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Planning commission supports huge Middlefield Park mixed-use project despite concerns over Google's affordable housing proposal

Applicants Google and LendLease want to give the city land for affordable housing rather than build it themselves

A rendering of the Middlefield Park Master Plan shows buildings with offices, residential and retail space surrounding a public park in Mountain View's East Whisman neighborhood. Courtesy Google.

The Mountain View Environmental Planning Commission threw unanimous support behind the latest iteration of the Middlefield Park Master Plan's huge mixed-use development, despite concerns about Google's affordable housing proposal.

Applicants Google and LendLease first submitted an application for the Middlefield Park Master Plan in September 2020. The project proposes up to 1,900 high-density residential units, 1.3 million square feet of office space, 50,000 square feet of ground floor commercial space (including 20,000 square feet reserved for underserved small businesses) and multiple public parks.

Included within the proposed 1,900 housing units are 1,520 market rate units and 380 affordable units. The applicants said it's financially infeasible for them to build inclusionary affordable units, so they proposed an alternative: Rather than building the affordable units themselves, Google and LendLease would give Mountain View ownership of 2.4 acres of land. The city would then partner with an affordable housing developer – and be responsible for finding funding – to build the units.

The city hired Seifel Consulting to evaluate this alternative mitigation plan, which must offer to do more to further affordable housing than if affordable housing was integrated into the project, as so-called inclusionary units. The city requires projects to make at least 15% of the proposed units affordable and inclusionary, so an alternative mitigation plan must offer more than that.

The applicants estimated that 380 affordable units could be built on the 2.4 acres they propose to deed to the city, Mountain View Senior Planner Lindsay Hagan said at the EPC’s Oct. 19 meeting. But the city’s consultant estimated that closer to 338 units would fit – especially if those units had higher bedroom counts, which is essential for making the housing suitable for families.

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Either way, Hagan said, there’s sufficient land to accommodate the number of units required for an alternative mitigation plan. Even if the city can only build 338 units on the deeded land, that’s still more than 15% of the total units proposed, she said, meaning the project offers greater benefits than inclusionary units.

But the discrepancy between the applicants’ numbers and the consultant’s numbers still raised concerns for some commissioners. Vice Chair Joyce Yin suggested that the city talk to affordable housing nonprofits to see how many units could reasonably be built on the 2.4 acres. Commissioner Alex Nunez said the city should conduct a risk assessment to better understand how much funding it will take to actually get 300-plus units built, even with the land being free.

Staff and the consultant both maintained that while funding is always a challenge, the plan was feasible.

“We never know what it’s going to take to get these delivered, but the fact that this land is getting dedicated to the city …, that the city can do what it would like to do on it with respect to affordable housing, I think makes a significant difference in mitigating the risk, because the city is in control and can try to address whatever risks occur,” a representative of Seifel Consulting said.

EPC Chair Bill Cranston told the Voice that he spoke with a below market rate housing developer to gauge what it would take to get these units built.

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“His answer was, ‘Land’s a good thing. I can work with land,’” Cranston said.

The main challenge would be securing enough state funding, according to the developer, Cranston said.

“There’s a certain amount of money in the state for below market rate housing and everybody wants it,” Cranston explained. “What they (developers) have seen in the past is the state is reluctant to put all of the money into one project. They like more medium-sized projects, all over the place.”

Given this trend, projects with 90 to 100 units are the “sweet spot” for securing state funding.

“Since you’re looking at between 338 and 380 units, they may have to go back and apply for two or three years in a row to get enough money, if there’s no other money out there,” Cranston said.

But, he added, there could be other funding options outside of the state, like the Santa Clara County bond Measure A, or a future bond measure.

While there’s still a lot of unknowns on the affordable housing front, Cranston said he has more confidence in getting housing built in the East Whisman Precise Plan, which encompasses the project area, than he does in North Bayshore, the sprawling office park by Google headquarters slated for massive future housing development.

“Because (North Bayshore) is all controlled by Google, if they say, ‘Let’s build it,’ it’ll happen. If they don’t, then it gets slower,” Cranston said. “The difference with East Whisman is there are multiple land owners. The fact that we’re not dependent on the economics of one company … I think that’s part of the reason why we’re seeing East Whisman projects proposed relatively quickly.”

The EPC unanimously supported recommending the Middlefield Park Master Plan to the Mountain View City Council, on the condition that the council get more information about the mix of bedrooms and number of affordable units that could potentially be built on the deeded land.

