Every Santa Barbara resident has most likely been to the Paseo Nuevo shopping mall in Downtown Santa Barbara. The downtown venue is popular for shopping, has great lunch and dinner spots, and is a community staple. But in the City of Santa Barbara’s recent push for affordable housing, developers and investment firms have set their sights on the location for a different purpose.
The Georgetown Company, a New York based, privately held real estate development, investment, and property management firm—with over 3 billion dollars in assets—has new plans for the Paseo Nuevo Mall. They often take underperforming developments in cities and rework them to the community needs. Their proposals include building 233 market-rate housing units and an additional 80 affordable units. A new multi-family building will be built along Ortega, replacing the old Macy’s building and an affordable building will replace City Lot 2, and the existing Paseo Nuevo mall will stay as retail.. The project, spanning three city blocks between State Street and Chapala Street, would cost hundreds of millions of dollars, and involve tearing down the vacant Macy’s store on West Ortega and City Parking Lot 2.
The Santa Barbara Planning Commission rejected the proposal in an Oct. 9 meeting, disrupting the city staff’s effort to cut a deal with the mall leaseholder. One major argument made by the Planning Commission staff was the plans to give the city land under Paseo Nuevo (in addition to a portion of the property’s tax revenue) to developers, valued at an estimated $32 million. So far in meetings, City Administrator Kelly McAdoo and her predecessor Rebecca Bjork have been working to re-envision the “failing” mall. McAdoo has repeatedly stated that it is necessary to give the land to the developers as an incentive.
Commissioner Brian Barnwell said, “This sounds like we are desperate… I don’t ever remember such an ill-defined proposal coming in front of me. I am quite shocked.” Other commissioners, including Commission Chair Lucille Boss have said “giving [the land] away is really concerning to me.” Other proposals include giving the developers a 99-year lease on the property, who have 40 years on the existing lease.
This project would leave the bottom layer of the Paseo Nuevo mall open to the public, keeping it similar to how it is now with retail shops. The City Council is expected to meet on Dec. 2 to consider the development agreement, where community members get a chance to voice concerns and opinions on the project.
