Dust Not Settled on Orange Avenue Regarding Current Tenants

Coronado business properties are being showcased for lease by commercial real estate group, Retail Insite.

As Bruce Kleege is making his intentions known for the Coronado Assemblage properties, Coronadans are looking for ways to express what they want to have happen. On Orange Avenue as well as on social media, Coronadans are expressing a range of emotions from dismay to skepticism to downright anger. Some fear that the eviction of the El Cordova Garage will remove essential services of automotive repairs and towing from town. Moreover, the notion of replacing the garage with a restaurant adds fuel to the fear that new businesses are more likely to be geared toward non-locals. Others have expressed deep sadness that Island Surf closed – that it represents an end of an era and further confirmation that retail might soon be in the hands of “outsiders.” And, still more are now looking with trepidation toward Costa Azul and wondering what its future holds since Kleege singled it out for mention in his recent interview with The Coronado Times. Also, many are concerned about the fate of Coronado’s only bookstore, Bay Books.

El Cordova Garage

For now, Kleege has announced plans to put a restaurant in the El Cordova space and has said he has “great offers” on the building that Costa Azul now occupies. Other than that, he has said that he is “happy with all tenants” and hopes they all will stay. Furthermore, he stated that he has raised no rental rates (although most business owners who have spoken to us have indicated that his property managers did, indeed, talk of future rate hikes), but that, of course, he could not say what the future would hold.

For starters, all agree that Kleege now owns the properties and he can change them. Most of the business owners had retained relatively short leases under prior ownership and the leases had more recently lapsed to month to month for a number of the businesses. In fact, the relatively short-term lease structure was one of the selling points of the Assemblage when CBRE marketed it for sale. These Coronado business properties are currently being advertised by Retail Insite (Commercial Real Estate) as The Shops of Coronado:
The fear that has repeatedly been expressed is this: We don’t want to be another La Jolla. As one person added, “It’s not that there is anything wrong with La Jolla, but that’s not who we are. We are a small town and I want to keep our small-town environment.”

What Do We Risk Losing?

Consumers lose an essential service

Rock Walton, owner of the El Cordova Garage has been struggling with loss since getting the news several weeks ago that he was being evicted. Rock has owned the El Cordova Garage since 2007, but the garage itself has a much longer history in Coronado – over 100 years, to hear Rock tell it.

“I can’t just roll over,” Rock said. He pointed out the importance of his business to the City of Coronado – his is the only on-Island tow company. That means that if your car is towed by him, you know where to find it. He also has a full-service garage where people can get repair and maintenance work done without leaving the Island. For those who are concerned about services for locals disappearing, the garage would seem to be a prime example.

One family loses its livelihood

Rock Walton and his dog, Kai

But, for Rock, the story is even more searingly personal. He came to work at the garage many years ago at a time of deep personal crisis. Over time, the garage came almost to heal him as he worked through his personal issues and raised his family in Coronado and at the garage and, eventually, came to own it.

The eviction upends Rock’s life and that of his family. Over time, the El Cordova Garage became practically a second home for Rock and his children. And, he expected that he would eventually turn the garage over to his sons, both of whom currently work there. Rock says that if the garage goes away, he’ll need to leave as well. “I can’t afford to live in Coronado without a job.”

Rock said, “A few weeks ago, I woke up worth a couple of million dollars [the amount that he estimates he has put into the business over the years], and I came to work and met with Kleege’s people and found out I was worth about maybe $50,000.”

The City of Coronado loses its sense of history

The Vintage El Cordova Sign

But, it’s not just about Rock or his family. It is about Coronado – how it developed, what it was and what we want it to be. Rock sees the garage as a critical piece of the history of Coronado. He speaks of its history as a DeSoto dealership even before it was a garage. Rock’s love of Coronado history is evident from a look around the garage – the neon El Cordova sign, the historical photos, and even the La Avenida sign that, as Rock put it, “[was treated as] garbage, but we saved it because it means something to Coronado.”

The Coronado community loses traditional supporters

Rock also sees his business and other local businesses as a critical part of the Coronado community – much more so than non-locally-owned businesses tend to be. This is so because he, like Manny Granillo at Island Surf, among others, has been a “huge supporter of this community.” He has been involved with “parades, golf tournaments – and I don’t even play golf – SAFE, the Fire Department,” and other local causes. “What has Walgreens ever done for this town?” he asks just before he tells me a story about how Walgreens came into town “selling a story of how it was going to be involved in the community. But, it was a bunch of lies. Just like this guy [Kleege] is lying and intends to kick everyone out of here.”

