There’s a new plan in the works for two long-vacant buildings anchoring Paseo Nuevo in downtown Santa Barbara, in a shift that could bring up to 600 employees to the empty Macy’s building and 112 units of housing to the Nordstrom property, if negotiations work out over the next few weeks.
After the previous proposal for a grand rehaul of Paseo Nuevo was put on hold indefinitely, the multiple parties sharing ownership of the downtown mall pursued alternatives, with the latest viable option coming from longtime Santa Barbara–based real estate software company Yardi Systems, which is looking to move its corporate headquarters into the Macy’s building on the corner of Ortega and State streets.
Ben Romo, a spokesperson for Yardi Systems, confirmed that the company is “exploring an adaptive reuse” proposal for the building, though he said the deal was still in negotiations and he could not provide details until all parties came to agreement.
“We are pursuing this because we think it has the potential to be a good thing for downtown,” Romo said. “We think it’s a good thing, but we only want to do this if the city and community agrees that it’s a good thing.”
Romo said Yardi Systems is proud to be founded and based in Santa Barbara and that the company has a “long history of putting community interest at the top of their consideration,”
“This is the company’s home,” Romo said. “The company’s mindset is what it always is: taking care of employees and taking care of the community.”
City Administrator Kelly McAdoo confirmed that a deal to bring the Yardi Systems headquarters downtown was “in the works” and said the proposal could potentially be introduced at the same time as a 112-unit housing project intended for the Nordstrom building at the other side of the mall.
The proposal would require the approval of all parties, including Yardi Systems, the city, AB Commercial (which owns the Macy’s property and most of the mall improvements), and Shopoff Realty Investments (which owns the Nordstrom property in partnership with Praelium Commercial and Dune Real Estate).
McAdoo expressed optimism about the direction of negotiations and said a deal was “fairly close” and could be reached within the next couple of weeks. Any change of use would require City Council approval before the deal is finalized.
While the new vision for Paseo Nuevo is a departure from the previous proposal — which could have brought more than 250 units of housing to the Macy’s property — McAdoo sees the move as an investment into the future of downtown.
“It will be just a huge benefit to downtown, and I think it really will be a catalyst,” McAdoo said. “It will start to unlock investment in other parts of downtown. We are beyond thrilled that Yardi is considering this.”
There are still several pieces to be worked out, but the current proposal could result in a joint proposal for a change in use allowing Yardi System’s new headquarters at Macy’s and 112 units of housing at Nordstrom, with 10 percent set aside as affordable units. Yardi Systems’ move out of its current headquarters on Fairview Avenue could also potentially clear the path for an additional reuse project in Goleta.
