Wednesday, January 04, 2006

Booms and Busts Mark Business Year

Booms and Busts Mark Business Year
Development, closures haunt 2005

By Amanda Janis/Business Writer

Vacaville celebrated the opening of Town Square in downtown this year. (Brad Zweerink/The Reporter)

A look at this year's preeminent local business stories makes plain that Vacaville and its environs have moved far beyond the literal translation of the city's Spanish name. Once a true "cow town," the city, along with many of its Solano County neighbors, has become a distinguished host to major business and enterprise concerns.

The following is a synopsis of the top 10 business stories of 2005, as decided upon by The Reporter's editors. 1. Nut Tree Renaissance

The Power family's physical mark on Vacaville began to fade this year. Both of the family's renowned ventures - the Nut Tree and the Coffee Tree restaurant - underwent substantial change in recent weeks, causing both local institutions to fade a little further into Vacaville's past.

It's been nearly 10 years since the closure of the Nut Tree, which was a Vacaville icon for eight decades. Redevelopment of the historic site - which, all told, will cost more than $100 million - began to be visible this winter, with the raising of walls for the new retail component, and initial work on the related infrastructure project, which in itself is valued at approximately $25 million.

Plans to redevelop the 76-acre site by Larkspur-based Snell & Co. and San Francisco-based WesTrust include the creation of 330,000 square feet of office, restaurant and retail space, with confirmed tenants including Best Buy, Borders, Sports Chalet, and Pet-Smart. Also incorporated will be a 37-acre family park, which will feature a train ride in tribute to the train at the original Nut Tree.

Those involved with the project intend for the new Nut Tree to become a landmark in its own right. The new complex is expected to generate more than 1,000 jobs and to be a major source of sales and property tax revenue.

The Coffee Tree restaurant - which was opened by the family in 1965 as a casual cousin to the Nut Tree restaurant - closed more than two years ago, but was just recently razed. The Coffee Tree site is effectively the last available, developable parcel on Nut Tree Road, and its developers are in discussions with possible tenants. 2. Large Scale Biology Corp. Ceases Operations

The revamp of the historic Nut Tree site heads the list of top Solano business stories of 2005. (Rick Roach/The Reporter)

Vacaville's "biotech corridor" lost its only homespun member little more than a week ago, when Large Scale Biology Corp. ceased operations and terminated all 78 of its employees - 55 of whom worked at its Vacaville facility - just days before Christmas.

Citing a lack of sufficient cash and assets, and the inability to secure product collaborations or partnering initiatives with potential acquirers or licensees, LSBC abruptly announced its closure on Dec. 22.

While the announcement shocked and surprised many of its employees - some of whom said they weren't paid for their work in December - the company's financial woes were certainly public knowledge.

LSBC's Nov. 18 Securities and Exchange Commission filing expressed serious doubt about its ability to continue operations, disclosing a cash balance of $85,000 as of Sept. 30, and a net operating loss of $7.4 million for the same period.

Additionally, the Nasdaq Capital Market had announced a decision to delist LSBC stock at the start of trading on Dec. 27; trading of its stock was halted after the closure announcement on Dec. 22 and trading ceased altogether by the close of business the following day.

LSBC was founded in 1987 to market proteomic and genomic technology. It later moved into the development and production of tobacco plant-based therapeutic proteins and vaccines for diseases including non-Hodgkins lymphoma.

According to co-founder and CEO Robert Erwin's remarks in a 2002 BBC documentary, the company felt confident it would market the world's first customized treatments for individual patients by 2007. 3. Dixon Downs Gains Momentum

Whether or not a starting gun may soon sound in Dixon has tempers and tensions raised. The past year saw environmental impact reports and supplemental studies completed and released for the proposed thoroughbred horse racing track and adjacent retail complex, dubbed Dixon Downs.

The 260-acre, two-phase project proposed by Magna Entertainment Corp. will soon fall before the planning commission and subsequently the city council, with decisions expected by summer.

The proposed home of Dixon Downs underwent environmental assessment in 2005. (Rick Roach/The Reporter)

Supporters of the project point to job creation, tax revenue, and the advent of a "destination" landmark as reasons why Dixon Downs should be approved, while opposers - which include the Dixon Citizens For Quality Growth group - encourage its rejection, citing factors including excessive strain on the city's traffic, air-quality levels, and utilities. 4. BC Stocking Distributing Sells

After 44 years as a family-run, Vacaville-based business, petroleum distribution company BC Stocking sold the last of its interests in April.

A major distributor for Chevron in Northern California, BC Stocking was effectively sold in several transactions between 2004 and 2005. The company's holdings - which the firm has said netted approximately $90 million in annual sales - included businesses located in the Sacramento Valley, Winters and Richmond, as well as a contract with Chevron for lubricant motor oil.

The firm was founded in 1961 by Joe and Beverly Stocking; it was later run by their children, Bryant and Curtis, who are the owners of Vacaville's Travis Credit Union Park. Both sons have subsequently begun careers in real estate with Showcase Properties. 5. Alza Upgrades Facilities

Vacaville's largest private employer, Alza Corp., invested approximately $100 million this year in various upgrades to its state-of-the-art Vacaville facility north of Vaca Valley Parkway.

The upgrades equate to new tax revenue for the city, as well as a deepening of roots in Vacaville's promising "biotech corridor."

