Exhibit 2 - Letter of Justification with Proposed Density Bonus Concessions, Waivers, and Parking ReductionsDirect No.: 415.655.8114
ephillips@bwslaw.com
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San Francisco, California 94111-5432
voice 415.655.8100 - fax 415.655.8099
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March 6, 2025
Jocelyn Shoopman
Senior Planner
Town of Los Gatos
Community Development Department
110 E. Main Street
Los Gatos, CA 95030
Re: Supplemental Material for 14859 Los Gatos Blvd and 16270 Burton Road
(APN 424-07-009, -053, -081, -094, -095, -115, -116, and -052)
Architecture and Site Application S-23-031
Subdivision Application M-23-005
Dear Ms. Shoopman:
On behalf of Grosvenor Property Americas (“Applicant”), we are pleased to submit
further updates to our complete application for a development project at 14859 Los Gatos Blvd
and 16270 Burton Road (“Project Site”) in the Town of Los Gatos (“Town”) to develop 450
homes, 15,000 square feet of retail, over 3,000 square feet of commercial and civic space, and
associated on- and off-site improvements (the “Project”).
The Applicant submitted a complete preliminary application for the Project on April 18,
2023, and followed with its formal development application on September 18, 2023. The Town
found the application complete on April 17, 2024. The Town’s completeness determination
included numerous substantive comments regarding the Project. The Applicant supplemented its
complete application in May of 2024, and the Town issued a series of written consistency
evaluation letters on July 17, 2024. The Applicant submitted additional information on October
3, 2024, which triggered further comments from the Town on October 30, 2024. The Applicant
responded with revisions on November 23, 2024, and the Town provided additional written
comments on December 23, 2024. Since then, the Applicant team and the Town staff have had
ongoing meetings and exchanged written comments. Based on those discussions we believe that
this submittal fully responds to the comments raised by the Town in its December 23, 2024
letters.
EXHIBIT 2
March 6, 2025
Page 2
I. Updated Project Description.
The Applicant proposes the construction of the Project, a mixed-use housing
development project that includes 450 homes, 15,000 square feet of retail, over 3,000 square feet
of commercial and civic space, and associated on- and off-site improvements located in the
North 40 Specific Plan area of the Town.
The Project Site is 15.65 total acres, which includes unbuildable areas, areas planned for
open space, and all of the land that will be dedicated to the public for access to the Project’s
circulation system and public utilities. Excluding the primary backbone public infrastructure and
circulation portions of the Project Site that will be dedicated by easement for public use results in
a lot area of 14.47 acres, which conservatively includes alleys, open space, and undevelopable
land on the Project Site.
The Project Site currently includes eight (8) single family homes, which would be
demolished (as anticipated in the previously certified North 40 Specific Plan Environmental
Impact Report) and replaced by the Project.
The Town’s Housing Element includes the Project Site in its inventory of sites available
for housing development that will be affordable to lower income households to accommodate the
Town’s RHNA. The Housing Element designates the Project Site for residential development at
a minimum density of at least 30 dwelling units per acre, and it assumed a development capacity
of up to 461 units. The Project proposes 450 dwelling units on a site area of 14.47 acres,
resulting in a gross density of 31.1 du/ac, which is consistent with the Housing Element’s use
and density designations.
The Project’s residential program will provide a total of 450 new rental apartments and
for-sale and/or rental town homes. Of the 450 total units, the Project will dedicate 77 units as
units that will be rented to lower income households, as defined in Section 50079.5 of the Health
and Safety Code as affordable rents, as defined in Section 50053 of the Health and Safety Code.
The 77 dedicated units will include 67 affordable rental homes available to low and very low-
income households (in addition to one unit reserved for a manager) on approximately 1.25 acres
that will be transferred to an affordable housing developer. Ten additional units dedicated to
low-income households will be made available in the Project’s mixed-income multi-family
building.
The 450 homes are complemented by various resident amenities and community-serving
ground floor commercial spaces within the multi-family rental building. The new buildings are
arranged around a generously sized central public open space (the “Meadow”), open to all and
visible from Los Gatos Boulevard along a pedestrian “Paseo”. The Meadow will feature active
uses, landscaping, and an interpretive display that features the existing red barn, that collectively
celebrate the Property’s agricultural heritage. The Meadow will also include a new public
March 6, 2025
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pavilion, which is designed to be adaptable for a variety of civic, community and/or retail uses
for future flexibility.
