Att 13 - Supplemental Information for Housing Element 2023-2031

Supplemental Information
for
Housing Element 2023-2031

Appendix C: Housing Resources and Sites Inventory
• Housing Element Sites Inventory Review Memo, Economic and Planning Systems, Inc.

May 17, 2024
Appendix F: Public Participation
• City Response Letters
o Housing Action Coalition Response, May 17, 2024
o California Housing Defense Fund Response, May 17, 2024

M EMORANDUM
To: Manira Sandhir, City of San Mateo
From: Thomas Gonzales, Darin Smith, and Ryan Martinez
Subject: Housing Element Sites Inventory Review; EPS #241028 Date: May 17, 2024
This memo summarizes a review conducted by Economic & Planning Systems, Inc. regarding potential housing sites identified in San Mateo's Housing Element. This final version contains additional information and clarifications based on discussions at San Mateo’s Planning Commission on April 23, 2024 regarding whether there is substantial evidence that the uses on the non-vacant sites are likely to be discontinued during the planning period.

The California Department of Housing and Community Development (HCD) directed the City to address concerns regarding existing uses potentially hindering development on some sites in conjunction with adoption of the Housing Element.

EPS’s review concludes that despite certain challenges posed by existing uses, market trends demonstrate that redevelopment of existing uses on sites included in the Housing Element Sites Inventory is likely to occur within the planning period.

Summary of Key Findings
 Redevelopment of commercial sites for housing is a growing national trend also clearly reflected in development trends within nearby cities.
 Strong housing demand and high land values for residential development, combined with weakening performance of
commercial uses, have made redevelopment within the planning period financially attractive and feasible for commercial property owners.
 Most existing commercial leases are expected to expire within the eight-year Housing Element planning period, reducing that barrier to future redevelopment opportunities.
 The City's methodology for site selection reflects observed industry trends, property owner interests, and site-specific conditions likely to support redevelopment and identifies sites where uses may well be discontinued during the planning period.

Memorandum: Housing Element Sites Inventory Feasibility Review Page | 2
Existing Uses Do Create Financial and Logistical Challenges Many sites in the inventory currently have commercial uses. "Buying out" existing leases or consolidating surface parking into structures can significantly increase development costs relative to constructing on vacant sites.

Still, Real Estate Industry Trends Indicate Movement toward Redevelopment Despite constraints, there are numerous examples of housing developments that have been built on sites with existing uses, and shopping center conversions and phased residential development on commercial surface parking lots are increasingly common real estate industry trends. Also, tenants are increasingly open to negotiating with developers for phased projects that improve long-term benefits for a retail property by adding or substantially increasing the number of residential units on a site.

Recently built examples within San Mateo include Station Park Green (430 Station Park Circle, built 2018), Kiku Crossing (480 E 4
th Street, built 2024), and The Lark (1950 Elkhorn
Court, built 2015). Other recent, prominent examples of nearby shopping center conversions include Stonestown Galleria (3,500 apartments approved in San Francisco in May 2024), and Westlake Shopping Center (393 apartments approved in Daly City in September 2022).

Local Development Economics Support Redevelopment
High housing demand has driven up land values for residential development, making it financially attractive for many commercial property owners to offer their sites for redevelopment during the planning period, even if they must absorb certain costs to terminate leases, consolidate parking, etc.

Using data from Costar,1 a subscription-based real estate data service that is an industry standard information source, EPS analysis of available transaction data shows that developments including residential uses paid between $9.5 to $17 million from 2016-2020 for land. Similar land purchases in 2021-2022 increased further to between $19 and $31.6 million per project, which is sufficient to purchase underutilized commercial land with existing uses where residential uses are permitted. Note that achievable land purchase price will depend on allowable zoning at a specific site.

Even as land values for residential development have been increasing, values of existing uses have been decreasing. Costar data again demonstrates that rents and building sales prices for commercial office and retail uses in San Mateo and San Francisco Counties fell significantly between 2019 and 2023, while vacancy rates have increased. This divergence of value will make redevelopment for residential uses more viable for many commercial sites.

1 Costar (costar.com)
Economic & Planning Systems
Page | 3
Regional Trends Indicate Commercial Redevelopment is Common EPS has confirmed that housing redevelopment on sites with existing commercial uses is reasonable, as most large residential projects in the surrounding area have occurred on such sites. EPS used data from Costar, a commercial real estate data provider, to identify the 43 largest residential/multifamily developments built in San Mateo County and nearby areas of Santa Clara County since 2014. EPS then used historical Costar and historical imagery (from Google Maps and Google Earth) to confirm that 88% of these projects were on land with previous commercial uses, indicating that such redevelopment is not only possible but in fact the norm in the general market area.
2 Lease Term Research Shows Opportunities within the RHNA Period Although redevelopment of commercial uses is complex, EPS research has indicated that most commercial leases in San Mateo have terms of five years or less. EPS reviewed available term data for 248 commercial leases in San Mateo obtained from Costar and found that 64% of them had a term of 5 years or less, suggesting that most existing use leases will expire within the Housing Element cycle ending in 2031. 3 Furthermore, the presence of
existing leases at a particular property may generally be less of a constraint to the discontinuation of existing uses over such a longer, eight-year period, where economics support redevelopment into different uses.

Housing Sites Inventory Selection Criteria Identify Sites that are among those Most Likely to Redevelop during the Planning Period Over 40% of the 7,015 total housing units in the City’s RHNA allocation are projected to be developed in projects that are already in the development pipeline. Most of the remaining development capacity is on sites for which the City has identified documented redevelopment interest or potential. A smaller proportion of capacity (roughly 14% of total unit capacity) is on sites for which developers or owners have not yet expressed interest in redevelopment but with multiple physical, use, or financial characteristics suggesting potential redevelopment during the planning period.

Additional discussion, data, citations, and case study examples regarding these findings can be found on the attached presentation materials.

Attachment: Housing Element Sites
Inventory Review Presentation

2 Sources: Costar (costar.com), Google Maps (google.com/maps), and Google Earth (earth.google.com) 3 Source: Costar (costar.com)
Economic & Planning Systems, Inc.The Economics of Land Use 1330 Broadway, Suite 450  Oakland, CA 94612
510 841 9190  www.epsys.com

HOUSING ELEMENT

SITES INVENTORY
REVIEW
May 17, 2024
EPS #241028
Economic & Planning Systems EPS PPT Presentation | 1

HCD INSTRUCTIONS
 HCD found the City’s Housing Element in substantial compliance with state law  Directed City to “find existing uses are not an impediment to additional residential development in the planning period” given the reliance on “nonvacant sites” to accommodate a substantial portion of the RHNA targets  City needs to make these findings when adopting the Housing Element Economic & Planning Systems EPS PPT Presentation | 2

