Attachment 21Buchalter
March 20, 2018
VIA E-MAIL & FEDEX
Mayor Rennie and Members of Town Council
Town of Los Gatos
110 E. Main Street
Los Gatos , CA 95031
55 Second Street
Suite 1700
San Francisco , CA 94105
415 .227 .0900 Phone
415.227.0770 Fa x
File Number: L4342 -0002
415.227 .3508 Direct
aguerra@buchalter.com
Re: Appeal of Planning Commission Decision Denying a Request to Demolish Three
Existing Office Buildings and Construct a New, Two-Story Office Building with
Underground Parking for 401-409 Alberto Way Project
Architecture and Site Application S-15-056
Conditional Use Permit Application U-15-009
APN 529-23-018
Honorable Mayor Rennie and Members of the Town Council,
Thank you for considering the appeal we filed on February 23 , 2018 (the "Appeal ") on
behalf of our client, LP Acquisitions , LLC (the "Appellant" or "Applicant"), regarding the
above-referenced project located at 401-409 Alberto Way in Los Gatos (the "Property"). As you
know, the existing zoning allows for 50% lot coverage or a 93 ,000 square foot building. The
proposed Project is an office complex that was reduced from an initial 91,965 square feet to
83 ,000 square feet and now to 74,260 square feet in a new two-story office building with a two-
story below-grade parking structure and 38 surface parking spaces ("Project" or ''Third
Redesign ").
The March 12, 2018 Town Council Staff Report (the "Staff Report") includes a letter
dated March 9, 2018 submitted on behalf of the Boards of Directors of the HOAs from Pueblo de
Los Gatos , Las Casitas, The Los Gatos Commons , and Bella Vista Villages (the "March 9th
Letter") responding to the Appeal and attempting to justify the Planning Commission 's denial of
the Third Redesign. The purpose of this letter is to address the comments raised in the March 9th
Letter, and to supplement our Appeal to respond to some of the statements that the March 9th
Letter referenced from the February 14, 2018 Planning Commission meeting transcript. The
March 9th Letter purports to offer post hoc rationalizations to explain the Planning Commission 's
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ATTACHMENT 21
Bu chalter
Honorable Mayor Rennie and Members of the Town Council
March 20, 2018
Page 2
decision on February 14th_ As we will explain below, it is legally impermissible for the
neighbors to submit post-decision findings to attempt to remedy the Planning Commission 's
failure to adopt any findings as required by the Town Code and State Law. The Town Council
cannot now consider these ultra vires findings as the Planning Commission 's findings because
the Commission had mandatory duty to adopt them, and that duty cannot be delegated to ·
members of the public.
The remaining letters included in the March lih Staff Report and in the Addendum to the
Staff Report received on March 19, 2018 raise the same comments regarding the Project as those
comments submitted throughout the public review process, and they do not raise any new issues
or concerns warranting further discussion in this letter.
The Planning Commission erred and abused its discretion when it failed to consider
prior Council deliberations and information in the administrative record because it
claimed it could start from scratch in reviewing the Project on remand .
As you know, after redesigning the Project to further reduce the square footage to 83 ,000
square feet , the Council ultimately decided on October 3 , 2017 to remand the Project back to the
Planning Commission due to the receipt of new information requesting that the Applicant
consider a further reduction in the size of the Project, along with the other suggested revisions
we noted in the Appeal. While it is true that Councilmember Spector ' s motion did not include a
specific Project size for the Planning Commission to evaluate, the motion directed the Planning
Commission to "consider all [emphasis added] the information available" regarding the Project,
including the Reduced Scale Alternative of 74,260 square feet, when it reviewed the revised
Project presented to the Council. The Planning Commission did not do this.
As we noted in our Appeal , Sec . 29.20.300(c) of the Los Gatos Municipal Code provides:
·'If the only or predominant reason for modifying or reversing the decision of the
Planning Commiss ion is the availability of new information a s defined in
subsection (b )(2) above~ it is the policy of the Town that the application will b e
returned to the Commission.fiJr revieH · in light (f the new it?formutiun unless th e
Jl CH' h?f<)nnation ha s minima/ c:frect 011 the appficotiOJl .'~
The Planning Commission erred and abused its discretion when it denied the Project after
concluding the Project at 74,260 square feet was still "too big" because it did not meet the
neighbors ' latest demands for a 50,000 to 60,000 square foot building with a one-level parking
garage, even though our third design was consistent with the Town 's prior requests to reduce the
project to the size of the EIR Reduced Scale Alternative. In fact, at its January 10, 2018
Planning Commission meeting , Commissioner Janoff acknowledged that "the developers are
essentially following the guidance that was provided by the Town Council " with respect to the
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Buchalter
Honorable Mayor Rennie and Members of the Town Council
March 20, 2018
Page 3
building size (see Janoff at In 13-20, January 10 , 2018 Transcript at page 52). Rather than
consider if the Third Redesign at 74,260 square feet complied with the Town 's General Plan
policies and Zoning Code development regulations and design guidelines in light of the new
information that the Council received about the Project, however, the Planning Commission
outright rejected the Project. The Commission rejected the Project because my client did not
revise the Project to accommodate the Commission's latest demands since they contradicted the
prior Town direction and , in some cases, conflicted with the existing Property zoning.
