Duarte Shifts Gears on Central Avenue : Development: After putting the brakes on its much-delayed 210 Freeway auto dealer mall, the city is planning a commercial, office and restaurant complex.

By VICKI TORRES

Feb. 17, 1991 12 AM PT

TIMES STAFF WRITER

DUARTE — The city’s dream of a 10-dealer auto mall on Central Avenue is finally over.

After five years and $16 million spent assembling land and relocating a school, Duarte faced a nightmare of dealer back-outs and bankruptcies for its 210 Freeway Autoplex.

Now, with the economy slumping and car dealers ailing, the Duarte Redevelopment Agency has a new plan for Central Avenue: a commercial, office and restaurant complex, anchored with a couple of car dealers.

“We’re going to end up with a Central Avenue more lucrative and beneficial to the city in the long term than the original project,” said Mayor Ginny Joyce.

Although the Redevelopment Agency has been pursuing its new direction for months, the city’s plans were news to Tom Carroll, manager of Toyota of Duarte, the lone car dealer still doing business on Central.

Carroll said the shift could hurt his sales. “If it’s an office building, it’s not going to generate any income for the city of Duarte, and it won’t do anything for my business,” he said.

The shift also comes at a time when office development is nearly at a standstill, even in booming locales such as Glendale and Burbank, commercial realtors say. “It’s energetic, let me put it that way,” Glendale real estate agent Gordon Martin said of Duarte’s plans.

But, Duarte officials are optimistic about the new plans, which include:

Construction of two large buildings on 2.93 acres at Central and Mountain avenues. Developer Don Pratt has plans to buy land formerly held by car dealer Dennis Assael to build a 17,000-square-foot structure for Staples Office Supply. A second, 25,000-square-foot building is to house another large tenant. The Staples store is expected to bring Duarte $100,000 annually in sales taxes.

* The sale of 14.5 acres of city-owned land between Bradbury Avenue and Buena Vista Street for $20.8 million. The city wants to sell to a developer willing to build a seven-story, 500,000-square-foot office building and two restaurants, including one in the old school administration building on the site.

* Sale of 5.5 acres at the northeast corner of Buena Vista and Central to Nissan Motor Corp. USA. Nissan is in the process of buying property formerly owned by Robert Low, owner of Duarte Nissan, Suzuki and Isuzu, who declared bankruptcy and went out of business last year. Nissan plans to spend up to $1.8 million in site improvements to open a Nissan dealership by March 1. An Infiniti dealership is planned eight months later.

Tokai Credit Corp., holder of nearly $14 million of debt against Duarte Nissan, tried to block the sale of Low’s land to the Nissan corporation. But the federal bankruptcy court in Los Angeles ruled against Tokai. The sale is expected to be completed within the next few weeks, City Manager Jesse Duff said.

In addition, the agency is also working on plans for nearby land south of the Foothill Freeway. La Mesa RV, which opened a recreational vehicle dealership Jan. 6 on vacant city land on Central, plans to move to a seven-acre site at Mountain and Hamilton avenues once the agency has assembled the land. The agency also hopes to locate a large discount store next to La Mesa RV.

The autoplex, Central’s first development plan, began in 1985 and zipped along at first. Five dealerships were in business by 1987: Toyota of Duarte, an accompanying Mitsubishi dealership and Low’s three lots. Another five dealers planned to move onto the 14.5-acre former site of Northview Intermediate School.

But buying the land from the school district, rebuilding Northview and constructing a school auditorium ate up precious time. By the time the land was ready, a slumping economy caused the dealers to pull out.

Duff said, however, that the city has learned a lesson from the collapse of its plans. The new mix of commercial space, office building, restaurants and car dealers will provide a more diversified and sound economic base, he said.

In addition, sale of the 14.5 city-owned acres as office space at $33 a square foot will give the city $20.8 million immediately, he said. If the city had sold the land to auto dealers at $8 a square foot, it would have taken years before sales taxes yielded the same amount, he said.

Hayes and Co. agent Dave Powell, who is handling the land sale for the city, said he is not wooing developers, but tenants. In today’s economy, developers no longer build projects on speculation.

“Today, you have to have 40% preleasing to get a whole project done,” he said.

On the Duarte site, four “household name” companies have shown interest as tenants, he said. He declined to provide further information.

Duff said the city can take advantage of the current shift in office space construction toward the eastern San Gabriel Valley. Pasadena’s 2-year-old growth-management initiative has been cited by developers as one reason they are looking east.

“They have to look someplace,” Duff said, “and the land’s cheaper here.”

Martin, a 22-year real estate veteran and manager of the Coldwell Commercial Real Estate office in Glendale, agreed that office space is shifting east. But it’s “creeping,” he said, held back by the lagging economy.

An office building in Duarte would be a pioneering effort for a city with no other large office complexes. Thus, the city could end up struggling to find tenants and financing, Martin said, an assessment shared by John E. Alle, president of a Pasadena commercial real estate company.

“Duarte has no name recognition as do Pasadena and Glendale,” Alle added. Plus, many other cities besides Duarte have vacant land and offer to build to suit tenants, he said.

But Duff said Duarte is in no rush to implement its plan. “The tendency is to run out and get the land developed as quickly as possible,” he said. “We need to be patient.”