Sutter Health Eyes Huge Santa Clara Lease in Boost for Office Market

Sutter Health has struck a deal to lease a huge amount of office space at a high-profile Santa Clara campus in a deal that bolsters the Bay Area’s wobbly commercial property sector.

The health services titan has agreed to lease three buildings in Mission Technology Park, a four-building office complex in Santa Clara that is owned by Sobrato Investments, a legendary Bay Area real estate firm.

Sutter Health is renting well over 300,000 square feet in the office buildings, according to several commercial property experts familiar with the transaction.

The buildings that Sutter Health has agreed to lease are all located on Mission College Boulevard next to California’s Great America amusement park in Santa Clara.

The three office buildings that Sutter Health is leasing total a combined 324,900 square feet, according to regulatory filings and commercial property databases.

The addresses of the buildings that Sutter Health is leasing are 2431, 2441 and 2451 Mission College Boulevard, real estate sources say.

 

Sutter Health intends to use the three buildings as medical office sites, according to the commercial property experts familiar with the leasing deal.

It wasn’t immediately clear when Sutter Health would be moving into the buildings. Financial terms of the lease weren’t disclosed.

What is certain is that the Sutter Health rental agreement in Santa Clara is one of the Bay Area’s largest office leases so far in 2023. Colliers, a commercial real estate firm, helped to arrange the lease, according to sources.

The 2451 Mission College building totals 136,700 square feet, the 2441 Mission College office is 103,500 square feet in size, and the 2431 Mission College office site is approximately 84,700 square feet.

Sobrato Investments, one of the Bay Area’s most savvy and successful real estate firms, had previously launched a wide-ranging renovation and upgrade of the four-building campus in recent years.

The renovation produced a dramatic modernization that greatly increased the appeal of the office complex.

The upgrade appears to be a big-time success since the four buildings have all landed tenants.

In 2022, Nvidia leased an office building totaling 102,900 square feet at 2421 Mission College Boulevard, according to a Colliers quarterly report.

The Sutter Health rental deal is a reminder of the fast-shifting office market in the Bay Area.

The coronavirus in 2020 prompted state and local government agencies to impose draconian business shutdowns to help curb the spread of the deadly bug.

The lockdowns chased countless office employees away from their workplaces. Even after the restrictions were eased, the return to the office has been uneven because many people are still choosing to work from home or remotely.

At the same time, tech companies slashed their respective appetites for office space, trimmed their property footprints and embarked on layoffs.

As a result, the medical, life sciences and healthcare industries are among the few sectors that continue to seek out office space consistently.

Sutter Health’s leasing agreement fits that trend.

What’s more, the deal by Sutter Health offers a hopeful counterpoint to the rising vacancy rates, loan defaults and empty buildings that now haunt the Bay Area office market.

Sutter Health eyes huge Santa Clara lease in boost for office market

Burbank Housing Picked as Partner For Marin Housing Authority’s Golden Gate Village Rehabilitation

The county has reached a milestone in efforts to revitalize the Golden Gate Village public housing complex in Marin City, but a new problem has emerged.

The Marin Housing Authority approved Burbank Housing on Tuesday as the development partner for the project. The authority will now begin contract negotiations with Burbank, a nonprofit affordable housing developer in Santa Rosa.

“This is really a wonderful place to be at this moment,” said Marin County Supervisor Katie Rice, a member of the housing authority’s board.

However, the redevelopment framework the authority approved last month would cause a large number of Golden Gate Village residents to be classified as “overhoused” — a term for households with more space than needed for the number of residents in them. Residents who are overhoused must move to apartments with fewer bedrooms.

“We know we need to address the right-size housing situation at Golden Gate Village,” said Kimberly Carroll, the director of the housing authority. “However, no one will need to permanently move out of Golden Gate Village as it relates to any of the overhousing situations.”

Concerns about displacement among members of Golden Gate Village’s resident council helped torpedo a previous development plan that called for construction of additional affordable and market-rate housing at the complex. No new housing is planned now.

Under the redevelopment framework, the authority will use Section 18 of the U.S. Housing Act of 1937, which allows for the conversion of public housing to project-based Section 8 voucher assistance. Section 18 also permits housing authorities to partner with private investors to finance debt and access other funds to rehabilitate public housing.

Mike Andrews, a consultant hired by the U.S. Department of Housing and Urban Development to advise the Marin Housing Authority, explained the arrangement at an earlier housing authority meeting.

