The Village project was a multi-building development to be located at the site of the Craftman’s Mall, off of St. Louis Road on the west side of 101 (to the south of the L.K. Wood overpass). Originally envisioned to be 100% student housing of about 600 beds, the project went through numerous alterations and a variety of iterations as part of the public review process.
The Village project was never built. The foundation connected with the recently-transitioned (2022) Cal Poly Humboldt University has purchased the site and plans to have an 800-bed facility there with a completion date of 2024.
After a 1-1/2 year process of public meetings, multiple Planning Commission meetings, and too-many City Council meetings, the Village project appeared as though it was ready for approval by the City Council on June 6, 2019. But by mid-May, 2020 – almost a year later – the developer withdrew their application, and that ended the project.
Community Development Director David Loya has repeatedly pointed to the fate of the Village project as an example of the dysfunction of the Arcata’s current Euclidian building codes — (i.e. standard building codes, as opposed to Form-Based Code) and the need for Arcata to adapt a Form-Based code with ministerial review for the 138-acre Gateway plan. Mr. Loya has insisted that a Form-Based code and ministerial review process is necessary so that future developers are not potentially subjected to a lengthy, expensive, and ultimately unproductive process such as was seen on the Village project.
We believe that it was NOT the lengthy review process that had the developer pull the plug on the Village project. It can be considered as fact that the process was long, that it was expensive for the developer, and that it was difficult. But the project was ready for approval. No, the difficulty of approval was not what killed the project.
And to continue to say so is disingenuous.
Why a Form-Based Code would have helped
Under a Form-Based Code, a developer would have a more-clear idea as to that the City wanted for development at a certain site, and could more cohesively design the project to be aligned with the City’s desires.
But Form-Based code does not mean we also couldn’t have Planning Commission Review. Form-Based code is not linked hand-in-glove with Ministerial Review — despite allusions and statements by David Loya that, by necessity, they are.
“Ministerial Review” has it be that review of a development can be done by a single person in the Community Development office. At his or her option, a project could be opened up to Planning Commission / public review approval. But it would be up to the Director or Zoning Administrator (or his or her assignee) to approve a project. “Discretionary Review” involves public input and approval by the Planning Commission (and, prior to its dissolution in March 2020, Design Review Committee approval).
For a article on this website Ministerial and Discretionary review, click here.
In many conversations and writings, Community Development Directory David Loya has insisted that a Form-Based Code requires ministerial review — and without ministerial review there’s no point to even having a form-based code.
“In my professional opinion, the effort involved in developing a form-based code is lost on discretionary review.”
“Why invest the time and energy into a master plan now if it is going to be modified on a project by project basis in the future? The point of this process is to give certainty to the community now about how the streetscape could look if it is developed. If we are going to allow future decisions to affect the outcomes, then there is really no purpose to investing in uncertainty.”
At the April 12, 2022 meeting of the Planning Commission, Vice-Chair Judith Mayer pointed out that it is possible to have a beneficial, complete Form-Based Code — describing streetscapes and building designs and community preferences — and also have the public input / Planning Commission review process. The one is not dependent on the other. In the example of Redwood City’s Downtown Precise Plan, there is Ministerial review for small projects that meet the Form-Based Code and Discretionary review (i.e. public input, Planning Commission review) on larger projects. See articles on Redwood City here on this website. Here’s the link for the April 12, 2022 meeting of the Planning Commission.
But what did happen ?
An analysis of how David Loya has presented the fate of the Village project is one person’s assessment of what happened. There are many explanations of what happened. The truth is: There is no publicly-known explanation of why the developer stopped the project – almost one year after it was approved. One thing that’s likely, though is this: It wasn’t because of the length of time or the difficulty of the approval process.
One explanation is this:
The developer, AMCAL of Agoura Hills, California (https://www.amcalhousing.com/), is in the business of creating affordable housing, workforce housing, market-rate housing, and student housing. As originally designed, this was to be a 100% student housing project. The idea was that AMCAL would build it, the university would manage it, and at some point the university foundation would purchase it. This is a business model that they have used in the past, such as the 579-bed student housing development adjacent to the Cal State Monterey campus. The project was built by AMCAL and the university foundation purchased it, about two years after it was competed. “The university had a 20-year master lease with an option to purchase after the first 12 months that it chose to exercise,” said Percival Vaz, CEO of AMCAL.
How did it go in Monterey?
The Monterey County Weekly reported that AMCAL had made a 55% return on its investment in two years, a figure that was disputed by AMCAL.
The Weekly originally reported, that based on publicly available numbers, AMCAL could have yielded a 55 percent return on investment over two years.
The percentage was based in the original $44 million cost of the Promontory given by the city of Marina. An AMCAL spokesperson refused to give AMCAL’s development costs but said numbers given by Marina were likely accurate.
