Frequently Asked Questions
Demolition of Vallco Shopping Mall began on October 11, 2018. Workers are demolishing parking structures as part of the first phase of a multi-month effort to dismantle portions of the mall property. Demolition will prepare the site for future construction of an exciting town center project featuring shopping, housing, office, open space and entertainment uses. Visit our Demolition at Vallco page for more details.
The retail market has changed drastically. Major retailers are closing thousands of stores nationwide because shoppers no longer turn only to brick and mortar stores with the advent of online shopping. When people do go out to shop, they prefer retail settings with more to offer. Today, traditional regional malls are losing market share, and only a select few are surviving. In fact, no new mall has been built in the US since 2005.
For the last several years, Vallco has been ranked last amongst all regional malls in the South Bay and Peninsula and been unable to compete with other malls in the trade area. Vallco has become irrelevant as a retail-only mall in today’s market and remains a tired eyesore that doesn’t serve our community. The mall now sits nearly vacant. In March, AMC Theatres, one of the mall’s strongholds and greatest community assets, announced that it would also move out.
Every industry expert, including regional experts and independent consultants to the city, have agreed that Vallco cannot continue as a traditional retail-only mall. This was also confirmed by the City’s 2017 Speaker Series that provided expert testimony on the future of Vallco and other development-related issues.
We have 30 years of evidence. Some of the most reputable mall operators in the world, including the owner of Westfield Valley Fair, tried and failed. Vallco has not, will not and cannot be successful in its current form.
Since the 2016 election, we’ve been listening to the community. We have attended the City’s Speaker Series, City Council and Planning Commission meetings, as well as the initial community meetings for the City-led planning process. It is important to note that the Vallco Town Center project application is informed by years of community engagement on the future of Vallco. We are confident it will be successful and are proud to bring it forward for our community.
Vallco Town Center will look familiar to Cupertino residents, as it borrows heavily from the previous plan for the revitalization of the mall. Vallco Town Center retains the same urban design features, including the rooftop park and town squares of earlier plans, which will create a dynamic space for community events and gatherings. With 400,000 square feet of retail and entertainment uses, the project will rejuvenate the vibrant retail scene at Vallco, with the return of the AMC Theaters, the retention of an ice rink and bowling alley and the development of a true downtown. In order to make the project economically viable and sustain the significant requirement of affordable housing and to support the retail environment, the project also has a 1.81 million square feet office component.
Vallco Town Center will deliver a viable housing-focused plan within a reasonable schedule of completion thanks to the streamlined approval process through SB 35.
“The Hills at Vallco” was suspended after the 2016 election. In October 2017, we asked the Cupertino City Council to re-open the planning process for a revitalized Vallco. We invited the City to study our “the Hills” application, alongside a number of project alternatives that would offer a greater response to the region’s housing crisis, by increasing the number of residential units and decreasing the amount of office space that was originally foreseen in “the Hills.”
The Vallco Specific Plan process, which studies “the Hills” and a number of project alternatives, is currently in progress. While SB 35 requires the Vallco Town Center project application to be processed and approved pursuant to statutory timelines set forth in the legislation, Sand Hill Property Company, the owner of Vallco Mall in Cupertino, does not intend for its SB 35 application to upset the ongoing planning process.
Sand Hill hopes that the City process is successful in yielding a project that is derived from the community and addresses housing while also being viable. However, absent such an alternative, Vallco Town Center offers a viable, housing-focused plan for the dead mall and will allow to get started on a feasible project with a reasonable schedule of completion.
Vallco Town Center will help the region and the City add housing options at all price points and mandates that 50% of the units be affordable. We are especially proud that, with this application, we have been able to maintain many of the community-supported attributes of our previous “the Hills at Vallco” plan, like the rooftop park and entertainment district, while adding housing, increasing affordability and reducing office space from earlier plans.
On September 19, the City Council voted 3-2 to adopt Tier 2 of the Vallco Specific Plan. However, in October a small group of residents submitted signatures for a Referenda to stop the City of Cupertino-approved Community Plan. Despite an effort by Sand Hill Property Company to ensure residents understood the risks of submitting a Referenda, this group persisted in its efforts to delay the project at Vallco.
