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Chanate Road campus buyer’s plans could include housing, retail, hotel, golf course or casino

Chanate Road campus at a glance

The Las Vegas developer who this month submitted the winning bid for the 72-acre Chanate Road campus in northeast Santa Rosa shared his potential plans for the site with The Press Democrat.

Here are some details about the property, which is nearing a sale after four years of failed attempts by Sonoma County officials to unload the site.

The $15.05 million sale of the property would be the largest involving surplus county land in a generation. It presents an opportunity for the kind of high-profile housing project that local officials have long touted for the site.

For the past seven years, the property — home of the former community hospital and county offices — has sat mostly vacant after its primary occupant, Sutter Health, relocated to its current hospital site on Mark West Springs Road.

A long list of developers have offered to buy the campus following an initial $11.5 million sale agreement in 2017. That deal with Bill Gallaher, which called for up to 870 housing units, was scuttled by a successful lawsuit waged by neighbors concerned about the scope and environmental impact of the proposal.

The property is home to a county public health lab and morgue as well the Coroner’s Office. Under the terms of the sale agreement, those facilities can remain at the site for at least the next four years.

The Las Vegas developer who earlier this month submitted the winning bid for the Chanate Road campus in northeast Santa Rosa says his plans for the county property could include housing, retail storefronts, a hotel and resort, golf course or potentially even a casino.

In an auction sale on Nov. 9, Eddie Haddad, a longtime real estate broker who has bought up hundreds of foreclosed homes in Nevada, offered $15.05 million for the nearly 72-acre property.

Last week, county supervisors unanimously approved selling the Chanate campus for the full bid price to Haddad and his company Resources Group LLC. The sale, the county’s fifth attempt to offload the property, is set to be finalized on Dec. 22.

In interviews, Haddad said he aims to work closely with neighbors to come up with a proposal for the site that makes sense for the community and is also financially feasible. Previous developer proposals have bogged down amid neighborhood opposition or failed to advance through purchase talks with the county.

“We have to come together to talk these things through,” Haddad said. “If everybody's comfortable with a nice resort, even a casino — I don’t know.”

For the past seven years, the Chanate property — home of the former community hospital and county offices — has sat mostly vacant after its primary occupant, Sutter Health, relocated to its new hospital site on Mark West Springs Road.

Vandalism, rising maintenance costs, a bruising court battle with neighbors and the specter of a fault line running under the property have since clouded the fate of the crumbling campus — which officials have long eyed for hundreds of new homes as the region has struggled through an intensifying housing shortage.

Haddad said a future project could include single-family homes and apartments, though he declined to put a number on how many units he might plan to build. The property carries an affordable housing covenant, meaning at least 15% of all homes on the site must be reserved for people with low- or moderate-incomes.

In addition to new housing, Haddad said, a hotel, golf course, small shopping center and tribal casino are all on the table.

“We definitely want to reach out to the neighborhood and start talking about whether there’s any desire for commercial (development), or is it going to be residential only?” Haddad said.

In winning the property at auction, Haddad was not required to disclose plans for the site. The only information shared with the county during the auction was each bidders’ identity and offer amount.

Supervisor Chris Coursey, who represents the area that includes the Chanate Road property, said he has not spoken with the developer or seen any vetting beyond the financial verification county staff shared with the Board of Supervisors before its vote to accept Haddad’s bid.

Asked if he had seen any additional background on the buyer, Coursey said, “I Googled him.”

Should the sale go through next month, Santa Rosa officials, including the City Council, will have final say over any proposed development at Chanate – except for a tribal casino, which would require only state and federal approval.

“The decisions here are not in my hands once the escrow is closed,” Coursey said.

The property’s sale represents the largest disposition of surplus county land in at least a generation, and finally presents an opportunity for the kind of high-profile housing project that local officials have over a decade touted for the property.

But Santa Rosa Mayor Chris Rogers said the road to Haddad earning city approval would be “in years, not in months,” and there is likely to be strong opposition to almost any proposal put forward.

