With hopes that the worst real estate downturn would be over by 2012, the City is now hoping a third extension won’t be needed in 2015. According to the Sacramento Business Journal, the City of Sacramento will soon mull over another three-year extension of already obtained building entitlements that are soon set to expire. Staff from the Community Development Department is tentatively set to ask the City Council to approve the extension at its Jan. 24 meeting.
With hundreds of projects stalled throughout the city due to the real estate market collapse and the inability to achieve financing, this second extension just might be what the city needs when the economy improves. If these projects are still viable, they could be a few months from breaking ground because they would be considered “shovel ready.” Typically, entitlements can take 18 months or longer to acquire, this includes environmental, design and other approvals a project needs. Depending on the size of the project they can cost a few thousand to tens of thousands.In midtown, a project like the Tribute Building by Michael Heller Jr. at 20th Street and Capitol Avenue might still be doable if this extension is renewed. I would think that most if not all the proposed residential high-rise towers planned will not get built unless they received subsidies, like most of the current projects under construction in the grid. A second extension just might be what gets developers out in front when economic winds finally change.