Proposed shopping center to create 500 jobs

A proposed shopping center in Petaluma anchored by a Lowe's home improvement store would create more than 500 permanent jobs and generate nearly $1 million a year in tax revenue for the city, according to a City Hall analysis.

The construction of Deer Creek Plaza Village adjacent to Highway 101 on McDowell Boulevard at Rainier Avenue also would result in the loss of about 50 existing jobs.

The findings made in the city's second economic analysis of a big-box proposal in less than a month appear to show that the 315,000-square-foot shopping center would be good for the city.

"At a time when many employers are either going out of business or laying off employees, Petaluma is in the unique position to create new jobs and protect its economy," said Greg Geertsen of Merlone Geier Partners, a San Francisco development firm.

Lowe's has not committed to the deal, but has been working closely with developers on the project for months, Geertsen said.

The company also is seeking approval for a store in Santa Rosa and has an existing one in Cotati -- less than 10 miles from Petaluma.

Lowe's spokeswoman Maureen Rich said Thursday it's not uncommon for the firm to build stores near each other and bases decisions on market research, studying such factors as homeownership. She said 78 percent of Lowe's stores are within a 10-mile radius of their biggest competitor.

She would not say whether the company will open in Petaluma.

"It's our policy not to comment about specific sites Lowe's may be considering unless we have closed on all real estate matters," she said. "We have not done that in Petaluma."

The city's analysis of Deer Creek was prepared by an independent consultant, fulfilling new city development requirements. The same consultant prepared a similar report for the proposed Target shopping center on East Washington Street.

The city has not approved either project.

According to the analysis, Deer Creek Plaza will create 510 retail, office and services jobs and 331 temporary construction jobs. The city will receive $681,000 in annual sales tax revenue and $311,000 in annual property tax revenue. It will also get millions of dollars in development fees related to the project.

In addition, the center will help capture some of $83 million in retail purchases made by Petaluma residents in neighboring cities.

Lowe's is expected to have gross annual sales of about $40 million, the same as predicted for the Santa Rosa store, Geertsen said. Other tenants, including two restaurants and smaller stores, will do another $40 million, he said.

After completing other city requirements this spring and summer, including a possible City Council hearing, the company hopes to begin construction by February, Geertsen said.

Concerns about the project focus on traffic congestion and its proximity to the flood zone. Some opponents have expressed reluctance to embrace big-box developments that could hurt existing businesses or provide low-wage jobs.

"The question is: Is the city going to move expeditiously or are they going to drag their feet?" Geertsen said.

Staff Writer Paul Payne can be contacted at 762-7297 and paul.payne@pressdemocrat.com.