Amy Reinholds
The line snaked through the promenade between shops at La Cumbre Plaza on Wednesday night, Jan. 17, almost to the old Sears building, but people weren’t waiting to get into a going-out-of-business sale or an arts event. They were waiting to get into the open house for a new mixed-use development proposed for the Macy’s site and adjacent parking lot after the department store’s lease ends in 2028.
Proposed plans for “The Neighborhood at State & Hope” on the 8.7 acres owned by Jim and Matthew Taylor and MCP Santa Barbara LLC currently include 642 residential rental units, as well as shops, restaurants, and community space. The Taylors and architecture companies working on the plans hosted the open house at the Grace Fisher Foundation Inclusive Arts Clubhouse space at La Cumbre Plaza, south of the site being discussed.
During the open house, nearly 300 people signed in at the door for updates on the project, according to the open house organizers. Others didn’t sign in, but by the end of the two-hour event, there was no longer a line.
Like most housing issues, the story of this proposal isn’t as simplistic as “yes in my backyard” (YIMBY) versus “not in my backyard” (NIMBY) neighbors. And with construction not expected to start for at least four years, it’s going to be a long story.
People may have decided to show up for a variety of reasons, including to oppose or support the project, for the free food, to give their input, or to just to learn more. There will be more meetings, and plans will probably change after each one, but here’s a quick list of what I learned at the open house.
1. This proposal is only for the Macy’s building and parking lots, not all of La Cumbre Plaza.
La Cumbre Plaza is a total of 31 acres and has been included in the City of Santa Barbara’s 2023-2031 Housing Element plan in a list of suitable sites for new housing.
As I was standing in the Inclusive Arts Clubhouse space, I was imagining the sketches I was viewing of retail spaces, live-work lofts, restaurants, and residential rentals would be built on top of where I was standing. But then I saw the “you are here” map. Only the portion of La Cumbre Plaza with the Macy’s building (3805 State Street) and adjacent parking lots, an 8.7 acre site, is proposed for this “Neighborhood at State & Hope” mixed-use development.
The portion to the south of Macy’s, starting where Lure and Pottery Barn are now—including where we all were standing in the Inclusive Arts Clubhouse space—marks a long-term mall lease that doesn’t end until 2077, so it’s not part of this proposal.
Also important to note, another parcel to the south that includes the old Sears building is owned by Riviera Dairy and includes the old Sears building. Any proposed development there will be a separate project before the city.
2. This proposal isn’t new.
More than a year ago, in December 2022, the developers, Jim and Matthew Taylor, a father-son team from Santa Barbara, and MCP Santa Barbara LLC, submitted the first pre-application documents to the City of Santa Barbara, using a streamlined path made available under California Senate Bill (SB)-330, the Housing Crisis Act of 2019. MCP Santa Barbara LLC purchased 15 acres of the La Cumbre Plaza’s 31 acres about a year earlier in November 2021, but this proposal is only for 8.7 acres, as described in the section above. MCP is a partnership led by Jim and Matthew Taylor, backed by the Mandrake Capital Group.
The Taylors together have more than a 50-year history living in Santa Barbara with experience in hotel, commercial, and multifamily real estate development throughout South Santa Barbara County, California, and the Western United States. Jim Taylor was involved in the developments including Montecito Inn, Camino Real Marketplace, and Maravilla, and his son Matt joined him in the business in 2015.
In November 2023, the developers submitted updated preliminary application materials to the City of Santa Barbara and requested additional feedback on the project layout, which was revised to address initial comments. The updated proposals at the open house included 642 residential rentals—588 market rate and 54 deed-restricted to have affordable rents for individuals and families with annual incomes in the low and moderate categories (more in the next section).
These residential unit totals are down slightly since the earlier documents given to the city planning department proposing 685 residential rental units. Also in December 2022, the Santa Barbara County Association of Governments (SBCAG) rejected the City of Santa Barbara’s request for $1.1 million in state funds for a two-year master planning process for the entire 31 acres of La Cumbre Plaza. Now projects like this one can go through the city process separately instead of in one integrated plan.
At the Jan. 17 open house, there was also more visibility into 845 residential parking spaces underground, 105 retail parking spaces, a network of pathways and passageways, the types of buildings, and how they would be arranged on the site. Architects from local Cearnal Collective and partner architects from Northern California, David Baker Architects, as well as civil engineers from Flowers & Associates explained proposals and sketches on display, answered questions, and collected input from visitors.
3. State law determines the current number of subsidized affordable rents for 54 of these apartments.
The City of Santa Barbara’s Average Unit Size Density program requires projects of ten units or more to provide at least ten percent at rental rates affordable to moderate-income level households.
On top of that, the California Density Bonus Law includes tables of different percentages of additional density bonuses to allow more market-rate rentals that can be granted if developers include certain percentages of deed-restricted rentals affordable to low-income level households, very-low income level households, and moderate-income level households.
