A soft real estate market has led to a delay in the start of construction on the first phase of The District – including 20- to 24-units of upscale condominiums – to the west of the Century-14 movie theater.
Developer High Street Victorian Square LLC now has until Dec. 31, 2008, to begin construction on the condominium project, and must finish construction of the condominiums on a total of two parcels of land on the east side of the theater plaza by Dec. 31, 2010.
“The developer believes that, despite the delays and downturn in the residential for-sale market, The District at Victorian Square has unique qualities that will enable it to succeed if the project is modified to adjust to the market,” said Redevelopment Director Armando Ornelas in his report. “The Developer is not only willing to continue dedicating its resources to advance phase one, but is also prepared to dedicate resources to work on phase two.”
The developer is also proposing to reduce the number of condo units and eliminate a parking garage to reduce project costs. Surface parking would replace the garage, Ornelas said. For the change in parking, the developer will need to submit an updated project proposal and a possible amendment to the land use entitlement.
The developer has also determined that land Parcel C to the far east of the theater would not be profitable to develop as condominiums in the near future, and are giving up their right and obligation to develop this piece of land.
On Jan. 7, the city and Redevelopment Agency will start a 90-day period of exclusive negotiations until April 7 for a phase two development agreement to continue to move the project forward.
“I remain very optimistic this is the right project for Victorian Square,” Ornelas said. “The developer is very committed to the project. I am grateful we have a developer that is willing to stick with it. It speaks to their confidence that hopefully we’ll be able to get this done.”
High Street Victorian Square LLC, a subsidiary of Trammel Crow Company, has already invested $1.8 million in this development project.
“They’d be under construction if the market had stayed the course that it was going,” said Councilman Ron Schmitt. “By Dec. 31 2008, if this project is not rolling, they won’t be worried about coming back to city council for another extension; they’ll have a bigger problem with their board of directors.”
Proposed redevelopment plans in the plaza area, making a horseshoe in front of the movie theater, call for between 30,000 to 50,000 square-feet of retail space and between 32,000 and 64,000 square-feet of office space.
“The Developer’s District project would invigorate the downtown, provide a foundation for subsequent phases of the Victorian Square project and, staff believes, trigger additional private investment in downtown Sparks and the surrounding area,” Ornelas wrote in his report.
The preliminary designs of the buildings are modeled after the historic railroad machine shop between John Ascuaga’s Nugget’s parking garage and Interstate-80.
“We’re lining the plaza with a series of Victorian Era themed buildings,” Ornelas said. “It’s much more inviting for commerce and for people in general.”
The development calls for ground-floor retail and upper-floor office uses.
“This design is the basis for negotiations and cost estimates for phase two,” Ornelas said.
Plans call for three-story buildings on the west side of the theater and two-story buildings on the east side of the theater.
The city anticipates leasing about 18,000 square-feet of space for the new city hall.
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