A pair of three-story buildings make up the residential development at 1482 Freedom Blvd.
A pair of three-story buildings would make up the residential development at 1482 Freedom Blvd. — a project that won city approval Tuesday night.
(Courtesy city of Watsonville (Rendering by Zimmerman + Associates))

Watsonville council approves two new apartment complexes, each with 50 or more units

The projects at 558 Main St. and 1482 Freedom Blvd. are in different neighborhoods and appeal to a variety of income levels. They’re also sparking discussions about Watsonville’s larger housing policies overall.

Two planned housing developments in Watsonville — one a downtown mixed-use project with some below-market-rate units, the other an apartment complex reserved exclusively for low-income renters — garnered approval from the city council on Tuesday evening.

In back-to-back votes, the council approved:

  • A 50-apartment project, known as The Residence, at 558 Main St. unanimously. The development, planned for a vacant 3/4-acre site, would include 10 “affordable” units — though some residents criticized the proposed market-rate rents as too expensive.
  • A 53-unit development for lower-income renters at 1482 Freedom Blvd. by a 6-1 vote. Mayor Jimmy Dutra voted against the project, which is in his district, citing concerns over parking issues on a nearby street and the development’s high density.

The discussion about 1482 Freedom Blvd.

Non-profit developer Eden Housing is behind the 53-unit project for low-income renters at the corner of Freedom Boulevard and Atkinson Lane. The two three-story buildings would include 11 one-bedroom units, 26 two-bedroom apartments and 14 three-bedroom units.

The complex, to be funded using federal low-income housing tax credits, would exclusively serve very-low-income and extremely-low-income renters.

Rents would be anywhere between 25% to 50% of the Area Median Income, according to Max Heninger, a project developer for Eden.

For a one-person household, that would mean an individual could make between $23,000 and $46,000 annually to be eligible for a unit. The person would pay between $580 and $1,240 in rent for a one-bedroom apartment.

A four-person household, meanwhile, can qualify with incomes between $33,000 and $66,000 annually. They would pay between $860 and $1,720 in rent for a three-bedroom apartment.

Developers for the project plan to serve families, farmworkers, those experiencing homelessness and people with disabilities.

The project earned praise and support from a number of residents and speakers.

Jan Stokley — executive director of Housing Choices, a nonprofit that aims to create affordable housing opportunities for residents with developmental disabilities — was among those encouraging councilors to approve the project.

“It serves an amazing array of high-need populations,” she said.

Although he said he liked the project, Mayor Dutra pointed out that there were no guarantees that all affordable units would go to Watsonville residents because some prospective tenants would come from a Housing Authority of the County of Santa Cruz list.

Atkinson Lane — where the project would sit on a vacant 1.8-acre lot near Wendy’s and the Watsonville Catholic Cemetery — already is “really, really slammed,” Dutra said, and parking is a “big issue.”

“We’re squeezing a lot more units in a lot smaller place,” he said, compared to other housing projects that have been approved.

The discussion about 558 Main St.

The four-story mixed-use project would be the first new downtown residential development in about three years.

It would include 1,950 square feet of commercial space on the ground floor facing Main Street where a restaurant would be situated.

The project proposes a mix of residential units on the other floors for a total of 15 studio apartments, 29 one-bedroom units and six 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.

Two units would be rented to median-income residents, two would be for low-income renters and three will be for very-low-income renters. Another three would be for Section 8 Housing Choice voucher holders who would pay a share of the monthly rent and have the rest subsidized by the federal government. The affordable units would be a mix of studio, one-bedroom and two-bedroom apartments.

During Tuesday’s meeting, some residents said the proposed rents were not in line with what the community is looking for in new housing, as Watsonville, like other communities, grapples with a housing affordability crisis.

Natalie Olivas, a community organizer with Regeneración – Pajaro Valley Climate Action, told council membbers that the project only provides the “very minimum” of 20% affordable housing.

“The pandemic continues to cause financial and social devastation throughout South County,” she said. “And I do not believe that this unaffordable complex properly addresses the worsening housing crisis in our area.”

Some on the council, however, said the community needs both affordable and market-rate units to help turn the tide. They also pointed out that the project would help increase property values downtown, providing the city with future tax revenue.

“When properties get developed, the property values increase, and we get more tax return on that,”council member Aurelio Gonzalez said. “So as a city that does us good.”

The developer on the project — Pacific Coast Development — anticipates breaking ground on it later this year. Construction is expected to last between 18 and 20 months and tenants would move in by summer of 2023.

Broader housing policy changes to come?

Tuesday’s discussions of the two projects also sparked potential future talks on broader development policy changes. Two council members said they would be willing to explore raising the city’s threshold for when a developer would be granted a density bonus — allowing them to build more units in a smaller space — for providing a greater share of affordable units — from the current 20% of affordable units in a project to 25%.

“We do need to increase the percentage as a city council, we may need to look at that, for affordable units that are going to be built downtown,” Gonzalez said. “Maybe we should push it to 25 because it is at 20 now. So those are the actions that we can take as a city council to try to create more affordable units downtown.”