Planning and Building Agency
www.santa-ana.org/pba
Item # 21
City of Santa Ana
20 Civic Center Plaza, Santa Ana, CA 92701
Staff Report
October 20, 2026
TOPIC: Density Bonus Agreement No. 2026-03 – Watermarke Sandpointe Mixed-Use Development (200 East Sandpointe Avenue) – Continued from August 4, 2026
AGENDA TITLE
Density Bonus Agreement No. 2026-03 – Watermarke Sandpointe Mixed-Use Development (200 East Sandpointe Ave.) – Continued from the Regular City Council Meeting of August 4, 2026, Item No. 30)
RECOMMENDED ACTION
1. Adopt a resolution approving Density Bonus Agreement No. 2026-03; RESOLUTION NO. 2026-XXX entitled A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA ANA APPROVING DENSITY BONUS AGREEMENT NO. 2026-03 FOR A MIXED-USE DEVELOPMENT WITH 400 UNIT RESIDENTIAL UNITS, INCLUDING 20 UNITS PROPOSED AS AFFORDABLE TO EXTREMELY LOW-INCOME HOUSEHOLDS, AND 13,887 SQUARE FEET OF COMMERCIAL SPACE FOR THE PROPERTY LOCATED AT 200 EAST SANDPOINTE AVENUE (APNS: 411-111-07, 411-111-09, 411-111-10, AND 411-111-11)
2. Authorize the City Manager to execute a Density Bonus Agreement with CM Sandpointe, LLC, GH Sandpointe, LLC, JMT Sandpointe, LLC, and QC Sandpointe, LLC, with a 55-year covenant term, for a rental residential development consisting of a 400 unit multi-family residential development, including 20 affordable units (five percent (5%) of the total units) proposed as affordable to extremely low-income households, at the property located at 200 East Sandpointe Avenue (Agreement No. A-2026-XXX); and
3. Determine that, pursuant to the California Environmental Quality Act (CEQA) and the CEQA Guidelines, the recommended action is exempt from further review under Sections 15183 and 15162.
GOVERNMENT CODE §84308 APPLIES: Yes
Density Bonus Agreement No. 2026-03 – Watermarke Sandpointe (200 East Sandpointe Avenue)
October 20, 2026
EXECUTIVE SUMMARY
CM Sandpointe, LLC, GH Sandpointe, LLC, JMT Sandpointe, LLC, and QC Sandpointe, LLC (“Owner”), represented by Jonny Schneider (“Applicant”) and Pamela Sapetto and Andrea Maloney of Sapetto Real Estate Solutions (application-listed contact persons), request City Council approval of Density Bonus Agreement (DBA) No. 2026-03 pursuant to Article XVI.I (Density Bonus) of the Santa Ana Municipal Code (SAMC) and Government Code Section 65915 to facilitate redevelopment of surface parking and existing office building at 200 East Sandpointe Avenue.
This matter was continued from the August 4, 2026, City Council meeting and is the fifth public hearing on the Project. Senate Bill 330 (Government Code Section 65905.5) limits qualifying housing development projects to five hearings, including Planning Commission and City Council hearings and continuances. Accordingly, the City Council must take action during its October 20, 2026 consideration of the item; no additional hearings may be required for Project approval.
The Applicant’s preliminary application under Government Code Section 65941.1(a) was deemed complete on November 27, 2024. The four prior hearings were:
• March 9, 2026 and May 11, 2026 (Planning Commission)
• July 7, 2026 and August 4, 2026 (City Council)
The Project would redevelop the existing surface parking area and demolish the existing office building to accommodate a mixed-use multifamily development consisting of 400 rental apartment units, including 20 units reserved for extremely low-income households, and approximately 13,887 square feet of ground-floor commercial space.
The Applicant requests approval of a Density Bonus Agreement (DBA) pursuant to Government Code Section 65915 to memorialize the Project’s affordable-housing commitment and applicable development standards. The Project will reserve 20 dwelling units (five percent (5%) of the total units) for extremely low-income households, thereby qualifying for benefits under State Density Bonus Law. However, the Applicant is not requesting a numerical density bonus, incentive or concession, or waiver or reduction of development standards. Accordingly, no Planning Commission action was required with respect to the DBA because the Project did not require approval of any Density Bonus Law benefit within the Commission’s purview. In accordance with Government Code Section 65915, the City’s discretion and ability to deny a Density Bonus Agreement are severely limited if the project satisfies the objective standards set out by the State.