SUMMARY OF KEY FINDINGS
 While existing uses may constrain redevelopment feasibility, market trends demonstrate that redevelopment of existing uses on sites included in the Housing Element Sites Inventory is likely to occur within the planning period – EPS identified that 88% of units in large multifamily projects built since 2014 in nearby cities occurred on land previously developed for commercial uses – Most current commercial leases in San Mateo are expected to expire within the Housing Element cycle, giving landlords a chance to consider redevelopment vs. lease renewals or re-tenanting
– Market trends (vacancy, rent, sale price) for commercial uses have weakened in recent years
– Land values for residential development have been very high, enabling developers to overcome financial obstacles to redeveloping existing commercial sites  The City’s methodology for site selection is reasonable as it reflects observed trends in redevelopment and site-specific conditions

EVALUATION OF EXISTING USES AS SITE CONSTRAINTS
Economic & Planning Systems EPS PPT Presentation | 4

EXISTING USES MAY CONSTRAIN REDEVELOPMENT FEASIBILITY
 Many of the properties in the City’s Housing Element Site Inventory include existing commercial uses. The cost of “buying out” existing commercial leaseholders can increase the cost of purchasing commercial land for a redevelopment project.  Estimating this cost can be challenging and difficult to generalize due to limited available data and the complexity of commercial leasing activity—each site and set of leases and tenants will present different costs and issues.  Overall, it is expected that active/profitable uses at a site add significant risk for redevelopment in terms of timing and cost; in some cases, a tenant that does not want to interrupt its business activity can prevent them from redeveloping until the end of the lease term.
 Some landlords may have recapture clauses that reduce these risks and costs, but these are rare (or rarely enforceable) for leases with experienced national/regional tenants. Even for phased redevelopment (e.g., on parking lots), loan and tenant agreement terms typically make changes to the property difficult to negotiate.

Economic & Planning Systems EPS PPT Presentation | 5

BUT STILL REASONABLE TO EXPECT REDEVELOPMENT OF EXISTING USES  Redevelopment of shopping centers and other commercial uses (both wholesale and phased) has been a growing industry trend for at least a decade
1 – Developers have looked to add residential uses to shopping centers to create mixed-use nodes and activity centers that better meet changing consumer demand for retail
– Developers looking to improve site utilization have built residential uses on top of former surface parking lots at shopping centers, office parks, and hotel sites
 Tenants are increasingly interested in negotiating and partnering with owners, especially on phased projects that may have long-term benefits of drawing more customers and
activity to a property or shopping center
2  2022 data shows that housing has become the most common redevelopment use at mall sites across the U.S.
– 54% of sampled redevelopment projects included
residential uses

INSERT IMAGE
Example site in Orange, CA with housing built on the former surface parking lot of a hotel development, which has been consolidated into a multistory parking garage.
1 Source: Turning Malls into Neighborhoods, Urban Land, February 27, 2023 2 Source: 'Ransom Payment' No More: Mall Anchors Losing Their Leverage As Owners Ramp Up Redevelopment, Bisnow, October 8, 2023 3 Source: Jones Lang LaSalle website article, March 9, 2023

Economic & Planning Systems EPS PPT Presentation | 6
EXAMPLES: REDEVELOPMENT WITH EXISTING USES
 83% of units in active development pipeline identified in Housing Element are located on sites with some existing commercial uses  Concar Passage (San Mateo Housing Element site)
– 961 multifamily units and 40,000 SF of retail approved by City Council for

14.5-acre site currently occupied by Concar Shopping center • Source: Concar Passage | San Mateo, CA - Official Website (cityofsanmateo.org)  Stonestown Galleria Redevelopment (San Francisco, CA – approved May 2024) – 3,500 homes to be developed on 40-acre mall site, with no planned discontinuation of mall operations and uses, and a slight increase in commercial retail uses at the site
• Sources: San Francisco Chronicle, SF YIMBY
 Westlake Shopping Center Redevelopment (Daly City, CA – approved Sept 2022) – 393 apartments approved to date at 25-acre shopping center as phased redevelopment of individual parcels with continued retail operations • Source: The Real Deal, City of Daly City

See additional examples in atta
ched Redevelopment Case Studies
Stonestown Galleria Plans
Source: Brookfield Properties
Westlake Shopping Center Plans
Source: SGPA Architecture and Planning
Concar Passage Plans
Source: City of San Mateo website
Economic & Planning Systems EPS PPT Presentation | 7

LOCAL DEVELOPMENT ECONOMICS JUSTIFY REDEVELOPMENT
 Strong demand for housing has increased the land price that residential developers can pay, making it likelier that sites with existing commercial uses will be redeveloped into housing within the planning period  EPS found that developers in San Mateo paid between $19 and $31.6 million per acre for residential (including mixed-use) developments in 2021-2022, up from $9.5 to $17 million per acre in 2016-20201
– These land values are enough to finance the purchase of many existing office or retail sites, especially underutilized sites such as those identified in the City’s Site Inventory – They can also justify the consolidation of surface parking into a parking garage1  Supports Housing Element claim:
– “Rather than the existing uses discontinuing from lack of interest, market trends reveal that developers have bought out long-term businesses to allow redevelopment into housing or utilized phased development or partial site redevelopment to allow the existing use(s) to remain while new housing was developed.” (p H-C-16) 1 EPS analyzed 22 separate property transactions associated with eight separate residential and mixed-use development projects in San Mateo from Sept. 2016 to Nov. 2022. Data was primarily sourced from CoStar. 2 EPS developed a conservative estimate of $12 – 15 million as the cost of building a parking structure to free up one acre of developable land Economic & Planning Systems EPS PPT Presentation | 8

OBSERVED DEVELOPMENT TRENDS SUPPORT STATEMENT
EPS researched the previous uses at large multifamily housing projects built since 2014 within San Mateo County and nearby cities in Santa Clara County1:
 The 43 largest (~200+ units) projects either completed or under construction include approximately 15,795 total units
 Of these units, 13,937 units (88%) have been built on land previously developed for office, retail, industrial, and/or associated parking uses  Another 829 units (5%) have been built on land previously developed for residential uses
– The City of San Mateo has allocated fewer than 100 units to sites with existing residential uses (less than 2% of its total housing site inventory)  Only 1,029 units (6.5%) have been built on land that was either vacant or dedicated to public parking (e.g., BART and Caltrain parking lots) 1 EPS looked at the 43 largest residential development projects identified from CoStar data. EPS reviewed historic property data from CoStar as well as historic imagery from Google Maps and Google Earth in order to confirm prior uses.

Economic & Planning Systems EPS PPT Presentation | 9

LEASE TREND RESEARCH SHOWS OPPORTUNITIES
EPS analyzed leases and subleases signed in the last five years (since Apr. 2019) for which lease term data from CoStar is available1:
 Most commercial leases were signed for a term of five years or less – Out of 248 total leases, about 158 (64%) were for five years or less  The largest commercial leases had longer terms
– Of the 25 largest commercial leases* (more than 10,000 square feet), 12 (48%) were for a term of 5 years or less
 EPS identified over 1.44 million square feet of rentable space with leases set to expire in the next five years (by Apr. 2029)
 These data suggest that most existing commercial leases will expire during the current Housing Element cycle (2023-2031), making their sites more viable for redevelopment
1 Costar provided term length data for 248 commercial leases, out of a total of 854 known leases signed since Apr. 2019 within San Mateo city limits.

