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Strategic Economics, an urban economics consulting firm, on Wednesday outlined for city councilors the pros and cons of selling the midtown campus as opposed to making upgrades.

The first in a set of biweekly midtown campus updates Wednesday outlined potential timeline options for the development — including the pros and cons of selling the campus in its current state, compared to investing public dollars into the aging site over time.

“What we’re hearing is that the midtown asset today is a distressed asset,” Dena Belzer of Strategic Economics, an urban economics consulting firm, said during a presentation to the City Council.

Belzer noted that to reduce risk to a developer, fiscal investments in the site could be considered, including demolishing undesirable buildings, exploring zoning for desired land uses and and investing in infrastructure and site assessments.

“The more the city puts in, the more risk is reduced,” Belzer said.

Dallas-based KDC Real Estate Development & Investments/Cienda Partners — which was brought on by Team Midtown, a consortium of 17 local businesses and organizations — was slated to develop the property. But the company and city mutually terminated their contract last month.

KDC/Cienda identified a number of concerns about the onetime college campus, including issues with buildings, infrastructure problems and ongoing fiscal uncertainty tied to the coronavirus pandemic.

In a letter, KDC/Cienda wrote the buildings had “no commercial value.”

Belzer said the city could consider selling the property “as-is,” comparing the option to a garage sale, while noting the downside of the city being left with the least attractive parcels of the campus, and thus, losing control over future value creation at the site.

Belzer also said the city could make larger improvements over a six- to 12-month period to prepare the site for market, which would include demolishing or rehabbing older buildings, rezoning and establishing a financial structure for public financing, such as a municipal redevelopment area.

The longest-term option floated to the council was a gradual five-year disposition of the site, which Belzer said gives the city the most control over its future to meet previously noted community plans for the midtown campus.

“This might require additional resources from the city, but this also has the most potential for the city to participate in the economic value down the road,” Belzer said

Belzer added that during that period, previous applicants to the city’s request for expression of interest could be brought back into the fold.

Assistant City Attorney Andrea Salazar said a decision needs to be made about whether the city wants to move forward with the request for expression of interest process, get rid of it entirely or partially, or move to the next highest-rated master developer.

The Central Park Santa Fe group, a team of 40 Santa Feans, was one of the three previous finalists for the exclusive negotiation agreement, alongside KDC/Cienda and Raffles Education Corp., a Singapore-based education group.

Councilor Michael Garcia advised the city not to consider the “garage sale” characterization.

“We’ve all heard the stories of where a garage attendee happens upon the sale and finds a $5 million Billy the Kid picture and they sell it for 75 cents,” he said.

More concrete recommendations will be presented as early as the Feb. 24 council meeting.

(5) comments

Stefanie Beninato

I want to go back and listen to the whole conversation but a few things that jumped out at me from the part I heard:

A need for a new survey since things have changed--that should be done immediately. Councilor Garcia seems to think that people want city hall to move there. I certainly don't agree with that.

It still is a staff driven process--we see where that got us. Right now it seems that the minor partners--many of whom are non profits dependent on city and state funding are still waiting in the wings. I just wonder how what seems like a circular use of public funds is really going to drive development. Or is this a charitable undertaking?

It sounds like the taxpayers are going to be on the hook for what is estimated to be $30 million in mitigation costs and will increase some type of tax or require another bond with the hope and prayer that the property will actually be more valuable than the money already put into it.

And what is this staff recommendation to wait 6 months to a year before trying to get another master developer? the city is bleeding money on paying the interest on the debt on that property thanks to Coss and company's bending over backward to Big Bill's request to buy the CSF when he could not strong arm the legislature into doing so. It has been a losing proposition from day 1.

It seems that no matter how much the city says it wanted to avoid condos and retail that those uses will be there--we can only hope that affordable and below market rate housing is included.

Donato Velasco

the best option is to turn it in to a open park for the community, put it back to its natural state with a trail for walking a true open space.. to serve the community un li9ke special interest groups wanting something for there own use..

Jim Hannan

I was impressed by the Midtown Campus presentation by Allan Affeldt at Journey Santa Fe. Here's a link to an article on his plan:

https://lajicarita.wordpress.com/2019/12/10/the-fate-of-the-former-midtown-campus-in-the-hands-of-santa-fe/

Affeldt has a track record of restoring historic properties in the Southwest.

I would encourage the city to re-engage with Affeldt and his team.

Cathryn Miller

Your first loss is your best loss. Sell it!

Richard Reinders

This situation is not unlike the Presidio of San Francisco, the Military wanted to turn it over to the National Park Service but the Park Service didn't want it in the present shape because the deferred maintenance and shape of the infrastructure. The Military had to bring all the deficiencies up to standard and then the Park Service took ownership. The city may consider handling the asbestos and dilapidated buildings issues to mitigate the risk for a developer. In the long run it will pay back the investment.

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