COVER ARTICLE, JULY 2004

RENEW & IMPROVE
Companies revitalize old properties with new plans.
Brian A. Lee & Lara Rauba

An author once wrote that as long as people are capable of self-renewal, they are living beings. A similar tenet applies to real estate’s renewal or redevelopment. All across the West, companies are breathing new life into old, sometimes forgotten properties. Learning from the past while merging the aims of beautification and business, these real estate players improve cities and communities and tighten the bond between them and the people living there.

Western Real Estate Business recently looked at three projects in California and Colorado to see how redevelopment becomes revitalization.

San Francisco Piers Project

The Port Walk (southview) will allow visitors to stroll from Pier 7 to Pier 1 along San Francisco’s scenic waterfront.

The City by the Bay. For San Francisco residents and visitors, each aspect of this well-known moniker defines the other. Without the bay, the scenic city wouldn’t be the same and vice versa. It’s at the confluence of these two core components of San Francisco that a dynamic revitalization is taking place.

The historic rehabilitation of three maritime piers, located at the foot of Market Street and just north of the recently renovated Ferry Building and Farmers’ Market in San Francisco, began in April. Developer Pacific Waterfront Partners and design architect Hannum Associates have partnered up with the Port of San Francisco on the 70,000-square-foot, $40 million mixed-use project that will feature 60,000 square feet of office product, three restaurants totaling 10,000 square feet and a great deal of public space, including an exterior Port Walk that will beckon visitors to the water’s edge.

Founded in 1978, Hannum Associates does all sorts of design work, from tenant interiors and furniture to office buildings and shopping centers. But the design type doesn’t get the hype — it’s the project. “It’s all based on whether or not there’s a good concept opportunity, a great client or a great site that we find interesting,” says Richard Hannum, president of the firm.

The chance to rehabilitate piers 1.5, 3 and 5 certainly fit that description. Fortunately, the area was protected for a generation from wayward development by the elevated Embarcadero Freeway that cut the waterfront off from the city. After the 1989 earthquake, the freeway was removed and the sun shined on a prime real estate and rehabilitation opportunity.

“Due to the Embarcadero Freeway, the land was never considered that usable or valuable because it was in no-man’s land,” says Hannum. “As a result, it missed early levels of not-terribly-wonderful development that occurred prior to the real growth of historic preservation in the late 1970s.”

It took more than the removal of a freeway to make the San Francisco piers project happen. Hannum Associates’ vast range of services and solid relationships with its partners certainly helped. The design architect is joined by Tom Eliot Fisch, architect of record, Page and Turnbull Historic Architects, and S.J. Amoroso, the general contractor for the project. “Where we live is in the entitlement process and conceptual and design elements of a project,” says Hannum. “In many cases, we put the project together, design the project, get it approved through the bid process and then we work with others to see them execute it.”

Such a complex endeavor required more than 3 years of planning and approval before construction could begin. As a historic preservation and tax-credit project, the rehabilitation work had to be approved by the National Park Service (NPS). The long, arduous process involved around 30 different agencies and three different levels of design review. “The different parties recognize that to accomplish anything of this ilk and scale in the public environment on such sensitive land takes a lot of patience. It’s been a really tough project,” says Hannum.

The first year of construction on the project will be below deck as the “remarkable neoclassic, stucco houses” that run between the Embarcadero and the bay are secured and their foundations strengthened. “A big piece of solving this [problem] was, of course, the structural engineer’s job to figure out how we were going to actually hold these things up and not damage them in the process,” says Hannum. The second year of work will commence the restoration and historic preservation of all of the structures.

The leading design concept for the piers project is to penetrate the existing buildings and invite people to the waterside. The Port Walk will accomplish this by allowing people to walk on the bay side of the buildings, where there was originally no space. This waterside promenade will stretch from Pier 7 to Pier 1. Interior to that will be the History Walk, which links Pier 1 and Pier 3 through the inside of the pier structures. “That is going to be animated with artifacts and other historic memorabilia that will remind people of where they are and why the area is important to the city,” says Hannum.

The largest of the restaurants will be the Pier 1.5 Lounge Restaurant, located on the site of the old Delta Lounge, from which the Delta King and Delta Queen riverboats made their overnight voyage to Sacramento in the 1920s and ‘30s. Hannum says that a key part of the piers project design — which serves as an extension of the highly successful Ferry Building restoration completed last year on the other side of Pier 1 — is the idea that people approached this area of the city by water back before there were bridges. Besides the Port Walk and waterfront dining, other efforts to “positively animate” the waterside include a water taxi station on the Pier 1.5 site as well as a finger pier coming off of the back of the restaurant that allows sailors on the bay to dock during the day. “It will create a destination for people on the bay to approach the city,” says Hannum.

The Ferry Building restoration served as a model for this project in that the principals learned how to approach the NPS for approval of the sites as historically significant and worthy of tax-credit renovation. In the process, Hannum Associates and its partners also had to prove that the space was economically viable. “Even though we’ve gone through a market downturn in San Francisco, the Ferry Building is full,” says Hannum. “Not only is the building full but the restaurants are fully booked — you can’t get in. So we’re looking for the spillover from that success into the balance of the piers project.”

