Credit Crunch Delays the Promenade at Dublin Ranch
When will the Promenade be built? Many residents in Dublin, CA, have asked this question after Toll Brothers withdrew their appeal last September. The Promenade is planned to be a 230,000-square-foot commercial center featuring a Club Sport, upscale retail and restaurants, and premium office space. While Club Sport has committed to become the first phase anchor, tight credit markets and a glut of vacant commercial space in the Tri-Valley have made financing difficult for Pleasanton-based Charter Properties to go forward with the Promenade.
After a thorough review of the building and parking garage plans, the City of Dublin has sent its comments back to Charter Properties. These comments most likely include suggestions on refining select design elements and bringing certain architectural features into compliance with Dublin’s municipal code and guidelines. If Charter Properties can address the City’s concerns without making substantive changes to the project, the Promenade will be able to break ground.
Although the Promenade is essentially shovel-ready, a tentative grand opening date for the first phase of this long-anticipated project remains elusive. The delay has sparked speculations that Charter Properties may be attempting to sell the land at the Promenade to another developer. Charter Properties has been in a long and very public war with residents in Pleasanton, CA, over the Oak Grove project. Meanwhile Charter Properties is having tremendous difficulty attracting businesses to the beautiful Grafton Station in Dublin. Given these challenges, coupled with the tight credit markets and a glut of vacant commercial space in the Tri-Valley, Charter Properties may be forced to sell one of its most prized possessions in order to meet the growing demand on cash.
In related news, Club Sport has recently indicated that they will be opening at least one instructional studio in the Tri-Valley. Club Sport’s instructional studios will likely have between 15,000 to 20,000 square feet of space dedicated to personal and group fitness classes like nutritional coaching, pilates, yoga, and cycling. Club Sport could be looking to open their new facilities in Pleasanton, Danville, or another city in the Tri-Valley. The impact Club Sport’s new business direction will have on their planned Dublin location at the Promenade remains unclear.
8:39 AM on January 25th, 2010
Sorry to hear about this– I was at the petition BBQ last summer and was very excited to possibly see this start up…
So, if they did sell this parcel off to someone else, what is the possibility that the parcel could/would be redesignated for say, more housing? I’d hate to see that of course, but i want to know if it’s for sure going to be retail as we’ve all been hoping..-
1:29 PM on January 25th, 2010
Please no more housing. In a near future, Dublin will become one of the most affordable community in the Bay Area. Condo prices had dropped near 50 percent. One of the worst performers in the East Bay. I still have some hope about the city future. However, the city has been growing too aggressively to a point which set itself into failure. I am still holding on to my underwater condo in which $180,000 equity has already been wiped out. I may have to consider foreclosing it if there are more bad decision made and move on.
11:21 AM on January 25th, 2010
So, here is how I see the summary of East Dublin saga:
- Grafton station – delay, can’t sign tenants
- Promenade – delay
- “The Green” – delay
- Grafton plaza – delay
- Fallon village shopping center – no reason for that to be built without any of projects above to gain speed => delay
- Staples Ranch in Pleasanton ( Sharks facility , etc.) – no reason for that to be built without Fallon ( and see above) => delay
- Tassajara Prep – I personally would like to have that happen, but do not beleive into viability
- all that will contribute to further drop of real estate values and marginalization of the neighbourhood
So, what’s left for me, who live in “Courtyards”? – very decent Fallon School for my kids. But after 4 years I will have to move out…
7:37 PM on January 25th, 2010
All of these are “ideas”, “concepts”, “projects”.
If none of these promoters had built a web site and started sharing nice maps and drawings, we’d have nothing to argue about and just empty land to fight about keeping green and turned into parks.
If all of these are ever built, the whole discussion will turn into complaining about traffic, parking and intolerant people blasting the profile of the shoppers.
11:06 AM on January 26th, 2010
True – but I moved to Dublin under assumption that one of those projects wil become reality. I do not need ( or want) all of them…just some. Just 2 from that list will be a huge boost (pick any 2). What I get is NONE…Nobody to blame, just me to be a optimistic believer.
The fact that East Dublin “may be OK in 10 year” is irrelevant as that is too long horizon. East Dublin will “not be OK” in next 3 yers is a reality.
1:25 PM on January 25th, 2010
Where you gonna go instead? In case you haven’t noticed, not many other local cities are doing much better– I’d rather stick it out here than move to another city– I’m curious, where would you move to?
1:38 PM on January 25th, 2010
In fact, lots of well developed east bay city fares much better in terms of the housing price, like Albany. Dublin is a fairly new city. Lots of housing inventories were built in the past 5 years, when the prices are very high. Most people who bought within that period of time have probably lose most if not all of their equities. I think we should do now is to slow down all those high density housing development. We need to leave time for the market to absorb the existing inventory and some will come out as forclosed. Let’s focus on attracting more business to come to our city by offering cheap land and lower impact fee. We need to land more high tech and bio tech firms to our area in order to hold up the property value.
