BUSINESS JOURNAL EVENT

2008 Health Care Conference: Frontiers of Health Care

Wednesday, November 12, 2008, 8:00 a.m. - 11:30 a.m., Hyatt Vineyard Creek Hotel & Spa, Santa Rosa

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SMART, Creative Housing reach tentative agreement on Railroad Square

SANTA ROSA, Oct. 18, 2007 – The Sonoma-Marin Area Rail Transit District announced yesterday that it reached a tentative agreement with Los Angeles-based Creative Housing Associates on a mixed-use development plan for Santa Rosa’s Railroad Square.

The development, which would be next to a proposed SMART commuter rail station, would include affordable apartments, market-rate condominiums, a food and wine center, a public plaza and retail and office space. SMART, which is seeking to establish rail service between Cloverdale and Larkspur, sees the development as a way to boost future ridership on the rail line.

In a key change from earlier negotiations, SMART agreed to accept as little as $2.5 million for the land to be developed, after citing appraisals during earlier negotiations with Creative Housing and other developers that ranged from $3.9 million to $12 million.

Under the new agreement, Creative Housing would pay SMART $500,000 before and during construction and at least $2 million when the project is finished. The last payment could increase with inflation if construction takes more time than is expected. SMART would also receive an estimated $2.25 million to $5 million over 30 years in transfer fees paid on future townhouse sales.

Creative Housing and SMART are still months away from a formal agreement, which hinges on the developer’s ability to find more funds to cover the project’s estimated $100 million cost. Creative Housing said today that it is still $15 million to $20 million short of meeting that cost, and it will ask the city of Santa Rosa and other government sources for money.

“We think that because the project is a high priority for the city of Santa Rosa, it’s a transit-oriented development project, it’s going to have a ‘LEED platinum’ rating [for green building], there’s a number of state and federal sources that are going to be very amenable to our project,” Creative Housing principal Michael Dieden said.