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Dey LP Will Close in 2013

MONDAY - JUNE 25, 2012 - NAPA, CA - Mylan Specialty, formerly Dey LP, will close by the end of 2013. J.L. Sousa/Register

Napa County may abandon redevelopment of the Health and Human Services Agency’s campus on Old Sonoma Road, choosing instead to buy the Dey Labs facility on Napa Valley Corporate Drive, some two miles south of Imola Avenue.

On Tuesday, the Board of Supervisors will decide whether to enter into further negotiations with Dey Labs’ corporate owners, Mylan Inc., that could lead the county to buy the 25-acre property and the 154,500 square feet of building space that once housed one of Napa County’s largest employers.

Mylan announced in June that it was shuttering pharmaceutical operations at the site by December 2013.

The estimated price tag is $25 million, but the site offers benefits that are likely significantly cheaper than if the county pursued its current plans to redevelop the agency’s campus on Old Sonoma Road, said Larry Florin, director of the county’s Housing and Intergovernmental Affairs Department.

Those plans call for a phased-in demolition and construction of new buildings. The county has determined that it will need at least 100,000 square feet of office space, and the first phase of the project at Old Sonoma Road is estimated to cost $27 million, Florin said.

That would get the agency only 65,000 square feet of office space, and the remaining portion of the project would have to wait until it could be funded. The total project was estimated to cost $50 million, and was scheduled to start in 2014 and continue over a 20-year period.

One of the biggest priorities for the redevelopment project is to consolidate health and human services into one location. They’re currently spread out among three locations on Old Sonoma Road, First Street and Imperial Way.

The cost estimates associated with achieving that consolidation were starting to balloon as the county went further into the planning process, Florin said.

The county recognized that it wasn’t getting halfway toward its goals with the money it’s set aside for the project, he said. “We really, financially, couldn’t see past phase one,” Florin said.

The Dey Labs site boasts 93,000 square feet of office space in two buildings, and could potentially be a cheaper way to accomplish that consolidation, Florin said. Outfitting the space would carry its own costs, though, which will need to be determined.

The site has two other buildings that have a mix of manufacturing, warehouse, laboratory and office space that the county would most likely lease out, Florin said.

“This was an opportunity that we thought was worth studying,” Florin said. “It caused us to sort of re-evaluate the course upon which we were going. I think there’s more sufficient space to consolidate them for the amount of money that we have.”

Florin said if the board does give a nod toward continuing negotiations, the county could potentially return with a purchase-and-sale agreement in early February. Following that, it would take four to six months to assess the buildings’ conditions, and to determine if the space would be a good fit for the agency.

A move would coincide with another decision the board made late last year to pursue locating the new Napa County jail away from its current downtown location to a potential location near Napa State Hospital on Highway 221.

An environmental impact report for the Old Sonoma Road project is underway. That report was already evaluating the option of moving the agency to an offsite location, so Florin said it could take account of the Dey Labs property with some adjustments.

Florin said the county would have to decide on what to do with the agency’s existing locations if it went ahead and bought Dey Labs. It would also have to devise access for public transit users, which would likely entail having the Napa County Transportation and Planning Agency connect a bus route to the site, he said.

Randy Snowden, director of the Health and Human Services Agency, said the majority of the agency’s more than 30,000 clients use cars to drive to and from its facilities, but acknowledged that accessibility to the Dey Labs site is a question that will have to be answered if the county moves forward.

“I’ve just learned about the option and glanced at the facility once,” Snowden said. “The important thing is that it is convenient for the county residents being served. Until the experts can come in and take a look at it, I just know it’s an attractive-looking site.”

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