Pre-App - 2012Community Development Department
Planning Division
To: Chair Alster and Planning Commissioners Date: June 26, 2012
From: Steve Prosser, Associate Planner
Via: Paul K~ermoyan, Interim Community Development Director
Subject: Pre-Application Study Session ~ 1875 S. Bascom Avenue
PURPOSE
The purpose of this study session is to present a conceptual subdivision proposal of property
located at 1875 S. Bascom Avenue (also known as the Pruneyard Shopping Center). A
preliminary application ("pre-application") provides an opportunity for the Planning
Commission to provide feedback during the early stages of the planning process in order to
facilitate preparation of a formal application.
A pre-application for this project is required pursuant to Campbell Municipal Code (CMC)
Chapter 21.41 requiring submittal of apre-application and study session review by the Planning
Commission for projects involving two or more acres or a change in zoning. Since the pre-
application process does not constitute a formal application review, comments are considered
advisory recommendations for the use of the applicant. Comments are not binding upon the
Planning Commission as to any determination made on a formal application. In that regard,
staff's review of the preliminary project plans is limited to the overall project design concept and
is not considered a substitute for formal project review.
BACKGROUNI)
SITE CHARACTERISTICS
The project site, the Pruneyard Shopping Center, is 27.2 acres located on the west side of
Bascom Avenue, between Campisi Way and East Campbell Avenue (reference Attachment 1,
Location Map). The property is surrounded by mixed use commercial/residential uses on the
north and commercial uses to the east and south and the Los Gatos Creek and Hwy 17 to the
west. The Zoning Map (reference Attachment 2) classifies the project site as C-2 (General
Commercial) for the portion of property developed with commercial uses and the existing hotel,
and C-2/O (General Commercial/Overlay) for the multiple story office and parking structures.
HISTORY
The existing development was originally granted through a Site and Architectural Approval
(equivalent of the current Site and Architectural Review Permit) in 1968 (S68-65) consisting of a
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Master Plan to df;velop the Pruneyard Commercial Complex to be constructed in six phases. In
1969 a Site and Architectural Approval (569-43) was granted for phase one of the center. The
remaining five phases were approved through Site and Architectural Approvals in 1970.
Construction of the office towers commenced in 1971 through the approval of a development
agreement and zoning overlay allowing for increased building height. The hotel component was
constructed in 1989. In 1994, in conjunction with an exterior remodel of the commercial
shopping center, reconfiguration of parking, and hotel expansion, the property owner requested
City approval for alcohol sales and outdoor dining for existing and future restaurant uses. As
such, a master Conditional Use Permit (UP94-19) was granted to allow alcohol sales and outdoor
seating but limited the number of restaurant uses on site to ensure a successful balance between
hotel, restaurant, office, and retail that could thrive in spite of an overall parking deficiency.
SUBDIVISON OF SHOPPING CENTER
The issue of subdividing the Pruneyard Shopping Center has been discussed between the City
and each successiive owner of the Shopping Center since the 1970's as each owner, including the
current, was under the impression that the center consisted of four legal parcels. Once each of the
property owners understood that only one legal lot existed, a request to subdivide the center
would be initiated. Review of previous planning files show that there have been various reasons
why City staff has expressed concern with subdividing the Pruneyard parcel. One concern
pertained to preserving a large general commercial parcel for future development opportunities.
Another concern addressed a belief that multiple land owners would disrupt a shopping center
with shared amenities and design characteristics. The center was originally developed with
common access, common utilities, and shared parking that irrevocably ties the center together.
By creating independent ownerships, control of the center could be diluted to a point where
uniform maintenance, on-site improvements and future development may be problematic or
difficult to control.
DISCUSSION
The preliminary subdivision plan would create two new lots out of one legal lot with Parcel A
consisting of the multiple story office buildings and parking structures. Parcel B would include
the remaining rel:ail and hotel structures. In addition to the lot split, the applicant is requesting
approval to create separate "air space" condominium units for Parcel B. One condominium unit
would consist solely of the hotel structure and the other would incorporate the remaining
portions of Parcel B (reference Attachment 3, Project Plans). The applicant is requesting the
creation of condominium units within Parcel B to allow the transfer of interest of the hotel
portion to a separate owner that has expertise in hotel operations. The applicant also believes that
the separation of the office and parking structures from the commercial and hotel uses would
allow individual ownership by experts in each of the three use categories, ensuring successful
continued operations (reference Attachment 4, Applicant Project Narrative).
Within the City of Campbell, any development proposing condominium units (whether
residential or commercial) would only be allowable within the C-PD zone district, pursuant to
CMC Section 2,1.12.020(D). In this regard, a zone change would be required to allow
independent ownership of the hotel "air space" parcel and the retail/commercial parcel.
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The following discussion highlights issues necessary to assist the Commission's identification of
the pre-application review regarding whether or not the subdivision of the Pruneyard is
beneficial to the City with regards to the center's operation, uniform development, and local
regulatory controls.
