April 22, 2009

City to Purchase Former Albertson's Property Downtown

According to a press released issued on April 22, 2009, the City of San Leandro announced that it had reached an agreement with Norcal AL LLC to purchase the former Albertson's lot at 1550 E. 14th Street. The purchase price is $6.175 million and includes the demolition of the building. The property will be purchased with redevelopment funds.

Albertson's vacated the property in 2005 and the property has been the subject of years-long litigation, and had been the proposed site of a Grocery Outlet store. Albertson's originally occupied the property in 1947.

The property will be used for temporary parking during the demolition and rebuilding of the downtown parking garage.

See below for the press release.

FOR IMMEDIATE RELEASE CONTACT: Cynthia Battenberg
April 21, 2009 Business Development Manager
(510) 577-3352

City to Purchase Vacant Downtown Albertsons Site

The San Leandro City Council announced at their regular business meeting on April 20th that they have reached a settlement agreement with Norcal AL LLC, the property owner of the former Albertsons site in downtown San Leandro, located at 1550 East 14th Street. The action came following several years of litigation over the future use of the site. Norcal filed a series of lawsuits in Alameda County Superior Court against the City contending that various planning and zoning actions related to the City's approval of the Transit Oriented Development Strategy for the City's downtown area violated their constitutional rights or were otherwise contrary to law. The City prevailed in three actions now on appeal in the State Court of Appeal. A fourth action is pending in State Court. A priority was placed on resolving the litigation due to the prominence of this downtown site and the blight created by the store vacancy. The Council voted unanimously to the settlement terms which included the Redevelopment Agency’s purchase of the site for $6.175 million and Norcal’s demolition of the building prior to close of escrow. No General Fund money will be used in the acquisition of the property. The site will be used for temporary replacement parking during the construction of a new downtown parking garage. Thereafter, the City will pursue potential development opportunities in accordance with the Transit Oriented Development Strategy. The Purchase and Sale Agreement will be considered by the City Council on May 4, 2009.

Once the building on the site is demolished, the City plans to use the site for temporary replacement parking during the 18-24 month demolition and rebuilding of the downtown parking garage located between Estudillo and Callan avenues. The City will repave and landscape the Albertsons site in late June to make it available in the fall to individuals who currently lease space in the Estudillo/Callan garage.

The Lucky grocery store that had been operating at the location since 1947 had been purchased by Albertsons and was subsequently closed in 2005 due to underperformance. The City is hoping to attract a specialty grocery store to the location once the site is redeveloped into a mixed use development with retail on the ground floor and residential units and/or office space above. This type of development is consistent with the City’s award-winning Transit-Oriented Development Strategy.

For more information, contact the Office of Business Development at (510) 577-3352.

Posted by Mike Katz-Lacabe at April 22, 2009 12:08 PM | TrackBack
Comments

Mike,

Do you know how much was originally paid for this building by Red Mt. Retail? I seem to remember it was around $4 million? If so, no one in their right mind could argue that building has appreciated $2 million in the last few years; so it seems to me like the city was trying to buy its way out of litigation using redevelopment funds. While it's not illegal, it's certainly unethical.

Frank

Posted by: Frank at April 27, 2009 10:36 AM

I would love to see a Trader Joe's there.

Posted by: Jane at September 9, 2011 2:01 PM
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