SummerHill Tries “Builder’s Remedy” for San Jose Townhomes

SummerHill Housing Group has used the state’s “builder’s remedy” legal strategy to fasttrack 143 townhomes in North San Jose.

The San Ramon-based developer has filed plans to build the three-story homes at 150 River Oaks Parkway under the three-decade old state housing loophole, the San Jose Mercury News reported. They would replace a 100,000-square-foot office and research building.

Plans call for 143 townhomes in two dozen buildings on the 5.7-acre site at North First Street and Zanker Road, next to the Intel Innovation Campus. The property is owned by Maevo Group USA, based in Milpitas.

SummerHill aims to employ the builder’s remedy, a legal provision of the 1990 state Housing Accountability Act that was all but forgotten until last year. The so-called “nuclear option” serves as a penalty for cities that fail to meet their state-mandated housing goal deadline, allowing developers to bypass local zoning if their projects include enough affordable housing.

The untested legal tactic was first employed last year in Redondo Beach and Santa Monica in Southern California, as covered by The Real Deal, with ramifications for the Bay Area.

An estimated 20 percent of the townhomes proposed by SummerHill in North San Jose would be “deed-restricted for lower-income households,” Bryan Wenter, an attorney for Miller Starr Regalia, said in a letter to city planners on behalf of the developer.

He said a “builder’s remedy” approach could pave the way for a streamlined approval — and not require a general plan change.

His letter cited court rulings, legal precedents, interpretations of state laws and warnings that the city could be subject to fines if it unlawfully obstructs the townhome project.

The project, designed by Brentwood-based SDG Architects, would be sheathed in white, with gray and Cape Cod-blue clapboard panels, with balconies, according to a rendering.

It adds to nearly three dozen “builder’s remedy” projects filed by Bay Area developers to skirt local zoning in 11 cities and counties to build more than 6,400 homes.

Of the Bay Area builder’s remedy projects, 15 are proposed in San Jose, five in Mountain View, three in Palo Alto, three in Los Altos Hills and two in Brentwood, plus a project each in Menlo Park, San Mateo, Pleasanton, Sonoma, Fairfax and Marin County.

Many of the builder’s remedy proposals aim to build in upscale areas that have long opposed large housing projects. One reason developers target wealthy cities is they can charge higher rents and sale prices to offset the cost of the affordable homes.

SummerHill Housing Group is among eight companies founded by brokerage Marcus & Millichap, based in Calabasas.Since 1976, SummerHill has completed more than 80 developments containing more than 6,000 single-family homes, condominiums, townhomes and apartments across the Bay Area, according to its website.