If county supervisors appear relieved to be nearing the conclusion of their ownership of Chanate, city officials are gearing up to take on the property and all its complications. But that’s not unexpected, Rogers said.

“We’ve always known that we had the ultimate land use authority on it and that it would land in our lap,” the mayor said. “It was always just a question of when and in what form.”

Big question mark for the city

Last week, Haddad had a Zoom conference call with city planning staff for an initial discussion about the site. During the call, Haddad had questions about housing development but did not inquire about uses like a golf course or resort, according to city planner Adam Ross, who was on the call.

The first time the public will likely get a look at Haddad’s official plans for the property is when he submits a description of his proposal for the site to the city. Community members will then have a chance to weigh in on Haddad’s plans, as the submission kicks off a neighborhood meeting.

Chanate Road campus at a glance

The Las Vegas developer who this month submitted the winning bid for the 72-acre Chanate Road campus in northeast Santa Rosa shared his potential plans for the site with The Press Democrat.

Here are some details about the property, which is nearing a sale after four years of failed attempts by Sonoma County officials to unload the site.

The $15.05 million sale of the property would be the largest involving surplus county land in a generation. It presents an opportunity for the kind of high-profile housing project that local officials have long touted for the site.

For the past seven years, the property — home of the former community hospital and county offices — has sat mostly vacant after its primary occupant, Sutter Health, relocated to its current hospital site on Mark West Springs Road.

A long list of developers have offered to buy the campus following an initial $11.5 million sale agreement in 2017. That deal with Bill Gallaher, which called for up to 870 housing units, was scuttled by a successful lawsuit waged by neighbors concerned about the scope and environmental impact of the proposal.

The property is home to a county public health lab and morgue as well the Coroner’s Office. Under the terms of the sale agreement, those facilities can remain at the site for at least the next four years.

A city website dedicated to the Chanate campus indicates any large-scale proposal would likely require rezoning the use of the property, conducting an exhaustive environmental review and amending Santa Rosa’s general plan.

Councilwoman Victoria Fleming’s northeastern Santa Rosa district includes the Chanate campus and the hillside neighborhoods above it. Fleming, who described herself as a “staunch and fierce” advocate for housing, said her principal worry is that housing, a resort or a hotel at the site would increase traffic along narrow, winding Chanate Road during any future nighttime fire evacuations.

She said any development at Chanate would have to be carefully calibrated to win the backing of her wary constituents, and her.

“The safety of the surrounding neighborhoods and the residents who inhabit those neighborhoods is paramount,” Fleming said. “I will be monitoring this situation as it develops very closely.”

To assuage residents’ immediate concerns about security once the property changes hands, Haddad said he aims to start the demolition of all vacant buildings at Chanate as soon as the sale goes through.

Haddad said the construction contractor he selects to tear down the site would be in charge of hiring a private firm to monitor the property during demolition, which could take about sixth months. After that, he doesn’t anticipate needing security before the project is completed.

“This is why we want to pull the demolition permit immediately,” he said. “If we get the demolition permit, that would be all taken care of by the contractor.”

Talk of a tribal casino

Following the auction of the property, there’s been speculation that Haddad — a relative unknown in the North Bay — could team up with an Native American tribe to build a casino, according to a half dozen interviews with local officials and housing advocates.

In an interview with Haddad on Friday, he ruled out any plans for a casino.

“No, we’re not proposing a casino site,” he said.

But in a follow-up call on Monday, Haddad said he raised that possibility with his lawyer after a Press Democrat reporter’s earlier questions about tribal gaming.

“I did ask my attorney about it and he said, ‘Let me know when you’re ready to discuss. It’s certainly been done,’” Haddad said.

To build a casino at Chanate, a tribe with ties to the area would need to apply to have the federal government designate the property as tribal land, before seeking additional state and federal approvals, a process that generally takes years to see through. The city or county would not have jurisdiction in that process.

Haddad said he has not yet contacted any tribes about the property, adding he hasn’t been involved in casino development in the past.

