The Centre City Development Corp. board voted unanimously this morning to recommend the San Diego City Council move toward exclusive negotiations with a developer to rebuild the City Hall complex.

Board members cited the potential liability of staying in the current buildings, the desire to have city employees to work close to each other, and the potential cost savings of the project as the reasoning for their support.

They noted that an exclusive negotiating agreement wouldn’t bind the city to commit to the proposal submitted by Portland-based developer Gerding Edlen, which calls for building a 34-story tower to house the city’s workforce and surrounding the building with residential, retail and office space.

A City Council committee is scheduled to hear about the project on May 27.

Today’s presentation included new estimates of what it would cost to stay in the current city buildings. A consulting firm estimated that it would cost a minimum of $19.5 million to maintain the current city buildings for five years before a new City Hall would open under Gerding Edlen’s proposal. If the City Council decided to hold off on building a new headquarters for 10 years, it would cost a minimum of $40.1 million to keep the buildings functional during that time.

Those estimates were used to rework the projected costs of going forward with the developer’s plan or staying put. Depending on the assumptions used, the Gerding Edlen plan could cost as much as $14.6 million or save the city up to $37.6 million over the next decade, according to the analysis. Short-term cost savings in those scenarios resulted from the city selling land to the developer, an official from Jones Lang LaSalle said.

Over 15 years, all the Gerding Edlen scenarios were found to be less costly than waiting 10 years to build a new City Hall, according to the analysis. And the developer’s plan was found to save the city money over 50 years — as much as $235.6 million — unless the city finances the entire building with taxable debt.

RANI GUPTA

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