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Home Developer Offers Concessions In Rancho Peñasquitos Project

The entrance sign to the Peñasquitos Village housing development in Rancho Pe...

Photo by Katie Schoolov

Above: The entrance sign to the Peñasquitos Village housing development in Rancho Peñasquitos is seen here, Aug. 14, 2017.

Home Developer Offers Concessions In Rancho Peñasquitos Project

GUEST:

Andrew Bowen, metro reporter, KPBS News

Transcript

Peñasquitos Village is a quiet residential community wedged between Black Mountain Park and Interstate-15, with pine and eucalyptus trees providing shade for the 332 single-story homes. Some of the homes are vacant, but a sign posted in the window of the leasing office politely states no new rental applications are being accepted.

In April 2016, the property owner, Atlantic & Pacific, sent out letters informing its tenants that it was seeking to demolish the homes and build new ones. The letters set off a year and a half of pushback from neighborhood activists seeking to stop the redevelopment plan from being approved by city officials.

The plan, branded Pacific Village, was abruptly taken off the agenda of the city's Planning Commission in September. Now, Atlantic & Pacific and its development partner, Lennar Homes, are touting changes to the plan that they hope will win over skeptics at the project's rescheduled hearing on Thursday.

"We listened to elected officials, community leaders and the residents and neighborhood, and started making changes to the plan that will incorporate two main things," said Kim Arnold, a regional supervisor with Atlantic & Pacific. "The first is the affordability component."

RELATED: Experts See 'Perfect Storm' Descending On San Diego Housing Crisis

The developers have agreed to reserve 60 of the 600 homes in Pacific Village for low-income residents, and to charge them below-market rents. This fulfills the city's rule that 10 percent of new housing development be designated affordable — something developers often get around by paying a so-called "in lieu" fee. Previously, the project had 28 affordable homes, with the developers opting to pay the fee to make up the difference.

The second change to the project is a relocation package being offered to the current tenants. All are getting a discounted rate with a local moving company, and free moving boxes and packing tape.

Those who moved in prior to the April 2016 notices — about 40 percent of current tenants — are being offered a cash payment to help cover 18 months of what will likely be a higher rent at a new home. An agreement to keep the homes priced below market rate expired in 2010, but tenants have continued to pay relatively cheap rents because the homes are nearly 50 years old and lack modern amenities like dishwashers and air conditioning.

In addition to the cash payments, Atlantic & Pacific has pledged to spend extra time helping its most vulnerable tenants: those who receive federal Section 8 housing vouchers. It is setting aside apartments in other properties it owns and manages for the voucher holders, and those voucher holders will get first dibs on the 60 low-income homes included in the redevelopment plan. Atlantic & Pacific says construction will not start until all 80 voucher holders have found a new home.

"This relocation program is really something that is unheard of in this type of development," Arnold said.

Renderings illustrate the homes of the Pacific Village project proposed for Rancho Peñasquitos.

The changes are encouraging to some activists — but not everyone has been won over.

"I see this as victory in the battle for preserving affordable housing in Peñasquitos, but I don't see it as the entire compromise that can be had," said Melinda Vasquez, a Rancho Peñasquitos resident who has organized against the Pacific Village project.

Atlantic & Pacific says both the apartments and for-sale homes in Pacific Village will start at prices below the median price for newly constructed homes. Vasquez says that would still be unaffordable for most middle class San Diegans, more than half of whom are considered burdened by the region's astronomical housing prices.

Kris Arciaga,

Vasquez said she understood that Atlantic & Pacific and Lennar are not charities, and are just trying to make a profit. But she said it was up to city officials to keep them in check.

"Government is supposed to be in existence for the people, to help make sure … that we have a community plan, that we know how we're going to build out," she said. "Because left to their own devices, developers, or people in for-profit businesses will do whatever is in their own best interest."

Arnold countered that the main reason for San Diego's housing affordability crisis is a lack of new housing supply that, coupled with a growing population, has led to low vacancy rates and bidding wars over scarce homes. She said Pacific Village, which would create a net increase of 268 homes, is exactly the kind of project San Diego needs.

"The space is underutilized," she said. "In order to be a part of the solution for San Diego, you need to bring more density into these particular projects, project infill development areas. And we think Pacific Village does that."

Pacific Village is scheduled for an initial hearing at the San Diego Planning Commission, which can make a recommendation on the project's approval. The final decision rests with the City Council.

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