FREMONT - A plan to bring more stores into downtown Fremont could generate $218 million in annual sales by 2010, bringing the city about $2 million in sales tax revenue it has been losing to neighboring communities.

At least that continues to be the hope. This Spring, city officials expect to review the development plan for Capital Avenue, an 11-acre parcel at Mowry Avenue and State Street that includes 5 acres of vacant city property.

A highlight of the plan is extending the avenue, which now ends at state, through the site to create a pedestrian walkway with limited auto traffic.

Blake Hunt Ventures of Danville is co-developing the Capitol Avenue project with Sundhill Development Corp., which owns the Fremont Plaza Retail Center immediately to the North.

That center, which includes a Barnes & Noble bookstore and a Petco pet supply store, would be incorporated into the Capital Avenue project, says Daren Fields, Fremont's economic development director.

The new development, to include up to 250,000 square feet of new retail space, could replace some of the sales tax revenue Fremont has lost in recent years, says Fields.

The 11 acres includes the adjacent site of Fremont Bank and a retail strip center called Gas Light Square. The developers would need to negotiate with the owners of each of those two properties to include them in the redevelopment, says Jerry Hunt, president of Blake Hunt Ventures.

The Fremont City Council 11 months ago selected Blake Hunt Ventures to develop the project with Sundhill.

The site would also be across Fremont Boulevard from The Hub Retail Center, which includes a Target department store, Trader Joe's grocery store and OfficeMax supply store.

"We believe in the viability of a retail downtown in Fremont," Hunt said.