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An all-affordable housing development in downtown Mountain View is a step closer to getting built while another lost millions in local and state funding after the developer cut the number of affordable units it plans to build.
The City Council unanimously approved a staff recommendation Tuesday evening to rescind $10 million for a planned housing development at 1012 Linda Vista Ave. and to divert some of the funding to Lot 12, a “shovel-ready” project that would construct 120 affordable homes on a city-owned parking lot at 444 Bryant St.
“This represents important progress on the Lot 12 project as well as realistic transfer of funds from one project to another to make our current affordable housing program work better,” Council member Pat Showalter said at the Oct. 14 meeting.
The Linda Vista project is being developed by Alta Housing, a Palo Alto-based nonprofit that develops and manages affordable housing. Earlier this year, Alta notified the city that the project was not feasible given current market conditions, even with the $10 million that the city had allocated to the project back in 2023, according to the council report.
To help the development pencil out, Alta plans to reduce the number of apartments from 70 to 53. The reduction in unit count has delayed the project, which is no longer on track to meet expenditure deadlines, the report said.
City staff recommended that the city rescind the $10 million allocation and direct it to other affordable housing projects in the pipeline. Alta can reapply for local funding in the future, according to the report.
A shovel-ready project
Similar to Linda Vista, the Lot 12 project, which is being jointly developed by Alta Housing and Related California, has also struggled with financial challenges. Last year, the city stepped in and helped close a $36 million shortfall after high interest rates and escalating construction costs threatened to derail the project.
Lot 12 is now back on track with construction anticipated to begin in January, according to the council report.
The project is a 120-unit apartment building that will serve low- and very low-income households. It will include units for people experiencing or at risk of homelessness and for those with developmental disabilities, the report said.
The city’s total commitment for the project is roughly $23.5 million, an amount that will not change even with Tuesday’s appropriation. The city shifted the mix of funding sources, adding state and federal grant money, including $3.2 million that had previously been allocated to the Linda Vista project, while reducing the city’s contribution of local funds.
“This adjustment maximizes the use of outside resources and preserves local funds for future projects in the pipeline,” the council report said, adding that Lot 12 was the most appropriate project to receive state and federal dollars because it is “shovel-ready.”
was the Lot 12 project the one was approved years ago, pre-pandemic, I think?
Where will the farmers’ market go?