“Golden Gate Village would be sold to a newly created limited partnership,” Andrews said. “The housing authority would be the managing general partner of that partnership. The investor limited partner would bring equity and expect their tax stream of benefits in return.”

“The housing authority would maintain ownership of the land; they would lease the land to the limited partnership,” he said. “The limited partnership would own the buildings sitting on the housing authority’s land. By doing that, the housing authority is able to attract low-income housing tax equity.”

It is the conversion from public housing to project-based Section 8 vouchers that creates the new overhousing issue.

“The occupancy standards for public housing and the housing choice voucher program are different,” Andrews said on Tuesday.

As a result, many Golden Gate Village residents who live in three- and four-bedroom apartments would be newly classified, through no fault of their own, as being overhoused when the switch to the voucher system occurs. Carroll estimates as many as 70 households could be affected.

“I am working with HUD trying to find a solution,” she said.

This isn’t Golden Village’s only overhousing problem.

In 2021, HUD notified the Marin authority that 72 households at the complex were overhoused. Many of those households involved seniors whose bedroom needs declined as their children grew and moved out.

HUD cautioned that if the overhousing wasn’t addressed it might reduce the Marin Housing Authority’s funding for operations as well as funding for Section 8 housing voucher payments. HUD said it wanted the issue resolved before renovation at Golden Gate Village took place.

Carroll said the number of overhoused households has been as high as 87 but has fallen to between 27 and 30. She said the problem is that there just aren’t enough one- and two-bedroom apartment at Golden Gate Village to move the overhoused residents into.

Carroll said she has received permission from HUD to allow residents who are overhoused to remain in their dwellings until an appropriately-sized apartment becomes available, although she said that could take years.

Residents will have to temporarily move out of their apartments while they are being renovated, but Carroll said when the work is completed, they will be allowed to return to their apartments even if they are considered to be overhoused.

“So the good thing,” Carroll said, “is nobody’s going to be asked to leave permanently.”

Eventually, however, unless Carroll can get HUD to agree to a compromise, residents who are classified as overhoused will have to move to smaller apartments.

Marin Housing Authority picks partner for Golden Gate Village rehabilitation

Sonoma Raceway on Track for Overhaul

Cherishing a bright orange 1965 Mustang GT and a constant love of fast cars, Bay Cities Paving & Grading Vice President of Estimating, Robert Rosas, is gearing up for his dream job.

He’s preparing to reconstruct and repave Sonoma Raceway.

The track, like the 10 other Speedway Motor Sports facilities across the nation, begins to wear out after about two decades. It was last resurfaced in 2001, so “it was time,” according to Steve Swift, senior vice president of operations and development, Speedway Motorsports.

When the Concord excavation company finishes replacing about 10,000 tons of a paving material mix by February, the raceway will host a ceremony to commemorate the smooth-as-skin, $1 million-plus surface.

“I’m super excited to be a part of this. When we announced that we got the job, everybody’s eyes lit up,” Rosas said of his 75 fellow employees. “They all said, ‘Robert’s in heaven.’”

As a boy, the walls of his room were littered with posters of Lamborghinis, Ferraris and Porsches.

“Then, I bought a Porsche 911, during a midlife crisis,” he joked about his continuous passion entering adulthood.

The ads will say: “love is a Subaru.” But to true racing enthusiasts, it’s just about anything that competitively peels rubber around the standard 2.5-mile racecourse.

Rosas and company are creating a special mix of asphalt and a rubberized polymer material, which essentially consists of plastics that will withstand the raceway rigors of heavy traffic and high temperatures.

The mix is expected to be delivered by Jan. 5.

“When we show up, it will be like the Army,” he said.

The Raceway’s final event, Winter Jam, is scheduled for Dec. 16 and 17. Then, the “milling” — which involves grinding up the old track — begins. When the job is done — including the track, pit area and runoff zone — the track will be ready for the renowned Toyota / Save Mart 350 NASCAR race weekend scheduled for June 7-9.

“Our racing surface is in use more than 300 days per year,” said Brian Flynn, Sonoma Raceway’s executive vice president and general manager.

Sonoma Raceway’s 12-turn road course and quarter-mile drag strip located at Sears Point was built in 1968. It completed the upgrade to its hospitality center overlooking Turn 11 in June of 2022.

https://www.sonomanews.com/article/north-bay/sonoma-raceway-on-track-for-overhaul/

The Buck Institute’s Eric Verdin Included Among Over 30 UCSF Scientists Honored for Highest Impact in Their Fields

Thirty-two UC San Francisco scientists are among the most influential individuals in their respective fields, according to the most recent analysis of research citations by the science and intellectual property company, Clarivate.

