Days before the council was to discuss Shapell Homes’
application to annex land into the city for more than 1,600 homes,
the developer withdrew its application.
Days before the council was to discuss Shapell Homes’ application to annex land into the city for more than 1,600 homes, the developer withdrew its application.
Shapell representatives did not return multiple messages Thursday, but City Planner Stan Ketchum pointed to the recession.
“The economics of the project have changed,” he said without commenting further.
Environmentalists are cheering the withdrawal, which has also killed a concurrent application the city had filed with itself to incorporate the 86-acre sports park just south of Gilroy’s limits. Combining the park with Shapell’s larger “Thomas Neighborhood” proposal made sense to planners trying to prevent “islands” of county land jutting in and out of the city, Ketchum said.
Shapell is the latest developer to throw in the towel. Gavilan College temporarily withdrew an application last month to turn its golf course into dorms and bring its entire campus within Gilroy’s borders. That leaves The Lucky Day Partnership’s proposal to annex 285 idyllic acres straddling Burchell Road north of Hecker Pass Highway for up to 193 homes and 244 acres of open space and parks, and Wren Investors’ application to incorporate 48 acres near Christopher High School for up to 430 dwelling units.
“Two down (kind of), two to go. Onward!” wrote Brian Schmidt, legislative advocate for the Committee for Green Foothills. The nonprofit works to “protect open space and the natural environment of the Peninsula and Coast,” according to its Web site. The group, along with others like Save Open Spaces, has vocally opposed Shapell’s project.
Shapell – the company behind the hilly Eagle Ridge neighborhood west of Santa Teresa Boulevard – filed its Thomas Neighborhood application in July 2008, spending more than $125,000 since then for city attorneys to review plans, environmental reports and other paperwork, according to city files. As far as the city is concerned, the company will have to reapply from square one if it decides to resuscitate its project, but staff could probably reuse most of the work, Ketchum said.
Earlier this month, a split planning commission rejected Lucky Day’s application but approved those filed by Shapell and Wren Investors. Gavilan had already withdrawn its project at that point because college President Steve Kinsella said environmental reviews unfairly characterized the college as a developer rather than an educator giving back to the community.
Staff have generally encouraged all four projects to avoid construction bottlenecks in the future and to ensure seamless development when the housing market begins to recover later this year, Ketchum said.
The city council will discuss the Wren and Lucky Day projects Monday night. If approved, the Local Agency Formation Commission, a regional agency with veto power over annexation requests, will consider Gilroy’s potential expansion. LAFCO rejected the city’s park bid in October 2002 in an effort to preserve agricultural land, but the council voted to build the park anyway on county land.
Although the council now has fewer applications to consider, Mayor Al Pinheiro said this does not mean the remaining two projects stand a better chance.
“Just because (Shapell & Gavilan) are no longer applicants does not mean whoever’s left is an easier decision,” Pinheiro said. “The times we’re in are very interesting and volatile. Decisions made in the past look a lot different now.”
Although Gilroy currently has enough empty land to develop 3,500 homes during the next 11 years – well above the 5-year threshold the city’s general plan calls for – developers of the Wren and Lucky Day projects probably won’t break ground until 2015 due to permits and reviews, Ketchum said. By that time, staff expects some developers to revive stalled developments. The city has approved nine home construction permits since Jan. 1 compared to the 300 or so it approved each year during the late 1990s and early to mid-2000s, according to city figures.
