SAN JOSE — Google has pushed ahead with efforts to salvage parts of older buildings as well as rescue complete historic structures that are within the footprint of the search giant’s downtown San Jose transit village.

The tech titan has offered the public pieces of the now-shuttered Patty’s Inn, whose roots as a downtown San Jose watering hole date back to the Great Depression.

Google also offered up for salvage sections of the former Sunlite Bakery Bread Depot building and will rescue the ornate entryway to the old structure, preserving the entrance elsewhere in the company’s project footprint.

Across the street from the bakery site, the old Hellwig Iron Works at 150 South Montgomery Street is expected to be preserved and creatively reused as a key component of Google’s new Downtown West neighborhood of office buildings, homes, shops, restaurants, hotel facilities, open spaces, entertainment centers and cultural loops.

“Google taking the time and opportunity to offer salvage of older buildings is commendable,” said Bob Staedler,  principal executive with Silicon Valley Synergy, a land-use consultancy. “It takes quite a bit of time and energy to make those salvage items available to the public. This effort shouldn’t be taken for granted.”

One of the numerous documents prepared in connection with the Downtown West proposal addressed Google’s plans to preserve several key buildings in the footprint of the game-changing project, where the search giant eventually intends to employ 20,000 to 25,000 tech workers.

The former Hellwig Iron Works building, constructed sometime around 1935, is one of the buildings that’s expected to be reused as it exists, although it’s likely some additions could be made to the structure.

After the ironworks closed its doors, Navlet’s Florists and a Taiko performance studio also operated in the distinctive brick building.

“150 South Montgomery Street, last occupied by San Jose Taiko, is being repurposed for adaptive reuse,” a Google spokesperson said.

It’s likely that the Hellwig Ironworks could be expanded as part of the building’s reuse, according to documents on file with city officials.

“One or more additions and adaptive reuse of the building to accommodate new arts and cultural uses” are envisioned as part of the Hellwig structure’s future, the city documents show.

Among the other historic or noteworthy buildings that are being retained, reused adaptively, or relocated:

• Kearney Pattern Works and Foundry at 40 South Montgomery Street, constructed in 1922. The historic sections of the building will be relocated about 30 feet to the south. “Once relocated, the building would be expanded and adaptively reused to accommodate new retail, cultural, arts, education, and/or other active uses,” the city report stated, with the new frontage on Montgomery Street. The non-historic portions of this building on South Autumn Street would be demolished.
• San Jose Water Works building at 374 West Santa Clara Street, constructed in 1934. The building is being preserved and renovated.
• Stephens Meat Co. “dancing pig sign.” Google removed and preserved the iconic sign that for decades was a fixture near the Diridon train station and the SAP Center. The sign, temporarily at San Jose History Park, will eventually find a permanent long-term home in the Downtown West project.
• Sunlite Bakery at 145 South Montgomery Street, constructed in 1936. Google has decided to rescue the Art Moderne-style entrance of the structure and relocate it elsewhere in the company’s new transit-oriented neighborhood.

The office building is slated to become “a cornerstone of the Downtown West neighborhood that we are developing,” Kent Walker, president of global affairs of Google owner Alphabet, said in April 2022 during a San Jose event to discuss the tech titan’s investments in the Bay Area.

The preservation of so many historic and existing prominent buildings will help Google’s new neighborhood to blend in with the existing areas on the western edges of downtown San Jose, in Staedler’s view.

“This shows a commitment to honoring the historical elements of San Jose while making way for the next evolution of the Diridon Station area,” Staedler said.

Alameda County DAis coddling criminals

It should not surprise anyone that Alameda County District Attorney Pamela Price dropped special circumstances against David Misch, one involving his alleged kidnapping and murder of Michaela Garecht in 1988, giving him the possibility of being paroled, instead of serving life in prison.

Soon after Ms. Price was elected, she said she would “seek to remove all 41 local cases from Death Row and to resentence people who were sentenced to life without parole.” She also said her “administration will begin an era of change that ultimately will make us (Alameda County residents) stronger and safer.” I beg to differ, not with the likes of Misch running around.

The voters and residents of Alameda County are being introduced to a new form of criminal justice — one that, in my view, is not going to keep them safe and favors the perpetrator.

