Morgan Hill
– Rabbits and burrowing owls living near the old Saint Louise
Hospital will have to make other arrangements if plans for a huge
shopping center materialize.
Morgan Hill – Rabbits and burrowing owls living near the old Saint Louise Hospital will have to make other arrangements if plans for a huge shopping center materialize.
The 66.5-acre property on the northeast corner of Cochrane Road and U.S. Highway 101, now growing crops and grapevines could be covered with 600,000 square feet of retail if a partnership between the Guglielmos – a Morgan Hill winemaking family since 1925 – and developers bears fruit
Plans show space for two “big box” stores, a movie theater, and pads for nine major stores and several smaller shops. Few details are available about which stores exactly the partners are targeting but developer Darryl Browman told the Chamber’s Economic Development Committee on Jan. 20 that a larger Target was in their sights, plus sit-down and fast food restaurants.
John DiNapoli of JP DiNapoli Companies Inc. in San Jose, said Thursday that they would like to include a grocery store and would be happy to provide Morgan Hill with its dream stores – Trader Joe’s, Whole Foods or another high-end grocery. No commitments have been made but DiNapoli said he was aware of the South Valley interest in such stores.
“We are diligently pursuing them,” DiNapoli said.
Such a large retail center would have three positive affects, said Mayor Dennis Kennedy: opportunities for new business, more sales taxes for the city and the chance to do more local shopping.
“We’re losing a lot of revenue … when Morgan Hill residents go to Gilroy or San Jose,” Kennedy said. “If there are more businesses here and if we can capture the revenue, it would help the city’s budget and be a real plus for the community.”
Finance Director Jack Dilles said that retail stores generally pay between $100 and $200 per square foot annually in sales taxes, depending on the type of store. The city gets about 1 percent of that. At 600,000 square-feet, the new center could generate between $500,000 and $1million, Dilles said.
The expected sales tax revenue for the 2004-05 fiscal year is $4.6 million.
Gene Guglielmo, one of three brothers who carry on their parents’ winemaking tradition, said the project was a long time coming.
“We’ve always wanted to do a joint venture there but it took 30 years for it to make sense,” Guglielmo said. “By joining hands with them (the DiNapolis), we’ll maintain a project that Morgan Hill, our family and the DiNapolis can be proud of.”
At 600,000-square-feet, the Cochrane center – unnamed at this time – would be more than twice the size of Cochrane Plaza across the freeway (275,000-square-feet) or Tennant Station (about 250,000-square-feet).
Other developers are working on a center directly across from Cochrane Plaza and are also eager to land the specialty groceries.
Tennant Station in southwest Morgan Hill has recently undergone a major overhaul, returning Safeway to the center and completely refurbishing the movie theater; three more screens are in the offing. Mike LaBarbera, a Tennant Station owner, said he didn’t want to comment on the new center just yet.
Kennedy said the new center will not necessarily have a “negative impact” on the others.
“This is similar to when K-Mart moved out (on East Dunne Avenue),” he said. “Home Depot moved in; this may open up possibilities.”
An environmental impact report is in the works and DiNapoli said he expects it to be finished sometime in the fall. At that point the partners will have to weigh the cost and trouble of mitigating the traffic, air quality and environmental impacts, plus the loss of prime farmland.
DiNapoli said they are planning to meet with residents of nearby Mission Ranch and Coyote Estates, new communities east of the property, with purchase prices hovering about $1 million each.
The project has been working its way through the city’s planning department at least since 2000 and arrived at the Architectural Review Board on Feb. 3.
“They liked it,” DiNapoli said. “We’re really excited about the project.”
