By Janice Bitters – Silicon Valley Business Journal, November 21, 2017

The city of Cupertino tonight will vote on whether or not to hire a consultant to make a new specific plan for the Vallco Shopping District Special Area, a roughly 58-acre site where the nearly-empty Vallco Shopping Mall currently stands.

The vote is significant because it would kick off planning efforts to restart development at Vallco Mall – a controversial subject in the city for years. But it comes at a tenuous time for Cupertino and for the Vallco site as council members juggle two controversial issues related to the city’s general plan.

One of those issues is the vote at hand Tuesday, spurred by a request from Vallco owner Sand Hill Property Co. to study a slew of options and update the plans for the shopping mall site. Community concerns stalled development on the property last year, but the Palo Alto developer now wants the city to study several mixed-use options for the site to provide guidance for future development through an updated specific plan.

However, some council members say first the city should preemptively change the general plan reducing the allowable development on the Vallco site to combat the impacts of a newly passed state housing bill, known as SB 35. The bill is aimed at streamlining the approval process for housing in California and goes into effect on Jan. 1.

Vice Mayor Darcy Paul said at a public council meeting on Nov. 7 that he worried that the existing office and retail allocation for the site in the current general plan would trigger automatic approvals of hundreds of thousands of square feet in housing when the new bill goes into effect.

“An office allocation can still be put forward in a specific plan, it’s just that we would then have the right to approve it,” he said at the council meeting. “If we don’t act quickly enough then we are going to potentially relinquish this right.”

Paul did not immediately return a request for comment about the vote on Tuesday.

But some on the council earlier this month seemed split on whether working to change the general plan before the end of the year would meet the community’s demands for transparency.

Council Member Barry Chang was the most vocal of that group. “Knowing this community, enough time [for] outreach is very important,” he said. “I would say do it right instead of do it rushed.”

Sen. Scott Wiener, D-San Francisco, who authored SB 35, chimed in on the discussion last week, saying that he hoped Cupertino wouldn’t “take this anti-housing step,” to reduce existing allocation for development in the general plan.

“Cupertino, where Apple has its ever-expanding [headquarters], is considering down-zoning in order to scale back a large mixed-income housing development and avoid application of my housing streamlining bill,” he tweeted on Nov. 16 along with a clip of the council’s conversation on the matter.

Sand Hill’s options

For Sand Hill’s part, the group is eager to start studying options to replace the 1.2 million-square-foot shopping center, Sand Hill Managing Director Reed Moulds said in an interview Tuesday, adding that he’d think it as a success to see the council approve hiring the consultant to begin studying those options.

“What I’m looking for is a message from the leadership of Cupertino that there won’t be any game-playing in this process and releasing the contracts tonight at the staff’s recommendation,” he said, adding that the new discussion about the housing bill and reducing the allowed development at Vallco in the near-term “a bit of a red herring.”

“There are forces in Cupertino that take any opportunity to impose their will,” he said. “It’s those forces that are trying to make this a Vallco issue and distract people from the real issue, which is that Cupertino is out of compliance with the state’s housing laws.”

Among the options that Sand Hill is asking to be studied is its original — albeit controversial — vision for the 58-acre property at 10123 N. Wolfe Road: A mixed-use village called the Hills at Vallco with up to 2 million square feet of office space alongside 625,000 square feet of retail and 800 residential units. Above it all would sit a 30-acre green roof — a place making feature for the development. That plan was technically in compliance with the city’s existing general plan, but community pushback halted the plan last year.

Another of the group’s suggestions would fill the site primarily with housing. The third option to be studied would essentially balance the amount of space dedicated to each use. The company is also required by law to study the impacts of doing nothing to the property.

Whatever the direction development on the site takes, Moulds on Tuesday reiterated earlier statements that the site should include a mix of housing, retail and office space to pencil out, given the 600,000 square feet of retail currently required for the site and local affordable housing goals.

Moulds said he believes support for a new, mixed-use development at Vallco has increased in the past year.

“Most people in Cupertino are really talented, thoughtful, responsible people that want to see the process work, and that want to see everybody involved and sharing their input,” Moulds said. “At the end of the day, they really want to see Vallco revitalized.”