The future of commerce in Sonoma?
The City of Sonoma is in the middle of rewriting its General Plan, the document that sets out a vision for Sonoma and ways to achieve it during the next twenty years. One portion of the plan deals with the local economy, including sales tax generators, hotel tax producers, employment, and the vitality of the commercial sector overall.
Commercial activity in Sonoma is of two basic types, (1) service providers such as banks, fitness centers, restaurants and tourist-serving businesses like hotels and tasting rooms, and (2) retailers of hard goods such as gifts, groceries, office supplies, hardware and automobiles.
According to Ryan Snow, a commercial realtor in Sonoma for over 20 years, the momentum is towards businesses that are service-oriented. “Looking ahead 20 years, the small town reality is against hard good retailers,” he predicts. “However, there are things you can’t buy online, and people will still want to get together for wine and cupcakes,” he adds.
Citing cities like Healdsburg, Napa and Carmel, Snow points to how service-related development is happening there as a glimpse into Sonoma’s commercial future. His concern is that too many use restrictions on land-owners creates vacancies and blight. “If too many uses are not allowed or if regulations are too tight,” he notes, “properties sit empty.”
As an example, Snow mentions the former U.S. Bank on Fifth Street West across from Safeway, now vacant (shown above). Built 50 years ago and exclusively used as a bank during that time, the long-time owners are having difficulty finding a tenant. “Any building permit valued at over $150,000 to renovate that building triggers ADA compliance issues that total over a half-million dollars.”
That brought us to the topic of banks, of which the city has many, and all in prime locations on major transportation corridors. Banks and their parking lots are mostly empty; people have transitioned to online banking for virtually everything, even check deposits. Bank of America is closing some branches, in Sacramento for example, and how such properties will be used over the next twenty years is a topic of consideration.
The State of California now allows housing to be placed on commercial parcels, something the City of Sonoma has permitted for the past 20 years. For development on commercial parcels over 1/2 acre in size, the city requires 50% of the footage to be used for housing. Does this mean all these empty banks might be replaced or supplemented with some housing? Not necessarily. “Banks move at a snail’s pace,” says Snow.
When it comes to the conversion of commercial space to residential, he notes that it is happening, but at a small scale. “Some commercial office spaces within Sonoma Court Shops have transitioned to residential. Conversion of large-scale commercial to residential has not been typical.”
Snow advises that the city explore ways to help emerging forefront businesses. “Each commercial parcel has its own particularities,” Snow points out, “and a change of use to residential prompts unintended consequences. Success requires expertise and persistence,” he adds, “just look at the old Truck and Auto lot.”
Report by Larry Barnett
3 thoughts on “The future of commerce in Sonoma?”
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We haven’t heard what MacArthur place plans to do with the lot that use to be Sonoma Truck and Auto since it was sold to New owners. I imagine they will expand adding more rooms that go for over $500 a night.
The Truck and Auto lot remains in the ownership of Lat-33, the separate company associated with JP Morgan Chase that sold MacArthur Place recently to Foley enterprises. Plans for the parcel are at this time unknown.
$500/night rooms are good for Sonoma…TOT money coming in to the city.