Further, the March 9th Letter claims that at the January 10, 2018 hearing, the Planning
Commission requested that the Third Redesign preserve views by either constructing a single-
story building or by increasing the setback from the north property line. The March 9th Letter
claims that the Planning Commission did not instruct the Applicant to redesign the building to
74,260 square feet (see March 9th letter, p. 1). As the January 10, 2018 transcript demonstrates ,
however, both Commissioner O 'Donnell and Commissioner Janoff noted that they would
support the 74,260 square foot design if the building size could be achieved with a combined
one-and two-story design ( see January 10, 2018 Transcript at pages 64-69). In this regard, the
Planning Commission's January 10th motion reflected the Council 's guidance concerning a
74,260 square foot building but noted additional revisions that, upon further review as indicated
in our January 30, 2018 letter, could not be accomplished without conflicting with the prior
guidance from the Council and the neighbors ' requests as discussed below.
We explained in our January 30, 2018 letter to Ms. Armer that the Planning
Commission 's latest requested revisions could not be accomplished without shifting the building
closer to Alberto Way in conflict with prior direction from the Town Council and Planning
Commission to set the building back from Alberto Way. The reason that the Neighbors ' request
to pull back the building another 30 ' on the North side and add it to the front of the building also
conflicts with the neighbors ' prior requests and Town direction to pull the front of the building
away from the street in order to preserve views of the hills beyond the building and also to
provide additional surface parking and amenity space in front of the building. The Commission
never explained why they reversed course and rejected a design that responded to the Council
and neighbors ' prior request. Then, they denied the Project.
The March 9th Letter also claims that the 74,260 square foot design obstructs more than
half of the view corridor on the north side of the site. As demonstrated by the story poles, the
Third Redesign preserves 73% of the view corridor on the north side of the site (74'-10" current
setback reduced to 55' -0 "; 27% reduction). The March 9th Letter claims that a citizen made a
reasonable assumption based on facts that he would come home from work some day and would
be unable to look at the mountains because of the Project, and that the view "'will be lost for all
of us." The March 9th Letter erroneously suggests that the reduction in the Project size reflected
in the Third Redesign would obstruct views from public vantage points, when the Project was
designed to further reduce impacts to views -not increase them. Because one resident's view
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Buchalter
Honorable Mayor Rennie and Members of the Town Council
March 20 , 2018
Page4
may be partially impacted does not mean that all residents ' views will be impacted. Moreover,
the existing site trees , buildings and freeway on-ramp trees on and behind the Project site
obstruct views of the mountains today for many of the Alberto Way residents. The proposed
Third Redesign will improve views for the neighbors from many vantage points compared with
existing conditions.
T he Planning Commission erred and abused its di scretion when it failed to adopt
any findings to deny the CUP that were su pp o rted by substantial evidence.
We raised the concern in our Appeal that the Planning Commission did not adopt the
required findings to deny the CUP , specifically, or the Project, as a whole (see February 23 , 2018
Appeal). Moreover, we noted that even though Commissioner Janoff commented that the
Project was inconsistent with various General Plan and Community Design policies, there was
no explanation as to ho w or why the Planning Commission determined that the Third Redesign
(which appeared to comply with these policies on January 10, 2018) no longer complied with the
General Plan and Commercial Design Guidelines on February 14, 2018. Page 2 of the March 9th
Letter claims that the Commission relied on comments from Larry Cannon and a photograph
showing the building in comparison to existing commercial and residential structures on Alberto
Way , but the Planning Commission did not refer to Mr. Cannon 's comments in its deliberations
at either the January 10th or February 14th meetings.
