The URL can be used to link to this page

Attachment 28 - Letter from Applicant-Appellant, received September 27, 2017Buchalter September 27, 2017 VIA E-MAIL Mayor Sayoc and Councilmembers Los Gatos Town Council 110 E. Main Street Los Gatos, CA 95031 5 5 Second Street Su ite 170 0 San Fr ancisco, CA 94105 4 15 .2 27 .0900 Phone 41 5 .227.0 770 Fax File Number: L434 2-0002 4 15.22 7 .3508 Direct aguerra@buchalter.com Re: 401-409 Alberto Way-Architecture and Site Application S-15-056, Conditional Use Permit Application U-15-009, and Environmental Impact Report EIR-16-001. Property Owner: CWA Realty. Applicant/Appellant: LP Acquisitions, LLC. Appeal of a Planning Commission Denial of Request to Demolish Three Existing Office Buildings and Construct a New, 2-Story Office Building with Below Grade and At-Grade Parking on Property Zoned CH. APN 529-23-018. Dear Mayor Sayoc and Members of the Town Council, Buchalter represents LP Acquisitions, the developer of the project located at 401-409 Alberto Way in Los Gatos ("Alberto Way Project" or "Project"). First, on behalf of my client, we thank you for considering the Alberto Way Project and our request that you overturn the Planning Commission's denial of the Project approvals as referenced above. Secondly, at your meeting of September 19, 2 017, the Los Gatos Town Council closed the public hearing but invited the applicant and the public to submit written comments for the Council's consideration at its upcoming meeting of October 3 , 2017 concerning the Project. Accordingly, the purpose of this letter is to address several key comments that were submitted to you as desk items or that were made at the September 19th Council Meeting in an effort to address any remaining questions about the Project in anticipation of your deliberations at next week's meeting. B N 3 1090566vl ATTACHMENT 2 8 buchalter.com Los Ang ele s Na pa Valley Orange Co un ty Sacramento San Fra ncis co Scottsdale Buchalter Mayor Sayoc and Councilmembers September 27, 2017 Page2 No new comments were submitted that undermine the adequacy of the EIR or the Project approvals. Importantly, all of the comments submitted last week opposing the Project are the same comments that commenters opposing the Project submitted to the Town in August 2016, and in March 2017 , April 2017, and again, in May 2017. Many of these are the same comments presented at the May 10, 2017 Planning Commission meeting. None of the comment letters' included in the September 14, 2017 Staff Report and none of the desk items submitted on September 19th contain any new comments or any information indicating that the Project would result in new significant environmental impacts, and specifically any impacts related to hydrology, geology, traffic (see Exhibit A), aesthetic and visual impacts. As we stated in our May 9, 2017 letter to Jennifer Armer, when an agency prepares an environmental impact report (EIR), the issue is whether substantial evidence supports the agency's conclusions, not whether others might disagree with those conclusions (see e.g., North Coast Rivers Alliance v. Marin Municipal Water Dist. Bd. of Directors, 216 Cal.App.4th 614, 624 (2013)). The extensive analysis and information contained in the EIR and the Town's administrative record demonstrates that substantial evidence supports the conclusion that all significant environmental impacts have been mitigated to a less than significant level, and the Town Council may find that the Project complies with the Town's General Plan, zoning and Commercial D~sign Guidelines as further discussed below. That finding has not changed in light of the same comments that were submitted prior to the September 19th Council meeting. If the Council grants the appeal, substantial evidence supports the Council's certification of the EIR and approval of the Revised Project. One commenter suggested that while they urge the Council to uphold the Planning Commission's denial, if the Council chooses to grant the appeal and approve the Project, they asked the Council to remand the matter back to the Commission. They also believe the Planning Commission was not under an obligation to adopt any findings or to certify the EIR in light of the comments contained in the administrative record. We recognize the Planning Commission and the Town Council have discretion in applying the Town's General Plan policies, zoning regulations, and Commercial Design Guidelines in reaching a decision as to whether or not to approve the Architecture and Site Application (S-15-056) (ASA) and the Conditional Use Permit U-15-009 (CUP) for the replacement of the existing office buildings with a new office building. But even discretionary actions require findings and the findings must be supported by substantial evidence as explained in our May 19, 2017 appeal. As the California Supreme Court explained in the seminal case, Topanga Association for a Scenic Community v . County of Los Angeles, 11 Cal.3d 506 (1974), this findings requirement particularly applies to decisions, such as those at issue here, which are in adjudicatory in nature. Findings are needed in order to enable the parties to determine BN 31090566v I Buchalter Mayor Sayoc and Councilmembers September 27, 2017 Page 3 whether and on what basis they should seek review. If findings are not provided to "bridge the analytic gap between the raw evidence and the decision," then neither the applicant/appellant nor the public will be able to determine the basis of the agency's decision. That is the problem here. The Planning Commission was all over the map in terms of its expectations regarding a reduced project size when substantial evidence showed the Reduced Scale Alternative was found infeasible. The record reflects that some of the commenters requested that the Project be even smaller and closer to the square footage of the existing buildings, but the EIR determined that this version of the "No Project" alternative would fail the basic project objectives. While commenters and the Commission expressed concern about the Revised Project being "too big," 80-90% of the Commission's requested revisions were incorporated into the Revised Project as noted in the administrative record. For example, the revised design would actually be lower in height than the tallest point of the existing buildings. Similarly, the proposed buildings would be set back from the street frontage in a manner to further protect views when compared to the existing buildings, freeway, landscaping, and other developed conditions on the property that currently block views of the Santa Cruz Mountains today from various vantage points. Notwithstanding the evidence in the record, the Planning Commission never explained how reducing the size of the building by another 9,000 square feet would reduce the neighbors ' concerns . In that way, my client and the Council were left to guess at what an acceptable square