Sonoma County supervisors restart Chanate Road land sale

Sonoma County supervisors have agreed to begin again on another effort to sell the county’s troubled Chanate Road campus in northeast Santa Rosa after halting negotiations with at least two developers that had been eyeing the 72-acre property for housing.

The decision, announced Tuesday at the Board of Supervisors meeting, sets in motion the fifth attempt since 2017 to unload the largely vacant former hospital site, long been envisioned as a prime spot to boost the supply of new housing.

But last month, Newport Beach-based Village Partners became the latest developer to walk away from the property, dropping its tentative deal to pay the county nearly $8 million. That led the county to rekindle talks with two other bidders in last year’s search for a buyer.

But the county isn’t advancing a deal with either, according to County Counsel Robert Pittman. Oakmont Senior Living, owned by local developer Bill Gallaher, had offered $4.24 million for the property, while City Ventures, an Irvine-based real estate firm, had bid $6.5 million.

Chris Coursey, the new 3rd District supervisor representing the area, would not elaborate on why the county was bypassing deals with either of those firms in favor of an altogether new sale effort.

“I think it speaks for itself,” Coursey said, declining to say more because of confidentiality concerns related to the board’s closed-session decision. “I can’t, as you know, talk about any of the details.”

Representatives from Oakmont Senior Living and City Ventures did not return phone messages Tuesday seeking comment.

Other offers in the past round that did not come up for negotiations were from local developer Bruce Codding, whose Paulin Pavilion Investors group bid $5 million, and a $4.88 million bid from Triad Christopherson, a group of developers including Santa Clara-based Curt Johansen and Santa Rosa-based Keith Christopherson. Neither group returned phone or email messages seeking comment, although Codding previously shared via email that his group was “still very much interested in the site, and we are doing what we can to be included…”

The push by supervisors to restart the sale process comes after county supervisors’ self-imposed Dec. 31 deadline to offload the property — the fourth time the county’s protracted efforts to sell the site for housing have failed.

“With Chanate, we’ve found ourselves back at square one far too many times,” Board of Supervisors Chair Lynda Hopkins said via text message. “We have faced a tremendous number of setbacks ... But I’m also hopeful, with Supervisor Coursey leaning into this issue, that we’ll have an opportunity for a fresh approach and innovative problem solving.”

Coursey was tight-lipped discussing the prospects of another Chanate sale — the approach favored by the board majority in its closed-session meeting last week but not reported out until Tuesday.

“I made it pretty clear during my campaign that my preference would be to take a different approach, rather than doing the same thing again,” Coursey said. “That said, I support the majority of the board, and we’ll see what happens.”

After years of seeking a buyer for the property, supervisors in October accepted Village Partners’ $7.8 million bid only to see negotiations crumble after the firm sought a lower price. They called out concerns about the site’s seismic safety — the Rodgers Creek fault runs under the property — and other concerns, Michael Morris, a Village Partners principal, said in a previous interview.

"They came back wanting a price adjustment and a change in terms. The county counter offered, and ultimately, they decided to exit the deal,“ said Sonoma County General Services Director Caroline Judy said last month. She could not be reached for comment on the latest developments.

In 2017, supervisors first agreed to sell the land to Gallaher, who offered up to $12.5 million as part of a plan to build up to 867 housing units at the site along Chanate Road, a winding, wooded corridor south of Santa Rosa's Fountaingrove neighborhood.

Neighbors rallied against the sale, filing a lawsuit tied to environmental concerns that forced the county to drop the deal with Gallaher in 2018.

More setbacks on attempts to sell the property followed.

California Community Housing Authority, a quasi-governmental entity based in the Central Valley, backed away from a potential deal in fall 2019, and subsequent negotiations with another buyer, San Rafael-based EAH Housing, fell apart last February.

As the county's difficulties over the land sale escalated, security and maintenance costs for the site increased, reaching $768,000 for the period between July 2018 and June 2019.

The mounting problems included break-ins leading to vandalism, theft and outright squalor inside many of the now-abandoned buildings making up the former hospital campus, vacated by Sutter in late 2014.

It became a quagmire for the county and especially for Shirlee Zane, Coursey’s predecessor in the 3rd District supervisor seat. Last month, in her final days in office, she said the county’s failed attempts to sell the property for housing marked her greatest disappointment in her 12 years in office.

Her support for the initial deal with Gallaher — one of her biggest political benefactors — became a rallying cry for neighbors opposed to the deal and constituents who voted her out of office.

Coursey characterized last week’s closed-session discussion as “unremarkable,” and he couldn’t put a timeline on when he would like to see the county move on from the property.

“We’re going to find out what happens with this process,” he said. “We’re trying again to put it on the market.”

You can reach Staff Writer Tyler Silvy at 707-526-8667 or tyler.silvy@pressdemocrat.com.