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CITY OF SAN MATEO
RESOLUTION NO. _______(2026)
MAKING FINDINGS PURSUANT TO HEALTH & SAFETY CODE SECTION 33433 AND APPROVING A DISPOSITION AND DEVELOPMENT AGREEMENT FOR A 71-UNIT RESIDENTIAL AFFORDABLE HOUSING BUILDING AND ONE OFFICE/RETAIL COMMERCIAL BUILDING LOCATED AT 445 SOUTH B STREET (APNS 034-179-010, 034-179-020, 034-179030, 034-179-040, 034-179-050, and 034-179-060)
(PA-2023-012, 445 SOUTH B STREET, “BESPOKE” MIXED USE PROJECT) WHEREAS, on January 4, 2021, the City Council approved Resolution No.3 (2021) declaring the City-owned parking at East 4 th Avenue and South Railroad Avenue (APNs 034-179-050 and 034-179-060, herein referred to as the “Property”) as “surplus land” and subsequently released a Notice of Surplus Lands Availability to all housing developers that have registered with the State Department of Housing and Community Development (HCD); and WHEREAS, on April 19, 2021, the City received four proposals for the acquisition and development of the Property, including a proposal from the three-party Development Team composed of Prometheus Real Estate Group and Harvest Properties (collectively referred to as “Commercial Developer”), and Alta Housing (“Residential Developer”); and
WHEREAS, on October 4, 2021, the City Council approved the City entering into an Exclusive Negotiating Agreement (ENA) with DTSM Housing, LLC for the redevelopment of the Talbot’s Lot; and WHEREAS, the City, the Commercial Developer, and the Residential Developer desire for the Development Team to construct a mixed-use development that incorporates the adjacent parcels on the block (which are partially owned or controlled by the Parties) totaling 239,628 square feet and consisting of one seven-story, 76,072 square- foot affordable housing building that includes approximately 5,964 square feet of ground floor community space (“Residential Improvements”);one six-story, 162,926 square-foot office/commercial building (“Commercial Improvements”); and an underground parking garage, located at 445 South B Street (collectively referred to as the “Project”); and
WHEREAS, the Applicant submitted a formal Planning Application (PA-2023-012) on February 24, 2023 with the Planning Division for a Disposition and Development Agreement, a Development Agreement, Site Plan and Architectural Review, Special Use Permit, and Site Development Planning Application associated with the Project in the City of San Mateo; and
WHEREAS, the City Council held two separate public study sessions, on May 15, 2023 and September 16, 2024, to review the proposed term sheets associated with the development agreements required for the proposed Project; and
WHEREAS, the Planning Commission held a public hearing for the Project on April 28, 2026, duly noticed, at which all public comments were considered, and by a vote of 5-0-0, recommended that the City Council adopt a Resolution to approve the Site Plan and Architectural Review, Special Use Permit, and Site Development Planning Application subject to the listed Findings for Approval and Conditions of Approval for Planning Application No.
PA-2023-012 and adopting the Initial Study/Mitigated Negative Declaration and Mitigated Monitoring and Reporting Program for the Project; and
WHEREAS, per the terms of the Disposition and Development Agreement (“DDA”), the City will ground lease the Talbot’s Lot to the Residential Developer; enter into a Lot Tie agreement and a Reciprocal Easement agreement with the Commercial Developer and any other fee owner of a portion of the Commercial Property to facilitate development of the Project across parcels under separate ownership; enter into other agreements with the 660\14\5003594.1
Residential Developer and Commercial Developer associated with the development and ongoing operation and maintenance of the Project; and provide a loan of three million dollars ($3,000,000) for construction of the Residential Improvements; and
WHEREAS, in accordance with Health & Safety Code Section 33433, the City has prepared a Summary Report for the disposition of the Property, formerly held by the Redevelopment Agency of the City of San Mateo, which contains the project costs and revenues to the City from the proposed transaction and determines the reuse value of the property.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SAN MATEO, CALIFORNIA HEREBY FINDS AND RESOLVES THAT:
1. Pursuant to Health & Safety Code Section 33433 and the Summary Report attached hereto as Exhibit A, the City finds that:
a. The lease of the Property will assist in providing housing for lower-income households. b. The lease of the Property is consistent with the implementation plan of the former Redevelopment Agency of the City of San Mateo adopted pursuant to Section 33490 because it authorized the use of redevelopment agency funds for lower-income housing and will assist in the elimination of blight. c. The consideration to be provided by the Residential Developer is not less than the fair reuse value at the use and with the covenants and conditions and development costs authorized by the lease because the reuse appraisal demonstrates that with these restrictions, the reuse value of the Property is less than zero.
2. The Disposition and Development (DDA) with AH Bespoke LP and DTSM Housing, LLC (attached herein as Exhibit B), which authorizes the execution of a Ground Lease, Lot Tie Agreement, Reciprocal Easement Agreement, Predevelopment Loan Agreement, and Permanent Loan Agreement is hereby approved.
3. The City Manager is authorized to execute the DDA in substantially the form attached. The City Manager is authorized to approve and execute future revisions to the DDA with the concurrence of the City Attorney, so long as the changes do not materially alter substantial rights and obligations of the City.
4. The City Manager is authorized to negotiate and execute a shared parking agreement consistent with the terms of the DDA, subject to the approval of the City Attorney.
5. The City hereby grants and accepts the reciprocal easements depicted in the form of Reciprocal Easement Agreement attached as Exhibit G to the DDA, and such grant and acceptance of easement is to be effective upon execution of the Reciprocal Easement Agreement.
6. The City Manager is authorized to approve and execute any other documents required by the City implementing the provisions in the DDA, subject to the approval of the City Attorney. 660\14\5003594.1
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Exhibit A
33433 Summary Report – TO BE INSERTED
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Exhibit B
DDA – TO BE INSERTED