Sutter County is in the process of purchasing the former Kmart building in Yuba City with plans to convert it into the future home of the Health and Human Services department.

The county currently holds a long-term lease for the property at 850 Gray Avenue. Officials entered into an agreement with the property owner in October to purchase the facility for $8.24 million.

“We have made an offer on the property, which has been accepted by the owners and are currently in a 120-day due diligence period to determine whether we want to move forward with the purchase,” said Leanne Link, assistant county administrator for Sutter County.

Link said the due diligence period gives the county the opportunity to fully assess the building’s condition, the bid market, and financing mechanisms that are best suited for plans moving forward.

The nearly 85,000-square-foot building will allow county residents the opportunity to access a number of different Sutter County Public Health system services in one location. Currently, HHS staff is located in several different buildings and suites.

“Consolidating services into a single location makes it less complicated for our customers to get the services that they need,” Link said. “Many of our customers have little access to transportation, so a single site with good public transportation access has always been a goal. In addition, a single site means better coordination and collaboration in the delivery of services, which helps to achieve efficiency in administering our vital safety net programs.”

The building has been vacant since December 2014. The county entered into a lease agreement for the building in June 2017 for a monthly fixed-rate of $16,125.

Once the due diligence period is completed, Link said the county will have a far more concrete path forward and better idea of timing. The county is still assessing the cost of a remodel for the building, which will be in addition to the purchase price.

“Delays are not unusual in this type of transaction. We continue to work through all challenges and are moving forward,” Link said. “…The timeline will depend on the result of the findings from the due diligence period, which ends in mid-February.”


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