Staff recommends approval of the request, as the Project is consistent with the General Plan, will add 400 units to the City’s housing stock, satisfies inclusionary housing Density Bonus Agreement No. 2026-03 – Watermarke Sandpointe (200 East Sandpointe Avenue)
October 20, 2026
requirements through on-site affordable units, reinvests in an underutilized site, and would not result in adverse environmental or public health impacts.
Planning Commission Action
On May 11, 2026, the Planning Commission held a public hearing for the Project and voted 6:0:1, with Commissioner Oliva absent, to approve Conditional Use Permit (“CUP”) No. 2025-16 for proposed multifamily development and commercial uses, based on the required findings. Density Bonus Agreement No. 2026-03 was not considered by the Planning Commission, as no concessions or waivers were requested requiring documentation in a DBA pursuant to SAMC Section 41-1607. In accordance with SAMC Section 41-1602(d), approval of the DBA is under the jurisdiction of the City Council.
City Council Action
On July 7, 2026, the proposed Density Bonus Agreement was scheduled on the City Council consent calendar. At the meeting, the Council continued the item to August 4, 2026, to allow additional time for Council members to meet with staff and obtain further information about the project. On August 4, 2026, the City Council continued the item to October 20, 2026, following community and Council concerns regarding parking, affordable housing composition, and workforce requirements. The applicant has made no changes to the Project, nor provided new information on workforce, since it was agendized for the August 4, 2026 hearing.
DISCUSSION
Table 1: Project and Location Information
Item Information
Project Address and
Council Ward 200 East Sandpointe Avenue – Ward 4
Nearest Intersection Main Street and Sandpointe Avenue
General Plan Designation District Center – Medium Low (DC-1.5) Zoning Designation Hutton Centre Mixed Use Specific Development District – Specific Development No. 76 (SD-76), Zone 1
Surrounding Land Uses North Multifamily Residential, Office, Restaurant East Hotel and Surface Parking
South Manufacturing, Wholesale, Warehouse, Office, Parking Garage West Single-Family Residential across Main Street
Property Size 5.37 acres (233,831 square feet)
Existing Site Development 158,178 sq. ft. (gross floor area) eight-story office building and surface parking Use Permissions Multi-Family Residential, Live-Work, Retail and Service (permitted under SD76, Zone 2, as part of SB 330 request) Zoning Code Sections
Affected Uses SD-76, Section 7, #5; SAMC Section 41-593 and 41-638(a)(1); Article XVI.I (Density Bonus) Density Bonus Agreement No. 2026-03 – Watermarke Sandpointe (200 East Sandpointe Avenue)
October 20, 2026
Project Description
The Applicant proposes a two-phase multi-family mixed-use development incorporating rental apartments and ground-floor commercial units. Upon completion of both phases, the Project will include a total of 400 residential units and approximately 13,887 square feet of commercial space. Phase 1, located on the western portion of the site, includes redevelopment of the existing surface parking area with 224 apartment units, 5,818 square feet of ground-floor commercial space, and a structured parking facility, while retaining the existing eight-story office building. Phase 2, located on the eastern portion of the site, includes demolition of the existing office building and construction of 176 apartment units and approximately 8,069 square feet of commercial space.
The Project’s residential component consists of a mix of studio, one-, and two-bedroom units ranging in size from approximately 576 square feet to 1,115 square feet offered in seven different floor plan layouts. Some residential units will feature private balconies or patios to enhance building articulation and provide additional outdoor living space for residents. The proposed residential density is 74.5 dwelling units per acre (du/acre), which is below the permitted maximum density of 90 du/acre.
The Project features a contemporary architectural style consistent with multi-family and mixed-use developments currently under construction throughout Santa Ana and the surrounding region. Building massing is articulated through varied wall planes, material transitions, and six plaster color tones. Exterior materials include metal trim, railings, and awnings, horizontal wood-like cement panels, metal panels, vertical cement board siding, and glass railings. Ground-floor commercial frontages incorporate curtain wall glazing, muted black-and-white brick veneer, and taller ceiling heights for greater transparency into the spaces. A mural wall is proposed to wrap the corner of the commercial area near Main Street by the western courtyard.
