SAN JOSE -- After years of on-again, off-again proposals to revitalize a five-acre parcel in San Jose's Japantown, the City Council on Tuesday will get its first look at a new plan that would beef up the historic area with new housing, retail, a park and performance space.

The city's former Corporation Yard, bounded by Jackson, Taylor, Sixth and Seventh streets, was formerly used to store and maintain city-owned vehicles. Before that, it was the site of San Jose's last Chinatown.

The vision of the yard's reuse for residential and commercial development has been discussed by the city and its Japantown community for some time, most notably since the city agreed in 2005 to relocate its vehicle facility to the Central Service Yard on Senter Road.

Under the terms of the development outline, Portland, Ore.-based developer Williams/Dame & Associates would buy the land for $24 million, and build 600 rental units in several towers capped at six stories high. Some 6,000 to 12,000 square feet of retail space, an amphitheater and green space for the local farmer's market also are proposed.

Another three-quarters of an acre would be dedicated to a space for a Creative Center for the Arts, a permanent home for not only the San Jose Taiko drum troupe, but CreaTV and the Arts Council of Silicon Valley.

That facility, however, would have to be paid for by those groups.

"Personally, I'm very pleased they are coming back on board -- this is round two for Williams/Dame, and round three for a developer,'' said Roy Hirabayashi, president of the Japantown Community Congress of San Jose, whose members represent churches, service groups, businesses and neighborhood associations in the area.

"This plan actually fits in naturally with Japantown, not only with what is existing currently, but also reflects the history of what was Japantown, and Chinatown, too,'' said Hirabayashi, a co-founder of San Jose Taiko, which is celebrating its 40th anniversary.

In fact, for many in the community, the current proposal is a much better outcome with the same developer whom the city in 2007 had selected to build 600 townhouses and condominiums that would have soared 12- to14-stories high -- something many Japantown residents and business owners believed to be incompatible with the neighborhood's character.

But in early 2008, faced with the country's deepening economic crisis, Williams/Dame backed off from the project.

During the past 12 to 18 months, as the local economy has rebounded with regional job growth that has spurred apartment building here and elsewhere, the city reached out to Williams/Dame, which returned with an updated proposal.

While the council Tuesday is being asked to approve the outline of the deal and to authorize city staff to continue discussions with the developer, Williams/Dame must still secure a financing partner for the project.

In about six to eight months, if all goes well, the council would then be asked to vote on the sale of the land, said Nanci Klein, deputy director with San Jose's Office of Economic Development.

"I think we're very much on the right track now," said Klein, who called the latest plan a "good opportunity to develop city land for uses that are strategic, but even more important, it's really smart for Japantown."

Moreover, Klein noted, the land sale also will help the city re-pay its $24 million debt service from moving the former operations at that site to the Central Service Yard.

Both Klein and Hirabayashi said there are still concerns about adequate parking and traffic safety that have to be addressed. But city staff said some reduction in traffic will be achieved because the 600 units, which will be marketed to young professionals, seniors, singles and empty-nesters, will be smaller than San Jose's average 1,400-square-feet apartments.

As a result, the developer believes that less parking would be required with smaller units, and it "would explore'' providing Eco-Passes and Zip cars for renters.

Contact Tracy Seipel at 408 275-0140.