Neighbors raise questions about San Jose apartments tied to city deal
SAN JOSE — A San Jose neighborhood group is questioning a downtown apartment project that is tied to a deal that includes the city’s purchase of a historic building. City planners on Wednesday delayed their approval of the housing proposal, which would produce 276 units.
Real estate firm Urban Catalyst, owner of the Knox-Goodrich building at 26 through 36 South First St., has proposed the development of an eight-story apartment complex at 470 West San Carlos St. known as The Gifford.
San Jose planning administrators initially were set to approve the apartment complex on July 8. That was deferred one week. After a second deferral on Wednesday, the issue will come up again on July 22.
Stakeholders + Neighborhoods Initiative, a group formed by some residents, raised concerns in a July 3 letter to the city about the project on the western edges of downtown.
“This neighborhood is not opposed to housing,” said Kathy Sutherland, co-president of Stakeholders + Neighborhoods. “We have supported hundreds of affordable and supportive housing units within two blocks of this property.”
Stakeholders + Neighborhoods believes the project contains some unwelcome design features, including a section of the new building that would be directly next to existing single-family homes.
“Urban Catalyst proposes an eight-story building that, by the city’s own analysis, is ‘a building with no setbacks’ at the shared property line with our homes,” Stakeholders + Neighborhoods wrote in the letter.
The group noted that typical design guidelines in downtown areas near the Diridon train station require projects to have a step-back arrangement so they don’t loom over existing homes.
Urban Catalyst declined comment on the situation.
The San Jose City Council gave preliminary approval on June 16 to a plan that would have the city pay an Urban Catalyst affiliate $3.6 million for the Knox-Goodrich building. In return, Urban Catalyst would begin construction in 2027 of the apartment complex, city documents show.
San Jose officials believe the purchase of the historic building and development of The Gifford would greatly benefit the city’s downtown district.
“The Gifford, along with Urban Catalyst’s Icon-Echo Apartments, Gateway Residential Tower by CORE Developers, and the Bank of Italy conversion to residential units by Westbank, will spur a revitalization” in downtown San Jose, city staffers wrote in a memo to the City Council.
Councilmember Anthony Tordillos said at the June 16 meeting that the deal will help the city achieve its housing goals and noted that San Jose is buying the building for 60% less than what Urban Catalyst paid.
“This is a slam dunk for the city,” Tordillos said, emphasizing San Jose in 2025 hit only 33% of its targeted mandate for the creation of new housing units. “We need all the housing we can get.”
Erik Solivan, San Jose’s housing director, said the deals would proceed separately and with sufficient scrutiny.
“These two things are bridged together, but they are not in any way tied together,” Solivan said. “Approval of one does not fast-track approval of the other.”
City officials are already planning how to make use of the historic building.
“Once acquired, staff will activate the ground-floor storefront in the historic Knox-Goodrich building with a cultural-serving or commercial use,” city staffers stated.
