Outlook
FW: SEPTEMBER 15th AGENDA: Items 8.1 - Multi-family Housing Incentive for 3896 Stevens Creek Blvd.
From City Clerk <[email protected]>
Date Thu 9/10/2026 10:09 AM
To Agendadesk <[email protected]>
From: Erik Schoennauer
Sent: Thursday, September 10, 202610:00 AM
To: Mahan, Matt <[email protected]>; Kamei, Rosemary <[email protected]>; Campos, Pamela <[email protected]>; Cohen, David <[email protected]>; Ortiz, Peter <[email protected]>; Mulcahy, Michael <Michael.Mulcahy@sanjoseca .gov>; Doan, Bien <[email protected]>; Candelas, Domingo <[email protected]>; Foley, Pam <[email protected]>; Casey, George <[email protected]>; Tordillos, Anthony <Anthony [email protected]>
Cc: Solivan, Erik <[email protected]>; Burton, Chris <Christoph [email protected]>; Ristow, John <[email protected]>; San, Banu <[email protected]>; John Wayland >; Kevin Ma < ; Alden Smith
Subject: SEPTEMBER 15th AGENDA: Items 8.1 - Multi-fami ly Housing Incentive for 3896 Stevens Creek Blvd. [External Email. Do not open links or attachments from untrusted sources. Learn morel Good morning, Mayor and City Council:
On behalf of Holland Partners, we request your support of this incentive package. The DeP-artments of Housing.,_ PBCE, and DOT recommend a1mroval.
With your approval this Tuesday, we can keep the construction schedule on track to build 311 new apartments (Phase I - see below) at 3896 Stevens Creek Blvd. in West San Jose. This project was the first approved under San Jose's new Ministerial Approval process back at the end of November 2025.
With these incentives, construction can begin in October 2026 .
Please email or call if you have any questions or if you want to meet.
Thanks so much, ERIK
********
The 8-story Phase I building includes 311 residential units and 6,033 square feet of ground floor retail. The unit mix contains 28 studios (9%), 221 one-bedroom units (71%), and 62 two-bedroom units (20%). The 50% Area Median Income affordable units include one studio unit, 12 one-bedroom units, and three two-bedroom units, totaling 16 units.
This message is from outside the City email system. Do not open links or attachments from untrusted sources.
Phase I Building is on the left. (Phase II is on the right.)
--
Erik E. Schoennauer
90 Hawthorne Way
San Jose, CA 95110
AND office
THE ScttOENNAUER COMPANY
Outlook
FW: Support with Careful Oversight - Item 8.1, 3896 Stevens Creek Boulevard From City Clerk <[email protected]>
Date Tue 9/15/2026 7:37 AM
To Agendadesk <[email protected]>
From: brian darby
Sent: Monday, September 14, 2026 5:01 PM
To: City Clerk <[email protected]>
Subject: Support with Careful Oversight - Item 8.1, 3896 Stevens Creek Boulevard [External Email. Do not open links or attachments from untrusted sources. Learn morel September 14, 2026
Dear Mayor Mahan and Members of the City Council:
I am writing in general support of Item 8.1 and the proposed Multifamily Housing Incentive Program tax and fee reductions for Phase 1 of the development at 3896 Stevens Creek Boulevard.
I understand why some residents may be concerned about the City waiving or reducing nearly $6.9 million in fees and construction taxes. These revenues serve important public purposes. lnclusionary Housing Ordinance fees help address San Jose's need for affordable housing, while Building and Structure and Commercial-Residential-Mobile Home Park construction taxes support transportation improvements such as pavement maintenance, pedestrian safety, complete streets, and traffic-calming projects. Forgoing this revenue should never be treated as cost-free or automatic.
At the same time, the City must consider what is likely to happen without the incentive. According to the staff report, high-density rental housing is generally not financially feasible under current conditions because of elevated construction costs, high interest rates, and rents that are insufficient to cover development costs. Staff further concludes that without these incentives, this particular project would be unlikely to move forward at this time.
If a housing project does not financially pencil out and therefore is not built, the City does not necessarily preserve revenue that it would otherwise receive. It may instead receive no construction tax revenue from the stalled project, no new property-tax revenue generated by the completed development, and none of the housing, employment, retail activity, or other economic benefits associated with construction and occupancy.
Phase 1 would provide 31 1 apartments, including 295 market-rate units and 16 deed-restricted affordable units for households at 50% of area median income. It would also include approximately 6,033 square feet of ground-floor retail space. Staff estimates that construction will create approximately 500 full-time jobs. Although the City would forgo approximately $1.46 million in construction-tax revenue and waive an estimated $5.48 million lnclusionary Housing Ordinance in-lieu fee, it would still collect approximately $1.46 million in construction taxes from the project.
For these reasons, I believe the incentive can be justified as a practical means of turning an approved but financially difficult proposal into housing that is actually constructed. San Jose desperately needs additional housing for working people, seniors, families, and others who cannot afford current market prices. An incentive that helps move a viable project from paper to construction can be a legitimate investment in the City's future.
However, my support comes with the expectation of careful oversight. The City should ensure that:
1. The incentive is conditioned on measurable construction milestones and timely project completion.
2. The full public benefit-including the 16 affordable units at 50% of area median income-is legally documented and enforced.
3. The City can reduce or recover benefits if the developer fails to meet its obligations.
4. Staff reports back on whether the project begins construction on schedule and whether the incentive produces the housing and employment benefits represented to the Council.
5. The cumulative effect of these incentives is monitored so that the City does not unintentionally weaken funding for affordable housing, transportation safety, or other critical public needs.
6. Future incentive requests continue to receive individual financial scrutiny rather than becoming routine approvals.
The purpose of an incentive should be to close a genuine financial feasibility gap-not simply to improve a developer's return. The City should approve incentives when credible evidence shows that a worthwhile project probably will not proceed without them and when the public receives enforceable benefits in return.
On balance, I support Item 8.1 because the evidence presented indicates that the project is unlikely to move forward at this time without assistance. The proposed incentive appears capable of producing 311 urgently needed homes, including 16 affordable homes, while generating construction employment, future property-tax revenue, and additional neighborhood economic activity.
I respectfully encourage the Council to approve the proposal while maintaining strong accountability, transparency, and protection of the public interest.
Sincerely,
Brian Darby
This message is from outside the City email system. Do not open links or attachments from untrusted sources.