Item 2 - N40 Phase 1 - Addendum & Exhibits 32-33TOWN OF LOS GATOS ITEMN0:2
ADDENDUM PLANNING COMMISSION STAFF REPORT
Meeting Date: July 12, 2016
PREPARED BY:
APPLICATION NO:
LOCATION:
APPLICANT:
CONTACT PERSONS:
PROPERTY OWNERS:
Sally Zarnowitz, Planning Manager
szamowitz@losgatosc&.gov
Architecture and Site Application S-13-090
Vesting Tentative Map Application M-13-014
North 40 Specific Plan Phase 1 (southerly portion of the North
40 Specific Plan area, Lark Avenue to south ofNoddin Avenue)
Grosvenor USA Limited
Don Capobres (Harmonie Park Development Co.) and Wendi
Baker {Summerhill Homes)
Yuki Farms, ETPH LP, Grosvenor USA Limited, Summerhill
N40 LLC, Elizabeth K. Dodson, and William Hirschman
APPLICATION SUMMARY: Requesting approval for the constrUction of a new multi-use,
multi-story development consisting of 320 residential units,
which includes 50 affordable senior units; approximately 66,800
square feet of commercial floor area, which includes a market
hall; on-site and off-site improvements; and a vesting tentative
map. APNs: 424-07-024 through 027,031 through 037,070,
083 through 086, 090, and 100.
RECOMMENDATION:
PROJECT DATA:
Forward a recommendation of approval to the Town Council,
subject to recommended conditions.
General Plan Designation: North 40 Specific Plan
Zoning Designation: North 40 Specific Plan
Applicable Plans & Standards: General Plan;
North 40 Specific Plan
Project Area: 20.7 acres
Planning Commission StaffReport-Page 2
North 40 Phase 1/S-13-090/M-13-014
July 12, 2016
CEQA:
FINDINGS:
CONSIDERATIONS:
Surrounding Area:
Existing Land General Plan Zoning
Use
North Agriculture, North 40 Specific Plan N40SP
Commercial, (N40 SP)
and Residential
East Commercial Mixed Use Commercial CH,
and Residential R-1:8
South Commercial, Mixed Use Commercial, CH,
Office and Low and Medium R-1:8,
Residential Density Residential RD
West Highway 17 N/A N/A
An Envirorunental hnpact Report (EIR) was prepared and
certified for the North 40 Specific Plan on January 5, 2015. An
Initial Study has been prepared and concludes that the proposed
Phase 1 development applications do not require additional
envirorunental clearance beyond the certified EIR.
• That an Initial Study has been prepared and concludes that
the project does not require additional environmental
clearance beyond the certified EIR.
• That the project is consistent with the General Plan.
• That the project is consistent with the North 40 Specific Plan.
• As required by Section 29.10.09030(e) of the Town Code for
demolitions.
• As required by Table 2-6 of the North 40 Specific Plan for
reduction of non-residential setbacks.
• As required by Section 29.10.420 (a) of the Town Code ifthe
Planning Commission denies the Density Bonus request.
• As required by Goverrunent Code Section 65589.5 if the
Planning Commission denies the Development Standard
wruvers.
• As required by Section 66474 of the Subdivision Map for the
Vesting Tentative Map application.
• As required by Section 29.20.150 of the Town Code for
granting approval of an Architecture and Site application.
Planning Commission Staff Report -Page 3
North 40 Phase 1/S-13-090/M-13-014
July 12t 2016
ACTION:
EXHIBITS:
Open the public hearing, take testimonyt and forward a
recommendation to the Town Council, subject to the
recommended conditions.
Previously received under separate cover:
1. Proposed Development Plans, received March 18, 2016 (242
pages)
Previously received with the March 30, 2016 Staff Report:
2. Location Map (one page)
3. Initial Study (79 pages)
4. Findings and Considerations (three pages)
5. Conditions of Approval for Vesting Tentative Map (six
pages)
6. Conditions of Approval for the Architecture and Site
Application (27 pages)
7. Letter of Justification received March 23t 2016 (10 pages)
8. North 40 Narrative received February 8, 2016 (seven pages)
9. Economic study letter received November 6, 2015 (25 pages)
10. October 14 and November 11,2015 CDAC Minutes (seven
pages)
11. Response to CDAC comments received February 8t 2016 (13
pages)
12. January 27,2016 Historic Preservation Committee Minutes
(five pages)
13. Consulting Architect Report received December 18, 2015
(six pages)
14. Response to Consulting Architect Report received February
8, 2016 (three pages),
15. Consulting Architect Report received March 21, 2016 (six
pages)
16. Consulting Arborist Report received October 14, 2013 (33
pages)
17. State Density Bonus Law-Government Code Section 65915-
65918 (14 pages)
18. Density Bonus Ordinance and Program Guidelines -
Ordinance 2209 (21 pages)
19. Letter from Barbara Kautz, received March 10, 2016 (16
pages)
20. Town's BMP Program and Guidelines-Ordinance 2181 (19
pages)
21. Public comment received through 11 :00 a.m., Thursday,
March 24,2016
Planning Commission StaffReport-Page 4
North 40 Phase 1/S-13-090/M-13-014
July 12, 2016
REMARKS:
Previously received with March 30, 2016 Addendum Reoort:
22. Updated letter from Barbara Kautz received March 25, 2016
(five pages)
23. Comments received from 11:01 a.m. on March 24, 2016 to
11:00 a.m. on March 28, 2016
Previously received with March 30, 2016 Desk Item Report:
24. Residential Density Exhibit (one page), received March 30,
2016
25. Comments received from 11:01 a.m. on March 28, 2016 to
11:00 a.m. on March 30,2016
Received with July 12, 2016 StaffReoort:
26. Frequently Asked Questions (F AQ) prepared for North 40
Study Session (14 pages)
27. Verbatim minutes of the March 30, 2016 Planning
Commission meeting (164 pages)
28. Verbatim minutes ofthe June 15,2016 Study Session (143
pages)
29. Memo from Town Attorney regarding application deadlines
(eight pages)
30. Items received at March 30, 2016 Planning Commission
(four pages)
31. Comments received from 11:01 a.m. on March 30, 2016 to
11:00 a.m. on July 6, 2016
Received with this Addendum Report:
32. Comments received from 11:01 a.m. on July 6, 2016 to 11:00
a.m. on July 8, 2016
33. Additional information from the applicant and the applicant's
attorneys
The attached public comments on the proposed application (Exhibit 32) were received after
distribution of the staff report.
Additionally, the applicant and the applicant's attorneys submitted additional information
(Exhibit 33).
Planning Commission Staff Report-Page 5
~orth 40 Phase 1/S-13-090/M-13-014
July 12, 2016
~ -I . . ~
JP:SZ:cg
roved by:·
oel Paulson, AICP
Community Development Director
cc: Grosvenor Americas, Steve Buster, 1 California St., Ste. 2500, San Francisco, CA 94111
Harmonie Park Development Co., Don Capobres, 221 Bachman Ave., Los Gatos, CA 95030
Summerhill Homes, Wendi Baker, 3000 Executive Prkwy., Ste. 450, San Ramon, CA 94583
N :\DE V\P C REPORTS \20 16\North 40 7-12-16-ADD.docx
This Page
Intentionally
Left Blank
From: Rita Matthews [mailto:fourwinn156@hotmail.com]
sent: Thursday, June 30, 2016 12:16 AM
To: North40 Comment; Steven Leonardis; Rob Rennie; BSpector; Marcia Jensen;
maricosayoc@yahoo.com
Subject: LG development proposals
Dear Council and Planning Commission of Los Gatos;
I strongly urge you to vote AGAINST the North 40 development AND the proposed new
construction on Bella Vista Avenue.
I speak as a homeowner in the Bella Vista neighborhood and a Los Gatos resident for 35 years.
My arguments against these two construction proposals are basically the same:
They violate the vision generally agreed upon for the town as stated in the 2020 General
Plan:
• Foster a pedestrian-oriented community with a smaU-town character;
North 40 development and new co n struction in LG neighborhoods such as Bella Vista Avenue bring increased
congestion, traffic and population d en sity that is counter to the "small town character" desired by LG residents and
itemized in the General Plan. As an example of my concerns, my husband and I h ave spoken numerous times to LG
police regarding neighborhood pedes tri an and traffic safety. The increa sing number s and speed of auto mobiles
ra cing down Caldwell Avenue from Los Gatos Blvd., as a shortcut to downtown, is a signi ficant problem . Town streets
are typically narrow street s with limited on -street parking. The proposed mega-h ou se construction o n Bella
Vista exace rbates these traffic issues. A fi ve bedroom home with no driveway forces multiple automobiles to the street.
The N orth 40 proposal also severely distorts the "sm all town", "pedestrian-oriented" environment the majority of you
supported in your election platforms. My stomach turns as I drive down highway 17 and view the looming, orange
"story poles". Ther e is nothing in that plan that promotes the "small-town" character we strive to achieve. Parking lo t s,
crowds, hundreds of automobiles, tra ffic jam s, and the los s of precious open space is the end result.
• Support an active business community that provides a wide variety of goods and services and a broad
range of employment opportunities, minimizing the need to travel to other communities;
The Proposed N orth 40 d evelopment will draw customers away from downtown businesses. This Santana Row-type
complex will compete with downtow n business, compounding the current competition from Campbell and Santana
Row/Vall ey Fair. I know how difficult it is for a busin ess to survi ve in LG with the cost of rental space skyrocketing. As
the treasurer o f the EMQ Auxiliary that runs The Butter Paddle downtown, I see the di sparity between revenue and
expenses. As a non-profit staffed by volunteers, The Butter Paddle doe sn't have the burden o f per so nnel expenses as
other stores/businesses do. No o ne wants L G to go the way of downtown Saratoga, a veritable "ghost tow n" of fail ed
business opportunities.
• Maintain a balanced, weD-designed mix of residential, commercial, service and open space uses
through integrated land use planning;
• Be a fuU-service community that is also environmentally sensitive;
The argument for "open space" and environmental sen sitivity cannot be overlooked. I am not naive enough to beli eve
that comm ercial and re sidential development should cease in Los Gatos. However, as the Town Council and Planning
Commission, yo u have the responsibility to maintain a careful balance that protec ts the natural and man-made
environment and pro motes the h ealth and well being of the population. Commercial development lik e N orth 40
signifi candy impacts th e quality of life in Los Gatos. I'm struck by the current environmental issue s ca used by limited
highway access, traffic jam s, pollution and population density in the area today. These issues are compounded b y the
dangerous proximity of the pro p osed development to Good Samaritan H ospital and
the n umerous medical services located n earby. I know yo u see this, as I do, in your d aily liv es. D rive
Highway 17 after 3 P M on a week day; try to get to a d octor ap p ointment withou t d elays on Los Gatos
Blvd; traver se d owntown LG to pick up your child at St. Mary's, LG High Sch ool, Van Meter o r Blossom Hill
E lementary . This is life in Los G atos today; let's be smart about expansion; let's re focus on o ur vision for the town.
I hope that you will con si der my concern s as you deliberate the future of our town. Than k you
for your time and attention to these matters .
Rita Matthews
208 Caldwell Ave
Los Gatos, CA
From: Jeanette Blacy [mailto:jeanette@blacys.com]
Sent: Saturday, July 02, 2016 1:20PM
To: North40 Comment
Cc: Steven Leonardis; Rob Rennie; BSpector; Marcia Jensen; Marico Sayoc
Subject: North 40 retail developement Risk V.S. Opportunity
Dear Planning commission,
I am writing you today to express my concerns over the retail plans for the north 40.
The Single Family housing and entertainment is needed but the planned retail is not.
Quality not quantity is a necessary mindset for this to be successful.
This could be put to better use in another way.
With our Cost of Living here in Los Gatos there is less discretionary spending.
I am not sure that you have been following the concerns over shopping per sq ft in the
us.
Please see the attached Featured Insight by NREI.
We currently sit at fe e t of r etail r e al estate a nd 84 billion squa re f eet of total
c ommercial real estate in the
US. 56 square feet of retail s pace per person and 26 Sq ft per person of retail
shopping space which is double of the second highest in the world which is in Canada
at 11 Sq ft PP. With internet shopping on the rise retail traditional brick and mortar
retail is fragile.
There will be an acceleration of mall closures in the next 10 years approximately 15%
will close.
The NOI I SPSF on most of shopping centers are really struggling in all B , C and D
retail across the nation.
We all want to see Los Gatos Flourish and be revitalized in the near future.
This is a terrible plan with that in mind. Retail is soft in demand mergers and
bankruptcies are on the increase.
We don't need the Outlets, Walmart's, Lowes and big anchors here in Los Gatos.
With this significant loss on the horizon how will this be fmanced ?
This will be a toe stub for Los Gatos the developer and an obvious economic risk.
I understand that the revenue possibility is very desirable and enticing but it is not
economically feasible.
$1 ,000
ssoo $965 -
$600
$400
S2.00
$0 n n F1 !$34 51 ~ 1~401 1$1851 IS130t
A++ A+ A A-8+ B 9-C+ c C -0
Sincerely,
Jeanette Blacy G. G.
51 University Ave
Los Gatos CA 95030
408 354 9500 phone
408 354 00 11 fax
408 221-1671 cell
http://www.blacys .com
.. ,.
