Six Things I Didn’t Know About the Proposed Housing at La Cumbre Plaza Until I Went to the Open House – edhat

The line snaked through the promenade between shops at La Cumbre Plaza on Wednesday night, Jan. 17, almost to the old Sears building, but people weren’t waiting to get into a going-out-of-business sale or an arts event. They were waiting to get into the open house for a new mixed-use development proposed for the Macy’s site and adjacent parking lot after the department store’s lease ends in 2028.

Proposed plans for “The Neighborhood at State & Hope” on the 8.7 acres owned by Jim and Matthew Taylor and MCP Santa Barbara LLC currently include 642 residential rental units, as well as shops, restaurants, and community space. The Taylors and architecture companies working on the plans hosted the open house at the Grace Fisher Foundation Inclusive Arts Clubhouse space at La Cumbre Plaza, south of the site being discussed.

During the open house, nearly 300 people signed in at the door for updates on the project, according to the open house organizers. Others didn’t sign in, but by the end of the two-hour event, there was no longer a line.

Like most housing issues, the story of this proposal isn’t as simplistic as “yes in my backyard” (YIMBY) versus “not in my backyard” (NIMBY) neighbors. And with construction not expected to start for at least four years, it’s going to be a long story.

People may have decided to show up for a variety of reasons, including to oppose or support the project, for the free food, to give their input, or to just to learn more. There will be more meetings, and plans will probably change after each one, but here’s a quick list of what I learned at the open house.

1. This proposal is only for the Macy’s building and parking lots, not all of La Cumbre Plaza.

La Cumbre Plaza is a total of 31 acres and has been included in the City of Santa Barbara’s 2023-2031 Housing Element plan in a list of suitable sites for new housing.

As I was standing in the Inclusive Arts Clubhouse space, I was imagining the sketches I was viewing of retail spaces, live-work lofts, restaurants, and residential rentals would be built on top of where I was standing. But then I saw the “you are here” map. Only the portion of La Cumbre Plaza with the Macy’s building (3805 State Street) and adjacent parking lots, an 8.7 acre site, is proposed for this “Neighborhood at State & Hope” mixed-use development.

The portion to the south of Macy’s, starting where Lure and Pottery Barn are now—including where we all were standing in the Inclusive Arts Clubhouse space—marks a long-term mall lease that doesn’t end until 2077, so it’s not part of this proposal.

Also important to note, another parcel to the south that includes the old Sears building is owned by Riviera Dairy and includes the old Sears building. Any proposed development there will be a separate project before the city.

2. This proposal isn’t new.

More than a year ago, in December 2022, the developers, Jim and Matthew Taylor, a father-son team from Santa Barbara, and MCP Santa Barbara LLC, submitted the first pre-application documents to the City of Santa Barbara, using a streamlined path made available under California Senate Bill (SB)-330, the Housing Crisis Act of 2019. MCP Santa Barbara LLC purchased 15 acres of the La Cumbre Plaza’s 31 acres about a year earlier in November 2021, but this proposal is only for 8.7 acres, as described in the section above. MCP is a partnership led by Jim and Matthew Taylor, backed by the Mandrake Capital Group.

The Taylors together have more than a 50-year history living in Santa Barbara with experience in hotel, commercial, and multifamily real estate development throughout South Santa Barbara County, California, and the Western United States. Jim Taylor was involved in the developments including Montecito Inn, Camino Real Marketplace, and Maravilla, and his son Matt joined him in the business in 2015.

In November 2023, the developers submitted updated preliminary application materials to the City of Santa Barbara and requested additional feedback on the project layout, which was revised to address initial comments. The updated proposals at the open house included 642 residential rentals—588 market rate and 54 deed-restricted to have affordable rents for individuals and families with annual incomes in the low and moderate categories (more in the next section).

These residential unit totals are down slightly since the earlier documents given to the city planning department proposing 685 residential rental units. Also in December 2022, the Santa Barbara County Association of Governments (SBCAG) rejected the City of Santa Barbara’s request for $1.1 million in state funds for a two-year master planning process for the entire 31 acres of La Cumbre Plaza. Now projects like this one can go through the city process separately instead of in one integrated plan.

At the Jan. 17 open house, there was also more visibility into 845 residential parking spaces underground, 105 retail parking spaces, a network of pathways and passageways, the types of buildings, and how they would be arranged on the site. Architects from local Cearnal Collective and partner architects from Northern California, David Baker Architects, as well as civil engineers from Flowers & Associates explained proposals and sketches on display, answered questions, and collected input from visitors.

3. State law determines the current number of subsidized affordable rents for 54 of these apartments.

The City of Santa Barbara’s Average Unit Size Density program requires projects of ten units or more to provide at least ten percent at rental rates affordable to moderate-income level households.

On top of that, the California Density Bonus Law includes tables of different percentages of additional density bonuses to allow more market-rate rentals that can be granted if developers include certain percentages of deed-restricted rentals affordable to low-income level households, very-low income level households, and moderate-income level households.

So what does each of these levels of household income mean? The levels of income are based on a household’s income relative to the area median income (AMI) of Santa Barbara County, also considering the size the household. The AMI changes every year, so by the time this project is built, the area median income will have changed again. As you can see in the 2023 table, the median income for a single-person household is $75,110 and the median income for a family of four is $107,300. The  very-low income level is 50 percent of the AMI, which means up to $51,800 for a single-person household or up to $73,950 for a family of four.  The low-income level is between 50-80 percent of the AMI, which means up to $82,950 for a single-person household or up to $118,500 for a family of four. The moderate-income level is between 80-120 percent of the AMI, which means up to $90,132 for a single-person household or up to $128,760 for a family of four.

So what would a subsidized affordable rent be for these households? Federal, state, and local housing assistance programs consider housing affordable to a household if less than 30 percent of a household’s gross income is spent on housing costs (including rent and utilities). Examples of subsidized affordable rents in a new housing development managed by the Housing Authority of the City of Santa Barbara at 821 State Street are $965 for a single-person with income up to $82,950, which is 80 percent of the AMI or low-income level. Rents are $1,610 for a single-person with income up to $90,132, which is 120 percent of the AMI.

The workshop included a map that showed the site’s location in between the county’s largest employers, and the Taylors have talked about the importance of providing market-rate “workforce” rentals, which is a different type of “affordability” if small units provide more market-rate rents that are closer to what employees of local jobs can afford without paying more than 30 percent of their gross income on rent and utilities. For example, rent of $1,900 for a studio apartment might be less than 30 percent of a 2-person household’s gross income, which makes it affordable for that couple for the year after the lease is signed, but it’s not guaranteed stay at that rate. Market-rate rents that aren’t subsidized can go up when the market goes up.   

One of the architects at the open house said that people were asking how they could get on a list to rent the new apartments at State & Hope, but there’s no waiting list available during this phase of the proposal. If you’re looking for affordable rentals and your income falls in the moderate or lower income levels of AMI, it’s best to get on all the lists for all the affordable rentals with the housing authorities: Housing Authority of…