CCDC Picks Crystal Galleria Over Second Developer for a New Broadway High-Rise

A downtown redevelopment committee--placed in the enviable and unaccustomed role of choosing between two major high-rise proposals on the same block--on Friday recommended Crystal Galleria, a spectacular $84-million pair of towers connected by a 400-foot, glass-domed atrium along Broadway at Kettner Boulevard.

The recommendation made by a Centre City Development Corp. committee must now be endorsed by the full CCDC board at its meeting Oct. 30, and later by the City Council.

But unless discussions between that developer--a consortium of local and national companies--and the CCDC staff led by top administrator Gerald Trimble bog down as they clarify key financial and other points, it seems unlikely that the second proposal has much of a chance.

That proposal, put together by Starboard Development Corp., a local company best known for pioneering the use of private financing to build public buildings, involves the construction of a 22-story office tower and an 18-story, 308-room hotel.

G. Bradford Saunders, Starboard president, said his company will make a presentation to the CCDC board on Oct. 30 in an attempt to try to have the committee’s recommendation reversed.

The irony is that both projects are basically acceptable to CCDC. As recently as a year ago, Starboard might not have faced any competition, might have won the immediate and hearty endorsement of a development-hungry CCDC.

But now there is an explosion of interest in downtown development, including four major projects planned within walking distance of the site the Crystal Galleria consortium wants to develop. Faced with stiff competition, the Starboard proposal came in second.

“We liked the strength of the partnership,” said Tom Carter, chairman of the three-member CCDC board of directors committee that evaluated the two proposals, in explaining the basis for the committee’s recommendation. Without being specific, Carter said the Crystal Galleria consortium proposed better financial terms to CCDC than did Starboard.

“Crystal Galleria was a little more exciting,” said Carter, a residential developer.

Carter emphasized, however, that if the consortium and Trimble fail to agree upon the general outline of the business conditions, he would have no trouble recommending Starboard.

“Both projects were very good and we’d be excited to have them both downtown,” said Phil Blair, also a member of the committee. As for the Crystal Galleria developers, Blair said that “the loose ends of (their proposal) seemed to be more tied down and they are more experienced developers.”

This is the first time CCDC has had to choose between two major projects with ownership interest on the same property. Usually, there is a single property owner who proposes a development, or several developers are asked by the agency to bid on a project with the expectation that CCDC will acquire the necessary land.

In this case, Starboard announced its plans for a two-block project--bounded by Broadway, B, Kettner and India streets--in June. Starboard unveiled its plans because it holds an option to buy half of the land involving its project.

By law, CCDC was required to give property owners on the two blocks the opportunity to come up with their own proposal.

On Sept. 2, developers of Crystal Galleria responded publicly by announcing their plans for one of the two blocks bounded by Broadway, Kettner, India and C streets, setting off the unusual competition.

The Crystal Galleria consortium consists of Cethron Inc., a small family-owned company that controls about half of the block; the Bowlen Group, a large development company whose real estate arm is based in San Diego and which developed the First Interstate Plaza downtown, and the Mellon Stuart Co., a Pittsburgh-based firm that would be the general contractor for the project.

The proposal calls for a 24-story, 459,000-square-foot mixed-use building made up primarily of offices, followed by retail stores, a tower restaurant or private club, underground parking and at least six 3,600-square-foot condominiums on the top two floors that would sell in the “$1-million-plus” category. It does not, however, contain a hotel.

Perhaps the most fetching aspect of both the Crystal Galleria and Starboard proposals was the incorporation of a station for the San Diego Trolley’s Bayside Line extension through downtown, connecting the center city with the bayfront and convention center. The station and trolley tracks would run through the middle of the Crystal Galleria, crowned by the 400-foot-tall glass-domed atrium.

The Metropolitan Transit Development Board, which favors cutting the trolley tracks diagonally through the block, wants to have its new Bayside Line in service by 1989, which both developers say they could manage even though their buildings wouldn’t be finished by then.

Tom Larwin, MTDB general manager, says his agency has reviewed both projects and finds them both good. “They both seem willing to give us everything we need for our station and track,” said Larwin, who in the past has said integrating a galleria atmosphere into a trolley station would be nearly impossible for MTDB to handle with its own finances.

MTDB, which has budgeted about $6 million to acquire right-of-way along the entire Bayside Line, has yet to negotiate with any of the developers over the cost of the right-of-way through the block.

“I’m glad it’s a decision (selecting between the two developers) I didn’t have to make,” said Larwin, noting that Starboard is the company building the agency’s new headquarters and that the Bowlen Group came in second place in that bidding. “I think it would be hard to pick one over the other. Both are very capable.”