Green Street Advisors
CO NTAC T
Kellin Johnson
Re t ail Real Es t ate Ou t loo k
Vice President, SubscriptiOn Sales
kjohnson@greenstreeladvisors.com
949-640-8780
Retail Real Estate Demand Drivers : Em p loy ment
Base li ne assump ti on is that j ob growth con ti nues at a steady pace but slowi ng as
w e nea r full em ployment
• W ag e g row th ha s bee n weak. bu t sh ou ld pick up T--Employment
·~o ········-· ......... --··· ·········--············-·------····---·····················--·····-·····-· & >O
Total ElrCJIOyment (M: teft axis) •.tob Growth (OOO's pe1 rnD<III\; rt a>is)
r,o --n --·-----·-•1"'1(1
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60
4V
'80
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Retail Real Estate Demand Drivers : Wealth Effects
Wealth effects have become a key d ifferentiator of incremental demand
Wealthy households have been faring well for a l ong time, and recent i nvestment
gains have been eno ugh to neutralize th e negative i mpact from tax increases
• High er home prices will ul timate ly fuel demand for lo we r-end cen ters -where
customers more sensitive to housing wealth tend to shop
The Ric~ Are Getting Richer
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The Middle Class Has Joined the Recovery Consume r Assets
-:510
•Homes(Netot~n;ogeDebt)
'15 'C5 w '00 '11 '13 '15 Totii:$P9T
____________ ft _____________ ··-----------------------------------------·---~-
3 WWW.GREENSTRE£T A.OVISORS.COM
Retail Real Estate Demand Drivers : Income Growth
The secular trend of the weal thy capturing a disproportionate share of income will
likely co ntinu e i n an increasingly knowledge-ba sed economy
• High-quality mall s and strip centers in affluent markets are i n a un ique p osi ti on to
serve th is group
The strugglin g middle cl a ss likely spending more of its stretched i ncome o n
necessities
Share of Totai.After-Tax U.S. Income
--TqJ 100.-Bima's
__ ..,..,.,..,.,......,..
=~!~~ -------1 . -,~ ==i~-i ~
20% -·
'110 '83 '86 '88 '91 '94 '97 '00 '02 '05 '06 '11
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"1"' "" ... a
... wllh the incn!aslngty
prooperingtop10%
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Retail Real Estate De mand Drivers : Income Growth
~
• Higher-income earners drive the lion's share of appa rel and entertainment spending
T hese d iscretionary categones make up a smaller percentag e of income for the
wealthy relative to lower-income households .
Consumer Expenditure Survey-By Income Bracket
•Share of Spend on Apprarel & ~ntertaJrment ·~ & Entertainrrent as a % of Income
30'11
25% -· · · •·•· ··-· · ·-·--· · ·-··-•· ·-· · · -·· ···-· ·-· ··• -· ·1-nlgiHnoone-nor.,.:n...e ---·
20%
15%
10%
5%
0%
Leos
than
$70.000
$70.000
to
$79,999
$80,000
to
$99,999
$100,000
to
$119,999
$120,000
to
$1<9.999
$150,000
and
more
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Reta il Rea l Estate Demand Drivers : Co nsumer S pending
G
A slow g ro wing economy means a sl ov1 pace of growth i n consumer spending
• However, spending is poised to accelerate in the next few yea rs-likely due to the
recent "tax break" at the gas pumps
Consumers are rotating d iscretiona ry dollars in to durable goods (e.g ., long-l iv ed
products such as appliances and autos) from nondurab le good consump tion (e.g .
products sold in t he mall such as apparel)
Real Consumer Spending (PCE) Growth
and Nondurable Goods Market Share (as a % of Durable +Nondurable) ... ,.,.
•Re .. PCE O'OIIOOI
...
7"' 50-ye ar avo: :1.3%
"' id
'------~--·L ______ ·--------~·• ""''"'~"' Mo~ot Stwo ,, .. ••>
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Mall 101 : Assessing Mall Quality
7
• Sa les per square foot is one me asure that efficiently wraps together all relevant
facto rs and p rovides the most consistent indicator of mall operating performa nce
Anct1or Qu;"tl1ly
lnllne Tenant Ourthty
N~<'t hy M.111
CompoltiiOn
··••··• .... :·
... -····· Mall Oualily
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Condtttons
Green Street E&t. Sales Productivity by Mall Quality Grade
(Sa les/s.f.)
·j~ nrmfiftFtf·'l_A~R_~ so
A .. A • A ,.. B• 8-C • c c-0
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Mall 101: Assessing Mall Quality
• Green Street grades malls on scale from 'A++' to ·o·
• 'A '-quality malls are the destination reta il centers wi th g ood long-term prospects
• ·c ·-quality malls , on the other hand , are typically at a co mpetitive disadvantage and
their long-tenn vi ability is often in questi on
8 • comnant mal in a top mori<et
• luxury inline and .-.chor tenants
• Strong demographics
o Best·in-class sales productivity
• Retailer "Wailing lisr for space
o Strong tourist draw
• Mx of ~end and national tenants
• Hgh occupancy and sales productivity
• Strong tenant den"and f or space 0 • Good demographics
8 • Generally stable sales productivity • Low sales productiv~y
• Mx of national and regional inline tenants 8 • Large rrix of regk>nal and local retailers
Best mal m small market C/0 • Declining occupancy
.. or !hO-c!-best mal11 a five-mal town • Some non-retail tenants
Sotid occupancy • 0'18 or rrore anchor vacancies
8 WV\'\'/ GR r ENSTREF.TAOVISORS.COM
Mall 101 : Assessing Mall Qual ity
Th ere are over 200 mall s in the U.S. that are con sidered ·c· or below in quality,
w hich are the most at nsk to close over the next several years
• However, these malls only account for roug hly 5% of mall value in the U.S ... mo st
won't be missed
160
140
120
100
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U.S. Mall Distribution by Quality Grade
a% of Value aMall Count
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~
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A-B+ B B-C+
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c C-0
25%
20%
.,
1 5% ~ >
'lij
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Mall 101 : Mall Net Operating Income
1C
Roughly 80'1'> of mall NOI is generated from in li ne tenants
Rents are usually based on a combination of retailer sales productivity, profitability
an d demand for space within the cen ter
As sales p roductivity g rows, a landlord's abili ty to push re nts generally increases
U.S. Retail Space by Format
Typical NOI DlatnbuUon
Sales/s.f. of Prominent Mall Retollers
lilfany&Co . i§§§§~§p:==~· ................ u.s.
U liemon
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Gop -
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Ct-.:tren's Place -
so $1,000 S2.000 S3.000
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Key Drivers of Mall Fundamentals
Nea r-peak occupancy levels and minimal new supply are posit ive drivers
Tenant sales have be en impressive rece ntly. but some of the growth has been
d rive n by th e closing of unp roductive retaile rs -market rents are likely to keep pace
Posjtiye Qrjym of Mal Eypdamenta!s Ncaatiyc Qrjye11 of Mall Eyndamcntala
-.. ,_,. pellkOCWJ>MCY--_::;;;_-_-. -..... -:2:-::-.. -:1 •• .belt occupancy recently dpped
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Mall Asset Valuation : Climbing Higher
• Mall asset values are up over 30% versus the prior peak
High-en d malls have been the driver an d cap rates for the best malls are under 4%
The average mall REIT po rtfolio cap rate is 5%
Mall Asset Pricing 'Yo Change in Mall CPPI
CPPI (lnliered to 1m In Jlly '07) -Nomn.tc:.pR:atH(rtllt ull)
134 10%
•:J.Mo, 0.fliO 12-Mo. Cf!W\gc
130 12%
9%
120 11%
8% 10'/o
110 7%
100
6% 8%
5% 90
6%
80 4%
70 3% 4%
01 : ~ i r 1 I
2% 60
2%
50 1% 1%
40 ----'-"-' I 0% -0%
·oo ·o1 ·o2 '03 '04 ·os "06 '07 ·oa ·og 'IO '11 '12 '13 '14 '15
12 VVWVJ.GREENSTAEET AD VISORS .COM
What's On Our Minds: Tourism
Spending by internati onal tourists is an important driver of m all sales in th e U.S.
With few er dolla rs to spend due to current exchange rate s. foreig n tourists wil l
undoubtedly travel less frequen tly and spend less enthusiastically
As a res ult , market rent g row th forecasts co uld be impacted at gateway market
re tail venues that re ly on foreign tounsts fo r a d isproportionate am oun t of th eir sales
$15
iii' $13
e
~ $11
11 >
~ $9 .
:1 $7 = 2
-oi w
$5
$3
'""
Size and REIT Ownership In Top lnt'l Tourist Des tinations
0 Orlando
so ..
• Miami
O LA
0 Chicago
O DC
.. ...
0 L as Vegas
0 Boston
0 NYC 0 San Fran
70%
%of R EIT Owned (pro rata)
0 Northern NJ
8<) .. !10%
Honolulu 0
100%
-------~--------.. ~---··--------
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What's On Ou r Minds: eCommerce
?u:-:-
1~~
1'l"
~~~
01'-
1-1
• Online sh opping wil l continue to ta k e up a larger share of reta il sales creating a
drag on the sa les growth at physical stores
Better quality ma ll s and shoppi ng centers are adapting and will be fine. but lower
quality centers will face increa si ng headwinds
eCommen:a Morbi Shar•
.,_ ofRet.aRSales ~ M>bVetlic:,H, Gos , Food
and Food Ser-Ac.es , and Buidi'lg M1ten.M•
%c1Reta1Saftl et~V~Htne!Gas
'92 '94 '96 '98 '00 '02 '04 '06 '08 '10 '12 '14
eC o mmen:e Risk
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O~c:cuy • .ndlortd Con t.:tt£
W\\'',V.GR~ENSTRECTAOV ISORS .!!OM
What's On Our Minds : Non-Traditional Tenants
'5
• Non-traditional tenants are opening across t he quality spectrum to much fanfare
and are an important source of demand
In addition, several "online-only" retailers have begun to ope n physical locations as
they are realizi ng the importance of having a physical presence
• These unlikely sources of tenant demand should help offset store count
ra ti onalization among mature retailers
Online Rltlailen
REniHC RUnWAY
OII.T } ..... FRANK
TO~S l\ & OAK
BA UBLEBAR
WARBY PARKER
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::f!l:"'~'l4!1f'' ~~~ $ATHLETA ,,:.,.,.,.u , ........
\N\Wf.GREENSTREE.T AOVl SO RS COM
What's On Our Minds : 'C'-Mall Financing Environment
• Financing standards for low -pr oductivity malls appear to be tightening and moving
up the qual ity scale-the new line in the sand to get non-recourse secured
fina ncing appears to be around $350 sales/s.f. (akin to 'B-minus' quality and below)
Borrowers are faced with hig her rates . lower loan-to-val ue (LTV) ratios , or both
The i nabil ity to secure acceptable financing is likel y th e primary reason that there is
l ittle-to-no demand to buy low-quality malls
Case Study: Hypothetical Private Equity Transaction on 'C' Malls
•Levered IRR on 'C'·Mall Purchase at ~2% Cap Rate a Transaction Cap Rate to Achieve 20% Levered IRR
22% ........... .
20%
18%
16% 0
14%
12%
'-· ~~ 10% ___ ___j
10% LTV 6 0%LTV 50% LTV
16 WWW.GREENSTREETAOV!SORS.COM
Strip Centers: A Different Style of De velopme nt
17
Urbanization is a big theme th is cycle: l iving i n city centers is popular
Strip center developers are more focused on established su bmarke ts
Land costs are high -single-floor retail generally does not pencil
Partnering with residenti al or office developers on mixed-use projects is a w ay to
gain access to infill sites , but it is no free lunch
4~
.;1
Se lf Land to Re$i Develop er
.. , ·~ ···--· ...... ·-·········· ..... ,
Monetizes land, but gives j
~upside potential to l'e$i :
-lope<. Less site contrOl. ~ ·············· .................... .
lillr..W.. o...lopment T'*"lfa
No proceeds from tanc1 sat.,
but shared economies. Mote
• economic rlllk. but more site
• COI>Irolas....,lt.
_........,... ...... ~ .... -............. .
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Own Both ............................................. ,
Highest economk: upsk!e i
potential and control. but a"" i
.......... ~~-~~~ ......... ~.l
WWW,GRer;NSTREETAOVTSORS COM
Strip Centers : De m and Tug 0 ' War
• Strip center occupa ncy is high fo r the best properties-anch or space is fu ll
Small shops still have space to fill
Mergers and bankruptcies are a drag on net new s to re openings
p·.,..IIM> Drive rs
of Strip
l'undlmenbll
Anftiiiiii .......... Q'..tt.,IIS -
NeplveDrivers
of Strip
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t old ll:nant cletmnd ........... lo!aUig? i --------
-TMsnt mergers Md
+ Specially grocem arw blmkru p~lu hiM! led to
opc!IIGig new atoft'r: ..,d lnOcleatstore closures;
(13 ,. ,, )
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~-~ # -. ~ dotwlng5lgnllcant fralle could lnl>nt be 0. lhe
. ~~·.;.~"!!'~~~=--===.:.;:.;;.:;;.== -==-...:=-.::~·-~~~?=~-==="="=· ~
18 WWW.GREENSTRF.ET ADVISORS .COM
Strip Centers: Tenant Sales Increasing (a little)
19
• Increasing tenant sales is a precursor to rent growth
While tena nt sales are growing , the pace remains modest
High occupa ncy and little new supply has helped support decent rent growth
,.
