Sunnyvale Town Center

Sunnyvale Town Center was a 36-acre[1] two-level shopping mall located in Sunnyvale, California, USA. It was anchored by Macy's, Target, and J.C. Penney. As of August 2015, only the Target and Macy's stores remain operational: much of the mall consists of a construction site on which work was stalled from 2009 to 2015 a result of a legal dispute.[2][3][4][5][6][7][8] In August 2015 the litigation ended, and Wells Fargo announced that it sought to sell the mall to a developer.[9]

History

The mall, bounded by Mathilda Avenue, Washington Avenue, Sunnyvale Avenue, and Iowa Avenue, opened in 1979. Over the years, the development went through a series of owners who either defaulted on loans, or were sued for breach of contract. During that time, the mall fell into decline with changing tastes of shoppers and the emergence of newer and larger competitors. Finally, in 2007, new entities named "Downtown Sunnyvale Mixed Use LLC" (DSMU) and "Downtown Sunnyvale Residential LLC" (DSR) took over the mall. DSMU and DSR were partnerships between Silicon Valley developer Peter Pau's Sand Hill Property Co. (which owned about 5%), and RREEF, a real-estate management business owned by Deutsche Bank (which owned the remaining 95%). DSMU/DSR's goal was to redevelop the mall into a high-end retail, residential and office development similar to San Jose's successful Santana Row.[10] Plans for the projected development, which would have included a movie theater, remain on the City of Sunnyvale's website.[11]

DSMU/DSR took out a loan of $108.8 million from Wachovia Bank; Wachovia was later acquired by Wells Fargo.[12] By June 2009, DSMU/DSR defaulted on the loan. Peter Pau claims that the decision to default was made by RREEF without his consent.[12] After the default, Wells Fargo started foreclosure proceedings. A foreclosure auction in August 2011 attracted no bidders, so Wells Fargo took possession of the property itself.[1][10] The bank then attempted to sell the land to another developer, but this attempt was thwarted by a lawsuit from Pau.[12] Ever since, further development has been thwarted by the ongoing litigation between Pau and Wells Fargo. In May 2012, the City of Sunnyvale issued a press release accusing Pau of having filed "delaying lawsuits that have served little purpose other than to hold the project hostage",[12][13] and claiming that "a nationally-recognized development team was set to come in and finish the project in 2011 ... until the barrage of lawsuits blocked their entry".[13] In February 2013, further appeals were filed by both Pau and Wells Fargo; Pau's attorney estimated that the appeals would delay resolution of the case by at least two years.[14]

Current status

As of January 2015, the only active tenants of the downtown proper (apart from Target and Macy's) are Apple and Nokia, which have occupied office space along Mathilda Ave.[14] The remaining retail and entertainment space is still under construction, and the residential units are unfinished.

On January 20, 2015, the California Court of Appeals, in an unpublished opinion, rejected one of Pau's two appeals.[15] On May 19, the Court of Appeals rejected Pau's remaining appeal.[16] Pau's attorney stated that the developer was considering an appeal to the California Supreme Court.[17]

On August 12, 2015, the California Supreme Court declined to review the decision, effectively ending the litigation. The same day, Wells Fargo announced that it intended to sell the mall.[18]

On November 18, 2015, Wells Fargo announced that it intended to sell the mall to an ownership group made up of J.P. Morgan Asset Management, Sares Regis Group and Hunter Properties. That announcement triggered a 20-day review period during which the Sunnyvale City Council evaluated the proposed ownership group. On December 10, 2015, the Council voted to acknowledge that the new ownership group met the necessary criteria, effectively allowing the sale to proceed.[19]

Nearby developments

As of July 2013, one new restaurant has opened across from the BRE and Carmel Properties projects at the former Town and Country site. The apartments are scheduled to be available for occupancy by August 31, 2013. All other construction projects put on hold remain so, and all other residential units remain unfinished.

As of October 2013, one of the Solstice-BRE apartment sites has opened, and 2 restaurants and Japanese Relocation Center is set to open in 2014. More restaurants and retail locations are expected to be leased in the remaining space before the end of 2013. The second building is set to open in November 2013, and will begin leasing apartment units and retail/restaurant space soon after.

Across from the opened Solstice Building, Rokko, a Japanese restaurant, and NK Trends, a women's clothing store, have opened, and 2 other restaurants (named Bambu and Bamboo) are set to open later in October. All other construction projects (on McKinley avenue and Taaffe street) are still on hold.

References

  1. 1 2 Wilson, Alia (August 18, 2011). "No bidders for Sunnyvale Town Center means project in hands of Wells Fargo". San Jose Mercury News. Retrieved August 18, 2011.
  2. ↑ Nick Hoff (September 21, 2002). "When suburban goes urban". InTheFray Magazine. Inthefray.org. Retrieved 2010-03-02.
  3. ↑ Conrad, Katherine (2010-01-29). "Sunnyvale Town Center gets buttoned down as options are weighed". Silicon Valley / San Jose Business Journal: (Sanjose.bizjournals.com). Retrieved 2010-03-02.
  4. ↑ Conrad, Katherine (2009-04-10). "Sunnyvale Town Center on hiatus". Silicon Valley / San Jose Business Journal: (Sanjose.bizjournals.com). Retrieved 2010-03-02.
  5. ↑ Carney, Tiffany (January 20, 2010). "Stalled Sunnyvale Town Center is focus of city's five-year plan". Sunnyvale Sun. Retrieved 2 March 2010.
  6. ↑ "Sunnyvale Town Center - CLOSED - Sunnyvale, CA". Yelp.com. Retrieved 2010-03-02.
  7. ↑ Scott Parsons (2006-12-08). "Sunnyvale Town Center - The Unauthorized Guide". Bigmallrat.com. Retrieved 2010-03-02.
  8. ↑ "Sunnyvale Town Center". Campanellacorporation.com. Retrieved 2010-03-02.
  9. ↑ http://www.bizjournals.com/sanjose/news/2015/08/13/sunnyvale-town-center-officially-for-sale-as.html
  10. 1 2 https://www.baycitizen.org/news/real-estate/sunnyvales-town-center-goes-sale-nobody/
  11. ↑ http://sunnyvale.ca.gov/HotTopics/DowntownDevelopment/TownCenterPlans.aspx
  12. 1 2 3 4 "Tensions Flare Over Stuck Sunnyvale Project". Wall Street journal.
  13. 1 2 http://sunnyvale.ca.gov/Portals/0/Sunnyvale/news_releases/2012/NR%2005%2012%2012%20-%20STC.pdf
  14. 1 2 http://news.theregistrysf.com/new-appeals-threaten-to-stall-sunnyvale-town-center-redevelopment-for-years-2/
  15. ↑ http://www.courts.ca.gov/opinions/nonpub/H038572.PDF
  16. ↑ http://www.courts.ca.gov/opinions/nonpub/H039332.PDF
  17. ↑ http://www.bizjournals.com/sanjose/news/2015/05/19/sunnyvale-town-center-ruling-deals-blow-to-paus.html
  18. ↑ http://www.bizjournals.com/sanjose/news/2015/08/13/sunnyvale-town-center-officially-for-sale-as.html
  19. ↑ http://sunnyvale.ca.gov/Portals/0/Sunnyvale/news_releases/2015/NR120315-TownCenterCriteriaDecision.pdf

Coordinates: 37°22′33″N 122°01′54″W / 37.37575°N 122.03166°W / 37.37575; -122.03166

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