The URL can be used to link to this page

Home My WebLink About7.2 Dublin Commons Affordable Housing Proposalr DUBLIN CALIFORNIA STAFF REPORT CITY COUNCIL Agenda Item 7.2 DATE: September 3, 2024 TO: Honorable Mayor and City Councilmembers FROM: Linda Smith, City Manager SU B.ECT: Dublin Commons Affordable Housing Proposal Prepared by.• Hazel L. Wetherford, Deputy City Manager EXECUTIVE SUMMARY: The City Council will review the Dublin Commons Affordable Housing proposal for the future development of the site. STAFF RECOMMENDATION: Review and provide direction on the Dublin Commons Affordable Housing proposal. FINANCIAL IMPACT: There are no financial impacts associated with reviewing the proposal. DESCRIPTION: Background On August 20, 2024, the City Council received a presentation on the proposed framework for the Dublin Commons Development Agreement for the future development of the site as further detailed in Attachments 1 and 2. As part of the framework, the affordable housing section proposed American Realty Advisors (ARA) and Hines' (together the Applicant) request for an alternative method of compliance to dedicate Block H, just east of the Dublin Senior Center, to the City and/or designee. This approximately 1.1-acre site was contemplated by the City Council as part of its Memorandum of Understanding with ARA in 2019 for a senior affordable housing project. The site is estimated to accommodate between 80-170 units, and 80 of these units are included in the overall request for the project. At the August 20, 2024 City Council meeting, by consensus, the City Council directed Staff to look into including affordable housing units within the apartment buildings in the Dublin Commons Page 1 of 4 1 project. Staff has since worked with the Applicant on an affordable housing proposal that would achieve the direction provided by the City Council. Affordable Housing Proposal There are 1,510 units available on the site. There are 1,270 units available in the Downtown Dublin Specific Plan (DDSP) Residential Development Pool (Development Pool). The additional 240 units are from the two 2023-2031 Housing Element sites. When the Housing Element was adopted in 2022, the City Council, as required by the Housing Element Law for sites that had been included in previous cycles, amended the DDSP to make these sites available without accessing the Development Pool provided that 20% of the units in such projects are affordable to lower -income households (see Table 6.2 and accompanying text in the DDSP). Two of those housing element sites, identified as Site #4 and Site #20 in the Housing Element, are on the Developer's property. Site #4, 80 DDSP-development-pool-exempt units, is adjacent to the Senior Center. Site #20, 160 DDSP-development-pool-exempt units, is the parcel just south of the Target site as shown in Attachment 3. The Applicant is requesting 1,392 units for the Dublin Commons project of which 1,270 would be allocated from the DDSP Residential Development Pool. The applicant is proposing an additional 122 units from Housing Element Site #20, which requires it to provide 20% lower -income units on those 122 units. The inclusionary housing obligation for each category of requested units is described in Table 1 below. Table 1. Dublin Commons Inclusionary Housing Obligations Units Requested Affordable Housing Requirement (%) Income Level Affordable Unit Obligation DDSP Residential Development Pool 1 270 10% Low-income households 127 Housing Element Site 122 10% Low- income households 12 Total 1,392 139 Because the Developer is using 122 exempt units, it has a separate obligation, as noted above, to provide 24 "lower -income" units if it uses the 122 exempt units. Because lower -income units are the low-income units under the Inclusionary Zoning Regulations, those units would satisfy the 12- unit Inclusionary Housing Obligation for those 122 units. It should be noted that the 122 exempt units were identified to a specific parcel where the units are assigned. Through the redevelopment of the project site, the Applicant is instead proposing to reconfigure the parcels and spread these units across three parcels. Spreading the units across three parcels achieves the overall requirement to provide affordable units in accordance with the Housing Element and DDSP even though less than 20% of the units on these parcels will be affordable. This appears to meet the intent of State law, the Housing Element and the DDSP to achieve at least 24 affordable units. Page 2 of 4 2 The Applicant's "alternative method" affordable housing proposal is the following: • Applicant will improve (grade and stub utilities) and enter into an Affordable Housing Agreement with the City for the transfer/dedication of an approximately 1.1-acre site (Parcel H) prior to the issuance