50-unit apartment building proposed in heart of Watsonville

Watsonville could soon be seeing its first new downtown residential development in about three years.

The Watsonville City Council will soon vote on final plans for The Residence at 558 Main, which would would add 50 apartments — 10 of them affordable units — and street-level retail space for a restaurant in what is now an empty lot close to the intersection of Main and East 5th streets.

The 3/4-acre site previously had a building on it that had been home to a bank, a photography studio and a pharmacy at different times. That structure was demolished in 2019.

The Watsonville Planning Commission recently OK’ed the project last week, and is recommending the City Council approve it as well, at its Feb. 23 meeting.

The last downtown development of similar scale was the Terrace Apartments, a 54-unit building at 445 Main Street that houses Togo’s sandwich shop. It was completed in December 2018. The Residence at 558 Main is the only new downtown housing in the pipeline right now, according to Merriam.

However, it could be the first of several attempts to add housing stock to Watsonville’s historic heart, as the city prepares a plan to revitalize its historic downtown and surrounding areas. “There are several downtown property owners who are looking to do large, mixed-use projects in the future,” Merriam said.

In a recent survey, Watsonville residents expressed a desire to breathe new life into the downtown area, specifically by attracting a variety of businesses and diverse dining options, as well as more mixed-use and residential development. The city is plagued by (and trying to remedy) the same housing crisis facing the rest of Santa Cruz County and California at large.

558 Main St. in Watsonville in January, just before City Council was set to approve or reject the development project.

(Kevin Painchaud / Lookout Santa Cruz)

The ground floor of the 558 Main project would have 1,950 square feet of commercial space facing Main Street, as well as a 16-spot parking lot and dog park at the back of the property, with a driveway connecting to Brennan Street.

Plans show the second floor would have 16 units — a mix of studio, one-bedroom and two-bedroom apartments — and a lounge room and outdoor courtyard with fire pits, barbecues and a water feature. The remaining floors would each have five studios, 10 one-bedroom apartments and 2 two-bedroom apartments.

Rent for the market-rate units would start at $1,750 per month for a studio, $2,050 per month for a one-bedroom and $2,650 per month for a two-bedroom.

Due to the size of the project, Watsonville is requiring that 20% of the units be affordable. That means two units will be rented to median-income residents, two will be for low-income renters and three will be for very-low-income renters. Another three will be for Section-8 Housing Choice voucher holders who pay a share of the monthly rent and have the rest subsidized by the federal government. The affordable units will be a mix of studio, one-bedroom and two-bedroom apartments.

In exchange for making one-fifth of the project affordable, its developer — Pacific Coast Development — is asking the city to waive a requirement for on-site commercial parking.