footage could be because the Town's policies do not provide any clarification on this point. Because the Commission rejected the Revised Project even in the face of substantial evidence in the record and findings that supported staffs recommendation to approve the Revised Project, we request that the Council exercise its discretion and adopt findings in support of granting the appeal and approving the Revised Project in accordance with the Town Municipal Code. Downtown shuttle service analysis demonstrates further reduction in Project trip generation. The Alberto Way Project includes a Transportation Demand Management (TDM) Program as discussed in the EIR. The TDM Program includes the use of a shuttle service ("CAT" -Community Area Transit) available for future employees of the proposed office building. As stated at prior neighborhood meetings, the Planning Commission meetings and last week's Council meeting, LP Acquisitions also agreed to make free Downtown shuttle service available to nearby residents for their trips to Downtown retail businesses and services. Some neighbors expressed concern that the use of the CAT would not reduce Project- generated traffic. Shuttle service is a standard form of transportation demand management and is often used as a mitigation measure to further reduce trip generation. Exhibit B contains a memorandum prepared by Hexagon that estimates the trip reduction that may be achieved with employee and resident use of the CAT to amplify the information previously provided in the EIR BN 3 1090566v l Buchalter Mayor Sayoc and Councilmembers September 27, 2017 Page4 and included in our prior written submittals for the Council's consideration. This information shows that there making the shuttle available for daytime use achieves some incidental benefits for the community. LP Acquisitions previously submitted information to the Town regarding the infeasibility of the Reduced Scale Alternative. According to CEQA, Project alternatives should be considered when the Project results in significant impacts. Since the EIR concluded that the impacts of the Original Project could be mitigated to a less-than-significant level that would not significant or adversely affect the environment, technically, a Reduced Scale Alternative would not be necessary to mitigate significant impacts. If anything, both the Revised Project and the Reduced Scale Alternative merely further reduce impacts already found to be less than significant. Nonetheless, several commenters requested that if the Council grants the appeal, that the Council approve the Reduced Scale Alternative, and not the Revised Project. As Mr. Lamb indicated at last week's Council meeting, the Planning Commission was unable to settle on a consistent direction regarding the reduction in the size of the project, and at times seemed to suggest the Project be reduced to the size of the Reduced Scale Alternative. Even though we submitted information indicating that the Revised Project size of 83 ,000 square feet was feasible, the Commission suggested that was not .good enough and they denied the Project because LP Acquisitions was unable to reduce the size of the Project to the size of the infeasible Reduced Scale Alternative. One commenter incorrectly stated in its September l 81h submittal, that LP Acquisitions : " ... has not submitted any data sufficient to show that purported additional costs or decreased profits of a smaller project alternative would render it impracticable to proceed with the Project." (Provencher & Flatt, LLP Letter dated September 18, 2016 (sic) page 4). Exhibit C, however, contains excerpts from the letters LP Acquisitions and Buchalter previously submitted to the Town since June 2016 addressing the question of feasibility of the alternatives. As you will see, this information explains why the Revised Project is feasible, and why the 74,260 square foot Reduced Scale Alternative identified in the EIR and proposed by the Planning Commission was not feasible from a cost perspective. We also explained in prior correspondence how the Reduced Scale Alternative failed to meet most of the basic project objectives in accordance with CEQA. Additionally, because the Planning Commission provided conflicting direction as to the scope of any reductions in square footage ranging from 40,000 square to the 74,260 square feet for the Reduced Scale Alternative identified in the EIR, my client used the 74,260 square foot threshold as a proxy for determining whether or not further reductions would fail the feasibility test. In other words, if the Project is infeasible at 74,260 square feet, and if it is infeasible based on the existing condition as reported in the EIR, the BN 31090566vl Buchalter Mayor Sayoc and Councilmembers September 27, 2017 Page 5 Project also fails the test of feasibility at a level below 74,260 square feet. None of the information contained in Exhibit C constitutes new information. For the reasons set forth in Exhibit C, and recognizing that the Revised Project already reflects significant revisions to address the commenters' and Planning Commissions concerns about the massing and scale of the Project (e.g., lowering in building height, greater setback from street frontage, etc.) in afeasible manner, my client submitted information demonstrating its commitment to work with the community to incorporate further reductions in the size and scale of the building. Recirculation of the Draft EIR is not required before the Council were to consider approving the Revised Project. Some commenters requested that the Town recirculate the Draft EIR due to new information that they submitted that alleges the Revised Project would result in new significant geologic and hydro logic impacts, traffic impacts, aesthetic and visual impacts, but just as with the prior comments, the latest comments raise the same issues as the earlier comments opposing the original Project. No information provided in the latest round of comments indicates that the Draft EIR was inadequate or conclusory or that the public was deprived of a meaningful opportunity to review and comment on the EIR. 1 Furthermore, the EIR concluded that all of the significant environmental impacts of the Original Project could be mitigated to a less than significant level. Since the Revised Project is smaller than the Original Project evaluated in the EIR, the Revised Project would result in even fewer and lesser environmental impacts than the Original Project. This is also the case for the Reduced Scale Alternative which was similarly analyzed in the EIR, for which the Town concluded the impacts would be proportionately reduced. Section 15126.6 (d) of the CEQA Guidelines provides that an EIR 's analysis of alternatives shall be limited to feasible alternatives "that would avoid or substantially lessen" any of the Project's significant environmental impacts. In this case, the EIR contains