April 12, 2023
Tr
udi Ryan, Director
Community Development Department
City of Sunnyvale 456 W. Olive Street Sunnyvale, CA 94086 RE
: Initiation Request for an Amendment to the Downtown Specific Plan for Subblock 6 of Block 18 Dear
Ms. Ryan:
Over the past 8 years, Sares Regis and Hunter Properties have steadily worked with the City to transform Block 18 of Sunnyvale’s Downtown into a first-class destination for both existing residents and visitors alike. In particular, we have worked with the City to create six separate and distinct subblocks in order to implement the Downtown Specific Plan (“DSP”) goal of creating a “vibrant, pedestrian friendly environment” with a “re- established street grid [that] will restore the historic pedestrian connections.” The following is a partial list of our collective accomplishments since 2015:
• Completed entitlements and commenced construction of 479 apartments, a new Redwood Square, and 30,000 SF of new retail in an iconic building on Block 3 South, including 52 new affordable homes; • Completed construction, and commenced and continued operation, of the new AMC Theater and Whole Foods Market on McKinley Avenue;
• Completed infrastructure within and around Block 18, including the extension of Murphy Avenue; • Completed the installation of new public art within Block 18; • Completed 199 new apartments in Buildings D, E, and F, including 25 new affordable homes; • Completed 75 new apartments at the F-1 property on Iowa St, including 9 new affordable homes; and • Completed entitlements and commenced construction on 500,000 SF of new office and 50,000 SF of new retail on Block 3, including the payment of over $7.4 million in community benefit funds and $3.7 million in housing mitigation fees.
While the work elsewhere on Block 18 is also significant and ongoing, we want to improve our plan for the critical link to historic Murphy Avenue on the approximately 3.9 acres that comprise Subblock 6 to maximize activity and energy that will further support local merchants and retail businesses.
We are therefore pleased to formally request that the City initiate a DSP amendment process for Subblock 6 pursuant to Municipal Code Sections 19.92.020 and 19.92.040(a) allowing for minor changes to the overall Block 18 Land Uses and Development Intensities and height requirements set forth in Table 5-1 of the DSP, along with conforming changes to the previously approved CityLine Development Agreement associated with Sub-blocks 1, 3, and 6, dated September 30, 2020 (the “DA”).
1 1 In addition to initiation of a Specific Plan Amendment, we also request that the City initiate any and all other conforming amendments to the General Plan, DSP, DA and Sunnyvale Municipal Code that are ultimately determined to be necessary or desirable in order to fully implement the scope of development outlined above, including as the development may be refined in response to City and other feedback during the course of the entitlement review process.
Attachment 2
The proposed design refinement will create a development plan for Subblock 6 that accounts for the economic shifts that have occurred since the pandemic, while at the same time meeting the City’s vision and goals outlined in the DSP for a vibrant, walkable, high-quality Downtown.
To achieve this vision, we request that the City Council allow a balanced development on Subblock 6 consisting of residential units on the southern portion of the block consistent with what is currently being developed on Subblock 3 and 205,000 square feet of mixed-use office space (retail on the ground floor and office above), along with a minor height adjustment allowing up to 85 feet of height on the northern portion of Subblock 6 (75 feet is currently permitted in that location, while 85 feet is currently permitted on the southern portion of Subblock 6).
This increase in office density also allows us to transition 22,103 square feet of 2nd story space in Subblock 3 that was originally designated as flex space in our entitlement to office space going forward. We have spent the last several years exploring various retail options for this space, to no avail. Unfortunately, the market has moved away from second story retail as a viable leasing option, as evident by the fact that there are few, if any, 2nd story retail projects being entitled in the Bay Area. It is critically important for us to make the right decision on this space otherwise it could negatively impact all the lease up of the Downtown; thus, we believe it’s imperative that we move forward with this office designation immediately so that we can set the market at ease and promote an inviting and fully activated retail environment for Downtown.
As an alternative to initiating a Specific Plan Amendment, the City could also approve the required heights, number of residential units, and mixed-use office square footage through a focused DA amendment, as authorized by Section 5.2.3 of the Downtown Specific Plan, and we would equally be supportive of that approach.
We look forward to the City’s approval of this request for Subblock 6, and to working with you and other downtown stakeholders to help the Sunnyvale’s Downtown continue to realize its fullest potential.
Sincerely,
De
ke Hunter Dave Hopkins
On be
half of STC Venture Block 6, LLC
Attachment 2