The controversial proposal to build housing at Macy’s is dead on arrival, but a new idea has sprung to life.
Yardi Systems is negotiating with the city of Santa Barbara to move 600 employees from its Goleta office to the State Street Macy’s building.
“Our plan would not include housing at the Macy’s site,” said Ben Romo, a spokesman for Yardi Systems. “One of the big motivators here is this would be a big boost to revitalizing State Street. This would be hundreds of employees downtown.”
City Administrator Kelly McAdoo said Yardi Systems approached the owners of the Paseo Nuevo mall lease, Alliance Bernstein, and the city of Santa Barbara about moving office workers downtown.
“Yardi Systems has a great reputation in the community,” McAdoo said. “We are very fortunate to have them. It is not housing, but we believe it is equally catalytic to have employees downtown patronizing businesses and restaurants.”
McAdoo said the proposal is a good alternative for the community. She hopes to bring it to the City Council this summer.
Santa Barbara had been in negotiations with Alliance Bernstein and The Georgetown Company to build housing at the former Macy’s building, but the proposal blew up over concerns that the city was giving away the land underneath the mall to a private developer and not getting enough affordable housing in return.
The city at the time proposed giving away the land underneath Paseo Nuevo, and a portion of property tax revenue, at a total value of $32 million to $39 million.
In exchange, AB Commercial and its developer, The Georgetown Company, wanted to demolish the former Macy’s building to build 209 market-rate apartments and 24 affordable-housing units.
The council voted against the deal earlier this year, forcing Alliance Bernstein to walk away. The company needed assurance from the City Council that a long-term lease agreement could be worked out, in addition to the land giveaway, in order to make the housing project profitable.
Yardi Systems, however, then approached the city about relocating its headquarters downtown.
“We think it could be a very good thing for the community,” Romo said. “We are very excited about downtown housing and adaptive re-use.”
Some housing is still proposed for the mall. The owners of the former Nordstrom building, Shopoff, have proposed between 80 and 112 units, with 10% affordable.
Santa Barbara City Councilwoman Meagan Harmon said she is “super-happy” about the Yardi proposal.
“It’s a huge economic win to have Yardi, and also allows (the city) to keep the mall, without razing the building to build housing,” Harmon said.