Economic & Planning Systems EPS PPT Presentation | 10

WEAKENING MARKET TRENDS FOR EXISTING USES
 Vacancies are up for both
office and retail uses
 Rents and building values per
square foot are down
– Retail buildings are worth just
over half of 2019 values
– Office buildings are worth
less than half of 2019 values
 These changes indicate
oversupply relative to demand
 Increases likelihood that
office and retail existing uses
may be discontinued within
the planning period

0.00 0.50

1.00 1.50

2.00 2.50

3.00 3.50

4.00 2019 2023
Index of Commercial Market Performance,
San Francisco & San Mateo Counties
Source: Costar
Office Sale
Price/SF
Office Rents
Office
Vacancy
Retail Sale
Price/SF
Retail Rents
Retail
Vacancy

REVIEW OF HOUSING SITES INVENTORY METHODOLOGY
Economic & Planning Systems EPS PPT Presentation | 12

SUMMARY OF SITE SELECTION CRITERIA FACTORS
Any site meeting any one of the following five criteria:

1. Property owner or developer interest in redevelopment

2. Site that is developer owned

3. Site with previous proposal for redevelopment

4. Vacant site

5. Sites with surface parking lot use only or similar unimproved condition Or, meeting at least three of the following five criteria:

6. Existing use similar to commonly redeveloped sites (retail or shopping center, banks, office, gas station or automotive use, grocery stores, lower density residential)

7. Structure is more than 30 years old (or 20 years if commercial use)

8. Current structure is one-story only

9. Property has Improvement to Land Value ratio of <1.0 (or <2.5 if commercial use)

10. Property has 50% or less lot coverage
Economic & Planning Systems EPS PPT Presentation | 13

SITE SELECTION CRITERIA DETAILED ANALYSIS
Provides reasonable expectation that existing uses are
likely to be discontinued during the RHNA cycle?
Criteria
Yes, active interest from a developer or owner provides reasonable expectation. 1. Property owner or developer interest in redevelopment Yes, confirming a known owner that specializes in development provides reasonable expectation.

2. Site that is developer owned
Yes, a history of redevelopment proposals provides reasonable expectation as the site was previously vetted and pursued by developers.

3. Site with previous proposal for redevelopment
Yes, a vacant property condition provides reasonable expectation given the high demand for housing and high value of developable sites.

4. Vacant site
Yes, an unimproved property condition provides reasonable expectation given the high demand for housing and high value of developable sites.

5. Sites with surface parking lot use only or similar
unimproved condition
Yes, this provides a reasonable expectation as these are uses the City has seen discontinued for redevelopment projects in the recent past.

6. Existing use similar to commonly redeveloped sites (retail/shopping center, banks, office, gas station, etc.) Yes, aging properties that have reached the end of their useful life and have been fully amortized or depreciated are more likely to be redeveloped than newer buildings.

7. Structure is more than 30 years old (or 20 years if commercial use) Yes, one-story structures are among the most common type of commercial property that is redeveloped where allowable densities are greater.

8. Current structure is one-story only
Yes, properties on which the land is more valuable than the buildings above would indicate potential financial incentive for redevelopment. However, assessor data regarding values is impacted by Prop 13 and may not reflect true market value of land or improvements.

9. Property has Improvement to Land Value ratio of <1.0 (or <2.5 if commercial use) Yes, lot coverage of less than 50% is correlated with underutilization (often large surface parking areas) that provide a reasonable expectation.

10. Property has 50% or less lot coverage
Economic & Planning Systems EPS PPT Presentation | 14

SELECTION CRITERIA FOCUS ON SITES WHERE THE EXISTING USES ARE LIKELY TO BE

DISCONTINUED DURING THE PLANNING PERIOD
 Sites that are already active in the development pipeline represent nearly half of the required total unit count from RHNA (3,088 out of 7,015 units)  In general, Criteria 1-5 reflect sites with proven interest in or low barriers to redevelopment during the 2023-31 Housing Element Planning period  Criteria 6-10 provide a less clear expectation of redevelopment interest, but they do reflect redevelopment potential, and were used to select a relatively small number of sites:
– Taken together, these sites account for a
approx. 14% of all site capacity
(1,449 units) within the inventory
– EPS estimated that only about 500 units
would be lost if a higher threshold (at least 4
of the 5 criteria) was required for site
selection, still leaving the Housing Element
with adequate physical capacity for units

REDEVELOPMENT CASE STUDIES
Economic & Planning Systems EPS PPT Presentation | 16
1001 SHORELINE BLVD, MOUNTAIN VIEW
The Residences @ Shoreline Gateway Under Construction (Expected 2025) Outer Mountain View/Los Altos Submarket
Residential Project Size: 7 stories, 203 units
Lot Size: 8.02 Acres Total – 25 Units per Acre

2.35 Acres – 86 Units per Acre (Residential Portion Only)

PHASED INFILL MULTIFAMILY ON FORMER OFFICE SURFACE PARKING New Use: Seven-story multifamily building
Prior Use: Parking lot and recreational space
(volleyball and basketball court) associated with a
Google office building built in 2017
Description: Construction began after 6-story office
parking garage constructed on adjacent portion of
site. An additional 100 condominiums are planned
for the site but not yet under construction.

Source: City of Mountain View
Economic & Planning Systems EPS PPT Presentation | 17
1001 SHORELINE BLVD, MOUNTAIN VIEW BEFORE: SEP. 2020
Source: Google Earth
Economic & Planning Systems EPS PPT Presentation | 18
1001 SHORELINE BLVD, MOUNTAIN VIEW AFTER: FEB. 2024
Source: Google Earth
Economic & Planning Systems EPS PPT Presentation | 19
1401 BROADWAY ST, REDWOOD CITY
1401 Broadway Street – Broadway Plaza apartmentsUnder Construction (Expected 2026) Staumbaugh Heller Submarket
Residential Project Size: 6 stories, 518 units (120 affordable) Lot Size: 12.2 Acres Total – 43 Units per Acre

6.3 Acres – 83 Units per Acre (Residential Portion Only)

REDEVELOPMENT OF RETAIL SHOPPING CENTER
New Use: Six-story multifamily building and
420,000 SF office (proposed)
Prior Use: Retail Strip Mall with former tenants
including: CVS, Office Max, Big Lots, UPS
Description: Residential portion of project is
under construction. Remainder of site is reserved
for proposed office uses.

