Tuesday, October 10, 2006

Lennar, Touro to Discuss Future of M. Island

Lennar, Touro to Discuss Future of M. Island
By CHRIS G. DENINA, Times-Herald staff writer

An artist's rendering of Lennar's tentative proposal for the development of Mare Island's north end. Photo: Courtesy Lennar Mare Island LLC

Vallejo's had bad luck finding a developer able to inject some life into Mare Island's north end, once home to an old gas station, supermarket and department store.

Now, the city has two groups vying to rejuvenate the 191 acres.

Today, the Vallejo City Council is slated to discuss how to approach the conundrum of appeasing two groups both key to Mare Island's future.

On one side, Lennar Mare Island LLC already is developing 650 acres and wants to extend its reach to the north end. Meanwhile, Touro University, a major tenant on the former base, wants to create a university village with its own development team.

Both sides said they plan to meet today, before the council session, to discuss their plans.

"Any delay on the north island that is caused by the introduction of a new party or alternate developer would be to the extreme detriment of island-wide progress," Lennar spokesman Jason Keadjian said Tuesday.

Touro is hopeful it can work with Lennar, said Richard Hassel, Touro vice president of administration.

"I don't see competition here at all," Hassel said. "Lennar is a home builder. We are a university. We would like to create a university village."

The Vallejo City Council is being asked to approve a deal to negotiate with only Lennar Mare Island for the renewal of Mare Island's north end. Lennar's exclusive right to iron out an agreement expired in April.

The council's alternatives include sitting on the property until the real estate market improves, seeking new pitches from other developers or considering unsolicited proposals that have flowed in since Lennar's exclusive negotiations period ended.

Lennar's proposal includes developing office, retail, residential and industrial uses. The firm has sought to develop Mare Island's north end, which impacts Lennar's development on the former shipyard's east side. That includes housing and offices.

Lennar already has invested tens of millions of dollars into island-wide infrastructure improvements.

"Ironically, what Touro is proposing is not so dissimilar from what Lennar has proposed in the past," Keadjian said, noting Touro's university village idea.

Touro's plans include a research park, shopping area and community cultural center.

"Our intent is to work with the development team as a team on the whole of Mare Island," Hassel said recently. "We feel that we're bringing some resources to the table that are going to beneficial to the entire island."

Touro is seeking to work with Lennar on issues including the cleanup of the former Navy base and the Navy transferring ownership of the property so it can be developed.

"There currently is not an exclusive right to negotiation in effect," Hassel said. "And we're just asking the city consider Touro as a resource of the community."

Two other groups have failed to redevelop Mare Island's north end.

The team of Weston Solutions Inc. and Harvest Properties withdrew from the project in 2004, citing issues including Mare Island's aging infrastructure and the city's requirement of putting up more than $2.5 million in earnest money.

Before that, Legacy Partners Commercial Inc. backed out because of a dispute over district taxes.

"Lennar Mare Island has already made substantial progress related to the future development of the north island," Lennar's Keadjian said. "And the reuse cannot afford another restart on the north island."

Whoever is given the rights to Mare Island's north end will have to reach a deal with the city on matters including a price for the property and a plan for upgrading the infrastructure and developing the land. For instance, the Highway 37 interchange at Mare Island's north entrance requires major improvements

E-mail Chris G. Denina at cdenina@thnewsnet.com or call 553-6835.

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