The Pleasanton City Council has approved a controversial plan to develop a high-density housing project on Hopyard Road near the Valley Trails neighborhood. The approval came despite neighborhood concerns over the project’s density, parking and an additional $250,000 potentially required from the city’s affordable housing fund.
During a nearly five-hour meeting on April 16, the council voted 4-1 to move forward with an amended version of the original proposal approved by the planning commission on March 13.
Catalyst Development Partners, LLC originally applied in 2022 with the City of Pleasanton to demolish Harvest Valley Christian Church and its adjacent daycare on Hopyard Road near the Valley Trails neighborhood. This proposal would have replaced the buildings with 57 attached condominium units consisting of 48 three-story townhomes and nine low-income apartments on the three-acre lot. The lower-income apartments would have met some of the city’s inclusionary zoning requirements.
By 2032, Pleasanton must meet its state-mandated Regional Housing Needs Allocation goal of 5,965 new units, 2,758 of which are targeted for lower-income households.
But a flood of requests from area neighbors asked for an alternative to the project, as many believed it would bring down property values in the area, increase traffic and harm the small-town feel of the city. In response, Catalyst reduced 55 units: 47 three-story townhomes and eight low-income apartments that can be rented or sold at the market rate of $375,000 per unit to low-income residents.
Under this agreement, the city would contribute $100,000 per unit to bridge the affordability mark of 100% AMI (Affordable Median Income), if the developer could not get the full $375,000 purchase price per unit. With this option, the city would provide deeper affordability by offsetting costs through the city’s Affordable Housing Fee subsidies.
City Manager Gerry Beaudin outlined the proposal to the council.
“The developer takes the project down to 100% AMI, essentially putting more money into the project, and then when the home is purchased, it would be purchased for 100% AMI and then we take our low-income funds and purchase the additional 20% AMI so it can be locked into 80% for decades to come,” said Beaudin. “It’s not money flowing to the developer; it is helping the homebuyer.”
Vice Mayor Julie Testa expressed concerns about putting dollars from the city’s $14 million affordable housing fund into a for-profit development.
“So, if we are considering putting these incredibly precious dollars into this project, are we allowed to ask to see the developers profits and loss?” asked Testa.
Beaudin said no, the law did not allow for the review of a developer’s profit margins.
“But the challenge of this application is really that the developer proposed a project and ultimately made modifications to address some neighborhood concerns,” Beaudin added. “By modifying the project, the affordability suffered … so in order to maintain neighborhood concessions, what we are trying to do now is put some affordability back into the project… That leaves us with a choice to get it back to the deeper affordability it was originally at or leave at 100%. It’s a policy question about getting eight units at 80% AMI, versus eight projects at 100% AMI.”
For many residents in the audience, the reduction in units was simply not enough.
“I’ve been here almost 50 years,” said Valley Trails resident Richard Martinetti. “And that project is like putting 10 pounds of something into a five-pound bag. You’re twisting everything to try and make it work … it’s not really feasible; it’s just not.”
Despite the project providing a yet-to-be-determined number of parking spaces, resident Marta Sada was unconvinced they would be sufficient.
“I live in Valley Trails,” she said. “My concern is mostly about parking … when you add over 100 cars coming into the (new) neighborhood, they are basically going to overflow into where I live.”
Kristin Springer, whose home is directly across from the planned development, told the council that while she was resigned to the project coming, she hoped they would choose the second, 55-unit option.
“I am one of the houses most affected by this project,” said Springer. “I’ve read the laws and I know what you are under … I ask that you not approve Option 1 (the 57-unit proposal) because that would be terrible for my property values and family. I ask you to look at Option 2. It’s going to be hard for the community (to) accept it, but I also know if we can bring teachers into the community…if that’s an option we can consider, it makes me feel better.”
Mayor Karla Brown asked Bruce Myers, senior vice president/principal at Catalyst Development Partners, who was at the meeting, if he could reduce the project from three stories to two.
“Unfortunately, there is a numbers game we are trying to play as the developer on this project, not the least of which is based off of the general plan and zoning issues, which are already in place,” said Myers. “The developer did not propose the designation. In fact we are arguably doing less than we could on the site.”
“And if we flat-out reject it?” asked Brown.
“Well, that puts us in a difficult position,” Myers answered. “I hope you can see by my efforts thus far on the project, that the last thing I am trying to do is threaten the city, but if push comes to shove, well, it’s certainly on the table … I am trying to avoid that by everything I have done already within my power.”
During a five-minute recess, Beaudin met with the developer to try and negotiate a lower baseline for the council to support the project. In the end, the motion passed 4-1, with the agreement that $250,000 from the city’s affordable housing fund would help backfill any gaps should the housing price not perform at $375,000 based on 100% AMI. The deal would also sunset in five years from the date the permits were pulled.
Testa was the dissenting vote.
“I don’t think it is appropriate to put our affordable housing dollars into a for- profit project and I don’t understand why the risk falls to the city, as opposed to the developer who is benefiting so much from the state laws, so no,” she said.
