A downtown developer is downsizing his plans for the former AT&T building in Santa Rosa because he's under the gun to get the long-delayed project moving this summer.
Hugh Futrell is asking the city to let him chop five stories off what had been a 10-story mixed-use tower dubbed Museum on the Square, eliminating entirely the project's residential component.
The change is needed to simplify the financing and speed up construction of the project to prevent tenants for the office space from pulling out of the deal, Futrell said.
"We still believe this is a critically transformative project for downtown Santa Rosa," Futrell said.
The city's former redevelopment agency purchased the long-vacant AT&T building in 2007 for $3 million. The plan was to find a developer to revitalize the windowless concrete structure, which many viewed as an eyesore in the heart of downtown.
Futrell partnered with TLCD Architecture to design a glass-clad building housing the Sonoma County Museum and a restaurant on the first floor, with four stories of offices above. On top of that, they proposed five stories with 43 apartments.
But the challenging financing environment and demise of the redevelopment agency conspired to repeatedly stall the project. The 2010 contract to sell the building to Futrell for $2.1 million has been extended three times, most recently through the end of this year.
The state Department of Finance threw a monkey wrench into those plans in March, informing the city that the extensions conflicted with the requirement that the former agency "expeditiously wind down" its affairs. Instead it directed the city to "terminate or renegotiate" such contracts with an eye toward raising revenue.
Financing for the original project was also being held up by its reliance upon federal tax credits, which Futrell said "introduce tremendous complexity to the whole process."
So when it came time to renegotiate the deal with the city, Futrell realized the only way he could get it done quickly enough for an August construction start was to simplify the financing and revert to a more conventional approach.