information regarding the environmental impacts of a Reduced Scale Alternative even though neither the Original Project nor the Revised Project would result in any significant environmental impacts, and even though substantial evidence indicates that the Reduced Scale Alternative would be considered infeasible. Thus, the Project EIR complies with CEQA and the Town Council is not required to recirculate the EIR prior to considering approval of the Revised Project, because there are no new significant impacts nor is there a substantial increase in the severity of the impacts previously evaluated in the EIR. 1 In fact, we note that in its denial, the Planning Commission relied on information contained in the Dra ft EIR to decide to deny the Revised Project (because the Revised Project was reduced to the size of the infeasible Reduced Scale Alternative) before they reviewed the EIR, just so they would not have to certify the EIR. BN 31090566vl Buchalter Mayor Sayoc and Councilmembers September 27, 2017 Page6 We respectfully request that the Council consider grant the appeal, certify the EIR, and consider approving the ASA and CUP at its meeting next Tuesday. We appreciate your consideration of the enclosed information and look forward to the Town Council's continued deliberations regarding the Alberto Way Project next. Tuesday. Sincerely, BUCHALTER essfe.~orporation By Exhibits cc (via email): Clerk Administrator BN 3l090566vl Laurel Prevetti, Town Manager Rob Schultz, Town Attorney Joel Pa\llson, Community Development Director Jennifer Armer, Associate Planner Randy Lamb, LP Acquisitions Shane Arters, LP Acquisitions Jolie Houston, Berliner Cohen Dan Orloff, Orloff Williams Dan Kirby, ARC TEC, Inc. EXHIBIT A ~ n cm • • ~ , \ -0-,,. • o~ • ~ Q , ' bJ • • .... A ~[XAGON T~ANSPO~TATION (ONSULTANTS, IN<. Memorandum Date: To: From: Subject: September 19, 2017 Shane Arters, Lamb Partners Gary Black Ollie Zhou Traffic Analysis of the Proposed Downtown Shuttle Service for 401 Alberto Way Office Project Hexagon Transportation Consultants, Inc. has completed a traffic analysis of the proposed Community Area Transit Free Downtown Shuttle Service in Los Gatos, California. This shuttle service is being proposed as part of the proposed 401-409 Alberto Way office development located at the northwest quadrant of the intersection of Alberto Way and Los Gatos-Saratoga Road. The shuttle would be available to the public and is proposed to run with a 30-to 45-minute headway between 10:30 AM and 3:30 PM on weekdays as well as on a select number of weekends. The shuttle would depart the proposed office development at 401-409 Alberto Way and travel clockwise eastbound on Los Gatos-Saratoga Road, southbound on Los Gatos Boulevard/Main Street, northbound on Santa Cruz Avenue, eastbound on Andrews Street, southbound on University Avenue and eastbound on Los Gatos-Saratoga Road (see Figure 1 ). The shuttle would stop at the Masonic Hall, Town Hall , Los Gatos Town Park Plaza, Downtown Los Gatos and the Walgreens and Safeway on Santa Cruz Avenue. Based on the proposed 30-to 45-minute headway, it is anticipated that the shuttle service would provide 6 to 10 roundtrip services through downtown Los Gatos between 10:30 AM and 3:30 PM. Assuming a maximum 30-person capacity for the shuttle , this free shuttle service could potentially serve a maximum of 300 passengers (30-person capacity with 10 roundtrips) per day. While most of the passengers are expected to be future employees at the proposed office development, it is anticipated that some residents along Alberto Way would also utilize this shuttle service , thus reducing the number of vehicle trips between Alberto Way and downtown Los Gatos. Residents in downtown Los Gatos could also ride this shuttle to the Walgreens and Safeway on Santa Cruz Avenue, and employees on Main Street could also ride this shuttle to downtown Los Gatos during lunch time. Assuming 20% of all passengers were induced to make the trip because of the shuttle service (meaning they would not have made a trip without the shuttle service), the remaining 80% of the passengers (maximum 240 passengers) would have made the trip by driving their own car otherwise. Assuming 80% of the passengers that were making the trip regardless of the shuttle service are future employees, and employees travel in pairs (two per car), the shuttle service could eliminate a maximum 96 vehicle trips per day that would have been made by employees at the proposed office development driving to downtown Los Gatos. Assuming the remaining 20% of the passengers that were making the trip regardless of the shuttle service are local residents, and residents drive alone, the shuttle service could eliminate a maximum 48 vehicle trips per day that would have been made by residents driving to downtown Los Gatos. Therefore, assuming a 30- minute shuttle headway and the shuttle has a 30-person capacity, the proposed shuttle service could eliminate maximum 144 vehicles per day. There would also be comparable savings in greenhouse gas emissions. 4 North Second Street, Suite 400 • San Jose, California 9S113 • phone 408.971.6 100 • fax 408.971.6102 • www.hextrans .com EXHIBITB ~~XAGON T~ANSPO~TATION (ONSU l TANTS, IN<. September 27, 2017 Mr. Randy Lamb Lamb Partners 535 Middlefield Road, Suite 190 Menlo Park, CA 94025 Subject: Evaluation of the Traffic Impact Findings Consistency for the Reduced 401- 409 Alberto Way Office Project in Los Gatos, CA Dear Mr. Lamb, Hexagon Transportation Consultants, Inc, completed an evaluation of the reduced 401-409 Alberto Way office project's consistency with the traffic impact findings documented in the 401 to 409 Alberto Way Final Transportation Impact Analysis (TIA), dated Augus t 2, 2016 . The TIA analyzed a 93 ,500 s.f. office development project. The TIA concluded that the project would not generate any CEQA-related significant transportation impacts . Subsequent to the TIA, the project applicant is proposing a reduced project of 83,000 s.f. office, which is approximately a 11 % reduction from the project size analyzed in the TIA. Since the currently proposed project is smaller than the project analyzed in the TIA, the analysis conducted in the TIA is deemed conservative, and the reduced project's CEQA-related transportation impacts would be less than significant. The Environmental Impact Report (EIR) prepared for this project analyzed a Reduced Scale Alternative at approximately 74,260 s.f., which is a smaller project size than the cu rrently proposed 83,000 s.f. office. Therefore , the CEQA-related transportation impacts for the Reduced Scale Alternative analyzed in the EIR would also be less than significan t. If you have any questions please do not hesitate to c all . Sincerely, HEXAGON TRANSPORTATION CONSULTANTS, INC . Gary K. Black President 4 No rth Seco nd St reet , Suite 400 • San Jo se, Ca l iforn ia 95113 • p ho n e 4 0 8 .971 .6100 • fax 40 8.97 1.6 102 • w ww.h extrans.co m EXHIBITC Buchalter September 26, 2017 VIA E-MAIL (RSCHUL TZ@LOSGATOSCA.GOV) Mr. Rob Schultz, Town Attorney Town of Los Gatos 110 E. Main Street Los Gatos, CA 95031 Phone: (408) 354-6872 Email : rschultz@losgatosca.gov 55 Second Street Suite 1700 San Francisco, CA 94105 415.227.0900 Phone 415.227 .0770 Fax File Number: L4342-0002 415.227 .3508 Direct aguerra@buchalter.com Re: 401-409 Alberto Way, APN 529-23-018 Information Regarding Project Feasibility As you know, Buchalter represents LP Acquisitions, the developer of the project located at 401-409 Alberto Way in Los Gatos ("Alberto Way Project"). At its meeting of September 19, 2017, the Los Gatos Town Council closed the public hearing but invited the applicant and the public to submit written comments for the Council's consideration at its upcoming meeting of October 2, 2017 concerning the Alberto Way Project. I understand that questions arose concerning the information we previously provided the Town regarding the feasibility (or lack thereof) related to the Reduced Scale Alternative evaluated in the 401-409 Alberto Way Draft Environmental Impact Report -State Clearinghouse Number 2015122041 ("Alberto Way Draft EIR"). Please find attached for your review and consideration the following documents that we previously submitted to the Town that specifically address the cost considerations aspect of the feasibility of the Project alternatives: • Excerpts from the Buchalter May 9, 2017 Letter containing our supplemental responses to address the Provencher & Flatt, LLP ("Provencher & Flatt") Letter submitted on behalf of the Alberto Way Neighbors: Los Gatos Commons, Pueblo de Los Gatos, Las Casitas and Bella Vista Village ("Alberto Way Neighbors") for the upcoming Planning Commission meeting on May 10, 2017 for the 401-409 Alberto BN 31078372v2 buchalter.com Los Angeles Napa Valley Orange County Sacramento San Francisco Scottsdale Buchalter Mr. Rob Schultz, Town Attorney September 26 , 2017 Page2 Way Project (A tta chment l); • Excerpts from the LP Acquisitions' March 17 , 2017 Response Letter to the Planning Commission from the Public Hearing on August 24, 2016 (Atta chment 2 ); and • June 13, 2016 Letter from LP Acquisitions regarding the applican t's comments on the Alberto Way Draft EIR (Attachment 3). CEQA Definition of Feasibility The California Environmental Quality Act (Pub . Res. Code§§ 21000 et s eq.) ("CEQA") and CEQA Guidelines Section 15126.6(a) require that an EIR examine a range of alternatives that are potentially feasible to a proposed project (see e.g., City of Long Be ach v. Los Angeles Unified Sch . Dist. (2009) 176 Cal.App.41h 889, 920). An EIR is no t required to evaluate infeasible alternatives pursuant to CEQA Guidelines Section 1516.6(a). An EIR is also not required to consider alternatives that do not result in significant environmental advantages in comparison with the proposed Project. This is true particularly in those instances in which the alternatives would not reduce significant environmental impacts , such as in our case when the Project does not result in any significant unmitigated environmental impacts. As you know, Public Resources Code Section 21061. l and CEQA Guidelines Section 15364 define "feasible" as "capable of being accomplished in a successful manner within a reasonable period of time, taking into account economic, environmental , social , and technological factors " for purposes of complying with CEQA (also see, CEQA Guidelines Section 15126 .6(t)). Among the factors that may be considered when addressing the feasibility of on-site alternatives are site suitability, economic viability, availability of infrastructure, general plan consistency, other plans or regulatory limitations, and jurisdictional boundaries . No one of these facto rs establishes a fixed limit on the scope of reasonable alternatives under CEQA. 14 Cal. Code Regs. Section 15126 .6(f)(l); Citizens of Goleta Valley v. Board of Super visors, 52 Cal 3d 553 , 565 (1990). Economic infeasibility must be supported by evidence and analysis showing that it cannot reasonably be implemented, based on a reasonably prudent standard. Kings County Farm Bureau v. City of Hanford, 221 Cal. App. 3d 692 , 737 (1990). The Revised Project (83,000 sO LP Acquisitions reduced the size of its Original Project to respond to the Planning Commission's direction from August 2016 to further reduce the si ze of the Project as discussed in Attachment 2 . My client's revised 83 ,000 square foot Project which was presented to the Planning Commission and the Town Council is greater than the 74 ,260 square-foot Reduced Scale Alternative included in the Draft EIR, and it is less than the 92 ,800 square foot original project evaluated in the EIR. The Revised Project at 8 3,000 square fee t with the subsurface BN 31078372v2 Buchalter Mr. Rob Schultz, Town Attorney September 26, 201 7 Page3 parking garage is feasible for the reasons discussed in Attachment I. By contrast, the 74,260 square foot Reduced Scale Alternative is not feasible as explained in Attachment 2 and further discussed below. The EIR Reduced Project Alternative (74,260 sO We submitted a comment letter on behalf of LP Acquisitions regarding the Town's Draft EIR questioning the Draft EIR's analysis of the Reduced Project Alternative when that alternative failed to meet most of the basic project objectives (Attachment 3) required for the Project. LP Acquisitions' March 17, 2017 Letter included in the May 10, 2017 Staff Report further explained why the smaller 74,260 square foot office building surrounded by surface parking failed to meet CEQA's definition of feasibility due to cost considerations . The March 17, 2017 Letter contained in Attachment 2 focused specifically on the question of economic feasibility, and explained that when combined with the land price, the land acquisition cost and the parking structure cost resulted in a development cost of $615 per building square foot. Current contractor estimates as of September 2017 for construction costs are now above$ 700 per building square foot. For the 83,000 square foot Revised Project, the construction costs result in a total of approximately $58, 100,000 just for construction (R. Lamb, LP Acquisitions, September 25, 2017). By way of example, one sub-category of costs, the costs for the two story underground parking structure, are estimated at $ 15,000,000. This is because the parking garage is very technical to design, given drive aisle spacing and efficiencies in laying out the required parking spaces, and to be efficient, must allow the office building to sit directly above the garage using the same perimeter. Moreover, building square footage reductions do not equate to corresponding reductions in garage square footage and associated costs. This means that reducing the building size to 74,260 square feet under the Reduced Project