Ninfa WoodWalnut Creek

Quarry plan willundermine rural road

The EBMUD plan to fill in the old quarry on Lake Chabot Road, located on county land between San Leandro and Castro Valley, with soil excavated during pipeline maintenance proposes to run 60 to 100 dump trucks a day along Lake Chabot Road for 40 to 80 years.

That’s right. If anybody now alive is here to see it, the site and adjacent hillside will eventually be seeded and planted with native plants.

Lake Chabot Road is currently closed because of landslides and erosion that have undermined the roadbed. It’s doubtful that it will ever be able to support the constant dump truck traffic.

Gary SloaneSan Leandro

Agencies must makebetter use of tax dollars

Re. “Prop. 13 proves costly to government programs,” Page A8, Jan. 13:

I disagree with the notion that local and state governments don’t have enough money already from other taxes and bonds for impoverished schools, understaffed government offices and infrastructure.

Our property taxes are plenty high in California and enough businesses have been run out of the state. We don’t need any more lost jobs and tax base.

The real problem is not a lack of funding but how all of these agencies use the money they have.

Herman BetchartFremont

Recount cost is worthelection integrity

The article “Are Alameda County elections actually headed to a recount?” (Page B1, Jan. 15) regarding “voters confusion about everything from the results of certain races to the future of ranked choice voting” helps me understand why people might question election results.

The District 4 Oakland Unified school board “snafu” demonstrates that our election systems are not infallible. That said, I believe that the seeds of doubt this might have cast is very troubling. The cost of letting any doubts remain will be much more costly to our society in the long run than any monetary cost of a recount now. We should not put a price on maintaining faith in election integrity.

Dennis CarlisleNewark

Predicting climate changeisn’t settled science

The National Oceanic and Atmospheric Administration (NOAA) recently stated to “Expect record-shattering hot years soon, likely in the next couple years because of ‘relentless’ climate change from the burning of coal, oil and gas.”

Last October, this same NOAA released its U.S. Winter Outlook. Researchers predicted that through February 2023, “California will still have to contend with the ongoing drought and won’t see much precipitation.” Wrong.

Scientists admittedly can’t predict hurricanes a year out with any accuracy, but they want us to believe they can predict global temperatures and sea levels years out. Real science is never “settled.”

Jon RegoClayton

]]> https://www.eastbaytimes.com/2023/01/16/letters-1119/feed/ 0 8717708 2023-01-16T16:30:41+00:00 2023-01-17T03:58:22+00:00 https://www.eastbaytimes.com/2023/01/16/is-the-bay-area-on-the-verge-of-a-housing-construction-slowdown/ https://www.eastbaytimes.com/2023/01/16/is-the-bay-area-on-the-verge-of-a-housing-construction-slowdown/#respond Mon, 16 Jan 2023 14:05:17 +0000 https://www.eastbaytimes.com/?p=8717316&preview=true&preview_id=8717316 The Bay Area, already one of the most difficult and expensive places in the nation to build new homes, is being buffeted by a turbulent economy that’s creating even more challenges for a region reeling from a housing affordability crisis.

The headwinds are plenty: Higher interest rates for construction loans. Rising labor and material costs. Slowing demand from homebuyers squeezed by more expensive mortgages. And fears of a looming recession as cities continue to recover from the pandemic.

That’s all raising the specter of a widespread housing construction downturn.

“There already is a slowdown, but I think it will magnify itself in 2023,” said Ken Rosen, chair of UC Berkeley’s Fisher Center for Real Estate and Urban Economics. “A lot of developers may put projects on hold until construction costs come down.”

The decline threatens to thwart the Bay Area’s effort to meet its state-mandated goal of approving more than 441,000 homes of all income levels over the next eight years, representing a roughly 15% increase in the region’s housing stock. Already, most cities and counties haven’t come close to meeting their individual targets in past decades. And housing experts and advocates contend that chronic underproduction — in part because many local officials have sought to limit growth — is at the root of the region’s astronomical rents and home prices.

Mathew Reed, policy director with Silicon Valley pro-housing group SV@Home, said the mounting economic uncertainty will require officials at all levels of government to remove barriers to development and unlock more money for desperately needed affordable homes.

