The developer of a transit-oriented project at Railroad Square wants to shift the location of affordable housing units in an attempt to jump-start a companion project.

The John Stewart Co. is asking the Sonoma-Marin Area Rail Transit agency for permission to move 68 senior housing units from the "transit village" on SMART's property to the adjacent Cannery project Stewart also owns.

Doing so could get the Cannery project going because financing is available for affordable housing, and a tenant, Club One Fitness Center, is lined up to take a major share of the building, said John Stewart, the company's chairman.

"This is not the market it was three or four years ago," Stewart said. "We need to start what we think is going to be financeable."

Railroad Square residents, however, are looking for a guarantee that if the units are moved, that someone won't come back in the future and demand more affordable housing on the SMART project.

"Our neighborhood is home to the Redwood Gospel Mission, we are home to the soup kitchen, we have 32 units of Burbank Housing in our neighborhood," said resident Carol Dean. "We feel we are doing our fair share down here."

Resident Allen Thomas said he and neighbors want the negotiations between Stewart and SMART to be public.

One of the sticking points for the neighbors is the contract negotiated with SMART by the Accountable Development Coalition, a political activist group, that sets a requirement for the number of affordable housing units on the SMART property. They want that contract, called a Community Benefit Assessment, to be amended to acknowledge that SMART's affordable requirement would be met by the Cannery project.

"We are concerned that there will be potential where someone will come back in three years and say you promised to put at least 40 units on the SMART site and you cannot count those 68 units," Thomas said.

Stewart is lead developer in the New Railroad Square Project, which has evolved from a SMART-only project, once envisioned to be similar to the Ferry Building in San Francisco, to now also include the Cannery.

Under the agreement, New Railroad Square has an option to buy 8 acres of land owned by SMART for a food-and-wine center, offices and both market-rate and affordable housing.

The developer owns the Cannery, which is an adjacent and historic warehouse building that had been proposed for live-work condominiums.

Now, however, Club One Fitness Center is interested in taking the first two floors of the Cannery, totaling 44,000 square feet, for workout rooms, a basketball court and running track, plus putting in two swimming pools outdoors.

Stewart said shifting the 68 affordable senior units from the SMART site to the Cannery's top three floors makes public financing available, which would be key to getting the Cannery project under way.

Total cost of the project would be about $44 million, Stewart said.

"We had planned 93 market-rate condos, but there is no market yet," Stewart said. "But we do believe we have a good chance of financing the affordable housing side of the site."

The city of Santa Rosa through its redevelopment agency, housing authority and a state grant has $15.4 million committed to the projects at both the Cannery and the SMART property.

It would have to approve a change in Stewart's plans.

"With that level of investment by the local community and the fact it is a redevelopment district, there is a strong desire for that project to move forward," said Jocelyn Lundgren, Santa Rosa's economic development and housing manager.

Community development director Chuck Regalia said Stewart has submitted project descriptions to the city for review.

"There are a lot of issues to work out; we still have to do project review and environmental, but we see it as a plus, it would create positive action on the site, it would bring in a business, it would bring in affordable housing," Regalia said. "From my perspective, I see it as a positive thing."

SMART Chairwoman Debora Fudge said that if Stewart is successful in getting the Cannery developed, she believes it would enhance the chance of getting the SMART project built as well.

"This allows the Cannery building to start, which I think will add value to the SMART property, because there will be something built next to it," Fudge said. "When the market improves, more tenants would be willing to sign up."