As the question of subdividing the Pruneyard Shopping Center has been unsuccessfully broached
by past owners, and understanding the City's historical concerns, staff questions what has
changed to warrant subdivision of the property. Specifically:
• Does the center not function well?
• Are there noticeable problems with the center caused by being located on one parcel?
• Is the cenl:er not properly maintained?
• Are there difficulties coordinating between the various uses?
• Is the center (or each of the individual components) not successful?
Although the above questions pertain to perceived difficulties of operating the Pruneyard, other
questions relative; to benefits gained with a subdivision are equally important, such as:
• What will be the benefit to the existing owner?
• Will individual ownership of hotel, retail, and office uses create a more vibrant center?
Will individual ownership of the noted uses provide the City with a regulatory tool to
manage the overall center more effectively?
OBSERVATIONS
Does the center not function well and are there noticeable problems with the center caused by
being located on one parcel?
In order to evaluate these questions, staff looked at both Building and Planning Division activity
during the past few years. Staff found significant development activity including the
establishment of new tenants and the expansion and remodel of existing uses on site. This
activity is appropriate for any active commercial center that experiences a change in tenants as
the retail component reacts to the desires of the consumer while experiencing a relatively low
vacancy rate of approximately 10% for the retail uses. Staff has also observed that the center is
highly used and appears to attract many customers based on the inability to find conveniently
located parking.
Is the center not properly maintained?
Staff has visited the center multiple times and found the building exteriors and common areas
(landscaping, walkways, and parking areas) well maintained and presentable. There are no active
Code Enforcement complaints regarding site maintenance of the Pruneyard Shopping Center.
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Are there difficuh`ies coordinating between the various uses?
Due to the existing CC&R's regulating the site as a whole and also the multiple City approvals
for each of the uses, coordination has not been a problem. Recent examples are the exterior
improvements to the office towers, introduction of an office tower Master Sign Plan, and the
establishment of new retail .and restaurant uses in the commercial portion of the center.
Is the center (or each of the individual components) not successful?
Staff has not found any instance where existing conditions have negatively impacted the hotel or
office operations. With regards to the commercial component, the one significant issue that has
caused the property owner and City concern is the master Conditional Use Permit limitations
regarding the mi:x of uses allowed on site. This limitation was specifically created in 1994 to
limit the number of restaurants on site due to the shared parking provided, which was found to be
less that the total parking required for each of the uses on site. The current property owner has
expressed concernn that the existing limitation on the number of restaurants has stymied tenancy.
If a subdivision were to occur, one issue to discuss is how the success of one property owner
would impact the amenities of another. For example, all parking stalls are currently shared within
the center. If the office uses consistently maintain 100% occupancy with numerous employees,
will the demand for parking take away parking opportunities for the remaining uses? The end
result could be rriarked or color coded parking stalls dedicated for each land use. The approach
would certainly create an unharmonious relationship not currently seen under a single owner.
What will be the benefit to the existing owner and will individual ownership of hotel, retail, and
office uses create a more vibrant center?
The applicant's response to these two questions is found in the project narrative (Attachment 4).
The current property management, Equity Office, is concerned with their limited experience
managing both retail and office uses as their primary focus is office property. As a result, the
property owner entered into contract with Larkspur Hotels to manage the hotel component due to
their experience in hotel services. Equity Office believes that providing experienced hotel and
retail operators .a financial interest (i.e. ownership) would improve the overall quality and
experience of the center by enhancing tenancy through each operator's expertise.
Of course, this approach raises the question if the main property owner, Blackhawk Parent LLC.,
should simply hire a hotel management company in addition to Equity Office. Having two
management corripanies may be a simpler approach to addressing the lack of "expertise" issue as
compared to changing the zone district and subdividing the Pruneyard Shopping Center.
Will individual ownership of the noted uses provide the City with a regulatory tool to manage the
overall center more effectively?
If the property was subdivided, the adoption of a Planned Development Permit could be found
beneficial. A Planned Development Permit would allow the City to conduct a comprehensive
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analysis of the site, including operational characteristics (i.e. parking, variety and number of
uses), that is long overdue. The Planned Development Permit approval would create a single
comprehensive document consolidating over 44 years of conditions of approval. Additionally,
new conditions could be introduced to ensure uniform maintenance, site circulation, parking
accessibility, and redevelopment of each of the newly created lots.
Alternatively, if the proposed subdivision does not occur, each of the uses on site would still
operate under a variety of independent entitlements, each with its own set of conditions. One
example would be that the Master Use Permit would still be in effect until such time as the
property owner applies to modify the existing approval.
NEXT STEPS
A formal submittal for this project as presented by the applicant would require applications for a
Zone Change, Planned Development Permit, and Tentative Parcel Map.
Prepared by:
Steve Prosser, ssociate Planner
Approved by:
Paul Kerm yan, Interim Community Development Director
Attachments:
1. Location :Map
2. Zoning M:ap
3. Preliminary Project Plans
4. Applicant Project Narrative