Source: CoStar
Source: BizJournals
Economic & Planning Systems EPS PPT Presentation | 20
1401 BROADWAY ST, REDWOOD CITY BEFORE: APR. 2018
Source: Google Earth
Economic & Planning Systems EPS PPT Presentation | 21
1401 BROADWAY ST, REDWOOD CITY AFTER: FEB. 2024
Source: Google Earth
Economic & Planning Systems EPS PPT Presentation | 22
550 E WEDDELL DR, SUNNYVALE
Encasa Apartments Built 2016
Outer Sun Garden Submarket
Residential Project Size: 4 stories, 465 units
Lot Size: 12.0 Acres – 39 units per acre

REDEVELOPMENT OF FLEX BUILDINGS WITH RECENTLY LEASING ACTIVITY New Use: Six-story multifamily building
Prior Use: Fair Oaks Business Park: 180K sq. ft. of
flex space across 10 facilities in addition to
surface parking (demolished 2015)
Description: At least two tenants leased in 2013,
prior to sale to developer in 2014
Source: CoStar
Economic & Planning Systems EPS PPT Presentation | 23
550 E WEDDELL DR, SUNNYVALE BEFORE: APR. 2013
Source: Google Earth
Economic & Planning Systems EPS PPT Presentation | 24
550 E WEDDELL DR, SUNNYVALE AFTER: APR. 2017
Source: Google Earth
Economic & Planning Systems EPS PPT Presentation | 25
100 ASPEN WAY, MOUNTAIN VIEW
Landsby ApartmentsBuilt 2022
The Crossings Submarket
Residential Project Size: 5 stories, 632 units
Lot Size: 8.75 Acres - 72 units per acre

REDEVELOPMENT OF FLEX BUILDINGS WITH RECENTLY LEASING ACTIVITY New Use: Five-story multifamily building with 15,000
sq. ft. of ground floor retail
Prior Use: Three separate lots: vacant site of former
Safeway grocery store; active/leased small retail strip; and active/leased Old Mill Office Center (58k sq. ft.).

Description: 40k+ sq. ft. of office leases were signed
within the three years prior to demolition (2016-2018)
and 4,500 sq. ft. of retail leases signed 2013-15.

Source: CoStar

Economic & Planning Systems EPS PPT Presentation | 26
100 ASPEN WAY, MOUNTAIN VIEW BEFORE: AUG. 2018
Source: Google Earth

Economic & Planning Systems EPS PPT Presentation | 27
100 ASPEN WAY, MOUNTAIN VIEW AFTER: AUG. 2023
Source: Google Earth
Source: Google Earth
Building Division (650) 522-7172 · Code Enforcement Division (650) 522-7150 Housing Division (650) 522-7220 · Planning Division (650) 522-7212 · General (650) 522-7200

May 17, 2024

Mr. Thomas B. Mayhew
Mr. Charles J. Higley
Farella Braun + Martel
One Bush Street, Ste. 900
San Francisco, CA 94104

Via email: [email protected], [email protected]

RE: Comment Letter on San Mateo’s Revised 2023-2031 Housing Element

Dear Mr. Mayhew and Mr. Higley,

This letter responds to your April 19, 2024 correspondence (“Letter”) on behalf of the Housing Action Coalition (“HAC”). Notably, you previously submitted comment letters to the City of San Mateo (“City”) and/or the State of California Department of Housing and Community Development (“HCD”) on January 3, 2023, February 24, 2023, August 9, 2023, November 14, 2023, and December 19, 2023.

On December 6, 2023, and April 22, 2024, the City provided written responses to your comments. The City’s prior responses addressed the probability of nonresidential development, the City’s adjusted timeframe of recently approved projects (2019-2023) to inform the housing sites inventory methodology, and other questions regarding the feasibility of housing opportunity sites and allocation of units on particular sites.

Sites Inventory Comments

As already detailed in the Revised 2023-2031 Housing Element (“Revised Housing Element”) and the City’s April 22, 2024 response letter, the City prepared an analysis demonstrating the redevelopment potential of existing non-vacant commercial sites. This analysis was included in Appendix C, Section 4.3 (Non-Vacant Site Redevelopment Analysis and revised Table 2).

The additional analysis examines existing site characteristics and utilizes objective criteria to evaluate each parcel for near-term redevelopment. Factors considered by the City to determine redevelopment potential included property owner or developer interest in redevelopment, whether the site is developer-owned, whether the site had a previous proposal for redevelopment, whether the site has surface parking lot areas or similar unimproved features, whether the existing use is similar to commonly redeveloped sites such as retail/shopping centers, banks, offices, gas stations, etc., whether structures are more than 30 years old, whether current structures are one-story only, whether the property has an improvement to land value ratio of less than 1.0 (or

2.5 if commercial), and whether there is 50 per cent or less lot coverage. These characteristics were determined individually for each non-vacant site and are further described in Appendix C. Other criteria considered on an individual basis include physical characteristics, floor area ratio, location and context, local knowledge, and environmental and infrastructure constraints.

CITY OF SAN MATEO

COMMUNITY DEVELOPMENT DEPARTMENT

330 W. 20th Avenue
San Mateo, CA 94403
www.cityofsanmateo.org
(650) 522-7000

These criteria were chosen in response to HCD’s Sites Inventory guidance that suggests similar criteria for identifying appropriate sites for future development. HCD determined that application of this methodology and use of such criteria substantially complied with State law and identified sites likely to redevelop. Similar methodologies are also used by many jurisdictions to develop their RHNA sites allocation. As provided in the HCD Sites Inventory guidance, lease information is only one criterion to determine the potential for redevelopment during the planning period and, by itself, does not preclude a site from being considered a housing opportunity site if there are other favorable indicators.

Nevertheless, Economic & Planning Systems, Inc. (“EPS”) conducted a peer-review of the City’s housing sites redevelopment assumptions and methodology used in the Revised Housing Element. EPS summarized their findings in a final memorandum submitted to the City on May 17, 2024. Overall, EPS concluded that market trends demonstrate that redevelopment of existing uses on Housing Element sites is likely to occur within the planning period. EPS noted that the methodology used for site selection is reflective of observed industry trends, property owner interests, and site-specific conditions, and that the selection criteria focus on sites where the existing uses are likely to be discontinued during the planning period. Specific findings that EPS identified to support the City’s methodology and Sites Inventory include:

• Since 2014, 88% of large multi-family projects built in San Mateo County and nearby cities were on land with previous commercial or office uses. Shopping center conversions and phased residential development on commercial surface parking lots are increasingly common real estate industry trends; land values for residential development have been increasing, while values of existing commercial uses have been decreasing.
• Most commercial leases in San Mateo have terms of five years or less, and existing leases on a particular property may generally be less of a constraint over an eight-year period. Tenants are increasingly open to negotiating with developers, especially for phased projects that bring customers and activity to a retail property.

A summary table of the thirteen (13) properties identified in your Letter is attached to the end of this letter that provides the specific criteria that were used to demonstrate redevelopment potential for each individual site based on the City’s methodology, found to be acceptable by HCD and supported by the EPS report. In addition, of the approximately 3,550 units contained in those 13 properties, Appendix C, pages H-C-31 through H-C-64, provides a detailed, individual site analysis for the eight most significant properties, projected to have a total capacity for over 3,100 units.