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ReUil ler sam.-store S.les GroWitl
('07oi00)
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1%
la<t 3-la5t 12 Months
W'-o\W.GREENS TREET AOVI SORS .COM
Strip Centers : Enter the Specialty Grocer
20
Grocers provide sig nificant tra ffic flow to shopping centers
Traditional grocers have been rationalizing store counts
• Specialty grocers have been opening many new stores
• Wh ile sto re sizes are smalle r than traditional grocers , consumer traffic is l1i gh
1.800
1.800
\.COO
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800
.000
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-·---~-... ---· WV'N/.GREENSTREETAOVISORS .COt.~
Strip Centers : Asset Values
Strip center asset values are up -15% v ersus the prio r peak
This an"'lys is fo c uses on REIT properties. which are of above-average quality
Cap rates for the best strip ce nter assets ca n be as low as 4 %
The average strip center REIT portfolio c2p rate is 5 .5%
S1rlp Cenllr MIMI Yalues %Change In S1rlp CPPI
$tftpCPPf(hjn-.d to tOO•»t'01) -~c.r.·~CIP Alt ... (~ a.:s)
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21 WONW.GREE NSTREETAOVISORS.C0~1
Strip Centers : Trade Area Powe r (TAP) Sco res
• TAP Scores are a proprietary Green Street too l used to e va luate trade areas
Incomes, density. cost of living . and educa tion a re taken into account
• The to ol analyzes trade-area demand only-supp .y is ignored
• Scores range from 1 to 100 (h igher scores a re better)
1!0
70
110
50
~
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TAP Sc"'" by lllortcel lor AErr.OW....-1 ANom
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22 WI.'VW GREENSTReET ADVISO RS .COM
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Gtt-en Street Advis or s. LLC
660 Newport Center Drive, su~e 600
Newport Beach, CA 92660
T 949.640.6780 F 949.640.1773
24
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NEWPORT BEACH I DALLAS I LONDON
www.GreenStre«rAdvisors.com
Gmon Stroot Tr.:1ding
600 North PeM Street. sutte 2310
Dallas , TX 75201
T 21 4 .749.4730 F 214.749.0122
Grc"-Vn StruQt Advisor s (UK) Limited
20 Balderton Street. 5th Floor
London W1K Gn., United K ingdom
T +44 (0)20.3793.7000 F +44 (0)20.3793.7001
-----------
INW't"J.GRtEN STREEi ADVISORS .C OU
From : susie ferrell [mailto:susie ferrell @ya ho o.com]
Sent: Tuesday, July 05, 2016 4 :0 8 PM
To: North40 Comment
Subj ect: Please stop the madness ....
To Whom it May Concem-
1 am writing in oppos ition to the proposed North 40 Development. Many things d efine our community. but
probably the mos t important is our charming downtown . The Downtown cannot be replicated by any
development. but it can be ham1 ed by one. The North 40 development before yo u will do seriou s damage to
the economic vi ta li ty of the dm,vntown. The Los Gatos downtown is a fragile entity and it re quires a critical
mass of people to be vibrant: people walking the s treets and the s hopping. The North 40 Specific Plan allows
for 400,000 new s quare feet of retail ( 60,000 sf in the firs t proposal). That is not much b elow the 525.000 sf of
retail at Santan a Row. O ur downtown has not more than 230.000 s f of ground floor retail. Combine the North
40 project with the damage a lready done to the downtown from competition b y the revitali zed dow ntown
Campbell and we have the potential for a serious drop in people v isiting our downtown. What happens if 1 0 to
20 % less peopl e vi s it the Downtown? The North 40 will have beautiful walking streets. plenty of new
restaurants with outdoor seating, national ret ail s tores, a nd abundant parking conveniently o ff the Lark A ve
exit ofHigbway 17. As one of the current council members wrote during the North 40 study session: "It i s
difficult to see what specific restaurant and retai l providers would not impact our downtown "
The North 40 proposal s tands in direct contrad iction to the Town's North 40 Vi sion Sta tement. How is 400.000
sf of retail ''seamless ly woven into the fabric of our community ... complementing ... other Los Gatos residentia l
and bu siness neigh bo rhoods ." And s uppos edly th e North 40 will " ... address th e Town's ... commercial unm e t
needs." Does Los Gatos h ave 400.000 s f of "commercial unmet n eed s?" Does anyo ne reall y believe that?
Do we want the downtown to b ecome l ik e Saratoga's? The North 40 w ill d o to our downtown w hat Valley Fair
and Sa ntana Row has done to Downtown San Jose: destroy it. Our Down tow n is under attack fr om traffi c
congestion, l ack of parking, and competition. The planning Commission and Counci l shou ld b e worki ng to
promote our Downtown, not voting for a second one.
I s trongl y urge you to vote against thi s North 40 Development Propos al.
R egards -
Susun F e rrelf
Ba_v Area Interior Plants
244 Cerro Chico
Los Gu tos
(408)656-0281
From: Pamela Parisi [mailto:parisipamela@yahoo.com]
Sent: Tuesday, July OS, 2016 7:26 PM
To: North40 Comment
Subject: opposed to North40
Dear Los Gatos Planning Commission,
I am writing in opposition to the proposed North 40 Development. Many things define our
community, but probably the most important is our charming downtown . The Downtown
cannot be replicated by any development, but it can be harmed by one. The North 40
development before you will do serious damage to the economic vitality of the downtown .
The Los Gatos downtown is a fragile entity and it requires a critical mass of people to be
vibrant: people walking the streets and the shopping . The North 40 Specific Plan allows for
400 ,000 new square feet of retail (60,000 sf in the first proposal). That is not much below
the 525,000 sf of retail at Santana Row . Our downtown has not more than 230 ,000 sf of
ground floor retail. Combine the North 40 project with the damage already done to the
downtown from competition by the revitalized downtown Campbell and we have the
potential for a serious drop in people visiting our downtown. What happens if 10 to 20% less
people visi t the Downtown? The North 40 will have beautifu l walking st reets, plenty of new
restaurants with outdoor seating, national retail stores, and abundant parking con veniently
off the Lark Ave exit of Highway 17. As one of the current council members wro te during the
North 40 study session: "It is difficult to see what specific restaurant and retail providers
would not impact our downtown "
The North 40 proposal stands in direct contradiction to the Town 's North 40 Vis ion
Statement. How is 400,000 sf of retail "se amlessly woven into the fabric of our
community ... complementing ... other Los Gatos residential and business neighborhoods."
And supposedly the North 40 will " ... address the Town 's ... commercial unmet needs ." Does
Los Gatos have 400,000 sf of "commercial unmet needs?" Does anyone really believe that?
Do we want the downtown to become like Saratoga 's? The North 40 will do to our
downtown what Valley Fair and Santana Row has done to Downtown San Jose: de stroy it.
Our Downtown is under attack from traffic congestion , lack of parking , and competition. The
planning Commission and Council should be working to promote our Downtown , not voting
for a second one.
I strongly urge you to vote against this North 40 Development Proposal.
PAAf PARISI
P SQUIIRED S T!!::ilOS LlC.,
htto: //www.PSquaredStudios.com
https: //www .facebook.com /pages I P-Sguared-Studi os-LLC/241518835888575
July 6, 2016
Members of the Planning Commission
100 E. Main Street
Los Gatos, CA 95030
SUBJECT: REASONS TO DENY THE PROPOSAL FOR THE PHASE 1 DEVELOPMENT OF
THE NORTH FORTY
Dear Members of the Planning Commission:
Please deny the Phase 1 application for the reasons given below.
1. The proposed development does not fulfill the requirement in the Specific Plan that
"The North 40 will look and feel like los Gatos." (p. 1.1) A look at the elevation drawings
in the Phase 1 proposal easily demonstrates that the proposed project has neither the look
nor the feel of Los Gatos. Drawings on pp. 72-7 4, 90-120, 133-165, 170-184, and elsewhere
clearly show boxy, massive, heavy-looking buildings that have nothing in common with the
look and feel of Los Gatos. These are suitable for an urban, not small-town, setting.
The developer claims that almost anything can look and feel like Los Gatos because there is
a wide range of "looks" in our town. I disagree with this. I believe that when we think of how
Los Gatos looks and feels, we think of our beautiful downtown and the Almond Grove area
with its lovely landscaping and varied , interesting homes.
Just as an aside, tandem garages as shown , for example, for Plan 2, Plan 2X, Plan 3, Plan
2, and Plan 6 don 't match the look and feel of Los Gatos.
2. The proposed development does not fulfill the requirement in the Specific Plan that
"The North 40 will embrace hillside views, trees, and open space." (p. 1.1) Based on
Wendi Baker's comments at the March 30, 2016 Planning Commission meeting, the design
addresses this principle by allowing for views from the periphery of the property through
setbacks along the periphery. It also provides views through "view corridors," which are
essentially streets.
Clearly, the density and height of the buildings within the development block hillside views .
Reducing this density and providing more open space would remedy this problem .
3 . The proposed development does not fulfill the requirement in the Specific Plan that
"The North 40 will address the Town's unmet needs." (p. 1.1) The Town anticipates that
the development will address the Town 's unmet need for affordable housing , but this will not
happen. The proposal includes only 49 units of affordable housing, the senior apartments.
Further, during discussions about the North Forty, unmet needs included sports fields ,
stepdown housing for seniors , community buildings, and schools . None of these are
included in the proposal.
1
4 . The proposed development does not fulfill the requirement in the Specific Plan that
"The North 40 will minimize or mitigate impacts on town infrastructure, schools, and
other community services." (p. 1.1) The proposal fails to mitigate impacts on Los Gatos
schools by locating all residential within the Los Gatos School District. Clearly, the option
was there to not use the entire inventory of housing within the Lark and Transition Districts
and to allow some or even all to be located within other school districts.
5. The proposed development does not fulfill the requirement in the Specific Plan that
the North 40 will "incorporate the site's unique agricultural characteristics." (p. 1.1)
According to Don Capobres (remarks, Planning Commission meeting, March 30, 2016), a
large marketplace will be the centerpiece of the development's "celebration of the site's
agricultural heritage." While the marketplace would be a fine addition to the community, a
store in no way replaces a true celebration of an agricultural heritage, which would involve
ample open space integrated throughout the community and used to give the area a feeling
of lower intensity. There should be a more suitable "centerpiece ."
6. The development would move forward in a piecemeal fashion. In the Specific Plan , we
see this statement: "The intent of this Specific Plan is to provide a comprehensive
framework in which development can occur in a planned , log ical fashion rather than a
piecemeal approach." (p . 1-1) The public has no way of knowing what is intended for the
remaining 24 acres of the property. Development should not go forward until more
information is provided.
7. The Specific Plan calls for lower density in the Lark Area. The developer has given us
very high density instead. When Mr. O 'Donnell asked at the March 30 Plann ing
Commission meeting why all the residential was in Phase 1, Mr. Capobres wrongly cla imed
the Specific Plan called for this. This isn't true . The Specific Plan actually says that in the
Lark District "Lower intensity residential and limited retail/office uses are envisioned ... " (p.
2-3). The density of the proposed Phase 1 development would need to be reduced to meet
the requirements of the Specific Plan .
8 . The Specific Plan calls for residential to be located throughout the 44 acres. However,
the developer has included all residential units in Phase 1. It would be reasonable for
fewer than 6 of the 13.5 acres set aside for residential to be in Phase 1. Please deny the
proposal so a more fitting proposal can be brought forward that spreads out residential.
9 . Claims that residential units are aimed at millennials and seniors seem false. The
proposed housing will have far great traffic and school impacts than true senior or
millennia! housing would have. At the March 30 meeting and other meetings, Ms Baker
claims residences were designed with seniors and millennials in mind . If this is true , why are
there so many 3 -story, 3-bedroom units that are almost 2,000 sq . ft.?
Let's look at rowhomes. There are 97 of these ranging in size up to alm ost 2 ,000 sq . ft. Most
are 3 bedrooms or 2 bedroom s plus a den. A family with 2 school-age children would be
very happy in these. But how about our seniors and millennials? Why not take these 97 3-
story rowhomes and turn them into twice as many units of smaller size? We could have 194
2
1,000 sq . ft. flats in comfortable 2-story structures. We would thereby fulfill our housing
requirements while reducing density. Los Gatos doesn't want the tall, massive, high density
units the developer proposes , and they are inappropriate for this site with its traffic and
school issues . Deny this proposal and seek a proposal with smaller units that really serve
the needs of seniors and millennia Is .
I was dismayed when I first learned about the Housing Element requirement of 13.5 acres
at 20 units per acre being used in the North Forty. This seemed in clear opposition to the
notion that the development would retain an agricultural feeling.
With further thought, however, I realized that the Specific Plan does not specify how big the
20 units on each acre need to be ; no square footage is stated . We can still satisfy RHNA
requirements with 20 1-bedroom flats or 2-bedroom flats that are 1,000 sq . ft. or smaller.
Clearly, 1-and 2-bedroom units (and studio apartments for that matter) are a less intense
use of the land, will be more affordable , and can be designed to be more in keeping with
Town guidelines and principles.
We just need to meet the 320 unit housing requirement. Here's an example of how
to exceed that requirement with smaller, more appropriate units.
Instead of:
• 97 massive 3-story town homes
1 ,500+-1 ,900+ sq ft
• the 50 3-story massive garden
cluster homes 1,400+-1,870 sq ft
Have:
194 flats c. 1,000 sq ft in 2-story buildings
100 flats c. 1,000 sq ft in 2-story buildings
Totals when 50 senior affordable units are added:
197 units vs. 344 units
The developer's proposed 3-story rowhomes, garden cluster homes, and condos
completely fail to meet Specific Plan requirements on many counts : (1) They do not look
and feel like traditional housing in Los Gatos. (2) They block views of the hills. (3) They are
likely to negatively impact our schools and infrastruc ture since many have 3 or 2+
bedrooms and are likely to appeal to families with children and more than 2 cars .
10. The Town will not get the RHNA credit it is expecting. The dev eloper is using the 20
un its p e r acre dictate, which I believe is intended to accommodate the Town's unmet need
3
for affordable housing. One Town official told me the Town thinks it will get credit for 310
affordable units. However, when asked about this , Staff did not provide a response .
PLEASE NOTE: I SUBMITTED THE QUESTION BELOW TO STAFF BUT HAVE , TO DATE, NOT
RECEIVED A RESPONSE . THE NUMBERS IN THE TABLE BELOW ARE MY BEST GUESSES
SINCE STAFF HAS FAILED TO GIVE ME AN ANSWER. I HOPE A PLANNING COMMISSIONER
WILL ASK THE QUESTION BELOW
The RHNA requirements listed in the current Los Gatos Housing Element from 2015 in Table H-1
show the following number of housing units needed between 2015-2023: 201 very low; 112 low;
132 moderate; 17 4 above moderate. How many units in each category are proposed for Phase 1
of the North Forty by the current applicant?
The Phase 1 proposal itself shows only 49 affordable units , the senior housing . The
developer does not appear to intend to sell or rent the remaining units as affordable
housing . The units will apparently be sold as market-rate housing instead .