“Because there are ongoing challenges, there’s a lot we can do that’s going to be critical in the longer term,” Reed said.

Signs of a homebuilding decline are already clear. From the start of last year through November, the San Francisco metro area — which includes the East Bay and Peninsula — permitted just over 10,000 homes, a 16% decline from the same period in 2021, according to U.S. Census Bureau data. The San Jose metro area, which has seen a spate of new housing planned for its urban center, actually saw permits increase from around 4,000 to 6,000 new units.

But just because projects have construction permits, that doesn’t automatically mean they’ll be built. In San Francisco, for instance, several of the city’s biggest housing developments are reportedly stalled. And in Concord, a 16,000-unit megaproject still in the planning stages is on hold after the developer asked the city to approve the addition of about 3,000 more homes to offset growing costs.

“You have deals going to the sidelines because of interest rates,” said Chris Neighbor, president of SummerHill Homes, which develops houses, condos and apartments throughout the South Bay.

The rising cost of borrowing has sent typical mortgage rates doubling over the past year, to 6.3% last week, boosting monthly home payments by thousands of dollars and pushing many would-be buyers out of the market. In turn, developers are increasingly pulling back on new single-family homes and condos.

On top of that, financing projects has become more expensive as rates for construction loans also have jumped to around 6%. Neighbor said that’s adding roughly $20,000 to the per-unit cost of large multimillion-dollar developments – a seemingly small amount that can still make all the difference.

“That just upended all of the financial models that determine whether or not something is a feasible project,” said Chris Thornberg, an economist and founder of Beacon Economics.

Another roadblock: swelling material and labor costs since the start of the pandemic. Neighbor said inflation and supply chain issues for lumber and other materials, coupled with worker shortages, have sent hard costs soaring by around 20% the past few years, though prices are now starting to stabilize.

The cost of ​lumber, which has been especially volatile during the pandemic, recently returned to pre-COVID levels. Prices averaged around $377 per thousand board feet this month, down from a peak of $1,495 in May 2021.

Dean Wehrli, a principal with John Burns Real Estate Consulting, said tens of thousands of local layoffs by tech companies such as Facebook, Twitter and Salesforce also are having a “big impact on housing demand,” giving developers pause. And growing concerns about a recession freezing the local real estate market later this year are only increasing the uncertainty.

At the same time, the slow pandemic recovery of the region’s urban cores has some developers questioning whether it makes sense to pursue projects in city centers, where rents largely haven’t returned to pre-COVID prices.

“Why would you want to live in a downtown if it is dark and empty and boarded up?” asked Danny Haber, chief executive of Oakland-based developer oWOW.

Meanwhile, affordable housing developers are facing yet another set of challenges. Most low-income projects rely on public subsidies that have become increasingly oversubscribed in recent years and could soon be on the chopping block amid economic uncertainty.

Last week, Gov. Gavin Newsom, facing a projected $22.5 billion deficit, released a new budget proposal calling for $350 million in reductions from the $11.2 billion set aside for affordable housing programs over the next few years.

“In the tough times, that’s where we’ll see how committed we are to addressing this crisis,” Diaz said.

Matt Regan, a housing policy expert with the pro-business group Bay Area Council, blamed cities’ sometimes yearslong approval process for adding crushing costs to both affordable and market-rate projects. Local zoning rules have also put overly strict limits on how many homes can go where, he said.

While the state and local governments have phased in reforms, more needs to be done to rebalance the housing market in the Bay Area, Regan said.

“If it’s not already a gated country club for millionaires,” he said, “it will become that very soon.”

The Pacific, as the residential project is known, is deemed to be in a prime location in downtown San Jose, and has received final city approval.

CBRE, a veteran commercial real estate firm, has been hired to market the choice property. CBRE executive vice president Jef Henderson and first vice president Jon Teel are leading the sales effort. CBRE executives Andrew Behrens and Jesse Weber are providing debt and finance expertise in the selling endeavor.

“This property is in the epicenter of growth and development in downtown San Jose,” Teel said.

The highrise housing is being eyed on a property that’s a former Greyhound bus terminal on the corner of South Almaden Avenue and Post Street.

