Railyard SOTU

Mayor eyes next steps as commercial development phase on public/private project is nearly done

It's taken decades for the Santa Fe Railyard to move from a collection of repurposed warehouses in a dusty corridor to a sleek public space with new places to work, play, and see and do—most of it happening in just the last decade.

As the development phase for the city-owned land gets close to completion, Santa Fe Mayor Alan Webber is calling for a reconsideration he calls “Railyard 2.0.”

Webber tells SFR it would be a stretch to say he wants the city government to have more control over the Railyard in the near future, but what he wants is “more vibrancy” on the project. The city bought the 60-plus acres in the ’90s and hired a nonprofit to oversee development and avoid political conflict.
Now, Webber’s reminding people that he promised to get more out of all the city’s assets.
“I do think with a full-time mayor … we have an opportunity now to be much more directly involved on an ongoing basis rather than just having a city presence that is hands-off,” he says. “I see myself as an activist mayor, somebody who wants to be involved and creating things that benefit the community and participating in conversations about our economic development future. The Railyard, I think, is a key piece of our economic development strategy.”
Richard Czoski, director of the Santa Fe Railyard Community Corporation, points to an effort that endured a recession and still reflects what hundreds of people in Santa Fe decided they wanted. That includes a park and spaces for nonprofits such as Warehouse 21 and El Museo Cultural that avoid market-rate rents, plus a thriving venue for outdoor public events. 

SFRCC’s goal, Czoski says, was to bring the master plan for the space that came from a laborious, years-long planning process to fruition. And today, all but three of 42 commercial ground spaces are leased for projects whose managers in turn find tenants for their new buildings. Those that remain are under letter of intent.

“The state of the union of the Railyard is that it’s very near completion of the commercial portion of the development,” he tells SFR, noting that 2019 is on pace to see 58,000 square feet of construction. After that, he says, “the next big global event” will be a transition of the group’s role to management of the public events and common areas.

SFRCC has leased the city space through 2030. Already, payments to the city for its master lease have made good on the bonds issued to buy the property, and are now whittling down the loan on infrastructure to kick off the development. By 2030, the nonprofit's payments of about $1 million per year are expected to have erased all those debts and be contributing to the city coffers, Czoski says.

The biggest leap forward for the Railyard in recent years has been in housing. Not only is the new Railyard Flats apartment building full with a waiting list, but several projects underway in both the Baca Street and North Railyard sections also have residential components. In addition, several new projects are set to offer small spaces for food and retail-oriented uses.
“We really haven’t had the product,” Czoski says. “But there are more small businesses in Santa Fe than there are big businesses, and the sweet spot is probably 500 to 2,000 square feet.”

The problem child is the Market Station building. The spot that's supposed to be the anchor of the Railyard is responsible for 90 percent of the Railyard's 7 percent overall vacancy rate in completed buildings, he says. The building came through a bankruptcy and has for the last year been owned by a California firm which recently retained a new local leasing agent.

Because the master plan gives preference to local tenants, the SFRCC board of directors can veto prospective users.  To date, however, it has approved more than 70 subtenants for the spot, and Czoski says it's not clear to him why the building remains unleased.  He acknowledges those empty storefronts leave a poor impression.

"I think it is a question of perception," he says, "and the perception of much of the public is that the Railyard is not fulfilling its potential or has been a failure in some respects.  And I think the perception depends on what your point of view is about what the Railyard should be. Should it be what is envisioned in the master plan, or should it be a vibrant commercial center like Albuquerque Uptown? The Railyard was never meant to be Uptown."

Some onlookers who are more closely following the project say it's an exciting time.

"I am feeling more optimistic than I ever have," says Cyndi Conn, director of Creative Santa Fe, a nonprofit that has worked on walkability in the downtown area, among other initiatives. "I feel like the area is becoming what we wanted the city downtown vibrancy to look like. It has really become something that locals live in and take pride in an walk around in."

Although Webber late last year suggested some new board members for the independent nonprofit and none of those people were subsequently invited to join the board, the mayor tells SFR he doesn't have a quibble with the way the corporation is fulfilling the plan.  He noted the city Economic Development director has scheduled a "visioning meeting" with principals later this month. While that won't be a public session, he says it's not intended to move toward renegotiating the agreement with the nonprofit or changing the "local preference clause"—at least for now.

“I think what we need to do is examine how the local preference works,” he says, “and get more data of what options have been ruled out because of a local preference, and where would we want to find more flexibility.”
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