WHAT WE NEED WHAT THE TOWN WHAT THE
THINKS IT WILL DEVELOPER IS
GET CREDIT FOR PROPOSING
VERY LOW 201 49 49
LOW 112 0 0
MODERATE 132 1 0
ABOVE 174 260 0
MODERATE
TOTALS 619 310 49
According to the Town official , the townhomes proposed for Phase 1 are in the over 120%
AMI category. This means someone with an income of $128,520 should be able to afford
them . Using the Zillow affordability calculator, with 20% down, someone with that income
could afford a home costing $661,283 . However, Grosvenor/Eden are talking about these
homes costing at least $1 million, thereby removing them from any affordable housing
category.
According to the RHNA website, "Densities of housing developments do not describe
affordability for the purposes of crediting units against the jurisdiction 's RHNA."
11. The Specific Plan does not call for 13.5 acres of housing at a density of 20 units per
acre. This comes from the Housing Element and I believe the intent was that this
density would be used to create housing that could classified as "affordable
housing." Since only 49 of the 320 units would be affordable housing, the use of
high density development doesn't seem appropriate.
Since only 49 affordable units will be built, does this mean the Town will need to find 11
acres elsewhere for the high density affordable housing units it expected to get credit for on
the North Forty?
4
12. Senior housing is poorly planned. Jamming this housing above the marketplace and the
garage is poor design since it creates a situation where we have a building that is more than
50 feet tall. This will be unattractive, does not create an agrarian feeling in any way, and will
obstruct views. The location of the housing also puts seniors in the middle of the hubbub of
major activity, which might be desirable for millennials but is not likely to be welcomed by
seniors. There are good places for grouping senior housing on the site that don't create
these problems .
On p. 7 of his proposal , the developer states under "realizing the Vision " that "Smaller
senior affordable apartments will be located alongside retail and homes for young
professionals, creating a diverse and sustainable neighborhood ." In fact, all the senior
affordable housing is on the third and fourth floors of the marketplace building . The units are
not, in fact, located in a way that makes them part of "a diverse neighborhood." Senior
affordable housing should be located where it really IS in fact i ntegrated to be more part of
the diverse community.
13 . Some parking is problematical. Many of the resident ial units have tandem parking . I thin k
this is evidence of poor design. The developers are simply cramming in as much as they can
without focusing on good design. At the very least, we should request a modifi cation in th is
design . Cars backing out to let out second cars parked in the interior will create traffic
problems and dangers.
In addition, senior housing is given just .5 spaces per unit. It is very unlikely that every last
senior will not have a car. This needs to be corrected to allot at least 1 space per senior unit.
I sympathiz e with the developers , who have expended so much of time , money, and energy in
championing their proposals . However, this is no reason to approve the proposal. The current
proposal is deeply flawed and needs to be den ied . I do think the deve lopers have been involved
in a certain amount of bait and switch . I attended several of the developers' meetings during
which pictures of charming Los Gatos-style buildings were shown surrounded by ample green
space and wandering pathways . I listened as the developers talked about stand-alone c harming
cottage cluster units . We see none of this in the developers' actual proposal. Please deny the
application and demand a development that is in keeping with the vision of our specific plan and
the wishes of most of the residents of Los Gatos.
Sincerely,
Barbara Dodson
239 Marchmont Drive, Los Gatos
5
From: Ferida Nydam [mailto:ferida@me.com]
Sent: Wednesday, July 06, 2016 1:22 PM
To: Joel Paulson; Planning; Sally Zarnowitz
Subject: North 40 project -upcoming meeting
Dear planning commission,
I 'm a Los Gatos resident and am quite concerned about the impact of the North 40 project on our
community and the future of our town. Los Gatos is a gem in the bay area, the town has done
such a great job building a sense of community in our schools and in our neighborhoods. The
current proposal for this development does not align with who we are as a community and who
we want to be. Please do not approve this developer's plans, as they need to be modified to
complement who we are. I have two children who are in schools here. Our schools are already
beyond capacity and the excessive car traffic on the streets already make walking to Fisher and
Blossom Hill a huge challenge from a safety perspective. I have seen nothing in the plan that
speaks to the addition of middle school and high school. Our streets are already jammed in the
mornings and traffic is making even a simple grocery store run or a doctor's office visit
impossibly painful. ·
I ask that you reject the current proposal and work with the developer on an alternative
that aligns with our town's look and feel.
Please note the following:
-The phase I proposal shows industrial 3-5 story buildings that do not align with our look and
feel.
-The Specific Plan says "Lower intensity residential and limited retail/office uses are
envisioned ... " for the Lark District (Lark/Los Gatos Blvd.) (pp.2-3) The developer has instead
proposed highly intense development-including massive 6-, 7-, and 8-unit 3-story rowhome
complexes and commercial/residential space up to 51 ft. high. (This is taller than the Albright
buildings.) ·
-The intensity and height of buildings limit open space and block hillside views
-The Specific Plan states the development should "address the Town 's unmet needs." P 1.1
-Move-down housing for the Town's seniors and millennia! housing is not provided.
-Only 49 very low income senior apartments are provided. No other affordable housing will be
built.
-The retail as proposed duplicates that provided elsewhere and competes with rather than
complements the downtown commercial space. P2.2
-The proposed development doesn 't "minimize or mitigate impacts on town infrastructure,
schools, and other community services." P 1.1
-Schools, street, and other services will be adversely affected
-Mitigation measures are based on dated studies and do not sufficiently address adjacent
pending and incomplete developments.
-The Specific Plan states the intent is "to provide a comprehensive framework in which
development can occur in a planned, logical fashion rather than a piecemeal approach." P 1-1
-Phase I includes only a portion of the 44 acres. The current application is just part of a
piecemeal approach since no information is provided about Phase II .
Regards,
Ferida Nydam
16162 Lilac Lane
Los Gatos
From: BSpector
Sent: Wednesday, July 06, 2016 3:02PM
To : Laurel Prevetti
Subject: FW : North 40 Development
For Planning Commission and public
From: C. Lee McKenzie [cl ee38 @qm ail.com] on behalf of Cheryl McKen zie [cl ee 38 @icl oud .com ]
Sent: Tuesday, July OS, 2016 8:42 PM
To: BSpector
Subject: North 40 Development
Dear Ms. S p ect or,
I'm a long-time res ident who is wtiting in oppos it ion to the proposed North 40 Development.
As I see i t. we are already on our wa y to becomin g an open ma ll. There only a few shops that s till
keep the fl avor of what we once had: Los Gatos Roastin g, Vi ll age H ouse of B ooks (thanks for a
s mall book s tore again). Bunches, Voluptuary a nd some independent resta ura nt s come to mind. And
tha nk s tor the Lo s Gatos Theater. But as more of the chains are allowed in, th e uniqueness o f our
to wn disa ppears bit by bit. I might as well sh op a t Santana row or the Mayfair Mall. Blac k a nd
White are there. Gap is there. Ta lbots is there.
I c hose to l ive here b ecause it was un ique. Touris ts come becau se this is a p lace th a t has a di fferent
look. a diffe re nt flavor than other p laces in Ca li fornia. A ll ow the Notth 40 development and yo u 're
go ing to lo se th e last of that uniqu e quality. Allow the North 40 developme nt and yo u 'll kill
downtown Lo s Gatos in the same way Valley Fair kill ed dovvnto w n San J ose.
How disgraceful to r e peat such a mi stake.
Our downtown is already und er attack from traffi c congestion , lack o f parking, and com petiti o n.
The p lanning Commiss ion and the T own Coun c il sho uld be working to promote our Downto·wn, not
votin g tor a second oue.
I s trong ly urge you to spea k agains t this North 40 Deve lopment Proposa l.
C hetyl McKenzie
For public record
From: Scott Miller [hedrinkbeer@gmail.com]
Sent: Wednesday, July 06,2016 3:07PM
To: BSpector
Subject: North 40
Please dont vote for this development plan! It is ill conceived and will be harmful to the town of
Los Gatos and its citizens.
Scott Miller
Los Gatos, CA
From: BSpector
Sent: Wednesday, July 06, 2016 5:44PM
To: Laurel Prevetti
Subject: FW: opposed to the North 40 Development
For public record
From: oakmeadowdental @aol.com [ oakmeadowdenta l@aol.com]
Sent: Wednesday, July 06, 2016 8:35 AM
To: BSpector
Subject: opposed to the North 40 Development
Dear Mayor Barbara Spector,
We are the owners of Oak Meadow Dental Center and have been in this area for 16 years . We
are writing in opposition to the proposed North 40 Development. Many things define our
community, but probably the most important is our charming downtown. The Downtown
cannot be replicated by any development, but it can be harmed by one. The North 40
development before you will do serious damage to the economic vitality of the downtown . The
Los Gatos downtown is a fragile entity and it requires a critical mass of people to be vibrant:
people walking the streets and the shopping. The North 40 Specific Plan allows for 400,000 new
square feet of retail (60,000 sf in the first proposal). That is not much below the 525,000 sf of
retail at Santana Row. Our downtown has not more than 230,000 sf of ground floor retail.
Combine the North 40 project with the damage already done to the downtown from
competition by the revitalized downtown Campbell and we have the potential for a serious
drop in people visiting our downtown. What happens if 10 to 20% less people visit the
Downtown? The North 40 will have beautiful walking streets, plenty of new restaurants with
outdoor seating, national retail stores, and abundant parking conveniently off the Lark Ave exit
of Highway 17. As one of the current council members wrote during the North 40 study session:
"It is difficult to see what specific restaurant and retail providers would not impact our
downtown". We have heard from several downtown businesses in recent weeks that have been
affected by the traffic to the beach, where the parking lots are empty downtown but the traffic
to get there is a deterrent. We know that the Happy Dragon Thrift Shop had to close its doors
on Saturdays since its volunteers cannot get to work! Several patients and friends are looking
for other places to go to dinner to avoid the traffic in downtown, this is already an issue .
But more importantly for us, is that our children attend public schools in the Los Gatos and with
the increase in children proposed with the new housing at North 40, these already packed
schools will gravely affect the quality of education that Los Gatos has been priding itself on . The
developers know that people will buy in Los Gatos to have the property values associated with
great schools, but as those schoo ls become too full, the children's education will suffer, and our
the property values will drop dramatically. We are concerned this will impact so much more in
our city in the near future and Los Gatos will no longer be able to toot it's horn about great
schools when there will be 40+ kids in each elementary class . The teachers will not be able to
give the individual attention and the schools will become like those in San Jose and surrounding
areas . We have teachers as patients and friends in these other school s and many are moving
out of the area or looki ng for work in private school s.
The North 40 proposal stands in direct contradiction to the Town 's North 40 Vi sion Statement.
How is 400,000 sf of retail "seamlessly woven into the fabric of our
community ... complementing ... other los Gatos residential and business neighborhoods." And
supposedly the North 40 will " ... address the Town's ... commercial unmet need s." Does Lo s Gatos
have 400,000 sf of "commercial unmet needs?" Doe s anyone really believe that? Do we want
the downtown to become like Saratoga 's? The North 40 will do to our downtown what Valley
Fair and Santana Row has done to Downtown San Jose : destroy it. Our Downtown is under
attack from traffic congestion, lack of parking, and competition . The planning Commission and
Council should be working to promote our Downtown, not voting for a second one .
I strongly urge you to vote aga i nst this North 40 Development Propo sal.
Drs. Fantino & Dyer
Sent from Windows Mail
-----Origi na I Message-----
From : Harris Family [mailto:moejam13@icloud.com]
Sent : Wednesday, July 06, 2016 8:56 PM
To : North40 Comment
Subject: North 40? No thanks!
Dear Los Gatos Planning Commission,
We are writing to strongly oppose the proposed North 40 Development. We moved to Los Gatos over 8
years ago to join a wonderful community that takes pride in its dog-friendly, quaint town and enjoy the
perks of this daily, e.g ., having actual friendships with neighbors, being able to walk/bike to our nearby
grocery stores like Whole Foods and Lunardi 's, church, dine in unique and delicious restaurants that are
not part of a chain, like Steamer's, Nick's and Hult's. Then there's Manresa Bread and Icing on the Cake -
one could not ask for better bakeries anywhere!
We also revel in the fantastic concerts (Music in the Park and Jazz in the Plazz), love being steps away
from Testarossa Winery and tasting rooms such as Left Bend and Enoteca La Storia . The library, NUMU
Art Museum, Vasona lake, Oak Meadow Park and Village House of Books are wonderful places to spend
time at, let alone the unique stores we shop at downtown on Santa Cruz and University Avenues.
Each winter we enjoy the horse-drawn carriage rides and in Summer the Fourth of July festivities are not
to be missed . There is a real sense of community and like-mindedness year-round here and it's centered
around family and friends.
We lack nothing in los Gatos so the notion of the proposed North 40 is preposterous! Why would we set
ourselves up for traffic congestion because of a development that certainly does not fit into our town?
If retail and living space is desired, Santana Row already exists and it is less than 7 miles away. Please,
let's allow los Gatos to remain the gem in this valley.
Sincerely,
Monique & James Harris
16945 Roberts Road
Los Gatos, CA. 95032
Sent from our iPad
From: Kristen Willerer [kwillerer@gmail.com]
Sent: Wednesday, July 06, 2016 9:26 PM
To: BSpector; Marice Sayee; Rob Rennie; Steven Leonardis ; Marcia Jensen
Subject: Please Deny the 40N Development!
Here are some reasons why I would like to deny the 40N Development:
The proposed development is required to "look and feel like Los Gatos." P 1.1
The drawings for the Phase 1 proposal show boxy , massive, industrial style 3 -5 story buildings that have nothing in
common with the look and feel of Los Gatos
The Specific Plan says "Lower intensity residential and limited retail/office uses a·re envisioned ... " for the Lark District
(Lark/Los Gatos Blvd .) (pp.2-3) The developer has instead proposed highly intense development-including massive 6-, 7-,
and 8-unit 3-s tory rowhome complexes and commercial/residential space up to 51 ft. high. (This is taller than the
Albright buildings .)
