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01 Industrial Business 10300 Torre Avenue Cupertino, CA 95014 (408) 777-3308 FAX (408) 777-3333 Community Development Department CITY OF CUPEIQ1NO SUMMARY AGENDA NO.~ AGENDA DATE: April 4, 2006 Application Summary: Conduct a study session regarding industrial business in Cupertino Recommendation: Discuss the issue of conversion of industrial businesses to residential or other non- commercial uses and provide direction for future action. BACKGROUND: The City Council scheduled a study session on March 7, 2006 to consider retaining certain areas in industrial use and eliminating the potential for residential uses. Several recent projects have proposed the conversion of office/ industrial uses to residential uses. As shown on the enclosed General Plan land use map, all of the office, commercial and industrial land use designations allow residential use. (However, Policy 2-35 states that residential uses are not allowed at the Hewlett Packard campus in the North Valley area.) A General Plan amendment would be required if residential uses were eliminated from any of these areas. On the March 7, 2006 study session the council decided to discuss this issue over a series of study sessions. The council wanted to study the following: >- Preserving campus opportunities within the city >- Creating definitive boundaries between revenue generating and non-revenue generating uses >- Removing the residential overlay from some of the properties while preserving it on others >- A historical comparison of the top 100 sales tax generators within the city >- An analysis of the types of businesses that have been top sales tax generators in the past and the magnitude of sales tax that they generate. >- Eventually, assigning a risk to each of the businesses >- Analyzing whether the housing element will be affected by removal of the residential overlay DISCUSSION: Staff has identified edge properties several properties in and around each of the four- industrial/ office use areas, North Valko Park, South Valko Park, N. De Anza Boulevard and the Bubb Road Special Centers. These edge properties have been /- / Printed on Recycled Paper Page 2 of 3 April 4, 2006 identified based on the criteria of the new General Plan policy on maintaining cohesive commercial centers and office parks (enclosed). According to this policy, any future conversions will need to blend with the surrounding area and not be a residential island. Conversely, staff believes that retaining the residential overlay on these properties will help create cohesive residential neighborhoods and build community and prevent these parcels from being industrial islands among primarily residential uses. Therefore, staff suggests that the residential overlay be retained on these parcels that are on the edge of the office, commercial and industrial land use designations and abut residential uses. These properties are not cohesively part of any commercial centers. Attached are four maps that show these edge properties and the location of each with respect to the central cohesive core of the areas for industrial use. Each of the properties highlighted could be considered edge properties and eventual conversion of these properties to residential use will draw clearer boundaries between revenue generating and non-revenue generating uses. Removal of these industrial, office buildings would remove a total of approximately 1.12 million sq. ft. of the citywide total of approx. 8.33 million sq. ft. of officej industrial sq. ft. This constitutes 13.43% of the total officejindustrial square footage in the city. This can be viewed as trimming the functionally obsolete edges of the industrial areas and maintaining the continuity of the residential areas. It should be noted that these properties have not been among the top 100 sales tax generators. The following is a table that shows the square footage of these edge properties and the associated maximum densities using the number of units available in the General Plan should they be converted to residential use. Square Footage Maximum Maximum Square Units Density based Footage as % of City- Acreage Available on Units Density per wide Total A vaila b Ie General Plan North VaIIco 299,513 3.6% 21.63 170 7.86 25 South ValIco 299,078 3.59% 17.53 0 0 35 N De Anza 192,503 2.31% 14.56 100 6.87 25 Bubb Rd 328,187 3.94% 19.64 94 4.79 20 Totals 1,119,281 13.43% 73.36 The council also wanted to know whether the housing element of the General Plan is dependent on the residential overlay and if this were to be removed if the housing element would be adversely affected. The housing element will not be affected by such a change since there is sufficient inventory of adequate sites to accommodate the units that are in the General Plan. In