NVF:CPA:JMD
4/24/25
T-48566/2196940 1
Council Agenda: 5/13/2025
Item No.: 8.3(a)
DRAFT – Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
RESOLUTION NO. ______________
A RESOLUTION OF THE COUNCIL OF THE CITY OF
SAN JOSE 1) ADDING TO THE MULTIFAMILY HOUSING
INCENTIVE PROGRAM AS ADOPTED UNDER
RESOLUTIONS RES2024-420 AND RES2024-421
SPECIFIED MULTIFAMILY HOUSING PROJECTS
FORMERLY SUBJECT TO THE AFFORDABLE HOUSING
IMPACT FEE PROGRAM; 2) ADDING SANTANA ROW LOT
12, A PROPOSED MULTIFAMILY HOUSING
DEVELOPMENT LOCATED AT 358 HATTON STREET;
AND 3) INCREASING THE NUMBER OF UNITS FROM
1,500 TO 1,800 THAT MAY QUALIFY FOR A 50%
REDUCTION TO THE COMMERCIAL, RESIDENTIAL,
MOBILE HOME PARK TAX AND THE BUILDING AND
STRUCTURE TAX FOR PROJECTS THAT OBTAIN A
BUILDING PERMIT BEFORE DECEMBER 31, 2025,
UNDER THE MULTIFAMILY HOUSING INCENTIVE
PROGRAM
WHEREAS, the City received an allocation 62,200 units from the Association of Bay Area Governments and adopted by the California Department of Housing and Community Development for its 6th Cycle Housing Element covering the period of January 31, 2023 to January 31, 2031; and
WHEREAS, San José has experienced modest production of affordable housing in the last several years and continues to underperform in housing production, particularly in the last calendar year for multifamily housing market rate housing; and
WHEREAS, on October 26, 2023, the City Council held a study session and received the latest report on the Cost of Residential Development (“Report”) that concluded the current economic conditions remain a significant barrier to the construction of new market rates and affordable housing within Downtown and citywide; and
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Council Agenda: 5/13/2025
Item No.: 8.3(a)
DRAFT – Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
WHEREAS, following the Report, Century Urban, the City’s Consultant, provided an updated high-level feasibility analysis, noting that there has been no material improvement in key drivers of economic feasibility since publishing the Report and therefore no indication or evidence that the challenging residential development economics observed in the 2023 analysis have improved; and
WHEREAS, on December 10, 2024, San Jose City Council found that the fee reduction permitted under the Multifamily Housing Incentive Program is not a subsidy under Chapter 14.10 and thereafter adopted the Multifamily Housing Incentive Program under Resolution 2024-420 for qualifying projects listed under Attachment A to such Resolution (“Projects”); and
WHEREAS, the Multifamily Housing Incentive Program is further defined under the companion Resolution 2024-421 affecting the Project’s Inclusionary Housing Ordinance obligations codified under SJMC Chapter 5.08 (“IHO”) and also defined under Ordinance 31160 related to the Project’s tax obligations codified under SJMC Chapters 4.46 and
4.47 (collectively referred to as “Incentive Program”); and
WHEREAS, Attachment A to this Resolution contains the list of projects eligible under the Incentive Program and includes the proposed addition of Santana Row Lot 12; and
WHEREAS, the list of eligible projects in Attachment A (“Projects”) are generally located in a Planned Growth Area, e.g., Urban Village, defined in the Envision San José 2040 General Plan, have a density exceeding 50 dwelling units per acre equivalent to the minimum density in the Envision San José 2040 General Plan Transit Residential land use designation, and submitted a project application that was deemed complete by the Department of Planning, Building, and Code Enforcement by the end of December 2022; and
NVF:CPA:JMD
4/24/25
T-48566/2196940 3
Council Agenda: 5/13/2025
Item No.: 8.3(a)
DRAFT – Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
WHEREAS, the Incentive Program generally provides a waiver of the Inclusionary Housing Ordinance (IHO) in lieu fees for Projects providing at least 5% of units at an affordable housing cost or affordable rent available to households earning no more than 100% Area Median Income (AMI) that are approved by the Housing Director consistent with the Program requirements including amending the Project’s Inclusionary Housing Compliance Plan, and also provides a 50% reduction in the Building and Structure Construction Tax and Commercial, Residential and Mobile Home Park Construction Tax for the first 1,500 units meeting specified deadlines and 25% reduction in the Building and Structure Construction Tax thereafter for the remaining units in such Projects; and
WHEREAS, San Jose Lot 12 is a multifamily housing project located on a 2.94-acre site proposed by Federal Realty consisting of a five-and-a-half-story building with 258 residential units and 355 parking spaces; and
WHEREAS, San Jose Lot 12 was originally entitled under permit number PD15-066 in 2016 and through a series of permit extensions, was deemed complete by the Planning, Building, and Code Enforcement Department in December 2022; and
WHEREAS, San Jose Lot 12 was originally subject to the City’s Affordable Housing Impact Fee program (“AHIF”) adopted under Resolution No. 77218 when it completed its permit application; and
WHEREAS, on December 19, 2017, the Council adopted Resolution No. 78473 providing a transition period that allowed projects with first approvals prior to June 30, 2018 to pay the housing impact fee, rather than comply with the IHO requirements, if they met certain conditions and deadlines including the issuance of all building permits for the residential development prior to January 1, 2020; and
NVF:CPA:JMD
4/24/25
T-48566/2196940 4
Council Agenda: 5/13/2025
Item No.: 8.3(a)
DRAFT – Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
WHEREAS, on June 2, 2020, the City extended the deadline to pay the AHIF until the end of the Proclamation of Local Emergency that terminated on June 30, 2023;
WHEREAS, Federal Realty paid San Jose Lot 12’s AHIF by wire transfer on December 21, 2022 in the amount of $3,435,672; and
WHEREAS, San Jose Lot 12 meets the requirements of density exceeding 50 dwelling units per acre, and (3) is located within the Valley Fair/Santana Row Growth Area as defined in the Envision San Jose 2040 General Plan; and
WHEREAS, upon refund of the AHIF to Federal Realty, San Jose Lot 12 will be subject to the IHO.
NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF SAN JOSE THAT:
A. The above recitals are true and correct.
B. San Jose Lot 12 shall be added to the list of eligible multifamily housing projects under the Multifamily Housing Incentive Program and be subject to the IHO.
C. Subject to a public subsidy hearing under the City of San José’s Sunshine Policy, Reso 2024-99, and CA Govt Code § 53083, the Director of Housing is authorized to initiate and refund $3,435,672 to Federal Realty constituting its’ previous payment of Affordable Housing Impact Fees.
D. Increase the number of units from 1,500 to 1,800 that may qualify for a 50% reduction to the Commercial, Residential, Mobile Home Park Tax and the Building and Structure for those qualifying projects who obtain their building permit before NVF:CPA:JMD
4/24/25
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Council Agenda: 5/13/2025
Item No.: 8.3(a)
DRAFT – Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
December 31, 2025.
ADOPTED this _____ day of ___________, 2025, by the following vote:
AYES:
NOES:
ABSENT:
DISQUALIFIED:
MATT MAHAN
Mayor
ATTEST:
TONI J. TABER, MMC
City Clerk
NVF:CPA:JMD
4/24/25
T-48566/2196940 A-1
Council Agenda: 5/13/2025
Item No.: 8.3(a)
DRAFT – Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
ATTACHMENT A
LIST OF ELIGIBLE MULTIFAMILY HOUSING PROJECTS
Market-Rate Projects
Project Address Developer Last
Entitlement
Expiration
Units
1 498 West San Carlos Urban Catalyst 12/14/2028 272
2 4300-4360 Stevens Creek Fortbay/Perry Hariri 8/30/2028 407 3 14200 Union Weingarten Investors 11/2/2028 305
4 1312 El Paseo de Saratoga/1177
Saratoga Sand Hill Property 11/29/2029 772*
5 205 Dupont Miramar Capital/Perry Hariri 5/4/2028 689 6 700 Saratoga Avalon Bay Communities 3/17/2027 247
7 905 North Capitol Hanover 6/29/2028 350
8 1298 Tripp; 1325/1347
E. Julian ROYGBIV 11/29/2029 913
9 70 N. 27th HC Investment LLC 5/31/2029 198
10 1530 W. San Carlos Urban Villas LLC 6/28/2029 237
11 1520 W. San Carlos Vivji Mani 7/12/2029 256
12 1050 Saint Elizabeth Evershine XVII LP 4/19/2029 206 13 West San Carlos and Sunol Republic Urban 5/4/2028 263 14 1065 S. Winchester A&Z Development 10/25/2028 70
15 1073 S. Winchester A&Z Development 8/25/2027 61
16 605 Blossom Hill Republic Urban 8/9/2028 239
17 1197 Lick/Tamien Station Republic Urban 12/9/2026 434 18 681 E. Trimble Hannover Company 8/14/2028 1146
19 210 Baypointe Summerhill Homes 10/22/2028 292
20 San Jose Lot 12 Federal Realty 4/24/2026 258
*Revised number of project units pending City Council approval. Total 7,615
Affordable Projects
Project Address Developer Last
Entitlement
Expiration
Units
1 802 S. First Maracor/Pacific West 10/12/2028 166
2 2080 Almaden Affirmed Housing Group 10/6/2029 80
3 1371 Kooser Affirmed Housing Group 8/24/2028 190
4 525 N. Capitol Community Development
Partners 9/1/2028 160
5 771-797 Almaden Resources for Community
Development 1/28/2028 99
6 675 E. Santa Clara St. Housing Authority/Eden/Core 4/20/2028 178 7 605 Blossom Hill Green Republic Blossom Hill LLC 8/9/2028 89 8 70 Kentucky Place Charities Housing 11/9/2029 55
NVF:CPA:JMD
4/24/25
T-48566/2196940 A-2
Council Agenda: 5/13/2025
Item No.: 8.3(a)
DRAFT – Contact the Office of the City Clerk at (408) 535-1260 or [email protected] for final document.
9 501 Almaden Satellite Housing 9/1/2028 53
10 1135 E. Santa Clara Allied Housing 10/9/2026 91
11 2315 Canoas Garden Sand Hill Property Co 1/10/2028 237 12 995 E. Santa Clara First Community Housing 9/23/2028 74 13 2920/2928 Alum Rock Charities Housing 9/1/2028 83
14 934-948 E. Santa Clara Milestone Housing Group 8/8/2029 103 15 71 Vista Montana Charities Housing 3/21/2029 446
16 178 E. Trimble Pacific Companies 8/14/2028 172
Total 2276