Sand Hill Property Secures Major Fee Reduction for The Rise Development in Cupertino

Cupertino City Waives $77M in Fees for Sand Hill Property's The Rise Project

In a major business development, Sand Hill Property secures a substantial reduction in development fees with the City of Cupertino, potentially reshaping the landscape of the former Vallco Mall. The city has agreed to waive $77 million in fees, significantly benefiting Sand Hill's $4 billion project, The Rise, which aims to usher in a mixed-use development encompassing nearly 2,700 homes, retail spaces, offices, and more. This agreement marks a pivotal moment after a dispute over the fees, initially designed to offset the impact of public facilities due to the project's execution. Notably, Sand Hill, under the leadership of Peter Pau, contended that the fees were disproportionate, particularly given their plan to incorporate 890 affordable homes into the project. As part of the new deal, Sand Hill will proceed with payments amounting to $10.3 million for transportation fees and $32 million for other charges, resulting in substantial net savings of $34.7 million for the developer. Moreover, part of the endeavor is slated to be allocated for a public park, marking a notable community-oriented commitment. This settlement not only resolves the fee dispute but also positions The Rise to contribute significantly to meeting about half of Cupertino’s state-mandated housing goal for the next seven years, aligning with the mandate of introducing 4,588 homes by 2031. Sand Hill Property, renowned for its track record of over 65 projects in the Silicon Valley region, continues to expand its influence with this substantial achievement in Cupertino and advance plans for a new apartment complex in Palo Alto.

Key Takeaways

• The City of Cupertino exempts Sand Hill Property's The Rise project from $77M in fees.
• The Rise is set to encompass 2,699 homes, 226,400 sq ft of retail space, and 1.9M sq ft of office space.
• Sand Hill is responsible for paying $10.3M in transportation fees and $32M in other charges.
• A section of The Rise will be designated for a public park, reflecting a community-centric approach.
• The project is anticipated to play a substantial role in meeting half of Cupertino’s state-mandated housing objective by 2031.### AnalysisThe fee waiver presents a significant boost to Sand Hill Property, bolstering its financial standing and project viability. Cupertino's decision, driven by the imperative to fulfill housing targets, may strain public funds but augments local development efforts. In the short term, this move supports Sand Hill's expansion and contributes to addressing housing needs in Cupertino. Looking ahead, it could establish a precedent for future negotiations, exerting a significant influence on municipal budgets and developer strategies.### Did You Know?
  • Mixed-use development: A form of urban development that integrates residential, commercial, cultural, institutional, or industrial components in a physically and functionally interconnected manner, fostering pedestrian connections. This approach is often hailed for its potential to cultivate vibrant, walkable communities.
• Affordable homes: Housing available for rent or purchase at a price significantly lower than the prevailing market rate, typically facilitated through government subsidies or dedicated programs to assist low-income individuals and families. Within the context of The Rise project, the inclusion of 890 affordable homes serves as a pivotal initiative to combat housing affordability challenges.
• State-mandated housing goal: Refers to the defined targets set by state governments for cities and counties to plan for and accommodate a specified number of housing units, including provisions for affordable housing, within a stipulated timeframe. These targets are frequently part of broader state endeavors to address housing shortages and affordability concerns. In this scenario, Cupertino is mandated to fulfill a goal of 4,588 homes by 2031, with The Rise project poised to contribute significantly to this undertaking.