Uniroyal Plant to Become Mall, Hotel : Redevelopment: Agreement calls for Commerce to keep title to the landmark property and lease it to the builder-operator.

The abandoned Uniroyal plant, a Santa Ana Freeway landmark that was built to resemble an Assyrian palace, will be redeveloped into a mall, hotel and office complex under an agreement approved by the City Council earlier this week.

The city Redevelopment Agency will retain ownership of the 35-acre site and lease it to Trammell Crow Co. under the agreement approved Tuesday.

The development, dubbed “The Citadel,” is expected to funnel more than $500 million in lease revenue to the Redevelopment Agency over the next six decades, said Justine McCarthy, deputy director of redevelopment. That revenue could be used to fund other redevelopment projects or to pay for public improvements such as widening roads.

The project also is expected to generate $250,000 to $350,000 a year in additional sales tax revenue for the city and to create about 2,000 jobs, McCarthy said.

The agreement requires Trammell Crow to renovate the former tire plant’s six-story office tower and to preserve all but 150 feet of its distinctive 1,700-foot wall fronting the Santa Ana Freeway. The 150-foot section will be removed to create an entrance to the complex.

“It represents a secure future for the city of Commerce, knowing this money will come in every year to help the city,” Mayor Ruth R. Aldaco said after Tuesday’s unanimous vote.

The lease agreement results from more than two years of negotiations between the city and Trammell Crow, which originally wanted to buy the site.

Trammell Crow plans to build a retail mall, five office buildings with more than 378,000 square feet of space, and a 201-room hotel on the site. The architecture of the new buildings is to blend in with the existing facade. Ground-breaking will take place within two months, said Trammell Crow partner Kevin J. Staley. The mall section of the development should be ready for business in late 1990, he said. The lease agreement requires Trammell Crow to complete most of the development within seven years.

Commerce will have invested about $22.6 million in the site by the time The Citadel opens for business, McCarthy said.

Commerce bought the Uniroyal property from fireworks magnate and convicted political corrupter W. Patrick Moriarty for $14 million in 1983. The plant, which was built in 1929 by rubber magnate Adolph Schliecher, was closed in 1978.

The city also has paid $5.5 million in interest on the property, McCarthy said. The city is spending about $2.24 million to remove underground storage tanks and to clean soil contaminated with oil and diesel fuel, McCarthy said. Preliminary test results indicate there is no contamination of ground water at the site, McCarthy said.

The city’s lease agreement with Trammell Crow is for 65 years with an optional 35-year extension.

The lease agreement includes a graduated schedule that requires Trammell Crow to pay the Redevelopment Agency $100,000 the first year. The lease payments will jump to $1.08 million by the seventh year. After the 11th year, increases in the lease payments will be based on the consumer price index.

An environmental impact study of the project identified two significant negative effects--more air pollution and the loss of part of the distinctive wall.

The air pollution will be generated from an estimated 19,000 trips a day to the complex by cars, buses and other vehicles, according to the environmental impact report.

Removing the section of wall probably will render the old tire plant ineligible for placement on the National Register of Historic Places, the report said.

Commerce officials, who planned to develop the site, never asked that the building be included on the National Register. There are restrictions against altering a building on the register.

But McCarthy said the lease agreement prohibits Trammell Crow from removing any more of the wall than now planned.

The City Council found that the benefits of the project, including the revenue for the city and the jobs it will create, outweighed the negative impacts.

“It’s going to be wonderful to see those buildings up when you drive by on the freeway,” Aldaco said.