The proposed development must "embrace hillside views , trees, and open space ." P. 1.1
The intensity and height and layout of the buildings block hillside views and provides minimal open space .
Relocating some of the residential in the Lark District to the North would alleviate some of the loss of views as would
reducing the height and create more open space.
The proposed development must "incorporate the site's unique agricultural characteristics ." P. 1.1
All the walnut trees will be removed . The site will be planted with other trees, mostly deciduous, that will take years to
grow.
Thank you for reading this.
I live at 104 Cherry Blossom Lane and this would greatly affect my children's schooling as well as the neighborhood .
Kristen Willerer, DPT
408.458.0006
For Planning Commission/public record
From: Stephens, Caissie [ cstephens@sjusd.org]
Sent: Wednesday, July 06, 2016 10 :17 PM
To: BSpector
Subject: LG RESIDENT FOR 45 YEARS
Dear Barbara Spector,
I am sending this email to voice mine and my families concern about the N 40 Plan. Please do
not move forward this plan. My husband was born in this town, and my children, have either
graduated from LGHS, or are presently still at the HS. I understand change happens, but sadly
so much change has happened in this town, as it has lost so much of its's town
character. Presently, it can take at 3:00 25 minutes to travel down LG Blvd to pick up my child
at the HS. Then another 25 minutes to get back home. We live off of Chirco by Nob Hill
grocery store. I can not even imagine what the traffic will be like. With all of the weekend
traffic and beach traffic now, we will decide to sadly leave LG, our home, as living here would
become a traffic nightmare. Please do not sell our town.
Thank you for listening, Caissie, Rich, Sammy and Sydney Stephens.
Planning
From:
Sent:
Dan Cunningham <dan.cunningham@vancebrown.com>
Thursday, July 07, 2016 6:13 AM
To: Marni Moseley
Subject: North 40 Question
Marni-
Most of the available information only addresses Phase I. Please provide, based on specific plan zoning allowances , the
~otal counts (entire North 40 area) including any bonuses as follows:
I. Total number of allowed residential units.
2. Total square feet of allowed commercial space. Is any office space a part of the commercia l space allowance?
3 . Total anticipated vehicle trip counts.
4. Total anticipated additional student count.
5. What schools will be impacted?
The public needs to know what is contemplated for the entire built out site not just Phase I.
R egards ,
Dan Cunningham
3197 Park Boulevard
Palo Alto , CA 94306
Office 650-849-9900
Fax 650-849-9908
Cell 415-559-0449
Emai l dan .cunningham @vancebrown .com
1
From: Mariquita West [mqq west@earthhnk.net]
Sent: Thursday, July 07 , 2016 9 :38 AM
To: BSpector
Subject: Too much retail in North 40 Plan
Dear Mayor Spector,
I was enthusiastic re the North 40 plan because of all the housing it provided, but I did not realize
how much retail space there would be: 400,000 square feet? That would almost surely negatively
impact retail in downtown Los Gatos .
I believe Santana Row effectively sucked the money and energy out of revitalizing downtown
San Jose. I prefer real , hi storic cities like our current Los Gatos to planned d evelopments, even
attractive ones like Santana Row . I live in the hills near Los Gatos and thu s am not an official
resident, but I grew up here and have shopped and dined in the town for over 70 years.
I have seen the town weather many changes and retain its vitality. Having a huge new retail
center just beyond the current retail district worries me greatly, and I oppose the plan unless it
can be modified to reduce this feature.
Sincerely yours,
Mariquita West
P 0 Box 634
Los Gatos, CA 95033
From: steamersoffice@aol.com [mailto:steamersoffice@aol.com]
Sent: Thursday, July 07, 2016 2:38 PM
To: North40 Comment; Steven Leonardis; Rob Rennie; BSpector; Marcia Jensen;
maricosayoc@yahoo.com
Subject: No on North 40
Sent: Thu, Jul 7, 2016 2:34 pm
Subject: No on North 40
To the members of our Council and Planning Commission ,
As a business owner, as well as a resident of the Town of Los Gatos, I am writing in opposition
to the proposed North 40 development. One of the things that keep visitors shopping in our
downtown is the sense of the unique and small town appeal of the businesses. The character of
the downtown can 't be replicated and will be detrimental to any development trying to do so.
The North 40 development before you , will do serious damage to the economic vitality of the
downtown. The vitality of the Los Gatos downtown is fragile and it requires a critical mass of
people to be the vibrant downtown we have all worked so hard in maintaining and continue to
attract people to be walking our streets and shopping at our local merchants and businesses.
The North 40 Specific Plan allows for 400,000 new square feet of retail, far more than the
60.000 sf in this first proposal. That is not much below the 525.000 sf of retail at Santana Row,
which prompted a decline in people visiting town to shop. Consider the fact our downtown has
not more than 230,000 sf of ground floor retail , which currently has empty storefronts as I write
this letter. Add the North 40 project with the damage already done to our Downtown from
competition from the revitalized downtown Campbell and we will experience a serious decline in
people visiting our downtown and patronizing our local merchants . Campbell found a way to
maintain their individuality and a community and keep local businesses thriving without having
to add to the businesses they currently had. I believe we can do the same . We should be
promoting what we have. not what a developer says we need .
What happens if 10 to 20 less people visit the Downtown? Less business for the existing
businesses, resulting in· unemployment for current employees no longer needed , loss of taxes
for the Town of Los Gatos and it will be highly likely to see the closure on many independent
businesses, the one thing that makes the Town of Los Gatos as unique as it is. I think we need
to remember bctek to the 89 earthquake that devastated the downtown and remember how long
it took for the Town to revitalize. How many businesses chose not re-open, shuttering their
doors and disappearing from our community due to financial concerns . The North 40
Development will have the same effect, only this time I don't believe we will be able to survive
as we did before.
According to the plans, the North 40 will have beautiful walking streets, plenty of new
restaurants with outdoor seating , national retail stores, and abundant parking conveniently (?)
off the Lark Ave exit of Highway 17. Try living in that area and tell me how "convenient" it is to
try to get around at certain times of the day. As one of the current council members wrote during
the North 40 study session : "It is difficult to see what specific restaurant and retail providers
would not
impact our downtown." This North 40 proposal stands in direct contradiction to the Town's North
40 Vision Statement. How is 400,000 sf of retail "seamlessly woven into the fabric of our
community ... comp lementing ... other Los Gatos residential and business neighbor hoods." And
supposedly the North 40 will" ... address the Town's ... commercial unmet needs." Does Los
Gatos have 400,000 sf of "commercial unmet needs"? Does anyone really believe that? What
happened to the concept that the Town Council did not want" Cookie Cutter" retailers in our
community? That is exactly what North 40 is purposing to do with "national retail stores".
Running a business in this day and age is not easy, adding more businesses to a community
that already has it's needs met with the current businesses we have will only lead to the
economic disaster of our Downtown. If these national retail stores are so interested in coming to
our Town, why hasn't our council proposed that idea directly to them, filling the empty
storefronts of our downtown.
We already have issues with the congestion created by traffic off of 17. As someone who has to
come to the downtown via Los Gatos Boulevard and Blossom Hill, I have personally
experienced the traffic problems the center located on the corner of those streets has
generated. I have also seen signs indicating storefronts are empty there . Kings Court shopping
center currently has empty store fronts there as well. Adding more traffic to that area off of Lark
Ave will cause even more problems that the ones that currently exist. Have any of you
experienced the morning or evening commute of getting on or off Highway 17 North or South, or
traveling across the overpass to get to Winchester Boulevard on a regular basis? The traffic
currently backs up for 1-2 blocks in either direction getting onto Lark Ave as well as trying to get
on to Los Gatos Boulevard. Do we need to add to this congestion by bringing in a development
that will destroy the downtown we as a Town have worked long and hard to preserve?
There are multiple centers with business located along Los Gatos Boulevard between Blossom
Hill and Lark Ave that fulfill the needs of our community. I would like to know what businesses
the developers of the North 40 think we need . I doubt any of the developers live or work in our
Town limits. How are they qualified to determine what we need in our community, if they are not
a part of our community, living and working here? The ir interest is in turning the property into a
shopping center and leaving us to carry the burden of it. Again, something the Town of Los
Gatos cannot afford to do, physically or financially. What will happen to our schools and
classrooms that are currently already pushed to the max? Who is going to maintain the streets
when the addition traffic requires them to be replaced? And what about the ecological concerns
of a development this large may bring. More development means more stress on the community
as a whole. Once again, I doubt the developers could care less about the impact that
development may have on our community and the quality of life we have worked so hard to
maintain.
Do we want our downtown to become like Saratoga with no foot traffic? The North 40 will do to
our downtown what Westfield Valley Fair and Santana Row has done to downtown San Jose,
devastate and destroy the vitality it once had. The developers do not live and work here. Their
interest is purely in the financ ial prosperity of their company, not our Town.
We have all seen firsthand that our Downtown and its economy is suffering from traffic
congestion., lack of parking, and competition from outside forces who have no interest in us as a
community. The summer weekends of congestion have had a negative effect on businesses, as
well as the overall view of the town residents in regards to their quality of life. The Planning
Commission and Council should be working to promote our Downtown, not voting for a
development that will eliminate and destroy it. Surrounding neighbor hoods and centers along
Los Gatos Boulevard should be included and promoted as well, encouraging residents to buy
and keep our tax dollars local. By focusing the town 's resources and energy on eliminating the
current situations that could be improved, we as a Town can thrive and continue to attract
visitors as well as encourage locals to continue to patronize our local merchants. We can
continue to be seen as a unique and inviting Town , who already has all the needs of our
community meet with the current businesses that are already here . contributing and continuing
to enhance our community and Town
I am against the North 40 development and strongly urge you to vote against this North 40
development proposal.
Linda Matulich
Local Resident & Owner of
Steamer's The Grillhouse
From: Jega A [mailto:ajegam@gmail.com]
sent: Friday, July 08, 2016 9:25AM
To: Planning
Cc: Joel Paulson; Sally Zarnowitz
Subject: North 40 -Project
To: Members of the Los Gatos Planning Commission:
I have lived in Los Gatos over the last 9 years. One of my kid goes to Fisher and the other to Los
Gatos High. All of us are very involved in our community activities. We do several volunteer
work in the school and with Los Gatos Rec .
We really like Los Gatos and are very glad we found a great town for our kids. It looks like all
of this will change w ith North 40. Although I have been following North 40 for a while now--I
really did not understand the full magnitude of the constructions. I attended the last city meeting
on North 40 and then understood the scope of the construction.
We live on Oka Lane and we have seen significant traffic in the last couple of years . Not j ust
from JCC but also from Netflix employees on Lark trying to get on to the highways. Getting
even to Creekside fields now take more than 15 minutes with the new signal.
There are several large projects just around this area-new Netflix building, construction near the
Hospital in Pollard road, proposed construction on Dell Avenue and now North 40. With all this
new constructions how is someone expecting the traffic to still be at acceptable levels (level D?)
. This just is not possible. Please try and get from Oka to Los Gatos Blvd. during the peak hours
and why all the new constructions are happening in one comer of the town?
There may be several reasons that North 40 might get approved but, I cannot see a reason there
that would be in the best interest of the town and its residents . I understand that the city need
money for different purposed but, this is not the way to get it. Other cities have made similar
mistakes(Cupertino?). Let's not do the same.
Thanks
Jega
gold forb 1300 Clay Street, Eleventh Floor
I i p m a n Oakland, California 94612
attorneys 510836-6336
M David Kroot July 7, 2016
Lynn Hutchins BY E-MAIL
Koren M. Tiedemann
Thomas H. Webber
Dionne Jackson Mclean
Michelle D. Brewer
Jennifer K. Bell
Robert C. Mills
Laurel Prevetti, Town Manager
Town of Los Gatos
110 E. Main Street
Los Gatos, CA 95030
Isabel L. Brown Re: Town Review of North Forty Planning Application
James T. Diamond, Jr.
Margaret F. Jung Dear Town Manager Prevetti:
Heather J. Gould
William F. DiCamillo
Amy DeVaudreuil
Barbara E. Kautz
Erica Williams Orcharton
'Luis A. Rodriguez
Rafael Yaqui6n
Celia W. Lee
Dolores Bastian Dalton
Joshua J. Mason
Vincent L. Brown
L. Katrine Shelton
Hana A. Hmdy
Caroline Nasella
Eric S. Phillips
Elizabeth Klueck
Daniel S. Maroon
Justin D. Bigelow
San Francisco
415 788-6336
Los Angeles
213 627-6336
San Diego
619 239-6336
Goldfarb & Lipman LLP
This letter is from Barbara Kautz as well as from attorney Andrew Faber of Berliner
Cohen LLP.
We represent the interests of Grosvenor USA Limited and Summerhill Homes
(collectively, the "Applicants") in relation to Architecture and Site Application S-13-
090 and Vesting Tentative Map M-13-014 (collectively the "Planning Applications")
for 320 residences and 66,000 sq. ft. of neighborhood commercial space located in the
North Forty Specific Plan area. This letter describes the limits placed on the Town of
Los Gatos' review of the Planning Applications, expands on the comments we made at
the Planning Commission's March 30, 2016 public hearing, and responds to issues
raised since that meeting.
In brief, under the Housing Accountability Act and Housing Element law, the Planning
Applications may only be reviewed for conformance with objective Town standards and
policies that existed on the date that the Planning Applications were found to be
complete. The Town must apply those policies to facilitate the proposed density, not to
seek excuses for denying the Planning Applications. Under State Density Bonus Law,
the project is entitled to 320 units. The Town cannot apply any development standard
that would preclude the project from being built at that density.
The Applicants appreciate the staff report's recommendation for approval of the
Planning Applications and the report's acknowledgement that the Planning Applications
are consistent with the "technical" (i.e., objective) requirements of the Specific Plan, the
General's Plan's goals and policies, and the Housing Element. However, the staff report
appears to imply that the Planning Commission, and ultimately the Town Council, may
reduce the density, modify the distribution of the housing units on the site, or otherwise
modify the application to better achieve "the look and feel of Los Gatos." Reduction of
the density or redistribution of the housing units on the site would be inconsistent with
Density Bonus Law, the Housing Accountability Act, and Housing Element Law.
