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California City Solutions: Mixed-Use Historical Development Brings Arts and Entertainment District to Downtown Vallejo

March 13, 2015
This story is part of an ongoing series featuring Helen Putnam Award entries.
 
The 2014 entries are available on the League’s website as a resource for cities in a searchable database called California City Solutions. Vallejo’s Temple Art Lofts project was submitted in 2014 for the Housing Programs and Innovations award category.Vallejo-Temple-Art-Lofts-outside.jpg
 
The city of Vallejo has a long and diverse history. It served as California’s first state capital in the mid-19th century, a cornerstone of maritime history at the Mare Island Naval Shipyard, the U.S. Navy's oldest West Coast (closed in 1996) and home to a vibrant music community in the mid-to-late 20th century. Even under significant financial distress, Vallejo saw an opportunity to invest in its historical assets and boost its economy by developing the Temple Art Lofts.

In recent years, the city struggled with record-high foreclosure rates, high crime rates, and high commercial vacancy rates — especially in its downtown. In 2008, the city filed for Chapter 9 bankruptcy protection, emerging in late 2011. After filing for bankruptcy, two of the city’s most historical buildings fell into foreclosure, prompting the city council to approve plans to create a mixed-use development and foster its growing arts district.
 
Vallejo selected a development company to transform the foreclosed-upon landmarks, its original City Hall, built in 1872, and the Masonic Temple, built in 1917. Urban issues plagued the infill project. Security coverage was needed 12 hours per day because of frequent theft prior to the start of construction. The long-vacant building was dilapidated and home to squatters, thieves and vermin. It took more than two yearsVallejo-Temple-Art-Lofts-entry-before-and-after.jpg to develop a viable parking strategy that met planning, financing and neighborhood requirements.
 
Neighborhood residents expressed concerns about adding more affordable housing in the downtown area, which already had a high percentage of such units. There were also concerns about the artist-preference, and the effect the project would have on economic development.
 
During construction, a number of unforeseen and unique issues resulted in change orders totaling $1.5 million — 19 percent of the total construction budget. Temple Art Lofts project also had the most complicated financial structure in the developer’s portfolio.
 
The historic preservation component of this project required the city to address preservation of a number of spaces that produce no income, including the grand performance hall, historic jail, oversized staircase, bank vault, and other areas. The project was incomparable to any of the city’s other affordable housing ventures.
 
The large scale of historic preservation and reuse of the existing building made the task complex. City staff conducted a multipart environmental review of each property, requiring consultation and approval from the State Office of Historic Preservation, Advisory Council on Historic Preservation, Vallejo Architectural Heritage and Landmarks Commission and the U.S. Department of Housing and Urban Development. Bringing the building up to code required structural and seismic upgrades, new foundations, new transformer vault, installation of an oversized elevator, creation of Americans with Disabilities Act-compliant entries, abatement of lead and asbestos and upgraded mechanical, electrical and plumbing systems.
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The building had ample damage and repair issues, like a broken sub-pump system, through which groundwater leaked into the basement, and a partially collapsed roof. At the same time, the contractors had to preserve the historical Vallejo-Temple-Hall-before-and-after.jpgarchitecture. Original wood windows were preserved and outfitted with new panes that were safe and functional, while upgrades to structural improvements, such as metal brace forms, were concealed.
 
A combination of financing brought the Temple Arts Lofts to fruition. Alliant Capital provided more than $5 million in combined equity for both Low-Income Housing Tax Credits and Historic Tax Credits, while U.S. Bank provided $7 million in the form of a construction loan and Tax-Exempt Bond Financing. The city made a significant investment, too, contributing more than $5 million directly or indirectly. The city also made use of more than $1.3 million in HUD Neighborhood Stabilization Program funds, nearly $1 million loaned from Community Development Block Grant and HOME Investment Partnership programs and $2.5 million combined in Tax-Increment Financing from Vallejo and Solano County. The Vallejo Redevelopment Agency provided a loan of $750,000 for the purchase of the buildings and initial rehabilitation costs. Additional financing was made possible through an impact fee loan and a deferred-developer fee.
 
Completed in April 2013, the restoration played a critical role in the revitalization of Vallejo’s downtown waterfront area and its growing Arts and Entertainment District. The adjacent Empress Theatre also underwent a comprehensive renovation. It has not yet attracted the type of increased patronage the city envisioned, but the neighboring Temple Art Lofts are expected to increase foot traffic and activity in the emerging Arts and Entertainment District.
 
Vallejo-Temple-Art-Lofts-Ribbon-Cutting.jpgVallejo celebrated the completion of its decorative streetscape improvements during the same week as the ribbon cutting ceremony for Temple Art Lofts. Since then, Loft residents have championed the renovation of the nearby historic Odd Fellows building — with the goal of including art-serving retail — and become leaders in a program placing art in downtown Vallejo storefronts. The Temple Art Lofts project has helped revive the once-depressed downtown of a city hit hard by the Great Recession.
 
A hallmark of Vallejo is its rich racial and ethnic diversity, and that is reflected in the creative residents of Temple Art Lofts. Residents have access to individual spaces in the 2,280-square-foot community art studio and the 2,590-square-foot performance hall, which has hosted events such as art shows, a reggae singer and a gospel choir.
 
The project has earned a number of awards, including a Preservation Design Award from the California Preservation Foundation. The National Housing and Rehabilitation Association selected it as a finalist for the J. Timothy Anderson Award for Most Advanced Financial Structure. These and others have singled out Temple Art Lofts because of the significant impacts the project has made on Vallejo during its rise from bankruptcy and the depths of the Great Recession.

 


 
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