Village Marketplace Land To Sell At $4 Million Loss?

Monday night the City Council will decide whether to sell a parcel in downtown San Leandro for $4 million less than it paid for the land so that developer David Irmer can build a grocery market, restaurant and retail center dubbed the Village Marketplace.

The city purchased the parcel at 1550 East 14th Street in 2009 through its former redevelopment agency for $6.175 million. That price included demolition of the Albertson's grocery store that had been there.

Last fall, city business development officer Cynthia Battenberg, said the city would sell the land to Irmer at its appraised value, which she then estimated to be $3 million.

She likened the loss on the land to an investment by the city as the marketplace is "really a catalyst project for the downtown," .

Monday night the council will be asked to let the land go for $4 million less than it cost to acquire the parcel.

The staff report says completion of the project will bring the city on-going sales tax and property tax revenues and create about 113 permanent jobs and 500 construction jobs.

The staff memo says that, among other things, the deal calls for Irmer to:

1. pay prevailing wages on construction
2. perform $500,000 in off-site improvements
3. use quality architecture, materials and landscaping
4. provide generous public gathering spaces
5. and attract a full-service restaurant and desired retail tenants like Peet’s Coffee and Tea

Two attached PDF documents lay out the history of the project, the economics of the deal, and the promises, regarding tenancy and aesthetics, that Irmer is making to win approval of the project.

would also include a Fresh & Easy Market, a Chipotle Mexican Grill and an AT&T store.

Irmer has considerable cachet with city staff, who cite his Creekside Plaza Office Complex near the downtown BART Station as a model project.

Should the City Council approve the sale Monday, the land deal would have to clear another hurdle.

Earlier this year, .

The Village Marketplace project was initiated while San Leandro had a redevelopment agency. That agency had a relatively free hand to make deals such as the one that the council will consider Monday night.

But in the post-redevelopment era, the city's decision on the Village Marketplace land sale must be reviewed by an oversight board that includes representatives from Alameda County, AC Transit and the San Leandro Unified School District.

This oversight board meets two days after the council vote. The board could approve the deal or kick it back to the city, adding some uncertainty to the process.

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