FREMONT -- City officials have started the eminent domain process to purchase a parcel of land considered key in developing the downtown area, while taking steps to reassure neighboring owners that their properties are not next for the wrecking ball.

The five-member City Council unanimously voted last week to seize and acquire a 65,150 square-foot property at 39138 Fremont Blvd., between Mowry and Beacon avenues. The parcel is home to a three-story office building that houses a Citibank branch and other businesses. The building is in Fremont Plaza, a strip mall between a pair of outdoor shopping centers, Town Fair and The Hub.

"The city is looking forward to meeting with representatives of the owners of the Citibank building as soon as possible to work out the differences we have regarding the value of the building," City Attorney Harvey Levine said. "We have already reached out to the tenants to assist them in finding new places to relocate."

Norm Matteoni, a San Jose-based attorney representing the Southern California-based property owners, Fremont Capital Group, LLC, said the city is not offering fair market value.

Fremont officials said they are unable to reveal how much they are offering while they are in negotiations to buy the land. Those figures may be revealed when the city files an eminent domain action in court, which could happen by the end of the month, city officials said.


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Matteoni said his client could contest the city's right to seize the property or the its purchase offer, or both. "We'll decide on what we'll do when we respond to the court filing," he said.

Fremont city officials are trying to purchase the land for a project to extend Capitol Avenue, a two-lane street about a one-third-mile long, between State Street and Paseo Padre Parkway. Extending that stretch of road about a block would make Capitol Avenue the linchpin of the city's plans to develop about 110 acres that include the existing Fremont BART station and City Hall.

Extending the avenue so that it connects Fremont Boulevard and Paseo Padre Parkway would increase the area's traffic flow. It also would improve the chances of making the area a pedestrian-friendly retail destination, helping to create an urban center with a mix of businesses and high-density housing.

"Our plan is to build up the area's infrastructure, so that developers will notice the change and want to be a part of it," said Jessica von Borck, Fremont's downtown project manager.

Fremont has no plans right now to use eminent domain on other properties, so local landlords and residents should not be nervous, said von Borck.

"We've done some extensive community outreach and we've talked with downtown property owners who are pretty excited about our efforts thus far," she said. "The downtown plan adds value to their properties."

One resident said he and others living in or near the proposed downtown zone should expect their neighborhood one day to be "swallowed up into a business area."

Michael Boltz has lived for about four years on Mt. Vernon Avenue, a block from City Hall, where a short row of single-family residences is surrounded by medical and tax offices.

He described his block as the area's "last little neighborhood" but added that he's not worried that he or his close-knit neighbors might one day be displaced.

"I'm not going to be against it because I'm going to help build it," said Boltz, who works in construction and maintenance. "It's going to be good for the economy. It's not like you can stop progress."

Contact Chris De Benedetti at 510-353-7011. Follow him at Twitter.com/cdebenedetti.