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SEPTEMBER 30, 2004

Small Businesses Revitalize Fourth Street and, Perhaps, West Berkeley

The Daily Californian

Once the hub of an industrial infrastructure that extended from Hayward to Richmond, Berkeley's Fourth Street has become a haven for posh boutiques and high-end shops. Industrial facilities and smoldering smokestacks have been replaced with new emporiums. 

The transition from industry to retail began nearly 30 years ago, but has taken off in the past 10 years with the implementation of the 1993 West Berkeley Plan, which outlined the city's vision for developing the area. 

The West Berkeley Project Area Committee is now reviewing the accomplishments of the plan and today will unveil its new proposals for the area for the next five years. 

"The days of saw mills and bleach factories are gone, and even if high-tech manufacturing is a possibility it is not very ecologically sound," says Bart Seldon, a member of the committee. "Just look at the South Bay." 

The multimillion-dollar development project, from the city's perspective, has paid off. 

Fourth Street is the only commercial sector in the city to draw sales tax revenue into Berkeley's coffers, according to Berkeley's Office of Economic Development. 

Other parts of the city are draining Berkeley's cash-strapped treasury. 

The quarterly sales tax revenue is driven by consumers from all over the Bay Area who travel for the big-ticket shopping. 

"The development of Fourth Street is positive for Berkeley's economy," says Thomas Myers, the city's acting manager of economic development. "You have shoppers visiting from all over the Bay Area because there are unique shops you can't find elsewhere." 

Model for West Berkeley 
But other parts of West Berkeley haven't fared as well. 

The neighborhoods surrounding Fourth Street lost nearly $600,000 in quarterly sales tax revenue from 2002 to 2004, according to the economic development department. 

Berkeley is looking to Fourth Street as a model for removing the crumbling facades of defunct industry and empty lots from all of West Berkeley, which spans from University Avenue to Cedar Street. 

The draft of the West Berkeley Redevelopment Area five-year implementation plan blueprints a set of projects aimed at boosting the slumping economy of West Berkeley. 

The major projects include upgrades for the Amtrak and Caltrain stops, Aquatic Park, and Second and Gilman Streets-which carry an total price tag of up to $7 million. 

Urban Housing Group, a San Mateo-based development firm, submitted an application June 17 to build a 180-200 unit five-story structure on the corner of University Avenue and Fourth Street at an estimated $40 million. 

Development of the site would consist of mixed-use properties-commercial and residential-with 20 percent of the residential units planned for low-income housing. 

"This project will blend into the fabric of West Berkeley," says Dan Deibel, director of development for the Urban Housing Group

The 2005-09 plan is a modification of the original West Berkeley Redevelopment Plan, implemented in 1967. 

The 1967 plan, which kicked into full gear in 1993, was designed to entice new development in West Berkeley in all sectors present-commercial, manufacturing, mixed-use light industrial and mixed-use residential. 

"It is important to preserve a diverse economic base," Seldon says. "And the industrial factor is under pressure as industrial space is converted to other uses." 

Heavy Industry Suffers 
But the revitalization of what was once the heart of heavy manufacturing has had its consequences. 

While small spaces have drawn many retailers and small businesses to the area, the breakup of large property lots has left large businesses with limited options in West Berkeley. 

At $1.50 per square foot, well below downtown Berkeley's $2.08 tab, small start-up businesses are attracted to West Berkeley. 

"Small spaces have done well in the Fourth Street market," says Ben Harrison of Colliers International, a worldwide real estate agency. "Larger units are being divided for smaller companies." 

But the incentive for small companies to move into the area can impede the attraction of larger companies, Harrison says. 

With few remaining large spaces, Harrison says, it could become difficult for large companies to find adequate space. 

Balancing big industry with smaller retail can be a delicate tight-rope act, says Cynthia Kroll, professor at Haas School of Business and senior regional economist at the Fisher Center for Real Estate and Urban Economics. 

She points to nearby Emeryville's recent redevelopment as an example of a successful balance between industry and retail. 

Berkeley is careful when it comes to revamping its city structure, Kroll says, and predicts that like Emeryville, the city will not fall into the out-of-balance trap. 

Traffic, Pollution Concerns 
But drawing throngs of shoppers brings more than just revenue. 

"There has been an increase in traffic on Fourth Street," says Peter Eakland, associate traffic engineer for the city's Office of Transportation. 

Visitors to the shopping district must use the surrounding streets to access freeways and main roads, causing hundreds of cars to clog the streets, Eakland says. 

"The most problematic area is actually the long lines of cars turning onto University from Sixth Street to get on the freeway," Eakland says. 

An increase in traffic comes on top of the environmental risk posed to residents and visitors of West Berkeley. This risk is compounded by a long legacy of waste left by metal works and chemical plants, which include the highly carcinogenic Chromium 6. 

"The city should be cognizant of where air quality is bad and avoid planning for children, homeless and sick people in those areas," says Nabil Al-Hadithy, administrator of Berkeley's Toxics Management Division. 

An environmental impact study from 2003 revealed that despite mitigating factors, expansion of the Harrison House Emergency Shelter, a halfway house for the homeless, posed "significant and unavoidable" risks from particulate matter. 

Similarly, the construction of nearby Harrison Park, which contains two soccer fields, a field house and a skate park, was suspended because of a plume of hexavalent chromium, a highly carcinogenic chemical. 

While chromium exposure was later determined not to be dangerous in a 2003 air quality study, the same study revealed that particulate levels regularly exceed state standards. 

"One hundred days out of the year the air quality is so bad that it requires a sign," says L.A. Wood, member of the Community Environmental Advisory Commission. "Putting up signs next to the park is like putting a warning on the side of a pack of cigarettes," he said. 

The development plan opens for comment today. The West Berkeley Project Area Committee The commission will hear comments at West Berkeley Redevelopment Area Open House at the West Berkeley Senior Center 7 p.m. tonight.

Contact Duni Heimpel at dheimpel@dailycal.org.

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