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Sunday, April 28, 2024

Promised "Destination Restaurant" Site Sits Empty For Nine Years

 Developer/City Scams Emeryville Citizens 

"Non-Chain Destination Restaurant" Promised for Parc-on-Powell Project Was Never To Be 

5700 Hollis Street
This was going to be a non-chain restaurant 
serving the community.  Instead, for nine years it has been
vacant like so many other Emeryville storefronts.
With promises of a non-chain destination restaurant made to the public from City Hall and a very visible prime central Emeryville location opening directly onto a park, people may wonder why the storefront retail at the ‘Parc on Powell’ project at 5700 Hollis has remained empty since the site was developed as a mixed use project more than nine years ago.  The storefront, over 3000 square feet in size sits below a large apartment block and has been ready for a tenant for almost a decade.  But it remains vacant like so many other empty storefronts in Emeryville, a festering wound on the town’s retail streetscape.  A recent Tattler investigation found there was never any intention to bring a restaurant here despite all the promises from the developer and the City.


A quick check reveals money is the primary reason this has not rented out to any retail tenant.  At $13,000 per month and the encumbrance of a minimum five year lease, so far no retailer feels they can turn a profit at this location at that price.  On top of that, we found out recently the space was built back in 2015 in such a way as to preclude a restaurant, so says Megan Basso of Walnut Creek’s Lockehouse Realty, the retail broker assigned to the address.  Ms Basso has been trying to rent out the space to anybody for years, it’s just that no takers have surfaced she says. 

The storefront sits right on a park, with an outdoor seating
area adjacent to the green.  Perfect for a restaurant.

After publicly made verbal guarantees from Emeryville’s former Planning Director, Charlie Bryant to the whole community that a restaurant would rent out the space, we find out nine years later that was never going to happen.  Plumbing, HVAC and other infrastructure necessary for restaurant use with apartments above, was not designed into the space from the beginning, rendering the space unworkable for restaurant use.

Heading off any opposition from the community for the proposed development back in 2015, the City sweetened the pot by dangling a destination restaurant before the public.  The development proposal sailed through the approval process without substantial community objection.  That might have been the only use of the "restaurant" to the City (and the developer).   

This is the green just off the small plaza fronting the 
would-be restaurant.  Perfect for outdoor dining with kids.
But, protecting the developer, the City lied to us.
Restaurant or not, libertarians among us might wonder why the property owners don’t start lowering the rent until they get any taker; the whole supply and demand thing.  In reality, many if not most apartment tower owners in Emeryville (usually large real estate investment trust corporations) are not interested in renting out their storefront retail spaces and they just write it off as a loss for tax purposes.  It’s the same reason why the Sherwin Williams developer on Sherwin Street  (called ‘The Emery’), Lennar Corporation, hasn’t rented out the retail associated with that property.  After years of promising local neighborhood serving retail at both the Emery and Parc on Powell and after the City of Emeryville refused to get the assurances in writing, now these developers are letting the storefronts sit empty, bringing down the neighborhoods.  

This scenario has repeated itself over and over again over the years in Emeryville.  The only reason why there is retail storefront at each new apartment tower is because the Emeryville Planning Department is forcing the developers to put them in so they can sell the project to the public as a General Plan conforming ‘mixed use’ development.  After that planning box is checked, there’s nobody minding the store (so to speak) and the retail sits empty for decades as the developer takes his tax write off.

Director Bryant has since retired and was unavailable for comment for this story.


7 comments:

  1. How many times have we heard this story: it wasn't put in writing and then the business failed to live up to their agreement? Where was the city attorney when this deal was made?

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  2. As a 35 year resident of this city I am appalled that the underhanded dealings that we all thought were resolved in the 1980's and 1990's continue on unopposed with the usual apathy and disinterest of city residents. The arrogance and secrecy of the city continues on unchecked and even the so-called, Code of Ethics" is a laughable mechanism where city council members and the mayor evaluate themselves with no outside ombudsman to call their ruse. The city continues with its fiefdom that evades accountability... Editor, Brian Donahue and city councilman, Kalimah Priforce, are the only voice of conscience this city has now.

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    1. I wouldn't go as far as you have gone. I think there are many people concerned about the misuse of power in politics in Emeryville. They're just not as loud. I do agree an independent ethics commission, the enforcement arm, is necessary to back up the Code of Ethics. No government on Earth can be trusted absolutely. We need to always watch them and they need to know they're always being watched. Misdeeds need to be punished. What keeps them in line is the fear of consequences.

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  3. This article would be more effective if the author showed us the math that proves that keeping the site empty and taking the writeoff is maximizes profit

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    1. The calculations of which you speak are made frequently by CFOs and others who control those kinds of decisions at apartment project locations all over Emeryville. How do we know? By the fact that so many storefront retail spaces have been left permanently vacant. The proof is in the pudding as they say. We have to assume all these corporate landlords are not bumbling idiots.
      Each corporation is different and I have no way to examine their spreadsheets but I can report how many have decided to let their retail storefronts sit empty. I do assume most have decided that with a rational basis but for some there may be some phycological factors at play. Ultimately, it really doesn’t matter. The part Emeryville citizens should understand is the folly of government proclamations (in this case about City Hall’s desire for mixed use zoning) without proper follow through diligence. With the case of Parc on Powell, the other take away for citizens is they should know their Emeryville government helped this developer through the approval process by misinforming the public.

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  4. Do you know how the corp. calculates the write off, and what agency can say NO to an absurdly high figure?

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    1. Again, corporations are self interested. They make decisions based on their self interest. I assume most of the time calculations are based on purely fiduciary grounds. But I also think sometimes some amount of psychology colors their decisions. However this is tangential to the story.

      The citizens care less about why the corporations want to leave their storefront retail vacant and more about why the City is allowing the corporations to have that decision to make. The citizens have an interest in seeing the storefronts be rented out to (locally serving non-chain) businesses. The corporate landlords may or may not have an interest in renting out their storefronts.

      This issue is begging for a public policy fix but so far, no Council members have shown enthusiasm in pursuing the citizen’s interests.

      The government ‘agency’ that can say NO to this is the City Council. They can make renting out the storefront retail part of these huge apartment projects a requirement as part of the approval process.

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