Santa Rosa staff pitches property-exchange to redevelop 7-acre City Hall campus

City staff presented a plan for redeveloping a 7-acre City Hall campus in downtown Santa Rosa by exchanging the civic property for an existing building that the city could adapt into a modern, centralized service hub.

Jill Scott, the city's real estate manager, framed the proposal as a way to remove the city's aging capital burden and "unlock this economic engine" downtown. "We are sitting on 7 acres 7 acres in our downtown core of prime real estate," Scott said, adding that the campus currently houses about 350 city employees and carries years of deferred maintenance. Scott told council the immediate cost to keep the existing buildings operating is roughly $48 million, with total life-cycle needs potentially rising above $100 million.

Staff described a "property-exchange" approach: the city would declare the civic parcels exempt surplus under the California Surplus Lands Act and swap them with a qualified private developer for a modern office building where the city could consolidate services. Scott said the exchange would avoid large capital outlays to rebuild City Hall and transfer redevelopment risk to a private partner while allowing the former civic site to be redeveloped for housing, retail and other uses that could generate downtown spending.

Scott Adair, the city's chief economic development officer, presented a fiscal model for a prototypical mixed‑use redevelopment on a portion of the 7 acres. Using conservative assumptions, Adair said the modeled project could generate $1.6 million to $1.8 million in direct, recurring revenue to the city and $8.4 million to $9.3 million in downtown spending annually. "These revenues would occur year after year and could be reinvested into public services, infrastructure, parks, public safety, and other initiatives of the city," Adair said.

Council members sought more detail on guardrails. Councilmember McDonald asked whether the new civic facility must be located downtown and whether staff had considered buying an existing building outside the core. Scott replied the plan places value on keeping 350 city employees downtown to support local businesses, but acknowledged a property exchange means the city would lose direct control of the redevelopment and that any guarantees would have to come through selected development agreements and inspection periods.

Several council members and residents raised concerns about affordability and displacement. Public commenters and housing advocates urged the council to preserve a creek corridor, protect trail and environmental connectivity, and pair any market-rate development with inclusionary affordable units and broader housing strategies.

Council did not take an immediate vote on a particular exchange agreement. Staff said the next steps would include the budget process to set aside planning funds, followed by analysis and potential proposals later this year. Staff emphasized that any exchange would be selective and require a trusted development partner and that a development agreement could include time-limited obligations to encourage timely building and delivery.

What happens next: staff advised that council could pursue a property-exchange proposal this summer or fall, and that proposed terms and site-specific analysis would return to council before any transfer of property.

Speakers quoted: Jill Scott, city real estate manager; Scott Adair, chief economic development officer; Gabe Osborne, planning and economic development director.

Ending: Council left direction for staff to continue the analysis and to return with specific proposals and fiscal details before any final action, while several council members urged detailed protections for affordability and creek preservation.