Much of the success of the restaurants will be determined by how much the public is drawn to the waterfront. That is why so much open space was included in the project design — in fact, the incorporation of the public-dedicated space is the largest line item of cost next to the structural rehabilitation of the pier buildings.

2500 Walnut Lofts

The 2500 Walnut Lofts project is a $46 million historic rehabilitation of the old Benjamin Moore Paints property in Denver’s Ball Park Historic District.

A developer that targets historical and architecturally significant urban infill projects should know the market and its history. If that market is Denver, then look no further than St. Charles Town Company. The company name was taken from the real estate firm that plotted all of downtown Denver in 1858. On top of that, one of the founders of the 11-year-old company, John Hickenlooper, is now mayor of the Mile High City.

St. Charles Town Company has redeveloped more than $100 million worth of downtown Denver projects in the past 9 years. Its investment, redevelopment and management focus continues with 2500 Walnut Lofts, an approximately $46 million historic rehabilitation of the old Benjamin Moore Paints property in Denver’s Ball Park Historic District. The three-phase project, which entails both historic renovation and new ground-up construction, will feature condominium lofts, affordable and market-rate housing and commercial space for lease. The first phase, which comprises 40 loft units and 5,000 square feet of commercial space, will be completed in December.

“It’s a very innovative loft configuration,” says Charlie Woolley, president of St. Charles Town Company, who reports that 65 percent of the first phase is already comitted. “We’ve developed a sunburst pattern to the lofts so, instead of being square and rectangular or long and narrow, these are actually pie-shaped with the narrow part in the middle of the floor and the wide part at the windows, where the light and air — the defining features of a loft — [can be maximized]. It’s really a creative solution, we think.”

Woolley describes the 2500 Walnut Lofts design as industrial chic, which will bring a stylish quality to the emerging neighborhood near Coors Field. Colorado-based OZ Architecture handled the design work for the project. “The design itself is a combination of brick and steel and metal panels — very much in keeping with the flavor of the [manufacturing and distribution] buildings around,” says Woolley.

St. Charles Town Company will break ground in August on the second stage of the project, a 21-unit affordable housing facility. The partnership with Mile High United Way heralds the beginning of a model housing program aimed at helping people move from transformational housing to home ownership. The third phase of 2500 Walnut Lofts, set to begin in the first half of 2005, will feature 120 apartment units and 20,000 square feet of additional commercial space.

Bella Terra

The Huntington Beach Mall in Huntington Beach, California, was the oldest enclosed mall in Southern California until The Ezralow Companies stepped in 5 years ago. The company purchased the struggling mall with plans to redevelop it into an open-air lifestyle center. The J.H Snyder Company was then brought on as the lead developer in the transformation of the center into Bella Terra — Italian for “beautiful earth”.

Huntington Beach Mall was originally built in 1966 by The Hahn Company, but over the years, especially with the departure of anchor Montgomery Ward, the center began to decline. It needed to be revitalized in order to continue to compete with other malls and shopping centers in the area. Newer destination centers such as Fashion Island, Irvine Spectrum Center and the Block at Orange drew many shoppers away from Huntington Beach.

Los Angeles-based J.H. Snyder Company, with more than 50 years of experience in retail development, partnered with Calabasas, California-based The Ezralow Companies to help bring life back to the center. “The overriding objective of the redevelopment is the creation of a vibrant town center and destination place for local residents to shop, dine, linger and enjoy Orange County’s spectacular climate in an open-air setting,” says Jerry Snyder, senior principal at J.H. Snyder Company. “The redevelopment and expansion of the center will also bring new retail amenities to the area, along with new jobs.”

The 1 million-square-foot Bella Terra will feature 71 shops and restaurants and a 20-screen, 4,000-seat Century Theatres megaplex. Kohl’s opened at the center in March 2003 and will be joined by tenants such as Bed Bath & Beyond, REI, ULTA Cosmetics, Solitaire Diamonds and T-Mobile. Other existing tenants, such as Mervyn’s, Barnes & Noble, Circuit City, Staples and Burlington Coat Factory, will remain open during the renovation. Sears is building a 150,000-square-foot Great Indoors store on a 13-acre site at the center.

New restaurants that will open at Bella Terra include Kabuki, Daphne’s Greek Café, Pomodoro Cucina Italiana, Islands, California Pizza Kitchen, Johnny Rockets and Krispy Kreme Doughnuts. The restaurants will surround a 300-seat outdoor amphitheater.

In addition to new tenants, the center will also receive a new look. “The new style evokes an Italian village with large public spaces alongside intimate shopping and dining alleys,” says Snyder. Bella Terra will feature buildings of varying heights, tower elements, large piazzas and fountains. A range of colors and textures will be reflected in the stones, ceramics and tiles used for the buildings and courtyards. The Jerde Partnership is handling concept design, Perkowitz + Ruth is responsible for project design and L.A. Group is working on landscape design.

Bella Terra is located adjacent to the 405 Freeway at Beach Boulevard. The center is in a prime location with access to shoppers traveling to and from the beach and between San Diego and Los Angeles. Construction on the $200 million center began in April and is scheduled to be completed next spring.

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