Guest Opinion: How We Can Make the Agrihood Project at the BAREC Site Better

By Kirk Vartan

In October 2018, we learned about financial opportunities for the former BAREC site that sound really good for the City, but there was no in-depth discussion. I thought we were going to hear more about the reasons behind the decisions being made, why some land was ground leased, why there isn’t more retail, etc.

For example, why is the market-rate rental building being built on land that is “sold” and not a “ground lease” like the affordable building and the open space? My understanding is the developer Core is going to purchase the land under the market-rate apartment building and the townhomes for approximately $15 million, which the City will immediately loan back to Core to help pay for the affordable building. Couldn’t that money be directly invested into the affordable building by Core? The ground lease would pay the City monthly, similar to City Place, Levi’s Stadium, etc.

Another question: Tax credits and $23.5 million in project vouchers the developer is receiving from the County are great funding mechanisms for the developer, but could there be a mechanism in the ground lease of the land that recoups future “windfall profits” of the entire project to be shared with the City for this project site, similar to “performance rent” in a structured commercial lease? This would protect the future interests of the City and allow unforeseen profits to be invested into this project and the community.

I heard the Council ask for additional ground floor activation to create opportunities to evolve the site and give reasons for visitors to stay and explore (e.g., cafés, neighborhood shops, wellness center, education centers, studios, non-profit spaces, live/work spaces, etc.). How has this request for additional retail been addressed in the project? Could the City Council direct the City Manager and the negotiation team that they’d like to see additional retail and activation spaces? In the scoping meeting, staff spoke about 25,000 square feet of commercial space, but the project now proposes only 2,500 square feet. Could we compromise on requiring Core to provide 20,000 square feet of commercial/retail space? I was specifically told by City Staff additional retail could be added without any delays.

If there are any “soft or hard costs” to adding retail, Santa Clara could provide some “good faith” financial support and use some of the Valley Fair’s current parking rental income (over $250,000) and overall project savings to invest in public spaces or retail spaces. Or perhaps, if all the land except the townhomes is ground leased rather than sold, the City could lower Core’s rental rate to cover the additional expense of increasing the retail that the Council has asked (e.g., a “rent reset”). The City could even use some of the original budgeted resources to subsidize some of the retail spaces, making them more affordable and attainable to mom-and-pop shops. There are many other terms the City could investigate to incentivize Core to build the desired vibrant public space.

Decisions will be made soon on the entitlements, DDA, zoning, general plan, project approval, etc. for the site.

We need to keep in mind that because of its unique location and unique approach among other factors, the Agrihood will be studied and discussed for decades, whether it was meant to be a Signature Project or not.

When Mayor Lisa Gillmor talks about making the public spaces the “anchor tenant of a development,” that is exactly what we are talking about. We have a great start here, but retail needs to be pushed further. Lean into the idea of an activated ground floor. Require a minimum of 20,000 square feet of commercial space at the Agrihood.

Don’t wait until the January approval meeting to learn it is not there. Ask for it now.

**This column was re-written by the author, for this site, based on comments he originally made at City Council. **


  1. […] Council takes action on the “Agrihood Project” with Core Affordable Housing for the development of up to 361 multi-family residential units and 1.5 acres of open space at 1834 Worthington Circle/90 North Winchester, the former BAREC site. We recently published a guest opinion by local businessman and community leader Kirk Vartan about the project and its need f…. […]

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