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By BOB QUICK | The New Mexican
January 1, 2006
2005 came and went with widespread concern among business owners about
the city of Santa Fe's mandated
minimum-wage ordinance, which rises to $9.50 today.
Business owners say they may have to raise prices and cut workers' hours
to cope, but proponents say higher wages are necessary for workers trying
to cope with pricey Santa Fe.
Many retailers saw higher sales, and Santa Fe Place (formerly Villa Linda
Mall) finished a multimillion-dollar renovation and added new stores. DeVargas
Center also brought in more
tenants. More competition for department stores is on the way with the
planned construction of a Kohl's discount store on the southwest side of
town.
Real-estate sales continued strong, with the median sales price
approaching $400,000 before softening in the third quarter of 2005.
Thornburg Companies won some legal victories in its efforts to build a
new office campus on the northwest side of town, near Santa Fe Estates,
and is expected to start construction this year.
Also involved in a court battle are the developers of a planned Wal-Mart
on Cerrillos Road.
Despite the litigation, the developers say they plan to start
construction in the spring.
And the city's planned civic center was approved and now will move ahead,
with completion expected by early 2008.
1. Minimum-wage ordinance
The biggest business story of the past year -- as it was in 2003 and in
2004 -- is the city of Santa Fe's
minimum-wage ordinance. The law calls for businesses with 25 or more
employees to pay $8.50 an hour, a rate that rises to $9.50 per hour
today.
Business groups, including the Santa Fe Chamber of Commerce, opposed the
ordinance, first in state district court, and when that failed, in the
state Court of Appeals.
There was some expectation on the part of business owners that the higher
court might rule on their behalf, but the judges came out unanimously in
favor of the city.
"The city has the power to set a minimum wage for private employers
that is higher than that mandated by the state," the court said.
"The ordinance does not conflict with state law and is not otherwise
unconstitutional."
The ruling apparently took the wind out of the opponents' sails, and a
chamber spokesman said in late December that the chamber -- and
apparently other plaintiffs in the lawsuit -- would not take the ruling
to the state Supreme Court.
"We're kind of beat up financially," one plaintiff said in
explaining the reason not to continue the litigation.
There is some possibility the Legislature might consider a law that would
pre-empt the city's minimum-wage ordinance, and to address that, four
Santa Fe city councilors introduced a resolution that asks state
officials not to override the city's wage.
2. Battle over Wal-Mart
Santa Fe has had a Wal-Mart for more than 20 years -- the first one was
in the College Plaza shopping center, and Sam Walton himself was here to
mark the event.
Now Santa Fe dentist William Herrera and two Scottsdale developers have
proposed a Wal-Mart Supercenter on Cerrillos Road just southwest of Ocate
Road. It would be the anchor store of a 265,000-square-foot retail center
called Entrada Contenta that also would include a Walgreens.
The measure was approved by the City Council after Mayor Larry Delgado
broke a tie with his vote, but opponents of the development have filed
suit in state district court to block the development. They claim the
council improperly reversed itself in making its approval.
"The latest is they don't want any Santa Fe judges to hear the
case," said Tom Keesing, project manager for Entrada Contenta.
"We were appalled by this; it's a Santa Fe issue."
Despite the litigation, the Wal-Mart store expects to receive approval of
its plan in February and break ground in the spring, Keesing said.
"There are no major obstacles, (but) if there are, we will overcome
them."
Stephen Durkovich, the attorney representing the development's opponents,
could not be reached for comment.
The Wal-Mart corporation was also in the news in 2005 with the opening of
a gasoline station at the Santa Fe Sam's Club on Rodeo Road. Sam's Club
is a Wal-Mart subsidiary.
The station was delayed for years by a legal battle, but it finally
opened March 30 to the acclamation of motorists tired of paying the
highest prices in the state for gasoline.
The price of regular unleaded gas was $2.19 when the store opened, with
premium priced at $2.39. By the end of the year, during which time the
price of gas rose to more than $3 per gallon before falling, Sam's Club
was $2.20 for regular and $2.40 for premium.
3. A victory
for Thornburg
Another development, the Thornburg Office Campus, also has faced legal
challenges, but by the end of the year, the project seemed to be finally
moving ahead.
On Dec. 16, a state district judge dismissed claims by Concerned Citizens
of Santa Fe North for injunctive relief and damages. That ruling came a
month after the state Supreme Court declined to consider an appeal from
the same neighborhood group.
That means Thornburg can proceed with its project, said Thornburg
attorney Frank Herdman.
Opponents of the project have said that the buildings and parking area
violate restrictions imposed when the land was designated for
development. They also say commercial development should be limited to
retail shops.