Due to these actions, we’ve officially reached the end of the line for the Community Plan. The cost to the city is tremendous, both in terms of lost community benefit facilities and dollars, as well as the costs associated with continued delay as voters wait for an election in November 2020, providing the City holds one. This latest obstruction, and the two-year delay it causes, gives the Community Plan no chance to catch up to the already approved and under-way Vallco Town Center project. We consider ourselves patient people, but our patience has finally run out.
Now, we are focused on delivering our fully-approved project, called Vallco Town Center, made possible by the State’s new housing development streamlining law, SB 35.
Senate Bill 35 went into effect on January 1, 2018, as a response to the state’s housing crisis and one of its main causes—the failure of many jurisdictions to approve housing development resulting in record low inventory being added to the market at a time of record growth. With SB 35, the state aims to increase the supply of market rate and below-market rate housing in California, by creating a streamlined “ministerial” approval process for projects that meet the requirements of the legislation.
The law is tailored to cities and counties in California that failed to meet their Regional Housing Needs Allocation (RHNA), which is the number of housing units each city or county must provide in its state-mandated Housing Element. This is the case for Cupertino.
Visit the SB 35 Explainer page for more details.
A lot has changed since we proposed The Hills at Vallco in 2015. While housing was sorely needed, the demand for it has dramatically increased. In addition, the City’s 2017 Speaker Series confirmed that the housing shortage is real and that Cupertino, along with some other cities in the region, has not done and is not doing enough to address it. A thoughtfully conceived mixed-use plan at Vallco can provide solutions to these issues.
Cupertino currently provides only one affordable housing unit for every 14 of its low-income jobs — one of the most egregious ratios in the Bay Area – and it’s only getting worse: two thirds of Cupertino’s own “below market rate” rental housing stock, totaling 142 units, will convert to market rates within the next decade, and the City has yet to permit a single low or very low income unit from its now 3-year old Regional Housing Needs Allocation.
The intent of SB 35 is to alleviate these housing and affordability problems so the well-being of the State and its regions can be safeguarded. Vallco can and must be a substantial part of that solution.
In order to make Vallco Town Center an economically viable project and in order to sustain the significant requirement of affordable housing under SB 35 and to support the retail environment, the project has a 1.81 million square feet office component.
Office space is needed for two main reasons. In order to achieve Vallco’s second life is as an experience-based, people-friendly destination, a daytime population is needed to give retail businesses the customers they need to succeed in this new digital age. That means providing Cupertino residents more housing near places of work.
Secondly, office is needed in order to make Vallco Town Center an SB 35-compliant economically viable project. SB 35 requires 50% of the housing onsite must be affordable. In this project, that means 1201 designated affordable units. Since there is no government subsidy, 1.81 million square feet of office is needed to pay for the affordable housing. In addition, office also required to subsidize the retail component.
The Vallco Town Center plans include approximately 400,000 square feet of retail and entertainment uses on the site. The project will rejuvenate the vibrant retail scene at Vallco, with the return of AMC Theaters, the retention of an ice rink and bowling alley and the development of a true downtown.
We are prepared to engage with the City and the community about the types of public improvements and community benefits that can be incorporated throughout the process, as we have done consistently over the past several years.
It is important to note the Vallco Town Center project application is informed by years of community engagement on the future of Vallco. We are confident it will be successful and are proud to bring it forward for our community.
While we are ready, willing and able to construct Vallco Town Center, we wish to reiterate that, as the City continues its Specific Plan process, we intend to remain open-minded in the event that the City advances and environmentally clears an alternative project on a reasonable timeline.
As the Vallco Town Center plan has not formally been approved, we are not currently taking reservations for housing units. However, if you’d like to be included on a list for future outreach and have your name placed on the interest list please email email@example.com.
Demolition of Vallco Shopping Mall began as of October 11, 2018. Workers are demolishing parking structures as part of the first phase of a multi-month effort to dismantle portions of the mall property. Demolition will prepare the site for future construction of an exciting town center project featuring shopping, housing, office, open space and entertainment uses.
Visit our Demolition at Vallco page for more details.