Plans for a midtown condo complex with trendsetting sustainability standards have hit an all-too-familiar snag: no financing.

So developers of the five-story complex – targeted for the southeast corner of 16th and P streets – now are looking to build a rental complex instead of one with for-sale condo units.

"It will still be the most sustainable, mixed-use residential building in the country," says Katy Reynolds, head of project developer Sukna Global Holdings. And, she says, the rental units will be built to condo standards and eventually offered for sale.

Reynolds, a former Merrill Lynch investment banker, says the financial market went into a "tailspin" earlier this year and potential lenders were especially leery of Sacramento's high jobless rate.

"They said, 'We love what you're doing, but we're just not excited about the Sacramento market,' " she says.

But lenders are much more supportive of rental housing, and Reynolds is confident she can line up backing by the fourth quarter and have construction under way early next year.

The Capitol Area Development Authority, which owns the project site, last month gave conditional approval for the conversion from condos to apartments, says spokesman Tom Kigar.

Reynolds and a team of local partners won CADA's support last year after proposing a mixed-use complex with a "zero-energy" living environment – one that would meet its own energy needs from solar power and include an on-site vegetable garden and fish farm.

A deal, at last

After seven years of marketing efforts, Hewlett-Packard Co. has found a buyer for the massive Roseville building it vacated in 2004.

The buyer is Kansas-based Quality Group of Cos., which is considering a data center on the site.

The sale price for the 300,000-square-foot building on 60 acres at Blue Oaks and Foothills boulevards? Undisclosed, but it's likely about $18 million.

The massive building, known within HP as R21, was occupied by the tech company for just four years before being shuttered and placed on the market. Several potential buyers made runs at the property over the years.

Bruce Wirt, a local Cornish & Carey Commercial broker who represented Quality, says the three-story structure is the "highest-quality, large-floor-plate building in the entire region."

With high ceilings, fiber optic cabling and good security, it's ideal for a data center – one of the real estate specialties of Quality Group. But Wirt says the new owner hasn't decided on a use and has asked him to identify other possible tenants.

HP was represented in the transaction by a team from Cushman & Wakefield's San Jose office with help from local C&W broker Chris Strain.

On the move

It already has two restaurants and a loft apartment building in Old Sacramento. Now Harvego Enterprises is adding a corporate headquarters there, too.

The family-owned company just acquired the historic Pacific Stables Building on Second Street, adjacent to its Firehouse Restaurant.

CEO Lloyd Harvego says the corporate offices will occupy the top two floors of the four-level building. Ground floor space – until recently occupied by a tattoo parlor and a wood carvings business – will be leased to businesses that will have broader retail appeal, Harvego says.

Negotiations with undisclosed prospective tenants are likely to be completed in 60 days.

Harvego's headquarters had been in rented space in Gold River.

But, he says, "We're doing more and more business downtown," making it a good time to move.

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