So pride really does goeth before the fall. Last week, Doug Manchester took questions from the City Council about his vision for the Navy Broadway Complex, a 15-acre piece of prime waterfront real estate in downtown San Diego. He was asked whether delaying an impending vote of the Center City Development Corporation (CCDC) board of directors would hold up his plan to sign a lease with the Navy. According to a development deal between the city and the Navy signed in 1992, CCDC will determine whether the proposed project-a new Navy building plus hotels, condos and retail space-meets certain design specifications laid out in the agreement and re-ratified in 2003.
Manchester's oh-so-casual answer: “I expect we'll sign an agreement on the 27th or 28th.”
“What if CCDC hasn't voted yet?” asked City Councilmember Toni Atkins.
“We'll just set up a lease contingency,” he replied, suggesting that CCDC's approval was a foregone conclusion to be tacked on later.
Perhaps Manchester was trying to impress upon CCDC that his 3-million-square-foot project had unstoppable momentum. If that's the case, his plan backfired; the CCDC board read the comment to mean it could take its time voting on the project-a vote originally set for Sept. 27-since Manchester and the Navy could, it appeared, go ahead with the lease using a contingency. So, CCDC put off its vote. Instead, there will be an informational hearing to get two new board members up to speed.
In an interview with CityBeat, CCDC board chair Jennifer LeSar said, “I have not been informed that our process is tied with theirs.”
She requested a letter from the Navy explaining to CCDC the lease process. The letter had not yet been received as of press time.
In the meantime, the ever-litigious Manchester cannot be a happy man. His attorney, Steve Strauss, is among the more feared attorneys in San Diego (Council President Scott Peters said at the hearing, “We don't want to get that gentleman too much involved, if we can avoid it”). Strauss sent a letter to LeSar and CCDC President Nancy Graham saying Manchester was shocked to discover CCDC was not going to hold a vote at its meeting.
“CCDC misinterprets certain comments about ‘lease contingencies' at the City Council hearing on Tuesday. CCDC does so at great peril. There will be no contingencies if there is no lease,” Strauss wrote.
Of course, what Strauss means is that his client screwed up in front the council. Navy spokesperson Scott Sutherland told CityBeat, as other officials presumably said to Manchester, “We will not sign a contingency lease.”
The possibility of a lawsuit hardly fazes LeSar.
“Receipt of that letter from Steve Strauss does not change our going ahead with an informational meeting getting everyone up to speed on Manchester's plan,” she said. “I certainly hope that our board and our staff will act in a manner that puts us in a good position to defend any lawsuit that he may bring against us.”
LeSar must be aware of the power of delay. Until the hearing, conventional wisdom suggested the Navy and Manchester had until Jan. 1 to get a deal signed. But Bill Cooper, an aide to Rep. Duncan Hunter, appeared at the City Council hearing to say that the lease must be signed by the second week in October. It has to clear the various Navy reviews and go up the chain of command. Then it must endure a 21-day waiting period with the House Armed Services Committee, which Hunter chairs. So, if a deal isn't ratified by CCDC and signed in just two weeks, the Base Realignment and Closure process will take the project, and no one knows what would happen to the property then. It would disappear into what one City Council member called “the BRAC box,” and Manchester would be out the $3 million he has spent to prepare for this development. But Manchester's project has become so unpopular that everyone from community groups to Bob Kittle of the Union-Tribune favor the unknown of BRAC to the known of the Manchester Pacific Gateway.