The Project provides approximately 85,960 square feet of common open space, representing 37 percent (37%) of the site area. Open space amenities include landscaped courtyards and private balconies and patios for select residential units. Although not all units include private balconies, every resident gains access to generous common open space distributed site-wide, offering seating, landscaping, and massing breaks, with select areas designed for public accessibility. The highly amenitized resident-only space on Level 7 of the parking structure provides substantial recreational and social opportunities that fully compensate for any lack of private outdoor areas on select units.
This space is designed for social and recreational use and features a 1,873-square-foot clubroom and a 2,476-square-foot fitness space with showers and restrooms, fitness, and yoga facilities. The rooftop amenity deck also includes an outdoor swimming pool and spa, cabanas, outdoor dining areas with barbeques, dining tables, trellised shade structures, lounge seating, lounge chairs, daybeds, and a fitness lawn. Lighting at the amenity deck will be conditioned to be equipped with dimmers and light shields, and fixtures shall be directed downward and away from adjacent properties to minimize spillover and glare.
Density Bonus Agreement No. 2026-03 – Watermarke Sandpointe (200 East Sandpointe Avenue)
October 20, 2026
At the ground level, publicly accessible open space along Sandpointe Avenue will feature retail plazas with decorative accent paving, pedestrian lighting, and a variety of seating options. The resident-only east courtyard will provide additional recreational opportunities, including outdoor dining areas with barbeques, a game garden, a movie screen, a bocce ball court, and a shaded olive grove. Additional ground-level resident amenities will include a 735-square-foot business lounge, dedicated dog park and dog spa, with lighting integrated throughout the resident courtyards, public plazas, and common open space areas.
Density Bonus
Under California Density Bonus law, developers proposing five or more residential units are allowed to seek increases in base density for providing on-site housing units in exchange for providing affordable units on site. To help make constructing on-site affordable units feasible, the law allows developers to seek up to five incentives/concessions and an unlimited number of waivers. The incentives/concessions are generally reductions in site development standards or modification of zoning code requirements or architectural design requirements, and waivers are essentially variances from development standards (a site or construction condition). The purpose of the State Density Bonus Law is to encourage the development and availability of affordable housing. Pursuant to California Government Code sections 65915 (d)(1) and 65915 (e)(1), the Density Bonus Law does not provide a local jurisdiction with general discretion to deny these benefits based on policy preferences or because a project does not comply with development standards that are subject to an authorized incentive, concession, or waiver.
The City’s authority to deny a requested incentive or concession is expressly limited by Government Code Section 65915(d)(1). The City must grant a qualifying incentive or concession unless it makes a written finding, based upon substantial evidence, that: (1) the incentive or concession does not result in identifiable and actual cost reductions consistent with State Density Bonus Law; (2) the incentive or concession would have a specific adverse impact upon public health and safety or on property listed in the California Register of Historical Resources, and there is no feasible method to satisfactorily mitigate or avoid that impact without rendering the development unaffordable to low- and moderate-income households; or (3) the incentive or concession would be contrary to State or federal law.
The City bears the burden of proof to support denial of a requested incentive or concession.
Similarly, Government Code Section 65915(e) prohibits the City from applying a development standard that would physically preclude construction of a qualifying development at the densities or with the incentives or concessions permitted under State Density Bonus Law. A requested waiver or reduction may be denied only under the limited circumstances specified by State law, including where the waiver would result in a specific adverse impact upon health or safety for which there is no feasible method to satisfactorily Density Bonus Agreement No. 2026-03 – Watermarke Sandpointe (200 East Sandpointe Avenue)
October 20, 2026
mitigate or avoid the impact, would adversely affect property listed in the California Register of Historical Resources, or would be contrary to State or federal law.
State law also limits the information a local jurisdiction may require from an applicant in connection with a density bonus request. Government Code Section 65915(a)(2) provides that a local government shall not condition the submission, review, or approval of a density bonus application on preparation of an additional report or study that is not otherwise required by State law. The City may require reasonable documentation necessary to establish the Project’s eligibility for the requested density bonus and applicable parking ratios. In addition, reasonable documentation may be required to establish eligibility for an incentive or concession or to demonstrate that the requested incentive or concession satisfies the statutory definition. However, the City may not shift its statutory burden to the Applicant by requiring additional studies or analyses merely to establish that the City should approve a benefit that State law otherwise requires it to grant.
