By Kevin Harris
In a split vote, the Thousand Oaks City Council approved another large apartment complex, this one as part of the city’s downtown revitalization plan, during Tuesday night’s meeting. Controversial in its height, the Rick Caruso project will stand six stories tall, and will be the tallest residential structure in the city (only the Civic Arts Plaza is taller).
Item 8A – Public Hearing
The business at hand was a zoning change at “The Lakes” from Commercial to Mixed use (Commercial/Residential) to facilitate construction of a new, 165-unit apartment building, though the city council was actually asked to sort through a huge, complicated development agreement of more than 1,300 pages, with very little time to do so. This materialized into a mammoth, nearly 6-hour city council meeting.
The proposed apartment building, to be erected at 2200 E. Thousand Oaks Blvd., otherwise known as “The Lakes,” would go up at the South end up the large parking lot behind the restaurants and shops.
Some of the intricacies of the proposed deal, which will be further explained and debated in this article, are as follows:
- Developer Rick Caruso will pay the city Community Benefit Payments totaling $13 million, spread out over 35 years (if the council approves his project).
- The city will sell Caruso the land (with stipulations) for the project for $2 million – far below fair market value.
- The Lakes lease to Caruso has been a bust for both the developer and for the city up to now. Because of how the initial deal was structured, Caruso never had to pay Thousand Oaks any rent because his venture there was never profitable. So approving the new project also allows the city to restructure a better deal with the developer.
Some of the stipulations as part of the land sale to Caruso include the koi pond section remaining city owned, while Caruso pays to maintain it. Additionally, the city continues to be able to advertise on the land.
City Council Questions/Comments:
Council Member Al Adam: He first pointed out that the city has not been getting any revenue from The Lakes, and that the city would stand to gain considerably in sales tax revenue alone if the project goes through.
Council Member Ed Jones: Asked at length about the increased traffic on Thousand Oaks Boulevard and Willow Lane that may appear due to the new project. According to the Deputy Director of Public Works, Nader Haydari, the project will only add 4 and 6-8 percent of cars to the roads of concern, respectively, and that those roads can handle the extra load.
Council Member Jones repeatedly asked Haydari if he had any concerns whatsoever about increasing traffic from the project, and Haydari indicated he did not. “The amount of additional traffic that this project will generate is less than significant compared to the existing 20 thousand cars per day on Thousand Oaks Boulevard,” Haydari said. Laughs could be heard in response by the many resident speakers waiting out in the hallway to Haydari’s response, to which the Mayor quipped, “quite please, quite please.”
Jones also suggested that the 101 on/off ramp to Hampshire Road would need improvements due to the extra traffic from the Lakes Apartments, and Haydari said that the city has already requested funding for that with the state.
Mayor Pro Tem Bob Engler: Engler asked the staff how the city arrived at the low purchase price figure of $2 million for “prime property on the boulevard,” that T.O. Lakes, LLC, ended up paying for the property lot. Staff explained that the original agreement stipulates that the applicant can purchase the property for either $2 million, or pay “fair market value” for it, whichever is higher. That agreement defines fair market value as “vacant, unimproved land limited to the uses that are on the property.” Staff went on to say that the uses of the property were limited to retail and restaurant use, which “significantly reduces the value of the property.” Appraisals were done, and staff is recommending that the property be sold for $2 million.
Mayor Claudia Bill-de la Pena: First commented about her displeasure about having a 1300-page, complex development agreement dropped in the city council’s lap on Thanksgiving Eve, while there were local wildfires and power outages taking place. Residents on hand applauded her comments, to which the mayor asked them not to react.
She then asked why the parcel of land dropped in value from the time it was initially purchased by the city through Eminent Domain (from Jungle Land). With a value then of almost $7 million, Mayor de la Pena asked the staff why its value dropped to just $2 million, and if there is an opportunity for a “second opinion” for an appraisal. Staff replied as before, that the terms of the ground lease determine the value of the property, and that it is not a traditional fair market value appraisal. “This is a fair market appraisal analysis that is based on the confines of what is set forth in the ground lease.”
Council Member Al Adam: “I look at this whole thing as a package, and I don’t think you can talk about the $2 million sales price without talking about the $13 million income stream. So to me, it’s a $15 million package.” He then added the other financial benefits that the project would bring, including sales tax revenues and the koi pond park maintenance.
Adam also spoke to the concerns about the height of the project. He attempted to give perspective to the 5-story structure by describing where it will be built in relation to the Lakes commercial buildings (behind them); the 109-foot tall Civic Arts Plaza, and that it will be 380 feet off of Thousand Oaks Boulevard.
Council Member Kevin McNamee: Regarding the height exception allowed for this project… “I’ve had a number of people inquire, that this would be precedent setting. And if you do 6 stories here, what’s to say we don’t do it somewhere else in the city?”
Community Development Director Kelvin Parker explained that each project stands on its own. “This particular project is differentiated from other places in the city, simply because of its proximity to the Civic Arts Plaza, the sound wall to the freeway, the distance it’s set back from the street. So it’s actually unique in that aspect. And any other project that would propose such height would have to stand on their own merit as well.”