Consideration of Nonresidential Projects

Your Letter reiterates earlier comments that the City neglected to consider nonresidential projects that were approved between 2019-2023. As stated in the City’s December 6, 2023 and April 22, 2024 response letters, the City anticipates that most new projects proposed during this housing cycle will be residential or have a significant residential component. This is based on the development approval trends for pipeline projects since 2019 outlined in Table 4 of the Revised Housing Element, current economic and construction financing conditions which appear to favor residential development, and verbal input received from property owners and developers who state that it is very challenging to secure financing for non-residential projects. It is anticipated that development trends observed since 2019 will continue during this Housing Element cycle. To account for the possibility that approximately 10 percent of projects may be entirely non-residential, the City has generally assumed a capacity of 90 percent on sites zoned for mixed uses. On the major sites reviewed in Appendix C, capacity ranges from 70 to 100 percent of base density, depending on whether the site is a pipeline project, owner interest and site characteristics, even though the majority of the recently developed sites shown in Table 2 utilized state density bonus provisions to achieve more than 100 percent of base density. The City also did not assume that 100 percent of each parcel would be redeveloped for housing.

Your Letter also states “the draft also fails to determine or adjust the capacity numbers based on “typical densities of existing or approved residential developments at a similar affordability level” as required by Government Code § 65583.2(c)(2).” The City provided a detailed response to this issue in the April 22, 2024, response letter under the heading Affordability Allocations.

Lastly, your Letter states “[the Housing Element] projects capacity numbers that are too high for sites where no application has yet been approved, by counting bonus density requests as if they have already been approved.” The City provided a detailed response to this issue in the April 22, 2024 response letter under the heading Pipeline Project Densities. In addition, the City has a strong recent track record of approving all housing development projects that have been proposed, with over 50% increasing their density during the development review process. Table 1 (Pipeline Projects) in Appendix C of the revised Housing Element includes additional information to support this finding. Please find attached an updated version of Table 1 with a new column showing that only one pipeline project had a reduction of a single unit (291 to 290 units). Nine out of 17 projects had increased unit counts from the time of project submittal to project approval. The Housing Accountability Act does not allow reductions in proposed density, even additional density achieved through density bonuses, except in rare instances. (Government Code Section 65589.5(j)(1).)

In addition to the responses outlined above, we would like to highlight that on March 18, 2024, the City Council adopted Strive San Mateo General Plan 2040, which creates capacity for 19,764 new dwelling units around the City, pending a ballot measure this November to amend the City’s height and density limits, approved in 2020 by the voters (Measure Y). There are also other properties in the City, such as the 10.3-acre Marriott site, that recently became a housing opportunity site but is not listed on the Sites Inventory that could further increase the City’s RHNA buffer. The City is also moving forward with a housing opportunity overlay district (Housing Element Policy 1.10) that would allow 32 sites within the City that were on previous housing elements to develop qualifying housing projects by-right without any discretionary review process.

We hope this additional information provides further details about our methodology and approach and helps alleviate your concerns. If you have any questions, feel free to email me at [email protected] (please copy the City Attorney) or we can set up a meeting to discuss.

Sincerely,

Zachary Dahl, AICP
Interim Community Development Director

Cc: Prasanna W. Rasiah, City Attorney
[email protected]

Attachment 1 – Sites Inventory Excerpt (Table 2 in Appendix C) Attachment 2 – Pipeline Projects 2019-2023 (Table 1 in Appendix C)

ATTACHMENT 1

Housing Element
ID/ Ownership Site Address APN
Owner/
Developer
Interest
(1)
Developer
Owned
(2)
With
Previous
Proposal
(3)
Vacant
Site (4)
Limited
Structures
(5)
Met 3 of
6-10
Existing
Use
Trend (6)
Age
(7)
Single
Story (8)
Prior ILV
(9)
Lot
Coverage
(10)
23 – Bridgepointe
Shopping No site address 035-466-
100 Y Yes Y 0.05 0%
17 – The Atrium 1900 S Norfolk St 035-391-
090 Y Yes Y 1983 0.35 17%
14 – Hillsdale
Mall 41 W Hillsdale Blvd 039-490-
170 Y Yes Y 0 0.72 40%
2950 S El Camino
Real
039-353-
010 Y Yes Y 3.17 29%
No site address 039-353-
020 Y Yes Y - 0%
No site address 039-353-
030 Y Yes Y 0.5 0%
No site address 039-353-
040 Y Yes Y 0.49 0%
3590 S El Camino
Real
042-121-
080 Y Yes Y 0.59 44%
36th Ave/Colegrove
St
042-121-
060 Y Yes Y - 0%
24 – Parkside
Plaza 1850 S Norfolk St 035-381-
020 Yes Y 1957 Y 0.57 90%
1826 S Norfolk St 035-381-
030 Yes Y 1957 Y 0.32 33%
15 – Borel Square 93 Bovet Rd 039-011-
450 Y Y Yes Y 0 - 8%
71-77 Bovet Rd 039-011-
460 Y Y 1999 0.56 100%
71-77 Bovet Rd 039-011-
470 Y Y 0 1.18 96%
71-77 Bovet Rd 039-011-
480 Y Y 1968 3.18 102%
1750 S El Camino
Real
039-011-
500 Y Y 4.24 95%
71-77 Bovet Rd 039-011-
510 Y Y Yes Y - 9%
1690 El Camino Real 039-012-
010 Y
25 – Borel Place 1650 Borel Pl 039-011-
400 Y Yes Y 0 2.33 17%

150 W 20th Ave 039-030-
220 Y Yes Y 1961 0.42 41%
or 1925 Elkhorn Ct
22 – Olympic 4107 Piccadilly Ln 042-242-
060 Y Y 1.43 71%
ATTACHMENT 1

11 41st Ave 042-242-
070 Y Y 1.23 60%
40 42nd Ave 042-242-
160 Y Y 1.31 85%
49 42nd Ave 042-243-
020 Y Y Yes Y 0 3.01 48%
42nd/El Camino Real 042-244-
040 Y Y Yes Y Y - 1%
4242 S El Camino
Real
042-244-
050 Y Y 5.71 52%
43rd Ave 042-245-
040 Y Y Yes Y 0.05 5%
61 43rd Ave 042-245-
050 Y Y 1 65%
55 43rd Ave 042-245-
060 Y Y 0.46 65%
53 43rd Ave 042-245-
070 Y Y 1.26 65%
45 43rd Ave 042-245-
080 Y Y 1.42 65%
19 – Downtown
Cluster 487 S El Camino Real 034-144-
220 Y Y 0 0.9 93%
62 E 4th Ave 034-144-
230 Y Yes Y 1955 2.44 89%
E 5th Ave/San Mateo
Dr
034-144-
240 Y Yes Y 0 0%
Pioneer Ct
Multiple owners
2040 Pioneer Ct 039-060-
050 Yes Y 1960 Y 0.91 58%
2041 Pioneer Ct 039-060-
100 Yes Y 1961 Y 0.84 58%
2050 Pioneer Ct 039-060-
060 Yes Y 1961 Y 1 64%
2070 Pioneer Ct 039-060-
070 Yes Y Y 0.86 49%
2055 Pioneer Ct 039-060-
090 Yes Y 1957 Y 0.9 38%
2075 Pioneer Ct 039-060-
080 Yes Y Y 0.07 48%
Villa Plaza 4060 S El Camino
Real
042-241-
180 Yes Y 1990 Y 0.69 34%
Downtown
Parking Lots 5 N San Mateo Dr 032-312-
250 Y Yes Y - 0%
123 Baldwin Ave 032-312-
270 Y Yes Y 0.06 0%
117 Baldwin Ave 032-312-
150 Y Yes Y - 0%
26 N San Mateo Dr 032-312-
100 Y Yes Y - 0%
27 N San Mateo Dr 032-312-
070 Y Yes Y - 0%
ATTACHMENT 2

