Plans to turn the former Rockhaven Sanitarium in north Glendale into a park and boutique-commercial center have been scrapped, with city officials recently severing ties with the local developer heading up the project.
Following closed-session deliberations on Feb. 5, City Council members decided not to extend a contract with Gangi Development that was first initiated at the end of January 2017, city spokesman Dan Bell confirmed on Tuesday.
“We’ve been at it for years,” Bell said. “Both sides could not come together on a project, so we’re moving on.”
The council’s decision disheartened Matthew Gangi, the project’s principal lead, who said he still hasn’t given up on the vision the council approved in November 2016.
“We showed them it could work,” Gangi said. “It just seems like they have other plans.”
In a letter dated Feb. 7 to Frank Gangi, the company’s president and Matthew’s brother, Philip Lanzafame, Glendale’s community development director, expressed otherwise, writing that the city determined “there is not a viable path” forward.
“While there are several items that either have not been addressed or remain hurdles, Gangi Development’s unwillingness to provide a guarantee of project completion and its additional subsidy requests, in particular, are obstacles too significant to overcome,” Lanzafame wrote in the letter obtained by the Glendale News-Press.
According to Matthew Gangi, the city had asked him and his family associates to personally guarantee yet-unspecified improvement requests to the site, which some family members would not do because they felt they were already offering substantial money and effort to improve the city-owned property, Gangi said.
The subsidy request was for the the city to waive park and development-impact fees “to show the city was also supportive of a community project,” Matthew Gangi said, adding that city officials balked at the idea.
Under the original proposal, businesses and nonprofits would have moved into the former sanitarium’s 14 buildings that Gangi Development had planned to rehabilitate.
Prospective tenants included a farm-to-table restaurant, a sustainable winery, a hatha yoga studio, creative lounge and native-plant-seed shop, Matthew Gangi said.
Remaining space on the property that’s been designated a historic district would have become a park, with a planned performance stage and several demonstration gardens, he added.
The roster of businesses was selected, in part, as an homage to the property’s original incarnation when it opened in 1923 as a progressive women’s mental-health facility, according to Matthew Gangi.
The sanatorium, founded by nurse Agnes Richards, has also come to be associated with some of its former celebrity clientele, including Marilyn Monroe’s mother, Gladys Eley.
A financial analysis summary from the 2016 proposal pegged the cost of opening the park at $4.8 million, a figure that included rehabilitation of the historic property, as well as adding parking and landscaping.
The analysis anticipated the city would receive $50,000 a year, generated from roughly $5 million in annual taxable sales.
The Gangi project was supported by Friends of Rockhaven, a nonprofit dedicated to preserving the property.
“Naturally, we’re devastated,” said Joanna Linkchorst, president of Friends of Rockhaven. “We’d hoped we had found the solution. We thought that finding someone who would [handle the project] privately, that the city would be willing to have a park there — a remarkable park.”
Speaking for the nonprofit, Linkchorst said the organization is convinced the city will now attempt to sell off the 3.5-acre property it purchased for $8.25 million in 2008.
Bell said the city is weighing its options.
“We don’t have anyone in mind [to head a new project],” Bell said. “We’re going to go back and reassess everything.”
When the city first approved the Gangi project, it had sidestepped staff’s recommendation to instead green-light a 45-room hotel with amenities pitched by Avalon Investment Co. on the site.
In July 2017, Gangi Development requested a six-month extension of its contract and was given a year, according to Glendale’s former spokesman Tom Lorenz.
Last year, the contract was extended from July 31 to Nov. 30, Lorenz said in September, adding that the Gangi company was not meeting city staff’s deadlines. Following Nov. 30, Gangi was given two more short extensions, Bell said.
Matthew Gangi countered that his team has always met deadlines, but that the city often requested additional information following reports and studies that required extensions.