There is now no way Zeiden will wait around for this mess to be clean up now.
Unhappy K Street developer says he's ready for court fight
City is suing to try to force completion of a land swap seen as crucial to the future of troubled downtown area.
By Terri Hardy - Bee Staff Writer
Thursday, May 31, 2007
Moe Mohanna says he is a patient man.
The city is suing Mohanna, a downtown landowner, and his development team to force them to move forward with a land swap that will allow the transformation of K Street's most blighted blocks.
Mohanna isn't happy with the deal and said this week he is willing to battle the city for years in court and spend "up to $3 million" to get justice.
Hanging in the balance: one of downtown's most crucial redevelopment projects in an area Mayor Heather Fargo calls Sacramento's "ground zero."
City officials once had hoped that Joe Zeiden, the developer chosen to renovate the 700 block of K Street with thriving shops, would be finished by the holiday shopping season.
Mohanna is part of a development partnership tasked with bringing condos and retail to the 800 block of K Street. Under the deal, Zeiden would swap properties on the 800 block for Mohanna's properties on the 700 block. That way, Zeiden would control the 700 block of K Street, and Mohanna would control most of the 800 block.
Previously, Mohanna has said that banks have been unwilling to transfer $4 million in loans he has on property in the 700 block to the 800 block. Several buildings in the 800 block were demolished after a fire in November. Mohanna asked for more financial help, but no deal was reached, city officials said.
Mohanna said the effort is in limbo and all negotiations with the city have stopped.
"Now it's two or three years in court, of course," Mohanna said. "After 29 years of waiting and hard work, I'm entitled to the fruits of my labors. I can wait a little more."
John Dangberg, an assistant city manager, said talks with Mohanna's development team are ongoing and positive, including one meeting Wednesday.
Still, Dangberg acknowledged that much relies on a successful outcome. He said Zeiden still is committed, but also is concerned.
"Certainly he is frustrated, but he understands the circumstances we are in," Dangberg said. "When we come out of this whole process, I hope he will be there to partner with us."
The growing rancor between Mohanna and the city, along with a downtown business group, has only been exacerbated by the city's controversial push to move a light-rail station from the 700 block of K Street around the corner to Seventh Street, between J and K streets. Mohanna has been one of the chief critics of the action, claiming it is unnecessary.
Mohanna said the city made the proposal to appease retailer Zeiden, who owns the Z Gallerie furniture retail chain.
"The city needs to treat both developers the same -- one is no better than the other," Mohanna said Tuesday, after a City Council meeting. "I've been here for 30 years and the other (Zeiden) is a newcomer."
Zeiden supported the station move. In a May 22 letter to Fargo, Zeiden said "relocation is crucial to my ability to tenant the 700 block of K Street with high-end destination retail."
Zeiden said the station platform blocks the view line down K Street, including his buildings.
At Tuesday's council meeting, Fargo said that station relocation, along with other planned beautification projects for K Street, was approved to spur economic development in the area. Although a beautification plan will be designed for the entire K Street Mall, there's only enough money to make improvements on the 700 block.
"This is not about helping or harming one developer or another," Fargo said.
City officials said the relocation of the light-rail station would open up St. Rose of Lima, allowing patio seating and public events, as well as eliminating blight and increasing safety. They said that area has a problem with people loitering, particularly transients.
Because the area is a public gathering spot, city officials said, it's nearly impossible for police to cite anyone for loitering. Moving the station to Seventh Street, between K and L streets, will allow better police monitoring, said police Capt. Darrell Fong.
Fong and city leaders also dismissed concerns raised by the plan's critics that it would be problematic for the station to be closer to the Greyhound bus station and across the street from a liquor store, saying that both the station and the store eventually would be moved.
RT executive Beverly Scott said the new station location would allow RT to add a stop for outgoing riders on the Gold Line. Scott told the council that despite some rumors, it was a decision made willingly by her agency.
"RT is not being pressured," she said.
Transit rider groups and other critics spoke against the station move Tuesday, calling it a waste of taxpayer money.
Mohanna, a board member of the Downtown Sacramento Partnership, was upset by the organization's support of the light-rail move.
