Santa Clarita city planners are recommending the City Council on Tuesday approve some developer-requested changes to MetroWalk — plans for nearly 500 homes in Canyon Country — but not all of them.
The city is recommending the City Council give more time and flexibility to the project, but it’s not recommending the city accept about $800,000 from the developer to let it off the hook for the affordable housing component.
MetroWalk already has construction under way for the first 150 homes on the 20-acre lot at the southeast corner of Lost Canyon Road and Harriman Drive, next to Vista Canyon.
Before the developer, BluMax, can begin the next round of building, it’s required to start a 10% affordable housing component, which is what prompted the re-evaluation of its plans.
The challenges mentioned by the developer included getting financing for apartment units, as well as any available affordable-housing subsidy, which city officials acknowledged as an important part of the project.
“It is understood that financing rental apartment construction is not currently feasible and such development is not expected to return to feasibility for the foreseeable future given current economic conditions,” wrote Jonathan Frankel, vice president of New Urban West, in an October 2023 letter to the city. “Therefore, to deliver housing opportunities in a timely manner, we believe the project must be adjusted to respond to the changes in market conditions that have occurred since the (specific plan) adoption by delivering for-sale attached townhome units in lieu of rental apartments.”
John Musella, a spokesman for New Urban West, said the plan remains to provide the “price-attainable housing” in a statement from the developer Friday.
“The goal of the amendments to the MetroWalk Specific Plan are to create additional flexibility so we can continue to meet the current market demand for price-attainable housing — all while providing more time and greater opportunities to secure the needed state funding to build the senior affordable housing as part of the community,” the statement read.
In order to keep construction on the plans moving, the developer is asking the city to let it build more townhomes instead of apartments, and for the city to take some money instead of making the developer build the affordable-housing component.
The recommendation for the meeting agenda published Thursday states city staff does not have any problem with offering the developer more time to build, but staff has no study or system for what to do with an in-lieu fee at this time, which is why city planners are only recommending time and flexibility.
One of the problems: The city has no plans or precedent for what it would do with such a fee, and the proposed amount wouldn’t be anywhere close to what it would take to incentivize a developer to build 49 affordable units. The agenda for Tuesday notes the last time the city did subsidize such a project in Newhall, the developer subsidy was closer to $180,000 for each unit.
The current recommendation from the city calls on BluMax to be able to build all but 30 of its market-rate units before it has to build the 49-home affordable component.
The city acknowledged it’s possible the developer could walk away from the project before it’s built out, but city officials have stated they don’t think that’s a likely scenario.
Both Nathan Keith and Tim Burkhart, members of the Planning Commission with backgrounds in project management, mentioned during a previous discussion that the last homes are usually where the profit margin is realized in a plan like this, which makes the building condition a strong motivator.
New Urban West is looking to build more than 6,500 homes at the center of the SCV for a development in the center of the Santa Clarita Valley called Sunridge, which is currently going through the entitlement process.
