City to consider buying Islander Motel
The City Council is set to consider buying the Alameda Islander Motel and moving forward with plans to redevelop it as housing for low-income workers. The Islander’s owner wants $8 million for the property, city officials said.
The agreement would give city staff a year to come up with the money to purchase the 69-unit motel, which sits at 2428 Central Avenue. The city may need to raise up to $10 million of its own money to buy and redevelop the half-acre property, and will need to issue bonds to do so, according to a city staff report.
The council, sitting as the Community Improvement Commission, is set to discuss the proposed purchase Tuesday. City staff is also planning to seek out a developer to revamp the site.
An unnamed San Diego-based affordable housing developer had entered into an agreement to purchase the property in June, but the deal fell through when the developer was unable to negotiate a reduction in the owner’s $8 million asking price or an extension of time to complete the deal, according to the staff report.
The Islander began its life in 1971 as a 62-unit apartment building, which was later converted into a motel. About a third of the units there are exempt from paying the city’s transit occupancy tax because they house people for longer than 27 days.
Property records listed the taxable value of the motel at $1,122,781.
In other development news, the council will also consider whether to okay an exclusive agreement with Warmington Homes that would allow the developer to build homes where the Alameda Animal Shelter and the city’s Corporation Yard now stand.
The San Ramon-based developer would have 18 months to work out a deal with the city to develop 25 to 27 homes on the properties, which sit adjacent to its current Grand Marina project, at 1590 Fortmann Way and 1616 Fortmann Way. Their right to negotiate a deal would expire in May of 2012, though city staff anticipate a deal can be hammered out by August of 2011.
Meanwhile, the city would work to figure out where the animal shelter and corporation yard would go – and how they would come up with as much as $5 million to move them. The council in September allotted $376,000 to study potential relocation sites, and the study is expected to be completed in May of 2011.