Mayor de la Pena commented to staff that she doesn’t believe the $13 million payout with the project will be effective in assisting with low income housing if it’s spread out over 37 years (as it’s currently scheduled for). “The money is really urgent now, not 37 years from now.” She also said that with past projects they made developers place the funds in an interest bearing account. “Why wouldn’t we be able to do that with a lump sum right up front so that we can actually use it to provide and help non profit developers who specialize in affordable housing to actually develop something with a land trust or something like that,” she asked.
Finance Director Jaime Boscarino told the mayor that Thousand Oaks has a cash surplus, and can pay for low income housing expenditures now if needed, so having a long term revenue stream is of more value. The mayor disagreed.
Rick Caruso spoke via Zoom call representing T.O Lakes, LLC. The development company has helped build parts of Thousand Oaks for the past 30 years, including opening the Westlake Promenade 25 years ago, and beginning the Lakes project 16 years ago.
Regarding the Lakes, Caruso said, “I truly believe, and I know my team truly believes, that adding this residential component to the retail will create a synergy and an energy that is going to really start this growth of having a vibrant downtown.” Caruso also thanked the city for partnering with his company for 30 years, allowing him to build his company while providing entertainment and vibrancy to the city.
Mayor de la Pena then asked Chris Robertson, a Vice President with Caruso’s development firm, who was in attendance, why the building would not be all-electric, as other new construction within the city would be. “It’s in nobody’s interest to build an all electric building that we have difficulty leasing out. We need to make sure that we lease these units and that the project is successful,” Robertson said. She added that they did add a majority of green elements to the building, such as EV chargers, solar panels and battery storage. “We’ve gone above and beyond what the code has required,” she said.
Mayor de la Pena also wanted to know why the applicant chose not to include affordable housing units in the building. When Ms. Robertson said that their project was not large enough to be granted a 10 percent density bonus, the mayor responded by saying that other developers have offered affordable housing units without taking the density bonus.
Ms. Robertson shot back with facts of the agreement. “To be fair, I don’t think those projects are proposing $80 thousand in community benefits per unit. As we engaged in conversations with the city, it became clear that they wanted an ongoing revenue stream, and the ability to use their discretion to funnel those monies into whatever priority the city had at the time,” she said.
Council Member Adam asked if the applicant would be willing to start the long term payments to the city in two years instead of the 4 years as scheduled. Robertson said that would have to be a team decision and she would get back to the council on it. Adam then included the mayor in the discussion, who dismissed the issue as less relevant than the spreading out of the Community Benefit Payments over 37 years. She again stressed that she would prefer the funds up front, even with a lower amount.
During this back and forth, Mayor de la Pena also asked Ms. Robertson what the rent amounts will be at the proposed apartment building, stressing the community’s need for workforce housing, but that information was not yet established or available.
About 50 people registered to speak on the issue of the proposed apartment building. Some were present in person, while others called in via Zoom, and each was given 2 minutes to speak. Following is a sampling of speakers representing both sides as accurately as possible.
Diane McKay: Long time Thousand Oaks resident. “Somewhere along the way we became a city of NO, and I can’t really figure out when that started. The threat of us becoming the San Fernando Valley is just kind of tired. This city is well planned… It’s never going to become the San Fernando Valley.” She also said we need housing of any kind and that the project “just makes sense.”
Amy Commons: 40-year community resident, representing Los Roblos Health System. Explained some of the changes Los Roblos Hospital has made to keep up with the changing demands of the community, such as adding a new tower to the hospital and becoming a “teaching hospital” to keep up with staff requirements. She said expanded workforce housing is a top priority for her. “We’re so fortunate to have to have a developer such as Caruso. One that has such vested interests. We’ve seen the body of his work.”
Daryl Lafferty: Lives in mobile home across from proposed project site. Said Thousand Oaks has successfully protected itself from high rise building for decades. “Why would we now want to open the door to such extreme heights being proposed here at The Lakes?” He said the average height allowed has typically been about 35 feet or 3 stories, and that we’re now being asked to double that. He asked the council to stay within established General Plan boundaries and work the current deal to restrict the building to 4 stories tall.
Vince Vlassic: Thousand Oaks resident, 43 years. “My concern is that this project has been put on a fast track.” While he acknowledges the value of bringing much needed and mandated housing units to the city, Mr. Vlassic is concerned about the lack of affordable housing units with the project and with the height exception granted to the developer.
Diana Merval: Thousand Oaks resident, 22 years. Brought a gift for the city council – a children’s book called “The Little House.” Merval explained, “It’s about a house that grows up in the country, and the city grows around it.” She asked the council members to pass it around among themselves “before you go on to make these General Plan changes of height restrictions and things like that.” She also commented that the proposed apartments seem like luxury apartments as opposed to middle class apartments and will be unaffordable for most residents.
Mariane Van Zile: Thousand Oaks resident. Said she is in favor of building on the Lakes parking lot and says it can support a six-story building, but that she’s disappointed it won’t include affordable housing units. Wants the council to vote in favor of the project, even with its failings.