What Power do Residents Have to Shape the Outcome of the Sale?

Rock has been struggling with the issue of how to fight back since getting the news of his eviction. But, when you get right down to it, Kleege now owns the property. If he wants to not renew leases, he can do that.

Rock is concerned that Kleege might not have done enough due diligence to make the sorts of changes he would like to. If that is so, Rock fears that the end result might be that Coronado will end up with a “bunch of empty buildings – it will be the story of Coromart all over again.”

In fact, Rock is right that Kleege cannot do whatever he wants as owner – in fact, as Sue Gillingham from the Coronado Chamber of Commerce pointed out earlier, there are significant zoning rules and regulations around this portion of downtown Coronado that will govern, to a large extent, just what Kleege can and cannot do. Kleege himself admitted that he was locked in by zoning rules in many ways. But Rock fears that “[Kleege] thinks he is important enough that he can dictate to the city what needs to happen [to support his plans].”

Will the city bend to Kleege’s will? Can the city do anything more than passively let the zoning laws shape what Kleege can do? Rock is hoping it can: “This garage has always supported this city. Now I need the city’s support.”

Rock is asking his loyal clients to contact their councilmembers and ask for help. And, much as it will be painful for Rock to leave the garage that he has so loved, he wonders if there is something anyone can do to help him find another spot on the Island. Rock serves Island clientele and he serves as the main towing service for the City of Coronado. He just can’t see doing that off-Island.

If there is anything else that clients can do to support the businesses that they want to see prosper on the Island, the obvious answer is this: Go to those businesses and spend your dollars there. Rock wanted to speak it loud and clear: THE EL CORDOVA GARAGE IS OPEN AND IS IN BUSINESS. Brant Sarber, owner of Costa Azul, and Angelica Muller, owner of Bay Books, have both echoed this for their businesses as well. If residents value those businesses, the best way to show it is to spend your dollars there. Then, when the inevitable call comes for higher rents, the businesses will be better able to meet that demand.

David Spatafore, another business owner on the block, who is in a much better position as he had already secured longer-term leases for Mootime and Leroy’s prior to the sale, agreed that the best thing for local businesses now is to maintain and grow their customer-base because that will make it possible to pay the rents. He said: “I hope we can preserve some of the local feel … but [Kleege’s] a businessman … and he expects a return on his investment.”

That is the flipside to this story. While many are concerned about the livelihood of local families, local services, and small-town Coronado, this is also a story of business and the business of capitalism.

Bruce Kleege purchased a sizable share of downtown Coronado real estate and he did it at a sizable price. While he said that he had paid a substantial price for the property and “wouldn’t have done it without an interest in the community,” most would agree that he wouldn’t have done it without an expectation of profit. As one business owner said, who can blame him? “If you bought your house for $500,000 and it had appreciated to $3 million, would you not sell it for $3 million?”

The issue for Coronado is that most of what residents are hoping to hang onto is a collective good – our shared community and town feel. But, individual business owners – most of whom have been reluctant to speak on record since they fear potential repercussions for their businesses in one way or another – cannot individually be expected to be the primary base of support for that collective good. Real support would take a broad coalition of the business owners, their clients, the town, its institutions, and a lot of noise.

Rock Walton prepares for his 10News interview

Rock is doing his best to make noise. He hasn’t backed down from speaking his mind – even now when he said that he doesn’t really think it will help him, but that he is hoping he can help the rest of the block. Rock was making as much noise as possible earlier this week as he was interviewed by 10News; but, he will not likely be successful on his own. Time will tell.

Editor’s Note: The author, Luan Troxel, has no association with the “Troxel Building” located at 10th Street and Orange Avenue that previously housed Troxel’s Hardware.

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Luan’s background spans a range of industries from academia to management consulting to investment banking. Along the way, she earned an undergraduate degree in political science at Northwestern University, a PhD in the same field from the University of Michigan and an MBA from Columbia University. She has lived on both coasts and many states in between, as well as in Bulgaria and Germany. Have news to share? Send tips, story ideas or letters to the editor to manager@coronadotimes.com