Due to the Project’s five-percent (5%) affordability rate, the developer can seek one density bonus incentive/concession and unlimited waivers, pursuant to Section 65915 et al. of the California Government Code (Density Bonuses and Other Incentives). In addition, California Assembly Bill No. 2345, approved September 28, 2020, revised the State Density Bonus Law originally adopted in 1979 to provide additional benefits for projects that include qualifying affordable housing. For this Project, the developer is not requesting State density bonus benefits in the form of additional units, incentive/concessions, or waivers as part of the Project. The Density Bonus Agreement is now before the City Council for approval and memorializes the Project’s affordability requirements. The Project has been analyzed for areas of potential impact, and conditions of approval proposed for the Project are intended to address any potential impacts.
Onsite Parking
The Project proposes to utilize the State’s parking ratios for qualifying affordable housing projects pursuant to Government Code Section 65915(p), which require a maximum of one space per studio and one-bedroom unit and 1.5 spaces per two-bedroom unit. This reduction in parking standards is permitted by State Density Bonus Law and does not constitute an incentive/concession or waiver.
At full buildout, the Project will provide a total of 718 parking spaces, exceeding the overall requirement of 516 spaces by 202 spaces. The residential component requires 447 parking spaces pursuant to California Government Code Section 65915(p), which establishes the applicable parking ratios for qualifying affordable housing developments.
The commercial component requires 69 parking spaces based on a ratio of five spaces per 1,000 square feet of floor area.
Density Bonus Agreement No. 2026-03 – Watermarke Sandpointe (200 East Sandpointe Avenue)
October 20, 2026
Table 2: Required Parking Comparison
Standard Parking Ratio Parking Calculation / Spaces Required Residential
Studio 1.0 space 1 x 29 units 29
One-Bedroom 1.0 space 1 x 277 units 277
Two-Bedroom 1.5 spaces 1.5 x 94 units 141
Retail /Service
5 spaces per 1,000 sq. ft (13,887 sq. ft. x 5) /1,000 69 Residential 447
Commercial 69
State
Density
Ratios
TOTAL Required
Total 516
Residential
Unit 2 spaces 2 x 400 800
Guest 10% of required unit spaces 10% x 800 80
Retail / Service
5 spaces per 1,000 sq. ft. (13,887 sq. ft. x 5) /1,000 69 Residential 880
Commercial 69
SD-76
TOTAL Required
Total 949
Residential
Unit 1.0 space 1 x 400 400
Studio 1.0 space 1 x 29 units 29
One-Bedroom 1.0 space 1 x 277 units 277
Two-Bedroom 2.0 spaces 2 x 94 units 188
Guest 25% of unit + bedrooms spaces 25% x 894 224
Retail /Service
5 spaces per 1,000 sq. ft (13,887 sq. ft. x 5) /1,000 69 Residential 1,118
Commercial 69
Multi-Family
Parking
TOTAL Required
Total 1,187
The Project is not anticipated to have any parking impacts. Moreover, the adjacent Sandpointe neighborhood includes existing permit-parking restrictions, including portions of Murphy Avenue and Birch Street immediately west of the Project site, as well as additional permit-parking streets located north of MacArthur Boulevard. These existing restrictions are intended to manage on-street parking demand and help preserve parking availability for neighborhood residents. However, to proactively address any neighborhood parking impacts that could result from the Project, the conditions of approval require a post-occupancy parking utilization survey and provisions requiring ongoing parking management practices throughout the life of the Project, including measures such as:
• Requiring onsite parking permits (such as stickers or hang-tags) for any parking in the onsite parking spaces for both residents and guests; • Policies for maximum time vehicles may be parked in the surface parking spaces, including any guest parking;
• Requiring that overflow parking be directed to available spaces at the 6 Hutton Centre Drive (Griffin Towers) and 203 East Sandpointe Avenue garages; • Policies for towing unauthorized vehicles, vehicles parked in unauthorized locations (such as fire lanes), vehicles parking in surface guest parking without a sticker, hang- Density Bonus Agreement No. 2026-03 – Watermarke Sandpointe (200 East Sandpointe Avenue)
October 20, 2026
tag, or other identifiers, and vehicles parked longer than any maximum guest parking timeframes allowed; and
• Routine garage inspections to ensure garage is available for vehicle parking.