Adjacent to the public open space, a 2,400 square foot barn-inspired commercial space,
Building J, is proposed and envisioned to complement both the Meadow’s agrarian theme and
the retail uses in Building I. A new 4,800 square foot retail building (Building I) is located
closer to Los Gatos Boulevard and is designed to be sub-dividable for multiple tenants and
includes generous outdoor dining areas. Building J and Building I are part of approximately
15,000 square feet of commercial space that helps create vibrancy and a sense of place.
The Project includes all necessary access, circulation, streetscape, and landscaping to
complement and service the new buildings and to complete relevant sections of the bicycle and
pedestrian routes through and around the site. On-site streets will be connected to existing North
40 Phase I streets. The Applicant will dedicate land to the Town to accommodate the future
widening of Burton Road and a through-connection between Burton Road and the Project to
complete the internal circulation system as anticipated in the North 40 Specific Plan.
II. The Project is Consistent with Applicable Objective Development Standards.
On January 31, 2023, the Town adopted its first version of the Sixth Cycle Housing
Element Update, which was adopted and in effect when the Applicant submitted its complete
preliminary application. The California Department of Housing and Community Development
(“HCD”) found that the Town’s January 31, 2023 Housing Element did not substantially comply
with the requirements of state Housing Element law. The Town made numerous revisions to its
Housing Element in response to HCD’s findings before adopting a substantially compliant
Housing Element that HCD certified on July 10, 2024. However, because the Project has a
vested right to proceed under the ordinances, policies, and standards in place at the time the
Applicant submitted the preliminary application, the January 31, 2023 Housing Element applies.
(See Gov. Code § 65589.5(o).)
The Project proposes to provide 77 of its 450 dwelling units at rents affordable to lower
income households as defined in Health and Safety Code section 50079.5. Therefore, the Project
is “housing for very low, low-, or moderate-income households” as defined in the Housing
Accountability Act. (Gov. Code § 65589.5(h)(3).) In addition, as discussed above, the Project is
consistent with the Housing Element’s land use and density designations. Because the Town
identified the Project Site “as suitable or available for very low, low-, or moderate-income
households” in its Housing Element, and the Project is consistent with the Housing Element’s
specified density, the Town may not “disapprove or conditionally approve” the Project,
notwithstanding potential inconsistencies with the Town’s “zoning ordinance [including the
North 40 Specific Plan] and general plan land use designation.” (Gov. Code §
65589.5(d)(5)(A).) This means that the Town’s Housing Element overrides the North 40
Specific Plan’s requirement as applied to the Project.
March 6, 2025
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Because the Project provides 77 of its 450 dwelling units as affordable to lower income
households, it is eligible for benefits under the State Density Bonus Law, including two
concessions/incentives that result in cost reductions and unlimited waivers of development
standards necessary to accommodate the Project as proposed. (Gov. Code § 65915(d)(2)(B), (e).)
Attachment A to this letter includes a complete enumeration of all requested
incentives/concessions and waivers, and the updated Objective Design Standards checklist
references such modifications where appropriate.
Finally, the Project complies with the Town’s affordability requirements as adopted in
the BMP Ordinance (Division 6 of Chapter 29 of the Town Code). Of the Project’s 450 total
units, 373 units would be rented or sold at market rate. The Town’s BMP Ordinance requires
that 20 percent of the 373 market rate units – or 75 units – be reserved as affordable housing.
The Project exceeds this requirement and will dedicate 77 units (21 percent of the market rate
units) as units dedicated to lower income households, as defined in Section 50079.5 of the Health
and Safety Code as affordable rents, as defined in Section 50053 of the Health and Safety Code.
Note that because the Project’s complete preliminary application was submitted before
the Town adopted a Housing Element certified by HCD, the Project is eligible for the Builder’s
Remedy. This means that Town would be forbidden from denying the Project, even if the
Project were not consistent with the Town’s standards. Although the Project is eligible for the
Builder’s Remedy, it is not necessary to invoke the Builder’s Remedy here, because the Project
complies with the Housing Element and applicable, objective standards as modified via the State
Density Bonus Law.
III. Conclusion
With this submittal, the Applicant has responded to each of the Town’s substantive,
applicable comments provided on December 23, 2024, and during subsequent conversations and
meetings with Town staff. Accordingly, we look forward to the Project’s Planning Commission
hearing in April.
Sincerely,
Eric S. Phillips
Encls.
