Old Neighborhood; New Look

WAL completion a sign of development upswing on R Street

Back Web Only Jan 9, 2015 By Morris Newman

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Development activity on R Street has gained momentum, with at least six renovation projects taking place in formerly obsolete industrial buildings on the corridor between 11th and 20th streets. With the completion of projects like 116-unit Warehouse Artist Lofts, which opens this month near 11th and R streets, the formerly grungy corridor has become arguably the most active development area in downtown Sacramento, after the new Kings basketball arena and the Railyards housing-and-retail juggernaut.

The current surge of development activity on R Street is anything but a sudden fad, however. Public agencies, notably the Capitol Area Development Authority, have spent more than 20 years trying to stimulate redevelopment on R Street. The corridor is part of a 52-block special planning district of the City of Sacramento — of which 18 blocks overlap with CADA’s boundaries  — that surrounds the Capitol building to the east, south and west and has been a primary redevelopment target.

The completion of the $41.5 million WAL has had a catalytic effect on the corridor, boosting confidence in the commercial potential of the downtown corridor among developers, investors and  lenders, according to Todd Leon, R Street development manager for CADA. Other anchor projects on R Street include the Safeway shopping center at 20th Street, developed by Paul Petrovich, and the Ice Plant, a group of nine adjoining buildings, being reinvented by developer Mike Heller and land owner Mark Friedman..  

Heller has maintained a high profile on R Street in the last year, since announcing development plans for the old Crystal Ice. Heller’s vision includes the refurbishment of 82,000 square feet in three buildings—Ice Plants 1, 2, and 3 — into restaurants, offices and shops. Made of concrete and wood, those buildings have the kind of rough-hewn character that many other developers seek to create in newer buildings, according to Heller. He’s also an active buyer on R Street, last October having purchased, in partnership with Ridge Capital, the former Capitol Whole Electric building located directly across from the WAL.

Other R Street pioneers include Randy Paragary, who owns a restaurant and music venue complex at 15th Street, and Bay Miry, whose D&S Development built residential condos and retail development at 14th Street. Like Heller, Miry has multiple properties on R Street. The Sacramento-based investor has entered into a partnership with the Youssefi family, whose CFY Development built the WAL, to renovate the three-story Rochdale Building sandwiched between WAL and 11th Street. The partnership plans offices on upper stories and a restaurant at street level.  

Yet another developer with multiple R Street holdings is the Cordano Co., which is currently converting an aging industrial building on R and 15th  streets into a retail and restaurant complex. Last fall, Cordano expanded its presence on R Street with the purchase of a near 15,000-square-foot and mostly vacant space that houses New Helvetia Theatre at 11th and R streets. Located directly across 11th Street from WAL and the Miry-Youssefi commercial project, the building is now part of a row of renovated projects on a street formerly known for abandoned and under-used properties,

Public investment on R Street continues to make private investment attractive on the corridor. CADA has invested in street and sidewalk improvements in order to make the area attractive to pedestrians in search of historic atmosphere and industrial chic.

Editor’s Note:  The initial version of this article stated that Mike Heller, not Mark Friedman, owned the Ice Plant. It also mistakenly claimed that the Cordano Co. had purchased only New Helvetia Theatre, and not the entire space that houses the theater. It has since been edited for factual accuracy. 

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