Osio Plaza developer is now current on rent and loan payments, and planning to bring new vendors into the space.

The Osio Plaza building on Alvarado Street belongs to the city of Monterey and, until March 2020, it was a go-to spot for independent films – at the Osio Theater – and good coffee at Cafe Lumiere. There are apartments upstairs – 29 low-and moderate-income housing units – while the downstairs is designed as a mixed-use commercial space that includes a five-screen theater.

That’s where the beloved Osio Theater (since 2000) and Cafe Lumiere (since 2013) were located, attracting residents and tourists alike. It was not Covid but the landlord, San Jose-based Green Valley Corporation, that, in the fall of 2020, forced both ventures out of business by not paying its rent and loans. At one point, Green Valley even tried to wriggle out of its contract with the city. Now, the downstairs of the Osio Plaza stands empty, with no clear future on the horizon.

The building, proclaimed the first New Urbanism project in Monterey – one that promotes walkability with housing, work and shopping combined – was finished in 1999. In order to complete it, the city loaned the developer, Green Valley Corporation, $2.2 million in 1998 and another $365,000 in 1999, at the same time making it the main leaseholder for the commercial part for the next 50 years, when the city will eventually take over the ownership of the whole building, according to the original agreement.

Twenty years passed, and parts of low-interest loan payments started to kick in in 2019. It was then that the city found itself sending default notices to Green Valley.

By the end of 2021 the company owed Monterey $380,000 and was trying to convince the city to take over the space – 30 years ahead of schedule. In February 2020, in a letter to the city obtained via a California Public Records Act request, the company’s representatives argued that the cost of developing the property was higher than expected and that the building is important not only in terms of affordable housing, but also as a cultural hub. The city was in full agreement on the latter point, and that’s why it declined to let Green Valley off the hook.

Negotiations took many months, mostly in closed sessions. By the summer of 2021, Green Valley stopped trying to flee and started to pay. By July 2021 the company was finally “current” on both rent and loan payments, city property manager Janna Aldrete says. Currently, rent and loan payments are covered until the end of April 2022.

Asked if the company will finally bring some vendors into the building, Aldrete says: “I hope so. We want the Osio Plaza to thrive… I reached out to them with the same question and I’m waiting.” Aldrete adds that the city has received phone calls from interested vendors and referred them to Green Valley, but didn’t hear back.

Director of Investment and Portfolio Management responsible for the project, Ryan Hogan, confirmed on behalf of Green Valley on April 19 that they “are looking for commercial tenants to fill these spaces.” Osio Theater and Cafe Lumiere are not planning on coming back.