Researchers were chosen according to authorship of highly-cited journal articles – those that ranked in the top 1% by citations for their field(s) and publication year over the past decade. This citation-based list was then refined by expert judgment at Clarivate to produce a final slate representing the top 0.1% of all scientists.

“We celebrate the Highly Cited Researchers whose contributions transform our world by helping to make it healthier, more sustainable and more secure,” said Bar Veinstein, president of Academia and Government at Clarivate. “Recognition of Highly Cited Researchers not only validates research excellence but also enhances reputation, fosters collaboration and informs resource allocation, acting as a beacon for academic institutions and commercial organizations.”

Highly-cited researchers have made breakthroughs pushing their fields to new heights and inspiring new science around the globe. UCSF scholars are among the most highly cited researchers in biology and biochemistry, clinical medicine, immunology, molecular biology, biochemistry, neuroscience and behavior, and pharmacology and toxicology.

The 2023 rankings include 52 organizations — universities, government agencies and other entities — that are home to 27 or more Highly Cited Researchers. UCSF ranked 11th among all organizations.

The Highly Cited list includes 6,849 individuals from 67 countries/regions. About 84% come from just 10 countries/regions, including 38% from the U.S. and 18% from mainland China.

https://www.ucsf.edu/news/2023/12/426756/over-30-ucsf-scientists-honored-highest-impact-their-fields

Sonoma State University President Mike Lee is at the White House for a California Stakeholder Meeting with Vice President Kamala Harris

In a LinkedIn post, “Our President in the President’s House: SSU President Mike Lee is at the White House today for a California Stakeholder Meeting with Vice President Kamala Harris. He also will attend a holiday reception this evening at the vice president’s residence.”

https://www.linkedin.com/posts/sonoma-state-university_our-president-in-the-presidents-house-ssu-activity-7138963216168009728-dspl/?utm_source=share&utm_medium=member_android

The Buck Institute for Research on Aging Hosting the 1st International Roundtable of Longevity Clinics

In a LinkedIn post, ” The 1st International Roundtable of Longevity Clinics Begins Tomorrow.
It marks a groundbreaking moment in the field of longevity medicine as we kick it off at the Buck Institute for Research on Aging on Demeter 8th.

This event is not just a conference; it’s a convergence of the world’s leading minds in longevity medicine. We’re thrilled to welcome eminent speakers like:
→ Kenneth H. Cooper, MD, MPH – Founder and Chairman of Cooper Aerobics
→ Dean Ornish, M.D. – Founder & CEO of Ornish Lifestyle Medicine
→ Mark Hyman, MD – Founder & Senior Advisor: Cleveland Clinic Center for Functional Medicine, Author of “Young Forever”
→ David A. Sinclair A.O., Ph.D. – Professor of Genetics, Harvard Medical School
→ Dr. Mike Roizen – Chief Wellness Officer emeritus, Cleveland Clinic, Staff Physician Executive Health Professor, Cleveland Clinic Lerner College of Medicine at Case Western Reserve University
→ David Karow, MD, PhD – President and Chief Innovation Officer, Human Longevity, Inc.
→ Eric Verdin, M.D., Ph.D. – CEO, Buck Institute for Research on Aging
→ Joanna Bensz – Founder and CEO, Longevity Center, International Institute of Longevity
→ Prof. Andrea B. Maier, MD – CHI Longevity, Healthy Longevity Medicine Society
→ Prof. Evelyne Yehudit Bischof, MD, PhD, MPH – Longevity Concierge Clinician, Healthy Longevity Medicine Society
and many more.

What to Expect:
– Unparalleled networking with top clinics, suppliers, and experts.
– Rich discussions on global trends, scientific advancements, and practical applications in longevity.
– A collaborative effort to establish gold standards for longevity testing and interventions.

This Roundtable is designed for leaders, practitioners, and innovators in the longevity field. It’s a unique opportunity to shape the future of longevity medicine together.

Stay Connected: Follow the event highlights and join the conversation using #LongevityRoundtable2023.

