City Council OKS plan to combine condo and hotel
A new building combining hotel rooms with residential condominiums in one of San Jose’s most sought after neighborhoods will be the first of its kind in the city and in step with the vision considered for the area around Diridon Station.
The San Jose City Council has unanimously approved plans submitted by Dallas-based Kade Development to build a ninestory building — featuring a 303-room hotel and 19 condominium units on the top floors — on the corner of Stockton Avenue and Julian Street.
The development will be in one of the city’s most rapidly transforming areas, just blocks from the SAP Center, Diridon train station, bus rapid transit on the Alameda and Google’s proposed transit village.
Kade Development bought the vacant 0.86acre site from the San Jose Redevelopment Agency for $4 million in 2018, according to Santa Clara County property records.
“This is very exciting,” Mayor Sam Liccardo said during the council meeting. “I look forward to seeing the shovel hit the ground.”
Condominium residents and hotel guests will enter the building through separate lobbies but will share amenities such as an indoor pool and fitness center. A rooftop deck and common area on the building’s top floor will be reserved for condo residents.
The hotel will be dualbranded as a Courtyard and Residence Inn by Marriott.
The 19 condominiums will be one- and two-bedroom units ranging from 806 to 2,229 square feet. The building also will have a three-story underground parking garage with 129 spaces for residents and guests.
Erik Schoennauer, a land-use consultant representing Kade Development, said the project not only allows the developer to reap profits early from the sale of the condos but also achieves the city’s vision for the area around Diridon Station.
“The city’s Diridon Station Area plan envisions a vibrant urban, mixeduse environment bringing more people together doing different things and adding vitality to the public streets,” Schoennauer said. “This project fulfills that vision.”
The project will provide up to 50 new jobs and generate up to $2.4 million annually in new tax revenue for the city, according to Schoennauer.
In addition to the new building, the developer has vowed to install a new crosswalk at the intersection of Julian and Stockton and provide a new bike lane on the north side of Julian east of Stockton.
Flush with tech funding, nonprofit Housing Trust Silicon Valley on Monday launched its first call to developers to tap into a $150 million Apple Affordable Housing Fund to build subsidized homes and apartments in the greater Bay Area.
The money is the first release of Cupertino-based Apple’s $2.5 billion commitment to support residential projects in the region through a wide variety of programs and initiatives.
Housing Trust Silicon Valley CEO Kevin Zwick said the initial loans will be aimed at projects approved by local cities but needing extra funding to start construction.
“We’re really looking for projects that will have the most impact,” he said. “This will really move forward projects that otherwise wouldn’t happen.”
As the Bay Area’s booming economy and housing shortage have sent home and apartment prices to record levels, affordable housing developers have struggled to fund projects. State and federal grants often have been insufficient to buy Bay Area property and build subsidized units.
Apple stepped forward in November to support new, multi-family developments, first-time buyer assistance, affordable housing projects, homelessness assistance and other housing initiatives.
“Affordable housing means stability and dignity, opportunity and pride,”
Apple CEO Tim Cook said at the time. “When these things fall out of reach for too many, we know the course we are on is unsustainable, and Apple is committed to being part of the solution.”
Affordable housing developers face stiff competition for government funding, as well as high property costs to acquire land. Many projects stall while developers cobble together funds for financing and construction, advocates say. Winning local and environmental approval can also lengthen construction timelines and add substantial costs.
Michael Lane, deputy director of Sv@home, said developers of affordable projects typically need to tap funding from five to seven sources, including local, state and federal agencies. The new loans will allow developers to move more quickly, and simplify the process, he said.
“This flexible, local source is really needed,” Lane said. “It feels like you’ve got a friend at the local level.”
Zwick estimates as many as 50 developments in the Bay Area could qualify for the competitive funding.
“The need is so great,” he said.
The housing trust expects to identify between six and nine projects and extend about $50 million in loans, he said. The maximum loan amount will be $10 million, repayable over as long as 20 years.
The trust wants developments that are “shovel ready” — poised to start construction — by the end of 2021. The developments will support housing low and moderate-income residents, including families making up to 120% of the region’s median income. The new developments will have long-term agreements dedicating them as affordable housing units.
Developer applications are due March 24.
The trust plans totapinto the additional Apple funds for other loan and development programs, Zwick said.
Contact Louis Hansen at 408-920-5043.