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Malea Martin
Malea Martin covers the city hall beat in Mountain View. Before joining the Mountain View Voice in 2022, she covered local politics and education for New Times San Luis Obispo, a weekly newspaper on the Central Coast of California. Read more >>

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Planning commission supports huge Middlefield Park mixed-use project despite concerns over Google's affordable housing proposal

Applicants Google and LendLease want to give the city land for affordable housing rather than build it themselves

by / Mountain View Voice

Uploaded: Mon, Oct 24, 2022, 1:36 pm

The Mountain View Environmental Planning Commission threw unanimous support behind the latest iteration of the Middlefield Park Master Plan's huge mixed-use development, despite concerns about Google's affordable housing proposal.

Applicants Google and LendLease first submitted an application for the Middlefield Park Master Plan in September 2020. The project proposes up to 1,900 high-density residential units, 1.3 million square feet of office space, 50,000 square feet of ground floor commercial space (including 20,000 square feet reserved for underserved small businesses) and multiple public parks.

Included within the proposed 1,900 housing units are 1,520 market rate units and 380 affordable units. The applicants said it's financially infeasible for them to build inclusionary affordable units, so they proposed an alternative: Rather than building the affordable units themselves, Google and LendLease would give Mountain View ownership of 2.4 acres of land. The city would then partner with an affordable housing developer – and be responsible for finding funding – to build the units.

The city hired Seifel Consulting to evaluate this alternative mitigation plan, which must offer to do more to further affordable housing than if affordable housing was integrated into the project, as so-called inclusionary units. The city requires projects to make at least 15% of the proposed units affordable and inclusionary, so an alternative mitigation plan must offer more than that.

The applicants estimated that 380 affordable units could be built on the 2.4 acres they propose to deed to the city, Mountain View Senior Planner Lindsay Hagan said at the EPC’s Oct. 19 meeting. But the city’s consultant estimated that closer to 338 units would fit – especially if those units had higher bedroom counts, which is essential for making the housing suitable for families.

Either way, Hagan said, there’s sufficient land to accommodate the number of units required for an alternative mitigation plan. Even if the city can only build 338 units on the deeded land, that’s still more than 15% of the total units proposed, she said, meaning the project offers greater benefits than inclusionary units.

But the discrepancy between the applicants’ numbers and the consultant’s numbers still raised concerns for some commissioners. Vice Chair Joyce Yin suggested that the city talk to affordable housing nonprofits to see how many units could reasonably be built on the 2.4 acres. Commissioner Alex Nunez said the city should conduct a risk assessment to better understand how much funding it will take to actually get 300-plus units built, even with the land being free.

Staff and the consultant both maintained that while funding is always a challenge, the plan was feasible.

“We never know what it’s going to take to get these delivered, but the fact that this land is getting dedicated to the city …, that the city can do what it would like to do on it with respect to affordable housing, I think makes a significant difference in mitigating the risk, because the city is in control and can try to address whatever risks occur,” a representative of Seifel Consulting said.

EPC Chair Bill Cranston told the Voice that he spoke with a below market rate housing developer to gauge what it would take to get these units built.

“His answer was, ‘Land’s a good thing. I can work with land,’” Cranston said.

The main challenge would be securing enough state funding, according to the developer, Cranston said.

“There’s a certain amount of money in the state for below market rate housing and everybody wants it,” Cranston explained. “What they (developers) have seen in the past is the state is reluctant to put all of the money into one project. They like more medium-sized projects, all over the place.”

Given this trend, projects with 90 to 100 units are the “sweet spot” for securing state funding.

“Since you’re looking at between 338 and 380 units, they may have to go back and apply for two or three years in a row to get enough money, if there’s no other money out there,” Cranston said.

But, he added, there could be other funding options outside of the state, like the Santa Clara County bond Measure A, or a future bond measure.

While there’s still a lot of unknowns on the affordable housing front, Cranston said he has more confidence in getting housing built in the East Whisman Precise Plan, which encompasses the project area, than he does in North Bayshore, the sprawling office park by Google headquarters slated for massive future housing development.

“Because (North Bayshore) is all controlled by Google, if they say, ‘Let’s build it,’ it’ll happen. If they don’t, then it gets slower,” Cranston said. “The difference with East Whisman is there are multiple land owners. The fact that we’re not dependent on the economics of one company … I think that’s part of the reason why we’re seeing East Whisman projects proposed relatively quickly.”

The EPC unanimously supported recommending the Middlefield Park Master Plan to the Mountain View City Council, on the condition that the council get more information about the mix of bedrooms and number of affordable units that could potentially be built on the deeded land.

