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Impacts of theater closure on local business should be carefully assessed.

The proposed Residences at Berkeley Plaza at 2201 Harold Way would be the city’s largest private residential development with 302 units. It would also be downtown’s tallest building with 18 stories, reaching 180 feet.

A mechanical penthouse will bring it up to 194 feet. Only the campanile (Sather Tower) on the UC Berkeley campus would be taller.

Larger projects like this one make possible the provision of significant community benefits, but can also have impacts that are detrimental.

The site, which formerly housed Hink’s department store, currently includes Landmark’s Shattuck Cinemas movie theatres and the Habitot Children’s Museum and has frontage on Kittredge, Harold Way and Allston Way.

The Habitot Museum, which would be displaced by the development, has asked the developers for $250,000 of the estimated $1,200,000 they will need to relocate elsewhere in Berkeley. Over 50 residents have so far e-mailed the Zoning Adustments Board in support of this request.

The Shattuck Cinemas would close during the demolition of existing buildings and construction of the new 18-story building.

Under the developers’ plan, the current ten theaters would be replaced by six theaters with about 665 seats. The new theaters would feature stadium seating.

City staff should assess the impact that the closure of the Shattuck Theaters would have on local businesses in Downtown, particularly restaurants. 

The developers’ October 20, 2014 Community Benefits submission states that “the cinema currently grosses approximately $3 million per year….” (Page 22, footnote 11).  

Based on that figure, one could estimate that they sell 200,000 to 250,000 tickets a year. (Tickets are currently $8.50 bargain and $11.00 full price and purchases at the concession stand are presumably also part of the estimated $3 million) 

Some moviegoers are getting something to eat or having a drink before or after the movie. If there are 250,000 moviegoers, they might collectively spend well over $1 million a year at downtown restaurants during their trips to downtown to see a movie. 

Staff should talk to moviegoers and to business owners near the theaters to get a better sense of how much moviegoer business could be lost during the extended demolition and construction period that a large scale project like this will require. 

Because the Shattuck Cinemas show a broad range of films including documentaries and “art” films, and not just Hollywood blockbusters, they draw viewers from a broader geographic area than just Berkeley. 

Kelly Hammargen, who is among those working to make sure that the theaters survive, has spent a lot of time talking to moviegoers at the Shattuck Cinemas. She estimates that about 60% come from outside Berkeley. 

Many of these people would probably not be in downtown Berkeley at all if the Shattuck theaters weren’t there. When they go to a movie downtown, they pass other businesses on the way that may also benefit from their patronage. 

Theaters contribute to downtown vitality 

In addition, since most people go to the movies at night and on weekends, moviegoers contribute to downtown’s nighttime vitality. 

Berkeley’s downtown is in much better shape than it was 30 years ago, and the Shattuck theaters, which opened in 1988, have contributed to the improved atmosphere and greater vitality. 

More people downtown also make the downtown safer at night. During the closure, there will be several hundred fewer people downtown on any weekend evening. 

The Shattuck Cinemas now provide fully half of the movies screens downtown; its closure means that downtown will offer a smaller range of choices for moviegoers, with fewer of the kind of films that aren’t shown elsewhere in the East Bay. 

Community Benefits are Required 

The City should be telling the developer what community benefits it wants; and should not be letting the developer define and determine what the community benefits will be. 

Given the proposed height of this project, and that it would be one of only 3 taller buildings permitted in downtown under the downtown plan, the developer is required by the Downtown Plan to provide “significant community benefits…beyond what would otherwise be required by the City.” 

What would otherwise be required includes provision of public open space, an impact fee for open space, AC Transit bus passes for residents, a LEED Gold construction rating, and 10% affordable units (or an in lieu payment). The “significant community benefits” are in addition to things that are already required. 

To assess what is possible, the City needs much more information about this proposed project than what is currently publicly available. The developers should provide a pro forma. 

The Developers have reportedly not decided whether the housing will be rental housing or condos. 2211 Harold would have 76 studios, 145 one-bedrooms, 75 two-bedrooms and 6 three-bedrooms. 

The developers should provide information about proposed rents or the asking prices if they choose to go with condos. The whole process needs to be transparent, with adequate information provided. 

Fewer Theaters, Higher Rent 

The developers are proposing to reduce the numbers of movie screens from 10 to 6 and to charge Landmark 150% more per square foot in rent ($3.50 vs. $2.00 according to the developers community benefits submittal). 

Despite the reduction and higher cost, the developers nonetheless think that retention of the theaters should count as one of the additional required significant community benefits. 