He hired an attorney, accused the organization of violating the state's open meeting laws when its executive board voted to support the station relocation, and asked it to change its position, said Michael Ault, executive director of the partnership.
Ault said the group followed all laws and provided information requested by Mohanna, but didn't change its position.
"We had to retain legal counsel to deal with this. It's very unfortunate," Ault said.
Ault said of even more concern is the lack of progress on the 700 and 800 blocks of K Street. Redevelopment of that area is pivotal to downtown revitalization, he said.
"We need success there, no question," Ault said. "Stalling, delaying and lengthy litigation means a big loss for this community."
http://www.sacbee.com/101/story/200390.html
dugsboat at 4:13 AM PST Thursday, May 31, 2007 wrote:
Downtown "revitalization"
Over 30 yrs ago Mo came to town and I was one of his bankers. This is a man that is a sraightshooter and honest. Unfortunately he has placed alll his nuts in one basket, and it looks the city is willing to bust his nuts. The city is being silly as every delay is just costing more and more development money. Settle with Mo and get on with the project. I have worked in downtown Sacramento for years as a banker and a stockbroker. It is a city that rolls up its sidewalks at night. Putting more citizens with higher incomes in the area is exactly the cure.
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PatThePI at 7:12 AM PST Thursday, May 31, 2007 wrote:
Thank you, Dougsboat
When I read these stories of "A" vs "B", and there is no background on either of them, it's hard to get a feeling for what the correct outcome should be. I find it helpful if folks with personal knowledge, step up and add their observations and opinions. It kinda helps to know who to root for, if you know what I mean. This problem on K St has plagued our city for long enough. I would like to see both blocks improved and it would not bother me in the least if the two primary landowners became fabulously wealthy from the process. Their success would only reflect the improvement to life and business in downtown Sacramento. In my opinion, the City is difficult to do business with and that is one reason I moved my business out of the city and into the county. Good luck to all, in this effort.
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jlspencer at 7:26 AM PST Thursday, May 31, 2007 wrote:
Root for Mo
Like dugsboat, I have met with Mo and he is a good, honest businessman. But let's look at the picture here. A person wants to swap a block of existing, leaseable buildings with a block of burned down and unsafe, shuttered buildings. Just on the surface, this is not a fair trade.
If they want to consider getting rid of blight on K Street, the City better look down the street more than just the 700 and 800 blocks. It goes all the way to 12th Street. Shifting the transients and hooligans one or two blocks down will not get rid of the blight.
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stevor at 7:29 AM PST Thursday, May 31, 2007 wrote:
Contributions rule?
I have to wonder if who Fargo is giving preferential treatment to is also the one who donated the most to the city council peoples' reelection.
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williaminsd at 7:39 AM PST Thursday, May 31, 2007 wrote:
Well dugsboat...
In the 30 years Mo has owned that section of K Street it has become among the most blighted, disgusting properties in all of downtown. He has had numerous opportunities to redevelop his prime real estate and, for a variety of reasons - some pretty dubious - he has chosen to remain what some might call a slum lord.
Who is holding whom hostage here? The city hasn't been perfect, but Mo has been a difficult to say the least. And judging by this article, being difficult is hard habit for him to break.
So here we are in 2007 with a real opportunity , some might say the best opportunity - at last - to make K Street a truly regional destination with the kind of retail everyone has dreamed of and what's hold us up? Just one person: Your "straight shooter," Moe Mohanna.
So while Moe throws his latest tantrum, his part of K Street remains a scar on Sacramento. Nice work!
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Alan Miller of the Train Riders Association of California (?) arguments were completely disingenuous because I know he doesn't care about the money. Oh my god soon people will actually have to walk a 1/2 block to the new station? How inconvenient! What a hardship!
Amen to both of the above. Sometimes it's hard not to laugh out loud at these clowns.
It'll be ironic cuz I'm really big on historical preservation. However, I don't see the value in 'living in the past'. I'm convinced that Sacramento had a vibrant downtown in the past. And I pretty much understand what happen. Alas Time marches on and nothing we say or do will turn back the clock. My 98 grandmother used to say to me that the "good old days" were not all that good. There were some 'bad old days" too but people chose not to remember those. There were big slum areas and 'hobo' camps but nobody talks about those.
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