Less than a year after completing construction, only about 65 percent of the City Center shopping complex in downtown Seaside is occupied – and that includes the Fresh & Easy grocery store, which isn’t expected to open its doors until next summer at the earliest.

The center symbolizes the city’s risky investment in what it hopes will be a swanky future. But the payoff is slow in coming.

In 2005, the city of Seaside sold the 4-acre property on the corner of Broadway Avenue and Fremont Boulevard to Monterey-based Orosco and Associates for $1.9 million. But the property had been assessed at $3.5 million, and the city paid $6.2 million for it in 2002.

In exchange for the bargain price, the city required Orosco to develop the property into an upscale commercial shopping center, intended to anchor the so-called “Urban Village” redevelopment area along Broadway.

Three years later, as the nation’s economy dives, the city prepares the environmental impact report for the Urban Village. City Center’s business, meanwhile, is sluggish.

“It’s only a sweetheart deal if the best-case scenario works out,” says City Center developing partner Patrick Orosco. “As a consequence of the economy, it’s definitely not performing as well as we would have hoped. We won’t see any profit from the project, frankly, for a number of years.”

It remains to be seen whether the center will deliver on the city’s expectations. Officials won’t know the property or sales tax revenue from City Center until the end of the year – and the latter is confidential, Deputy City Manager Daphne Hodgson says.

Despite voter approval of a 1 percent sales tax hike last February, Seaside revenues are sinking in relation to expenses. Hodgson estimates the city will run a $2.5 million to $3 million deficit on the adopted 2008-2009 budget.

But Assistant City Manager Jill Anderson sounds her trademark optimistic note. “The City Center was never purposely designed to be a major sales generator,” she says. “It was designed to be a business catalyst.”

Orosco shares Anderson’s vision of City Center as “the cornerstone of the Urban Village”: a walkable, cosmopolitan downtown core with eco-friendly features and apartments stacked on top of businesses. To that end, he says, the developers are pushing Fresh & Easy to engineer its store to LEED green building standards.

But City Center does not incorporate any of the housing that Orosco envisions for the rest of the redevelopment area. And even his talk of bargain rents and growth potential takes a back seat to the reality of a national lending crisis.

“The economy right now is the pits, so everyone right now is waiting to see what happens with the nature of credit,” Orosco says. “In all candor, I don’t expect that we will be able to get tenants to commit.”