Address
Development
Type
Description
Originally
Proposed
Dwelling
Units
Approved
Dwelling
Units
% of Project
Residential
(approx.)
Base Zoning Approval Discretion CEQA
Lot
Size
(Acre)
Dwelling
Units per
Acre
% of
Base
Density
Existing Use Age of Existing
Building
Existing Building
# of Story FAR Improvement
to Land Ratio
480 E 4th Ave.
(Kiku Crossing)
Multi-Family
Demo surface parking lot (City-owned
parcel). Construct new seven-story,
100% affordable multi-family building
with a separate five-level parking
structure.
164 225 53%
CBD-S:

Commercial and
DT residential
CC approved. Permitted under applicable
code and policies. Applicant utilized State
Density Bonus
IS/MND 2.41 93 186% Two Public
Parking Lots N/A - No Building 0 0.0 0.0
Block 21
Mixed-Use
Demo existing retail and residential
structures (8 units). New mixed-use
building with office and residential uses.
68 111 33%
CBD-S:

Commercial and
DT Residential
CC approved. Permitted under applicable
code and policies. Applicant utilized State
Density Bonus
IS/MND 1.51 74 148%
Retail and
residential
structures (8
units)
1900 - 2002 2 0.5 0.4
477 9th Ave.

Mixed-Use
Demo existing commercial buildings.

New five-story office and residential
building.
120 120 80% E2-2: Office
PC approved. Project was appealed (based
on heritage tree removal). Then CC upheld
PC approval. Applicant utilized State
Density Bonus. SUP issued for residential
uses.

Cat Ex
(Infill) 1.6 75 150% Office 1980s 1 0.3 0.7
1919 O’Farrell
St.

Multi-Family
Demo existing office building. New five-
story residential apartment building. 48 49 100%
E1-1/R4: Office
with residential
overlay
PC approved. Permitted under applicable
code and policies. Applicant utilized State
Density Bonus
Cat Ex
(Infill) 0.71 69 138% Office N/A 1 0.1 0.0
401 Concar Dr.

Hayward Park
Mixed-Use
Demo surface parking lot at Hayward
Park Caltrain Station. New five-story
residential apartment building.
189 191 100% TOD: Mixed use
PC approved. Permitted under applicable
code and policies. Applicant utilized State
Density Bonus
Tiered off
of the Rail
Corridor
Plan EIR

2.82 68 136% CalTrain Parking
Lot No Building 0 0.0 0.0
303 Baldwin
Ave.

Mixed-Use
Demo existing grocery store. New five-
story mixed-use building with
commercial, office and residential uses.
63 64 40%
C1-2/R5:

Commercial
with residential
overlay
PC approved. Permitted under applicable
code and policies. Applicant utilized State
Density Bonus
IS/MND 0.93 68 136% Grocery Store 1956 1 0.4 0.3
1650 S.

Delaware St.

Multi-Family
Demo the existing office building. New
five-story, 73-unit residential apartment
building.
73 73 100% TOD: Mixed-Use
PC approved. Permitted under applicable
code and policies. Applicant utilized State
Density Bonus
Cat Ex
(Infill) 1.07 68 136% Office Before the 1980s 2 0.4 0.3 666 Concar Dr.

Mixed-Use
Demo existing shopping center. New
mixed-use buildings with commercial,
office and residential uses.
935 961 97% TOD: Mixed use
CC approved. Permitted under applicable
code and policies. Applicant utilized State
Density Bonus
EIR 14.51 66 132% Regional Retail 1969 - 1991 1 0.3 2.6 1 Hayward
Ave.

Mixed-Use
Demo existing commercial and
residential uses (5 units). New mixed-
use building with office and residential
uses.
18 18 77%
E2-1/R4: Office
with residential
overlay
PC approved. Permitted under applicable
code and policies. Applicant utilized State
Density Bonus
Cat Ex
(Infill) 0.29 61 122% Residential and
office 1938 1 0.4 0.1
S Delaware St.
at Landing Ave
(PA20-053)
Bay Meadows
Mixed-Use
New four-story mixed-use building on
MU2 Block with ground floor retail uses
and office above; and new four-story
mixed-use building on MU3 Block with
ground floor retail uses and residential
above.
57 67 15%
BMSP: Mixed-
Use per Bay
Meadows
Specific Plan
PC approved. Permitted under applicable
code and policies.

Tiered off
of the
Specific
Plan EIR

1.51 44 88% Vacant No Building 0 0.0 0.0
4 W Santa Inez
Ave.

Multi-Family
Demo two single-family dwellings.

Construct new four-story condominium
building.
10 10 100% R4: Multi-
Family Dwelling
CC approved. Permitted under applicable
code and policies.

Cat Ex
(Infill) 0.25 40 80% 2 single-family
dwellings 1950s 1 0.3 0.1
406 E 3rd Ave.

Mixed-Use
Demo existing commercial buildings.

New four-story office and residential
building.
23 25 14%
CBD-S:

Commercial and
DT Residential
PC approved. Permitted under applicable
code and policies. Applicant utilized State
Density Bonus
IS/MND 0.88 28 56%
Fast food
restaurant,
industrial/auto
uses
1990s 1 0.9 0.8
435 E. 3rd Ave.

Mixed-Use
Demo existing commercial buildings.

New five-story office and residential
building.
5 5 16%
CBD-S:

Commercial and
DT Residential
PC approved. SUP for off-site
construction. Applicant utilized State
Density Bonus.

IS/MND 0.25 20 40% Gas station 1980s 1 0.1 0.1
2988 Campus
Dr.

Multi-Family
Demo four office buildings on two sites.

New multi-family residential buildings
(townhouses) on two hillside parcels.
291 290 100% E1-1: Office
PC approved. SUP for residential uses.

Applicant utilized State Density Bonus
and SB 330.

IS/MND 15.45 19 38% Offices 1970s 3 0.3 0.3
ATTACHMENT 2

Multi-Family
Demo office campus. New multi-family
buildings with single-family, townhouses
and condominium units.
190 190 100%
Rezoned from
E1: Office to R3
multi-family
CC approved. PC approved PA
modification, which was then appealed.

CC upheld PC approval. Permitted under
applicable code and policies. Applicant
utilized State Density Bonus.

IS/MND 11.13 17 49%
Executive
business
park
1979 2 0.3 0.4
222 E 4th Ave.
(Draeger’s)
Mixed-Use
Demo existing grocery store. New
mixed-use building with retail (grocery),
office and 100% affordable residential
uses.
10 10 7%
CBD/R:

Commercial
with residential
overlay
CC approved. Permitted under applicable
code and policies. Applicant utilized AB
1763 (100% affordable), State Density
Bonus.