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ATTACHMENT A
14859 Los Gatos Blvd and 16270 Burton Road
(APN 424-07-009, -053, -081, -094, -095, -115, -116, and -052)
Architecture and Site Application S-23-031
Subdivision Application M-23-005
Proposed Density Bonus Concessions, Waivers, and Parking Reductions
Although the Project meets many of the General Plan policies, including the land use and density
designated in the Housing Element, and the guidelines of the North 40 Specific Plan, the
Applicant seeks incentives or concessions, waivers, and parking reductions pursuant to the State
Density Bonus Law (Gov. Code § 65915).
The Project will dedicate 77 of its 450 units to be rented to lower income households, as defined
in Section 50079.5 of the Health and Safety Code at a monthly cost that is an affordable rent, as
defined in Section 50053 of the Health and Safety Code. Note that this level of affordability
equals 21 percent of the Project’s market rate units, which exceeds the affordability requirements
in the Town’s BMP Ordinance. In addition, by providing this level of affordability, the Project
is entitled to the following benefits under State Density Bonus Law:
• A density bonus of 30.5% above the otherwise maximum allowable residential density
(Gov. Code § 65915(f)(1);
• Two incentives or concessions (Gov. Code § 65915(d)(2)(B); for purposes of the State
Density Bonus Law, the terms “incentives” and “concessions” are interchangeable, and
this summary will use “concession” going forward);
• Waivers or reductions for “any development standard that will have the effect of
physically precluding the construction of a development” that provides enough affordable
housing to qualify for the State Bonus Law (Gov. Code § 65915(e)); and
• Minimum parking requirements, inclusive of guest parking and including parking
provided in uncovered or tandem spaces, that do not exceed specified ratios. (Gov. Code
§ 65915(p).)
As detailed below, the Applicant proposes to use the State Density Bonus Law’s concessions,
waivers, and parking reduction benefits to allow the development of the Project as proposed. In
addition, the Applicant reserves the right to modify the request to include different or additional
concessions and waivers if needed to address additional applicable development standards.
Concessions
1. Allow residential uses on the ground floor of buildings. Section 2.5.10c of the North 40
Specific Plan prohibits residential uses on the ground floor of buildings in the Northern District,
which covers the Project site. Because the Housing Element designates the Project site as a site
that is suitable for very low, low‐, or moderate‐income households at a residential density of at
least 30 du/ac, inconsistency with this zoning standard is not a basis to deny the Project under
Government Code section 65589.5(d)(5)(A). Accordingly, we do not believe that this standard is
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applicable to the Project. However, to the extent it applies, the Project proponent requests a
concession to allow residential uses on the ground floor of buildings.
Although portions of the Project incorporate commercial elements, it is not financially feasible to
develop commercial spaces on the ground floor of all the buildings on the Project site. Therefore,
eliminating this development standard will result in cost savings to help provide the level of
affordability proposed.1
2. Potential Reduction in Private Open Space. (Townhomes only) The Town adopted
“Objective Design Standards for Qualifying Multi‐Family and Mixed‐Use Residential
Development” that applies to multi‐family and residential mixed‐use developments. Objective
Design Standard A.11.1.b requires each ground floor dwelling unit to have a minimum of 120
square feet of usable private recreation space. As currently designed, the Townhomes satisfy this
requirement through the provision of private roof decks. However, to reduce construction costs,
it may be necessary for the Project to remove some or all of the roof decks before submitting for
building permits, which would cause the Project to fall short of the open space standard.
Therefore, the Project requests a concession to remove private roof decks from the design at the
Applicant’s election to result in cost savings to help provide the level of affordability proposed.
Waivers
When considering the following proposed waivers, it is important to remember that “[i]n no case
may [the Town] apply any development standard that will have the effect of physically
precluding the construction of a development [that qualifies for the State Density Bonus Law] at
the densities” allowed and with the requested concessions. (See Gov. Code, § 65915(e)(1).)
Cases have confirmed that once a project qualifies for a density bonus, “the law provides a
developer with broad discretion to design projects with additional amenities even if doing so
would conflict with local development standards.” (Bankers Hill 150 v. City of San Diego (2022)
74 Cal.App.5th 755, 774-75; see also Wollmer v. City of Berkeley (2011) 193 Cal.App.4th 1329,
1346–1347 [waivers must be granted even though redesigning thee project to decrease amenities
would reduce the need for waivers].)
