S.J. quits discussions on cannery

OFFICIALS RULE OUT PROPOSED HOME FOR BALLPARK BUT WILL PURSUE OTHERS
By Barry Witt
Mercury News
April 1, 2005

San Jose has pulled out of talks to acquire a closed cannery near downtown as a potential home for Major League Baseball, the developer who controls the property said Thursday.

Mayor Ron Gonzales met last week with Robert Freed, regional general manager of KB Home, which has an option to buy the former Del Monte cannery, and told him the city ``intends to look at other sites and we're not going to continue to negotiate'' for the property, according to Freed's account of the meeting at City Hall.

Gonzales on Thursday would not discuss his meeting with Freed.

``Unfortunately, I can't share the details of that because it's something the council has discussed in executive session,'' Gonzales said, referring to a closed-door city council meeting March 22.

The 13.7-acre Del Monte property on Auzerais Avenue had long been considered by baseball boosters as an ideal location for a ballpark because of its proximity to downtown and access to a new light-rail extension. It also is vacant, meaning the city would not have to deal with relocating residents or businesses, and it has a single owner, making real estate negotiations simpler.

At the secret council meeting, council members heard from city negotiators, including Gonzales aide Joe Guerra, on the status of talks with KB Home over a possible swap of KB's interest in the Del Monte property for eight acres of city-owned land on North San Pedro Street.

KB Home holds a $29.5 million option to buy the cannery and has invested about $5 million in attempting to secure city approval for its development as a 275-unit condominium and townhome project.

When the city solicited bids last year for development of the North San Pedro property, the highest offer was just $9.8 million, suggesting there was a large gap the city would need to fill if it wanted to exchange properties.

Gonzales has said the city's budget outlook remains poor, with no raises being granted to city workers and cuts in city services pending.

The cost of acquiring Del Monte ``was one of the considerations'' in deciding to look at other options, said Councilman Dave Cortese, a founding member of the Baseball San Jose group that is promoting the effort to get the Oakland A's to move to the South Bay. Major League Baseball officials say the move will never happen because the San Francisco Giants hold territorial rights to Santa Clara County.

San Jose is expected to begin focusing on another site just south of the Diridon train station, east of the railroad tracks, which has the advantage of being even closer to downtown and transportation lines. The downsides include the fact the 13.9-acre site has multiple businesses and property owners, some of whom are ready to sell but several of whom could be problematic. Among the properties are parcels on South Montgomery Street held by SBC, the naming rights sponsor of the Giants' ballpark, and a PG&E substation. The Diridon site also is close to several new housing developments, where residents could object to the late-night lights and noise associated with ballparks.

In his State of the City speech in February, Gonzales promised that he would ``submit a proposal to Major League Baseball to bring a team to San Jose.'' On March 20, he held a news conference in Arizona to try to drum up media interest in San Jose's efforts. To date, the city council has not had a public discussion involving a ballpark or baseball other than to pass a resolution last year asking for the Giants' territorial rights to be revoked.

Baseball boosters hoped that the Gonzales proposal would include a ballpark site, but without Del Monte, that appears less likely to happen.

Gonzales said that even without the cannery, he remains undeterred.

``I think there are some other opportunities which we're looking at,'' he said. ``Every site will have its pluses and minuses. We know that from past experience.''

But some boosters say they have no idea what the mayor plans to do now and believe he may be pursuing the wrong strategy in attempting to throw an unsolicited pitch to baseball's leaders.

``I don't know what good it is to make a stadium proposal to Major League Baseball without the other parties at the table,'' Cortese said.

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