Related Company Has Big Pockets for Santa Clara

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The first five months of the initial 18-month negotiating term between Related and Santa Clara are a crucial “due diligence period,” according to a report prepared by Economic Development Officer Ruth Shikada. During this time Related is to complete preliminary work on the property’s “physical condition,” including the possible contamination, and to solicit a preliminary title review from a mutually agreed title company to see if any restrictions on the title insurance would affect project financing or site development.

[contextly_sidebar id=”a9ec36c92e8e724fdb19a7a34a72afad”]Under the terms of the ENA, the city may spend up to $25,000 of a $200,000 Related deposit during the five months to figure out where existing uses on the property, including a golf course and a BMX bicycle race track at 5401 Lafayette St., might be relocated. How and whether the project progress from there remains to be seen.

Related makes a good partner for the city because its development experience is broad. It has no vested interest in finding a certain property type. In addition, the company can respond to market conditions as they evolve over time. There is nothing to say that Related would do all of the vertical development itself, Witte said, though typically it does. The city anticipates a mix of housing, entertainment, retail and restaurants, according to the staff report.

“We have tried to hone in on potential uses that don’t compete with other development in the region but fit a hole in the market at a very strategic location in Santa Clara,” Witte said. “If you look at the demographics there seems to be a real need.”

For the city, whatever happens, it will gain “a huge amount” of insight into the site, Witte said, “all of it on our nickel.”

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