Atascadero moving toward Phase II of downtown transformation

By Mike Chaldu · Wed Jul 29 2026

City now getting ready for next part of El Camino Project, highlighted by gateway structures for both ends of downtown area

ATASCADERO — Atascadero's new version of downtown has been in operation for over a year after completion in 2025 of Phase I of what the city has referred to as the El Camino Real (ECR) Project.

The downtown area, which is located mainly on El Camino Real between Highway 41 (where Colony Cinemas is located) up to Rosario Avenue (at site of the Atascadero Police Department), was transformed from what was a five-lane stretch to now a two-lane (one each way) section of El Camino Real divided by a wide median with extra parking spaces to promote an area powered by pedestrian traffic instead of cars just driving by downtown businesses.

And now, it's time to get started on Phase II of the ECR, as the city plans to get things started on additional aspects of the project, chief among them is the design and construction of two "gateway" entrances at each side of the downtown area, marking downtown as a true region of Atascadero.

Atascadero's Economic Development Manager Loreli Cappel said recently that Phase II is about ready to get off the ground.

"We're going out to bid on the gateway structures in a couple weeks," she said. "We have a $1 million grant from Congressman Jimmy Panetta, and are looking to see what we can do with arches, and possibly full toppers, depending on the bids.

"We really are envisioning the arches serving as bookends to the downtown area, putting one by the movie theater by Highway 41, and the other by the police station at Rosario Avenue. We'd like it to be a homage to the historical neon sign that Atascadero had back in 1920s and ’30s."

Cappel said the city would also like to put some finishing touches on the downtown project.

"We'd like to add things like urns for plants and benches along the area, giving the region the last pieces of the puzzle, depending on how much of the [Panetta grant] is left."

Meanwhile, the city also has some plans for the passageway across the street from the Sunken Garden that goes underneath Highway 101 to Atascadero Avenue, the road that leads to Atascadero High School.

"It's a little dark going through there, and we'd like to make it brighter and even getting lights to change color," Cappel said. "We feel we can make it safer and more exciting for local kids walking to and from school, or residents heading to the football games or other events in the fall."

With the city expected to decide on a bid by the end of the summer, Cappel expects construction to start sometime in the fall and done by the end of the year or the first quarter of 2027.

"We're going with conservative estimates as far as the timetable, in that early 2027 would be the latest it gets done," she said.

While plans are being put in motion for Phase II, the city has observed the effects of Phase I on the area, and Cappel said they are positive.

"Honestly, there's a lot more activity going on downtown now, more people walking around and stopping to patronize the businesses," she said. "It's given people something to do, whether going someplace to eat or doing some shopping."

Cappel adds that businesses are responding.

"Business owners are very excited. It was tough for them when all the construction was happening, but they understood and merchants are planning things to complement the area," she said. "We're getting new investments, public and private, to fill spaces, and we're getting people interested in residences that are part of our mixed-use developments. This is exciting."

Also, the changes on El Camino Real have made the area safer for pedestrians, Cappel claimed.

"Now that it's down to one lane, people aren't going 45 mph anymore," she said. "Accidents have been reduced and people are going slower. And the new crosswalks we put in have been working to get people across ECR safely."

One last positive aspect of the ECR came earlier this year, when the city received numerous awards from city planning organizations such as the American Society of Civil Engineers (ASCE), American Planning Association California Chapter (APACA), and American Public Works Association (APWA), with credit shared among the city's planners, public works employees, and crew members.

"We take great pride in the recognition earned by our city employees, though we are not surprised," Cappel said.

For information and updates on the city's various public projects, go to atascadero.org/project-directory

Feature Image is an archived historical image of the previous Atascadero sign that hung over the street.