Alternative would not result in a comparable reduction in the size of the parking garage. Due to the constraints identified in the preceding paragraph, the parking spaces would be taken out of the surface parking, not the parking garage. My client is further limited in its ability to reduce the garage given that at a 9,000 square foot reduction in office space, the resulting reduction in parking needed for the project would be equal to 36 stalls . The architect, however, is limited in his ability to design an efficient drive aisle and parking scenario, even with only dropping 36 stalls. Consequently, this would entail a redesign of the office building, which would change the footprint of the building, thereby further increasing costs. Accordingly, any reduction in building size results in a corresponding increase in the costs for the garage alone, on a per square foot basis. Another constraint represented in the information LP Acquisitions submitted in March 2017 is attributable to investor and lender interest given certain industry standards regarding return on cost to justify the investment. For example, with respect to the Alberto Way Project, BN 31078372v2 Buchalter Mr. Rob Schultz, Town Attorney September 26, 2017 Page 4 lenders expect that the project will realize a 12% return on costs . This return provides the lender with some assurances to mitigate potential risks and that the lender's funds are safely covered on the Project. For the 83 ,000 square foot Revised Project, the return on cost including the land costs would account for an amount significantly below the 12 % return on costs, and with the 74,260 square foot Reduced Scale Alternative, the return is even lower approximating closer to 10 % return. Please let me know if you have any questions concerning the information we have provided regard the infeasibility of the Reduced Scale Alternative. We appreciate your consideration of the enclosed information and look forward to the Town Council's continued deliberations regarding the Alberto Way Project next Tuesday. Attachments cc (via email): Randy Lamb Shane Arters Jolie Houston Dan Orloff Dan Kirby BN 3 10 783 72v2 By Sincerely, BUCHALTER A Professional Corporation Buchalter ~~\ ~~~sh /U:J\( VIA E-MAIL (JARMER@~~OO}~ F~~ May 9, 2017 Ms. Jennifer Armer Town of Los Gatos Community Development Department 110 E. Main Street Los Gatos, CA 95031 Phone: (408) 354-6872 Email: jarmer@losgatosca.gov 55 Second Street Suite 1700 San Francisco, CA 94105 415.227.0900 Phone 415.227.0770 Fax File Number: L4342-0002 415.227.3508 Direct aguerra@buchalter.com Re: Planning Commission Public Hearing of May 10, 2017 -Supplemental Responses 401-409 Alberto Way Architecture and Site Application S-15-056 Conditional Use Permit Application U-15-009 APN 529 -23-018 Buchalter represents LP Acquisitions, the developer of the project located at 401-409 Alberto Way in Los Gatos. I have reviewed the May 5, 2017 Town of Los Gatos Staff Report (the "May 5th Staff Report") regarding the Architecture and Site Application S-15-056, Conditional Use Permit Application U-15-009, and Environmental Impact Report EIR-16-001 for the 401-409 Alberto Way Project (the "Project") on behalf of my client. The May 5th Staff Report includes comment letters received after distribution of the staff report addendum for the · originally scheduled April 12, 2017, meeting (Exhibit 42 1 ). Most of the comments are the same comments that the commenters submitted in August 2016 and in March 2017. The purpose of this letter, however, is to respond to comments from the following commenters regarding the technical documents that the Project team submitted on April 24, 2017: • Provencher & Flatt, LLP ("Provencher & Flatt") on behalf of the Alberto Way Neighbors: Los Gatos Commons, Pueblo de Los Gatos, Las Casitas and Bella Vista Village ("Alberto Way Neighbors") for the upcoming Planning Commission meeting 1 Page I of 3 in the May 5th StafT Report indicates that the new comment letters are found in Exhibit 44, but the Table of Contents on page 3 of3 indicates that the new comment letters are included in Exhibit 42. It appears that the comment letters are found in Exhibit 42. BN 28641495v2 buchalter.com Los Angeles Napa Valley Orange County Sacramento San Francisco Scottsdale Buchalter Ms. Jennifer Armer May 9, 2017 Page 5 Thus, all of the traffic comments that the cornmenters continue to raise were already addressed in the EIR, the technical analyses and the prior responses to comments, including our April 24th Supplemental Responses, and there are no new significant impacts triggering the need for further analysis or a change in the project to address the Project's traffic impacts. New Residential Alternative One commenter has suggested that my client has not evaluated a reasonable range of alternatives that would significantly reduce or avoid the Project's impacts or explained why the other alternatives were rejected in light of the "unacknowledged" impacts raised by the commenter, implying that the smaller office building surrounded by surface parking in lieu of a subsurface parking garage should be evaluated as an alternative to the Project. Another commenter suggested that a residential alternative for an active adult community be evaluated. Regarding the EIR's analysis of alternatives, the EIR evaluated three alternatives to the Proposed Project. An alternative site location alternative was considered but rejected because the reason for the Project is to redevelop the Project site, and no other suitable sites were available in the vicinity of the Project site that could accomplish that same basic project purpose as explained in Section 6.3 of the Draft EIR. The applicant's further revisio ns to the Project reflected in the revised Project were designed to reduce the size of the Project to 83,000 square feet to respond to the Planning Commission's direction from August 2016. The revised Project at 83,000 square feet is greater than the 74,260 square foot Reduced Scale Alternative included in the Draft EIR and less than the 92,800 square foot project evaluated in the EIR. Public Resources Code Section 21061. l defines "feasible" as "capable of being accomplished in a successful manner within a reasonable period of time, taking into account economic, environmental, social and technological factors." Among the factors that may be taken into account when addressing the feasibility of on-site alternatives are site suitability, economic viability, availability of infrastructure, general plan consistency, other plans or regulatory limitations, and jurisdictional boundaries. No one of these factors establishes a fi xed limit on the scope of reasonable alternatives under CEQA. 14 Cal. Code Regs. Section 15126.6(f)(l); Citizens of Goleta Valley v. Board of Supervisors, 52 Cal 3d 553, 565 (1990). Economic infeasibility must be supported by evidence and analysis showing that it