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Public Hearing on the Kaiser Medical Center Project pg. 6 Staff Recommendation May 3, 2010 To respond to this issue as part of the Final EIR, staff retained the economics firm of Keyser Marston Associates (KMA) to undertake a review of the trade area and its demographics; to quantify the retail spending power in the trade areas and compare them to Bayfair sales and potential sales at the Kaiser Site; to review all of the competitive retail centers in the field; and to review the experience at Eastmont Mall and Baldwin Hills Crenshaw Plaza as it pertains to urban decay. The KMA analysis concluded the following: • Since a future mixed-use retail development project could feature a variety of potential retail concepts with markedly different potential impacts on existing retailers, it is premature to conclude as to potential urban decay impacts at this time. • Even if the retail concept focused on store types represented at Bayfair (not assured), the share of trade area sales at the Kaiser Site would be small, about 10% of the total trade area sales potential for these types of stores. This would not be a dominant center and would not, therefore, likely cause urban decay. Bayfair currently captures only a small share of retail spending for shoppers' goods by residents of the Bayfair trade area. Therefore, it is unrealistic to portray that a high proportion of retail sales at the Kaiser Site, even if focused on similar store types, would be at the expense of Bayfair. Data indicate that the trade area within a ten minute drive time of the Kaiser Site is underserved for shoppers' goods, with sales potential exceeding sales by more than $200 million annually; therefore, retail at the Kaiser Site focused on shoppers' goods could serve an unmet demand; Staff does not believe that any of the information presented to the Planning Commission at the April 22, 2010 hearing or since that time changes the conclusions of the Keyser Marston Associates study, and that this issue has been adequately and appropriately addressed. MINOR CORRECTIONS Minor typographical errors were discovered prior to the Planning Commission meeting. Those errors were clerical in nature and the Planning Commission directed staff to make the appropriate corrections for the City Council material. Those corrections related to Exhibit C - Findings of Fact and the Public Notification section of the Planning Commission staff report and to the Conditions of Approval related to the Transportation Demand Management Plan. These corrections have been made. ACTION REQUESTED OF THE CITY COUNCIL Staff recommends that the City Council take the following actions: 1) Conduct a public hearing on the project and its associated EIR; 2) Adopt the City Resolution adopting the CEQA Findings for the Project (Exhibit `B" to the April 22, 2010 Planning Commission Special Hearing) including the Statement of Overriding Considerations, and certification of the Kaiser Permanente San Leandro Medical Center/Mixed-Use Retail Development Project EIR, as well as approval of the Mitigation