addition, the Planning Commission discussed its 2006 work program at its March 28, 2006 meeting, which includes a study of obsolete Research and Development properties city-wide to determine appropriate long-term use. The City Council requested that this study be merged with the Council's discussion of industrial conversion issues. The Planning Commission expressed concern over potential piecemeal development in the -2- 1- 2- Page 3 of 3 April 4, 2006 North Valko area, should more applications be submitted for conversion of industrial uses to residential uses. Therefore, the Planning Commission recommends that the City Council authorize the preparation of a master plan for the North Valko area (see enclosed Minute Order). The City Council has seen the Planning Commission's 2006 work program which includes the desire to conduct an inventory of the functionally obsolete buildings in the city and determine, if residential uses do not seem appropriate on these properties, alternative uses that might be available and desirable, such as public or quasi-public uses. The council should incorporate this item into this study. Enclosures: General Plan Land Use Map General Plan Policy - Maintaining Cohesive Commercial Centers and Office Parks Top 100 Sales Tax Generators Exhibit A - Valko North Residential Overlay - Edge Properties Exhibit B - Valko South Residential Overlay - Edge Properties Exhibit C - N De Anza Residential Overlay - Edge Properties Exhibit D - Bubb Road Residential Overlay - Edge Properties Minute Order - North Valko Area Master Plan Prepared by: Piu Ghosh, Assistant Planner Subm'tted b l ~~ Approved by: . -~ David W. Knapp City Manager Ste e Piasecki Director of Community Development G:planning/ pdreport/ cc/2oo6/ industrial business study session2 - 3- /-3 ~,.._~ ~. CihjofCupcrt;,w ..~ Land Use Map ~-~~Ë':'~::''''''"'' _sp....oIlnn......'" ~~::~ IMuI U.. o..ign.Iiø;:_ F..~.~) R¡ .....~.~:::::~I~A~:::_.~...¡ B~~:o...~,,,:~~"""''') D.....""""',:-;:;c..""'..'......m~'" D....."..~,'- ~""u¡<;,-.A..I 0'-1.....··..'::;.',,""'''"1'''......, IE!I-;;;:;':~""U/"'.A<.J _..;v. "u..dU..o..;gn.liø... N:i~::~"",,,,7"'"""" -""""-...,'"'""".;'.::."""...1.......'.. DOII..,...·~~_~I EJ:::::::.,....._/C_~.. ......;:.;:-;-""...-.-- = ~...~.·I ""...___O.~~, .........."....'.-.. B""_c;,.- on:g=I..>RdlJ"Dü;~"I<I" M «1-4.'00/",.'<.) O"'::::'U"DU/c..",-" B~~"",,,,;::;:"~:,":.;~;."....... rÌì O"~.I..... I.ðJ c"'"'Y"".elcr~~~ r.....'.'lbr... M"I".,H' GIS /-'-/ Centers and Office Parks Cohesive corrunercial centers and office parks are necessary to maintain a healthy sales tax base for the city and to retain opportunities for existing businesses to expand in response to changing business trends. Cupertino's major retail corrunercial centers are located at Valko Fashion Park, The Marketplace and Portal Plaza centers, Cupertino Village, the Oaks and the Crossroads Corrunercial District; the office parks are located at Valko (North of Highway 280), North De Anza Boulevard and Bubb Road: Cohesive Commercial Maintainin Projects with residential or quasi-public components proposed to replace some or all of the existing industrial, office and commercial uses on a site in these areas will be evaluated on a case by case basis to determine if they are complementary to the overall business park or shopping center, or otherwise meet the following criteria: Integrate into the existing land use pattern by: · Continuing established land use patterns (e.g. corrunercial next to commercial or residential adjacent to residential) · Continuing patterns of building massing, setbacks and height · Establishing logical development patterns bounded by visible natural or man-made features such as a public or private road, creek, freeways etc. Provide visible pedestrian/bicycle connections to and from existing uses. Provide a visible and publicly accessible park/plaza or open space area. Orient active building spaces to the public or private rights of way. Provide superior building design with high quality natural materials and building architecture. Demonstrate there are sufficient existing or supplemental local revenues to support municipal and school services 1) 2) 3) 4) 5) 6) needed to serve the development. Show that the building is functionally obsolete in a market sense and cannot be reasonably redeveloped or marketed into a compatible use within the surrounding area, or show the existing building/use is no longer complementary to 7) the larger corrunercial center or office park Show that the development can reasonably stand alone as a self-sufficient land use that is otherwise complementary to existing buildings and uses. Show that the residential or quasi-public use provides an incentive to corrunercial or offices uses on the site. incorporate a significant component of 8) 9) Two-thirds of the commercial/office square footage that is converted to residential uses shall be allocated to major employers (companies with Cupertino sales offices or corporate headquarters). The remainder of the square footage shall be allocated to the commercial or office pool in the subject area. - I lJ\ »œ ~. c..