3:40 PM on January 25th, 2010
Support!!!
4:11 PM on January 25th, 2010
Some facts about Albany, CA are quite interesting. It could provide an example for Dublin since a lot of people here always claim poorer demographics and smaller schools will do worse in public education. This is definitely not the case for Albany, CA.
From Wikipedia about Albany, CA:
http://en.wikipedia.org/wiki/Albany,_California
“The median income for a household in the city was $54,919, and the median income for a family was $64,269. ”
This compares to Dublin, CA:
http://en.wikipedia.org/wiki/Dublin,_California
“The average income for a household in the city is $101,550.”
The student population for Albany High is 1274 and API score is 861. If you look at the middle school, Albany Middle School has an amazing API score of 964. Do not know why there is a big difference between the two though. In any case, they are better than Dublin’s public schools.
(Source: http://www.greatschools.org/search/search.page?state=CA&q=Albany&type=school)
10:41 PM on January 25th, 2010
Hi George,
Check out the demographics from the API Scores. I think wiki may have it wrong. Albany has a disproportionate number of people who have post-grad degrees. I highly doubt these people are working for $60K. The average education level for parents is 4.14 on a scale of 5. This means that almost all of the parents have at least a masters degree. This doesn’t reflect Dublin’s Demographics at all.
Additionally if you look at the demographics they have a very homogeneous group of students at their small school. (Asian or White make up the majority)
Last small school API’s are calculated differently than those of DUSD. See the * note on the scores at the website. Definitely numbers to shoot for, but the underlying student body is very different from Dublin’s demographics.
http://api.cde.ca.gov/AcntRpt2009/2009GrthSchDem.aspx?allcds=01-61127-6090161
ALBANY CITY UNIFIED 877 850 D 27
Small Schools
Albany High 861*
Albany Middle 964*
Cornell Elementary 900*
Ocean View Elementary 817*
” * ” means this API is calculated for a small school or LEA, defined as having between 11 and 99 valid Standardized Testing and Reporting (STAR) Program test scores included in the API. The API is asterisked if the school or LEA was small in either 2008 or 2009. APIs based on small numbers of students are less reliable and therefore should be carefully interpreted.
11:21 AM on January 26th, 2010
Hi, Rick,
Actually I kind of know why there is disproportional high percentage of post-graduate demographics in Albany and yet the median household income is low. I lived in that community (specifically as a graduate student in UC Berkeley) for several years. There is a UC village with several thousand people – low-cost housing for UC graduate students, postdocs, visiting professors/scholars, etc. Typically, their family income is kind of low.
6:54 PM on January 25th, 2010
Albany is very close to many major employers, which means that the residents there don’t have a HUGE commute. They can work in the east bay or even commute into the city in a relatively short amount of time. Anyone who thinks that Dublin is convenient for commuting to large numbers of major employers is in denial.
3:06 PM on January 25th, 2010
Definitely need to attract more companies to Dublin– I think the new Bart station, when it opens, can really help attract some new businesses..I’d love to see the city get involved with redeveloping the dublin side of the new BART Station (right now it’d kind of the land that time forgot over there)…It needs to be more of a high-end work/live/shop/dine area to attract some progressive companies (look at what Emeryville did with old warehouse)..
3:48 PM on January 25th, 2010
In terms of attracting businesses, Emeryville did a good job. But its public schools are really bad. I do not think its residential real estate is doing good. On the other hand, Albany has a very good public school system, which is why its residential real estate is holding pretty well (if what one poster claimed is true).
7:44 PM on January 25th, 2010
There is a connection between Emeryville and Dublin that most people don’t realize. The Emeryville school district’s superintendent is John Sugiyama, who was Dublin’s superintendent before Dr. Hanke. What a small world!
11:07 AM on January 26th, 2010
We can take Emeryville as an example. The advantage of Emerville is the proximity to the city. However, there is no mass transit availiable. I think we should position Dublin not as a commuting community. It needs to transform itself into a major business hub in bay area, like irvine. By promoting the convinience of bart to go to the city will not do any good. We need to have people coming to work in Dublin where businesses are within walking distance to barts or a short ride of shuttle. In addition, I strongly recommend the city to provide incentives to some major corporations aggressively to establish their base in dublin, like free lease for years. They will eventually pay off when the housing value and retail traffic goes up. Business development is the key.
10:52 AM on January 26th, 2010
You bring up a good point. High end work/live/shop/dine area near bart is definitely what we want. However, the city did not go that direction in the past. Looking at Dublin/Pleasanton Bart, the majority of housing are rental, very low income and affordable units. This is not going to hold up the value. Look at what happened to the Elan Condo. Value dropped 40 to 50% from the peak. I am sure lots of home owners got trapped in it, because of the visionary of the high end concept. In fact, a lot of low income and affordable housing units are piled up in that community.