Despite the apparent advantages of the site as a housing development, the project’s principal owner and developer, Z&L Properties, has yet to break ground.

“Putting the Greyhound station site on the market and a transaction to buy it is inevitable,” said Bob Staedler, principal executive with Silicon Valley Synergy, a land-use consultancy. “If you look at their track record, Z&L just doesn’t have the wherewithal to develop properties.”

The developer’s inability to break ground fits a pattern. Z&L Properties has struggled mightily with its Bay Area property portfolio, which is located primarily in downtown San Jose and San Francisco.

The China-based company has completed just one Bay Area project, a double-tower housing highrise in downtown San Jose near San Pedro Square with roughly 640 units. Only one tower is available for occupancy.

The company has also proposed a pair of housing highrises and the revamp and rescue of a historic church at 252 N. First St. in San Jose. Neither tower has been built and the old church is covered by a tattered black tarp.

In 2021, Z&L Properties yielded ownership of one of its development sites, a 1.6-acre property near the corner of Terraine Street and Bassett Street. Z&L’s plans for a big residential tower at that location had stalled.

An alliance led by global developer Westbank, local developer Gary Dillabough, and San Jose-based Terrascape — a firm headed by real estate veterans Tony Arreola and Mark Lazzarini — paid $11.4 million for the choice Terraine Street parcel. The property is in a downtown district known as the North San Pedro neighborhood.

The Greyhound terminal site that’s up for sale has received final approval from the city for the development of 708 housing units. The property has addresses ranging from 60 to 70 South Almaden Avenue in San Jose.

The attempt to sell the Greyhound site arrives at an uncertain time for Z&L Properties.

Zhang Li, a real estate tycoon and principal executive with Z&L Properties, was detained in London in December 2022 in connection with a U.S. investigation into possible kickbacks and bribery involving a project in San Francisco.

A court in London was told last month that Zhang was wanted in the United States over an investigation into the payment of bribes to San Francisco city officials linked to the granting of permits for a project in that city.

Despite the legal turmoil that swirls around Zhang, the prospects could be favorable for the bus terminal development site.

“As one of the most dense development sites” in downtown San Jose, “this will be the future anchor of a whole neighborhood spiraling around the old Greyhound site,” said Mark Ritchie, president of Ritchie Commercial, a real estate firm.

A new owner of the Greyhound property would control a site near and next to several office towers whose occupants might want to live near their workplace.

“You don’t want to have 50,000 people coming into downtown San Jose every weekday and then 50,000 people leaving every night,” Teel, the CBRE executive, said. “You want people to be able to live, work and play downtown.”

Among the existing and future office projects in downtown San Jose that could bolster the new housing development:

• Adobe is preparing to move into a new office tower at 333 West San Fernando Street where the tech titan would employ thousands.
• An office tower at 200 Park Avenue has been completed by veteran Bay Area development firm Jay Paul Co.
• Park Habitat, a tower with offices and gardens at 180 Park Avenue, has broken ground. Global mega-developer Westbank and local developer Urban Community are working to build this project.
• A mega campus bounded by Almaden Boulevard, West San Fernando Street, South Market Street and Park Avenue has been proposed by Jay Paul.

Google continues to push ahead with its development of a new neighborhood of office buildings, homes, restaurants, shops, entertainment sites, cultural loops and open spaces near the Diridon train station and SAP Center, where the search giant could employ up to 25,000 tech workers.

“The Greyhound site is a good location for residential,” Staedler said. “A larger residential population is desperately needed in downtown San Jose.”

And then the man who would step away from his world-famous Los Gatos restaurant on Jan. 1, after 20 years in business, talked of the diverse California culinary industry’s boundless potential, adding: “You haven’t seen the last from me yet.”

Already, his next chapter is unfolding.

Kinch and his business and bakery partners will create the first restaurants for the North 40, the massive housing development rising up in Los Gatos on the northwest corner of Los Gatos Boulevard and Lark Avenue.

Harmonie Park Development announced Wednesday that it has agreed to terms with MB Partners — “spearheaded by world-renowned chef David Kinch, award-winning baker Avery Ruzicka and entrepreneur Andrew Burnham” — to lease a 7,100-square-foot building at The Junction, the name selected for a 66,000-square-foot culinary and retail center that will serve residents of Los Gatos’ newest houses, condos and apartments.

