Quick Take:

The Argus Company, a small used-car dealership, could be seeing a grand new neighbor in the coming years, as yet another Water Street mixed-use project enters the early stages of planning. The public response to the 105-unit proposal is just beginning.

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Controversy has stalked the 831 Water Street project, the mixed-use Santa Cruz development involving two buildings, one at four stories and one at five, totaling 140 units and 90,536 square feet at the intersection of Water Street and North Branciforte Avenue east of downtown.

Will a new mixed-use development slated for parcels located just across the street draw the same ire?

That project is called Stanford Studios, and includes parcels at 915, 917, 919 and 923 Water Street, directly adjacent to The Argus Company, a small car dealership. It’s a project in “preapplication,” or early status. That means the project plan, received by the Santa Cruz city planning department in late May, is now getting early review and feedback from relevant city departments and the surrounding community through public outreach meetings, of which one has been held so far.

You might well have passed that corner of Water and Branciforte and seen the mix of used Volkswagens, BMWs, Mercedes, Porsches and more squeezed into the small car lot at the intersection. Argus Company owner Mike Gay said that unlike with 831 Water, initial conversations regarding the Stanford Studios project have not concerned him much.

“I know that there are ongoing talks with the neighbors around here, but I’m personally not too worried about it,” he said. “It seems like the developers are trying to do the right thing, and I think they’ll do it right.”

The one community meeting regarding the new project took place Sept. 7. Nearly 40 members of the public attended that meeting, where they raised familiar concerns, City of Santa Cruz Senior Planner Tim Maier told Lookout on Thursday.

“The feedback was pretty consistent with what we’ve seen for most development projects,” he said. “Largely things like size, adequacy of parking capacity, traffic impacts and shading and shadow impacts are brought up a lot.”

Overall, the project involves the demolition of the current residential and the now-empty commercial buildings that formerly held A Festive Affair Party Rentals and Classic Glass Co. It would encompass 74,770 square feet and include:

  • 105 single-room-occupancy residential units broken into three stories of 35 units per floor with individual bathrooms and kitchens;
  • a shared laundry facility on each story;
  • 981 square feet of commercial tenant space;
  • parking containing 57 vehicular parking stalls,
  • a bike storage room with capacity for 136 bikes;
  • a lobby, leasing office, loading space and mailroom.

The project would also include private and shared outdoor space, rooftop solar and electric vehicle charging stations. The current proposal also seeks to provide 20% of the units at the very-low-income level to allow for a 50% density bonus as the city continues its attempt to chip away at the great number of housing units it needs to build by 2031. As such, this project is one that will see the Water Street area and Santa Cruz as a whole transforming as older low-rise buildings give way to mid-rise and higher.

Maier said that while the project is “in a broad sense, subject to state regulations like all city actions,” it is not a Senate Bill 35 (SB 35) project. In other words, this development is not a product of the state-mandated growth that 831 Water has found itself tangled up in.

Another timely question for those watching the rezoning and push for more housing: Will major rezoning and impending implementation of new objective design standards, set for discussion and a vote at the Nov. 15 Santa Cruz City Council meeting, affect this proposal?

No, they won’t. Because this preapplication has been completed prior to approval of both the proposed rezoning and new objective design standards, the current zoning — community commercial, which allows for a variety of commercial and service uses — is locked in for this project.

However, because this prevents the parcels from taking on the mixed-use high-density designation planned for them, the development will require a special-use permit to allow for the mixed-use vision for the project. That triggers a planning commission review to ensure that the development is in accordance with city regulations, and that it will not have negative impacts on the neighborhood.

After all, Argus Company owner Gay says that while he is typically anti-growth, change might not be the worst thing for the empty and decaying parcels — but it must be well executed.

“That property there has been a mess for a while now, and I’m OK with something new if it’s done correctly and makes sense,” he said.

Max Chun is the general-assignment correspondent at Lookout Santa Cruz. Max’s position has pulled him in many different directions, seeing him cover development, COVID, the opioid crisis, labor, courts...