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Laurel Prevetti, Town Manager
Town of Los Gatos
July 7, 2016
Page 2
Similarly, the Town may not require modifications based on subjective standards such
as "the look and feel of Los Gatos." Instead, the Town's role is limited to a careful
review of the Planning Applications to ensure that they comply with the numerous
objective standards contained in the Specific Plan.
A detailed discussion is below.
A. Limits on Scope of Town's Review.
The statutes described below prescribe the limits of the Town's review authority
regarding the Planning Applications.
1. Subdivision Map Act. The Subdivision Map Act provides that, in
reviewing the application for a Vesting Tentative Map, the Town must apply only the
"ordinances, policies, and standards" in effect when the Town determined the
application to be complete. (Gov't Code § 66474.2; see Kaufman & Broad Central
Valley, Inc. v. City ofModesto (1994) 25 Cal.App.4th 1577, 1585-86.)
2. Housing Accountability Act. The Housing Accountability Act (Gov't
Code § 65589.5U)) provides that when a proposed housing development complies with
"applicable, objective general plan and zoning standards and criteria, including design
standards," in effect at the time the application is determined to be complete, the Town
may deny the project or reduce the density only if it makes "written findings supported
by substantial evidence" that both of the following conditions exist:
"(1) The housing development project would have a specific, adverse impact
upon the public health or safety unless the project is disapproved or approved
upon the condition that the project be developed at a lower density. As used in
this paragraph, a "specific, adverse impact" means a significant, quantifiable,
direct, and unavoidable impact, based on objective, identified written public
health or safety standards, policies, or conditions as they existed on the date the
application was deemed complete.
"(2) There is no feasible method to satisfactorily mitigate or avoid the adverse
impact identified pursuant to paragraph (1 ), other than the disapproval of the
housing development project or the approval of the project upon the condition
that it be developed at a lower density." (See Honchariw v. County of Stanislaus
(2011) 200 Cal. App. 4th 1066, 1070 (subsection (j) applies to both market-rate
and affordable housing developments, and nothing in the record supported a
finding that the project did not comply with County codes).)
Subsection (f) of the Housing Accountability Act further requires that the "development
standards, conditions, and policies shall be applied to facilitate and accommodate
I 588\03\1884364.4
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Laurel Prevetti, Town Manager
Town of Los Gatos
July 7, 2016
Page 3
development at the density permitted on the site and proposed by the development."
(emphasis added).
These provisions of the Housing Accountability Act limit the Town's review of the
Planning Applications to the objective standards contained in the General Plan, Specific
Plan, and zoning code. The Town has no written health or safety standards violated by
the project. Once the Planning Applications comply with all objective standards -as
acknowledged in the staff report-no reduction in density may be required, nor may the
Town require changes in the Planning Applications that are not required by the adopted
objective standards.
3. Housing Element Law. Housing Element Action Item HOU-1.7
committed the Town to rezoning 13.5 acres on the North Forty to a minimum density of
20 units per acre to allow 270 units. Because the zoning had not been completed before
the Housing Element was adopted, the zoning was required to provide for "use by right"
as defined in Gov't Code §§ 65583.2(h) and (i). "Use by right" means that the Town
cannot require a use permit or other discretionary approval that would constitute a
"project" for purposes of the California Environmental Quality Act (CEQA). Although
the Town may require design review approval, that review is also not subject to CEQA.
The Town's Housing Element provides that review of residential development
applications on the North Forty will occur "by right" based on the Town's design
guidelines, as required by State law. The Element further states that residential
development on the North Forty will be approved "by right" if it meets "objective"
criteria in the Specific Plan's design guidelines. In particular:
• Page 16 states that the North Forty Specific Plan will rezone the North
Forty with a "minimum" density of 20 units per acre and will "provide
certainty regarding objective criteria in the form of development standards
and design guidelines that would be implemented through 'by right
development' in the consideration of Architecture and Site applications."
• Action item HOU-1.7 states that, after 13.5 acres within the North Forty
are zoned to permit a "minimum" density of 20 units per acre, housing
development will be "by-right as defined by not requiring a conditional use
permit or other discretionary approval; however, design review according
to the objective standards contained in the Specific Plan can occur."
(emphasis added).
Like the Housing Accountability Act, these Housing Element and State law
provisions limit the Town's review of the Planning Applications to the objective
standards contained in the various plans and do not allow the Planning Applications to
be evaluated under subjective standards. The Housing Element also requires that at
least 270 units be permitted at a density of at least 20 units per acre.
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Laurel Prevetti, Town Manager
Town of Los Gatos
July 7, 2016
Page 4
4. Density Bonus Law. The Planning Applications are eligible for a 35%
density bonus, increasing the density from 237 units to 320 units, because the project
contains over 20% very low income housing (Gov't Code § 65915(f)(2)). Density
Bonus Law (Gov't Code § 65915) contains no grounds on which a request for a density
bonus may be denied. (See Gov't Code§ 65915(b); Friends of Lagoon Valley v. City of
Vacaville (2007) 154 Cal. App. 4th 807, 825 ("If a developer agrees to dedicate a certain
percentage of the overall units in a development to affordable or senior housing, the
Density Bonus Law requires the municipality to grant the developer a density bonus."
(emphasis added)).
The density bonus must be granted by the Town. Any provisions of the Los Gatos
Town Code allowing denial of the bonus are inconsistent with State law and cannot be
used to deny the bonus.
Nor may the Town seek to reduce the density by applying other development standards.
"In no case may a city ... apply any development standard that will have the effect of
physically precluding the construction of a development... at the densities ... permitted
by this section." (Gov't Code§ 65915(e)(l).) If development standards must be waived
to allow construction of 320 units, the Town is required to do so. (See letter of
March 25, 2016 from Barbara Kautz.) If a court finds that a refusal to grant a density
bonus, incentive, concession, or waiver violated Density Bonus Law, it shall award the
plaintiff reasonable attorneys' fees. (Gov't Code§§ 65915(d)(3) and (e)(l).)
5. SB 50 and Fair Housing Law. The majority of the correspondence to
the Town has cited school impacts and a desire to relocate children to the Cambrian
School District as a primary reason to relocate housing to the Northern District. SB 50
does not allow the Town to establish conditions of approval based on school impacts,
nor do federal and state fair housing laws allow the Town to take actions to prevent
children from residing in Phase One by relocating homes to the Northern District.
SB 50. If a developer agrees to pay the fees established by the Leroy
F. Greene School Facilities Act of 1998 (SB 50), the impacts on school facilities may
not be analyzed under the California Environmental Quality Act, no mitigation for
impacts on school facilities may be required, and the project may not be denied or
conditioned due to impacts on schools or due to the inadequacy of school facilities.
(Gov't Code § 65995(i).) Payment of school fees is the exclusive method to mitigate
impacts on schools and is deemed to provide full and complete mitigation of impacts.
(Gov't Code §§ 65996(a) and (b).) The Applicants have agreed to pay school fees and
have voluntarily entered into an agreement to pay additional amounts to the Los Gatos
Union School District. The Town may not impose any additional conditions -
including relocation of units to the Northern District --to reduce school impacts.
I 588\03\1884364.4
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Laurel Prevetti, Town Manager
Town of Los Gatos
July 7, 2016
Page 5
Fair Housing Issues. As documented in Barbara Kautz' memo of
February 12, 2015, our May 27, 2015 joint letter, and additional evidence attached to
this e-mail, throughout the hearings on the North Forty Specific Plan there have been
extensive public comments and statements by decision-makers indicating that the Town
wishes to discourage families with children from residing in the North Forty, especially
within the boundaries of the Los Gatos elementary and high school districts.
Federal and state law forbid local governments from enacting or enforcing land-use
laws that discriminate based on familial status (42 USC § 3604(b)), interfere with an
owner's efforts to make housing available to families ( 42 USC § 3617), or impose
different requirements on residential developments because of familial status. (Gov't
Code § 65008(d)(2); see also Gov't Code § 12955(1).) Outwardly neutral actions by a
city that are motivated by an intent to discriminate violate fair housing laws. (See
Avenue 6E Investments LLC v. City of Yuma, 2016 U.S. App. Lexis 5601 (9th Cir.
2016); Pacific Shores Properties LLC v. City of Newport Beach, 746 F.3d 936 (9th Cir.
2014).) A court does not need to find this was the sole reason that the Town adopted a
policy, only that this was the more likely motivation. (Harris v. Itzhaki, 183 F.3d 1043,
1051 (9th Cir. 1999); see also Gov't Code§ 12955.8(a).)
This history of animus toward children and especially to children who would attend
schools in the two Los Gatos districts is likely a substantial motivation for any attempt
to relocate the housing to the Northern District, in violation of fair housing laws.
B. Implications for Review of Planning Applications.
The statutes discussed above confine the Town's review of the Planning Applications to
the objective standards contained in the General Plan, Specific Plan, and zoning
ordinance. As a consequence, Phase One is entitled to the 320 units requested;
conditions cannot be imposed on the project unless they are required by objective
standards and policies, and the Town cannot use subjective criteria and findings to
condition or deny the Planning Applications. In particular:
1. The Town Cannot Reduce the Density of Phase One.
Density Bonus Law requires the Town to grant the density bonus and approve the 320
units the project is entitled to. Density Bonus Law contains no grounds on which a
density bonus may be denied.
2. The Town Cannot Require Units to be Redistributed or Relocated to
the Northern District
The staff report suggests that the Planning Commission has discretion to modify the
distribution of units within North Forty Specific Plan area, either by moving some units
1588\03\1884364.4
7/6/2016
Laurel Prevetti, Town Manager
Town of Los Gatos
July 7, 2016
Page 6
to the Northern District or otherwise redistributing them throughout the North Forty.
Neither of these requirements can be imposed on the Planning Applications because: (a)
they were not in effect when the Planning Applications were deemed complete; (b) they
would be inconsistent with both the adopted Specific Plan and the Housing Element;
and (c) requiring these changes would violate Density Bonus Law, the Housing
Accountability Act, and Housing Element law.
a. The Town Cannot Require the Units to be Relocated Because No
Town Policy Requires Relocation. The Housing Element states that the Planning
Applications will be reviewed based on objective policies in the Specific Plan. The
Housing Accountability Act requires that the Planning Applications be reviewed based
on objective General Plan, zoning, and design review standards. Not one of these Town
documents limits the size of Phase One on the North Forty or requires that the housing
be distributed evenly across the site. In consequence, the Town cannot reduce the
density of Phase One based on a desire to distribute the housing evenly on the site or to
move more housing to the Northern District. In any case, Density Bonus Law requires
the Town to allow 320 units in Phase One; the density cannot be reduced so units can be
moved to the Northern District, which is not part of the Planning Applications.
b. Relocation of Units Would be Inconsistent with the Housing
Element. The density of 20 units per acre promised in the Housing Element cannot be
obtained in the Northern District. With residential uses required to be located over
commercial and a 35-foot height limit (reduced further to 25 feet within 50 feet of Los
Gatos Blvd.), only one-story residences are possible on top of the required commercial
uses. The letter from the Applicants submitted concurrently with this letter
demonstrates that the required density of 20 units per acre is not reached even with
small units.
c. Relocation of Units Would be Inconsistent with the Specific Plan.
It is clear from the Specific Plan that the 270 units of housing at 20 units per acre
promised in the Housing Element were intended to be located primarily in the Lark
District and secondarily in the Transition District. The Lark District is intended for
residential and "limited" retail/office uses. The Transition District is intended as a
transition and buffer between the "primarily residential" Lark District and the "active
retail and entertainment emphasis" of the Northern District. By contrast, the Northern
District is described as a "day-to-evening entertainment area that offers shopping and
restaurants for nearby residents as well as employment centers" and allows only limited
residential over commercial.
Plainly the most housing was intended to be built in the Lark District and the least
amount of housing was anticipated to be built in the Northern District. A policy to
distribute housing evenly across the site is not consistent with the adopted Specific Plan.
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Laurel Prevetti, Town Manager
Town of Los Gatos
July 7, 2016
Page 7
3. Subjective Standards Cannot Be Used to Evaluate the Planning
Applications.
The staff report states that the Planning Commission has the discretion to consider the
"overall Vision and Guiding Principles" contained in the Specific Plan in making a
decision on the Planning Applications.
The Vision and Guiding Principles are not objective standards by which the Planning
Applications may be evaluated. Rather, in developing the plan, the Town translated the
Vision and Guiding Principles into the objective standards required to meet the Town's
commitments in its Housing Element. The objective criteria contained in the Specific
Plan (number of units, building height, setbacks, etc.) reflect the Town's judgment
regarding what development on the North Forty is consistent with the Vision and
Guiding Principles. As an example, the Guiding Principle regarding the "look and feel
of Los Gatos" was translated into detailed policies for perimeter setbacks and
landscaping contained in Table 2-5 and into detailed specifications for cottage and
garden clusters contained in Table 2-7; for townhomes and row houses in Table 2-8; and
for affordable homes in Table 2-9. The Town's consulting architect concluded that, by
conforming to these standards, the overall development obtained "the look and feel of
Los Gatos."
However, the Vision and Guiding Principles in and of themselves are not objective, and
by themselves, divorced from the objective standards, they may not be used to evaluate
the Planning Applications. All are subjective criteria that cannot be the basis for a
decision on the project. Because the Planning Applications comply with the objective
standards contained in the Specific Plan, they are by necessity consistent with the
Vision and Guiding Principles.
****
Summary. The State law provisiOns discussed above require that the Planning
Applications may only be reviewed for conformance with existing objective Town
policies, which must be applied to facilitate development of 320 units. The Town may
not reduce density, require project phasing, relocate units to other sites on the North
Forty, place units in other school districts, reduce heights, or impose any other
requirement not already contained in the adopted development standards. Nor can the
Planning Applications be denied based on subjective standards, such as those contained
in the Vision and Guiding Principles.
