A software company that had agreed to lease a floor or more of the former AT&T building has pulled out of the high-profile city redevelopment project.
Arlington, Va.-based Metier, Ltd. was one of two companies that had committed to occupying space in the Museum on the Square project, which would transform the vacant city-owned monolith into a gleaming mixed-use tower.
But after more than a year of negotiation, Metier officials several months ago informed the developers they would not be leasing space in the building.
"We were at the point of documentation when they pulled the plug," said Hugh Futrell, who is developing the project with partner Bill Carle.
Douglas Clark, Metier's chief executive officer, said company officials were still "huge fans" of the project but worried about outgrowing the building. The fast-growing company had tentatively agreed to occupy one floor and was considering leasing a second, but growth projections showed it needing even more space long-term, Clark said.
He expects the company's West Coast operations will need to grow beyond 100 people in three years, and finding that much space downtown is a challenge, he said.
"Once you are confronted with needing substantial office space, it's just not in downtown," Clark said.
The company, which currently has offices at 50 Courthouse Square, continues to consider other downtown locations, but also is eyeing more suburban settings with greater expansion opportunities, Clark said.
"We really want to stay in Santa Rosa," he said.
Futrell said the decision, while disappointing, is not a major setback for the project, which proposes to convert the windowless eyesore into a 10-story glass-clad tower. He said the project remains viable, serious talks are underway with another potential tenant and construction is anticipated to begin this fall.