Comments

Jack Cormode
Registered user
Waverly Park
on Oct 24, 2022 at 5:37 pm
Jack Cormode, Waverly Park
Registered user
on Oct 24, 2022 at 5:37 pm

About the Middlefield Housing Project - it would be nice to know the exact address we are reading about.


Dan Waylonis
Registered user
Jackson Park
on Oct 24, 2022 at 5:57 pm
Dan Waylonis, Jackson Park
Registered user
on Oct 24, 2022 at 5:57 pm

Yet another clear sign that the onerous building constraints from the city have counter productive results. If the goal is to have more of any housing, this article indicates that now the city will have to try to become a developer.


JAFO
Registered user
Old Mountain View
on Oct 24, 2022 at 6:41 pm
JAFO, Old Mountain View
Registered user
on Oct 24, 2022 at 6:41 pm

Just an observation,

Given the current economic dead end due to Covid labor shortages creating permanent inflation and high interest rates, the predictions of any project are completely unrealizable.

On top of this to just throw to the City a lot of land, when since the very beginning the groups made false promises of affordable housing, this project has been nothing but a toy that Google used to manipulate the City of Mountain View.

With all the changes of the proposal, at this time, it is no longer the same one. Thus whatever approval in the past has been nullified. The approval will have to start all over again.

This shows that the PRIVATE housing industry NEVER will come through with any promises, and thus this warrants the elimination of Costa Hawkins and Ellis Acts, and more state required inclusionary housing laws should be enacted.

Time to start purging all PRIVATE housing ownership from the market, WAIT, that is already going to happen.

The upcoming 20% real estate value corrections are going to bankrupt all developers, real estate agents and landlords. The MARKET is going to crush them.

The continued increase of Mortgage rates are crashing values, putting the private sector housing into underwater. PRIVATE companies are going to either go bankrupt, or the are going to just leave the properties with the keys.

My current expectation is that the Fed will raise the rates at least twice at .75% in Nov and Dec, and there is a 50% chance of another .75% in early 2023, that will likely raise mortgages to 9%.

Face it that industry is toast.


bkengland
Registered user
Whisman Station
on Oct 24, 2022 at 8:01 pm
bkengland, Whisman Station
Registered user
on Oct 24, 2022 at 8:01 pm

Great work from reporter Malea Martin here on distilling from a very detailed and wide ranging EPC discussion.


ivg
Registered user
Another Mountain View Neighborhood
on Oct 25, 2022 at 8:03 am
ivg, Another Mountain View Neighborhood
Registered user
on Oct 25, 2022 at 8:03 am

Jack, this is a huge project with multiple addresses.


Lenny Siegel2
Registered user
Old Mountain View
on Oct 25, 2022 at 9:49 am
Lenny Siegel2, Old Mountain View
Registered user
on Oct 25, 2022 at 9:49 am

Middlefield Park is indeed a complex project, so it's not surprising that the article failed to mention that net NEW office space is proposed to be about 600,000 square feet, not 1.3 million. That makes a big difference in the jobs-housing impact.

There are essentially two types of "affordable" (subsidized) housing: inclusionary and stand-alone. Inclusionary means that 15% to 20% of the units in a market-rate building are subsidized. Stand-alone is nearly 100% subsidized (everything but manager's unit), and these projects often come with social services. Both are good. I would have preferred some inclusionary in Middlefield Park, as Google is planning in North Bayshore. But some of the planned non-Google buildings adjacent to Middlefield Park will provide inclusionary units, so there will be somewhat of a balance in the East Whisman area, where Middlefield Park is located.

For many years Mountain View has worked successfully with usually non-profit affordable housing developers to provide below-market stand-alone units, and I expect that to happen in Middlefield Park.

Unlike some of our neighbors, Mountain View continues to approve a steady stream of affordable housing developments. So despite dedicated city funding, we need more external funding. Historically, some of that funding has come from major investors taking advantage of low-income housing tax credits. One of those investors has been Google.


ivg
Registered user
Another Mountain View Neighborhood
on Oct 25, 2022 at 12:19 pm
ivg, Another Mountain View Neighborhood
Registered user
on Oct 25, 2022 at 12:19 pm

Thanks, Lenny.

I'm not sure that macroeconomic trends mentioned by others have any bearing on this project. Google cannot build the offices without the homes, due to the jobs-housing linkage in the East Whisman Precise Plan. And they can probably finance it themselves, even if lenders bail out.