of a residential building permit for the Dublin Commons project. Parcel H will be designated for the development of an affordable housing project which would accommodate at a minimum 80 units for lower -income households (Parcel H can accommodate more than 80 units). • Upon transfer/land dedication, the Applicant will be allowed to build and occupy up to 600 market rate units in the Dublin Commons project. • If, prior to the 601st occupancy permit in the Dublin Commons project, construction of an affordable housing project has commenced on Parcel H for a minimum of 80 lower -income units, then no additional lower -income units will be required for the first 1,270 units in the Dublin Commons project. • If, prior to the 601st occupancy permit in the Dublin Commons project, construction of an affordable housing project has not commenced on Parcel H, then five percent of the units in the Dublin Commons project between 601 and 1,270 will be low-income units (34 units with Inclusionary Zoning Ordinance rounding). However, upon the start of construction of Parcel H, the low-income restriction on these units would be released. • In addition, 10 of the units in each building of the Dublin Commons project will be moderate income units (for a total of 30 units). • Any units above 1,270 would be subject to the DDSP requirement that 20% of the units be affordable to lower -income. If, as anticipated, the total number of units constructed is 1,392, it would result in an additional 24 lower -income units in the Dublin Commons project. • Lastly, the Applicant would be entitled to receive affordable housing credit for each unit above 151. This provision creates an incentive for the Developer to increase the number of affordable units on the Parcel H site. In total, the Dublin Commons project would provide a total of 134 affordable units as shown in Table 2 below with the exception of the deed restricted units since the restriction can be released with the start of construction of Parcel H. Table 2. Dublin Commons "Alternative Method" Affordable Housi Affordable Units Parcel H 80* Onsite Moderate Income 30 Onsite Lower -Income 24 Total 134 ng Proposal Page 3 of 4 3 *Parcel H could accommodate up to 118 units while still remaining within the 1,510 units available. To summarize, Staff is recommending that the City Council provide direction on the affordable housing proposal to be included in the development and community benefit agreement. STRATEGIC PLAN INITIATIVE: Strategy 1: Economic Development, Small Business Support, and Downtown Dublin Objective B: Work with ARA and Hines on the development of the Dublin Commons project, including associated public improvements, relocation of tenants, development agreement and appropriate incentives to effectuate physical changes to the area, as well as support for small businesses. NOTICING REQUIREMENTS/PUBLIC OUTREACH: The City Council Agenda was posted, and a copy of the Staff Report was shared with the Applicant. ATTACHMENTS: 1) Dublin Commons Site Plan 2) August 20, 2024 City Council Staff Report (without attachments) 3) Housing Element Downtown Site Map Page 4 of 4 4 Attachment I SITE PLAN " a IIIIIIIIIIIIIIi]iIIIiIIIIIeiC �I�I II�I';IYIIIIIIIIIIIIIIIIIIIIIIIIIII' iuxiu t tWL 1Wr AMADOR VALLEY BOULEVAR SECOND ST LIN BOULEVARD S C ' D STREET PLAZA DR PLAZA DRIVE II II II III - III III III III III III III DUBLIN BOULEVARD f.1 �YJ 1 RESTAURANT/ CAFE RETAIL RESIDENTIAL LOBBY FITNESS OFFICE PARKING Hines AAMERICAN REALTY ADVISORS DUBLIN COMMONS swa Gensler 5 Attachment 2 r DUBLIN CALIFORNIA STAFF REPORT CITY COUNCIL Agenda Item 8.2 DATE: August 20, 2024 TO: Honorable Mayor and City Councilmembers FROM: Linda Smith, City Manager SU B.ECT : Proposed Framework for Dublin Commons Development Agreement Prepared by: Hazel L. Wetherford, Deputy City Manager EXECUTIVE SUMMARY: The City Council will review the proposed framework for the Dublin Commons Development Agreement for the future development of the site. STAFF RECOMMENDATION: Review and provide direction on the proposed framework for the Dublin Commons Development Agreement. FINANCIAL IMPACT: There are no financial impacts associated with approving the proposed framework. DESCRIPTION: Background Over the last several years, the City Council has made significant progress towards realizing the goal of delivering a downtown project to the community through the Downtown Dublin Preferred Vision. There have been at least 10 public meetings and subsequent actions during that period. Following is a summary of those meeting dates and actions taken: October 15, 2019 Resolution No. 107-19 which approved a Memorandum of Understanding (MOU) between the City and American Realty Advisors (ARA), the primary property owner of the Dublin Place shopping center. November 5, 2019 