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Historic site to get facelift, retail tenants

Old Police Headquarters to become shopping, tourist attraction

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The buildings that sat empty after the crunching boots of policemen left the premises will now see a different kind of foot traffic – that of shoppers, when the historic Old Police Headquarters is transformed into a mixed-use retail space.

Built in 1939, the Old Police Headquarters sits on 21 acres in the South Embarcadero area of downtown San Diego, between Kettner Boulevard and Pacific Highway.

It has been vacant since 1987 when the San Diego Police Department, which had outgrown the building and needed a larger, more modern structure, moved to a new building.

It is part of a larger Port of San Diego project to redevelop the historic downtown harbor front.

Built in 1939, the Old Police Headquarters is considered one of the city's architectural jewels with its eclectic mix of design styles.

Old Police Headquarters consists of several linked buildings with more than 100,000 square feet, which used to be the former jail, processing area, administration and police offices, assembly area, gym, food service, auto repair facility and courtrooms.

Its architectural style reflects an eclectic combination of Spanish Colonial Revival and Classic styles that led to its being listed on the National Register of Historic Places in 1998.

Plans to rehabilitate the rundown Old Police Headquarters call for mixed-use, with retail stores, restaurants and entertainment.

The Port issued the lease option to Terramar Retail Centers in 2005, which was chosen from a pool of applicants. The privately held 15 year-old Carlsbad company focuses on retail projects in the Western part of the United States and has a portfolio of 20 properties with more than 3.7 million square feet.

Financing bottlenecks due to the sluggish economy held up the project, but it has received plan approval from the Port and a building permit from the city.

The project has a budget of $40 million and will be overseen by the Port, with Terramar as the operator.

Terramar's lease, which has since been renewed, expires at the end of this year. The construction deadline for the project is 18 to 24 months from when it enters the lease. It has already done about $1 million worth of work on the interior.

"We hope to start construction at the end of 2011. We're focused on leases, which will lead to financing. It's not a bottleneck at this point, it's more a domino effect. If the tenants are available, then financing will click," said Alexander Liftis, senior vice president of development with Terramar.

He estimated this would be a 30 to 40 tenant project, but said they would not need to get all of the tenants, just the key tenants before they can go forward.

A rendering shows plans to develop the historic Old Police Headquarters near Seaport Village into a new retail destination. Image courtesy Port of San Diego

This is a build-to-suit project with some unique challenges. Being a historic site, Terramar will focus on improving it but will not modify the basic structure, which means working around some issues.

Typically, retailers like street front space, but here they will face a courtyard, since the buildings are constructed around a quadrangle.

Also, retailers will have to design their space around the building's unique features. One space is 17,500 square feet long.

"So we either find a tenant who will need this much space or we subdivide it, but it's not easy to do. Some spaces are 9,000 square feet, but there are structural walls in the middle they'll have to work around," Liftis said.

There will be no street front signage and there are limitations on the kind of signs that can be put up, so it does not take away from the architectural style.

The design mirrors Spanish mission-style with an open floor plan encouraging circulation and traffic flow. Terramar touts the unexpected mix of styles, including Classical Revival, Churriqueresque, Spanish Colonial, Mediterranean Revival, and Pueblo Deco, as "conjuring the magic of a romantic Mediterranean getaway."

Liftis said there is a lot of interior work to be done, much of which will depend on tenant requirements. There's also a lot of site work, including reconfiguring utilities and the parking lots. So far, water, power and gas lines have been redesigned.

There is a 20 percent tax incentive for restoring historic sites but he said in order to qualify for it, the lease holder would have to adhere to many conditions and some tenants may not be able to do so, so Terramar was not counting on that money.

Terramar purchased the lease hold for Seaport Village in 2003 and part of its strategy was to enhance the area and extend it by redeveloping Old Police Headquarters.

Liftis recalled it was an elaborate process, involving requests for proposals (RFP), multiple bidders and intense competition to rehabilitate the Old Police Headquarters.

"The port wanted a Ripley's Believe It or Not, but we proposed a retail space," Liftis said. "We're working hard to get the right kind of tenants. We think it's going to be an iconic destination in the waterfront and downtown area. Combined with Seaport Village, it will be a huge draw."

Nagappan is a San Diego-based freelance writer.

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