At this site, MB Partners will open:

— Their second location of Mentone, the Kinch restaurant with a France-and-Italy-meet-on-the-California-coast focus that opened in Aptos in 2020 during the pandemic’s early days.

— Another Manresa Bread bakery, the second for Los Gatos. MB was launched in 2013 as farmers market stands by Kinch and Ruzicka so that locals could buy breads they had enjoyed at the restaurant. The first brick-and-mortar opened in 2015. There are currently five: the Los Gatos flagship, Campbell (both are all-day cafes), Los Altos, Palo Alto and Santa Cruz.

— A yet-to-be-announced restaurant concept.

“Not only are MB Partners industry luminaries, but more importantly they were home grown right here in Los Gatos,” Don Capobres, principal and CEO of Harmonie Park Development, said in the press release. “They represent the artisanal ethos we are cultivating at The Junction. We are delighted to partner with them.”

Besides a large culinary and retail hall, Harmonie envisions The Junction featuring plenty of open space, with community gardens and meeting places for residents.

The first phase of the North 40 project was approved by the Los Gatos City Council in 2017, after years of debate over housing plans for what was the city’s last walnut orchard.

Details: 15011 Los Gatos Blvd., Los Gatos; https://junctionlosgatos.com/

The tense standoff erupted in the pre-dawn hours of Aug. 3, when demolition crews quickly fenced in the park and downed dozens of trees on the university-owned site three blocks south of campus, which was once a center of 1960s political protest. Over two days, protesters foiled the university’s attempt to start construction on its controversial housing project for 1,100 students and 125 unhoused residents on the historic site.

By the early afternoon on Aug. 3, hundreds of police officers in full riot gear had retreated amid growing pushback from protesters, leaving dozens of people free to pry apart barricades, cut gas lines and puncture tires of heavy machinery left behind — the most recent chapter of a fiery history of activism on the land.

The havoc’s toll includes a whopping three-quarters of a million dollars to pay for the fencing that protesters ripped out of the sidewalks around the 2.8-acre park, but the biggest cost is $2.73 million to compensate law enforcement deployed at People’s Park, according to UC Berkeley spokesperson Dan Mogulof.

The police response at the park — bounded by Telegraph Avenue, Bowditch Street, Dwight Way and Haste Street — was led by University of California Police Department officers, with help from the California Highway Patrol and California State University officers. Mogulof said that $2.73 million includes outside officers’ room and board, physical security supplies and overtime for UC Berkeley police personnel.

Fortunately for the $312 million project, there’s already wiggle room baked into the budget that the University of California Board of Regents approved in September 2021.

The plan allocated nearly $52.8 million for contingency costs, which included “anticipated delays due to litigation or special considerations relating to clearing the site for construction,” according to documents from the UC’s Capital Strategies Committee.

Mogulof, who said he was not previously aware of those funds, could not confirm if that was where the $4 million from August’s protests would be sourced.

So why should the greater Berkeley community care that a $312 million UC housing project — complete with a dedicated contingency fund — will swallow an additional $4 million in expenses and ballooning interest costs during years of delays?

While no taxpayer dollars are at stake, Mogulof said the public should be concerned that a small group of people were able to temporarily shut down a project that has otherwise gleaned support from the Berkeley City Council and 68% of surveyed university students.

“UC Berkeley is a public institution, and the public has a vested interest in the fact that the university is a good steward of the funds they receive, from the public and elsewhere,” Mogulof said by phone Tuesday, adding that unforeseen expenses may put pressure on the prices students pay to live in the proposed facility.

“These costs were incurred because of unlawful behavior, and it raises the question: Who gets to decide? At the end of the day, somebody has to pay. It’s a hard pill to swallow when costs are the result of illegal activity.”

But many activists working to preserve the park are left wondering whether UC Berkeley reflected on where they went wrong in August, given the fact that they’re left with a “hefty price tag for nothing,” according to Andrea Prichett, a member of the People’s Park Council who was one of the protesters arrested for blocking the construction in August.