In excess of 1,000 employees work at Alza's local "clean manufacturing facility," a large scale plant with minimal (controlled) levels of environmental pollutants such as dust or vapors, so as not to taint the products being manufactured.

Alza - which develops drug delivery systems as well as pharmaceuticals including Concerta and Nicoderm CQ - was founded in 1968, and opened its Vacaville facility in 1986.

The company was acquired by Johnson & Johnson in 2001 for $10.5 billion. 6. Genentech Expansion Continues

Vacaville's business of the year, as awarded by the city's chamber of commerce, continued with construction at its 97-acre Vaca Valley Parkway site.

Genentech's expansion - valued at approximately $600 million - began last year, and will nearly double its existing 427,000 square foot facility. Its ground breaking ceremony last spring starred Gov. Arnold Schwarzenegger, who remarked, "Genentech will build the future right here in our Golden State. California will be known as the No. 1 biotechnology leader in the world."

The "Cell Culture Production 2" expansion project entails plans to add three buildings totaling approximately 380,000 square feet, and the company intends to substantially increase its work force in Vacaville from 800 to approximately 1,300.

Genentech opened its Vacaville manufacturing site in 1994, initially investing $300 million. The company develops and manufacturers biotherapuetics for unmet medical needs. 7. Downtown Vacaville Revitalized

Roughly $10 million-worth of development, redevelopment and general improvements came to fruition during the past year in downtown Vacaville.

A new 15,000-square-foot library opened in January, adjacent to a new parking lot and the new 15,000 square foot Town Square plaza, on which construction was officially completed in May. The plaza features a 39-foot clock tower, a stage, trees and a creek-like water component; it will soon add a fountain featuring a boulder, as well as grass and benches.

There were also some significant changes to downtown businesses, such as the opening of specialty shops like Spin a Yarn, and restaurants and cafes including the Pure Grain Bakery, Saltato's Restaurant, Rock N Roll Sushi, and Creekside Cafe, which replaced the failed Fire Falls restaurant and lounge.

Downtown's first mixed-use residential and retail space opened in the form of the Dionicia building, which houses the family-run Vasquez Deli on its ground floor, and several apartments and an office on the floor above. The mixed-use building on East Main Street - which in essence serves to extend the downtown area - is an example of what city planners and councilmembers see as a means to augment downtown's revitalization. 8. Yardbirds Sells to The Home Depot

Petaluma-based Yardbirds Home Center announced in December its sale to big-box retail giant The Home Depot for an undisclosed amount.

The sale ends a 30-year history of independence for the family-run hardware store, which was founded in Santa Rosa by John Headley.

Headley, who is in his 70s, remarked in a statement that the decision was made after much deliberation, and expressed his excitement over the prospect of working with Home Depot leadership to integrate the two companies.

At the time of the sale, Yardbirds owned and operated nine stores in four Northern California counties, and employed 650 people. Home Depot has confirmed that employees will not be laid off, nor will stores be liquidated.

While many Vacaville residents and Yardbirds shoppers expressed disappointment about the sale, company sources said the plan is for the local store to undergo a slight name change but otherwise remain the same. 9. Wal-Mart Quietly Supersizes in Dixon

Dixon's Wal-Mart completed a seven-month, 72,000 square foot expansion in November, making it the first Wal-Mart Supercenter in Solano County.

The 4-acre Supercenter opened amid few protests, despite the controversy that's embroiled similar Supercenter proposals in Solano County and across the nation.

A Supercenter is currently under construction in American Canyon, and the retail chain has plans to build Supercenters in Fairfield, Suisun City and Vallejo. 10. Milk-Farm Moves Along

Proposals to redevelop the historic Milk Farm seemed to be gaining ground in 2005, after nearly eight years of conceptual limbo.

Businessman and inventor Paul Moller has yet to produce firm development plans, but his concepts for redevelopment of the 60-acre site include a specialty retail element, an alternative health center, and a facility for Moller's research on flying cars. All these components - and perhaps even a hotel - would likely border a 5-acre lake, which would in turn be surrounded by preserved agricultural land.

An environmental impact review for his conceptual plans was certified this year, and the Dixon City Council's actions included pre-zoning, amendment of the city's general plan to reconfigure the site's zoning, and an annexation request to the Local Agency Formation Commission.

The Milk Farm's origins date to 1919, when it was originally a ranch near Currey Road run by Karl Hess. Hess relocated to its current location in 1939, and during the Depression, he offered visitors all-you-can-drink milk for ten cents, as well as inexpensive chicken dinners and pony rides. The ranch earned its nickname when it was subsequently featured the following year in The Saturday Evening Post, and over the years, its restaurant and gas station was immensely popular among travelers and local teenagers alike. Dairy operations ceased after World War II, and the Milk Farm closed completely in the 1980s.

Staff writers David Henson and Tom Hall contributed to this article. Amanda Janis can be reached at

* * * *

Top Ten Local Business Stories of 2005

1. Nut Tree Renaissance

2. Large Scale Biology Corp. Ceases Operations

3. Dixon Downs Gains Momentum

4. BC Stocking Distributing Sells

5. Alza Upgrades Facilities

6. Genentech Continues Expansion

7. Downtown Vacaville Revitalized

8. Yardbirds Sells to the Home Depot

9. Wal-Mart Quietly Supersizes in Dixon

10. Milk Farm Proposal Moves Along

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