Will the theaters be able to generate enough additional business in the reduced number of theaters to cover the increased rent? Is new stadium seating going to make such a huge difference to moviegoers? 

Shouldn’t the higher rent be viewed as detrimental and a threat to the survival of the theaters, rather as a benefit? How is reducing the number of screens a benefit? 

Given the theaters’ importance to downtown economic vitality, it’s essential that any deal assure the long term viability of movie theaters at this location. 

Faux Open Space 

The developers are also making the rather absurd claim that a recessed entrance to their building at the corner of Harold and Kittredge amounts to creation of a significant “privately owned public open space” and should also count as a significant community benefit. 

Real Community Benefits 

What significant community benefits should the City seek from the developer? 

Why not contribute to the creation of some real public open space that would benefit downtown residents and visitors? 

The City should ask the developers to make a contribution to the Streets and Open Space Improvement (SOSIP) fund equal to half the cost of creating a pedestrian plaza on Center Street between Shattuck and Oxford 

This would mean a contribution beyond the $491,251 that is required prior to consideration of the additional community benefits related to the building’s exceptional height. 

Real Open Space: Pedestrian Plaza on Center Street 

In 2010, the City Council approved the creation of a plaza based on designs of landscape designer Walter Hood, former Chair of the Landscape Architecture and Environmental Planning Department at UC Berkeley. 

Unfortunately, City staff have failed to come up with funding for the proposal to date, but with tall building projects planned downtown, the City now has a potential funding source that could help make the pedestrian plaza a reality. 

The City could ask the developer of the downtown hotel proposed for Center and Shattuck, which would also be an exceptionally tall building, to contribute the other half of the funds needed for the plaza. 

In the event that the hotel deal falls through, the contribution I am suggesting from 2211 Harold developers would fund at least a plaza in front of the UC art museum on the eastern end of the block. 

More Affordable Housing 

Last month, the city’s Housing Advisory Commission communicated to the Zoning Adjustments Board (ZAB) that it thinks that new high rises built downtown “must also provide additional affordable housing benefits”. 

The developers are required to either include 27 affordable units, which would be only 8.9% of the proposed 302 units or make a one-time payment of $7.25 million, which won’t build many affordable units. 

In November, the developers indicated that they would opt to pay the fee. Paying more than this minimal fee would certainly be a significant community benefit. 

A $300 million project? 

The developer may claim that they can’t afford to contribute more to help create a plaza or more for affordable housing, but this not a small project. 

When completed, 2211 Harold Way could be worth $300 million dollars. If they opt to rent the housing, rather than selling it as condos, the annual rental income from the apartments, commercial space and parking could exceed $10 million. 

City staff should come up with independent estimates of the project’s value and potential income before final decisions are made about community benefits. 

The community as a whole, represented by the Council and its appointees, should decide what community benefits the developer should provide based on a realistic and independent assessment of what the developer can afford to pay. 

The developers will of course be able to make a lot more money than would have been possible before downtown zoning was changed to permit 18-story buildings. 

An Obsolete Building 

With respect to energy efficiency, the developers’ preliminary LEED targets suggest that they will barely meet the LEED Gold green building standard. (62 points when the LEED Gold range is 60-79.) 

Basically, they will be doing little more than meeting the state’s current standards for residential construction. State plans call for a net zero energy standard for residential construction in 2020. 

If construction were to begin next year, the project would probably be finished in 2019, not long before the new standards are supposed to take affect. With respect to energy, the building would be obsolete from the moment it’s built, if it’s only built to the proposed 62 point LEED Gold standard.  

Do we really want the largest new development in Berkeley in years to be built to meet standards that will soon be out of date, rather than to standards that will actually help the city meet its Climate Action Plan goals in a significant way? 

Building something that is significantly more energy-efficient and that includes some significant on-site energy generation would be another real example of a “significant community benefit”. 

3 Levels of Underground Parking 

If costs of building green are a concern for the developer, then why are they proposing to build three underground levels of parking instead of two, given that underground parking will substantially add to the project’s costs? 

Two levels would provide sufficient parking for the residents and the Downtown Plan even allows for reduction in required parking if a fee is paid. The developers have suggested that they might provide some parking for the Shattuck Hotel. There is nothing “green” about doing that. 

Currently the site has only one curb cut, a service entrance on Harold Way. The proposed project would put a curb cut on Kittredge across from the library where the entrance to the subterranean parking would be. The more parking levels the greater the traffic impact will be near the library. 

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Rob Wrenn was a member of the Downtown Area Plan Advisory Committee.