BUSINESS JOURNAL EVENT

2008 Health Care Conference: Frontiers of Health Care

Wednesday, November 12, 2008, 8:00 a.m. - 11:30 a.m., Hyatt Vineyard Creek Hotel & Spa, Santa Rosa

E-Mail Express

Name:

Company:

E-mail:

Phone:

COMMERCIAL REAL ESTATE: Group buys Mervyn’s-anchored Napa center

SITE WILL BE STUDIED AS PART OF CITY’S REDEVELOPMENT PLAN

Parkway Plaza, a 77,000-square-foot strip mall in downtown Napa, anchored by a Mervyn’s department store, sold June 26 to a Santa Monica-based group of institutional investors for an undisclosed price.

The new ownership, called KLA Main LLC, purchased the property from the estate of Ed Keith and includes owners of Hayward-based Mervyn’s, such as Lubert-Adler of Santa Monica, according to the local agent of the new owners, Keith Rogal of Napa.

Mr. Rogal led the redevelopment of a mobile-home park on Highway 121 into the upscale Carneros Inn and brought together an investment group called Napa Redevelopment Partners to plan a mixed-use makeover of the 152-acre Napa Pipe plant site south of Napa.

For the Parkway deal, he worked with two changes in ownership in recent years to acquire the retail property plus the accompanying long-term leases.

“It seemed to me, in the five years I’ve been looking at the property, that there has got to be something from an urban planning standpoint that is more attractive than surface parking lots,” Mr. Rogal said.

What that “something” is will depend on economically feasible recommendations resulting from a pending city effort to craft a new downtown specific plan to guide redevelopment, according to Mr. Rogal. The city owns the parking lot adjacent to Mervyn’s and the other shops in Parkway.

Other properties around First and Main streets, such as the new opera house across from Parkway Plaza, were renovated. The shopping center’s parking lot detracts from the new streetscape along Main, according to Mr. Rogal. “It’s like a house with one wall knocked down,” he said.

***

The Wiseman Co. of Suisun City leased 3,000 square feet to professional services firms and is in the final stages of bringing in a second restaurant for the 40,000-square-foot Main Street West mixed-use development finished early this year at 1250 Main St. in Napa.

Constance Coughlan's CPA consulting firm leased 1,000 square feet on the second floor. The firm specializes in wine, real estate, construction, nonprofits and local government. It is set to move shortly from 525 Lincoln Ave. in Napa.

Two attorneys, Joyce Elliott and Jeffrey Hammond, leased 2,000 square feet on the second floor of Main Street West. She has practiced family law for nearly two decades, and he handles family law and criminal cases. Ms. Elliott has been in an office at 816 Brown St., which is undergoing renovations, for six years. The four-person firm plans to move Aug. 1.

“It’s great there’s new construction in Napa,” Ms. Elliott said. “We’ve been needing new commercial space in downtown for some time.”

Indeed, several downtown Napa mixed-use projects with office space are under construction or just finished. Besides Main Street West, Rossi Development of Napa finished The Zeller Building at 1315 First St. earlier this year. CDI Development & Realty of Napa is expected to finish its Napa Square office-retail redevelopment late this year. Channel Properties of Richmond is set to wrap The Riverfront residential-office-retail project next year.

The Wiseman Co. has 5,000 square feet of office space to lease on the second floor and about as much retail space to fill on the first floor, according to Scott Hunter, who is marketing the property and is also a project investor. Other tenants are AUL Corp. and the California Rehabilitation Department.

An executive suites company from outside the area is interested in the remaining office space, according to Mr. Hunter. A spa and a bicycle shop are in final negotiations for the retail space. The Wiseman Co. is in final talks on a lease deal for a 2,700-square-foot restaurant also on the first floor. Azzurro Pizzeria & Enoteca opened late last year at Main Street West and has generated several tenant leads, according to Mr. Hunter.

•••

Submit items for this column to Jeff Quackenbush at 707-579-2900 ext. 206, jquackenbush@busjrnl.com or fax 707-579-8475.