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City buys historic downtown homes for $3.4 million

 

In hopes of building something grand in the future, the Mountain View City Council swiftly put up $3.4 million to acquire a trio of downtown houses.

The property purchased by the city is located at 996 Dana St. and includes three old houses that city officials expect to rent out to tenants while they figure out what to do with the site. Dennis Drennan, city real estate manager, said that the Dana Street property is well located for some kind of future development because it is right next to a city-owned parking lot along Villa and Franklin streets. When the city is ready to redevelop the parking lot, the newly acquired property can be paired with it to build an even larger project encompassing 1.5 acres, he said.

"We're not asking for action right now on how we're going to use this property," Drennan said. "We have to do an assessment and come up with various alternatives, and then we'll come back to council at a later date."

In recent years, Mountain View officials have pushed to redevelop some downtown parking lots for housing and commercial growth. Last year, the city approved plans to build a five-story hotel and office complex with an underground parking garage, to replace two parking lots on Hope Street. Likewise, an affordable housing project is expected to eventually be built at another public lot at the corner of Bryant and California streets.

For the 996 Dana St. site, city staff members say they had to move quickly to buy the property before other buyers could swoop in. The property was originally listed for $2.9 million, but city officials decided to offer $2.93 million to be more competitive. The total cost increased to $3.4 million when including title and escrow fees, repairs and relocation expenses for existing tenants, and a 5% city administrative surcharge for capital improvement projects, according to the city staff report.

The three homes at the Dana Street property include a three-bedroom house and two smaller, one-bedroom units. The houses are more than 100 years old and listed as state historic resources. City staff acknowledged the age of the buildings will likely mean the city will need to do repairs and possibly pest control. They noted the historic status could complicate future development opportunities. But overall, staff recommended buying the property.

The city will pay the $3.4 million from its new Strategic Property Acquisition Reserve (SPAR), a special account set up by the city specifically to quickly move on available real estate opportunities. The SPAR account currently has $9.7 million.

"This is a perfect example of what we have the (SPAR) fund," Councilman John McAlister said before voting at the May 21 meeting. "This is why is important to maintain that fund so we can jump on things like this."

The purchase was unanimously approved by the City Council.

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Comments

10 people like this
Posted by Dan Waylonis
a resident of Jackson Park
on Jun 10, 2019 at 3:17 pm

Dan Waylonis is a registered user.

The city is now competing with individuals for real estate? And paying over asking?


3 people like this
Posted by Robyn
a resident of another community
on Jun 11, 2019 at 8:06 am

Wow! That is a lot of taxpayers' money.
What is the 5% city administrative charge for capital improvements? To whom does that go? Or is the city charging/paying itself?


Sorry, but further commenting on this topic has been closed.

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