Despite Growing Vacancies, Economic Advisers See Promise in Future of Rohnert Park

City is currently seeking a permanent economic development manager, expected to be hired within three months.

As Rohnert Park struggles with 10.2 percent unemployment, a record high commercial vacancy rate and declining home values, economic development experts say it’s poised to outcompete the other eight Sonoma County cities in both residential and commercial real estate growth.

The reason they gave is simple: there's more space here.

“I think the whole country right now is going through the Great Recession,” said Ben Stone, the executive director of the Sonoma County Economic Development Board. “But I think Rohnert Park is well-positioned as the economy recovers — you’ve got a higher vacancy rate here, and that offers more opportunities to businesses looking to expand and relocate as well as more housing choices.”

“It fits the bigger picture,” Stone added.

According to numbers released last week by the county Economic Development Board, vacant office space here jumped to 43.4 percent in the beginning of 2010 from 15.3 percent just a few months previous; empty industrial space is at 11.6 percent and vacant retail is climbing from 10.8 percent. Those numbers don’t include the recently or impending closure of the 33-acre campus.

In addition, the city’s at a 10-year low in construction activity, the schools are seeing declining enrollment and only about half the population is employed (22,100, according to the report).

Whether it’s a toxic soup for economic development or an opportunity for a face-lift — well, that’s up for debate.

“It’s a real number, but it’s not a healthy one,” said Buck Oates, a former real estate developer in Rohnert Park who got his start with Jeff Sommers during the boom of Telecom Valley, mid-‘90s. “We need to operate on a 5, 10, 15 percent vacancy rate at the highest, or else it affects lease rates, unemployment and debt service needs.”

But one thing the city and local developers agree on is that Rohnert Park is well positioned in Sonoma County for a comeback.

“Rohnert Park has a lot in its toolbox,” Stone said. “When the Donald and Maureen Green Music Center becomes operational, that will create a huge economic boost for the city. It’ll expose a lot of people to Rohnert Park that wouldn’t see the city otherwise.”

Real estate experts said in addition to the Green Music Center, the city’s parks, , and the possibility of a can turn the city around.

And City Hall is currently seeking applicants for an economic development manager position, salaried between $7,500-$9,000 monthly.

“We’re beginning to see the seeds of recovery, but we still much work that has to be done,” said John Dunn, assistant interim city manager. “Recently we’ve taken the step to use a phased payment plan for high water users, like restaurants for example, to pay sewer connection fees.”

The city also recently has seen an uptick in interest from other business leaders about opening up or relocating to Rohnert Park, according to Dunn.

Dunn declined to talk about any of the deals.

“I can’t share the information yet on particular businesses because we’re still working with them,” Dunn said. 

Sonoma County Not Doing Much Better

A real estate report released by Cassidy Turley/BT Commercial, a Santa Rosa-based commercial developer, stated that in the industrial market countywide, "overall rental rate growth is unlikely before 2012, at the earliest."

Same thing with the office space outlook.

"Recovery will not be robust this year," the report stated. "It will likely be 2012 before we see significant declines in vacancy."

The retail sector doesn't look much better. 

Retail shopping centers countywide reached double digits in 2010, with 12.2 percent overall. Total empty square-footage in Sonoma County is about 5.5 million square feet, excluding malls. Asking rates for the county's empty space ranged from $11.88 per square foot, to $36.00, depending on geography.

SooQue March 10, 2011 at 05:18 PM
I am not sure that I like the idea of my tax dollars going to pay for a new, higher level Administrative position, when I just read how many teachers were recently laid off. Maybe these are different budgets, but it still bothers me.
Angela Hart March 10, 2011 at 05:24 PM
Thanks for your comment Susan. They are in fact different funds.
John Hudson March 11, 2011 at 12:08 AM
This morning I read an article in the PD which said that residential vacancies were 11% in Sonoma County. However, that number for Rohnert Park was less than 5%. I think that the residential real estate market is on or near the bottom at this time. Most people are too young to remember that general inflation is why residential real estate started having double digit rates of price appreciation in the 1970's. Guess what's back. Jerry Brown was governor then.
Angela Hart March 11, 2011 at 12:35 AM
Thanks for weighing in John.


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