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Sun Stroke

Christopher Gardner

Edifice Wrecks: Under Sun Microsystems' plan, all but a few of the historic buildings on the Agnews site would be demolished to make way for a new corporate headquarters.

Pete Wilson's friends at Sun Microsystems are getting a sweet deal, and the Agnews Developmental Center is getting bulldozed: the last chapter in the remarkable and tragic history of a place nobody wants to talk about.

By Christopher Gardner and Eric Johnson

'IT'S LIKE FIGHTING the Titans," Santa Clara City Council member Lisa Gillmor says, describing her lonely battle to save the impressive old buildings and once-beautiful landscaped grounds of the Agnews Developmental Center.

Gillmor's opponents are indeed formidable. Sun Microsystems plans to level most of the old hospital campus to make room for its corporate headquarters. Standing alongside the high-end computer giant is the state of California--the property's current owner.

And representing the state is the administration of Gov. Pete Wilson, who counts among his political friends Sun chairman Scott McNealy.

The seven members of the Santa Clara City Council, who serve part time and draw a salary of $400 per month, had been the last hurdle blocking the agreement. But the council voted Tuesday, Oct. 7, to consider rewriting the city's General Plan to meet Sun's development demands.

At the same meeting, Eddie Souza, the former mayor and a vocal critic of the Sun deal, demanded that the council put the decision up to the voters in a citywide referendum. That recommendation was voted down.

Gillmor says she's unhappy about the impending loss of the historic site, but she's outraged about the price the state received for the property.

An expert in commercial and industrial real estate and a Realtor since 1980, Gillmor is convinced that Sun is getting a sweetheart deal. That impression was driven home for her at the Sept. 30 council meeting when the Wilson administration's chief negotiator appeared wearing a bright yellow Sun lapel sticker.

"I question who's representing us," Gillmor says. "Is it a state representative sitting out there with a Sun sticker on their jacket? Is this our true representation? Well then I'm real disappointed. I lose my faith in the system if that's what's happening.

"I don't believe that the state of California represented the best interest of the taxpayers with this deal. I don't know why they had the type of relationship that they had--or why they sold the property for far less than market value."

While the details of the arrangement have not been made public, Sun has agreed to pay $51 million for the 82.5-acre parcel and the 49 historic buildings on it. Following the purchase, Sun will immediately receive a $17 million rebate to make property improvements--bringing the net cost to $34 million.

"For the state to receive $400,000 per acre for the best prime R&D property in this entire Silicon Valley floors me," Gillmor says, noting that nearby property has sold for as much as $2.5 million an acre.

Councilmember Pat Mahan is also unhappy with this deal, which she says has been overtaken by politics.

"This whole thing has been looked at through Sun-colored glasses," Mahan says.

In response to criticism about the state's intimate relationship with Sun, Paula Gutierres, the state's chief negotiator, says it makes sense for her to be a Sun booster.

"Well, Sun is the buyer of the state property," Gutierres says. "We're going to make this a partnership, a public-private partnership. We are trying to sell this property to Sun, and that's what I see my job to be."

A senior real estate officer who has served the state for 20 years, Gutierres says the people are getting a fair deal.

"I love making a lot of money for the taxpayers and doing the right thing for the state of California," she says.

But Gillmor doesn't see the agreement as the "right thing" and is critical of what she says was a last-minute back-room deal, struck a couple of weeks ago between Sun and councilmembers John McLemore and Aldyth Parle. The deal, which followed criticism that Agnews' historical significance was being given short shrift, called for Sun to move as many as 10 buildings off the property. It would be left to the city or state to put them on foundations and do whatever else needed to be done to preserve them. (Sun had previously agreed to restore four of the most significant buildings on the campus, including the auditorium and the old governor's mansion.)

DESPITE ITS PARKLIKE ambiance and historical significance, Agnews has never been a particularly popular place. Mental institutions and homes for the developmentally disabled are rarely celebrated, and that situation has worsened in California in recent years. Perhaps that explains why valley residents are ignoring its plight.

Changes in the state's attitude about providing care for its disabled citizens are reflected in the neglect which is apparent on Agnews' grounds today. But in the not-so-distant past, the facility was a symbol of social compassion.

Almost a mile from the cluster of buildings that make up Agnews Developmental Center, on the northeast corner of the property, stands an old cemetery, overgrown with weeds. Buried there are more than 100 staff and residents who died when the original Agnews center was destroyed in the 1906 earthquake.

Following the disaster, the state rebuilt Agnews as a state-of-the-art developmental health facility. No Nurse Ratchetts here--the place was designed to offer serenity, security and comfort. The buildings are the opposite of what most people would imagine "institutional" to be. They are filled with wood and windows. Many feature spacious entries and huge second-story octagonal sunrooms.

The grounds are equally luxurious (although they are literally going to seed under the care of the state). Mature pines, palms and oaks dot the landscape, as do 50 official state trees--imported from across the nation--many planted more than a century ago.

"The historic buildings and mature landscaping, as well as the various city goals requiring low density," create "unique circumstances"--which actually bring the property's value down, Gutierres says. She then offers a brief lesson in commercial real estate to make her point.

"Buyers of property for high-tech purposes base their price on how many square feet of buildings they can place on the land," she says. "If you figure one million square feet at $51 million, that's $51 per buildable square foot that they are paying."

Gillmor, however, insists that the price is way too low. "You never see property sold for $50 per buildable square foot," she says. "That's nothing." She compares the deal to another that occurred nine months ago and less than a mile away, when Informix paid $2.5 million per acre for its headquarters.

A controversial project from the start, the Agnews sale displaced hundreds of developmentally disabled adults, as well as a child-care center and homeless shelter. Two years ago, the residents were moved to their east campus but still used the west campus for daytime activities.

Gillmor faults the state for conducting "very limited" negotiations with any parties other than Sun. The Wilson administration selected Sun right away as the party to negotiate with, she says. "Others had submitted [proposals] but didn't get very far with the state. It appeared that the state had written their RFP [Request for Proposals] just for Sun.

"I think that it is a very cozy relationship," Gillmor says, lamenting the fact that seven elected representatives--part-timers with other jobs and only volunteer staff support--were left to defend the interests of the citizens who elected them, while an army of state employees worked for Sun.

"It was a snowball effect, so anyone against this project received lots of heat--from our newspaper, the Chamber of Commerce and other business leaders in the city," she says. "It's almost as if people just were brainwashed that it was either Sun or nothing, and if you weren't pro-Sun, then there was something wrong with you."

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From the Oct. 9-15, 1997 issue of Metro.

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