Resolution No. 115-19 which approved the Downtown Dublin Preferred Vision (DPV) and its three main principles (siting of the town square, a new street grid network, and the downtown character). Page 1 of 6 6 December 3, 2019 Resolution No. 126-19 which amended the General Plan and Downtown Dublin Specific Plan (DDSP) to allow an increase in the allowable commercial floor area ratio (FAR) in the Transit Oriented and Retail Districts, combined new residential dwelling unit allocation into one pool for all three districts, and amended the parking standards for the Village Parkway and Transit Oriented Districts. July 21, 2020 Resolution No. 79-20 which amended the DDSP to create a new street grid in the Retail District, site a town square, combine the remaining allocation of new non-residential square footage from the Transit Oriented and Retail Districts into one pool, allow lodging in the Retail District, and update the design guidelines for the Core Area of the Retail District. November 17, 2020 Resolution No. 121-20 which adopted the Downtown Dublin Streetscape Plan and amended the City of Dublin Streetscape Master Plan. April 6, 2021 Resolution No. 26-21 which approved a First Amendment to the MOU with ARA, providing a 12-month term extension. April 5, 2022 Resolution No. 30-22 which approved a Second Amendment to the MOU with ARA, providing a 14-month term extension. November 6, 2023 Received a presentation from Staff, the City's consultant Urban Field Studio, and ARA on the proposed implementation of the DPV. After the presentation, the City Council provided direction to Staff on additional DDSP Amendments required to support the DPV. December 19, 2023 Resolution No. 134-23 amending the General Plan and DDSP to further implement the Downtown DPV. The amendments consisted of adding Research and Development as a new land use, increasing the residential allocation by 465 units, decreasing the non-residential allocation by 300,000 square feet, increasing the building height and floor area ratio in the Core Area of the Retail District, and changing setbacks. July 16, 2024 Received a presentation from Staff on updates to the Downtown Dublin efforts, including the ongoing work on the development of the Dublin Commons project, which includes the town square, living options, commercial uses, and the proposed life science buildings. Upon adoption of the DDSP amendments in December 2023, ARA and Hines (Applicant) submitted a Planning Application for the Dublin Commons project which is the redevelopment and rebranding of the Dublin Place shopping center consistent with the core tenants of the Preferred Vision. Dublin Commons is a mixed -use project of up to 275,000 square feet of retail (consisting of 155,000 square feet of new retail and 120,000 square feet of existing retail), 535,000 square feet Page 2 of 6 7 of Research and Development (Life Science), up to 1,510 multifamily residential units (inclusive of the affordable housing site units) and a new Town Square. As Staff has shared in previous presentations, the City has partnered with ARA to bring the City's Preferred Vision to reality. The City approached ARA with the opportunity for a public -private partnership to deliver a project that neither the City nor the property owner could accomplish alone. Based on this partnership, ARA has made significant commitments exceeding $90 million as further detailed in Attachment 2. Framework for Development Agreement and Community Benefit Agreement As part of the proposed project, the Applicant is requesting approval of a Development Agreement and Community Benefit Agreement (Agreement). The Agreement would provide security to the Applicants that the City will not change its zoning and other laws applicable to the project for a stated period. Additionally, it is a mechanism for the City to obtain commitments from the Applicants that the City might not otherwise be able to obtain. Below is the framework for the Agreement. • Term o An initial 25-year term with options to extend one-year increments for up to 10 additional years. o Applicant would make a community benefit payment to the City of $250,000 per year unless, at the time of the extension request, the City Manager determines that significant process is being made on the project. • Phasing o The project will be phased over time and the initial phase will include the Town Square and the surrounding commercial development around the Town Square, both of which will be completed prior to or concurrently with the first residential development. • Downtown Dublin Specific Plan Residential Development Pool o Applicant is requesting a reservation of the remaining 1,270 units from the Downtown Dublin Specific Plan Residential Development Pool. o In order to pull units from the Pool, community benefits