So what does each of these levels of household income mean? The levels of income are based on a household’s income relative to the area median income (AMI) of Santa Barbara County, also considering the size the household. The AMI changes every year, so by the time this project is built, the area median income will have changed again. As you can see in the 2023 table, the median income for a single-person household is $75,110 and the median income for a family of four is $107,300. The very-low income level is 50 percent of the AMI, which means up to $51,800 for a single-person household or up to $73,950 for a family of four. The low-income level is between 50-80 percent of the AMI, which means up to $82,950 for a single-person household or up to $118,500 for a family of four. The moderate-income level is between 80-120 percent of the AMI, which means up to $90,132 for a single-person household or up to $128,760 for a family of four.
So what would a subsidized affordable rent be for these households? Federal, state, and local housing assistance programs consider housing affordable to a household if less than 30 percent of a household’s gross income is spent on housing costs (including rent and utilities). Examples of subsidized affordable rents in a new housing development managed by the Housing Authority of the City of Santa Barbara at 821 State Street are $965 for a single-person with income up to $82,950, which is 80 percent of the AMI or low-income level. Rents are $1,610 for a single-person with income up to $90,132, which is 120 percent of the AMI.
The workshop included a map that showed the site’s location in between the county’s largest employers, and the Taylors have talked about the importance of providing market-rate “workforce” rentals, which is a different type of “affordability” if small units provide more market-rate rents that are closer to what employees of local jobs can afford without paying more than 30 percent of their gross income on rent and utilities. For example, rent of $1,900 for a studio apartment might be less than 30 percent of a 2-person household’s gross income, which makes it affordable for that couple for the year after the lease is signed, but it’s not guaranteed stay at that rate. Market-rate rents that aren’t subsidized can go up when the market goes up.
One of the architects at the open house said that people were asking how they could get on a list to rent the new apartments at State & Hope, but there’s no waiting list available during this phase of the proposal. If you’re looking for affordable rentals and your income falls in the moderate or lower income levels of AMI, it’s best to get on all the lists for all the affordable rentals with the housing authorities: Housing Authority of the County of Santa Barbara and Housing Authority of the City of Santa Barbara. If you wait for the Neighborhood at State & Hope to be constructed, you’ll be waiting several years before an application process even begins.
4. This proposal waives the City of Santa Barbara height restriction with four center buildings with six stories
The California Density Bonus Law allows this project to waive the City of Santa Barbara height restriction. According to California Density Bonus Law, Section 65915-18, height restrictions are one of several limitations that a developer might consider requesting a waiver for. Based on presentations at the open house, four of the buildings have sections that are proposed for 6 stories. The developers have requested a waiver to go as high as 76.5 feet, which is 16.5 feet above the Santa Barbara City Charter Section 1506’s limit of 60 feet for commercial development.
According to the City of Santa Barbara press release, “‘The Neighborhood at State & Hope’ proposal allocates 5% of its housing units to very low-income households, entitling it to certain waivers under the State Density Bonus Law. In compliance with this law, the project has requested a waiver to exceed the City Charter’s 60-foot height limit by 16.5 feet to accommodate the increased density allowed under State Density Bonus Law.”
The California Density Bonus Law has been in effect since 1979 and has been applied in the courts to other charter cities like Los Angeles, San Diego, and Berkeley.
5. Water for this project will be allocated through the City of Santa Barbara water agency.
The City of Santa Barbara has its own water agency. Water Supply & Services Manager Dakota Corey recently told the Santa Barbara Independent that the city has projections of water use, population, housing growth, and the economy out as far as 2050 that point to the city’s desalination plant meeting demand.
6. Whatever happens, it’s going to take a long time
Macy’s has a lease to continue its store in the same building at La Cumbre Plaza until 2028. Also, the southern parts of La Cumbre Plaza that aren’t part of this project have a lease for the existing mall and shops until 2077.
Both the City of Santa Barbara La Cumbre Plaza Redevelopment web page and the developers’ Neighborhood at State & Hope project website provide timelines. Here’s the estimated timeline that was presented at the open house.
Construction can’t start until the Macy’s lease ends in 2028. At the open house, it was estimated that people probably wouldn’t be living there until as early as 2030, most likely 2031 or 2032.
Here are the next steps:
There are two upcoming City of Santa Barbara meetings to watch for:
- An Architectural Board of Review meeting is expected in February for the Preliminary Concept Review. State law requires early input from the applicable design review board before the formal application is submitted.
- A Planning Commission meeting in March for the Concept Review. State law requires early input from the Planning Commission before the formal application is submitted.
The city anticipates a formal planning application for the proposal will be submitted in the first quarter of 2024.
According to the city’s La Cumbre Plaza Redevelopment web page, this formal planning application starts the “application completeness process.” After the application is determined to be complete for processing, the case planner will start the environmental review process for the project. Then, the project will go to the Planning Commission for consideration.
Thank you for the comprehensive report.
Thank you for this, Ms. Reinholds. As a longtime Santa Barbaran who holds our mountain and ocean views sacred, I don’t approve of this behemoth project. A “waiver” for the 16.5′ extra height shouldn’t even be under consideration. For now, I’m siding with whomever it was that opined “We hate this. It is all wrong.”
yes it will he the cayonization of Santa Barbara. only so much space between mountains and sea and forced development only way is up!