The new office complex will be near Ridgetop Road and Rincon Avenue, just
south of the Veterans Memorial Highway, on land owned by Santa Fe
Estates.
The 100,000-square-foot building will consist of three buildings, one for
Thornburg Investment, another for Thornburg Mortgage and a third for
Thornburg Companies.
Together the buildings will be able accommodate up to 250 employees. Thornburg
employees are now scattered among separate buildings on Washington Avenue
and Marcy Street in downtown Santa Fe.
4. A mall makeover
and more
The new Santa Fe Place (formerly Villa Linda Mall) was on top of retail
developments in Santa Fe in 2005. The city's largest mall was purchased
by Atlanta-based Gregory Greenfield and Associates in March.
Greenfield immediately announced a $10 million makeover for the
20-year-old shopping center, an improvement that was completed just in
time for the Christmas shopping season.
The holiday season seemed to go well for some Santa Fe stores, including
Design Warehouse, a downtown furniture business, where owner Larry Keller
reported a near-record year.
But Wendy Gerner at Purple Sage, a women's clothing store, said December
sales were "definitely down" from December 2004. "You look
outside and there are parking spaces in front of the store," she
said. "The foot traffic doesn't seem to be as high, and I have a
feeling the average sale amount is down."
At the Santa Fe Wal-Mart, "We had a pretty good season," said
store manager Kathryn Erickson. "We did better than last
December." Electronics were the biggest seller this year, especially
Apple's popular iPod. "Everybody in town is out of them," she
said.
Also in retail, Santa Fe's Banana Republic closed at the end of business
on Christmas Eve because its lease was up and sales apparently didn't
justify remaining paying high downtown rents. The store's West San
Francisco Street building is on the market for $5 million.
Out in Valdes Business Park, Kohl's plans to build a 69,000 square-foot
store on about 11 acres of land owned by the Hart family, owners of the
local Coca-Cola bottling company. Kohl's carries mid-priced apparel,
shoes and accessories.
5. Restaurants
Santa Fe's restaurant scene stayed busy in 2005 with a number of places
opening and closing.
Among the closings were three Chinese buffets. The first to go was China
Palace at Santa Fe Place, soon followed by Ten Ten on Cerrillos Road. Not
long after that came word that New China Super Buffet, also on Cerrillos
Road, had closed. That left one buffet, China Star, which is also the
largest.
There are several Chinese restaurants that also serve buffets at lunch,
but one of those, Hunan Restaurant, owned by Alex and Liya Lee, closed.
It is to be replaced by a place called Himalayan Cuisine.
Another major development was the closure of the venerable Palace
restaurant and its replacement by Seņor Lucky at the Palace, a
family-style eatery.
Also closing in 2005 was Carlos' Gosp' Cafe. That happened after owner
Carlos White had some financial problems. White said he might reopen
elsewhere. In the mean time, Piccolo Cafe moved into the space on Lincoln
Place vacated by Carlos'.
Another closure came in mid-November when Rooney's Tavern on North
Guadalupe Street shut its doors.
Two nightclubs/restaurants -- the Paramount and Chilaca's Family
Restaurant -- closed, but Chilaca's will reopen in the first weeks of
January as El Pecos Trail Pizzeria. The pizzeria will have a bar but no
music, a spokesman said.
Pranzo Italian Grill, which opened in 1989, changed hands and is now
owned by Michael O'Reilly, who also owns the O'Keeffe Cafe.
Other openings included Mission Cafe and Sweet Shop on East DeVargas Street,
Las Salsas Mexican Food in the old Austin's steakhouse in College Plaza
South shopping center, Dion's Pizza in College Plaza, and Fish and Pasta
Cafe in the Baca Street Bazaar. Also opening, in the Solana Center, was
Annapurna Ayurvedic Cuisine and Chai House.
Santa Fe Brewing Co. moved to the former Wolf Canyon Brewing site after
extensively renovating the property.
Also opening was the Flying Tortilla Cafe, a spin-off of the popular
Pantry restaurant. The new place moved into the old Kettle restaurant
location near Santa Fe Place.
New, too, are two gelateria -- Ecco on Marcy Street and Gelato Benissimo
on Guadalupe.
6. El Corazon
Sales at El Corazon, both of memberships in the residence club and of the
development's 33 condominiums, moved ahead in 2005.
Memberships sales in Santa Fe's first residence club, the Residence Club
at El Corazon de Santa Fe, started in September. By the end of the year
four of those memberships had been sold.
"That's what in line with what it should be," said Deborah
Olson, the qualifying broker in charge of sales. "We've been doing
significant marketing."
The Residence Club consists of a clubhouse and 25 two-bedroom residences.
One hundred memberships in those units are for sale at prices ranging
from $180,000 to $275,000, depending on the size of the unit.