Tiered off
of the 2010
Gen Plan
EIR

1.13 9 18% Grocery Store 1997 2 1.3 0.8
2089 Pacific
Blvd.

Multi-Family
Conversion of 8 two-bedroom units into
16 studio units for a net increase of 8
units within an existing apartment
complex
16 16 100% TOD: Mixed-Use ZA approved. Permitted under applicable code and policies.

Cat Ex
(Existing
Facilities) 2.37 7 14% Apartment 2015 3 2.0 3.9

Building Division (650) 522-7172 · Code Enforcement Division (650) 522-7150 Housing Division (650) 522-7220 · Planning Division (650) 522-7212 · General (650) 522-7200

May 17, 2024
Dylan Casey, Executive Director
James M. Lloyd, Director of Planning and Investigations California Housing Defense Fund (CalHDF)
360 Grand Avenue #323
Oakland, CA 94610
Sent via email: [email protected], [email protected]
RE: CalHDF Comment Letter on City of San Mateo’s Revised 2023-2031 Housing Element Dear Mr. Casey,
This letter is in response to your April 23, 2024 correspondence (“Letter”) expressing concerns over the Revised 2023-2031 Housing Element (“Housing Element”) of the City of San Mateo (“City”). The City has considered all public comments in its iterative revisions to the Housing Element, which is scheduled for City Council adoption on May 20, 2024. The Housing Element was recommended for approval by the City’s Planning Commission on April 23, 2024. On January 19, 2024, the Department of Housing and Community Development (“HCD”) found it to be in substantial compliance with State law.

Governmental Constraints
Your Letter acknowledges that the Housing Element outlines many constraints on housing development but raises concerns that it fails to analyze how these constraints would affect the feasibility of housing developments, specifically regarding parking, fees, design standards, and voter approved growth limits.

Housing Element Sections 4.1 and 4.2 summarize the constraints analysis. Contrary to your assertions, the summary specifically addresses parking, fees, design standards, and voter approved density and height limits within the City (Measure Y). Furthermore, Sections 7.1 and 7.2 include several programs to address these constraints, and Appendix B contains an in-depth analysis. All of these programs were created with significant input from the public, housing advocacy groups, and HCD itself. HCD issued its substantial compliance letter based on these updates, including the analysis of and local efforts to reduce and/or eliminate the aforementioned constraints through firm commitments – such as reducing parking requirements and removing discretion through the adoption of objective design standards.

Regarding fees, the City concluded that fees of 7% or less of total cost of development is not considered a constraint. While your Letter takes issue with this conclusion, the Mitigation Fee Act (Govt. 66000 et seq.) requires impact fees to be based on nexus and proportionality requirements. Fee studies evaluate these requirements and explain what fees can be legally supported, and the City has typically adopted fees that are below the maximum of what could be assessed to reduce potential for fees to be a constraint on housing production and impact financial feasibility. Many housing and mixed-use projects around the City have been approved and successfully constructed, as outlined in Table 4 in the Housing Element. The Housing Element also includes a specific program to monitor fees, with a focus on reducing the per unit costs for housing developments:

H 1.17 - Permitting and Development Fee Review

CITY OF SAN MATEO

COMMUNITY DEVELOPMENT DEPARTMENT
330 W. 20th Avenue
San Mateo, CA 94403
www.cityofsanmateo.org
(650) 522-7000

Regularly review development application, building permit and impact fees to identify opportunities to reduce per unit costs for housing developments, with a focus on reducing per unit costs for small multi-family projects (Missing Middle).

Regarding Measure Y, the Housing Element contains a detailed analysis of the measure as a constraint, both in the main document and in Appendix B. Nevertheless, your Letter claims that the City does not analyze the magnitude of this constraint and incorrectly characterizes it as a non-governmental constraint. The Housing Element analysis focuses on reducing the constraints posed by Measure Y to the extent that the City has the ability to do so. The City may not take action in conflict with Measure Y without voter approval because Measure Y is a voter-approved initiative. Second, based on input from housing advocacy groups, the City Council, and HCD, Policy H 1.20 was developed specifically to address the constraints imposed by Measure Y and to create substantial housing capacity through the adoption of General Plan 2040 (which has since occurred as explained below) and placement of a measure on the November 2024 ballot to amend Measure Y. Third, a back-up action was included in Policy H 1.20:
e) If the Measure Y ballot initiative does not pass in November 2024, present alternative plans within six months to the City Council, including a plan for rezoning, to address the housing production constraint of Measure Y with an emphasis on higher densities in high and highest resource areas, and to add at least 1,700 units of new capacity around the City, thereby increasing the City’s RHNA buffer by at least 25%.

Realistic Development Capacity
Your Letter claims that the Housing Element capacity analysis using 75% and 90% of maximum density, which is based on trends and expected outcomes, needs further adjustments to account for land use controls, constraints, and availability of utilities.

Staff developed the methodology that was used in close coordination with HCD and based on the City’s actual history of approved densities. The thresholds of 75% and 90% represent a conservative approach, in that typical densities for residential and mixed-use pipeline projects were higher, as shown in Table 2 in Appendix C (included as an exhibit to this letter). Table 2 also shows that most sites are developed at more than 100% of capacity, through application of State Density Bonus law. The assumptions in the City’s methodology account for the land use controls and constraints, which would also be addressed through the programs to reduce or eliminate identified local constraints. Additionally, the availability of utilities is not an issue within the City as almost all sites are non-vacant infill and have existing utility services.

Crucially, on March 18, 2024, the City Council adopted Strive San Mateo General Plan 2040, which would create capacity for 19,764 new dwelling units around the City, if the voters approve an amendment to Measure Y this November. The Environmental Impact Report (EIR) for General Plan 2040 included extensive evaluation of utility availability and capacity and found that with the inclusion of appropriate policies and actions, sufficient utility capacity existed to serve the growth planned for in the General Plan. The General Plan EIR can be viewed here: https://strivesanmateo.org/environmental-impact-report-documents/. Thus, there is clear evidence in the record to support the finding that there is utility availability to serve many more than 7,015 new housing units (the City’s RHNA) by 2031.

In addition to the thorough analyses in the Housing Element in compliance with State law, and the adoption of General Plan 2040, the 10.3-acre site at 1770 S. Amphlett Blvd recently became a housing opportunity site with the closure of the San Mateo Marriott Hotel at this location. This site has a base density of 50-75 units/acre under current zoning and Measure Y. The Marriott site is not listed on the Sites Inventory and could further increase the City’s RHNA buffer. The City is planning to bring forward a land use map amendment, including the Marriott site, that could further increase the site’s density later this summer. Notably, this action would add more housing units than the additional capacity that would have been added by the City with the inclusion of the “High II” General Plan land use designation, which ultimately did not occur. Again, if the City Council approves this land use map amendment, this will further increase the buffer beyond the City’s allocated RHNA.