Here’s to advancing healthspan and shaping a future where longevity goes hand-in-hand with quality of life!
Let’s make this event a milestone in longevity history.”

https://www.linkedin.com/posts/buck-institute-for-research-on-aging_longevityroundtable2023-longevitymedicine-activity-7138968613285232642-WSfc/?utm_source=share&utm_medium=member_android

North Bay Business Journal Celebrates the Release of the 2024 Book of Lists

The North Bay Business Journal is thrilled to celebrate the release of the 2024 Book of Lists, a resource compiled over the year containing key information about local companies, organizations, and business sectors. Kick off the year by connecting with hundreds of top-level North Bay businesses, and developing your professional contacts while celebrating another year of the Book of Lists.

Join us at the North Bay’s premiere networking event of the year to get a hold of your printed copy, which you can reserve today.

SOMO Village Art Gallery

1400 Valley House Drive, Rohnert Park

February 20, 2024

5-7 pm

https://mynorthbaytickets.com/events/book-of-lists-event-2-20-2024

Midstate Construction Corporation and Burbank Housing has Successfully Completed Two Project Homekey Projects

General Contractor Midstate Construction Corporation, has successfully completed two Project Homekey projects with Burbank Housing Development Corporation; Valley Lodge in Napa, CA, and Studios at Montero in Petaluma, CA.

Homekey is a $846 million state-level program that supports the acquisition, renovation, and occupancy of hotels, motels, and other properties to house people experiencing homelessness throughout California. The long-term intention is that the majority of the properties will become permanent housing.

Homekey is an opportunity for state, regional, and local public entities to develop a broad range of housing types, including but not limited to hotels, motels, hostels, single-family homes and multifamily apartments, adult residential facilities, manufactured housing, and to convert commercial properties and other existing buildings to permanent or interim housing for the target population.

General Contractor Midstate Construction Corporation, has successfully completed renovation of the Valley Lodge, Napa; converting an existing 19,375 square foot motel into 54 affordable housing units with a manager’s apartment.

Designed by Tierney/Figueiredo Architects, the scope of work included site and accessibility improvements, conversion of 54 existing motel units with new interior finishes, sprinkler system, efficient plumbing, light fixtures and the installation of kitchenettes. Eleven units were converted to accessibility compliant units designated for potential occupancy by mobility or hearing/vision challenged residents.

Fourteen of these units serve youth, who will receive specialized support services from VOICES in addition to the housing support services offered by Abode Services.

Valley Lodge Apartments is strategically located within walking distance of a bus stop, pharmacy, urgent care, and grocery store. The intake process will draw on the local Coordinated Entry System to identify residents, including youth.

General Contractor Midstate Construction Corporation, has successfully completed renovation of the Studios at Montero, Petaluma; converting an existing 16,873 square foot motel into 60 affordable housing units.

Designed by Basis Architecture & Consulting, the scope of work included site and accessibility improvements, conversion of 60 existing motel units with new interior finishes, sprinkler system, efficient plumbing, light fixtures and the installation of kitchenettes. Three units were converted to accessible compliant units designated for full mobility access, and additional units were provided with features for hearing and visually disabled individuals.

All units intended for residents are the same 207 square feet rooms with no separate bedroom and a single-use bathroom. The City of Petaluma and Burbank Housing are partnered to convert the site into a supportive housing project providing permanent homes for 60 people experiencing homelessness. All 60 of the units are assisted units dedicated to people who meet the definition of “Chronically Homeless.”

The Studios at Montero will provide housing for over 10% of the chronically homeless population in Sonoma County identified through the 2020 PIT count.

The project is located within walking distance of many amenities, including an active bus stop. It will be staffed by a full-time resident manager residing on-site in an existing manager’s unit, night time security will be provided through its first year. Burbank Housing is partnering with the Committee on the Shelterless (COTS) to provide comprehensive supportive services to all project residents. COTS will lead the services team providing services to all residents through a Program Manager, Services Coordinator, three caseworkers, and a Clinical Supervisor. Petaluma Health Center will provide limited health care services on site.

Additional Projects:

Valley Lodge and Montero Studio Apartments are the two most recent Homekey projects in our expanding portfolio.

