Looking for a Square Deal
Once the site of Sacramento’s most ambitious building project, 301 Capitol Mall may be in play again. But will it rise to the occasion? Here’s why CalPERS holds the future of our grandest boulevard in its hands.
The footprints of the Towers project are still visible on Capitol Mall.
Photo By Todd Quam/Digital Sky Aerial imaging
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GGood things are happening downtown these days. Plans for the new arena and surrounding
Downtown Plaza are picking up speed. Local entrepreneurs are lining up to open exciting new restaurants and other entertainment venues in long vacant storefronts on K Street. There’s talk of new bridges over the Sacramento River and even a streetcar system.
But as plans for the central city coalesce and as the economy continues to rebound, the fate of the 300 block of Capitol Mall—the single most prominent undeveloped block in the entire region—has the potential to shape the city’s future as much as any other piece of real estate in town.
If you think that’s an overstatement, just consider its placement, its history and its current owner.
Situated on Capitol Mall between 3rd and 4th streets, the site was for decades the headquarters of the now defunct Sacramento Union. But today it’s better known as the block where Sacramento developer John Saca boldly proposed two 53-story condo towers that would have become the tallest residential structures on the West Coast. The plans included a luxury InterContinental Hotel in one of the towers and high-end retail on the ground floors. It would have been a game changer for Sacramento.
In 2006, about 2,000 concrete piles were pounded into the ground to anchor the 615-foot-tall buildings. Had the project been realized, it would have flooded downtown with thousands of new residents. With so many well-heeled condo dwellers and visitors nearby, it’s likely that Westfield—one of the world’s largest mall companies—would have invested heavily in Downtown Plaza. Once the project died, however, Westfield poured $240 million into its Roseville location, eventually selling Downtown Plaza.
And Capitol Mall—today a virtual ghost town after-hours because of the density of private and government office buildings, and lack of retail and residential properties—could have attracted other projects that would have breathed new life into a potentially grand boulevard.
As Saca was struggling to pull together the financing, the Sacramento-based California Public Employees’ Retirement System (CalPERS)—the largest public pension fund in the nation, then managing a $207 billion portfolio—came to the rescue with a $100 million investment, its single biggest financial commitment ever in the state capital, with the exception of its own $110 million headquarters on Q Street and a $265 million expansion that opened in 2005.
Then the housing market crashed, followed rapidly by the rest of the economy. Sacramento’s brashest real estate project was dead on arrival.
But even after the project was abandoned, there was one ray of hope for the future of the site.
When the project went belly-up, CalPERS acquired the parcel and publicly vowed to pursue a signature project worthy of its prominent location once the dark economic clouds parted. As one of the fund’s spokesmen told KCRA in 2007: “We’re going to work … to make sure we can develop something that’s iconic of nature that the city can embrace.”
CalPERS then contracted with the Los Angeles development firm CIM Group to plan a scaled-down version of the project. At the time, CIM principal John Given told The Sacramento Bee, “It is a very important location for Sacramento’s development. … We envision planning the site so that it can have an office building and a hotel-condo building.”
But several years later, CalPERS and CIM took another direction entirely, offering up the block as a site for a new county courthouse in 2010, a move that could have permanently crushed any hope of Capitol Mall becoming a vibrant boulevard with retail and residential components. A courthouse would have been another office building that closes at 5 p.m. and, perhaps worse, would have attracted dozens of bail bond storefronts to the center of three of the city’s biggest tourist attractions—the Crocker Art Museum, Old Sacramento and the Capitol—just like the constellation of bail bond businesses that surround the current courthouse. Fortunately, the project’s advisory group recommended the railyards as the future home of the courthouse, granting a virtual stay of execution to Capitol Mall’s chance at a brighter future.