A question just beginning to arise in northwest Bakersfield will eventually transform some of the area's top real estate: What do you build on a centrally located former industrial site surrounded by homes, stores and oil activity?
In the case of the former PG&E power plant undergoing soil cleanup along Coffee Road and Rosedale Highway, local government officials and people in the business say there are many answers.
As one of the city's largest “infill” real estate opportunities, the 150-acre site may accommodate various uses, pending more information from the owner such as what pieces of land will eventually be put up for sale.
Pacific Gas & Electric Co. said Friday it will begin the process by preparing the property’s northeast corner — across from stores and restaurants part of the Northwest Promenade — for some kind of commercial reuse.
Beyond that, the San Francisco-based utility hasn't expressed a preference for the larger site other than saying it wants the land to be compatible with the area.
“We are still in the early stages of planning and processes, which could take some time, but we will continue to keep the community informed as these efforts progress,” the company said in a written statement.
MANY POSSIBLE USES
Observers, meanwhile, say nothing's off the table for redevelopment the property.
Ideas voiced so far include retail and entertainment on the busy northern and eastern peripheries. For the interior and southern portions, they say, storage or light industrial might work — maybe even a park, apartments and homes.
Despite drawbacks not limited to the site's history and traffic circulation, the site benefits from its prime location. Retail does well nearby, it borders on some of the city's busiest intersections, and adjacent neighborhoods boast an attractive income, age and educational attainment profile.
"It could be anything," the City of Bakersfield's planning director, Jacqui Kitchen, said. "Now that (the PG&E power plant) is gone, it opens the door to a lot of new things."
How soon the PG&E land will be ready for redevelopment is unclear. The company recently began hauling away large amounts of soil believed to have been contaminated during decades of power plant operation. The company says it is unsure how much work will be necessary to finish the job.
The property's groundwater may be a separate question. There is believed to be a plume of contamination under the land originating off-site. That poses groundwater quality concerns but probably would not impede new construction tapping into Bakersfield's municipal water supply.
It is understood nothing will be built at the property until test results prove at least the underlying soil is clean.
The property “would have to have a clean bill of health by the County of Kern” before any lender will participate in the project, said Jeff Andrew, a commercial real estate broker whose office previously looked at the property on behalf of a Colorado biodiesel company that once considered buying the PG&E land.
Whatever is ultimately developed there will almost certainly help guide the reintegration of an area long frozen in time.
The industrial stretch along that part of Rosedale Highway reflects the northwest's development history. When little housing development existed west of Highway 99, the area was compatibly industrial. Not until much later did residential and commercial leapfrog the area, leaving behind an industrial pocket that now seems out of place.
PG&E’s more than 20-acre property, a former petroleum-fired power plant opened in 1948 and closed in 1985, lies directly north of a still-undefined project proposed by South Gate-based World Oil Corp. called Bakersfield Commons. It is tentatively talking about a wellness, dining and entertainment “lifestyle” center, the details of which are expected to be released later this month.
To the southeast of PG&E’s plant sits a refinery idle since 2012. While owner Dallas-based Alon USA Energy Inc. says it is exploring options on what to do with the unprofitable, 70,000-barrel-a-day plant, industry observers predict it will be dismantled and sold off in parts, leaving its next use open.
The area's redevelopment is by no means assured. Andrew noted Bakersfield's lack of physical barriers puts less incentive on redevelopment than is common in denser cities. What's more, industrial parcels just north of Rosedale Highway are small and individually owned, making large-scale redevelopment unlikely.
Whatever company ends up redeveloping the bulk of the PG&E property faces special challenges: the BNSF railroad along the property's southern edge, an electric power substation the utility will continue to operate on part of the property and, to a lesser extent, power lines over some of the land.
PG&E said it has ongoing discussions on the project with city staff.
“We continue to evaluate ways to ensure the property is redeveloped in line with the needs of the community,” it said.
Kitchen, Bakersfield's planning director, said talks with PG&E have been very preliminary, and that the company has basically expressed an interest in “potentially talking about in the future maybe selling the site for private development.”
She noted the property is zoned for industrial use, and so any other development would require changing the city’s General Plan. She said commercial development might be appropriate, and maybe storage, as well as possibly a sports facility.
The idea would be to find something that balances with the surrounding area, she said — something other than housing.
“I don't know that there'd really be opportunity for housing on this site, given its past uses,” Kitchen said.
The city councilman representing the area, Ward 4's Bob Smith, said he isn't ready to rule out housing or much else.
“It could go about anything,” he said. “It's prime real estate if you can clean it up.”
Smith said the important thing is that something be built there.
“You don't want those big holes continuing forever in the heart of your city,” he said.
Assuming the contamination can be addressed, the site will be put to reuse eventually, said Brad Cox, senior managing director at Trammell Crow Co., which is developing the adjacent Bakersfield Commons property.
“That's a great corner,” he said. “It's an opportunity to do something that’s very complementary for the neighborhood.”
He added World Oil is interested in what happens at the PG&E site and will track its development.
The highest and best use of some of the property’s frontage on Rosedale is shop space and maybe even entertainment, said retail specialist Vince Roche, Andrew’s business partner at Bakersfield commercial real estate brokerage Cushman & Wakefield | Pacific Commercial Realty Advisors.
Because the site has different pieces, Roche said, it can't be developed in a coordinated way, as envisioned at the Commons project to the south.
That doesn't mean there can't be single- and multi-family residential construction on the southern portion, north of that mini-storage and somewhere a park, Andrew added.
“It's a nice property even with its challenges,” Roche said.