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Laurel Prevetti, Town Manager
Town of Los Gatos
July 7, 2016
Page 8
Instead, the Town's role is to review the confonnance of the Planning Applications with
the numerous objective design guidelines, landscape requirements, circulation and
infrastructure standards, and other objective requirements contained in the Specific
Plan. All of the review completed to date, including review by the Town's consulting
architect, has concluded that the Planning Applications are consistent with the
"applicable, objective general plan and zoning standards and criteria, including des ig n
standards 11 in effect when the P lanning Applications were found to be complete.
The Applicants have worked cooperatively with the Town since 2010, for the over five
years that the North Forty Specific Plan was under consideration. On May 5, 2015 the
Town adopted a Housing Element designating the North Forty for 270 units at 20 units
per acre, and in June 2015 the Town adopted a Specific Plan containing detailed design
guidelines, development regulations, and mitigation requirements. The North Forty was
adopted as a Housing Element site specifically because the Specific Plan placed so
many requirements on a residential project to ensure high quality and because the
Applicants had agreed to extensive voluntary mitigation measures, such as additional
funds for the Los Gatos Union School District. The Applicants now simply seek to
develop the project envisioned by the Specific Plan, which will be an asset to the Town.
However, in the event that the Town denies the Planning Applications or approves them
with conditions that violate the legal framework described above, the Applicants intend
to fully enforce their legal rights and remedies.
If you have any questions, please feel free to contact us.
Sincerely,
G c;p:~LLP /~ ( --
BARBARAE.KAUTZ .
bkautz@goldfarblipman.com
andrew.faber@berliner.com
I 588\03\1919557.1
7/612016
Laurel Prevetti, Town Manager
Town of Los Gatos
July 7, 2016
Page 9
cc: Don Capobres, Grosvenor USA Limited
Wendi Baker, Summerhill Homes
Andy Faber, Berliner Cohen LLP
Rob Schultz, Town Attorney
Joel Paulson, Community Development Director
I 588\03\1884364.4
7/6/2016
ADDITIONAL STATEMENTS AND POLICIES REGARDING DESIRE TO EXCLUDE
FAMILIES WITH CHILDREN
A. Until final revisions were made to the Specific Plan on June 17, 2015, it contained explicit
statements showing animus against families with children (see attached final revisions dated
June 17, 2015). Among these were:
1. Section 2. 7.1: "Residential product types (market rate and affordable) shall be limited to
product types that respond to emerging demands of the seniors, empty nesters, and
young adult demographics" -all demographics unlikely to have children.
2. Policy 18 stated explicitly that the purpose of these limitations was to discourage school-
aged children from residing in the North Forty: "Minimize impacts to schools by
designing housing products that cater to senior, empty nester, and young adult
demographics."
3. Appendix C was entitled "Young Adult, Senior, and Empty Nester Design Summary." It
asked, "How does design attract Gen Y and Baby Boomers instead of families?" and
suggested nightlife instead of schools and parks, stacked flats ("not good for families
because of noise issues"), and elevators rather than direct access to yards.
Removing these provisions from the Specific Plan at the last minute does not correct the animus
against school children that has tainted the project review throughout.
B. The Specific Plan continues to have a "Young Adult, Senior, and Empty Nester"
summary indicating a desire not to attract persons between 32 and 48 years of age -a
demographic most likely to have school-age children. Policy LU10 continues to provide for a
mix of residential types "designed to minimize impacts on schools." At the March 30 hearing
regarding the Planning Applications and in extensive correspondence submitted to the Town,
most members of the public suggest that housing should be relocated to the Northern District so
that fewer children will attend schools in the Los Gatos Union School District and the Los Gatos-
Saratoga Joint High School District. At the joint Commission-Council study session held on June
15, 2016, Town staff stated that the Town already has "a lot of family housing" and that
designing for senior and youth housing is "an indirect way to get to the school issue" -again
demonstrating the Town's intent to keep school-aged children out of the North Forty, especially
Phase One.
~
EDEN
HOUSING GROSVENOR
February 13, 2015
Town of Los Gatos
Honorable Mayor Jensen and Council Members
Housing Element Advisory Board
: . --. ·--·"· .. ,_ --. -. -· ·-. . -· .. ,. ---. -~
:SUMMERHILL HOMES'" I
:._, _______ ,_,·--···---------··----______ j
CO/v\MUNITII:S 01' DISTINCTION
c/o Laurel Prevetti, Assistant Town Manager and Community Development Director
110 E. Main St.
Los Gatos, California 95031
Honorable Mayor Jensen, Council Members, and Housing Element Advisory Board Members:
At the February 3rd, 2015 Town Council Meeting, Council sought direction from Staff and the
Town Attorney to determine what the legal limitations may be for requiring developers on the
North 40 to provide for either an age 55-plus or 62-plus affordable or market rate component
through the North 40 Specific Plan.
This question has arisen on numerous occasions during the Specific Plan process. For our own
clarity, we requested a legal analysis from Goldfarb & Lipman. We have attached their
conclusions for your reference. In brief, while senior housing can be incentivized by a Specific
Plan, requiring such housing types would violate state and federal fair housing laws ..
Although the Town's Specific Plan is still in process, after years of observation and discussion
with the Town, we respect that the Specific Plan emphasizes residential design towards the
Town's unmet housing needs, including places for senior to live. We embrace the Town's vision
in the Specific Plan which allows for the provision of a multi-generational and mixed income
neighborhood. We are anxious to continue working with the Town to implement this vision.
We appreciate your consideration of the attached letter, and are available for any questions
regarding this matter.
Sincerely,
A. Don Capobres
Senior Vice President
Grosvenor
Attachment: Fair Housing Issues Memo
Linda Mandolini
President
Eden Housing
\
Wendi Baker
Vice President of Development
SummerHill Homes
9 0 I d far b 1300 Clay Street, Eleventh Floor
I i p m a n Oakland, California 94612
at to r n e y s s1 o 836-6336
M David Kroot February 12, 2015
Lynn Hutchins
Karen M. Tiedemann
Thomas H. Webber
Dianne Jackson Mclean
Michelle D. Brewer
Jennifer K. Bell
Robert C. Mills
Isabel L. Brown
James T. Diamond, Jr.
Margaret F. Jung
Heather J. Gould
Juliet E. Cox
William F. DiCamillo
Amy DeVaudreuil
Barbara E. Kautz
Erica Williams Orcharton
Luis A. Rodriguez
Xochitl Carrion
Rafael Yaquian
Celia W. Lee
Vincent L. Brown
Hana A. Hardy
Caroline Nasella
Eric S. Phillips
Elizabeth Klueck
San F~rancisco
415 788-6336
Los Angeles
213 627-6336
San Diego
To
Don Capobres, Grosvenor Americas
Wendi Baker, SummerHill Homes
From
Barbara E. Kautz
Fair Housing Issues Regarding Planning and Families with Children
Summary
During hearings on the North Forty Specific Plan, public comments have been
made opposing the Town of Los Gatos' (the "Town") approval of housing that
may attract families with school-age children because of school overcrowding. In
particular, proposals have been made that development on the site be limited to
senior housing or to other housing that will not accommodate families with
school-age children.
Both federal and state law prohibit the Town from using its planning and zoning
powers to deny residency to, or make housing unavailable to, or discriminate
against, families with children. Planning or zoning restrictions that are adopted to
discourage families with children from living in the Town, or that prevent
families with children from living in the Town, such as zoning sites to permit
only senior housing or limiting the number of bedrooms in residences, would
deny residency to, make housing unavailable to, and discriminate against
families with children.
Further, a property owner or manager may not select individual tenants or buyers
on the basis of age unless the housing is designed as senior housing and the
property is operated consistent with federal and state requirements for senior
housing.
Analysis
A. Zoning for Senior Housing
619 239-6336 Federal and state statutes forbid the Town from enacting or enforcing land-use
Goldfarb & Lipman LLP laws that operate to make housing "unavailable" based on "familial status.".
1588\03\1565758.4
February 12, 2015
Page 2
"Familial status" is generally defined as a household containing a person under
18 years of age residing with a parent or guardian. (Gov't Code§ 12955.2.)
In particular:
• The federal Fair Housing Act ("FHA") (42 U.S.C. § 3604(a)) forbids
actions by cities that operate to make housing "unavailable" based on
familial status [and other listed factors].
• The California Fair Employment and Housing Act ("FEHA") (Gov't Code
§ 12955(l)) prohibits discrimination through land use practices that make
housing opportunities "unavailable" because of familial status.
• Planning and Zoning Law (Gov't Code § 65008(a)(1)) invalidates any
planning action if it denies the enjoyment of residence to any persons
because of familial status, age, [or other factors]. Section 65008(b )( 1)
forbids cities from prohibiting or discriminating against any residential
development because of familial status or age.
Town zoning and planning actions taken for the purpose of discouraging the
construction of housing for families with children would violate these federal and
state fair housing laws. Similarly, planning and zoning actions that on their face
prevent occupancy of housing by families with children -even if done without
the intent to exclude families with children -would violate federal and state fair
housing laws. Examples could include allowing only senior housing to be built
on designated sites or limiting the number of bedrooms in homes.
The Senior Housing Exception.
All of the fair housing statutes contain exceptions for senior housing constructed
and designed in conformance with Civ. Code §§ 51.2 -51.4 and similar
provisions of federal law. These sections allow discrimination based on age and
familial status by a "business establishment" ~f the housing is built and designed
to serve seniors. The California Legislature made some of the requirements for
senior housing in California more stringent than those imposed by the Fair
Housing Act "in recognition of the acute shortage of housing for families with
children in California." (Civ. Code § 51.4(a).) A developer may propose, and the
Town may approve, a development proposed by a developer for senior housing
but the Town cannot require senior housing to be constructed or designate a site
for senior housing when there is no proposal or intent by a "business
establishment" to construct such housing. There is no exception to this rule for
affordable senior housing.
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February 12, 2015
Page 3
As discussed further in the next section, senior housing in compliance with these
provisions must either require all residents to be 62 years of age or older; or
comply with more stringent design standards and require at least one member of
each household to be 55 years of age or older. Housing otherwise cannot have
age limits or be limited to 'adults only,' and managers and brokers cannot
consider age or familial status in selecting tenants and buyers.
Zoning for Senior Housing. Local agency efforts to require housing to be built or
even maintained for seniors have usually been overturned by the courts. For
example:
• Despite an exemption in State law to allow Riverside County to maintain
long-standing senior housing zones, these were found to violate the Fair
Housing Act because the County did not ensure that the housing within
these zones actually complied with the statutory requirements. (Gibson v.
County of Riverside, 181 F. Supp. 2d 1057 (C.D. Cal. 2002).) Note also
that the specific exemption in State law for Riverside County's zoning
suggests that similar zoning by other cities and counties would violate
state fair housing laws.
• An ordinance adopted by American Canyon to require a mobilehome
park approved as a senior park to maintain its senior status, rather than
convert to an all-age park, was found to violate the Fair Housing Act
because the park had never, in fact, actually been operated as a senior
park in compliance with state and federal law. (Waterhouse v. Town of
American Canyon, 2011 U.S. Dist. Lexis 60065 (N.D. Cal. 2011).)
• A mobilehome park owner who alleged that the City of Fillmore adopted
invalid subdivision conditions for the purpose of preventing the park
from converting from a senior park to an all-age park was found to have
standing to sue the City under the Fair Housing Act. (El Dorado Estates
v. City of Fillmore, 765 F.3d 1118 (9th Cir. 2014).
One ordinance was upheld. The Town of Yucaipa was found to be in compliance
with the Fair Housing Act when it adopted zoning prohibiting existing senior
mobilehome parks, which in fact were being operated as senior parks, from
converting to all-age parks. (Putnam Family Partnership v. Town o.f Yucaipa,
673 F.3d 920 (9th Cir. 2012).)
The decision was confined to the situation where the parks were already
operating as senior housing. The Court specifically declined to determine if its
decision would be the same if the housing was not already serving seniors. (!d. at
927 n.3) The decision was also based on federal law alone and did not consider
possible violations of State Planning and Zoning law or FEHA. State law does
1588\03\1565758.4
February 12, 2015
Page4
not have the same language which was relied upon by the Court to uphold
Yucaipa's ordinance.
The Court also noted that the federal statute included a policy of "preserving"
senior housing and that Yucaipa's intent appeared to be to preserve existing
senior housing "rather than animus against families with children." (!d. at 931.)
By contrast, in Los Gatos, there has been extensive public comment, testimony
from the School District, and statements by decision-makers indicating that the
Town wishes to discourage families with children from residing in the North
Forty because of school overcrowding. An early draft of the North Forty Specific
Plan stated specifically that, "Residential product types (market rate and
affordable) shall be limited to product types that respond to emerging demands of
the seniors, empty nesters, and young adult demographics"-all groups unlikely
to have children.1 If the Town of Los Gatos were to require senior housing on the
North Forty or to adopt other Specific Plan provisions to prevent or discourage
households with children from moving to the North Forty, the record contains
substantial evidence of "animus" against households with children.
Incentives for Senior Housing. State and federal laws recognize that there is a
need for senior housing and provide funding and incentives to encourage senior
housing. For instance, State density bonus law permits all senior housing to
receive a 20 percent density bonus whether or not it is affordable. (Gov't Code §
65915(b)(1)(C), (f)(3).) There does not appear to be a violation of fair housing
laws if zoning incentives are provided for senior housing, in recognition of its
unique characteristics: lower automobile use, less traffic, smaller household size
(rarely more than two persons/household). Other incentives typically provided
may be lower parking requirements and reduced traffic impact fees. A recent
case recognized that there is a statewide priority to develop senior housing, and,
when a developer proposed a senior project, the city's zoning of the site for
higher density was not illegal spot zoning. (Foothill Communities Coalition v.