Tom Cohen: Thousand Oaks resident, 60 years. Said that the Boulevard and the Lakes have languished for years, and that this project is the first opportunity to do that, and to “create a walkable village.” He said Caruso’s commitment to quality is real, and that the height of the building will not block existing views. He urged the council to support the plan.
Gary Raymond: Thousand Oaks resident, 40 years. Opined that Caruso does not need a new apartment building onsite to make The Lakes profitable. He said there are already several apartment buildings within walking distance of The Lakes, and that maybe the problem are high rent prices he is charging his commercial tenants.
He also doesn’t want to see the 4-story apartment height limit changed.
Dave Gulbrandsen: Westlake Village resident, 50 years, 45 year business owner in Thousand Oaks. “You can’t take the most expensive property in Thousand Oaks (Thousand Oaks Boulevard), and put affordable housing on it. It makes no sense at all.” He explained how he lost two major local property deals because the city council wanted to downsize his deals and force affordable housing onto them. Wants a sensible, “blue ribbon panel” put together to come up with solutions for affordable housing in the community. Supports the Caruso project.
Steve Casted: Resident and local property owner. Said he’s enjoyed going to The Lakes with his family, but has seen The Lakes fail over time. He said that will all change with the Caruso development. He also said that affordable housing is an important issue, “but why penalize Caruso?,” Casted asked. He said Caruso’s development will be “the jewel of the boulevard.”
Faith Grant: Westlake Village resident. Concerned mostly with the environmental features promised to be included in the proposed building. She said that these features were verbally promised during a November 11, 2021 meeting between Caruso’s representatives and the Conejo Climate Coalition, but were never guaranteed in writing, and that the big, complex deal needs more time for review.
Finance Director Jaime Boscarino said that during the public comments she consulted with Caruso’s team, and they agreed to Council Member Adam’s request to begin the Community Benefits Fee schedule in two years rather than in four years. She also answered a question brought up by a public speaker about what happens to that extended payment if Caruso’s company goes “belly up” or the building is sold to another company. According to Boscarino, in either situation, that payment schedule requirement would transfer to the new building owner.
Council Member Al Adam: “This trailing income stream is an ‘in leu’ fee. In leu of affordable housing,” he said, speaking to the mayor’s serious concerns about the project’s lack of included affordable housing units. He went on to talk about the broader implications of the project by reminding the council that they had created the city’s first new General Plan update in 50 years.
“And we all agreed on the strategies – the key strategies with this General Plan update. It’s amazing how many of those strategies match this project tonight. A diversity of housing types, protecting single family neighborhoods from development, creating a meeting and gathering space fostering it here in downtown Thousand Oaks, revitalizing under utilized land. All these things we agreed on, and this project accomplishes these things,” Adam said. He proposed that this project is a “test about how serious we are about creating a downtown.”
He also said that opportunity knocks once, and this is an opportunity to get out from underneath an unfavorable deal (the unprofitable Lakes deal). Additionally, Adam pointed out that this deal won’t use one single acre of open space or from a residential neighborhood.
Council Member Ed Jones: “I am not opposed to apartments, but I would like to see affordable units. Rather than see a high rise of market rate apartments, I’d rather see a lower building of more affordable units,” Jones said. He also explained that he thinks a land use project should stand on its own, separate from any investment concerns.
His main concern, however, is precedent, relating to allowing such a tall building to be constructed. “I’m not a dramatic person. I’ve sat here for 5 and a half hours, and I’ve tried to be open minded about everything I’ve heard. But I believe the day this project goes forward is the day we will begin to abandon our rustic, lovely, semi-rural community, and start down a road toward urbanization. And I’m afraid of it,” Jones concluded.
Mayor Claudia Bill-de la Pena: She spoke very highly about Caruso’s projects and what they add to communities. However, “when I say we need workforce housing, I mean that. And we have demanded that of every developer that has come before the council with a pre-screening. And I find it extremely tough to approve a project nowadays, that doesn’t provide enough workforce housing,” the mayor said. She also pointed to the rushed nature of the vote, and said there wasn’t enough time to renegotiate any of the elements.
“This is a major, major development agreement that needed more scrutiny… It’s regrettable that tonight it’s ‘take it or leave it,” the mayor said. She said she can not support the project and that just like in 2004, it will end up being a 3-2 vote.
The ordinance passed on a 3-2 vote, with Council Members Adam, McNamee and Mayor Pro Team Engler in support, and Council Member Jones and Mayor Claudia Bill-de la Pena opposing.
The next Thousand Oaks City Council meeting will be on Tuesday, December 7, 2021, at 6:00 PM. The URL to watch the meetings back and to download a meeting agenda is https://toaks.primegov.com/public/portal.
Kevin Harris is a reporter, editor and journalist, previous President of Cal State Northridge’s Society of Professional Journalists, and having worked for the LA Times and Newhall Signal. He is now also an author and videographer, and lives with his two children in Thousand Oaks.