Business & Real Estate

Dollar store, discount grocer now proposed for renamed Curtis Park Village

A view of Curtis Park Village showing the new pedestrian bridge connecting Curtis Park and Sacramento City College and the row of townhouses already constructed on Wednesday, Dec. 16, 2015.
A view of Curtis Park Village showing the new pedestrian bridge connecting Curtis Park and Sacramento City College and the row of townhouses already constructed on Wednesday, Dec. 16, 2015. hamezcua@sacbee.com

The future of Sacramento’s second-largest urban infill development remained in turmoil this week after city officials shot down a developer’s bid to build a Safeway gas station there, and the developer filed a new proposal to fill his previously planned upscale shopping center with a dollar store and other discount retailers.

Developer Paul Petrovich has even said he’s changing the name of his Curtis Park Village project to Crocker Village – presumably to disassociate it from the adjoining Curtis Park neighborhood, whose residents helped defeat the gas station plan.

The situation has left nearby residents wondering if the proposed changes are real or a bargaining ploy by Petrovich – a shopping center developer known as much for his pugnacious personality as his ability to take on challenging urban infill projects.

“We’re still hopeful cooler heads will prevail,” said Kevin Miller-Coe, the newly elected president of the Curtis Park Village homeowners association, which represents the buyers of the first homes built in the new neighborhood.

Curtis Park Village, a 72-acre former toxic railyard sandwiched between two of the city’s most affluent neighborhoods, took more than a decade and tens of millions of dollars to prepare for the construction of hundreds of homes and a sizable shopping center. So far about 20 houses have risen, along with a senior apartment complex and a partially completed pedestrian bridge that crosses the railroad tracks to Sacramento City College.

Petrovich and his Curtis Park adversaries have battled for years over planning decisions, from the size of the retail space to the design of a neighborhood park. Largely left out of the conversation, however, are the eight or nine families who have bought the brownstone-style homes across from the shopping center site in recent months.

Those new neighbors recently held their first homeowners meeting. Miller-Coe and others said they are concerned about the quality of the shopping center and its effect on home sales and prices.

“We have the most to lose from the shopping center not meeting its potential,” the homeowners association president said.

Miller-Coe, a professional property manager, said he and his neighbors expected and accepted that there would be a gas station and a Safeway across the street when they bought their homes – but not a dollar store or a discount grocer.

The dispute between Petrovich and his adversaries, and the uncertainty it has created, already have disrupted home sales by builder BlackPine Communities, Miller-Coe said.

Robert Wassmer, a professor of public policy and an expert on urban land development at California State University, Sacramento, said the level of animosity between Petrovich, the Sacramento City Council members who voted down his gas station plan, and the Curtis Park neighbors is unusual, but that some of it might be for show.

“I think it may be just part of the negotiating phase they’re going through, and Petrovich is trying to show them, ‘If you’re worried about the image of the place with the gas station, I can make it even worse,’ ” Wassmer said.

Large red-and-white signs Petrovich recently erected at Curtis Park Village proclaim a Grocery Outlet bargain market, a pet supply store, a barbecue joint and a chain hair salon will be “Coming Soon!” (Petrovich has used large signs in front of his developments to drive home a point before).

Revised plans submitted to the city last week also note a “$1 store” may be a typical tenant.

“If the city holds its line, will he actually put the dollar store in or the Grocery Outlet?” Wassmer asked. “I would guess probably not. It would not be good overall for the residents he wants to attract there.”

A dozen two-story homes across the street from the bare land where the shopping center will be built have been selling for about $600,000 to $800,000. A half-dozen more expensive homes are under construction nearby on Crocker Drive, the new neighborhood’s main street, and larger single-family homes in the $1 million range are planned for vacant land within sight of the shopping center.

The century-old Land Park and Curtis Park neighborhoods, which border the infill project, feature hundreds of vintage homes in the same price ranges.

Greg Guerrero of Natomas paused on a walk down Crocker Drive on Wednesday and said he didn’t believe discount retailers would be the shopping center’s anchor tenants, given the area’s home prices. Petrovich, he said, was “thumbing his nose” at those who wouldn’t let him have his way.

“I could see Whole Foods or Bel Air, but not Grocery Outlet,” Guerrero said. “It doesn’t seem like it would fit the lifestyle.”

Petrovich has refused for months to discuss the project with The Sacramento Bee because, he says, he believes the newspaper’s coverage is biased and negative.

“I have no interest in helping The Bee further a story when they’ve assassinated my character,” Petrovich said Tuesday in a brief phone interview.

The developer has repeatedly said in other public comments that he’s not bluffing about the discount retailers. He has said he was forced to pursue Grocery Outlet as a tenant after the Sacramento City Council denied him a permit last month to build a gas station on the site. Safeway, which he had lined up as a potential tenant, said it wouldn’t build a grocery store without a gas station.

Other developers and commercial real estate experts said they understood Petrovich’s dilemma.

Steve Edwards, a commercial real estate broker who represents Walmart in the Sacramento region, said Petrovich had little choice but to pursue another tenant once Safeway pulled out.

“Obviously, if there was an option for Paul to build a nice center where he would get more rents and pay the bills, he’d do it,” Edwards said. But “at some point you have to pull the trigger. He had all the cleanup and the carrying costs. He fought and fought and fought to secure entitlements. He can’t just sit there and wait forever for the perfect (retail mix) that makes everybody happy.”

The larger area around Curtis Park Village includes both high-income and working-class neighborhoods, making a mix of customers important, Edwards said. And gas stations have become a key part of the grocery business as a draw for customers, he said.

“The market makes the decisions,” he said. “The developer doesn’t get to pick and choose.”

City officials, however, say the shopping center’s future tenants remain in question.

Assistant City Manager John Dangberg said the city is taking Petrovich at his word, but that talks continue behind the scenes. The goal, he said, is to bring in an appropriate mix of retail for one of the city’s most promising new neighborhoods.

“I can say that (compromise) would certainly be our goal, to work out a satisfactory compromise that is in the best interests of everyone,” Dangberg said. “I’m hopeful that we can.”

Hudson Sangree: 916-321-1191, @hudson_sangree

Sacramento’s major infill projects

  • Downtown railyard, 244 acres, planned mixed-use development on site of historic Southern Pacific railyard
  • Curtis Park Village, 72 acres, housing and retail being built at former Western Pacific railyard
  • McKinley Village, 49 acres, new neighborhood under construction on once-vacant land in East Sacramento
  • The Mill at Broadway, 32 acres, housing being built in a longtime industrial area near Interstate 5
  • Sutter Park, 20 acres, homes to be built on former Sutter Memorial Hospital property
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