County of Orange (2014) 222 Cal. App. 4th 1302.)
However, if there is evidence that these incentives were adopted with the intent
of excluding housing for families with children, the zoning may be found to be
invalid. (C..f Pac~fic Shores Properties LLC v. City of Newport Beach, 746 F.3d
936 (9th Cir. 2014; writ of certiorari denied, 135 S. Ct. 436 (2014)) (holding that
facially neutral ordinance invalid where adopted with discriminatory intent).
1 HUD's Fair Housing newsletter featured a case filed against the Village of Bronxville, N.Y. challenging
a Village ordinance that requires developers to demonstrate that the design of residences is intended to
appeal primarily to singles and to couples without children -a provision similar to the original provisions
proposed in the Specific Plan .. (Westchester Residential Opportunities Inc. v. Village of Bronxville
(S.D.N. Y. Case No. 15 CV 00280) (filed January 15, 2015).
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February 12, 2015
Page 5
Conclusion.
Los Gatos cannot adopt Specific Plan provisions for the North Forty that exclude
or discourage families with children, such as by requiring the development of
senior housing or by zoning a portion of the site for senior housing only. While
the Town can provide incentives for senior housing in view of its unique
development characteristics, the incentives could be found to be invalid if they
are adopted with the intent to exclude families with children.
B. Selection of Buyers and Renters Based on Age
The Town has asked if the Specific Plan could require developers to reserve
some portion of the residences on the North Forty for seniors. Only housing that
qualifies as a senior development under both state and federal law may
discriminate based on age and familial status (42 USC § 3607(b)(l)-(3); Civ.
Code § 51.2(a)). Developers cannot choose to reserve a portion of the units in a
non-senior project for seniors, nor can local government require them to do so
Both the federal Fair Housing Act and California's Unruh Act contain standards
specifying whether a development qualifies as "housing for older persons" and
may discriminate based on age and familial status. Reading the two Acts
together, they allow the following types of senior housing:
• Housing provided under a state or federal program that HUD recognizes
as intended for elderly persons (42 USC § 3607(b)(2)(A)); Civ. Code §
51.2(e));
• Housing with fewer than 35 units occupied solely by persons 62 years of
age or older (42 USC§ 3607(b)(2)(B); Civ. Code§ 51.2); and
• Housing with 35 units or more either occupied solely by persons 62 years
of age or more; or occupied by households where at least one occupant is
55 years or older (42 USC§ 3607(b)(2)(C); Civ. Code§ 51.2-51.3).
All new senior housing must include certain design features and have rules and
covenants clearly restricting occupancy consistent with the federal and state
occupancy requirements. Further, the policies, procedures, and marketing must
demonstrate that the project as a whole is intended for seniors. (54 Fed. Reg.
3255 (Jan. 23, 1989).) Mixed-income developments are only possible if separate
buildings are constructed for each income group.
If a development is not designed as senior housing, the owner or manager cannot
use age or familial status as a criterion in deciding whether to sell or rent a home.
1588\03\1565758.4
February 12, 2015
Page 6
Conclusion
Requiring developers of non-senior housing to reserve a percentage of the units
for seniors would violate state and federal housing laws.
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Los Gatos Town Council
May 27,2015
Provisions Regarding Schools
The Revised Draft Specific Plan has added two policies related to schools. Policy 19
provides that "Developers are encouraged to collaborate with School Districts to address school
needs." Policy I 10 states that:
"Developers shall work closely with School Districts to project enrollment growth and
address overcrowding by assisting with identifying strategies for providing needed school
facilities and associated sources of funding." (emphasis added)
The Leroy F. Green School Facilities Act of 1998 ("SB 50") strictly limits the
requirements that local agencies may place on developers in relation to school overcrowding. In
particular, SB 50 provides:
"A state or local agency may not deny or refuse to approve a legislative or
adjudicative act, or both, involving, but not limited to, the planning, use, or
development of real property, or any change in governmental organization or
reorganization as defined in Section 56021 or 56073 on the basis of a person's
refusal to provide school facilities mitigation that exceeds the amounts authorized
pursuant to this section or pursuant to Section 65995.5 or 65995.7, as applicable."
(Gov't Code § 65995(i).)
In addition, payment of fees "shall be the exclusive method[] of considering and
mitigating impacts on school facilities," and "are ... deemed to provide full and complete school
facilities mitigation." (Gov't Code§§ 65996 (a) and (b).) In other words, school impact fees
constitute adequate mitigation of school impacts, and a local agency cmmot deny a project
because the developer has not taken actions to address overcrowding in addition to payment of
school fees.
Policies 19 and I I 0 are inconsistent with SB 50. Both require developers to take actions to
address overcrowding in addition to payment of school impact fees. This is especially ironic
given the various provisions intended to reduce student generation to one-third of that expected
from single-family homes, and the Specific Plan's statement that the number of students
anticipated is "minimal." (p. 5-15, Revised Draft.) We request that these policies be removed
fi:om the Plan.
Public Open Space Requirements
With regm·d to requiring all open space to be accessible to the public, there was discussion at
the April14, 2015 Council meeting of possibly not counting certain hm-dscapes, podium green space,
or areas not open to the public as open space. If these restrictions are adopted, then in our clients'
opinion, it will not be feasible to develop a project consistent with the Specific Plan and with a
density and an affordable component that satisfies the Town's Housing Element.
In addition, any requirement that all open space areas must be accessible to the public would
amount to an unconstitutional taking of private property, in violation of the Just Compensation
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Los Gatos Town Council
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Clause of the United States and California Constitutions, as well as well-stablished federal and state
Supreme Court decisions. See Dolan v. City (~[Tigard (1994) 512 U.S. 374; Nollan v. California
Coastal Commission (1987) 483 U.S. 825; Ehrlich v. City ofCulver City (1996) 12 Cal. 4th 854.
A requirement for provision of public open space cannot be justified unless it is needed to
mitigate the impacts of private development. The standard of the Noll an, Dolan, and Ehrlich cases
requires that there be an essential nexus to the impacts of the project, and that the requirement be
roughly proportional to those impacts.
However, this nexus requirement is not satisfied in the North 40 Specific Plan. There is no
impact on public open space due to the passage of the North 40 Specific Plan or the planned
development on the Plan Area. The EIR identifies no such impact, and the Town has no ordinance
requiring public open space in new developments, since there is already abundant public open space
in the Town, including near to the Plan Area. Furthermore, in fact there will be extensive open space
available to the public under the proposed plan and development, including landscaped setbacks, the
orchard land required to be preserved, plazas, paseos, and trails and walkways. Requiring that all
designed open space areas be open to the public would thus be unlawful.
Private Open Space Size Limitations
The May 2014 hearing draft and the Revised Draft of the North 40 Specific Plan propose in
Section 2.7.2 to limit the amount of private open space per unit to 200 square feet-the approximate
size of a one-car parking space - a space too small for usual outdoor activities such as hosting
friends or family for a barbecue and outdoor dining.
The stated purpose of this limitation is to "encourage the residential product types targeted in
the plan area," which "shall be limited" to housing that serves "seniors, empty nesters, and young
adult demographics." (Section 2.7.1.) Policy 18 of the North 40 Specific Plan makes clear that this
requirement is intended to discourage families with school-age children from living in the North 40.
(p. 5-1.) The January 2013 Administrative Draft included even more explicit language, specifying
that open space was to be provided to support "adult" lifestyles while discouraging families with
children from living in the North Forty. (pp. 2-10,2-12,3-19, 3-20.)
Federal and state law forbid local governments from enacting or enforcing land-use laws that
discriminate based on familial status (42 USC§ 3604(b)), interfere with an owner's efforts to make
housing available to families ( 42 USC § 3617), or impose different requirements on residential
developments because of familial status (Gov't Code § 65008(d)(2); see also Gov't Code §
12955(1).) While a limitation on private open space may seem neutral on its face, outwardly neutral
actions by a city that are motivated by an intent to discriminate violate fair housing laws. (See
Budnick v. Town ofCare.fi·ee, 518 F.3d 1109 (9th Cir. 2008).) A court does not need to find this was
the sole reason that the Town adopted a limitation on private open space, only that this was the more
likely motivation. (Harris v. ltzhaki, 183 F.3d 1043, l 051 (9th Cir. 1999); see also Gov't Code §
12955.8(a).)
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Los Gatos Town Council
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Because the limitation on private open space is specifically intended to discourage families
with children from living in the North 40, we request that this limitation be removed from the North
40 Specific Plan.
* * * *
We recognize that what is in front of the Town is the North Forty Specific Plan and not our
clients' development project. However, the fact that the Town is considering a Specific Plan, and
not giving entitlements to an actual project, does not change in any way the applicable standards for
approval. Since a project will have to comply with the Specific Plan, if the Town puts invalid and
unconstitutional requirements into the Plan, then in effect, the Town is saying that it will impose
such improper requirements on the ensuing project as well.
ALF:cem
cc: Rob Schultz, Esq.
Laurel Prevetti
Wendi Baker, SummerHill
Don Capohres, Grosvenor
4812-6743-0436v6
ALF\09427065
Very truly yours,
BERLINER COHEN, LLP
~~~tl;{-f2L0 {JV' !(Jt-t
ANDREW L. FABER
E-Mail: andrew.faber@berliner.com
GOLDFARB & LIPMAN LLP
B tt~?tw~ !Lrwty / Jb{
BARBARA KAUTZ
E-Mail: bkautz@goldfarblipman.com
[u]
• • • • • •
July 8, 2016
Joel Paulson
Town of Los Gatos Planning Department
110 E. Main St.
Los Gatos, California 95031
Re: Response to Questions Raised at March 30, 2016 Planning Commission Study Session and
June 15, 2016 Joint Study Session - North Forty
Dear Joel:
In preparing our application for Phase One of the North Forty, we have designed a project that
conforms with all objective standards established in the North Forty Specific Plan. The Town’s
Housing Element (Actions HOU-1.7, HOU-2.2 and HOU-2.4) states that it will review a project on
the North Forty based only on these objective criteria, and State law (Government Code Section
65589.5(j)) requires the same. If the project conforms to the objective standards in the Plan, it
must be approved by the Town.
At the March 30th 2016 Planning Commission Study Session, several questions were raised
regarding the design and site planning of our proposed North Forty application. Because our
application conforms to the Plan, these changes cannot be required by the Town. (Please see
letter submitted and dated July 8, 2016 from Barbara Kautz – Goldfarb Lipman and Andrew
Faber – Berliner Cohen.) Nonetheless, we have seriously considered the suggested changes and
have responded to the questions raised, as discussed below.
Question 1: Why can’t the units specified in the Town’s North 40 Specific Plan as “Cottage
Cluster” or single family detached be utilized in the project application?
Discussion: The Specific Plan is “focused on multi-family housing types.” (Section 2.4, Page 2-6.)
Single family detached homes are expressly prohibited in the Specific Plan except for “cottage
cluster” residential units, in the Lark District only, and only with the approval of a Conditional
Use Permit. Given the standards contained in the Specific Plan (Section 2.7.3.e, Page 2-26; page
6-10; and required setbacks), which require that cottage housing be designed as a collection of
small houses arranged around a common green space with consolidated parking, the maximum
density that can be achieved is approximately 12-13 units per acre. (See attached 1-Acre
“Cottage Cluster Study”). The North 40 is included in the Town’s Housing Element, which
1588\03\1919806.1
requires by-right development at a minimum density of 20 units/acre. This required density
cannot be achieved on the site if cottage clusters are included.
Question 2: Why can’t the application propose basements, rather than 3rd stories, to achieve
the density required by the Housing Element?
Discussion: No policies in the Specific Plan require basements or suggest that basement units
would be desirable. Units with substantial living space contained in basements are much less
livable, with a large amount of the space effectively underground and with little access to light.
Basements are typically utilized for supplemental space rather than primary living space.
Additionally:
• Light wells with associated railings would penetrate into the pedestrian paseos and
sides of buildings, with approximately 35 square feet of open space per unit lost, for a
total of 10,480 square feet of open space in the paseos for light wells. (See attached
“Lark District and Transition District Area D Basement Study”.)
• Dirt off haul would extensively increase. The addition of basements results in
approximately 40,000 cubic yards of basement off haul, creating 3,350 truckloads of dirt
that would need to be removed from the property. Because basement living space was
not considered when the Specific Plan was adopted, any potential additional impacts of
basement construction were not evaluated in the EIR.
For all of these reasons, replacing a third story with basements is not a feasible alternative.
Please see attached “Lark District and Transition District Area D Site Plan Basement and
Lightwell Areas” and “Basement Study – Total Dirt Off Haul for Basements”.
Question 3: Why can’t the units be spread out into the Northern District?
Discussion: The applicants do not own area within the Northern District, and therefore the
application is for the property within their control. However, the Northern District is described
as a "day-to-evening entertainment area that offers shopping and restaurants for nearby
residents as well as employment centers" and allows only limited residential over commercial.
(Specific Plan 2.3.3, page 2-4.) Building heights cannot exceed 35 feet. (Specific Plan 2.5.2(a),
page 2-11). A study is attached that represents a “perfect” 2.37 acre parcel that accounts for
the Specific Plan requirements, including retail and residential parking, 30% open space, 50%
maximum building coverage per application, and a 35’ height limit. As this exhibit shows, even
with 1-bedroom apartments at 750 square feet, a density of approximately 14 units per acre
can be achieved, below the required minimum density of 20 units per acre. Please see attached
exhibit, “Single Level of Housing above Commercial Density Study”.
In conclusion, we have considered carefully these specific suggestions for amendments to our
project design and have concluded that they are not feasible. They cannot be imposed on the
project because none of these changes are required by the Specific Plan. As described in the
1588\03\1919806.1
attached Project Summary, the proposed community is a celebration of the Los Gatos quality of
life that will be an asset to the community.
Sincerely,
A. Don Capobres Linda Mandolini Wendi Baker
Principal President Vice President of Development
Harmonie Park Development Eden Housing SummerHill Homes