“When you spend $4 million and you have nothing to show for it, that’s a public policy problem,” Prichett said. “I would like to think that they would revise their approach in future, but unfortunately they have it in their minds that they can simply roll over this portion of the community and force their will upon people. It didn’t take a public policy expert to recognize that there was going to be resistance.”

Construction was approved in July by Alameda County Judge Frank Roesch, who rejected several lawsuits — filed jointly in 2021 by the Local 3299 union for UC service workers and two community groups, Make UC A Good Neighbor and Berkeley Citizens for a Better Plan — that argued the housing project violated the California Environmental Quality Act.

Redevelopment of People’s Park has remained on hold since August — at first to avoid further confrontation, but also because the university was hit with an injunction by a state appellate court. That same court appears to be on the brink of forcing UC to abandon its current plans at People’s Park.

In December, the First District Court of Appeal in San Francisco filed a tentative opinion that the University of California failed to offer a valid reason for why it did not analyze alternative locations, well-documented noise impacts and unintended population growth while developing a plan to build desperately needed homes on the historic 2.8-acre site.

Oral arguments for the case will be heard Thursday.

While the battle slogs through the courts, UC Berkeley is also on the hook to pay the project’s contractor delay fees, which are contractually required in order to compensate for costs that will be incurred while progress is stalled on the project.

Mogulof said that bill is currently $2.6 million and will continue to climb for as long as the delay continues.

The total price tag does not include the crews and equipment used to cut down several trees at the historic park, which was added to the National Register of Historic Places in June. Rather, Mogulof said those costs will be rolled into the larger project’s final bill, since those actions were already planned, regardless of any protests and damage.

More detailed financial information about the bills — from the toll of the construction equipment that was destroyed to the locations where officers were housed during the protests — is not yet available.

Moving forward, Mogulof said the university wants to start construction as soon as possible in order to complete the project and welcome new residents within two years, attempting to address the university’s student housing crisis.

About 82% of the more than 45,000 undergraduate and graduate students enrolled last fall were left to find off-campus housing — the highest percentage among the entire University of California system.

“The university’s commitment to the project is unwavering,” Mogulof said. “And we intend to proceed with construction as soon as we’re able to.”

If the state rejects Atherton’s updated plan — which also includes a property adjacent to Redwood City — it could lose local development control altogether, putting at risk the bucolic mansion-studded small-town vibe it’s worked years to preserve.

More commonly known as upzoning, some properties will be rezoned to allow more housing — a hot topic since the California HOME Act, which makes it easier for homeowners to subdivide an existing lot, went into effect at the beginning of last year. Gov. Gavin Newsom and legislators are pushing to increase the state’s supply of affordable, multi-family housing and slow-growth, but affluent Bay Area suburbs such as Atherton are pushing back.

Some have tried creative approaches to avoid increasing their housing density — Woodside, for example, declared itself a mountain lion habitat. But most have taken Atherton’s tack of assuaging pushback from residents about apartment construction in their neighborhood by relying on granny flats or school sites to try to meet the state-mandated construction of hundreds of new units of housing over the next eight years.

Tasked with where to put its 348 required new homes, Atherton leaders have spent the last year and a half squabbling with their super-rich neighbors over one plan or another. As council member Rick DeGolia put it: “Wherever you propose to do it, whoever lives around that area objects. That’s the constant we’ve experienced in the last year and three months.”

While spending months devising a plan that puts much of the new-housing burden on Menlo School, Menlo College and other public school sites within Atherton, the council had tried to avoid upzoning any of the town for multi-family housing.

But after the town’s housing consultant cautioned that their plan would likely be rejected by the state because it does not include multi-family zoning nor address homes for low- and very low-income families, council members went back to the drawing board to reconsider previously rejected drafts.

“I’ve lived in Atherton over 20 years, and I don’t want to destroy Atherton’s character, but the rationale is to look at locations that will have the minimal impact on the remaining town,” council member Elizabeth Lewis said. “We’ve really tried to not do a multi-family upzoning situation, but it looks like we need to take another look at our housing element before we submit.”

Atherton has until Jan. 31 to submit a housing plan to the state; if it’s rejected, the town will be subject to the “builder’s remedy,” which would allow landowners to build dense housing without the oversight or approval of local officials.

