$180-Million Project Across From Old Structure : Development Firm Proposes City Hall Complex

Times Staff Writer

A San Diego development company wants to build a $180-million City Hall complex across the street from the existing one.

The proposal by Oliver McMillan Inc. calls for construction of two high-rise towers encompassing about 1.2 million square feet, more than half--or about 750,000 square feet--of which would be used for the new City Hall. The rest would be leased to private businesses.

Construction of the complex, planning for which is still in the early stages, would occur on two blocks bounded by A and C streets and 3rd and 4th avenues. The project would be on both sides of B Street, becoming part of the burgeoning B Street corridor of high-rise office buildings.

"We've been watching downtown for a number of years and it's simply a time for us to take a serious look," said Morgan Dene Oliver, a partner and co-founder of the development firm. The Oliver McMillan company, which has developed more than 1 million square feet of office space and has nearly that much more under construction, has until recently focused its attention on the Golden Triangle and Mission Valley.

Last month, the company was selected by city redevelopment officials to build a four-story structure of apartments, offices, shops and restaurants in front of the Horton Plaza parking garage, making that its first formal foray into downtown.

Firm in Negotiations

But Oliver said Monday that the company has been interested in downtown for some time now. For more than a year, the firm has been in negotiations to build a high-rise office building on a single block across from City Hall. That block, bounded by A and B streets and 3th and 4th avenues, is owned by several property owners, though the largest chunk is controlled by Evan Jones, the operator of Ace Parking.

Jones also owns a "sizable" part of the second block--situated just south and across B Street--that's a part of the new City Hall proposal, according to Oliver.

That block, which includes the California Theater and several popular lunchtime restaurants, such as Tecate Sam's, Harb's Deli and Beefmasters, has been the focus of other development proposals in the past, but leases held by businesses on the block have stymied those efforts, he said.

Oliver said his company would attempt to incorporate the California Theater, one of the few remaining old theaters downtown, into its project if at all possible.

Until last summer, the company's only plan was to build a high-rise on the northern block, but the city's announcement that it was going to study its future office space needs changed that. It was then, Oliver said, that his company decided "we held a key to a very viable option." That option called for expanding the firm's development plans over to a second block and including offices for city government as the development's crucial component.

The city is in the midst of its office space needs study, but has estimated that it needs 700,000 square feet of space in the future. It already rents space in several office buildings near City Hall.

According to Oliver, the city manager's office has agreed to study the firm's proposal. Deputy City Manager Maureen Stapleton, who is in charge of the city's space needs study, was unavailable for comment. The city manager's office, however, is also looking at another plan being promoted by developer Ernest Hahn.

Hahn, who heads the city's Centre City Planning Committee, unveiled a plan last summer to move City Hall, the county government complex, the main city library and several Navy office buildings to a 12-acre site in the eastern part of downtown.

Oliver said his company's proposal--unlike the Hahn plan--would keep City Hall centrally located and in the midst of the central city.

The Oliver McMillan plan is still in such early stages that financing has yet to be determined. Oliver said there are several possibilities.

The city could sell or lease much of its property at the existing City Hall complex, using the money to help pay for the new City Hall complex. The city could also demolish its aging City Hall--which Oliver says is just a matter of time because the structure is outdated and obsolete--and use the property for additional expansion.

No Deadline Set

By combining both the company's proposal and land that would be made vacant if City Hall were demolished, Oliver says that as much as 4 million square feet of office space could be developed--including room for a new central library.

The company has not placed a deadline on when it needs a decision by the city, Oliver said. But should the city turn down the Oliver McMillan plan, the firm would still go ahead with its original proposal to build a high-rise building on a single block.

One attribute the firm has in its favor is that many of its projects have received awards for architectural excellence. Among those have been the La Jolla Bank & Trust Plaza, a $45-million structure in the Golden Triangle. In 1983, the local chapter of the American Institute of Architects recognized the company for its "very public concern for San Diego's building environment" and said that both Oliver and his partner, James L. McMillan, had consistently made a "personal contribution to the advocacy of high standards for the architectural profession."

Although there is no design for the new City Hall complex, Oliver said that whatever the company does, "it will be a signature building . . . you won't see us building a square box downtown or a square box with" peaks on the corners.

"It will be unique," he said.

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