Business / Economy

Build, and here they come

A big-picture look at new housing development and growth in San Benito County.
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This BenitoLink Special Report was written by BenitoLink reporter John Chadwell and produced for the benefit of San Benito County residents and BenitoLink readers.

Over the next decade, if housing demand continues to be strong, San Benito County could see the construction of as many as 14,000 new homes. Today, approximately 6,000 homes are either under construction or approved for construction countywide. 2,400 of those homes are in the unincorporated areas of the county. In addition, the city of Hollister has approved 3,315 units, and the city of San Juan Bautista has about 130 under construction.

Hollister city planners use an average of 3.1 persons per household when estimating growth figures, If all 14,000 of the possible new homes under discussion were sold, which could take over a decade, the county would see a population increase of about 43,400.

In the near future, Hollister would be the community most affected, with a population increase of approximately 51 percent.

Although potential growth is shocking, experts say these numbers could change because real estate market demand is the final influence on what will be built and when. Buyer waiting lists for home construction with large developers range between six months and two years, according to local realtor Ray Pierce.

A former member of the Hollister Planning Commission and current member of the San Benito County Planning Commission, Pierce says there is no doubt that traffic and quality of life would be adversely impacted by the population increase, until regional highways or transportation systems are improved and more local jobs with good salaries become available.

Pierce also said that even though the current housing inventory throughout the state is under supplied by 160,000 units per year, San Benito County is unique.

“There’s a lot of pent-up demand,” Pierce said, because the county had little or no growth for six to eight years, because of a sewage spill in 2002 that resulted in a building moratorium.

“Everyone thinks the city and county are in control of growth, but we have to send our growth management elements to the state for approval,” he said.

Though some people have called for another moratorium, Pierce said that won’t happen because if a developer has met all the requirements in the approval process and the city or county tries to stop the project, developers “would retaliate and take legal action.”

What’s driving growth?

More people are taking part in a phenomenon called “outmigration” or moving to more affordable counties, the California Association of Realtors’ website states.

According to Zillow, an online real estate database, the current median home sale price in Salinas is $749,000 while in Morgan Hill it’s $999,950 and in San Jose it’s $1.1 million. It’s no surprise then, that people flock to San Benito County, where the median price is $515,000.

Planning for growth

Every five years or so, San Benito County and the cities of Hollister and San Juan Bautista update their general plans—which normally look ahead 20 years—to address growth. But what that growth ultimately looks like, according to county planner Taven Kinison Brown, comes down to whether developers want to spend money and invest in building homes here.

“When they come looking for a place to build homes, they look at the development standards [requirements for park, sidewalks and other improvements] for them,” he said.

Resource Management Agency Director John Guertin said the county works with developers on a passive rather than proactive basis. “They come to us and we walk them through the process, help them design a project that fits within the county’s codes and regulations,” he said.

County-approved subdivisions

According to a Nov. 9 report obtained by BenitoLink, San Benito County has approved six subdivisions that are under construction and when completed, will add 4,207 homes to unincorporated areas.

It sounds like a lot of homes but of those, only 325 building permits—all for Santana Ranch—have been issued so far. While there is no deadline for completion of any of the projects, developers have an initial two years, with a one-year extension, after their plans have been approved to begin construction. Brown said that developers try to build homes no faster than they can be sold.

Current county projects include:

  • Santana Ranch along Fairview Road has been approved and will eventually total 1,092 units.
  • Work has begun on Southside Road, just north of Union Road for the Brigantino/Sunny Side and Fay/Bennett projects that will ultimately total 284 units.
  • A 90-unit subdivision called The Bluffs at Ridgemark is in planning for the south side of Ridgemark, overlooking Southside Road. So far, the developer has not asked for any building permits.
  • The 217-unit Fairview Corners is slated to be built on the corner of Fairview Road and Airline Highway, next to the proposed site of a Gavilan College campus.
  • The long-delayed senior housing project once associated with Del Webb located at San Juan Oaks, consisting of 1,084 units, has also been approved. Former San Juan Oaks General Manager Scott Fuller resigned in June to become consultant/project manager for the active adult community, but so far no visible activity has taken place, Guertin said.
  • The proposed Lima Specific project, if approved, will consist of 1,250 units on 354 acres along Airline Highway between Ridgemark and Tres Pinos School. The property would have to be rezoned from agricultural to residential. The developer, Brian Hardy, has not submitted his formal application, but has met with community groups, elected and appointed county officials, county land-use agencies and utility service providers.
  • John Wynn, the owner of the Ridgemark Golf Club, hopes to build 190 units along with his proposed commercial development, which includes a 150-room hotel. Even though an application has been submitted, the county said there are still questions about who has the development rights to the open space of the former golf course.

On the distant horizon, applications have also been submitted to the county for an additional 6,797 units to be built in unincorporated areas outside of Hollister and San Juan Bautista. The most ambitious and controversial project is the Floriana Ranch development, involving 2,777 acres along Highway 25 north of Hollister near the border with Santa Clara County on the Bolsa flood plain. This project is a portion of what was known as Rancho San Benito and was under discussion in 2005. Applications have been submitted on behalf of Floriana Ranch for a general plan amendment, zoning change and specific plan for a master-planned, mixed-use community. Guertin said adjustments may have been made—but it originally included 5,300 units and a 2.7 million square-foot commercial space made up of public and agricultural land.

Hollister developments

Hollister associate planner Abraham Prado told BenitoLink after the building moratorium was lifted in December 2008, the number of annual permits fluctuated slightly until 2017, when they spiked to 310 permits.

He said the growth management Measure U adopted in 2002 limited the number of building permits per year at 244. It expired in 2012. While the Hollister Planning Commission approved an amendment to the housing element of the general plan to cap building permits at 244 annually in October 2018, the City Council has yet to adopt it.