Collectively, these design and operational measures ensure that the Project is compatible with its surroundings and will not be detrimental to the health, safety, or general welfare of nearby residents or workers.
Affordable Housing Opportunity and Creation Ordinance
The Project meets the affordable housing goal for the rental category of the City’s Affordable Housing Opportunity and Creation Ordinance (AHOCO) by providing 20 onsite units designated for households earning 30 percent (30%) of the AMI (extremely lowincome), which is currently set at $50,750 for a four-person, significantly enhancing the opportunity for income eligible Santa Ana households to rent a home in the City at a lower cost. The units will be dispersed throughout the community. These affordable units will consist of one studio, 14 one-bedroom, and five two-bedroom units, ranging from 576 to 1,115 square feet in size and will contain full kitchens, bathrooms, and open/common (living) areas. The developer’s Inclusionary Housing Plan has been reviewed and approved by the City’s Housing Division.
Table 3: Affordable Unit Breakdown
Unit Type Units
Affordable
Units in
Project Percent of Unit Type
Studio (576 sq. ft.) 1 29 3%
One-Bedroom (710-735 sq. ft.) 14 277 5%
Two-Bedroom (1,067-1,115 sq. ft.) 5 141 4%
Total 20 400
Public Notification and Community Outreach
As the City Council's approval of this agreement does not constitute a public hearing, no public notification or community outreach is required under applicable state law or local ordinances prior to Council action. However, staff notes that project notifications were posted, published, and mailed in accordance with City and State regulations for the required Planning Commission public hearing. In addition, staff contacted the provided contacts for the Sandpointe Neighborhood Association to ensure they were aware of the project and Planning Commission public hearing.
ENVIRONMENTAL IMPACT
Pursuant to the California Environmental Quality Act (CEQA) and CEQA Guidelines, the Applicant submitted CEQA analysis for a project consisting of 400 dwelling units, 13,887 square feet of commercial space, and eight levels of parking. The City retained Ascent Environmental, Inc. to conduct an independent peer review, which concluded that the analysis and findings are adequate to support the City’s determination. The Project was Density Bonus Agreement No. 2026-03 – Watermarke Sandpointe (200 East Sandpointe Avenue)
October 20, 2026
subsequently revised to remove one dwelling unit, redesignating it as a residential amenity/business lounge, remove basement parking, and to provide five percent (5%) affordability for extremely low-income households. Because the Project does not increase the project footprint or building envelope and is equal to or less intensive than the project originally analyzed, the environmental analysis remains valid.
The Project qualifies for exemption from further environmental review under Sections 15183 and 15162. Section 15183 applies to projects consistent with the General Plan or zoning where redevelopment impacts have been adequately analyzed for the area, while Section 15162 applies when a previously certified Program Environmental Impact Report (Program EIR) adequately analyzed the environmental effects of an activity and no new significant impacts would result from the proposed Project.
The Project is within the scope of the 2022 Santa Ana General Plan EIR (SCH No. 2020029087). CEQA Guidelines Section 15162 prohibits a subsequent or supplemental EIR unless: (1) substantial changes are proposed in the project; (2) substantial changes occur in circumstances under which the project is undertaken; or (3) new information of substantial importance becomes available. The Project is consistent with the land use designation analyzed in the General Plan EIR. No supplemental or subsequent EIR is required because: (1) the amendment will not require major revisions of the EIR; (2) there have been no substantial changes with respect to circumstances under which the General Plan was approved that will require major revisions; and (3) no new information, which was not known and could not have been known at the time the EIR was certified as complete, has become available. The prior EIR adequately describes the environmental setting, impacts, and mitigation measures. Therefore, a Notice of Exemption, Environmental Review No. ER-2024-45, will be filed for the Project.
FISCAL IMPACT
There is no fiscal impact associated with this action.
EXHIBITS
1. Resolution – Density Bonus Agreement
2. Draft Density Bonus Agreement
3. Site, Architectural, and Landscape Plans
4. May 11, 2026 – Planning Commission Staff Report and Exhibits (hyperlink) Submitted By: Ali Pezeshkpour, AICP, Executive Director of Planning and Building Agency and Sylvia Vazquez, Deputy City Manager/Acting Executive Director of Community Development Agency
Approved By: Alvaro Nuñez, City Manager