Emerald Isle housing project in Santa Rosa’s Fountaingrove neighborhood hits the market at $5 million

Emerald Isle, a planned 82-unit, age-restricted condominium project in Santa Rosa’s upscale Fountaingrove area, has been put up for sale by parent company Oakmont Senior Living before any groundbreaking on the complex.

Developer Bill Gallaher, owner of Oakmont Senior Living, has listed the entitled 12.6-acre property at $5 million.

The move comes after a difficult initial slog through the city approval process, where some project critics called out its location — in the heart of a neighborhood nearly leveled by the Tubbs fire in 2017 — and questioned whether such housing ought to be allowed in a hilly area hit twice by massive wildfires in the past half-century.

First pitched by Gallaher’s company as another in a series of senior care complexes it owns and operates in the area, Emerald Isle was revised into a condo project and Santa Rosa officials approved it in October 2019.

The underlying motive for the sale remains unclear.

Oakmont Senior Living officials declined to comment, and a broker whose company touted the listing in a news release said he was not authorized to talk about the project, the listing or the circumstances surrounding the decision to sell Emerald Isle.

The property, already entitled with an approved project, is likely to find a buyer due to its location in the affluent and scenic Fountaingrove area, said Keith Woods, CEO of the North Coast Builders Exchange, who was careful to avoid speculating about Gallaher’s reasons for unloading the site.

“By Bay Area and Southern California standards, we’re still a bargain,” Woods said. “There’s always going to be somebody out there that sees the potential.”

The property is adjacent to the 18-hole course at the Fountaingrove Club at the east end of Gullane Drive.

Oakmont Senior Living in early 2018 sought Santa Rosa’s approval to build a combination assisted living and memory care facility — mere months after the 2017 Tubbs fire destroyed another of Oakmont Senior Living’s Fountaingrove facilities, Villa Capri, a half-mile away.

Elderly residents of that site and a neighboring Oakmont Senior Living facility were abandoned by managers and staff as the Tubbs fire bore down, according to state investigators and the company’s own admissions in a 2018 settlement with state regulators that allowed it to operate the facilities going forward.

Oakmont Senior Living has rebuilt and reopened Villa Capri and continues to operate three other Fountaingrove senior complexes: Varenna at Fountaingrove, Fountaingrove Lodge and The Terraces.

The ongoing wildfire threat remains a potential barrier for development, said Woods, adding that the 2019 Kincade fire and the 2020 Walbridge and Glass fires illustrated that catastrophic fire risk in Sonoma County would extend beyond the 2017 burn zones, including Fountaingrove, where nearly 1,600 homes burned.

“The only wild card in this is if either insurance issues or people’s reluctance to be in a proven fire zone could scare off developers,” Woods said.

The initial Emerald Isle concept included 49 units and was slated to open in 2019. But after the city’s Design Review Board approved the project in March 2018, two Santa Rosa women appealed the project to the City Council. One was the daughter of an 84-year-old whose mother was among those abandoned by staff in Oakmont of Villa Capri.

Oakmont Senior Living took the decision out of the council’s hands, dropping the senior care concept as of September 2018. By the following January, Oakmont had revived the project as a more traditional housing proposal: several low-rise buildings with two-bedroom condominiums, spread out alongside about 6 acres of open space and restricted to tenants 55 years and older.

A March listing for Emerald Isle bills the $5 million offering as a “rare” development opportunity and touted low-maintenance condos with golf course views that would “have wide appeal with this buyer demographic.”

The project’s Oct. 24, 2019 approval, granted by the Planning Commission, has an initial term of two years but could be extended for several years more under local rules and a new state law that could trigger an automatic 18-month extension, said Andrew Trippel, acting supervising planner with the city of Santa Rosa.

In November 2019, the Santa Rosa City Council voted unanimously to require most new residential buildings up to three stories to use all-electric appliances, forcing builders and tenants to make do without natural gas in future developments in a bid to whittle away at the city’s carbon footprint.

Emerald Isle won planning approval and had pending building permits before the city’s all-electric requirement took effect, but those original building permits have been withdrawn, and any new applications to build the project would be subject to the all-electric rule, according to Jesse Oswald, the city’s chief building official.

Gallaher opposed the natural gas ban and subsequently sued the city in January 2020, seeking to invalidate Santa Rosa’s new rule. He and a separate developer group also filed similar lawsuits against the town of Windsor and prevailed last year when the Town Council voted to repeal Windsor’s natural gas ban to avoid potentially costly litigation.

Santa Rosa has showed no such qualms, and a Sonoma County judge hearing Gallaher’s lawsuit signaled in January he was leaning toward siding with Santa Rosa. That case is still pending a final ruling.

You can reach Staff Writer Will Schmitt at 707-521-5207 or will.schmitt@pressdemocrat.com. On Twitter @wsreports.