Three months ago, Reddit user BTSavage commented on the r/santacruz section of the popular link and discussion website: “Scotts Valley can’t decide if it’s going to be (a) unique town or a rubber stamp town. It’s definitely leaning towards Anytown USA.” In the proceeding weeks, as word got out about several longtime tenants apparently being forced out of the shopping center where Target is set to open on Sept. 25, some area residents began to feel the same as the aforementioned Redditor.
But in an interview with the Press Banner Wednesday, Scotts Valley Square Shopping Center landlord Kevin Pratt sought to stomp on that narrative.
“I get the perception,” said Pratt, a developer with Mill Valley-based The Pratt Company. “The complicated reality is that we have had a wide variety of tenants in that center for a long time, some cycling even before this recent change.”
He says he isn’t technically kicking businesses out, since they were on month-to-month leases. Some business owners have said they were prevented from re-signing long-term leases, but The Pratt Company says some tenants were the ones who wanted to be under a short-term agreement.
He acknowledges Target’s arrival does signal an important shift not just for the center, but for the community as a whole.
“Target is going to up the game,” he said. “It’s a misconception to say that we would prefer chain tenants over local operators.”
When, in the midst of the pandemic, Target announced it was planning to open a location in the former home of Kmart, the Pratt Company began fielding offers from businesses willing to pay up to double what current tenants are paying.
“Oh my god,” Pratt said he thought to himself. “That’s what the market is.”
The developer says he had tried to work with businesses to find ways to improve their operations.
“We’ve had a lot of late payments,” he said. “We wrote off a lot of bad debt.”
In the case of Chubby’s Diner, seeking to boost business involved bringing one of the family members behind the restaurant to Santana Row in San Jose for a glimpse into what their culinary experience could become. Instead, they chose to walk away, serving up the last plate of bacon and eggs May 1.
Pratt wanted to expand the restaurant space into EarthWise Pet Supply next door.
But he says he was willing to entertain the idea of allowing the business to move into a bigger store. Brett Aeck, EarthWise’s co-owner, says he even offered more per square foot than he’s paying now and was rejected.
Pratt says EarthWise didn’t make a strong enough business case for operating in a larger retail environment.
Half of the five or six tenants “moving on” involved tenants who declined to sign new leases, he said.
“This idea that somehow by definition that all mom and pop operators are just perfect businesses is just not true,” Pratt said, adding they did make some concessions to the owners who chose to stay on. “We were very gradual in raising the rents. You know, it’s a tricky thing.”
While they are in negotiations with several businesses looking to join the Target complex, no contracts have been finalized just yet, he said.
Meanwhile, construction crews have been laboring in triple-digit heat and at a breakneck pace in anticipation of Sept. 25.
“The project is like 600 little details which are all at risk of falling through the cracks,” Pratt said. “It’s gonna look fantastic.”
The challenge with refurbishing an older location rather than building from scratch is you run into unforeseen challenges, he notes.
“On a remodel you tear off some wood and you find out, ‘Oh this thing underneath is not what we think it is,’” he said, adding they’ve also struggled to secure subcontractors. “They’re very busy. They’re expensive.”
Plus, supply chain challenges have also thrown a wrench into things.
When the developer went to purchase new planters, they assumed they’d arrive in a month or two.
“No, that’s a four-month lead time,” Pratt said. “We’re going to be without a few things when we open.”
Thanks to his prior experience as a theater actor, Pratt likens it to trying to get everything ready for the dress rehearsal—and the big opening night.
“The concrete sidewalks are being poured now,” he said. “We’re over the hump. For a while it was pretty gnarly.”
On Wednesday, Rachel Hebert, a Mill Valley artist, began work on a new mural going up on the side of the complex facing Mt. Hermon Road.
Pratt says he got the idea for the mural on a visit to the UC Santa Cruz Arboretum & Botanic Garden with his son.It will feature a hummingbird “holding up” a bench that people can sit on, and is meant to pay homage to the Ohlone creation myth.