Leslie Bain
Registered user
Cuesta Park
on Oct 25, 2022 at 3:01 pm
Leslie Bain, Cuesta Park
Registered user
on Oct 25, 2022 at 3:01 pm

Same old story: “The applicants said it's financially infeasible for them to build inclusionary affordable units”; but with a twist, “The city would ... be responsible for finding funding – to build the units.”

I recall that city council candidate Li Zhang was mocked by YIMBYs not long ago for stating that one of her priorities will be to find more funding for affordable housing. They called it a “vaporware” promise. Now Google is pretty much requiring it! Clearly Li Zhang knows what she is talking about, and did not deserve to be mocked.

Speaking of vaporware promises, do we have any guarantee that Google won't pull this same trick in North Bayshore? Also, if the Middlefield Park proposal is approved by City Council, will we be forced to watch as Google happily proceeds with construction of their market rate units, while the fate of the relevant affordable units remains in limbo? That will be fun. Not. I encourage the council to think about that possibility, I suspect it would be a PR nightmare for them. One of the richest corporations on the planet getting the green light while those in need of affordable housing must patiently wait for a savior. And if GOOGLE can't afford to provide such funding … it's wild to think about who might be better able to provide it. I suspect it would be a PR nightmare for Google too.

Statement: “Inclusionary means that 15% to 20% of the units in a market-rate building are subsidized”

Let's be honest: in MV, almost 90% of all units are built for the highest wage earners. No legislation has been passed to change this going forward. These households make up LESS THAN HALF of the population (per 2020 census data), yet the lion's share of housing is built for them. That seems fair. J/K, no it doesn't. “Missing middle” housing is talked about a lot, but it is still very much missing.

Over the last 8-year RHNA cycle, only 12% of housing units (NOT 15%-20%) were created for households who earn <$188K (per 2020 census data); these households were 56% of the population in 2020. - Web Link

Also, state law actually REWARDS developers who provide 11% BMR units with “a 35% density bonus and up to two concessions .. plus development waivers.” Thank you state Dems! Why would a savvy developer EVER provide any more thatn 11% BMR units? Web Link

Voters who earn <$188K (per 2020 census data) take note: when all the building is done and the dust has settled, the rent will STILL be too d*mn high FOR YOU. Google is getting what Google wants, but the housing crisis will continue FOR YOU.

Statement: “Middlefield Park is indeed a complex project, so it's not surprising that the article failed to mention that net NEW office space is proposed to be about 600,000 square feet, not 1.3 million. That makes a big difference in the jobs-housing impact.”

Speaking of jobs-housing impact: Do lower-income people deserve to live close to where they work too? Or do we only care about this ratio for techies?

If the City Council approves this project, a large number of housing units for techies will be created, great, but won't that also INCREASE the need for lower-income service providers? Not only will the fate of the affordable units for this project remain in LIMBO, the need for such housing will INCREASE! That stinks, IMHO.

Last thought: in another news story I learned that “the BMR Ordinance requires affordable units to be equitably dispersed within a development, to ensure that lower income households aren’t all clustered together in one area of the development.” - Web Link

EPC Commissioner Chris Clark made interesting comments on this topic. When BMR units are distributed, it is better because "really no one [in the community] knows which units those are.” So the goal of the BMR ordinance is not just to prevent BMR residents from being given the crappiest units, it's also to prevent them from being stigmatized.

Google's proposal, to have the affordable housing built on a separate plot of land, does not achieve those goals. Middlefield Park will be dedicated to “the haves”, whatever is built on the donated 2.4 acres of land will be dedicated to “the have nots”. And everyone in MV will know that.


JAFO
Registered user
Old Mountain View
on Oct 25, 2022 at 5:24 pm
JAFO, Old Mountain View
Registered user
on Oct 25, 2022 at 5:24 pm

Just an observation,

Isn't this project a Workforce Housing Opportunity Zone?

If that is the case the housing will have to be allocated for 5% verly low income, 15$ Low Income, and 30% up to 120% AMI in the area.

The rest is Market Value.

That is STATE law. Thus it would be a great target for litigation regarding non-compliance with the state laws. I hope the state will sue the City to block this crazy plan.

This is going to be interesting


Steven Nelson
Registered user
Cuesta Park
on Oct 26, 2022 at 4:55 pm
Steven Nelson, Cuesta Park
Registered user
on Oct 26, 2022 at 4:55 pm

Maybe it is "vaporware" and both Google and the council candidate BOTH deserve to be mocked? (affordable housing funding from 'out of the ether').
- I hope that Google can wait. Wait until they deed the land, wait until the affordable housing money is (somehow) raised and wait until the affordable housing starts to be built!


