CITY OF SAN MATEO
CITY OF SAN MATEO
Agenda Report
City Hall
330 W. 20th Avenue
San Mateo CA 94403
www.cityofsanmateo.org
Agenda Number: 13 Section Name: NEW BUSINESS Account Number: 34-3133 File ID: 26-11574 TO: City Council
FROM: Alex Khojikian, City Manager
PREPARED BY: Community Development Department
MEETING DATE: October 5, 2026
SUBJECT:
1700 S. El Camino Real – Below Market Rate Alternative Plan – Approval RECOMMENDATION:
Adopt a Resolution to approve an alternative means of compliance with the City’s Below Market Rate Housing Program pursuant to Section VIII(d) of the Below Market Rate Guidelines for the proposed 441-unit housing development project located at 1700 S. El Camino Real (PA-2026-0025).
BACKGROUND:
Approval of an alternative Affordable Housing Plan does not constitute approval of the Project (as defined below). Rather, City Council action on the applicant’s request for alternative compliance with Below Market Rate Housing Program guidelines is necessary before the Project can move forward in the development review process.
City Below Market Rate Program Requirements
The City of San Mateo’s Below Market Rate (BMR) Program, which consists of an Ordinance (Municipal Code Section
27.16.050) and Guidelines adopted by resolution, requires housing projects with 11 or more units to include 15 percent of the units in the project as affordable to lower-income households (rental developments) and moderate-income households (for-sale developments).
Policy H 1.3 in the City’s 2023-2031 Housing Element called for alternative compliance options to onsite affordable units in development projects. On June 16, 2025, City Council adopted Resolution No. 72, amending “Section VIII – Alternatives” of the BMR Guidelines to include the alternative compliance options of Offsite Construction of Affordable Units (Sec. VIII(c)) and Applicant Proposed Alternative (Sec. VIII(d)). The BMR Guidelines are provided as Attachment 2.
A developer must propose the alternative in an Affordable Housing Plan for City Council consideration before the planning application is complete. To approve an alternative means of compliance, the Council must make findings, as specified in Section VIII(d) in the BMR Guidelines and as summarized below:
a. The number of affordable units provided shall meet or exceed the number required by the City’s BMR Program; b. The level of affordability provided is the same or lower than that required by the City’s BMR Program; c. If the alternative does not meet the requirements of (a) and (b), it will provide greater public benefit than that provided under on-site requirements, as specified [this finding is not applicable]; d. Financing or a viable financing plan, which may include public funding, is in place for the BMR units; and e. The alternative is consistent with the General Plan, Housing Element and the BMR Program.
The scope of this report is limited to City Council review of the Alternative Affordable Housing Plan submitted by the applicant for the proposed project located at 1700 S. El Camino Real (Project). This report does not contain a comprehensive review and analysis of the Project because this agenda item does not relate to Project
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entitlements. Accordingly, Council action on this agenda item is limited to considerations of the Project’s proposed alternative means of compliance with the City’s Below Market Rate Housing Program, not the planning application, which staff is still reviewing.
Project Description
In March 2026, JEMCOR Development Partners (applicant) filed a planning application under SB 330, seeking to demolish an existing five-story office building and associated surface parking to construct two separate eight-story apartment buildings, Building A and Building B, on a 3.1-acre site, located at the corner of El Camino Real and Borel Avenue (1700 S. El Camino Real). The neighborhood meeting for this application was held on March 17, 2026 ahead of the formal submittal.
The planning application (PA 2025-0025) includes a Site Plan and Architectural Review (SPAR), Site Development Planning Application (SDPA) and Vesting Tentative Map (VTM) in order to demolish the existing office building and construct the two new residential buildings. The site is designated as Mixed-Use High in the General Plan, which allows for up to eight stories and 130 units/acre. Once the application is deemed complete and environmental review is completed, the application will be scheduled for Planning Commission public hearing.
The larger of the two buildings, Building A, is a residential building with a total of 253 market-rate rental units. This building includes 136 one-bedroom units, 88 two-bedroom units, and 29 three-bedroom units, with amenities such as a gym, pool, two internal courtyards and 353 parking spaces. The second building, Building B, includes 188 rental-units and would be 100-percent affordable for senior citizens. This building includes 150 one-bedroom units, 28 two-bedroom units, and 103 parking spaces and various amenities similar to Building A.
As required by the City’s BMR Program, a project must provide 15 percent of the units in the project as affordable to lower-income renters. The BMR requirement for the market-rate development in Building A, which has a total of 253 units, is 38 lower-income rental units.
Applicant-Proposed Alternative
Using the Applicant-Proposed Alternative under Guidelines Section VIII(d), the applicant is proposing to fulfill the Project’s BMR requirements within Building B exclusively, where all 188 units would be deed-restricted affordable rentals for seniors. By offering 188 units of affordable senior housing, the applicant is exceeding the required 38 BMR units by 395- percent. The applicant proposed Affordable Housing Plan is attached as Exhibit A to the Resolution (Attachment 1).