must be considered. The Staff has included the following benefits: ■ Project will generate significant new revenue for the City, anticipated to be $130 million over 30 years. ■ Project is estimated to generate 1,400 jobs at build out. ■ Project will serve as a catalyst for future economic development around the Downtown area and is consistent with the goals and objective of the Downtown Preferred Vision. ■ City has requested from the Applicant to designate Dublin as the point of sale for the general contractor and sub -contractors so any sales tax derived from such activities during construction can be allocated to the City. Page 3 of 6 8 One item still under discussion is the ability to utilize future square feet within the Life Science/Office buildings for use as a lab and coworking center. • Affordable Housing o Applicant would enter into an affordable housing agreement with the City, which would include an alternative method of compliance to dedicate Block H, just east of the Dublin Senior Center, to the City and/or designee. This 1.1-acre site was contemplated by the City Council as part of its Memorandum of Understanding with ARA in 2019 for a senior affordable housing project. The site can accommodate between 80-170 units and 80 of these units are included in the overall request for the project. It should be noted that there are additional obligations outlined in the Housing Element for this location that have been codified in the DDSP that would need to be addressed as part of any agreed upon affordable housing program for this site. • Public Infrastructure and Improvements The public infrastructure and improvements are a vital part of the overall project and the City's involvement in participating in these costs is key to the overall feasibility. Following is a summary of the items and obligations being discussed: o Applicant will receive fee credits and reimbursements for certain public improvements made on behalf of the City. These include: ■ Town square dedication and improvements ■ Construction of new public streets ■ Modifications to existing intersections ■ Bicycle and pedestrian improvements ■ Other improvements identified in the Western Dublin Transportation Impact Fee program o Staff is recommending an allocation of public art fees to the project area, as well as a future gateway sign. o Public Parking Garage: The garage is extremely important to the overall project at a later phase once the second life science building is constructed. The Applicant and Staff propose the following: ■ City acquisition of the 2-acre public parking garage site (Block E2). ■ Applicant to improve surface parking during the intervening period. ■ Improvement of the public parking garage site upon approval of the second life science building. The number of parking stalls, 1,100, was vetted by the City's parking consultant. This number will provide adequate market -based parking for life science users as well as daytime and weekday use. The capacity will also be necessary to handle the Page 4 of 6 9 more intense use during the evenings and weekends. The parking garage site is estimated to cost $6 million, and the garage improvement is estimated to cost $75 million. Staff is recommending a financial commitment to support these public improvements through available grant funding, financing, and use of the General Fund Reserves. Staff will continue to allocate future annual surpluses and other lump -sum funding to the General Fund Downtown Public Improvements Reserve towards the project during the initial phase and during later phases (public parking garage) to help offset costs associated with these public infrastructure improvements. • Marketing and Promotion o The Agreement will also anticipate language to have the Applicant formalize a marketing and promotion effort to support the businesses surrounding the Town Square, as well as events within the Town Square. • Maintenance o The Agreement will also address ongoing maintenance of the private and public infrastructure in Dublin Commons with consideration of the Applicant agreeing to funding maintenance for public infrastructure. The Applicant may propose an alternate method, to be approved by the City Engineer. • Small Business Support o Staff and Applicant proposed to work together to provide small business support programs to help incentivize the attraction of high -quality restaurants and retailers. Currently, the City has sewer capacity set aside for the Downtown area that could be provided to the project and to specific restaurant tenants at the City Council's discretion. Additional support could come from the use of the Small Business Assistance Program that has been in use by the City to support improvements related to Title 24/ADA and/or trash enclosure requirements. • Commercial