Without this measure the city has no leveraging to require developers to build mixed-use or low-income housing. Today, there are 16 approved developments in the city, amounting to 1,192 units.

Out of those, Prado said only 645 building permits have been issued as of Nov. 1. He added that each project is analyzed to determine what improvements, such as parks and lighting, will be included.

“If a project is going to have open space we indicate after a certain number of units the park should start," Prado said. "No more single-family permits will be issued after a certain number until the multifamily permits are issued and construction starts."

Overall, the Hollister Planning Department has 56 projects in various stages of development totaling 3,315 units (see maps and lists below), which range from a simple single-family home near Sally Street to 760 units along Fairview Road south of St. Benedict Catholic Church. Some, such as the Award Homes project, were approved decades ago and the land sat vacant through the building moratorium and the Great Recession. Award Homes filed a lawsuit against the county in July 2015 concerning “unlawful annexation fees.” There was a judgment in June 2017, but the case is now in the court of appeals, according to County Counsel Barbara Thompson.

While many projects are still in the permit stages, a number of them are nearly completed. Here are some of Hollister’s 56 projects:

  • The largest parcel is actually two developments adjacent to each other. Together, the Award Homes and Roberts Ranch developments would build out to 987 units.
  • The Award Homes/Ladd Ranch project near Ladd Lane Elementary School, consists of 82 units.
  • Benchmark’s 241-unit Cerrato Estates along the Highway 25 interchange between Hillcrest Road and Meridian Street is nearly complete.
  • Also under construction is another Brigantino project, south of Hillcrest Road with 42 units.
  • The Allendale project on the hill behind the Fairfield Inn & Suites by Marriott will consist of 287 units.
  • Groundwork has just begun along Valley View Road between the Hollister Fire Department Station #2 and Hazel Hawkins Memorial Hospital for the Silver Oaks project, consisting of 170 units for seniors.
  • Local developer Hugh Bikle has three projects, Hillcrest Meadows with 42 units completed, Walnut Park, which is completed, and Maple Park near the post office, which just began construction of 42 units.

As Measure U is no longer in effect, Prado said the city is considering adopting a new growth management ordinance to increase the inventory of multifamily, affordable, or special-needs housing.

“Affordable housing is encouraged, but the city does not have an inclusionary zoning ordinance that requires it,” Prado said.

Meanwhile, the nonprofit Community Housing Improvement Systems and Planning Association, Inc. (CHISPA) has a project of 49 affordable senior homes under construction on Line Street.

San Juan Bautista developments

The San Juan Bautista Planning Department did not respond to a request for information on developments, but BenitoLink has published earlier reports on the planned Rancho Vista development. The San Juan Bautista City Council approved the final subdivision map during a special meeting on June 26.

  • Rancho Vista, on the north end of San Juan Bautista will include 85 single-family homes.
  • The City Council also approved the final map for the Copperleaf subdivision on Feb. 21, 2017, for 45 single-family homes to be built north of Old San Juan Road.

Where are buyers coming from?

A number of local realtors believe most buyers are coming from outside the county, but Pierce said there is also a significant number of local residents who are “moving up” to newer homes. Local developer Hugh Bikle, who has three infill developments in Hollister, has kept track of where those who bought homes at his Hillcrest Meadows project came from.

Bikle said that 10 buyers already lived in Hollister, while four came from San Jose, and one person each moved from Grass Valley, Santa Cruz and Morgan Hill.

Intero Real Estate Vice President and Managing Officer Renee Kunz said that whether a buyer is looking for a home under $600,000 or over $1 million, the area is very competitive. She said there is still a need throughout the state for affordable housing.

“We still do not have enough houses for the demand,” Kunz said.

What does the future look like?

Pierce believes that because growth in San Benito County has been “slow but steady” rather than “straight up” as it was in the early 2000s, it is sustainable and there is no danger of a repeat of the Great Recession, partly because the market is being artificially held down.

“We should continue to grow slowly,” he said.

He said the number of homes under development are finally enough to attract more commercial projects, including the 130,000-square-foot shopping center along the Highway 25 bypass, as well as a recent purchase by a local commercial developer of 18 acres on the corner of San Felipe Road and the bypass that his agency sold after being listed for 25 years.

But the city of Hollister is now looking at setting the same limits as in the expired Measure U. As Prado noted to BenitoLink, on Oct. 25, the Hollister Planning Commission approved the recommendation to amend the General Plan Housing Element to include a growth management program.

“It will include an annual growth limit of 244 residential units or 2.16 percent growth per year,” he said, adding that the program includes exemptions that would require the construction of affordable housing and multifamily rental housing projects, among others, in the city of Hollister. This still needs final approval by Hollister City Council.

Pierce addressed the ongoing furor over housing and long commutes on the two roads leading out of the county. Even though the public perception is houses are springing up everywhere, many of the developments will take years to complete.  

“It’s a double-edged sword,” Pierce said. “The public says they don’t want more housing because they see what it’s doing to the roadways. They only want businesses. But one doesn’t happen without the other.”

 

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John Chadwell

John Chadwell is a BenitoLink reporter and an author. He has many years experience as a freelance photojournalist, copywriter, ghostwriter, scriptwriter and novelist. He is a former U.S. Navy Combat Photojournalist and is an award-winning writer who has worked for magazine, newspapers, radio and television. He has a BA in Journalism and Mass Communications from Chapman University and underwent graduate studies at USC Cinema School. John has worked as a script doctor and his own script, God's Club, was released as a motion picture in 2016. He has also written eight novels, ranging from science fiction to true crime that are sold on Amazon. To contact John Chadwell, send an email to: johnchadwell@benitolink.com.