cannot reasonably be implemented, based on a reasonably prudent standard. Kings Coun ty Farm Bureau v. City of Hanford, 221 Cal. App. 3d 692, 737 ( 1990). The revised Project at 83,000 square feet with the subsurface parking garage is feasible, as explained in my client's April 24th Supplemental Responses. As LP Acquisitions indicated on numerous occasions, one of the key project objectives is to build a Class A office building in the Los Gatos market. Specific factors that are critical to the development of a Class A office building to accommodate this market sector include: BN 2864 l 495v2 Buchalter Ms. Jennifer Armer May9, 2017 Page 6 • Class A tech company users require large footprints of35,000 square feet per floor and above as demonstrated by the recent approval of the Netflix campus. • Recruiting, hiring and retention of employees is extremely competitive in Silicon Valley and large facilities with many amenities are the future of high tech employment opportunities for the foreseeable future. • Class A tech users need a minimum building(s) size for the amenities they offer their employees to provide the services and fully absorb the costs (i.e., fitness rooms, bike storage, cafeteria, outside common spaces and large conference facilities). • Employee health and wellbeing requires access to natural light as a priority and is facilitated by large glass lines and skylight areas where possible. • Secured parking is a Class A space advantage for a company by locating tenant parking underground. Regarding a smaller office building surrounded by surface parking, by contrast, the building developer would be unable to provide secured parking for its tenants, or accommodate the types of building amenities and features that are included in a Class A office building in response to market demands. Regarding a senior residential community alternative, my client met with Town advisory officials early in the process to discuss a residential project for the site, and was advised that residential uses would not be permitted on the property for the following reasons : • residential use is not a permitted or conditionally permitted use in this zoning district, and thus would require a general plan amendment and rezoning in order to change the land use on the site; • a residential project would impact schools by adding more kids to the Town that would lead to further crowding in the schools and result in the need to add more classrooms and teachers . (Admittedly, an active adult community would not have the same impact on schools). Additionally, given the site's proximity to Highway 9 and Highway 17, a residential community on the property would be exposed to elevated noise and air quality impacts due to exposure to vehicular-generated noise and air pollutant emissions. Senior citizens are considered sensitive receptors and may be exposed to potential respiratory issues due to the proximity to the freeway. Also, if the commenters are concerned about the potential exposure to inundation due to dam failure at Lenihan Dam then that concern would be exacerbated by locating more residents in the area as compared to the proposed Project which would result in exposure of an office building that is not occupied on a full-time basis. Moreover, residential uses would generate approximately 9 to l 0 daily trips per unit depending on the type of dwelling unit, thereby BN 2864 1495v2 M•rchn,2011 ~~~ ~~S Ms.Jennlfe<Armer,Assoclat~~ ~ TownoflosGatos ~ Community Development Department 110 E. Main Street Los Gatos, CA 95031 Phone: (408) 354-6872 Email : jarmer@losgatosca.gov RE : Response Letter to Planning Commission from Public Hearing on August 24 , 2016. 405 Alberto Way Architecture and Site Application S-15-056 Conditional Use Permit Appllcatlon U-15-009 APN 529-2 3-018 Thank you for recommending approval of LP Acquisition's above-referenced project to the Planning Commission at its hearing on August 24, 2016 . In anticipation of the continued Planning Commission Publlc Hearing scheduled for March 22od, this response letter describes the architectural changes between the Original Plan Set (a/k/a 401-405 Alberto Way) submitted on July 13, 2016 and the Revised Plan Set (a/k/a 405 Alberto Way) submitted on March 9, 2017, and responds to the Planning Commissioner's direction from the August 24, 2016 Public Hearing. SUMMARY OF ARCHITECTURAL CHANGES: Since the August 24, 2016 Planning Commission meeting, LP Acquisitions has been meeting with the neighbors and Interested parties, and we initiated a comprehensive effort to redesign our Project In response to both the Town and neighborhood comments and concerns. Based on the feedback we received from the Planning Commission and the neighborhood, we revised the architecture to Incorporate the following key design modifications: We combined the former two (2), two-story buildings into a single, two-story building thereby resulting in a 9,000 square foot reduction In floor area, and a reduction in overall heights by 5 .5 feet on the north side and 6.0 feet on the south side of the new building when compared to the previous two buildings. Other changes include: • To illustrate the reduction in the building massing and size, the original design was 1,614,290 cubic feet ("cf") and the proposed redesign Is 1,207,665 cf. Therefore, we reduced the buHding size by 25%. 53 5 Middlefield Road, Suite 190, Menlo Park, CA 94025 I 650.326.1600 EXHIBIT 3 1 APPLICANT RESPONSE LETTER • We relocated the office building to the rear of the site, against the setback lines on Saratoga-Los Gatos Rd. (Route 9) and the on-ramp to Highway 17. This accomplishes two very important goals: 1) allows for significantly more open space on the Alberto Way frontage to the building, which Is utilized for additional surface parking and amenity sp~ce, and 2) enhance the views of the existing trees and mountains behind the building, when viewed from the properties on the other side of Alberto Way. • We shifted the building by an additional 10 feet away from the north property line, In response to concerns from the Las Casitas neighbors which borders the Applicant's property to the north. The reduced building size, along with a reduced parking ratio of 4 spaces per 1,000 square feet of building area, results in a 58 -space reduction in the overall parking count from 390 parking spaces to 332 parking spaces. In response to the Town and neighborhood concerns regarding the former design's lack of surface parking, we Increased the surface parking count from 7 to 42 parking spaces. The overall parking reduction also results in a significant reduction In size of the underground parking garage (which we retained) thereby accommodating all construction staging on site, instead of In the street. We replaced the proposed building foundation with a concrete superstructure in order to significantly reduce the building height by 5.5 feet on the north side and 