Unbuilt Approved Projects Move Forward, but Challenges Loom for the City

University Commons – the mixed-use project remains in some doubt

By David M. Greenwald
Executive Editor

Davis, CA – The Chiles Ranch project that came before the Planning Commission last week is one of five major projects in the city that have been approved but ground has not broken on them just yet.

While the Planning Commission recommended against an extension on the Development Agreement without updating the terms and conditions, City Manager Mike Webb told the Vanguard on Monday that he expects to sit down with Dan Fouts and his team to figure out what is possible.

Fouts was unavailable last week, so Project Manager Lydia Della-Schlosser presented to the Planning Commission.

She explained the delay, “Our original approvals were received in 2009, but at that time we paused due to the economic conditions of that period’s so-called Great Recession. In 2015, as the economy recovered from the economic cycle, we were fortunate to acquire the entitled land at Grande Village and the El Macero property.”

She said, “For many reasons, we chose to focus on Grande Village and the Villas at El Macero.”  They did bring Grande Village and the Villas to completion.  However, when they directed their focus back to Chiles Ranch in late 2019, “at that time, COVID came, and sort of threw us all back and because of the extensive uncertainty of how a worldwide pandemic would affect the overall economy and specifically the housing market, we made the business decision to not break ground on Chiles Ranch in 2020 … who would’ve predicted the housing market would take off as it did under these unprecedented times.”

She acknowledged, “In hindsight, we should have gone for it, but with so many unknowns, we chose to keep our risk low.”

Chiles Ranch may be the longest running unbuilt project, but it is not the only one.  Among the others: Trackside, Nishi, Bretton Woods, and University Commons.

Each actually has their own unique challenges.  For example, with Trackside, the project was approved several years ago and then a lawsuit by the neighbors was originally successful and only last year did an appellate court overturn that ruling, and only early this spring did the Supreme Court decline to hear the case.

As reported two weeks ago, however, Trackside is now on the market.

“After seven years of navigating risk and overcoming more challenges and delays than we thought possible, this exit strategy finally provides a financial return to our investors,” Kemble Pope told the Vanguard.

He added, “If not for the legal delays, we would have built the project and it would have been occupied for some time. Don’t forget, I started the Meridian Place process about a year after Trackside and it was delivered September 2018.”

The team is hopeful that, with a fully entitled project that has cleared its final legal hurdles, a developer will purchase the property and complete the housing.

Meanwhile the prospects remain uncertain for University Commons.  As many probably remember, the project was approved by council on a contentious 3-2 vote only when Brett Lee gained a key concession to lower the building height at the last moment.

Mike Webb told the Vanguard that financing is a problem, but “they know they need it,” meaning the renovation.  As some remember, Brixmor, the commercial entity that owns the site, initially wanted to do a redesign and were convinced by the city to look at mixed use—a prospect they ultimately agreed to but it took them out of their comfort zone.

Adding to the challenges were last-second conditions put on by council to gain the approval.

Webb said on Monday they will be meeting with the team again.  The question is what they want to do at this point.  The options appear to be either just doing the commercial portion of the project as they originally intended or phasing in residential to make it pencil out.

Nishi was the first project approved by the voters and it still has not broken ground.  The 2016 project would have featured an R&D component and had access to Richards Blvd.  The voters turned that down.

So in 2018, the developers came back with a university-only access project that required a railroad crossing to connect it to campus and that has been the hold up.

“Nishi, it’s just the crossing that is holding things up,” Webb said.

He reported that they are now finally doing well with the railroad and also attempting to figure out the exact landing spot on campus.

“They’ve made significant headway in the last couple of months,” Webb said.  “Tim Ruff is sounding optimistic about it.”

The other approved Measure J project is Bretton Woods.  Webb said that Bretton is about a “week or two from getting a grading permit.”  Once Denova Homes closes escrow, the construction on that project could begin sometime this summer.

At this point, of the five projects, Bretton Woods seems closest to actually breaking ground it seems.

There are two other key land use decisions that the city will have to address.  One is the Downtown Plan which was largely completed prior to COVID, but has not formally been approved by council.