Other projects for people experiencing homelessness include:

  • Shasta Hotel, a 79 unit hotel conversion in Sacramento, CA
  • The St. Clare at Capitol Park, a 134 unit hotel conversion in Sacramento, CA
  • Mary Isaak Center, an emergency shelter for adults experiencing homelessness in Petaluma, CA

Coming Soon:

  • The Sequoia Hotel, an 89 unit hotel conversion in Sacramento, CA

Santa Rosa Cannery, a 129 unit project with 33 units set-aside for formerly homeless families in Santa Rosa, CA

The Press Democrat Announces Chris Fusco as Executive Editor

Chris Fusco, an award-winning journalist who has led newsrooms in two of the nation’s largest cities, has been named executive editor of The Press Democrat.

Eric Johnston, CEO of Sonoma Media Investments, The Press Democrat’s parent company, said Fusco was chosen from “an incredibly talented field of candidates,” a measure of the company’s reputation in the media world.

“I am confident that Chris’ unique combination of experience and talent – not only strong community journalism but also audience engagement, the technological evolution of our industry and diverse representation in stories and staff – will be a strong addition to our incredibly talented news team,” Johnston said.

It will be a different sort of assignment for Fusco, who spent 20 years at the Chicago Sun-Times (in the nation’s third largest city), including three years as editor-in-chief, and the past 18 months at the Houston Chronicle (in America’s fourth largest city), including three months as interim editor-in-chief.

Between those two upper-echelon, legacy-media stints, Fusco came West to run a digital news startup, Lookout Santa Cruz.

None of those jobs is an obvious comparison to helming The Press Democrat, a mid-sized daily paper in a region that offers its own unique blend of urban, agricultural and wildland environments.

nding Now on The Press Democrat

“To me, there’s really no other executive editor job like this in America,” Fusco said. “When you look at the size and the amount of investment in the room, for the market size, it’s almost unprecedented. Especially in today’s environment.”

Fusco called Sonoma County “a great news ecosystem,” pointing to a vibrant food and wine scene that exists in parallel to a sizable immigrant Latino population that doesn’t always get to share in the bounty.

“The newspaper is there to do what great organizations do, and hold power to account, and lift up the folks who need lifting up,” Fusco said. “To me, the great thing about news organizations is that if we do our jobs well, we get the haves to care about the have nots. And I think the Press Democrat and its sibling publications really embody that — at a time when it’s more important now than ever, given the political climate in America.”

Fusco pointed to another advantage at SMI — the diversity of coverage represented in a constellation of publications that includes the North Bay Business Journal, the Petaluma Argus-Courier, the Sonoma Index-Tribune, the Sonoma County Gazette, La Prensa Sonoma and Sonoma Magazine, the company’s bimonthly regional magazine.

“It gives you a lot of levers to pull, from both a coverage standpoint and a business standpoint,” he said.

Fusco grew up in Alsip, Ill., one block south of Chicago city limits.

“I would say I’m a southside Chicagoan, except some southside Chicagoans would take exception to that,” he observed.

Fusco had thoughts of law school when he enrolled at Illinois-Wesleyan, a small college in Bloomington, Ill., with “a really nice weekly student newspaper.” His future shifted when he took a four-course journalism sequence taught by his faculty adviser. He was hooked.

Fusco interned, then worked, at the Pantograph daily paper in Bloomington, and typed his way to the Northwest Herald in the northwest Chicago exurbs. He then moved to its nextdoor competitor, the Daily Herald in Arlington, Ill., and finally to the Sun-Times.

After climbing a few rungs there, he wound up in a state agency beat and soon found himself immersed in the story of the decade in Illinois — the corruption scandal and public trial of then-Governor Rod Blagojevich, who was eventually removed from office, convicted and jailed for eight years.

“Rod took office with this mantra of ‘it’s not going to be business as usual,’” Fusco said. “And as one of his political foes ended up saying after he got indicted, ‘It sure wasn’t business as usual. It was worse.’”

Covering the Blagojevich drama, at a time when the Sun-Times and Chicago Tribune were duking it out in the daily headlines, cast Fusco into a career-long focus on investigative muckraking.

It hasn’t always been the heyday of journalism. When Fusco joined Sun-Times management as managing editor in 2016, the publication was at a low point. The staff had been slashed dramatically.

“Here I was in a newsroom of 55, with sort of this local ownership group,” Fusco recalled. “Fast-forward four years later, when I left, and somehow we had managed to find some grant funding, add investors who believed in the mission of the paper and squeeze some savings on our printing contract from the Tribune, and we grew that newsroom from 55 to 98.”

Fusco is hoping to work similar miracles in Santa Rosa.