6.0 feet on the south ·side . Consequently, the revised building footprint preserves the views of the existing trees and mountains behind the building, when viewed from the properties on the other side of Alberto Way. We also eliminated the tower elements in response to the Planning Commission and neighbors' concerns that the elements were too prominent, and we eliminated the second-floor exterior balcony on the north (Las Casitas) side of the building. All second-floor exterior balconies now face Alberto Way thereby enhancing the des ign hierarchy of the building to create m·ore definition between the ground and second floor design elements. LP Acquisitions retained the Mission style architecture which maintains the small-town flavor of other, nearby commercial developments in Los Gatos and resembles the mass ing and scale of the other existing buildings in the Immediate neighborhood. Lastly, and in response to both the Town and neighbor concerns with respect to traffic and safety on Alberto Way, and consistent with the Town's Complete Street Ordinance, we are proposing to dedicate a portion of the site for the purpose of widening and straightening Alberto Way, allowing for the addition of both a bike lane in front of the property and an extended right turn lane onto Saratoga-Los Gatos Road (Route 9). We have identified locations for detached sidewalk Improvements on both the Alberto Way and Saratoga-Los Gatos Road (Route 9) street frontages, and are proposing to install new curb, ramps and crosswalk at the Saratoga-Los Gatos Road (Route 9) to the Highway 17 on ramp. We have addressed the Town's and neighbors' concerns regarding the project through the design modifications summarized above and further discussed in ARC TEC's letter dated March 2 APPLICANT RESPONSE LEITER 16, 2017. The proposed modifications described above are feasible and represent minor revisions and clarifications to the overatf project description that will not add significant new Information to the Town of Los Gatos 401-409 Alberto Way Draft and Final Environmental Impact Report (EIR). This Information will not require recirculation of the EIR because the proposed modifications will further lessen impacts that the Town previously found to be less than-significant. Further the changes incorporated Into the Project would not involve a new significant environmental Impact, a substantial increase In the severity of a prior environmental impact, or a feasible mitigation measure or alternative that we declined to adopt and that will clearly lessen any project Impacts. No Information provided In our submittal Indicates that the Draft EIR was inadequate or conclusory or that the public was deprived of a meaningful opportunity to review and comment on the EIR. SUMMARY OF PLANNING COMMISSIONER DIRECTIONS TO THE APPLICANT FROM THE AUGUST 24, 2016 PUBLIC HEARING: The following summarizes key comments from the Planning Commission followed by our response to the comment referred to as, the "Appllcant Response." Thomas O'Donnell (Chair) 1 . Requested a 1/3 reduction in the size of the building. APPLICANT RESPONSE : The Applicant's proposed redesign of the office project reduces the size and mass of the building by combining the two former buildings into a si ngle building (a/k/a 405 Alberto Way). The smaller single building redesign provides less floor area and would result in further setting back the building to the rear setback allowed by the Town. Also, we reduced the building's overall heights by 5.5 feet on the north side and 6 .0 feet on the south side, and we eliminated the tower elements. Consequently, the overall size of the building expressed in cubic feet has resulted in a 25% reduction. Additionally, the following facts support our redesigned office project: 1) the current Class A office vacancy rate in Los Gatos is at or near 0% (see attached exhibit "Colliers Los Gatos Office Class A Snapshot"); therefore, there is an enormous demand for more Class A office in Los Gatos; 2) Due to the high price of land and construction costs, it Is not financially feasible for LP Acquisitions to develop an office project of less than 83,000 square feet on this site . For example, the parking structure costs alone exceed $12 million dollars. When coupled with the land price, the land acquisition cost and the parking structure together result In a development cost. of $615 per square foot. This cost does not Include other development costs associated with grading and excavation, and on-site and off-site Infrastructure. Lenders typically expect a 12% annual lease payment on total costs for the lender's own risk calculations in order to decide whetheJ to invest In a ·commercial office project. With a 12% annual lease payment, the rent would need to be $6.15 triple net lease (NNN). In the Los Gatos office market, rents are closer to $4.50 NNN which would result in a return below 9%. With a return below 9% and the development costs associated 3 APPLICANT RESPONSE LITTER with this project for an 83,000 square foot building the revised Project is barely at the threshold of feasibility . Any further reductions in project size compromise the likelihood that LP Acquisitions will be able to secure a lender for this project. Accordingly, LP Acquisitions found that the 83,000 square foot building is the smallest sized building that feasibly could be developed and still meet the basic project objectives, while incorporating the design changes requested by the Planning Commission and the public. 0 . Michael Kane (Vice Chair) 1. The new office project should be similar (in architectural style) with surrounding neighborhood per Community Design Element ("CD"), Section 1.4 APPLICANT RESPONSE: As there Is no prevalent commercial architectural style In the immediate surrounding neighborhood as discussed at the August 24th Planning Commission meeting, we redesigned the proposed projed to promote the small -town atmosphere "feel and image", and so that the building complements the existing commercial centers consistent with the maintenance and design of a small-town Class A office center. Specifically, the project vernacular Is of a mission-style architecture and the building incorporates various design elements of the Hotel Los Gatos and Palo Alto Medical Foundation building located on Los Gatos Boulevard . The Town 's Archltectural Consultant approved the p roposed architectural style as in keeping with the Town's Commercial Design Guldellnes. 