Retail Development o To ensure high -quality restaurants and retailers, Staff and the Applicant agree that the Site Development Review will include: ■ Minimum ground floor commercial height of 18' ■ Minimum of 100,000 square feet of retail spaces surrounding the Town Square ■ Provide several outdoor dining areas to support a vibrant dining experience • Funding Mechanisms o Staff and the Applicant agree to work on possible funding mechanisms to support the project including, but not limited to: ■ Use of the General Fund Reserve for public infrastructure and improvements ■ Lease revenue bond (finance the construction of the parking garage) ■ Available Grant Funding Page 5 of 6 10 ■ Fee Deferrals ■ Tax Sharing Options (Property/Sales) ■ Statewide Communities Infrastructure Program ■ Enhanced Infrastructure Financing Districts ■ Community Facilities District ■ City's existing programs, including Sewer Capacity, Commercial Facade Grants and Small Business Assistance programs. To summarize, Staff is recommending receiving feedback and direction from the City Council so that Staff can proceed with the preparation of the Agreement. Should the City Council authorize Staff to move forward, a Development Agreement and Community Benefit Agreement will be formalized and will be brought to the Planning Commission for review and recommendation to the City Council. STRATEGIC PLAN INITIATIVE: Strategy 1: Economic Development, Small Business Support, and Downtown Dublin Objective B: Work with ARA and Hines on the development of the Dublin Commons project, including associated public improvements, relocation of tenants, development agreement and appropriate incentives to effectuate physical changes to the area, as well as support for small businesses. NOTICING REQUIREMENTS/PUBLIC OUTREACH: The City Council Agenda was posted, and a copy of the Staff Report was shared with the Applicant. ATTACHMENTS: 1) Site Plan 2) July 16, 2024 City Council Staff Report Page 6 of 6 11 2023-2031 Housing Element Attachment 3 DUBLIN CAI IFORNIA Figure D-1: 2023-2031 RHNA Sites Inventory Map ��- City Boundary Existing Capacity Sth Cytk Site: Sites to Accommodate Remaining Need Alameda County Surplus Property Hacienda Crossing. SC 5 Property C' Village Appendix D: Adequate Sites Analysis D-21 12 Dublin Commons Affordable Housing Proposal September 3, 2024 II DUBLIN CALIFORNIA 13 Background • 8-20-2024 - Proposed Framework for Development Agreement — City Council direction to include affordable housing units within the Dublin Commons project 14 Affordable Housing Proposal • 1,510 units available — 1,270 units DDSP Residential Development Pool — 240 units Housing Element Sites: #4 - 80u and #20 — 160u 15 Affordable Housing Proposal, 2 Net Potential Units Units by Income Category 4 80 20 160 80 Low I10Low 50 Moderate sM DUBLIN CALIFORNIA • 16 Affordable Housing Proposal, 3 • 1,392 units have been requested by Applicant — 1,270 units from DDSP Residential Development Pool — 122 units from Housing Element Site #20 • Housing Element sites require 20% lower -income units Affordable Housing Proposal, 4 • Dublin Commons Inclusionary Housing Obligations Units Requested Affordable Housing Requirement (%) Income Level Affordable Unit obligation DDSP Residential Development Pool 1,270 10 o Low-income households 127 Housing Element Site 1 10o Lowy- income households 1 2 Total 1,392 139 Affordable Housing Proposal, 5 • Alternative Method Request Includes: — Applicant will improve (grade and stub utilities) and transfer/dedicate Parcel H (approx. I.1-acre site) — Upon transfer/dedication, the Applicant will be allowed to occupy up to 600 market rate units — If, prior to the 601 st occupancy permit, • construction has commenced on Parcel H, then no additional lower -income units will be required for the first 1,270 units • construction has not commenced on Parcel H, then five percent of the units between 601 and 1,270 will be low-income units (34 units with rounding). However, upon start of construction, the low-income restriction would be released on those units. Affordable Housing Proposal, 6 • In addition, 10 of the units in each residential building of the Dublin Commons project will be moderate income units (30 units) • Any units above 1,270 would be subject to the DDSP 20% requirement (24 units) • Lastly, the Applicant would be entitled to receive affordable housing credit for each unit above their obligation Affordable Housing Proposal, 7 • Applicant's proposal includes Affordable Units Parcel 11 80* Onsite Moderate Income 30 Onsite Lower -Income 24 Total 134 *Parcel II could accommodate up to 118 units while still remaining within the 1,510 units available. DUBLIN CALIFORNIA Ea Recommendation • Receive and provide direction on the Dublin Commons Affordable Housing proposal • Questions