Johnston, the SMI publisher, said he was struck by how easy his conversations were with Fusco, whether they were talking about investigative reporting or mentoring or data analytics. Part of the interview process, both men said, was a panel interview with four prominent members of the community. After the interview, the panel asked each candidate if there was a question that went unasked.

“Chris instead asked the panelists a question – along the lines of, ‘What would Sonoma County be without The Press Democrat?’” Johnston said. “It really resonated with the panel, all of whom unanimously supported his hire.”

Fusco and his wife, the accomplished travel writer Lori Rackl, have visited Napa and Sonoma a few times, and he called the North Bay “the best of all worlds,” with its hiking-trail network, rugged coastline and proximity to San Francisco.

Fusco and Rackl do a lot of cycling, and they are confident the rolling hills of Sonoma County will be a little more inviting than the Houston metroplex. Fusco said they’re already house-shopping.

“My grandfather, who lived to be almost 98, when he was young had an opportunity to go to California and work for the Gallo family,” Fusco said. “And he never took it. So I feel like there’s something in my 100% Sicilian genes that draws me to those vineyards. Not that I want to make wine. But I sure like riding a bicycle through them.”

https://www.northbaybusinessjournal.com/article/news/chris-fusco-named-executive-editor-of-the-press-democrat/

Cornerstone Properties, Catholic Charities of Santa Rosa, and Burbank Housing Are Creating New Housing Key to New Life Downtown

There’s an anecdote developers like to share about Santa Rosa: More housing in downtown Santa Rosa will bring more people to downtown Santa Rosa. And keep them there.

It’s a story Hugh Futrell believes holds true.

Futrell’s company has a number of projects in the works downtown in different sectors such as housing, office and lodging.

He recently entered exclusive negotiations with the Santa Rosa City Council in partnership with Burbank Housing to bring a multipurpose development with housing and additional amenities such as a grocery store.

Another one of his housing projects is in its final construction phase just outside downtown at 888 Fourth St.

“When there’s more people on the street, more retailers, more restaurants that attract people or events that attract the community as a whole, those things over time will alter that perception,” he said, referring to the belief by some that downtown is an “undesirable” place to be.

“There has also been a decline in the amount of downtown employment, particularly since the pandemic, and reversing that is going to be important to maintain a balanced downtown between housing, employment and hospitality.”

Santa Rosa City Council has made housing a priority, easing requirements for developers with plans on bringing high-density housing to the heart of the city.

One of the efforts was the passing of an ordinance that cuts the design review process from 10 months to three months and permit costs from $24,000 to $9,000.

The Express Permitting Program also was created to cut the planning, engineering and building review times from around 18 months to 6 months total.

Housing in downtown Santa Rosa has been a key topic when it comes to revitalizing the historic area.

Both market-rate and affordable housing units exist, but more projects have been announced in the past year. Building more places to live downtown will by extensionbring more people downtown.

Council member Chris Rogers, whose district includes downtown Santa Rosa, said one of the biggest challenges with bringing more urban housing continues to be high costs of building and construction.

“The cost of living is really high here and rents feel very high to us, and to many developers, the return on investment is low so we really do have to be creative to get projects built up here,” he said.

State of downtown housing

Data from the Up Downtown program shows that 198 units of housing have been constructed in downtown Santa Rosa since 2016, with 418 units currently under construction (as of this year) and another 924 units in the building permit process since 2016.

There’s housing in the Rosenberg building, and Catholic Charities recently completed the first phase of its affordable housing project with Burbank Housing known as Caritas Homes.

The second phase is expected to break ground next fall.

On top of more affordable housing developments, efforts to bring more workforce housing also have increased.

Developer Cornerstone Downtown’s director of marketing and development, Pauline Block, said they hear from employers constantly about the need for workforce housing, especially for people with occupations such as teaching or nursing who don’t qualify for affordable housing but often are unable to afford typical rent.

“We really need all levels of housing,” Block said. “It’s going to take a collaboration to really make a difference in downtown, with employers, developers and with the city so I think there’s an opportunity and openness to figure out how to make it happen.”

Cornerstone Downtown has two developments currently in the planning stages. The first property is at 34 Sixth St. near the Railroad Square SMART station and will be a six-story building with 114 units of housing. Eight percent of the units will be reserved for low-income households.

The second property is at 556 Ross Street which is currently a parking lot between the former Press Democrat building and Barrel Proof Comedy. This project will be an eight-story, mixed-use development with 118 units of housing, a public child care center, a small cafe and shared electric fleet of vehicles for building residents to use.