1. Increased Maximum Height. Section 2.5.2 of the North 40 Specific Plan and referenced in
Policy LU5 sets a maximum building height of 30 feet across the Project site and Section
2.5.7(b) sets a maximum building height of 25 feet for buildings located within 50 feet of Los
Gatos Boulevard. The Project requires a waiver to allow the Affordable Multifamily (Building
G) units to achieve a maximum height of 63 feet measured from the lowest natural grade to
highest roof surface or 61 feet when measured from the proposed grade, and the town home units
to achieve a maximum height of 49 feet when measured from the lowest natural grade or 44 feet
when measured from lowest proposed grade, and the Mixed‐Income Multifamily (Building E)
units to achieve a maximum height of 100 feet from when measured from the lowest natural
grade to the highest roof surface or approximately 94 feet when measured from the lowest
1 See HCD Notice of Violation to City of Elk Grove (October 12, 2022), which concludes that allowing residential
ground floor development in mixed use areas that otherwise require ground floor commercial uses results in actual
and identifiable cost reductions such that refusal to approve a concession would violate the State Density Bonus
Law.
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proposed grade. It should be noted that Building E is approximately 89 feet when measured from
Los Gatos Boulevard and that detailed measurements are included in the updated architectural
sheets in the attached revised drawings (Planning Comments 18, 27 and 29). The Specific Plan’s
development standards do not accommodate the Project’s proposed density, which is allowed
pursuant to the adopted Housing Element. Increased height is necessary for each proposed
building typology to accommodate the proposed unit count and necessary parking facilities
across the Project site.2, 3
2. Modified Street Sections. Section 4.13.3 of the North 40 Specific Plan defines a 40’ road
section for Section 6d of North A Street with two 12’ drive lanes and two 8’ parking lanes. The
Project proposes wider sidewalks, bicycle lanes, and reduced lane widths; accommodating all of
the proposed facilities in the street would require additional right of way that would reduce the
amount of developable area for buildings, resulting in a lower unit count. Therefore, the Project
proponent requests a waiver from the required street section dimensions.
3. Deviations from Objective Design Standards. The Project has been designed to comply with as
many of the Objective Design Standards as feasible while meeting the unit count called for in the
Housing Element; however, to physically fit the Project as designed at the density allowed, the
following standards must be waived:
• A.2.1. (100% affordable multifamily housing, townhomes, and commercial buildings
only) Short-term bicycle parking cannot be accommodated within 50' of each building
entry while maintaining adequate space for residential density and proposed open space.
In the alternative, the project distributes bike parking throughout the site to balance even
distribution and convenience, while also supporting active community use.
• A.2.2. (100% affordable multifamily housing, mixed-use multifamily, and townhomes)
Long-term bicycle parking is provided at one space per unit. To maintain adequate space
for residential density and proposed open space, short-term bicycle parking is provided at
a ratio of one space per 2,000 square feet of non-residential floor area.
• A.3.4.e. (100% affordable multifamily housing and mixed-use multifamily only) To
maintain adequate space for residential density and proposed open space, long‐term
bicycle spaces are proposed to be accommodated with stacked parking. Although the
proposed bicycle racks would not meet the Objective Design Standards’ dimensions, a
reduction is necessary to provide adequate long-term bicycle parking without reducing
the Project’s residential density.
• A.5.1. (Commercial building only) The project is designed to prioritize the pedestrian
experience and active ground-floor retail uses where the buildings have frontage on C1
Street, D4 Street, and the Pedestrian Paseo, which is proposed as a Project amenity
serving the public and future Project residents. It is necessary to locate surface parking
2 In some cases, the height waivers proposed may exceed the more precise heights shown on the architectural plans.
We propose rounding the height up to nearest foot to allow for some variance between the current plans and final
construction plans.
3 See HCD Notice of Violation to City and County of San Francisco (December 29, 2022), which concludes that it is
a violation of the State Density Bonus Law to approve a project subject to a condition of approval that the applicant
reduce the height proposed as a waiver.
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between the buildings and Los Gatos Boulevard, otherwise the Project would need to be
redesigned to remove the proposed amenity or reduce its residential density.
• A.6.3, (Mixed-use multifamily only) The multifamily building has a parking structure,
and a pedestrian access gate cannot be provided without redesigning the Project and
affecting its density. Pedestrians can access the exterior by using an elevator, corridor or
stairs.
• A.10.2. (Mixed-use multifamily and townhomes only) The Project requires a new
unbroken retaining wall between C5 Street and the neighboring property so long as the
adjacent grade remains lower than the Project Site’s grade to support development at the
permitted density.
