As state treasurer, Phil Angelides championed programs to encourage "infill" development in existing city neighborhoods.

Now that he's out of office, Angelides is tackling one of Sacramento's most difficult urban development sites – 48 acres next to the Capital City Freeway in east Sacramento.

For two decades, this wedge of land hemmed in by the freeway and a set of elevated railroad tracks has been a black hole sucking up developers' dreams.

Angelides, who grew up in east Sacramento, submitted a plan to the city last week to build 397 tightly packed single-family homes on the former orchard, now a vacant field.

Angelides calls his plan McKinley Village. The property is popularly known as Centrage, after the high-rise office, apartment and hotel project proposed for it in the early 1990s by high-tech executive James Lennane. That plan was killed by the Sacramento City Council after intense protest from the neighborhood.

Angelides said his all-residential proposal is less likely to ignite a backlash from residents of adjacent east Sacramento and River Park than some of the previous ideas, which included a shopping center, an auto mall, and Lennane's high-rise "European style" village.

Angelides said he is seeking to "create a 21st century green urban village that draws on the best aspects of Sacramento's existing neighborhoods."

He has teamed up with builder John Laing Homes, which has built urban-style housing projects in such locales as Hercules and the intersection of Hollywood Boulevard and North La Brea Avenue in Los Angeles.

"I'd say it's the best of the Centrage plans I've ever seen, and I've seen quite a few," said City Councilman Steve Cohn. "I've kind of lost count. I think I've seen at least five or six, probably seven."

Angelides, like many experts in the planning field, said he thinks demand for housing close to downtown will boom in the coming years amid concern about traffic, global warming and gas prices.

"There are a set of forces that are going to accelerate demand for urban infill housing," Angelides said.

Before Angelides was elected treasurer in 1998 and ran an unsuccessful campaign for governor in 2006, he was a major developer in Sacramento. He started in the business by working for Angelo K. Tsakopoulos, the region's largest land developer, and later started his own company.

The Centrage site is currently owned by Tsakopoulos, who is in escrow to sell it to Angelides. Seven acres will be set aside for a Greek Orthodox church.

As a developer, Angelides built mostly large suburban projects on former farm fields. He received national attention for Laguna West, a project in Elk Grove that included "New Urbanist" design concepts aimed as creating a more walkable community where people could live near jobs.

Houses in Laguna West included front porches and garages tucked behind houses – novel concepts at the time.

Angelides now splits his time between Sacramento and Los Angeles. He is chairman of the Los Angeles-based Canyon-Johnson Urban Communities Fund, part of a $2 billion urban investment fund co-founded by former Los Angeles Laker Earvin "Magic" Johnson. He joined Canyon-Johnson in January. His particular mission is to acquire more than 10,000 existing apartment units in urban centers around the country and fix them up for working families.

The former treasurer said the McKinley Village project is a personal venture.

In creating the plan for McKinley Village, Angelides hired the same architect, Peter Calthorpe, who designed Laguna West. Angelides said the houses in McKinley Village also will have front porches and parking in back. The plan includes two 1-acre parks, common green areas and a street with a median parkway designed to resemble T Street in Sacramento's Elmhurst neighborhood.

The Centrage site will be an expensive one to develop. A road will have to be punched under a railroad levee separating the property from east Sacramento, and an existing road and bridge leading across the freeway from midtown will need to be improved. The site lacks roads, sewers and utilities.

The last developer to propose building on the property, Cambridge Homes, backed off after the housing market softened. Cambridge Homes' plan was similar to the one submitted by Angelides, but it included multi-family housing.

"It's going to be expensive to develop," said Cambridge President Chris Stevens.

Angelides expects the residential real estate market to turn around by the time he's ready to break ground. "We're really looking at opening new homes here in the spring of 2011," he said. "We think our timing is excellent."

Call The Bee's Mary Lynne Vellinga, (916) 321-1094.