7:35 PM on January 25th, 2010
Dublin will do just fine in time…many persons i talk with say Dublin is so convenient, everything is here. It will be a long time, however,for Dublin to expect growth. Many businesses are barely making it and many will go into bankrupcy within the next five years. Get ready to bid on the tralee fiaso…gonna be some great prices. site for sore eyes is the most recent victim. gonna be many more. growth will slowly start in TEN years, and another 5-10 for a return to glory. so expect 15-20 years before you feel good…I’ll be 70…yeeeeeeehaaaaaa!
11:10 AM on January 26th, 2010
We are on the same boat.
I bet the tralee condo will be either turned into a rental properties or selling for cheap. Two bed + two bath, about 1000sf will be around $350,000. that the price point that I think they will go for.
7:48 PM on January 25th, 2010
I think a case can be made that Pleasanton is systematically holding up Dublin’s progress. First you have the Stoneridge extension being delayed by a small fringe group of Pleasanton residents, and now you see them depleting Charter Properties cash…
9:18 AM on January 26th, 2010
According to multiple reports from current Club Sport members at the Pleasanton location, Club Sport is letting members know that plans for the Dublin project has been put on hold indefinitely
10:05 AM on January 27th, 2010
headline from today’s WSJ – isn’t just a Dublin problem:
WSJ NEWS ALERT: Sales of New Homes Unexpectedly Fell 7.6% in December
Demand for new homes unexpectedly fell in December, with sales dropping 7.6% from the previous month to a seasonally adjusted annual rate of 342,000, the Commerce Department said. Prices and inventories fell.
Economists surveyed by Dow Jones Newswires had estimated sales would climb 2.8%. Aside from unemployment, new-home sales are suffering because of strong demand for used homes and the looming expiration of a big tax credit.
6:33 AM on January 29th, 2010
At least we don’t have to worry about Sybase. They are doing well.
http://www.insidebayarea.com/…/ci_14288574
6:53 AM on January 29th, 2010
Hi Anonymous – thanks for sharing this bit of good news!
Thx, John Z.
7:58 AM on January 29th, 2010
Some more good news for Dublin:
http://www.contracostatimes.com/…/ci_14288632
8:29 AM on January 29th, 2010
Hi Anonymous – thank you for sharing this article. With all the good news that was published today, I sense that we’ll be having another “Good News” article on Around Dublin.
Thx, John Z.
3:26 PM on January 29th, 2010
It was sold at the average of about $350/SF only for the retail portion. How about the apartment complex? is it included in the deal? If so, the housing price may be proned to drop further then.
8:39 PM on January 29th, 2010
Hi Anonymous – the adjacent Waterford apartment complex was sold to another investment firm about a year or so ago.
Thx, John Z.
8:45 AM on January 29th, 2010
John,
This article on Waterford has me wondering why Charter would want to sell any of their property. In this climate people would want those properties like the Promenade for a discount. However, in a year or 2 when the economy bounces back the people that own those pieces of land will really benefit. The other thing, is that if Charter were to develop the promenade now their constrcution cost would come at a huge discount.
Can you explain how the OakGrove problems affect Charters cash flow? Were they planning to finance other projects with the sale of homes at that development?
I think also in time that Grafton Station will fill up. I can’t beleive that Charter was hoping every spot their would be filled up right when it opened. I would think that they had to know they would have to carry costs for a while.
8:48 PM on January 29th, 2010
Hi Anonymous – I would love to see Charter take advantage of the soft construction market and start building out the Promenade, Fallon Gateway, and Phase III of Grafton Station. However, the credit markets are tight these days with many banks not willing to lend money unless a developer has signed agreements for at least 90% of the planned project. As far as the Oak Grove project, the big expenses there have been for legal services, environmental studies, land use consulting, etc. It’s unfortunate that the Oak Grove project is facing resistance from some of the residents. It looks like a wonderful community that would carry significant benefits for homeowners and open space/park enthusiasts.
While the returns can be phenomenal, developers are required to invest a significant amount of upfront capital for projects. In a market like this, cash is king.
Cheers, John Z.
9:18 PM on January 29th, 2010
Well. The resistance in Oak Grove may be an opportunity for Dublin. Dublin should expedite some of the Charter’s proposal in the city. We should all know why Charter is trying to get planning approval for their projects is to sell them to other developers. Not bad as long as they will focus one or two flagship projects in Dublin. We have been hearing lots of potential developments, but none of them come close to reality. Let’s work with Charter to focus on one or two main centers to bring life to Dublin. At the same time, we should not compromise on our vision in Dublin. Never downgrade the quality of the projects. I absolutely welcome the Pleasantonians have been resistant to growth in Pleasanton, so we can take advantages of it.