The Manchester Financial Group has entered into a landmark 99-year lease with the Navy for the $1.2 billion redevelopment of the Navy Broadway Complex in downtown San Diego.
If the agreement had not been signed by Jan. 1, the federal government could have closed the complex, which is located on a prime 14.7-acre site at Broadway and North Harbor Drive.
Under the deal that was set to be announced Dec. 1, the Manchester group will assume development rights in a master plan previously negotiated between the Navy and San Diego.
Manchester will give the Navy $160 million, to apply to new headquarters on the site. Manchester is also covering costs associated with demolition and environmental remediation, according to Perry Dealy, an executive with Manchester.
The project has been plagued with delays ever since Manchester was tapped March 31 to redevelop the site, which now will be called Pacific Gateway.
The Centre City Development Corp., which oversees downtown building projects, had raised a number of concerns about what would be built at the site.
In an interview published last month, Dealy shared his frustration over the repeated delays, saying, “We’re trying to get a baseline from which to work from.”
A Work In Progress
The ground lease with the Navy, officially signed Nov. 29, takes some heat off Manchester, but doesn’t guarantee smooth sailing. The developer still has hurdles to jump.
“We are in the process of resubmitting an updated master plan,” said Dealy in a Nov. 30 interview, “along with improving the architecture of the buildings.”
Dealy expects to have the updated plans ready to submit to the CCDC before an urban design workshop set for Dec. 8.
Beyond that, the City Council is expected to consider environmental issues associated with the project, probably by the first of the year. The California Coastal Commission also must review the project.
Absent legal challenges, Dealy said that he expected work to get under way by year-end 2007.
In addition to the new Navy building, plans call for office and retail space, plus hotels and public attractions, such as a museum. The project will also include 3,000 underground parking spaces, and more than 5 acres of open space.
Manchester’s development must follow the general guidelines established in the city’s North Embarcadero Visionary Plan.
The news was a relief to Julie Meier Wright, president and chief executive officer of the San Diego Regional Economic Development Corp., which helps businesses expand and relocate to the region.
Wright has been a longtime advocate of keeping the property from being reclaimed by the federal government, which she said would have set the North Embarcadero plan back two years or longer.
“I am really pleased,” she said, when given the news. “This will address the Navy’s need for new facilities, and clean up a long-blighted piece of property.”