involving famous designer Frank Gehry, has been scaled back and broke ground in January on a $120 million, 19-story apartment building, according to the firm’s website.
Under the exclusive negotiating rights agreement with Santa Clara, Related California would have five months to study the land, much of it former landfill, and report about toxic and hazardous waste conditions, future parking and traffic constraints and other issues.
“You have to remember there is an old landfill at the site,” Beerman said. “They are going to look at all that goes with it.”
Related California would further have to advise the city about the scope of its development plans for the land within 180 days.
The city also has its own list of tasks to complete under the proposed deal, including whether to buy or relocate the golf course and BMX track.
“We don’t know what is going to come of it,” Beerman said of the proposed rights agreement. “It’s kind of a blank slate. This company is taking a look at what might be done.”
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