The most recent step toward casino development in the North Bay came from the Koi Nation, a federally recognized tribe based in Sonoma County, which in September announced plans to turn a 68-acre vineyard southeast of Windsor into a $600 million casino resort.

Representatives with the Koi Nation; the Lytton Band of Pomo Indians, which is based near Healdsburg and operates a casino in San Pablo; and the Dry Creek Rancheria Band of Pomo Indians, which is based near Geyserville and operates the River Rock Casino there, all said they had not been contacted by Haddad.

The Federated Indians of Graton Rancheria, which owns the Rohnert Park-area Graton Resort and Casino, the largest tribal gaming destination in the Bay Area, did not return a request for comment.

If Haddad intends to take into account residents’ concerns in coming up with a proposal for the property, Fleming, the Santa Rosa councilwoman, said any plans for a casino should be a nonstarter.

“I think it’s a big stretch to imagine the neighbors or the community more broadly getting to a place of welcoming a casino,” she said. ”I just think that is unimaginable.”

Developer’s past and present projects

In recent years, Haddad has bought two other large-scale properties to redevelop in Nevada and California.

One is the shuttered Legacy Golf Course in Henderson, Nevada, which he purchased for $1.5 million in 2017 with partner Georges Maalouf to build luxury apartments and a hotel around the course. Neighbors filed a lawsuit to stop the project in 2018, before the parties agreed that only part of the property could be developed, according to the Las Vegas Review-Journal.

Then in March of this year, Haddad and Maalouf won a bid for a 59-acre former Coast Guard site in Contra Costa County. The site, known as Concord Villages, is currently empty military housing bordering a separate massive planned housing development at a former naval base and Superfund site. The pair paid $58.4 million for the property, where they hope to add 2,000 housing units, according to the San Francisco Business Times.

Around 2006, Haddad proposed a 38-story apartment building in downtown Las Vegas called the HUE Lofts at Art Central. That project failed when the construction industry stalled during the Great Recession, he said.

Still, the economic downturn and accompanying housing market collapse weren’t all bad for Haddad. During that period, one of his companies, Saticoy Bay LLC, purchased hundreds of foreclosed homes in Nevada for rock-bottom prices and turned many into rental properties.

“There were a number of opportunities that were available to acquire properties,” Haddad said. “ ...The intent was always to buy properties to recycle and bring back to market.”

Haddad bought the homes at auction after owners defaulted on their homeowners association dues. By paying off only the HOA liens, Haddad was able to acquire the properties instead of the banks that owned the outstanding mortgage debt on the homes.

That set off a flurry of litigation by banks and mortgage lenders. And in 2014, the Nevada Supreme Court sided with Haddad that his company was the rightful owner of homes purchased through that process. The following year, the Nevada State Legislature passed a law making it easier for banks to redeem homes foreclosed on by HOAs.

It’s unclear what understanding Sonoma County officials have of Haddad’s business background beyond what was shared with the board about his financial wherewithal.

Caroline Judy, the government’s chief real estate official, responsible for overseeing the Chanate sale, did not make herself available for an interview Monday and Tuesday to discuss that process.

The county remains on track to close escrow, she said by email, and “all parties are working together to ensure a successful closing.”

Checkered recent history of county site

If Haddad has lawsuits in his past, so does Chanate.

In 2017, a $11.5 million sale agreement with local developer Bill Gallaher was scuttled by a successful suit filed by neighborhood group Friends of Chanate over the scope and environmental impact of his proposal. It called for up to 870 housing units, as well as amenities such as a grocery store, amphitheater and dog park.

The campus neared a sale other times, but negotiations repeatedly failed over myriad issues including uncertainty of the exact location of the Rodgers Creek Fault.

Haddad said he is well aware of property’s history and the suit that killed the Gallaher proposal. To avoid a similar dispute, he intends to involve neighbors early in the planning process, he said.

“This is the difference between myself and the prior developer,” Haddad said.

You can reach Staff Writer Ethan Varian at ethan.varian@pressdemocrat.com or 707-521-5412. On Twitter @ethanvarian

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