• A.11.1.b. (100% affordable multifamily housing and mixed-use multifamily only) The
100% affordable multifamily building cannot accommodate balconies and cannot meet
the private open space requirements while maintaining the unit count. The mixed-use
multifamily building can accommodate balconies on only 49% of the units (126 units)
without reducing Project density.
• A.12.1. (Mixed-use multifamily and commercial buildings only) The Project proposes a
Paseo to connect Los Gatos Boulevard to the Meadow, which would house the ground
floor retail consistent with the Project’s first concession request and serve as a Project
amenity serving the public and future Project residents. Providing 75 percent of any
street-facing façade would require a Project redesign to remove the proposed amenity and
conflict with its concession request.
• B.1.1. (Townhomes only) The primary street-facing façade of the townhomes complies
with B1.1.1b, c, and f. However, since each facade of the townhomes faces a street,
depending on siting, it is not possible for the townhomes to comply with the requirement
that all street-facing facades incorporate three of the identified design solutions.
• B.1.2. (100% affordable multifamily housing and mixed-use multifamily only) An upper-
story setback would reduce the density of the Project.
• B.3.1. (Mixed-use multifamily only) The mixed‐use multifamily building (E1) cannot
comply with the requirement to install horizontal eave breaks every 40 feet of building
façade without redesigning the Project and reducing its density.
• B.4.1. (Townhomes only) Townhomes comply at Front Facade of each building, but
redesigning the Project to differentiate the base of the buildings at the Rear/Garage or
Side Facades would affect the overall residential capacity by reducing the building form
and floor area for the Project’s residential uses.
• B.4.3. (100% affordable multifamily housing and townhomes only) The 100% affordable
multifamily building (6 points) and the townhomes (14 points) cannot reach 16 points
through street‐facing façade plan variation while maintaining the unit count.
• B.4.4. (Townhomes only) The Project proposes the Meadow as an amenity serving the
public and future Project residents. Townhomes H1 and H2 are designed to face the
Meadow rather than the street to activate this project amenity. As a result, the garage
doors on these two townhomes exceed 40 percent of the length of the façade; otherwise,
the Project would need to be designed to modify the proposed amenity or reduce its
residential density.
• B.4.6.b. (Commercial building only) The Project proposes a Paseo to connect Los Gatos
Boulevard to the Meadow, which would house the ground floor retail consistent with the
Project’s first concession request and serve as a Project amenity serving the public and
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future Project residents. To activate the Paseo and accommodate the design of this
Project amenity consistent with the Project’s concession request, the commercial
buildings deviate from the façade requirements.
• B.4.10. (Townhome F3 only) Townhome B3 is adjacent to a single-family use and cannot
be designed to set back five additional feet from the façade plan of the lower floor
without reducing the project’s residential development capacity.
• B.4.11. (Mixed-use multifamily building and townhomes only) The mixed-use
multifamily building’s balconies extend into the airspace beyond the building footprint,
as does the balcony for Townhome F3. This encroachment must be allowed to
accommodate the project’s residential density and open space amenities.
• B.4.13. (Mixed-use multifamily building only) The mixed‐use multifamily building (E1)
cannot comply with the façade requirement without redesigning the Project and reducing
its density.
4. BMP Program Standards. As noted above, because the Project is consistent with the Housing
Element’s designated density for the Property and because it reserves 77 of its units as affordable
to lower income households, the Housing Accountability Act prohibits the Town from denying
the Project based on inconsistencies with zoning standards, including the Town’s BMP Program.
However, to the extent applicable, we request a waiver from the BMP Program requirement to
provide affordable units proportionately in the same unit type mix as the market rate units and to
have the units be dispersed throughout the Property. Because the Project would involve a
partnership with a non‐profit developer to provide affordable housing units using tax credits and
other financing mechanisms that require the affordable units be consolidated, compliance with
the BMP Program requirements would physically preclude development of the Project.
Likewise, requiring larger affordable units would result in few units per building, reducing the
Project’s density.
Parking Reductions
Consistent with the standards established in subdivision (p) of Government Code section 65915,
the Applicant proposes that the mixed-use multifamily housing building and the townhomes be
subject to the following minimum parking ratios, inclusive of guest parking:
• Zero to one bedroom: one onsite parking space;
• Two to three bedrooms: one and one‐half onsite parking spaces; and
• Four and more bedrooms: two and one‐half parking spaces.
Note that the 100% affordable multifamily housing building complies with the Town’s parking
standards, which require less parking than the State Density Bonus Law. Therefore, this portion
of the request is not applicable to the affordable housing component of the Project.
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