An exclusive deal between the city and a Southern California company to build a major project near the BART station expired May 30, and city officials are expected to decide tonight whether to extend the agreement or start the search for a new developer.
Irvine-based Fancher Partners, which has exclusive rights to develop a five-acre parcel near the Millbrae BART station area, is going to ask for a three-month extension on the agreement, citing difficulties in securing a financial partner to bankroll the development and further problems assembling all the private properties currently on the site.
The Millbrae Station Area Specific Plan, dubbed Site One and adopted in 1998, aims to encourage development in the area surrounding the BART-Caltrain hub. City Manager Ralph Jaeck said that Site One may have been well under way had the dot-com bubble and the terrorist attacks of Sept. 11 not destroyed the economy, particularly the office-space market.
“The economy is coming back and now is the time to see some movement on that site,” Jaeck said.
A $200 million-plus project that includes retail, housing and most likely a cinema is planned for Site One, which includes Peter’s Café and Millbrae Lumber.
Assembling all 10 properties on the site has proven to be a tough task. There is some disagreement on how much the owners of the properties should be paid, even though the owners have been very amenable to the buyout. Still, Jaeck said that three months should be enough time for developer Chuck Fancher to prove that his company will make significant progress on buyouts by year’s end.
Though the exclusive development agreement is only slightly more than a year old, Jaeck said the city has been in discussions with Fancher for at least three years.
“The discussions have gone very well,” Jaeck said. “We think it’s reasonable to give them another opportunity to produce results and we think they will. If not, the city will have to decide whether to look for another developer for this site.”
The City Council is scheduled to discuss the issue at its regular meeting tonight.