Furthermore, the City is also moving forward with yet another action to facilitate the development of housing in the City, in accordance with State law. A Housing Opportunity Overlay District (as required per Housing Element Policy 1.10) would allow the property owners of approximately 40 sites within the City to develop qualifying housing projects by-right without discretionary review. These are sites that were identified in previous housing elements but were not the subject of entitlement applications during the past housing cycle. The program in Policy H 1.10 is as follows:

H 1.10 – Establish By-Right Housing Designation for Prior Housing Sites Amend the Zoning Code to establish a By-Right designation for housing sites reused from prior Housing Elements for housing projects that propose a minimum of 20% affordable units. Zoning for these sites must be at least 30 units/acre to meet default density requirements for lower-income households per Gov. Code Section 65583.2(c).

Your Letter also references communications from the Housing Action Coalition (HAC), which were considered during the iterative updates to the City’s Housing Element and sites inventory methodology. The City has provided direct responses to HAC to clarify information and address misunderstandings in their letters. These responses are included in Appendix F of the Housing Element.

Finally, your Letter references a 2018 project and lawsuit as the benchmark against which to evaluate the City’s current analysis (CaRLA v. City of San Mateo (2021) 68 Cal. App. 5th 820). The ten-unit market-rate condominium project that was the subject of that litigation has since been approved. No other projects have since been denied by the City. Rather, the City has a strong track record of approving and facilitating housing development. This is borne out by the lengthy list of pipeline projects referenced in the table attached to this letter, as well as the examples of recently approved projects in the Housing Element. The City has also committed over $35 million dollars in land and funding to support the production of affordable housing in Downtown San Mateo. The detailed commitments in the Housing Element’s Goals, Policies, and Programs further demonstrate the City’s commitment to meeting local housing needs and affirmatively further fair housing. This is again further reinforced by the adoption of General Plan 2040, which adds over 19,700 housing unit capacity and doubles the base density of over 1,300 properties around the City.

We hope this additional information provides appropriate clarification about the methodology and approach used in the Housing Element, shows the City’s genuine intent to meet and exceed its RHNA obligations and meaningfully address local housing needs, and helps to alleviate your concerns. If you have any questions or would like to discuss, feel free to email me at [email protected] (please copy the City Attorney) or we can set up a meeting to talk.

Sincerely,
Zachary Dahl, AICP
Interim Community Development Director
Cc: Prasanna W. Rasiah, City Attorney
[email protected]
Exhibit 1 - Table 2 from Housing Element Appendix C
Address
Development
Type
Description
Originally
Proposed
Dwelling
Units
Approved
Dwelling
Units
% of Project
Residential
(approx.)
Base Zoning Approval Discretion CEQA
Lot
Size
(Acre)
Dwelling
Units per
Acre
% of
Base
Density
Existing Use Age of Existing
Building
480 E 4th Ave.
(Kiku Crossing)
Multi-Family
Demo surface parking lot (City-owned
parcel). Construct new seven-story,
100% affordable multi-family building
with a separate five-level parking
structure.
164 225 53%
CBD-S:

Commercial and
DT residential
CC approved. Permitted under applicable
code and policies. Applicant utilized State
Density Bonus
IS/MND 2.41 93 186% Two Public
Parking Lots N/A - No Building
Block 21
Mixed-Use
Demo existing retail and residential
structures (8 units). New mixed-use
building with office and residential uses.
68 111 33%
CBD-S:

Mixed-Use
Demo existing commercial buildings.

Cat Ex
(Infill) 1.6 75 150% Office 1980s
1919 O’Farrell
St.

2.82 68 136% CalTrain Parking
Lot No Building
303 Baldwin
Ave.

Mixed-Use
Demo existing grocery store. New five-
story mixed-use building with
commercial, office and residential uses.
63 64 40%
C1-2/R5:

Commercial
with residential
overlay
PC approved. Permitted under applicable
code and policies. Applicant utilized State
Density Bonus
IS/MND 0.93 68 136% Grocery Store 1956
1650 S.

Delaware St.

Mixed-Use
Demo existing commercial and
residential uses (5 units). New mixed-
use building with office and residential
uses.
18 18 77%
E2-1/R4: Office
with residential
overlay
PC approved. Permitted under applicable
code and policies. Applicant utilized State
Density Bonus
Cat Ex
(Infill) 0.29 61 122% Residential and
office 1938
Exhibit 1
Address
Development
Type
Description
Originally
Proposed
Dwelling
Units
Approved
Dwelling
Units
% of Project
Residential
(approx.)
Base Zoning Approval Discretion CEQA
Lot
Size
(Acre)
Dwelling
Units per
Acre
% of
Base
Density
Existing Use Age of Existing
Building
S Delaware St.
at Landing Ave
(PA20-053)
Bay Meadows
Mixed-Use
New four-story mixed-use building
g on MU2 Block with ground floor retail
uses and office above; and new four-
story mixed-use building on MU3 Block
with ground floor retail uses and
residential above.
57 67 15%
BMSP: Mixed-
Use per Bay
Meadows
Specific Plan
PC approved. Permitted under applicable
code and policies.

Tiered off
of the
Specific
Plan EIR

1.51 44 88% Vacant No Building
4 W Santa Inez
Ave.

Multi-Family
Demo two single-family dwellings.

Construct new four-story condominium
building.
10 10 100% R4: Multi-
Family Dwelling
CC approved. Permitted under applicable
code and policies.

Cat Ex
(Infill) 0.25 40 80% 2 single-family
dwellings 1950s
406 E 3rd Ave.

Mixed-Use
Demo existing commercial buildings.

New four-story office and residential
building.
23 25 14%
CBD-S:

Mixed-Use
Demo existing commercial buildings.

New five-story office and residential
building.
5 5 16%
CBD-S:

Commercial and
DT Residential
PC approved. SUP for off-site
construction. Applicant utilized State
Density Bonus.

IS/MND 0.25 20 40% Gas station 1980s
2988 Campus
Dr.

Multi-Family
Demo four office buildings on two sites.

New multi-family residential buildings
(townhouses) on two hillside parcels.
291 290 100% E1-1: Office
PC approved. SUP for residential uses.

Applicant utilized State Density Bonus
and SB 330.

IS/MND 15.45 19 38% Offices 1970s
1, 2 and 3
Waters Park
Dr.

CC upheld PC approval. Permitted under
applicable code and policies. Applicant
utilized State Density Bonus.

IS/MND 11.13 17 49%
Executive
business
park
1979
222 E 4th Ave.
(Draeger’s)
Mixed-Use
Demo existing grocery store. New
mixed-use building with retail (grocery),
office and 100% affordable residential
uses.
10 10 7%
CBD/R:

Commercial
with residential
overlay
CC approved. Permitted under applicable
code and policies. Applicant utilized AB
1763 (100% affordable), State Density
Bonus.

Tiered off
of the 2010
Gen Plan
EIR

1.13 9 18% Grocery Store 1997
2089 Pacific
Blvd.

Cat Ex
(Existing
Facilities) 2.37 7 14% Apartment 2015
Exhibit 1

San Mateo City CouncilMay 20, 2024

San Mateo City Council
May 20, 2024