Sacramento developer Michael Heller plans to turn old Crystal Ice plant into shops, restaurants

A pedestrian walks past the old Crystal Ice and Cold Storage plant on R Street in Sacramento on Thursday. Developer Michael Heller is about to submit plans to the city to rehabilitate the dilapidated structures between 16th and 18th streets for use as retail shops, restaurants and residential units.
A pedestrian walks past the old Crystal Ice and Cold Storage plant on R Street in Sacramento on Thursday. Developer Michael Heller is about to submit plans to the city to rehabilitate the dilapidated structures between 16th and 18th streets for use as retail shops, restaurants and residential units. rbenton@sacbee.com

Cavernous and decrepit, the century-old Crystal Ice and Cold Storage plant in midtown Sacramento is a key piece of the city’s efforts to turn the once-gritty industrial corridor of R Street into a thriving arts district.

But for the past 20 years, plans to tear the plant down or renovate its buildings, which take up most of the two blocks between 16th and 18th streets, have fallen to official opposition or a sinking economy. The plant remains a prominent eyesore.

Now, Michael Heller, a local developer experienced in the creative reuse of older structures, believes he has a solution that will preserve the best of the plant’s aging industrial character while creating a modern mecca for shoppers, diners, office workers and a slew of new residents.

Heller’s plans call for the oldest sections of the ice plant – a series of nine interconnected buildings with plank floors, brick walls and massive sliding doors – to be rehabilitated as 82,000 square feet of stores, restaurants and offices.

There would minimal changes to the interior appearance, if Heller has his way. The wood and concrete walls, rusted fixtures and long rows of columns holding up the ceiling are similar to what a high-priced creative team might come up with for a trendy store or eatery, he said.

“It’s almost like a gift,” Heller said. “I don’t have to hire a designer. I just have to keep it.”

Under the plan, two less historic ice plant buildings next door would be torn down to make way for 145 apartment lofts, and retail structures of corrugated metal would sit beside the brick facade of the former Orchard Supply Co., another derelict building across R street with a caved-in roof.

The project would build or repurpose more than 200,000 square feet of shopping, dining, living and work spaces.

“It’s kind of a village we’re creating,” Heller said.

The developer intends to submit his plans to the city this week and has named the project “Ice,” with the different sections of the proposal called Ice Blocks 1, 2 and 3, or Ice House, Ice Garden and Ice Shop.

There’s no doubt the buildings present large obstacles to redevelopment, Heller said. Ceilings are falling down. Squatters regularly break in. Graffiti and an empty case of beer were signs of recent occupancy last week.

Heller has hired engineers to assess the buildings for structural integrity, dry rot and other issues.

“It’s just taken an enormous amount of hours,” he said. “There’s just every conceivable challenge. This is why I like it so much.”

Some city officials have expressed confidence in Heller’s abilities. His prior work includes the MARRS (midtown art retail restaurant scene) building on 20th and J streets in midtown. The former moving and storage building is now a centerpiece of midtown nightlife, with a dozen upscale shops and eateries on the ground floor and offices upstairs.

Though Crystal Ice will be challenging for Heller, “I think he’s going to get there,” said Wendy Saunders, executive director of the Capitol Area Development Authority, which oversees the R Street corridor. “This is sort of a big MARRS project. That was a dumpy, ugly building, and he really brought life to it. This is just on a much bigger scale.”

Work will start this week on a $3.6 million project, funded by CADA and the Sacramento Area Council of Governments, to redo the street in front of the ice plant with trees, sidewalks and a new road surface to replace the current expanse of crumbling concrete and dust.

Heller isn’t the first developer to see Crystal Ice’s potential. Its prime location and buildings have attracted others for decades, but none has succeeded.

Developers Angelo K. Tsakopoulos and William Cummings bought the plant in 1970. It ceased operations altogether in 1993, and in the mid-1990s, the developers proposed tearing down the structures and building twin office towers.

The area is just down R Street from the state Department of Correction and Rehabilitation’s headquarters and a large parking garage. But city officials rejected the proposal because it didn’t fit with the plan to transform R Street into a corridor of mixed-use housing, shops and low-rise offices.

Developer Paul Petrovich, who built the Safeway shopping center that anchors the eastern end of the R Street corridor on 19th Street, tried to buy it but couldn’t come to terms with the then-owners.

In 2005, Sacramento developer Mark Friedman tried to put his stamp on the area.

He bought the Crystal Ice buildings in 2005 with plans to build a retail and housing complex. Friedman said at the time he hoped to save at least some of the buildings, including central portions of the main structure that date from the 1920s. He also envisioned outdoor dining on the plant’s raised loading dock.

Then the economy tanked, and Friedman’s ambitions for Crystal Ice went down with it.

When Friedman was tapped to head the current effort to build a new downtown arena for the Sacramento Kings, the prospect of also taking on Crystal Ice was too much, Heller said. Friedman considered selling, but Heller said he persuaded Friedman, his partner in other projects, to hang onto the properties and let Heller take over as lead developer.

Today, the complex of brick, metal and concrete buildings retains a grungy appeal. Yellow caution tape cordons off vast rooms where sunlight streams through holes in the ceiling. Long strings of work lights cast shadows on walls. The cavernous spaces are silent, though massive ice-making equipment suggests the activity that once took place there.

“I love this haunting feeling,” Heller said.

The developer says he can see beyond the plant’s current conditions to a time when the blocks around the former ice plant would be like Berkeley’s Fourth Street shopping district, the Pearl District in Portland, Ore., and other places where gritty post-industrial landscapes have been transformed into hip, economic powerhouses.

“Most every city has these iconic districts,” Heller said. “We want to be part of that industrial vibe.”

Call The Bee’s Hudson Sangree, (916) 321-1191.