Importantly, the Third Redesign incorporates all of Larry Cannon 's February 22 , 2017
comments on the Second Redesign, including the following: Vary roof heights , introduce
additional 1st and 2nd floor building recesses, roof breaks and projections and add additional
stucco colors in order to break up the mass of the building. Add additional trellis elements at the
window openings on both floors to add visual interest to the front fa9ade. Improve the look of the
main entry element. All these recommendations are incorporated into the Third Redesign.
Commissioner Janoff s recommendation in the Planning Commission meeting of
February 14, 2018 to redesign the project to consist of a larger first floor building plate and a
smaller second floor building plate is infeasible for a number of reasons. The maximum ground
floor plate that can be achieved at 50% lot coverage is 46,787 square feet. The resulting second
floor plate would thus be reduced to 27 ,473 square feet. The resulting oversized ground floor
plate and undersized second floor plate are inconsistent with floor plate sizes demanded by
today 's Class ·A ' office tenants and will thus adversely impact the marketability and leasability
of the development.
Furthermore, this recommendation will result in a design that conflicts with previous
neighbor requests and direction given by the Town. Previously, the neighbors and Planning
Commission recommended that the building mass at the south end of the site be pulled back
· from Alberto Way. In order to preserve view corridors on the north end of the site, the increased
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Buchalter
Honorable Mayor Rennie and Members of the Town Council
March 20, 2018
Page 5
sized ground floor plate will need to be located at the southeast comer of the site , pushing the
building mass out to the original design 's location closely adjacent to Alberto Way; resulting in
the following negative effects and reversal of previously recommended project attributes of the
Third Redesign:
• Views of hills will be impacted by the two-story building mass pushed right up
against Alberto Way street frontage at the south end of the site.
• Loss of 5,000 square foot public site amenity space at the southeast comer of the
site.
• Loss of 21 surface parking spaces which will need to be replaced in the
underground parking garage, resulting in a larger and less efficiently designed
underground parking garage and increased sized excavation.
• Loss of roughly half of the on-site construction staging area at the southeast end
of the site.
• Potential loss of proposed dedication for street widening for the addition of
dedicated left and right tum lanes at the intersection of Alberto Way and Highway
9 and the proposed bike lane on the west side of Alberto Way.
All of the above project attributes were previously requested by the neighbors and
Planning Commission at prior public hearings in which the first and second designs were
reviewed. Thus, we did not modify the design further to undo the changes that the Town and
neighbors previously requested.
The Planning Commission abused its discretion when it disregarded its
responsibilities under CEQA.
At its meeting on January 10, 2018, various Planning Commissioners indicated that they
were comfortable with the analysis contained in the Final EIR (see e.g., comments from
Commissioners Burch and Kane, January 10, 2018 Transcript at pp. 9-11 ). Then, at its February
14th meeting, the Planning Commissioners changed their minds and decided that the EIR was
inadequate even though nothing in the EIR changed between the January 1 oth and February 14th
meetings. No analysis was ever provided by the Commission to justify their comments
regarding the purported inadequacies in the EIR despite extensive evidence in the administrative
record by the Town's own consultants and Staff to the contrary. This was the problem with the
first denial and the Commission did it once again. Moreover, the Planning Commissioners came
up with their own ideas for the alternatives analysis, and those ideas do not comply with CEQA.
First, they decided to ignore the Applicant's project objectives, and then they decided they were
not responsible for determining if an alternative to a project is feasible or not.
CEQA requires that an EIR include in the Project description, the applicant 's project
objectives; not the lead agency's (14 Cal. Code Regs. 15126.6). The applicant's project
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Buchalter
Honorable Mayor Rennie and Members of the Town Council
March 20, 2018
Page 6
objectives inform the evaluation of a reasonable range of "feasible" alternatives which CEQA
requires that a public agency undertake in its analysis of a Project's environmental impacts.
Public Resources Code Section 21061.1 defines "feasible" as ''capable of being accomplished in
a successful manner within a reasonable period of time, taking into account economic,
environmental, social and technological factors." Among the factors that may be considered
when addressing the feasibility of on-site alternatives are site suitability, economic viability,
availability of infrastructure, general plan consistency, other plans or regulatory limitations, and
jurisdictional boundaries.
