San Diego suing to own Fashion Valley, Hazard Center parcels – The San Diego Union-TribuneFashion
With negotiations at an impasse, San Diego will forcibly try to take over the Fashion Valley Mall and Hazard Center parcels in Mission Valley that it needs to complete an important water pipeline.
Tuesday, City Council members voted unanimously to authorize eminent domain litigation against the property owners, Simon Property Group and Hazard Center LLC, which have so far rejected offers from the city to pay what an appraiser has deemed fair market value for the land in question. The legal action is necessary to complete the Alvarado 2nd Pipeline Extension project, the council members determined.
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The pipeline project includes the replacement of around 10 miles of 24-inch and 48-inch water mains, primarily in the Friars Road right of way, between I-805 and Sea World Drive. The new pipeline would act as the primary water feed to La Jolla and Pacific Beach, and relieve an aging Kearny Mesa pipeline, city staff said in a report to council members.
“This is a key infrastructure project that is integral to our city’s efforts to strengthen the resiliency of our water utility,” said Councilmember Raul Campillo, whose district includes Mission Valley. “The project schedule would be severely impacted if we were not able to move forward in accessing these easements. So with that (in mind), this action today, I believe, will result in the least private harm and the most public good.”
San Diego will now move forward with an eminent domain claim for two water easements and two temporary construction areas near the southeast and southwest boundaries of Fashion Valley Mall.
In January of 2021, the city first offered to pay $1.17 million to buy the 27,748 square feet of land it needs for the pipeline, as well as accommodate Simon Property Group for the loss of 275 parking spaces during construction, based on a November 2020 appraisal by Anderson & Brabant, Inc. A final offer with the same terms was made in April of 2021.
At Hazard Center, the city wants to take over a 6,400-square-foot portion of an undeveloped lot along Hazard Center Drive that abuts SR-163 and has been contemplated in the past as a public park. In January of 2021, San Diego offered the property owner $53,000 for the parcel, based on a November appraisal by Anderson & Brabant, Inc. A final offer with the same terms was made in April of 2021.
To date, neither property owner has provided a counter appraisal or attempted to negotiate a higher sale price, Deputy City Attorney Jenny Goodman told council members.
Lawyers representing the property owners did not respond to a request for comment. In letters delivered to council members ahead of Tuesday’s meeting, the lawyers challenged the city’s assertion that it met the legal requirements to adopt a resolution of necessity, as is required to pursue an eminent domain claim. They also contested the appraised valuations.
There appear to be other motivations in play.
Kelsey Mills, an attorney with Allen Matkins who represents Hazard Center LLC, told council members on Tuesday that the operator of the 135,949-square-foot, mixed-use center, constructed in 1989, is concerned about the impact of the water easement on a previously entitled redevelopment project.
In May 2010, City Council approved the discretionary permits required for Hazard Center to redevelop a portion of its 7510 Hazard Center Drive property with 473 residential units, and 4,205 square feet of retail and restaurant space. The project also requires the developer to build a 0.63-acre public park on the site the city is now trying to buy.
Although more than 12 years old, the entitlements were vested and have not expired, a spokesperson for San Diego’s Development Services Department said.
The water easement, as proposed, would restrict the land owner from making grade changes or planting trees across the city’s water facilities, Mills told council members. As such, the restrictions, she said, greatly limit her client’s ability to build a city park on the easement site, as is required if Hazard Center moves forward with its redevelopment.
“We need to have guarantees from the city that the easement itself would be revised so that 7510 Hazard’s entitlements will not be impeded in any way,” Mills said.
Opened in 1969 and expanded in 1981, Fashion Valley Mall sits on nearly 64 acres of land that is valued at $222.6 million, according to the Anderson & Brabant appraisal. Roughly 15 acres on the western side of the property is zoned for high-density residential use. However, the city is seeking to acquire land that is already encumbered, in part, by easements that prevent structures, the appraisal said.
With council approval, the City Attorney’s Office will now prepare eminent domain complaints, which are expected to be filed within a month. The proceedings could take anywhere from several months to a year, or longer, a spokesperson for the office said. Even if successful in court, the city will have to compensate the land owners for the fair market value of their property, as required by eminent domain law.
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