As the city prepares to consider another revised request for public financing incentives for the barren Gateway project, Mission’s financial consultant says the city will be requesting more detailed financial information from the developers at the Cameron Group.
“I think we’ve learned a lot from the few iterations of working on this project and working with this developer,” Bruce Kimmel of Ehlers told the city council at a committee meeting Wednesday. “Certainly I think we’re all smarter both from the city side and your consultants to ask better and more pointed questions to make sure that we’re not bringing forward something that we’re not reasonably certain has a chance of success.”
Tom Valenti of the Cameron Group has informed the city that the company is in talks with a potential tenant for an office building that could be part of the project. The inclusion of that tenant — whose identity Valenti has not disclosed at this point — is expected to add as much as $44 million to the project budget. (City Administrator Laura Smith had initially reported to the council at a meeting late last month that the budget for that project was around $30 million).
The potential for the office building project to be added, as well as the exit of Walmart from the development, forced Cameron to submit two new public financing requests to replace deals that had already been approved by the council. The city will have public hearings on those requests next month.
Some members of the council expressed leeriness Wednesday about taking up Cameron’s latest tax increment finance and community improvement district applications, pressing Kimmel on what steps the city could take to test the project’s viability.
“I think you’re ready to see a more robust obligation on the developer’s part to really show us more of those tenant commitments that they have as well as financing lined up ahead of time,” Kimmel said in response to a question from councilmember Debbie Kring.
Kimmel also said that he believed the developer would be willing to accept a deal that yielded projected returns below what would be considered standard in the real estate world on account of the significant investment the company has already made in the site with no profit. Cameron will likely make the case that it would not be able to pursue the project without significant public finance incentives.
“They probably have more need built up over the last two years than is really reasonable for the city to help fill,” Kimmel said. “And so hitting that balance is going to be the unique part of this.”