Already one homeowner on Oakwood Boulevard, near the border with Redwood City, has said he’s interested in building multiple units there, though some council members are wary that it will cause too much traffic in a part of town that’s dominated by single-family homes. If the state rejects Atherton’s housing plan, that could mean that owner could build a much denser project with no oversight from town officials. By zoning it as multi-family, the council believes they’ll have much more control on what gets built there.

“Personally I think that one of our best opportunities is 23 Oakwood with whatever clauses we want to put in to guarantee we’re going get something that helps meet our need,” Mayor Bill Widmer said.

The council also decided to upzone 17 houses along El Camino Real, from Stockbridge Avenue to the Redwood City border, for multi-family housing and single-family homes on smaller lots at the edge of a town predominated by acre lots with some of the Bay Area’s largest mansions — an area jokingly referred to as the “poverty pocket” by locals, despite the presence of multi-million-dollar homes.

But the council couldn’t agree on developing an acre-sized area in Holbrook-Palmer Park currently housing the chief of police in a historic 1930s Mediterranean-style home. The Holbrook-Palmer estate was donated to the town in March 1958 after the death of Olive Holbrook Palmer — but for recreational uses only. The town attorney said there’s a clause in the will that says if the town ever uses it for anything other than recreation — potentially including housing — ownership of the land would go to Stanford University.

While the council did manage to upzone parts of town, Councilmember DeGolia said he fears that no developer would be able to afford the pricey land, saying, “I don’t believe you can reasonably build affordable housing” in Atherton.

DeGolia said that what the town really needs to focus on is “housing for teachers and members of the community that need affordable housing,” and Widmer said the town should continue to pursue “activities over at the college” for housing and fill the “need for staffing housing here.”

But for housing advocates such as Jeremy Levine, the question for councilmembers is simple: “Is affordable housing possible in Atherton, and, if so, what can the city actually do to make it happen?”

The proposed development would be built at 5670 Camden Ave. in south San Jose, the city planning documents show.

The affordable housing project would consist of 136 residences and a self-storage center at that location, near the corner of Camden Avenue and Blossom Hill Road.

Three educational centers — Delight Montessori School San Jose, Beacon School and Cinnabar School — are located next to the site where the development would occur.

Two development firms, Santa Clara-based Roem Corp. and Insite Property Group, based in the Southern California city of Torrance, have teamed up to float the project proposal at San Jose City Hall.

John F. Font Ph.D. Associates and Beacon School currently own the property, a Santa Clara County property database shows.

The overall project site totals 10.7 acres, which includes the existing school site and the proposed locations for the affordable homes and the self-storage center.

The Roem and Insite development alliance intends to request that the city modifies the general plan for the parcel.

The preliminary proposal on file with the city is being floated as a way to gauge feedback from city political leaders, municipal staffers and the local neighborhood.

The neighborhood where the project could rise consists primarily of single-family homes and apartment buildings, although several neighborhood retail centers are in the immediate vicinity. Westfield Oakridge Mall, Almaden Plaza and Princeton Plaza Mall are a few miles away.

That’s done via land-use decisions that control how many housing units and commercial sites can be built in a given time. However, through a series of laws mandating new levels of density everywhere in the state, whether or not they are needed or justified, this key local power now belongs to largely anonymous state officials who know little or nothing about most places whose future they are deciding.

It’s being done through the elimination of single-family, or R-1, zoning. It’s being done via the new requirement that the state Housing and Community Development (HCD) Department approve housing elements for every locality. If HCD does not approve such a plan for a city, developers can target it with virtually no limits if they choose.

It’s all based on a supposed need for at least 1.8 million new housing units touted by HCD. This is despite the fact that the state auditor last spring found that HCD did not properly vet the documents and other instruments on which that estimate was based.

What’s more, only three years earlier, HCD was claiming more than 3.5 million new units were needed. Less than one-eighth of that figure have since risen, yet HCD has cut its need estimate considerably.

However, cities and counties must do what they’re told by this demonstrably incompetent agency or risk lawsuits and big losses in state grants for everything from sewers and road maintenance to police and fire departments. State Attorney General Rob Bonta even set up a new unit in his Justice Department to threaten and pursue noncompliant cities.