The EIR for the 401-409 Alberto Way project identifies the project objectives, which
included "Redeveloping the site by removing the now obsolete, aging structures and replacing
them with new, two-story Class A steel office buildings ... " and "Providing a building type that
satisfies the needs, desires, and market demands for high-tech users in Class A office space ( e.g.,
larger floor plates, ... )." Additionally, the EIR evaluated the 74,260 square foot Reduced Scale
Alternative and a No Project Alternative, but the Town was not required to analyze alternatives
with further size reductions because (1) such a proposal would not meet the stated objectives of
the project; and (2) the EIR studied a no project alternative in which the existing building would
be demolished and replaced with a building of identical square footage (31,000 square feet). The
EIR found that this "No Project -Existing Square Footage" alternative may not be feasible and
would not meet all of the project objectives.
The March 9th Letter acknowledges that our Appeal raised the concern that the Planning
Commission did not consider the "economic infeasibility" of a project smaller than 74,260
square feet. The March 9th Letter then claims that the Commission found that it was not and
could not be their job to decide how much profit a developer should make. The Planning
Commission also commented that they thought the Applicant's project objectives should be to
build Class B office space, rather than Class A.
Contrary to the assertions in the March 9th Letter and the comments made by the Planning
Commission, the Town, as the public agency that approves or denies the project is responsible
for providing an adequate discussion of alternatives, and determining whether proposed
alternatives are feasible. (See Preservation Action Council v. City of San Jose (2006) 141
Cal.App.4th 1336, 1351-52.) While the fact that an alternative may be more expensive or less
profitable is not sufficient to show that an alternative is financially infeasible, evidence that
additional costs or lost profitability would render it impractical to proceed with the project is
sufficient. (Id. at p. 1352, quoting Citizens of Goleta Valley v. Board of Supervisors (1988) 197
Cal.App.3d 1167, 1181.) Further, CEQA provides that evidence that an alternative would not
meet most of the basic objectives of the project is a reason to eliminate alternatives from
consideration. (See CEQA Guidelines,§ 15126.6(c).)
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Buchalter
Honorable Mayor Rennie and Members of the Town Council
March 20 , 2018
Page 7
The Applicant presented evidence showing that a reduction in the footprint of the project
below the Reduced Project Alternative would result in a development that is financially
infeasible and does not meet the project objectives to provide Class A office space. T he
Applicant presented evidence in a letter dated March 17, 2017 that construction of an office
project of less than 83 ,000 square feet would compromise the applicant 's ability to secure a
lender for the project because of the high development costs ($615 per square foot) and the low
annual lease payment on total costs percentage. In a subsequent letter on November 7 , 201 7, the
Applicant provided further information explaining how the reduced excavation associated with
the Third Redesign would provide sufficient savings to maintain the feasibility of the project.
Further size reductions, however, would make the project infeasible because the project would
no longer be able to provide Class "A" office space as supported by the information in the
January 3, 2018 letter from Buchalter, which includes letters from two brokers with extensive
experience leasing Class "A" office buildings in Silicon Valley. This is consistent with
applicab le ca se law findin g that w here substantial evidence shows that a reduced project is
financially infeasible, the alternative need not be further studied (see e.g., Association of Irritated
Residents v. County of Madera (2003) 107 Cal.App.4th 1383, 1399-1400; Sequoyah Hills
Homeown ers Assn. v. City of Oakland (1993) 23 Cal.App.4th 704).
Conclusion
The Appeal identifies the reasons that we believe that the Planning Commission erred
and abused its discretion in denying the Project. Based on the reasons described above and set
forth in tlJe administrative record, we believe that the March 9th Letter and its references to the
February 14th Transcript do not change the conclusion that the Planning Commission denial
should be overturned. The March 9th Letter does not compensate for the Planning Commission 's
failure to adopt findings, nor does it support its decision to deny the Project. It is legally
impermissible for the neighbors to submit post-decision findings to buttress the Planning
Commission 's failure to adopt them as required by the Town Code. The Town Council cannot
now consider these ultra vires findings as the Planning Commission 's findings because it was the
Commission 's mandatory duty to adopt them and that duty cannot be delegated to members of
the public, particularly, in this case where the Commission already took action.
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Buchalter
Honorable Mayor Rennie and Members of the Town Council
March 20, 2018
Page 8
We appreciate your consideration of our Appeal, and respectfully request that the Town
Council overturn the Planning Commission's denial of the Project, certify the EIR and approve
the demolition permit, CUP and ASA for the Third Redesign.
By
AG:sl
Sincerely,
BUCHALTER
A Professional Corporation
Alicia Guerra
cc (via email): Shelley Neis, Town Clerk
Rob Schultz, Town Attorney
Laurel Prevetti, Town Manager
Joel Paulson, Community Development Director
Jennifer Armer, Senior Planner
Randy Lamb
Shane Arters
Jolie Houston, Esq.
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