The former Nordstrom building in downtown Santa Barbara is one step closer to becoming housing.

The proposal to adapt the Paseo Nuevo building into 112 new housing units earned project design approval from the Santa Barbara Historic Landmarks Commission on Wednesday. 

“A year ago, Paseo Nuevo was a problem,” said Commissioner Dennis Doordan. “We had two huge white elephants right in the center of downtown, the former Macy’s and this building, and today, with this project and the Yardi project for the Macy’s building, we have good cause to be optimistic about the future of State Street.”

Doordan also appreciated that this change isn’t happening because of the demolishing of any buildings, but because of a reconfiguration of existing buildings. 

Since the last design meeting, the project architects have revised the window size and shape and removed awnings proposed for the ground floor. They also removed some of the shallow balconies on the Chapala Street side of the building in response to the commission’s previous feedback.

Many of the balconies are now under doors instead of windows as previously proposed. 

Commissioner Robert Ooley said it was a “vast improvement” on the original design.

“It was a very handsome project when you brought it to us the first time but I think these little tweaks you made have improved it,” Ooley said.

The redevelopment is part of the recently-approved Paseo Nuevo deal which transferred ownership of the former Nordstrom property to DSP — a joint venture of Dune, Shopoff Realty Investments and Praelium.

The deal also transferred ownership of the former Macy’s building and land underneath from the city to Yardi Systems, which will convert the space into its new headquarters.

The Nordstrom store closed in 2020 and Macy’s closed in 2017.

The exterior of the former Nordstrom building at 17 W. Canon Perdido St. will largely remain the same, but with additional windows for the residential units. The center of the building will be carved out to create an interior courtyard, according to the proposal.

Rental units will range in size from 450 to 1,350 square feet, with an average unit size of 794 square feet. Eleven units will be marked as income-restricted for moderate-income households for at least 90 years.

The basement level is set to include a trash collection area, bicycle parking spaces, a residential amenity space, and storage.

Commissioner Ed Lenvik said the designs were a significant improvement from what they saw at the end of July.

“You have simplified it and it’s going to be, I think, very, very pleasant for people that are on the street, observing this building from near and far,” Lenvik said.

Most of the commission’s feedback on Wednesday focused on use of materials and design details such as window depth, color, and the use of awnings throughout the project.

The project will have to return to the Historic Landmarks Commission at a later date for final approval. 

Construction is expected to start next year.