To me this seems ideal. It doesn’t block anyone’s view of the water, it doesn’t displace any existing residents, it doesn’t develop any agricultural land, and the existing development isn’t going to be commercially viable after Macy’s moves out.
If this project isn’t acceptable I find it hard to imagine what would be.
What does being a longtime Santa Barbaran entitle you to over other people? You own property and don’t want other people encroaching on your lifestyle?
Well, I’ll ask you this “localSBtown”, do YOU want to live in LA?
This won’t go well in the long run. More cars, more traffic, more more more. The concept of affordable housing is lost on a lot of people. It ain’t going to work. The developers, on the other hand, will be running straight to the bank. And then they’ll toast themselves on their porch with a few drinks where they live, which isn’t here.
44% of SB workers currently commute from out of town. That’s where the real traffic problems are coming from.
This was a very comprehensive review and informational. Maybe this could be turned into a Walmart or a Dicks Sporting goods. Even better would just be to leave it as an empty parking lot for RVs and space for another flea market. I’m not sure why anyone would want to build more housing. I never hear the retirees and SB lifers complain about the struggle of affordable and suitable housing. The housing shortage must just be more fake news.
Are you serious?! I retired from the County and never made close to the “very low income” which is 50% of the area median income!
Sure — tell me and all my compatriots to get higher paying jobs. Then who is going to man your service counters, run your local services, run your medical clinics, your non-profits? Care for your home, your yard, your pets, and most crucially — YOUR ELDERS?
Yes, I knew I’d never be homeless because I had family in SB, thus I could work for non-profits.
I recall playing on the dusty empty lot of La Cumbre Plaza around 1967. But I don’t remember the dairy. I support this housing plan. Nobody who doesn’t work 8 – 5 has gone shopping during normal hours for years or decades around here anyway!
I mean, no one who is retired or works off hours goes to the store when people who work 8-5 would be expected to. Traffic on upper State is horrible, even worse in holiday season, so I and many others just avoid it. It’s been that way for many many years. That’s why grocery stores are open late, good thing.
Amy Reinholds: THANK YOU VERY MUCH
Great write up, Amy! Thank you. Now about the parking… how many spaces? It’s not that people aren’t going to have cars, they’re just going to park them in the surrounding neighborhoods. It just spreads the blight.
I see three entrances to underground parking structures on the diagram, so there’s definitely going to be more than is visible on the surface.
Am I correct that the 16.5′ height limit increase is from the present lowest parking lot level or is it from the upper parking lot level? If it is from the lower level it is hardly an exception to the real height impact.
It appears not. It states that the 5-6 story buildings will be in the middle of the development. That would make Macy’s at the second floor grade the same as Chipotle and the upper parking for the height requirement.
If so I would offer that the height limit increase is a lot more than 16.5′. Seems like we are being gamed again.
What we need is a comprehensive study on how many “low income” workers a City like Santa Barbara NEEDS. Until then all this posturing and conjecture about the “housing crisis” is worthless. Santa Barbara is a college town and one of the most desirable areas in CA. If you built it, they will come. if housing is truly affordable (cheap) students will immediately fill them each year and then stay forever. Just because demand far exceeds supply and everyone knows young or “poor” people looking for housing does not necessarily constitute a housing crisis. I have no doubt that there is not enough truly affordable housing in SB to maximize the economic potential, and the City would be wise to find where the sweet spot is. Until then, no one has any idea what we need and what would be good for Santa Barbara as a whole in terms of development. City Council members love to put “housing units added” to their name for political reasons, but there is no deeper understanding. The bottom line is that not everyone who wants to live here will be able to. If you don’t fight to increase your wages every year and are not in a position to qualify to rent an apartment at market rate, you’ll probably never be able to and you’ll have to leave when your below market apartment comes up for development. It’s a tough reality that we all face, but property OWNERS have the power and renters are forever screwed until they can break out of the system. I firmly include myself in that boat, but since I am not a trust fund beneficiary, I chose a career that may have the potential to support a life here, otherwise I would have left years ago.
Excellent thought… I’ve lived here almost 50 years now….I have watched the development which seems quite random in general….having lived in Goleta, Santa Barbara and Noleta….being a property owner and a landlord besides.
We have a harsh reality …..few of us ultimately will be able to live here in the future….the rest will have to commute unless you’re a trust baby and keep your property in the family to avoid escalating property taxes(thank God & my thoughtful prop 13 supporters from the 70’s) This is a special place and few will qualify for a place to dwell here is the final reality we all must face. 😞
Great information, Amy! Thank you
I always feel compelled to ask the same question about these projects, : Why do the developers always just go for the minimum affordable housing ratio? The State says “you must have at least 10% affordable housing to qualify for a density bonus”, and it’s slightly more complex than that, I know, but why don’t developers say “cool but we’re gonna have 75% affordable housing” ? Why only go for the minimum? Because money, of course. And just once I’d like to see a developer turn that ratio upside down and FIGURE OUT how to make it profitable. Just once. Alas, not this time.