Rohnert Park to purchase former State Farm site for $12.5 million for future downtown

Rohnert Park is set to shell out $12.5 million to buy the property long envisioned as the site of a future downtown, securing for the city the lead role in one of the most ambitious development projects in its 60-year history.

The city is proposing to purchase the 30-acre State Farm property from Laulima Development, which bought the property in 2017 with the intention of building a $400 million mixed-used housing and commercial development to anchor what the planned suburban city has never had: a downtown core.

The project never got off the ground but the purchase could put development of the long-awaited downtown in the city’s hands.

“The best chance of us creating a downtown is for the city to step in and get it moving,” City Manager Darrin Jenkins said. “I’m really excited about it.”

The City Council will consider a resolution approving the purchase during a special meeting at 11:30 a.m. Wednesday. The city is using a surplus in general fund dollars and cash to pay for the land.

The city already owns a 2-acre lot on the southwest corner of the site where the city’s Public Works Department is housed.

For decades, Rohnert Park has sought to create a walkable downtown with a mix of housing and commercial development. The State Farm Drive site has been the lead contender in city discussions since the insurance company began relocating employees and later closed its offices just over a decade ago.

The city is taking a big bet on itself by purchasing the property, but Jenkins noted the city is purchasing it for less than the $13.5 million Laulima bought it for in 2017 and less than what the property is appraised for.

An appraisal last August put the value of the property at $20 million if it were developed, according to city documents.

Purchasing the property will give the city more say over the development of the proposed downtown and could help a project move faster, Jenkins said, noting that the city has a track record of successfully developing city-owned sites into a hotel, apartments and other amenities for residents.

Mayor Jackie Elward called the decision to purchase the property “a bold move” but said that’s what it would take to get a project of this size accomplished.

Elward said it has taken private developers years to advance a project and the city has had limited say over its final shape. Though the development will still take years to complete, at least the city now can have more authority over how it takes shape.

“We are getting our downtown and this purchase brings hope to our constituents who put us in office that what we said we were hoping to do we’re going to do,” she said.

Laulima, a San Francisco-based firm, bought the former insurance company site five years ago and proposed to build a mixed-use development that included 460 apartment units, a luxury hotel and 270,000-square-feet of office, retail and restaurant space.

The City Council advanced the plan for the Station Avenue development in 2018 and the existing building was demolished in 2019. But the project never got off the ground, with developers blaming delays on rising labor and materials cost related to the 2017 North Bay fires and economic impacts of the COVID-19 pandemic.

Laulima notified the city in late 2021 that it intended to sell the property.

Jenkins said the property was under contract but the deal fell through earlier this month, which prompted the city to look into purchasing the property.

“I said well, you know, the city might be interested in buying it,” Jenkins recalled saying after finding out it was available.

The City Council discussed the future of the site in a closed door meeting April 12 but no public report was made after the meeting. Council members and city staff declined to talk at the time about the discussion and calls to officials tied to the property weren’t returned.

City documents show Rohnert Park made an offer the following day to purchase the property, which Laulima accepted.

Anne Kensok, a representative of Laulima, didn’t respond to a request for comment.

Plans for the property could include market rate and affordable housing, a plaza and some retail and office space.

City staffers are eyeing a hotel, which they believe is key to developing the site and bringing and keeping people there.

The city likely will update the current development plans approved for the site and will build infrastructure such as streets and utilities and a central plaza. State grants could help offset developments costs, according to city documents.

The city will sell the developable lots for development of the apartments and commercial space, according to city documents.

Jenkins envisions less office space than the 130,000-square-feet previously proposed as demand for office space has decreased during the pandemic. Construction likely will happen in phases with housing being built first. The original plan called for the commercial space to be built first followed by apartments.

Former Councilman Jake Mackenzie, who served on the council from 1996 to 2020, said creating a downtown remains a top priority for residents year after year in city surveys.

He called the city’s move the best chance for the project to advance after it became clear Laulima didn’t have the means to develop the property.

He characterized the purchase as a “forward step for the city” after an “excruciatingly long process.”

You can reach Staff Writer Paulina Pineda at 707-521-5268 or paulina.pineda@pressdemocrat.com. On Twitter @paulinapineda22.

EDITOR’S NOTE: This story has been revised to correct a date referencing the special City Council meeting on Wednesday at 11:30 a.m. The period in which Rohnert Park has considered the property for redevelopment has also been clarified to note that State Farm closed its offices about a decade ago.