The Chappells and Cannons are two of more than 90 investors who pooled their savings to purchase the property in hopes that, within a few years, a high-rise riverfront hotel or office building would spring up on the site. But investors feel the city has sold them down the river. They say that the Redevelopment Agency of San Jose decided to put their lot into the park's master plan without consulting all the property owners involved, effectively dashing any development possibilities. Last year they lost a suit against the Redevelopment Agency to force the city to buy the property. Now they're appealing the suit and appealing to the city to give them some indication of what they can do with their land.
City attorneys say the investors are trying to make the taxpayers pay for their bad investment.
They argue that the developers were foiled not by the city's park plan but by their own overambitious ideas and a bad building market. They point out that in over a decade, the group never formally submitted a solid development proposal. Observers say the case gives insight into how much of downtown development depends on quiet negotiations and tacit official approval. The investors started buying properties near Henry's Hi-Life back in 1984, when the construction market was heating up and the ambitious River Park Towers project was in the works. The initial plan, spearheaded by Murlin Vellequette and Cliff Wininger, was to assemble 14 small lots containing houses and small businesses and sell them to a developer.