Over the last month we’ve seen such enthusiasm from our community over the City’s decision to take the creation of a downtown into our own hands by purchasing the former office campus at the corner of Rohnert Park Expressway and State Farm Drive. We closed the sale April 29. Less than three weeks later we met in a special meeting with the City Council to discuss how to proceed in developing our new downtown. The discussion focused on choices and trade-offs regarding what the downtown will look like, when it will be built, and how we’ll pay for it.
Timing: We are eager to move quickly because residents have been waiting so long for a downtown. However, we are required by state law to first offer the property to affordable housing developers. At a minimum, this takes eight months. If we don’t sell the property for this purpose, we will proceed with planning, and then building utilities and streets by 2024. Some elements, such as the first housing units, would be completed in 2026 or 2027.
Moving quickly will provide fewer opportunities to obtain grants to off-set the cost, for public input, and changes to proposed plans. We have had extensive public input over the years already. Residents are welcome to provide comments at any time on the City’s website, or at City Council meetings.
Costs: To put it simply, the more public funding we put into the property the nicer it will be. How much we can afford to put in depends largely on how quickly we move, how much housing and retail we put on the site, and how much of that housing is affordable.
Density of housing: Some residents would prefer that the downtown focus on retail such as local restaurants and shops, along with spaces for public use such as a plaza. However, economic reality requires that we provide substantial housing on the site if we are to have retail and public uses. We can sell parts of the property for housing, and invest the proceeds for other uses. Adding 460 units as proposed by prior owner maximizes the value of the land. Adding many more units would require adding parking garages, which are very expensive.
It is worth noting that while housing generates property taxes, it also requires services such as police, fire, and maintenance of streets. The city receives only 11% of property taxes, which does not cover the costs of those services. Thus, adding more housing beyond the current approved density costs the city money rather than providing funds to expand services.
Amount of workforce or affordable housing: Housing sold or rented at below market rates generates less revenue for the City to invest in the downtown. State law requires that 15% of the units we build be affordable to households earning 80% or less of the area’s median income. We could increase the amount of affordable housing, or make it affordable to lower-income residents, but would have less money to invest in amenities.
Amenities: These are the public features that greatly affect the quality of the development. Examples include landscaping, the quality of materials used, amount of public spaces, and the nature of light fixtures, bike racks, benches.
Retail uses – such as restaurants and shops - are a form of amenities. Just as the real estate market puts a premium price on housing, it minimizes the value of retail. Sonoma County, including Rohnert Park, has significant vacant retail space. Even with a strong economy, housing is in demand - retail so much. The costs to build retail are high, while the rents are not. The shift to e-commerce accelerated during the pandemic, making retail challenges even greater.
We know that residents strongly desire a vibrant retail environment downtown; it is one of our highest priorities. We believe that with the City Council’s choices that we will be able to provide a vibrant retail center long-desired by the community.
At their May 17 meeting the City Council approved moving forward with:
-
Early implementation for building the downtown because we’ve already had delays from the prior owners and the community wants us to make good progress.
-
An approach to costs in which the revenues from developed properties will off-set the expenses of operations, without requiring new taxes or reductions in existing services elsewhere in the City.
-
Housing density similar to what the City has already approved, or around 460 apartments and townhouses or condominiums.
-
A commitment to meet the state’s requirement for 15% of units to be affordable to households earning 80% or less of the area’s median income.
-
High-quality amenities.
For further information about the project visit www.rpcity.org/downtown.