Webb did not want to put a firm timetable on it, but it seems that it could go to public review by the end of this month and get to council before the end of summer.  That timeline is still tentative however.

Meanwhile the city is still apparently going back and forth with HCD on the Housing Element.

Mike Webb said that they are trying to “better understand the details of what HCD is looking for.”  He said that frankly, “a lot of comments left the city scratching their heads.”

Here he noted that Davis is not alone, there are eight other cities in the region having similar problems.

He put no timeline on a preliminary draft response, they want some indication as to whether their draft responses are sufficient.

The Vanguard last week laid out potential problems meeting the affordable housing allotment of just under 1000 affordable units.

“I don’t really think it will be a problem,” Webb said.  The city will have to lay out a rationale for the sites that will have to be pursued.  But even with the loss DiSC, Webb expects they can lay out enough infill sites to not have a problem meeting the housing needs.  Though he did say HCD might want to see a timeline where the housing can be built sooner rather than later in the cycle.

The Vanguard has been warning, however, that the city is running out of infill options and here Mike Webb agrees.

“The next Housing Element cycle, that’s where the community will need to be reengaged,” Webb acknowledged.  “I don’t see us infilling our way to a Housing Element next time.”

That means that, by 2029, the city will have to figure out how to get the allotment of affordable housing.

“That’s a key drive to the next General Plan Update,” Webb said.  “Looking ahead to the new RHNA cycle.”

The Vanguard noted last week that the voters have been willing to grant housing projects that do not increase traffic concerns. Where that would be is subject to speculation, however.

One approach could be, as the Vanguard has suggested, to lay out in advance potential areas for annexation and conversion of agricultural land.

But Webb remains skeptical.

“I’m not sure the community would have the appetite for approving a ballot measure that’s not completely laid out,” he said of the pre-approval prospects.

About The Author

David Greenwald is the founder, editor, and executive director of the Davis Vanguard. He founded the Vanguard in 2006. David Greenwald moved to Davis in 1996 to attend Graduate School at UC Davis in Political Science. He lives in South Davis with his wife Cecilia Escamilla Greenwald and three children.

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12 Comments

  1. Richard_McCann

    Property owners, not the City, decide whether and where to advance development projects. That means that the City can lay down general principles and then create incentives to attract development investment, but identifying specific parcels without property owner input is a waste of time.

    1. David Greenwald

      Clearly.  But the bigger problem now is that the is going to have to show they can actually fill the affordable housing component, the city believes that will be a problem next cycle, I actually think it’s a problem this cycle if they can’t get projects approved.

    2. Keith Y Echols

      I believe the city can shorten the terms on future tentative maps (I think the standard is 5 years but that can be negotiated).  They may be even be able to put conditions on final mapped projects.   Other things they might be able to do is create ordinances for properties that go unleased, unrented or undeveloped for periods of time.

      But you have to be careful with how much pressure you put on developers.  The more restrictions you place on them the more difficult it is to get them to initiate new projects because the margin for error has decreased due to the tighter parameters placed on development.   So if I were the Council, instead of a general policy of shortened terms on entitlements and other restrictions; I’d go project by project with the intention of pushing development along without throttling new development going forward.

  2. Ron Oertel

    Good luck (to the state), getting all of the RHNA allocations actually built.  Given that interest rates are rising, the housing market is starting to tank, the stock market has entered bear territory, layoffs are occurring, and population is dropping in areas that are (nevertheless) still subject to RHNA allocations.  (Of which I would guess that 75% of the state’s population live in areas not expanding outward at all.)

    You’ll basically need Wiener, Newsom, Bonta and their YIMBY friends out there with pitchforks, commanding the developers to build.  And of course, the state won’t be handing out enough money to actually get the mandated “affordable” housing built, regardless.  (I suspect that most of that government money will be used in areas with housing that is far more-expensive than what’s found in Davis.)

    Good thing that DiSC wasn’t approved, though – as it would have likely increased Davis’ share of those requirements in future rounds.

