A deal to build an east side Sonoma-Marin Area Rail Transit station, 225 commuter parking spots, and more than 400 housing units to Petaluma appears to have collapsed after differences emerged between the rail agency and a developer.
Lomas Partners, LLC, has been working with SMART for three years to develop its proposal to create housing and 150 parking spots on the site of the future SMART station at Corona Road and North McDowell Boulevard. As part of the deal, the Sherman Oaks-based developer was to buy and develop a SMART-owned piece of land on D Street near the existing station, where Lomas proposed adding 300 rental apartment units and 75 additional parking spaces for SMART riders.
SMART would use the proceeds from the sale of the downtown land to build the station at Corona Road.
SMART claims that tweaks to the plan, including a proposal to build a parking lot rather than a parking garage at Corona Road and relocating the parking lot to a location closer to the station, as well as a missed conference call, constitute breaches in the agreement. The agreement terminated under its own terms because of Lomas’ changes, SMART’s general counsel, Thomas Lyons, wrote in a letter.
Lawyers for the developer claim SMART breached the agreement. The tumult calls into question the future of Petaluma’s east side station and sets the stage for a legal battle.
Farhad Mansourian, SMART’s general manager, did not return multiple calls and emails seeking comment.
The erosion of the deal marks the second setback for SMART in its quest to develop transit-oriented housing along the rail line. Last month, a developer walked away from plans to build 268 units of market-rate and affordable housing, retail spaces and a public plaza on a SMART-owned lot in Santa Rosa’s Railroad Square. The deal collapsed amid finger pointing over who was responsible for its demise, with SMART arguing the developer wasn’t committed and the developer deeming SMART’s board unreasonable.
Todd Kurtin, a partner at Lomas, said his lawyer is drafting a letter of complaint stating that SMART’s termination of the contract is not in good faith. He said he’s willing to build a parking garage should SMART prefer that option, but said he has been stonewalled by the agency. If his lawyer’s calls to the agency are not returned, he plans to file the legal complaint.
Even without a SMART station, Kurtin said he plans to develop the Corona Road land with housing, though he would prefer to locate his development near a transit hub.
He hopes to salvage the deal with SMART, which would bring 112 homes, 15 percent of which would be affordable, for-sale units, to a currently underutilized Corona Road parcel. It would also unlock the potential for an east Petaluma station that would provide much-needed parking and cut down on congestion some west side merchants say is negatively impacting business.
“I’m trying to move this forward, I’m trying to get the station built at Corona, I’m trying to get the housing built — that’s exactly what the public wants and what the public policy should be and I don’t understand where SMART’s coming from,” Kurtin said.
A series of letters between SMART and the developer dating back to December outline a contentious back-and-forth leading up to SMART’s Jan. 19 “final notice” that the agreement was terminated. Part of the issue appears to be a Jan. 8 missed phone conference to discuss the change in plans, a scheduled meeting in which Kurtin says he inadvertently missed after failing to see the call-in number.