The Los Gatos Community Alliance applauds the work Grosvenor has
done in reimagining their development plans for Phase II of the North
40. We recognize how far the proposal has come from its original
concept — just 200 units with 40 affordable and a hotel. The current
plan includes 450 housing units, with a total of 77 units proposed as
affordable — 67 of which are attributed to Eden Housing, a separate
developer operating on land deeded to them. The project also
includes a generously sized central public open space, open to all,
and a new public pavilion designed to be adaptable for a variety of
civic, community, and retail uses. In addition, there is 15,000 square
feet of commercial space intended to create vibrancy and a sense of
place.

We are pleased with this progress — but we are not satisfied.
The Phase II proposal still includes only 10 affordable units integrated
into the mixed-income portion of the Grosvenor development,
compared to 373 market-rate units. That’s just 2.7% affordable
housing based on the Town’s Below Market Price (BMP) Ordinance —
far short of the 20% standard. This low figure represents a missed
opportunity, especially considering that the 2040 Housing Element
designates this land as one of the most critical sites for affordable
housing in Los Gatos.

Let’s be clear: the Town’s certified 2040 Housing Element planned for
464 units on this site, 253 of which were expected to be affordable to
very-low and low-income households. The Eden Housing portion
accounts for just 67 of these, and the additional 10 proposed by
Grosvenor brings the total to only 77. This is a significant shortfall.
Because of this gap, the Town will now be subject to the State’s “No
Net Loss” requirement, which obligates the Town to rezone additional
land elsewhere — land that must also meet the State’s strict
standards for realistic redevelopment — to make up for the loss of
affordable capacity.

Grosvenor also claims that they meet and exceed the minimum
density requirement of 30 dwelling units per acre. However, this is
based on a redefinition of how density is calculated. Instead of using
the gross acreage, as clearly required in the 2040 Housing Element
certified by HCD — and applied consistently across all parcels in the
site inventory — Grosvenor uses net acreage, a smaller figure that
inflates their stated density. Based on the legally required calculation
using gross acreage, 464 units are required to meet the minimum
density standard — a figure Grosvenor narrowly misses with their 450-
unit proposal.

To be fair, Grosvenor has been transparent about concerns with
affordability assumptions. In a September 27, 2022 letter to the Town,
they warned that the Town’s goal for affordable units could not be met
under the then-current zoning of 20 dwelling units per acre. They
suggested that increasing the density to 30 units per acre might allow
for up to 130 affordable units if market conditions allowed them to
build more than the 200 units originally planned. The Town went
beyond that, increasing allowable density to 40 units per acre.
Grosvenor and Eden Housing then added 250 more units to the plan
— but still propose only 77 affordable units, well below both the
original 130-unit goal and the 253-unit expectation formalized in the
2040 Housing Element.

The Eden Housing component, it’s important to note, is a separate
project subject to its own development timeline and dependent on
securing a complex patchwork of public and private funding. Its
success is not guaranteed, and it should not be used to mask the lack
of affordability in the core Grosvenor development.

Grosvenor has also made much of the fact that this is not a Builder’s
Remedy project. But this claim deserves careful scrutiny. Their
position rests on a novel and questionable legal theory: that the
project is governed by the January 31, 2023 Housing Element — a
version that was never certified by the California Department of
Housing and Community Development (HCD) and therefore never
went into effect. In fact, HCD informed the Town of its noncompliance
prior to April 18, 2023, the date Grosvenor’s application was deemed
complete. If Grosvenor’s legal theory were valid, it would mean no
project in Los Gatos during that period could qualify for Builder’s
Remedy status — something we know is not true. Other projects have
invoked that status. Grosvenor should be accurate about the
compliance status of their 383-unit development. Claiming compliance
with a Housing Element that doesn’t comply with State Housing
Element Law is a real head-scratcher and makes us wonder why they
would make such an outrageous claim. We’ll save that for another
day.

So what will make us satisfied? Build more affordable housing. That
has always been the primary goal. We would like to see at least 130
very-low and low-income units — an increase of 53 units over the 77
currently proposed. This is a number that is more than reasonable to
achieve, especially given the material increase in market-rate housing
that will be developed across Phase I and Phase II.

Yes, Grosvenor has come a long way. But incremental improvement is
not enough in the face of a statewide housing crisis. This project was
always meant to be a cornerstone of our Town’s affordable housing
strategy. It’s time for Grosvenor and the Town to fulfill that promise.

We are pleased. But we are not satisfied