Irvine Company’s 1,800 Units in Santa Clara Square Get City Council Approval

Opposition uses regional woes in desperate attempt to block a generous development offer

The Santa Clara Square mixed-use project is one of the most significant developments presently under construction in Silicon Valley. Its sheer size, 80 acres spread across a very desirable portion of Santa Clara that sits next to US highway 101, is equally met by its ambition to create a model of a new Silicon Valley—a truly urbanized, live, work, play multi-generational community.

On Tuesday, developer Irvine Company went in front of the city council to seek approval to commence the final phase of the development, which would include 1,800 housing units, 40,000 square feet of retail space, 4,500 square feet of leasing space and 38,000 square feet of amenity space. While the council adopted the proposed resolutions in a 5-2 vote to allow this development to move forward, the dissenting council members used a now-familiar rhetoric of traffic congestion and regional housing affordability issues as a way to pause development.

They did this in light of a generous package offered by Irvine Company to build and fund public park space, donate over $9 million to the school district and provide an overall benefits package worth in excess of $50 million to the city.

“This represents a $2 billion investment on behalf of the Irvine Company in Santa Clara,” said Carlene Matchniff, vice-president, entitlements and public affairs at the Irvine Company. “We’re really thrilled to be presenting what we believe to be a complete community that looks at planning for jobs, housing, services, shopping, dining and recreational opportunities for those who live in this community as well as other members of the Santa Clara city.”

The investment also includes a new hazardous materials truck to be provided to the city’s fire department, improvements along various trails in the city and a fully functional book van, among other things. Overall, the project is looking add nearly 6,200 permanent jobs in the city and 3,900 construction jobs.

When the project was initially conceived, the focus was primarily on the office development.

“Going back to 2009, [the development] was approved just above 2 million square feet, 13 or 14 story office towers and parking garages. I recall at that point in time the planning commission, a very insightful planning commissioner named Teresa O’Neill said, ‘Where’s the residential? We really need some residential to support this,’” said Kevin Riley, director of planning & inspection at City of Santa Clara who opened the presentation and gave the project a resounding recommendation on behalf of the city’s planning department.

Yet, in a bizarre twist, Teresa O’Neill, who is now one of the members of the city council and whose idea to bring residential units to the project has been followed came out as one of the project’s most vociferous opponents.

“There’s many aspects of this project that I really, really like, and I tremendously appreciate all the work that Irvine [Company] has done, but at this point for me the project is still not complete,” she said during her comment on the development.

She went on to tie the project to almost all of the region’s problems, like traffic and housing affordability and demanded that the transportation figures be doubled as a condition of her approval. “When you look through the EIR and comment letters that came in, there are many, many laudable features as council member Caserta mentions, but the areas where it fails, where there are unmitigated impacts with, you know, we’re going to have to do a statement of overriding circumstances with the traffic and the air quality in particular. So, to looking at those, and I have spoken with the city manager about it, and I’ve talked to everybody about that, you know, you look through all those diagrams, I mean, it’s, you know, we’re almost at gridlock, and I feel like first of all the transportation demand management plan is likely to be done, and it has a 20 percent goal, which is great, I mean it should be at least 40 percent. A lot of the other cities around us are asking that. I think Stanford’s is at 50 percent, you know, so talking about it, I just think if we don’t do these things now, we will be strangled,” she said.

Council member O’Neill then went on to set a new requirement for additional affordable units even though the city attorney confirmed that the city could not impose an affordability requirement for a rental project.

“It’s nice that we got a commitment for 100 units. That’s a beginning, but that won’t even make a dent in the minimum wage or barely above minimum wage workers that will be working at this complex,” O’Neill said. “We do have to take somewhat of a pause here to see if we can get those things in place.”

She was supported in her assertions by council member Debi Davis who was also concerned that the community outreach may not have been sufficient and even though a recommendation from the council to provide a mobile library, the book van, was followed, she was not happy that city would have to staff and maintain the vehicle.

“Even though we have a lot of good things in here, I think that it’s too much, too quick, too fast, and I understand there is that build out [to 2023], but I’d really [like to] have all that stuff in writing with the traffic plan,” she concluded.

Council member Lisa Gillmor went the furthest in her opposition, even moving to introduce four alternate motions that supported a requirement of additional affordable units, three times the proposed fee to support the school district, an increased assessment for core services at $2 million per year until full build out in 2023 and a higher transportation demand management plan.

All four were rejected by the council in a 4-3 vote.

Council members Caserta, Kolstad and Marsalli, along with Mayor Matthews, all lauded the Irvine Company in their willingness to work with the city to develop this project and to meet the demands of the city.

“Irvine [Company] has been overly generous. They’ve given the school district twice the amount of money they’re required,” said Pat Kolstad. “But the main thing for me—folks need a place to live, and this is going to provide a place for 4,000 people to live.”

Mayor Matthews supported this, adding that other municipalities, most recently the City of San Jose, had been critical of Santa Clara’s jobs to homes ratio. He said while these 1,800 units will not resolve some of these issues, it showed that the city is doing its part in promoting residential development and attempting to solve a regional problem that is plaguing the Bay Area.

Mayor Matthews also asked the representatives of the Irvine Company if they would be willing to add to the affordable unit count already proposed, and offered an off-site solution for a piece of land at the corner of San Tomas Expressway and Monroe Street, which the city had owned for some time.

“I think that if we could find a location off site that we could make it possible to do a tax credit subsidy program, which we couldn’t do on site. So, that gives us the flexibility to raise that [affordable unit number] to a higher percentage. We have that flexibility,” said Matchniff of Irvine Company, showing the developer’s willingness again to meet the council’s requests.

With that proposal settled, the Irvine Company had effectively agreed to raise the number of affordable units to 180. Sensing an agreement, Mayor Matthews moved the council to vote on the proposed resolutions, which after over two hours of debating and public comment passed 5 to 2.

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