Title
Warehouse and Threatened Building Grant for Western Wholesale Drug Company Warehouse (Ordinance S-45455)
Description
Request to authorize the City Manager, or his designee, to enter into necessary agreements and conveyances with Klanco LLC related to a Historic Preservation Warehouse & Threatened Building grant of up to $100,000 for the Western Wholesale Drug Company Warehouse, located at 101 E. Jackson St. Further request authorization for the City Controller to disburse all funds related to this item. The Project will have no impact on the General Fund.
Report
Summary
The Western Wholesale Drug Company Warehouse was constructed in 1925. The reinforced concrete and red brick building was constructed by contractor T.B. Stewart, who specialized in “fireproof construction.” The building is one story in height with a full basement. It served as a regional distribution point for drugs, medicine and liquors, first as part of a California-based corporation and then as a subsidiary of the national McKesson Corporation. In 1966 the building was remodeled and turned into the Crown Lace and Notion Company, later organized as the Klanco Investment Corporation. In 1998 it was remodeled and turned into a music and sports-themed restaurant and bar known as "Alice Cooper’sTown." The restaurant/bar closed in 2017.
Klanco LLC, which still owns the property, recently rehabilitated the warehouse for office use. The building is now occupied by HealthBI, who moved into building in late 2018. HealthBI is a division of Equality Health, an Arizona-based company focused on improving health care delivery for underserved populations; their main office is in the historic Graham Paper Company Warehouse at 521 S. 3rd St.
Klanco LLC is seeking funding assistance for work already completed as part of the rehabilitation. Because Historic Preservation bond funds are not available, staff is recommending that Community and Economic Development Department (CEDD) funds be used instead. CEDD funds are appropriate for this project as it has resulted in job creation and the property is located in the Downtown Redevelopment Area. However, only $100,000 in CEDD funds are currently available. The $100,000 in grant funds will be disbursed to the applicant as evidence is provided of work completed.
Financial Impact
The Project will have no financial impact to the General Fund. The amount requested for the Warehouse and Threatened Building grant is $100,000. The total project budget is approximately $2.02 million. The applicant will be required to provide a dollar-for-dollar match, which may include exterior work items as well as items not typically eligible for Warehouse & Threatened Building grant funds, such as plumbing, electrical, mechanical, interior or site work. In exchange for the grant funds, the city will receive a 25-year conservation easement on the property. The conservation easement will require the property be preserved and insured it will be maintained in good repair. Funds are available in the Downtown Community Reinvestment Fund.
Concurrence/Previous Council Action
The Historic Preservation Commission recommended approval of this item on Feb. 11, 2019, by a vote of 6-0.
This item was recommended for approval at the Planning and Economic Development Subcommittee meeting on March 13, 2019, by a vote of 4-0.
Location
101 E. Jackson St.
Council District: 7
Department
Responsible Department
This item is submitted by Deputy City Manager Mario Paniagua and the Planning and Development Department.