Leslie Bain
Registered user
Cuesta Park
on Oct 27, 2022 at 12:31 pm
Leslie Bain, Cuesta Park
Registered user
on Oct 27, 2022 at 12:31 pm

Steven, vaporware is only vaporware when the person doing the selling knows it and is intentionally trying to deceive a buyer.

It's pretty clear at this point that Google's commitment to build affordable housing is non-existent. They are richer than God, and they know it. They are acting in their own best interests, period. They have friends in high places thanks to the CA YIMBY movement (Gov. Newsom, I'm looking at you). Google appears to recognize that our city council has a track record of "reluctantly" approving project after project, even when last minute stunts are pulled that hurt those in need of affordable housing. Web Link

I would like to see the evidence that Li Zhang is intentionally trying to deceive voters when she writes that one of her priorities is to "Identify additional funding sources to increase the amount of affordable housing in the city, while also partnering with others to increase home ownership opportunities." Web Link

To call such a comment intentionally deceitful without any evidence is to
- admit that one believes that the primary source of funding for affordable housing will always be developer funding, and
- implies that building housing in a ratio of 11 BMR units for every 89 market-rate units is somehow written in stone and the best possible deal that can ever be achieved.

My view is that those who sincerely believe such things are either mathematically challenged or downright frauds when they push for MORE housing to be built in such a ratio in order to help "teachers, service workers, and kids who don't code" to live here. Lower-income persons who make up MORE THAN HALF of the population are getting a TREMENDOUSLY raw deal.

Let me give you an example involving a pizza cut into 10 slices. Here are the nine slices that we are giving to the highest wage-earners in the land:

XXXXXXXXX

and here is the one slice of pizza that we are giving to lowest wage earners (such as "teachers, service workers, and kids who don't code")

X

Those who understand math understand that this ratio is NOT going to bring rents down for the lower-income persons who NEED the most relief from high housing costs. It will INCREASE the number of high-wage earners who live here (that's called "GENTRIFICATION"), which will actually increase the need for ADDITIONAL lower-wage workers to provide services to THEM. Expecting over half the population to share one slice of pizza is ridiculous.

This ratio is also a recipe that will generate great profits for developers, and allow Google to hire more techies (as long as those techies are content to live in expensive, market-rate housing). And THAT, my friends, is why state Dems are pushing this craziness onto MV. State politicians want patronage from developers Web Link and Big Tech Web Link , they don't mind throwing our entire community under the bus in order to get it.


JAFO
Registered user
Old Mountain View
on Oct 27, 2022 at 4:35 pm
JAFO, Old Mountain View
Registered user
on Oct 27, 2022 at 4:35 pm

Just an observation,

Until the actual housing elements are built and are checked for quality, they are STILL vaporware.

A "commitment" is NOT a housing element yet.

Google promised as much as 10,000+ housing units as far back as 2007. Nothing exists yet.

Since the GDP is still rising, the Fed has been given the green light to continue raising rates. It is almost assured that by Jan 2023 the mortgage rates will be 8.5%. And all other loans will raise accordingly. This pattern means we could see the fed rate increase by at least 3% moving forward, reaching 6%.

That means that either the suppliers are going to have to cut prices, or they wind up with inventory that they can't sell.

And they will have to stop borrowing money because credit is going to dry up or it is too expensive. This is a major problem because at least 50% of all businesses are moderately overleveraged with debt. 25% are called ZOMBIES for this reason

This is not going to be saved like the last time in 2007-8 because the market failed to fix itself. No bail outs this time. Prices WILL eventually correct for the future, and those prices are going to be a LOT lower than what many bet they would be.

So we do not have any new pizzas at this time, so there is no slices available to anybody.


Steven Nelson
Registered user
Cuesta Park
on Nov 1, 2022 at 5:13 pm
Steven Nelson, Cuesta Park
Registered user
on Nov 1, 2022 at 5:13 pm

@Bain, I do not see that your choice for Council is a person who supports actual (new) housing. Rather - we see her signs advertising "neighborhoods" and how she will protect them. That is not BUILDING NEIGHBORHOODS which builds housing.

Now - our TOTAL AGREEMENT. GOOGLE continues to 'own the majority of Council'. I love some council members individual work, BUT THEY CANNOT SAY NO! to Google office building. Rather - they chose not to say NO!

Majority vote after majority vote MORE OFFICES in MV for Google.

San Jose needs more offices / let Google fast track their office building in their property in San Jose!


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