Chinese developer’s purchase of Sonoma Valley property could revive resort project

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A large undeveloped property near Kenwood that was at the center of a bruising land-use fight a decade ago has been purchased by a Chinese real estate firm, raising both eyebrows and questions about the future of the picturesque community in the heart of Sonoma Valley.

The $41 million purchase, of a 186-acre site off Highway 12 near Lawndale Road, includes rights to develop a luxury resort and winery, along with a restaurant and almost a dozen high-end homes.

It remained unclear this week what the new owner, Tohigh Property Investment, a subsidiary of Chinese developer Oceanwide Holdings, intends to do with the property.

San Francisco attorney Paul Schrier, who’s representing Tohigh, declined to comment on the acquisition, calling it “premature.”

The seller, Bob Piccinini, chairman and CEO of Modesto-based Save Mart Supermarkets, was not available for comment.

It’s likely, however, that the development could be revived after being stalled by the economic downturn and a lawsuit filed by a citizens group opposed to the resort project.

Utilities have been installed for the property and an entrance road was constructed, with additional improvements made to Highway 12, including turn lanes. Since the county approved the project in 2004, not much else was done at the property, known as La Campagna. Outside of vineyard lands, the property constitutes one of the largest single pieces of undeveloped real estate left on the valley floor off Highway 12.

Oceanwide has been aggressively buying real estate in California over the past two years.

Last month, it announced plans to build in San Francisco’s Financial District two tower buildings, which will include apartments, hotels, offices and commercial space. One, at more than 850 feet, is expected to become one of the city’s tallest skyscrapers.

Residents and business people in Sonoma Valley are split on the acquisition, much as they were on the development proposal years ago.

The project calls for a 50-room inn, spa, 125-seat restaurant, 10,000-case winery and 11 luxury homes to be built on a portion of the old Graywood Ranch at the foot of Hood Mountain.

“It’s been on the Sonoma Valley’s radar for a while,” said Henry Belmonte, owner of VJB Vineyards and Cellars, just a mile from the proposed resort. Belmonte is in favor of the resort project.

“It’s a phenomenal opportunity for this valley if the same thing that was promised is finalized,” he said, arguing that the popular wine destination is in need of more luxury lodging. “There are limited places to stay of that quality, and you see (tourists) go somewhere else.”

Bill Foss, owner of Kenwood Restaurant, agreed it’s a good opportunity for the area.

“Sonoma Valley is the most beautiful stretch of real estate in the county,” he said. “(But) it doesn’t seem like anything wonderful has happened in a long time.”

He said it’ll help “raise the bar” in the area, providing an infusion of high-end commercial activity. Although residents are concerned about dwindling water supplies, increased traffic and a loss of rural character, Foss voiced confidence in county officials to limit any significant impacts.

“Whatever happens there will be done (under) the most stringent criteria,” Foss said. “I hope the operators bring what the area deserves: world class.”

But opponents say development of the vacant property, dotted by a few oak trees on the valley bottom, would come at a high cost to residents already dealing with heavy traffic from the numerous wineries and tasting rooms that have sprouted in the area in the past few years.

The nonprofit Valley of the Moon Alliance filed a lawsuit alleging the project would harm the environment after the county approved it in 2004. The group lost on appeal in 2006, but still managed to stall the project before the economy tanked.

“We’ve been enjoying the landscape and the scenery there for the past 10 years,” said Kathy Pons, president of the Valley of the Moon Alliance. Pons has lived for nearly four decades in Kenwood, an unincorporated community surrounded by vineyards and lush fields framed by giant oak trees.

“We’re a little bit nervous about what’s going to happen now,” she said, adding that residents are concerned about the new developer.

“All I can do is shrug my shoulders and say, ‘It’s a project that’s been approved,’ ” Pons said. “All we can do is make sure it complies to what was approved originally.”

Del Rydman, a longtime resident who served as the alliance’s president when the group filed the legal challenge a decade ago, worries about a foreign company coming into the Sonoma Valley to build what already is a disputed development.

“It raises red flags,” he said, adding that the developer won’t care about the impacts on the local community.

“They just want to make money,” Rydman said. “It’s about the bottom line for them.”

Piccinini, the former owner, initially partnered with Auberge Resorts to build and operate the hotel and expected to charge more than $500 a night for lodging. The Mill Valley company that operates luxury resorts and five-star hotels worldwide, including the Auberge du Soleil and the Calistoga Ranch, both in Napa Valley, later backed out.

Any major changes to the development approved by the county in 2004 could set off a new review process, opening up the project to further public scrutiny and potential delays.

“If you modify it, it’s going to be a problem with the community. We’re going to be very conscious,” Rydman said.

So far, the new owners haven’t submitted any changes, said Dean Parsons, a project review manager for Sonoma County.

Supporters said the new owners would be wise to avoid any substantial changes to the project, saying such revisions would likely face intense opposition from many in the community.

“I hope they’ve done their homework,” said Belmonte, the VJB Vineyards owner.

You can reach Staff Writer Eloísa Ruano González at 521-5458 or eloisa.gonzalez@pressdemocrat.com. On Twitter @eloisanews.

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