«ed; .......12. o .., 0,25 . Top 100 Sales Tax Generators HømNlem Rd -- I E>- VALLCO NORTH RESIDENTIAL OVERLAY EDGE PROPERTIES Prepared by the Community Development Department Created On: March 28, 2005 N "'~Mi!es ^ 0 0.0250.05 0.1 ¿XHIßIT k 1-1 Prepared by the Community Development Department Created On: March 28, 2005 N "'~Miles J14. 0 0.05 0.1 0.2 hH\ßIT e, 1-3 N. DE ANZA RESIDENTIAL OVERLAY - EDGE PROPERTIES Prepared by the Community Development Department Created On: March 28, 2005 N "'~Miles ^ 0 0.025 0.05 0.1 £)(I-t I ¡:,-r ó- 1- cr BUBB ROAD RESIDENTIAL OVERLAY - EDGE PROPERTIES Prepared by the Community Development Department Created On: March 28, 2005 N  ~Miles o 0.0250.05 0.1 eXHIBIT j) J _10 CITY OF CUPERTINO 10300 Torre Avenue Cupertino, California 95014 RESOLUTION NO. 6382 (MINUTE ORDER) OP THE PLANNING COMMISSION OF THE CITY OP CUPERTINO RECOMMENDING THAT THE COUNCIL AUTHORIZE THE PREP ARA TION OF A MASTER PLAN FOR THE NORTH V ALLCO AREA PROTECT DESCRIPTION Application No.: Applicant: Location: U-2005-15, TM-2005-05, Z-2005-04, EXC-2005-18, EA-2005-07 Mike Rohde (Valko Fashion Park) North of Stevens Creek Boulevard and South of 1-280 between Tantau Avenue and Pinch Avenue. The Planning Conunission discussed its 2006 work program at its March 28, 2006 meeting, which includes a study of obsolete Research and Development properties city- wide to determine appropriate long term use. The City Council requested that this study be merged with the Council's discussion of industrial conversion issues. The Planning Commission expressed concern over potential piecemeal development in the North Valko area, should more applications be submitted for conversion of industrial uses to residential uses. Therefore, the Planning Commission recommends that the City Council authorize the preparation of a master plan for the North Valko area. PASSED AND ADOPTED this 28th day of March 2006 at a Regular Meeting of the Planning Commission of the City of Cupertino, State of California, by the following roll call vote: AYES: COMMISSIONERS: Chairperson Miller, Vice-Chair Giefer, Saadati Wong; Chien COMMISSIONERS: none COMMISSIONERS: none COMMISSIONERS: none NOES: ABSTAIN: ABSENT: ATTEST: APPROVED: Steve Piasecki Director of Community Development Marty Miller, Chairperson Planning Commission I-II BIT Company Sales Tax Property Tax Apple Computer X X m Hewlett Packard X X Target X >< Sears X JC Penney X ::c Chevron Service Stations X Macy's X Mervyn's X Union 76 Service Stations X m Shane Diamond Jewelers X Whole Foods X ~~"'1 Longs Drug Store X I TJ Maxx X Œ_ j DeAnza College Campus Center X Rotten Robbie Service Stations X Valero Service Stations X .::;.c./ q -~ -O{c Shell Service Stations X -if/ BJ's Bar & Grill X IBM Rational Software X 5f~'dl 5t'5":>101\ Cupertino Clean Scene X Incl:h"'¡ncll Suburban House X ßu'·"nf'S5 DeAnza & Cupertino US Gas X Dental Arts of California X Tadpole Technology X Symantec X X Joy Luck Place X TGl Friday's X Elephant Bar Restaurant X Marina Food X Dynasty Chinese Seafood X Benihana's X Outback Steakhouse X Cypress Hotel & Helios Restaurant X Michael's Arts & Crafts X Vallco International Shopping X Sodexho Marriott Management X Jade Galore X Verizon Wireless X Cupertino City Center X Todai Restaurant X Company Sales Tax Rite Aid Drug Stores Welcome Market JoAnn Fabrics Cupertino Smog Pros PW Supermarket Chili's Bar & Grill Cupertino Supply Summerwinds Garden Centers Yamagami's Nursery Villa Serra Apartments RWC LLC Walgreen's Drug Store Fontana's Durect Corporation Irvine Apartment Commons Ridgeview Court Associates Albertson's Food Centers Argonaut Window & Door Fedex Kinko's Alexander's Steakhouse Fresh Choice Restaurant McDonald's Mobil Service Stations Century Furniture New Things West United Furniture Club Mandarin Gourmet Miyake Restaurant 408 Motors Menage Automation Chipotle Mexican Grill Canton Delights Restaurant Ritz Cameras Armadillo Willy's Marie Calendar's Pier One Imports Shaw's Saddlery Baja Fresh Mexican Grill Aidas University Book Exchange Victoria's Secret x X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X Property Tax X X X X Company Cbiz Technologies Footwear Etc. Vardy's Jewelers Duke of Edinburgh Restaurant Jack in the Box Hobee's Restaurant Petco Animal Supplies Pizza Hut Azuma Japanese Cuisine Express Diddams Goodyear Tires Hong Fu GOUTITIet Chinese Restaurant Blockbuster Entertainment Aaron Brothers Art Mart World of Music P ackateer Sales Tax x X X X X X X X X X X X X X X X X Property Tax