Under Section VIII(d), an applicant may propose other ways to comply with the baseline requirement to provide 15 percent lower-income units on-site if City Council is provided with substantial evidence that the project will provide as many as, or more, BMR units at the same or lower income levels or will otherwise provide a greater public benefit than the baseline requirement.
To approve the applicant’s Affordable Housing Plan, the City Council must make all of the following five findings:
a. The number of affordable units in the proposed alternative plan must equal or exceed that required by the on-site requirement in the BMR Guidelines Section III.
By offering 188 units of affordable senior housing in Building B, the developer will be significantly exceeding the standard inclusionary requirement of 38 BMR units.
b. The level of affordability provided by each of the BMR units must meet the affordability threshold or lower affordability thresholds, as required under the onsite requirements in the BMR Guidelines Section III.
The affordable units in Building B will be offered to low-income senior households, which is the same level of affordability as required by the City’s BMR Program for rental units. c. If the Applicant-Proposed Alternative does not meet requirements in (i) and (ii), it will provide greater public benefit
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than that provided under the onsite requirement of the BMR Guidelines Section III.
This finding is not applicable because the Project meets the requirements of subsections (i) and (ii) as noted above, and furthermore, the Project will create a greater public benefit by providing more than triple the number of required BMR units and provide affordable housing for seniors in a high resource area in within the City which is consistent with Housing Element goals and Affirmatively Furthering Fair Housing (AFFH) objectives. d. The developer must demonstrate that a financing or a viable financing plan, which may include public funding, is in place for the Applicant-Proposed Alternative.
The applicant does not plan to use City or County funds. As proposed, the applicant plans to use private activity tax-exempt bonds to construction this portion of the Project. e. The Applicant-Proposed Alternative is consistent with the General Plan and Housing Element, and the provisions of the BMR Guidelines.
The applicant proposed alternative Affordable Housing Plan is consistent with the General Plan, Housing Element and BMR Guidelines because (a) it transforms a commercial parcel along El Camino Real into high-density housing, thereby matching the City’s vision for transit and commercial corridors; (b) the development project is designated by the California Tax Credit Allocation Committee as a High Resource neighborhood with strong access to public transit, jobs, etc.; (c) the development of 441 total housing units go toward the City’s Regional Housing Needs Allocation (RHNA) goals established in the Housing Element; and (d) 188 of the 441 total new units will be deedrestricted affordable housing for low-income seniors, which furthers Policy H1.18 of the Housing Element workplan, to Increase Senior Housing Production.
As outlined above, the proposed alternative Affordable Housing Plan complies with the City’s BMR Guidelines, Section VIII(d).
Next Steps
The Project was deemed complete on July 30, 2026. The City is currently in the process of preparing the Project’s Consistency Letter, which is due to the applicant by September 28, 2026. The Project is also subject to the California Environmental Quality Act (CEQA). As the lead agency, the City determined that the Project will be reviewed under CEQA Guidelines Section 15183, “Projects Consistent with a Community Plan or Zoning.” The City has contracted with an environmental consulting firm to prepare a CEQA analysis, and this work is in progress.
Following completion of the required environmental analysis and resubmittal of the Project application in response to the City’s Consistency Letter, the application will be scheduled for a public hearing before the Planning Commission, which is anticipated to occur towards the end of 2026. Public notification, including mailed notices to all properties within 1,000 feet of the site, will happen in advance of this public hearing.
If the Project is approved, a condition of approval will be added that requires the developer to execute and record a BMR Agreement with the City prior to issuance of a building permit. The agreement, which is a standard requirement for all projects subject to the City’s BMR Program, will ensure that the units provided to fulfill the BMR requirement will remain affordable and will be monitored by the City for compliance. A separate condition of approval will require that the building containing the market-rate units (Building A) will not receive a certificate of occupancy until the building containing the affordable units (Building B) has received a building permit and commenced with construction.
BUDGET IMPACT:
There is no impact to the General Fund associated with this report.
ENVIRONMENTAL DETERMINATION:
The approval of an alternative means of compliance with the City’s Below Market Rate Housing Program is not a project
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subject to CEQA, because it is an organizational or administrative activity that will not result in direct or indirect physical changes in the environment. (CEQA Guidelines Section 15378(b)(5).) The underlying Project will undergo its own environmental review under CEQA as part of the development review process.
STRATEGIC PLAN ALIGNMENT:
This Project supports the Housing initiative.
NOTICE PROVIDED:
All meeting noticing requirements were met. Consistent with SMMC Section 27.08.050, notices were sent to the following parties more than 10 days in advance of this City Council meeting:
• Property owners and tenants of property located within a 1,000-foot radius of the Project site; • The City’s Planning “Notify Me” email list; and
• The interested parties, which includes interested individuals who contacted the City and requested to be added to CITY OF SAN MATEO the Project notification list.
ATTACHMENTS
Att 1 – Proposed Resolution
Exhibit A - Affordable Housing Plan
Att 2 – Below Market-Rate Guidelines
STAFF CONTACT
Van Diggans, Housing Specialist II
[email protected]
(650) 522-7229