As part of a consultant team to the County of Sonoma, KMA evaluated market opportunities for the redevelopment of the 945-acre Sonoma Development Center (SDC), evaluated the financial feasibility of the redevelopment plan (which was based on KMA’s market assessment), and prepared a financing plan for the project. The SDC formerly housed developmentally disabled persons and includes over 1 million square feet of existing buildings, many of which are historic structures.
KMA’s work effort entailed:
- Evaluating regional population projections and the likely share that could be captured by the site over the next 20 years
- Evaluating retail, hospitality, office and industrial market conditions and opportunities for the site
- Assisting D&B formulate draft development program scenarios for the reuse of the existing buildings and new development
- Preparing pro forma models of several alternative development programs, which estimated infrastructure and vertical construction costs, sales revenues, rental income, supported investment and a comparison of supported investment to development costs.
KMA’s analysis concluded that the project is economically challenged. KMA then examined the potential value that could be created through the use of several public financing tools, including:
- formation of a CFD on for-sale homes, with revenues to be used to fund infrastructure,
- historic tax credits, low-income housing tax credits, and the formation of an Enhanced Infrastructure Financing District.
The findings of the analysis indicated that the use of the CFD, historic tax credits and low-income housing tax credits alone would likely generate sufficient revenue to render the project feasible. And, the EIFD could be very helpful to fund additional public amenities.