    In any case, it seems unlikely that all developments have to (already) be approved to meet RHNA requirements.  (Again, I would look at how other cities are dealing with it.)

    Of course, if your goal is to “use” RHNA requirements to “get” more market-rate housing built (rather than just addressing the requirements, themselves), you’d likely be making the type of argument (and bringing up the same type of “concerns”) as those found on the Vanguard.

  3. tkeller

    “The next Housing Element cycle, that’s where the community will need to be reengaged,” Webb acknowledged.  “I don’t see us infilling our way to a Housing Element next time.”

    Wait… so that means that all those people saying that we should be “looking at infill options” for DiSC instead of building it on the periphery were proposing an alternative that had no basis in reality?

    Say it aint so!

    Now we get to have arguments about densification and building height and traffic IN town…   what a relief… 🙁

    1. David Greenwald

      Infill as a substitute for DiSC was never based on reality. We had the Studio 30 report from 2012 which indicated current and proposed sites in town were too small and insufficient to meet our needs.

      1. tkeller

        This is a good example of why Measure J really needs to go.

        Our general populace is simply not equipped to do urban planning directly.   The issues / alternatives details are quite important to making a good decision, and its unrealistic to expect that voters will become that informed.

        Now throw willful disinformation into the mix, combined with conspiracy theories and the rumor-mill churn of social media…  and the chance that Voters could make “good decisions” in the middle of all that is basically zero.

        1. David Greenwald

          One problem with an up or down vote is that there a huge status quo advantage, but the reality is that’s not the true alternative.  It’s not project versus no project, it’s project versus some other alternative the council will have to come up with at a future date.

  4. Ron Oertel

    We had the Studio 30 report from 2012 which indicated current and proposed sites in town were too small and insufficient to meet our needs.

    “Our needs” is not the same thing as a massive business park (which would simultaneously create a housing shortage), outside of town. 

    In fact, I doubt that the report actually used your wording.

    The city of Davis has existed this long without it. (I’d still suggest examining the underlying reason that cities throughout California are experiencing challenges. For that matter, why isn’t Newsom bailing them out, with that massive state surplus? And why aren’t cities pursuing that?)

    In any case, “it’s dead, Jim.”

  5. David Greenwald

    From the Studio 30 report (exact wording – emphasis added)

    • The current isolated and dispersed sites that are available and appropriately zoned are not adequate in terms of size, location, or configuration (and related constraints) to address the emerging market need of an Innovation Center. With available reasonably priced land and effective marketing to innovative high tech companies, Studio 30 estimates Davis could absorb up to 10 percent or around 100,000 square feet of the 1-1.5 million industrial/ office square footage absorbed annually in the Sacramento region. Because of this Studio 30 estimates Davis needs at least 200 acres for business development and expansion over a 20 +/- year time horizon.
    • Land Use Strategies Studio 30’s research suggests that the City pursue a broad strategy to attract innovative businesses that offers a number of sites that are scalable and range in size so the community can accommodate an incubator, startups and expanding businesses. Some should be directly in contact with the University. This mix of small and large sites allows the city the flexibility to successfully attract, grow and retain innovation businesses. External sites have the potential to support the most jobs because of their size and ability to accommodate a wider variety of both size and type of businesses.
    1. Ron Oertel

      need of an Innovation Center

      A “need of an Innovation Center” is not the same thing as “our needs”.

      Two different things.

      This is like saying the “need of an airport” is a mile-long runway. But, such a statement doesn’t tell you if you need an airport.

      As far as local market demand is concerned, let us know when the Woodland business park (which moved from Davis after failing there, and added 1,600 homes during its 7-mile move) has even a single commercial tenant.

      I’m guessing that we’ll all be dead before that place is “full”. (Though I have no doubt that they’re itching to build the 1,600 homes, as soon as the upcoming housing crash has run its course. That crash has already started.)

      Keep in mind that the Woodland site was planned as a strictly-commercial business park prior to the “move” of the Davis proposal. And yet, ended-up adding 1,600 homes. (Sound familiar?)

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