Both are waiting for final confirmations to break ground.

Block said there have been many challenges with bringing more workforce housing to downtown Santa Rosa. She says there aren’t the same subsidies, grants or tax credits available for this type of housing.

She also said other economic factors such as capital expenses, increased risk associated with borrowing funds and high interest rates have created challenges for developers, not just in Santa Rosa but across California.

“Investors and financial institutions are more cautious about the added risks of our market,” Block said. “If you look at places like Oakland or San Francisco pre-COVID, where there was a lot of building happening, you have the same construction costs we have here, sometimes maybe a little more for labor costs. But the rents are much lower here than they are in those areas so that’s where it’s been an issue.”

Another challenge is that many local developers specialize in single-family or low-density housing.

Economic development division deputy director Raissa de la Rosa said the city has been working with developers from outside the county to bring high-density infill housing and other community amenities to downtown.

“In order to survive, we need to have a higher density of housing versus parking,” she said. “We’re still going to have more than enough parking, but it’s one of the incentives that we have to recruit new developers downtown.”

De la Rosa added that once the foot traffic increases, more amenities will follow such as a grocery store or more places that offer child care.

What took so long to bring housing downtown?

Mid- and high-density housing wasn’t the development pattern for Santa Rosa. Rather than building up, development sprawled outward toward the city’s edges, which is why housing is limited in terms of finding space near Courthouse Square and Railroad Square.

After the Tubbs Fire of 2017 took out more than 3,000 Santa Rosa homes, Santa Rosa and Sonoma County formed the Renewal Enterprise District to accelerate the construction of mid- to high-density housing near public transit hubs.

Michelle Whitman, a board member for the Renewal Enterprise District, said the district was able to attract state funding with the goal of bringing more housing to downtown, but interviews with developers and stakeholders revealed that financing issues made the idea nearly impossible.

“They faced financing gaps that they couldn’t address and the reason for that was we were trying to accelerate this type of housing that didn’t really exist in downtown Santa Rosa and the city center more broadly,” Whitman said.

Whitman said sponsors and developers would typically be able to reach between 90% and 95% of funding for a project, but struggled to close the funding gap because of the lack of proof this type of housing was in demand.

The Renewal Enterprise District, using grant money obtained from the state as well as county and state PG&E settlement money from the Tubbs Fire, helped close the gap.

The push for affordable housing

Calum Weeks, policy director with Santa Rosa-based housing advocacy organization Generation Housing said the downtown area needs different types of housing including affordable, market-rate, for-rent and for-sale options.

He said many Sonoma County residents are living in overcrowded conditions, one of many issues surrounding housing that Generation Housing addresses. According to the organization’s State of Housing report from 2022, Santa Rosa has eight out of 10 of the most overcrowded neighborhoods in the county.

“We’re trying to ultimately reduce the level of overcrowding and give everyone the standard of living that they deserve,” Weeks said. “There are a lot of (developments) in the pipeline, and we really want to see the city and county as a whole continue making good policy choices to keep up with the momentum.”

Another hurdle

Larry Florin, CEO of affordable housing development Burbank Housing, said the economics of building affordable housing in downtown Santa Rosa has been challenging, especially given the increased demand.

Burbank Housing has about 1,700 units of affordable housing in Santa Rosa with fewer than 200 of those in the downtown area, according to Florin.

“We’d like to see the revitalization of downtown Santa Rosa include people of all income levels,” Florin said. “That’s the reason we submitted our proposal for the (former White House department store land) to ensure that diversity of socioeconomic populations are represented.”

Florin said more affordable housing developments also would mean fewer parking spaces would be necessary considering nearby transit options and shorter walking distance to key services.

“(Parking) has a huge impact on the financial feasibility of a project, so being able to produce fewer spaces is really important in terms of making projects affordable,” he said.

You can reach Staff Writer Sara Edwards at 707-521-5487 or sara.edwards@pressdemocrat. com.

“We really need all levels of housing. It’s going to take a collaboration to really make a difference in downtown, with employers, developers and with the city.”

PAULINE BLOCK, Developer Cornerstone Downtown director of marketing, development

https://edition.pagesuite.com/popovers/dynamic_article_popover.aspx?artguid=60e593fa-290f-4b3c-a0ba-86e4bb6985f7&appcode=PRE341&eguid=d9aee25c-3579-4b1a-9ce9-a30d602b259f&pnum=1