This leads localities to approve developments in ways they never did before, including some administrative approvals without so much as the possibility of a public hearing. It leads to the absurd, as with Atherton trying to get state approval of a plan forcing almost all local homeowners to create “additional dwelling units” on the one-acre lots long required in the city. That’s instead of building almost 400 townhouses or apartments in a town of barely 7,000 people.

And in Santa Monica, because the City Council didn’t get its housing element approved, developers can probably not be stopped as they make plans for at least 12 large new buildings. So much for bucolic seaside living.

Santa Monica is also an example of a city buckling to state pressure to allow huge projects opposed by most of its citizens, a majority of whom are renters. That city has done nothing to stop or alter the largest development in its history, to be built on a property at a major intersection now occupied by a grocery and several other stores.

Despite heavy community interest, evidenced by the more than 2,000 people on a Zoom call about the project last winter, the city will hold no public hearings and does not respond to most written communications from its citizens about the development. This is all because city officials fear the state will sue if it objects.

Several cities have begun to fight parts of today’s state domination of land use. Four Los Angeles County cities — Redondo Beach, Torrance, Carson and Whittier — are seeking a court order negating the 2021 Senate Bill 9, which lets single-family homes be replaced by as many as six units, with cities unable to nix any such project.

As city councils and county boards see their constituents objecting loudly to much of this, other lawsuits will inevitably follow. No one can predict whether or not courts will find that the state Legislature and Gov. Gavin Newsom have vastly overreached in their power grab, which is all for the sake of increased density and based on unfounded predictions by bureaucrats who answer to no one.

Thomas Elias can be reached at tdelias@aol.com. To read more of his columns, visit californiafocus.net online.

The building, located at 826 North Winchester Boulevard in San Jose, had been scheduled to be auctioned off on Jan. 6, but the sale was canceled on Dec. 29, soon after it landed two new loans.

The new loans provided a combined $1.23 million in financing to an affiliate headed up by Kenneth Ryan Koch, a Grass Valley resident.

Tengjun Wang IRA provided about $728,300 in financing for the property and Emerson Vista provided $505,000 in funding, documents filed on Dec. 15 with the Santa Clara County Recorder’s Office show.

A posting by the trustee in the pending foreclosure showed that the auction of the property was canceled as of Dec. 29.

A loan default notice that Socotra Capital, the principal lender for the property, had filed appears to remain in effect, however.

In December 2021, Socotra Capital provided a $6.45 million loan to finance the property. Until several days ago, Socotra was preparing to offer the property for auction or to seize it through foreclosure.

Since the start of the coronavirus outbreak nearly three years ago, the building has had a trio of owners and faced two foreclosure proceedings.

Numerous property transactions show that many investors still hunger for Silicon Valley office buildings despite current economic uncertainties.

Even so, the delinquent loans that have plagued the property are a reminder that more than a few commercial properties in the Bay Area are mired in financial woes.

The current string of owners for the property originated in the spring of 2020, a review of county real estate records shows.

Kenneth Colbert, a Redondo Beach-based real estate executive, paid $8.25 million for the building in March 2020. That was the first month of coronavirus-linked business shutdowns crafted to combat the spread of the deadly bug.

At the time of the purchase, a Colbert-headed affiliate obtained a $6.1 million loan to finance the acquisition.

Eventually, the property’s mortgage became delinquent and the building was auctioned off through a foreclosure proceeding.

In June 2021, a group headed by Los Gatos-based Sridhar Capital paid $2.9 million to buy the office building during the auction.

In December 2021, the affiliate headed up by Kenneth Ryan Koch paid $10.75 million for the property. At the same time, the Koch-led group also obtained the financing of $6.45 million from Socotra for the office building’s purchase.

Koch has not responded to requests from Bay Area News Group for comment regarding the situation.

Two of the recent owners of the property envisioned the 0.6-acre location as a site where housing development could occur.

In May 2022, Kenneth Ryan Koch’s group proposed a five-story mixed-use development that would have included housing.

The two mixed-use projects were never built. The city planning records indicate that neither proposal received municipal approval.

The office center, known as Winchester Professional Building, stands empty and is bordered by a chain-link fence. Graffiti mars multiple walls of the structure.