2. Develop traffic safety measures: a. For vehicles turning from Alberto Way onto Saratoga -Los Gatos Road (Route 9) westbound -cars are driving too fast down the hill under existing conditions . APPLICANT RESPONSE: LP Acquisitions is proposing to incorporate the Town's Complete Street Program Into the Project circulation system . For example, the Project Includes detached sidewalk along Saratoga-Los Gatos Road (Route 9) ln order to create a buffer between pedestrians and vehicles exiting onto the Hwy 17 onramp. The sidewalk will lead to an ADA compliant ramp that will allow pedestrians to cross the Hwy 17 onramp with the use of a striped crosswalk as shown on Sheets Al.01 and C2.0 of the March 9, 2017 Revised Plan Set submittal package . To address the existing conditions, the Town could consider installing a speed feedback sign on the hill. b. Look into installing traffic calming measures on Alberto Way. APPLCIANT RESPONSE: After the August 24, 2016 Planning Commission Hearing, the LP Acquisitions project team met with Publlc Works and Planning on September 2, 2016 to explore various options for traffic calming measures on Alberto Way and Saratoga-Los Gatos Road (Route 9). Per the Town's Public Works Department, LP Acquisitions would need to comply with the Town's Traffic Calming Policy . Traffic calming is 4 1 2 Junell,2016 ~ -IZ..-- JenniferArmer,AICP,AssodatePlanner /°"'t:>, r__i ~~ Town of Los Gatos ~Wl \ ~ VJ CJ ''--- 110 East Main Street Los Gatos, CA 95030 Re: 401-409 Alberto Way Draft EIR -State Clearinghouse Number 2015122041 Dear Ms. Anner: Thank you for the opportunity to submit comments on the above-referenced 401-409 Alberto Way Project Draft Environmental Impact Report ("Draft EIR"). We appreciate the Town's thorough review of LP Acquisitions' proposed office development and submit the following comments regarding the Draft EIR's analysis of the above-referenced project for the Town of Los Gatos ' ("Town") consideration. Background Our property consists of an approximately 2.1 5-acre parcel located in the northwest comer of Los Gatos Saratoga Road and Alberto Way (the "Site"). The Site is bordered by a wooded strip of land and an on-ramp to northbound State Route 17 to the west, a multi-family residential development to the north, and multi-family housing, commercial space, a hotel and restaurant are located to the east across Alberto Way . As the Draft EIR explains, we are propo sing to demolish the existing 31,000 square foot office buildings and replace them with two new two-story office buildings, totaling 91,965 square feet, over a two-level, below-grade parking garage (the "Proposed Project"). The Proposed Project is designed to provide the type of high-quality, Class A office space that will attract businesses seeking "A" space to stay in Los Gatos or relocate to Los Gatos (see Revised February JO, 2016 Letter of JustificaLion attached to this lette r as Attachment A). General Comments We have designed our Project so that the proposed d evelopment is sensitive to the surrounding neighborhood and addresses each and every p o tentia l impact up front as part of the Project. Consistent with this goal, the Draft EIR concludes that the Proposed Project would not result in any significant envirolll!lental impacts. We noted that the Draft EJR included a rev iew of alternatives to the Proposed Project, perhaps because E IRs often describe a range of reaso nable alternatives to a Proposed Project. According to Chapter 6 in the Draft EIR, the alternatives considered in the analysis must (1) "feasibly attain" most of the basic objectives, and (2) avoid or substantially lessen any of the 525 Middlefield Road, Suite 118, Menlo Park, CA 94025 I 650.326 .1600 BN 20874357v3 2 3 4 Jennifer Armer June 13, 2016 Page 2 significant effects of the proposed project. It is our understanding that the purpose of an EIR alternatives analysis is to determine whether there is a feasi ble way (other than the Proposed Project) to achieve the basic objectives of a project while avoiding or lessening significant impacts . In light of our understanding of the purpose of an EIR alternatives analysis, we have two concerns about t he Draft EIR 's analysis of alternatives which we would like to highlight fo r your consideration. First, we thought that an ElR was meant to identify alternatives that avo id or substantially lessen significant environmental impacts of the Project. As the Draft EIR concludes, there are n o significant effects of the Proposed Project. Since there are no significant impacts, we are unclear as to why an alternatives analysis was even included in the Draft EIR. Since the Town prepared an alternatives analysis in any event, it would be helpful if the EIR were revised to clari fy that the alternatives analysis contained in Chapter 6 was provided for informational purposes only, because the Proposed Project did not result in any significant impacts warranting identification of an alternative which wou ld substantially lessen the Project impacts. For example, the EIR could include an introductory paragraph on page 6-2 stating that the alternatives analysis is being provided for informational purposes only and/or to aid in understanding how effects that are already identified as less than significant could be minimized further. Secondly, regarding the Draft EIR's identification of alternatives, we note that the EIR includ ed alternatives which would not achieve the bas ic project objectives. Although the Draft EIR notes this is the case as to both No Project Alternatives, the Draft EIR did not provide any explanation as to whether the Reduced Project Alternative achieved the Proposed Project 's objectives. On page 6-7 , the description of the Reduced Project Alternative does not discuss how the reduced total commercial square footage number was derived and on what basis the evaluation has been made. For example, on page 6-9, the Draft EIR lists all 11 of the Project objectives and concludes on page 6-10 that the Reduced Project Alternative is consistent with all of them. Then the EIR indicates that the Reduced Project Alternative conceptually meets most, if not all of th e project objectives, and "it is conceivable that this alternative could be considered feasibly compatible with proposed site plans and design for the proposed project," even with a reduction in square footage. The Draft EIR does not explain how the Town reached this conclusion. In fact, for the first five Proj ect obj ectives and the tenth objective, the Reduced Project Alternative would only partially meet the specified project objective. While the site would be redeveloped with a smaller project, the cost of all of the high-quality architecture and design features would be spread over a smaller amount of square footage thereby ·making these improvements costlier than the Project would experience with its greater square footage. Regarding the s ixth through eighth objectives, while the Proposed Project will be able to fund the installation of pedestrian oriented space, groves of trees and enhanced bicycle and pedestrian connectivity, such features will be limited on the property under the Reduced Project Alternative . Addition~lly, the redevelopment of the property may not full y reali ze a net positive fiscal impac t 525 Middl efield Road , Suire 1 18, Menlo Park, CA 94025 I 650.326.1600