David Moon, of AMCAL’s financial partner Monterey-based Coleraine Capital, disputes the 55-percent return on investment reported by the Weekly. Publicly available development costs only make up 70 to 75 percent of total costs, Moon writes in an email.
“The University Corporation smartly negotiated a very favorable below market option price when they signed the master lease for the buildings,” he continues by email.
Moon would not give further information on the Promontory deal, saying he has a “fiduciary responsibility” not to disclose financial information.
Note: Mr. Moon’s rough figures would indicate a profit of 9% to 17% for the two years. It seems unlikely that a business model would be based on a 4% per year return on investment.
AMCAL’s business model for Student Housing
AMCAL seems to be a good developer, and this business model seems to be a good business model that could have been of benefit to everyone.
(Everyone, except, perhaps, to the workers who do the construction. Here in Arcata, Cal Poly Humboldt (the foundation) purchased the Craftman’s Mall property and will be constructing student housing on that site, much like the original AMCAL development. When the university constructs a project, they are required to pay “prevailing wages” to the workers. If a private developer constructs the same project, he does not, and the project’s cost can be lower.)
The project was approved. So why was it killed ?
The Village project was given a consensus approval — finally — by the Arcata City Council at its June 5, 2019. But 11 months later the developer withdrew, and ended it.
In the changes from how it was originally presented, the project moved from being all-student housing to being a mixed-development with both housing for students and housing also for local non-student individuals, groups, and families. By one theory, this would have substantially changed the interest of the university in purchasing the project. Based on statements from project applicant David Moon of Coleraine Capital Moon, a partner of AMCAL, HSU decided not to be directly involved in the project as a result of the mixed-housing component, as the university cannot manage a housing development that includes non-students. Without it being 100% student housing, it’s likely that the university foundation could not buy it.
We don’t know what was going through the minds of the developer. The project did not become watered down” as David Loya has described. It became a different project. If they were aware at the time that they were not willing to take on this other project – one which would not be managed by the university, and not sold to it – then they should have made that clear as part of the process. The project was approved, and 11 months later, they cancelled it. We can only speculate why, but a strong possibility is that it simply did not fit into their business model of constructing student housing which would be sold to the university.
There are certainly other takes on what exactly happened to put an end to the Village project.
Looking back, having a project in Arcata for 392 students and 100 market-rate apartments would have been a benefit to the community. While the design process can be agreed to have been long and involved, it does not seem to be the case that the developer backed out because the length of the design process. Other factors seemed to have been at play – but without further information from AMCAL or Arcata’s Community Development project, any speculation is only just that.
We will likely never know.
For further reading — and excerpts from those articles:
On this website:
For an article on this website Ministerial and Discretionary review, click here.
Other general articles on ministerial review, see here.
To read how Redwood City designed their Form-Based code, see articles on Redwood City here on this website. NOTE: They took about 3 years to develop their Form-Based Code.
Here’s the link for the April 12, 2022 meeting of the Planning Commission.
Local Media:
There was a great amount of contemporary reporting on the Village project.
https://lostcoastoutpost.com/2020/may/22/village/ along with 14 other articles and videos in the Lost Coast Outpost.
THE VILLAGE IS DEAD: Developers Withdraw Application for Proposed Arcata Housing Project, Which the City Council Has Been Debating for Years
Arcata Community Development Director David Loya told the Outpost that he checked in with the applicant, AMCAL, last week and got a message that they were no longer interested. Loya said that he received no explanation as to why.
“A year ago they were still gung-ho about the project,” Loya told the Outpost over the phone, adding that the developers told him they had already invested over a million dollars into the project. “This isn’t something they would walk away from lightly.”
Village no more: Disputed Arcata housing project won’t move forward
https://lostcoastoutpost.com/2019/jun/6/arcata-city-council-village/
KUMBAYA! For Once, the Arcata City Council Sees a Version of ‘The Village’ That All Its Members Can Get Behind
Reporting on the June 6, 2019 City Council meeting:
After coming before the council many times and going through several design changes, the Village project was, once again rejected by the council at a meeting in April. Developers AMCAL have since come up with yet another design concept, which was brought before the council Wednesday. The newest redesign includes a mix of 122 student-only units — which include a total of 392 beds — and 100 open-market apartments.
“We believe what we’re presenting to you at this point is consistent with what all four council members were looking for in terms of the broad parameters,” developer David Moon said during the meeting. “In terms of rolling up our sleeves and working on the particulars, we’re ready to do that and we’re excited to do that.”
Unfortunately – (quoting from the same article):
During the April meeting, it was brought to the council and staff’s attention that AMCAL had hired the company that drafted the EIR for the project, something that should not have been permitted. As it turns out, an amendment to Arcata’s land use code requires that any outside firm drafting an EIR must be hired by the city.
Arcata Community Development Director David Loya explained to the council that although no CEQA laws had been broken, staff had not followed the land use code. In order to correct this error, the council directed staff to hire an outside consulting firm to examine the EIR and draft any future EIRs for the Village project.