Annual fees cover property taxes, insurance and other costs.
On the east side of El Corazon, sale of the condos is almost complete,
said local real-estate agent Paul Duran.
"It's been a home run," he said. "This is Santa Fe's first
urban downtown project."
Construction at El Corazon is expected to be complete in the first
quarter of 2007.
7. Auto sales
Santa Fe's auto sales industry went through a major makeover in 2005 with
the sale of Joe Horace's Kia dealership to Albuquerque car dealer Bob
Cockerham.
And Albuquerque car dealer Bob Pitre bought Santa Fe's Mitsubishi and
Hyundai dealerships.
In addition, Santa Fe Chevrolet underwent a $4.7 million remodeling that
included moving the dealership's auto showroom and administrative area
into a new building at the same site.
Santa Fe Chevrolet also added 2.5 acres of adjacent land needed for
vehicle storage. "We will be able to store in excess of 600
vehicles," said Santa Fe Chevrolet general manager George Woolard.
Horace said he decided to sell his last dealership -- Horace Kia -- after
realizing the car business was for younger men. Horace is 77.
The new owners of the Santa Fe Kia store own Car World in Albuquerque,
which has dealerships on Lomas and Wyoming and San Mateo at Osuna.
Also in 2005, Santa Fe Harley Davidson announced plans to move from its
Cerrillos Road location to a 5-acre site in Santa Fe County, off N.M. 14
and adjacent to the Santa Fe Brewing Co.
A grand opening is anticipated for June or July 2006, according to owner
Frank Costa.
8. Real estate
Santa Fe real-estate sales continued to be strong in 2005, even as some
observers feared a bubble might bring it all down.
The strength of the real-estate market became apparent in the second
quarter of 2005, when the median sales price in the city of Santa Fe
reached an all-time high of $393,400. That was up
15 percent from the same period in 2004.
One real-estate agent said the price didn't reflect many sales in Tierra
Contenta and would have been somewhat lower if it had done so.
At the same time the prices were rising, the number of homes sold in the
city dropped 14 percent, an indication of a lack of inventory.
Despite the higher prices, Robbie Dobyns, then president of the Santa Fe Association
of Realtors, said he didn't think a bubble had formed. "Our prices
are too high, and our incomes are too low," he said.
Another agent, Beverly Chapman, agreed, saying Santa Fe didn't have the
affordability for speculative buying and selling.
In the third quarter, the median sales price fell to $364,000 from the
record high in the second quarter. Dobyns said the market seemed to be
cooling down "a little bit" but he predicted the fourth quarter
would be a strong one.
9. Civic-center delay
As it turned out, picking the design for the city of Santa Fe's new civic
center and parking garage to replace Sweeney Center was the easy part.
Once that happened, it looked like construction of the $55 million
facility would move ahead quickly.
The winning design was by Spears Architects of Santa Fe and partner
Fentress Bradburn Architects of Denver and included elements of both the
Territorial and Pueblo styles. The second level includes a courtyard
terrace with outdoor meeting space. The center was to be completed by
mid-2007.
But as it turned out, the project was to be located on what turned out to
be an ancient Tewa village that also held human remains. Tesuque Pueblo
objected, and the state Cultural Properties Review Committee asked the
city and the pueblo to try and work out a compromise.
In mid-December they did reach an agreement that reduced the 600-vehicle
parking garage by 88 spaces, so fewer human remains will have to be
excavated.
Sweeney Center is now expected to be demolished early in the new year
with a completion date for the new center scheduled for early 2008.
10. Banking
Local banks and credit-union activity peaked in November when Del Norte
Credit Union, the largest in Northern New Mexico, opened a new branch on
a 2.46 acres of land at 3286 Cerrillos Road.
The $2.8 million, 7,300-square-foot branch features six drive-up banking
and ATM lanes and employs 18 people.
The credit union closed its
St. Michael's Drive branch and consolidated it with the new branch.
In July, the new Ironstone Bank opened at 700 Paseo de Peralta in the
former Spitz Gardesky house.
Ironstone has 15 offices in New Mexico, Arizona and elsewhere in the
West.
In other bank news, New Mexico Bank and Trust's plan to build a new
branch is on hold following a legal protest by neighboring Community
Bank. The City Council approved the rezoning needed for the new branch.
Community Bank would be right next to the planned New Mexico Bank and
Trust building, and apparently there was some concern the two banks' drive-up
facilities would interfere with each other.
But Alan Austin, president of New Mexico Bank and Trust in Santa Fe, said
a city traffic engineer had worked out a traffic plan approved by both
banks.
District Judge Daniel Sanchez will consider Community Bank's appeal of
the council's rezoning decision. As for a time frame, "that's
completely up to the judge," Austin said.
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