Corona development sparks debate over housing density

As the future of the east Petaluma SMART station remains entangled in litigation, the developer tied to the deal is weighing a housing proposal that critics say falls short of the city’s need for maximum density projects at transit-oriented sites.

Representatives from Lomas Partners presented site plans at last week’s Know Before You Grow development forum that feature 112 single-family homes for a 6.5-acre parcel at the corner of Corona Road and North McDowell Boulevard.

If the pending lawsuit between SMART and the developer can be settled amicably, a portion of the property would be set aside for a 150-space parking area to accompany the long-awaited suburban train stop.

But with the fate of the terminal uncertain, attendants at the forum criticized a housing proposal that offered for-sale residences starting at $600,000, pitched as entry-level homes for young families struggling to find market-rate options in Petaluma.

Part of the contract the two parties signed in August 2017 was the development of a SMART-owned parcel on D Street to add coveted housing and parking at the downtown depot. The Corona project was initially part of a land swap with the rail agency that would have put a 300-unit complex and 75 parking spaces near the downtown station, but is now on hold.

Lomas principal Todd Kurtin, who pointed to the nearly 1,300 multi-family units already in the city pipeline, said building the Corona development at that high of a density would be economically unfeasible due to the region’s high construction costs, and also didn’t necessarily align with the current needs of a community where single-family options are in short supply.

“There’s enough apartments being built in Petaluma,” he said at last week’s gathering. “In my mind - and I may be wrong - I don’t think people in Petaluma want to live in apartments. This is a community that wants to live in a house.”

Last week’s presentation was the centerpiece of the latest Know Before You Grow meeting at the Petaluma Community Center. The citizen-led group hosts discussions on topics designed to make development projects accessible to a casual resident, and drive conversations on sustainable growth.

During the Q&A session, the forum took a contentious turn as several attendants began pressing Kurtin and his team on the decision to pass on apartments at a potential transit hub, opting instead for higher density, for-sale units. Former city planner Pamela Tuft, who helped write the River Access and Enhancement Plan and directed the Petaluma River Flood Control Project, is consulting for Lomas on the Corona development.

The proposal consisted of detached and clustered houses similar to the iconic residential areas in San Francisco, each with three floors and options for 2-4 bedrooms per unit, ranging from nearly 1,600 square feet to over 1,800. Each residence included a two-car garage on the bottom floor.

Under the city’s inclusionary housing policy, 15 percent of the homes would be set aside at an affordable rate.

The projected sale price for the smallest units in the development would be lower than the existing market averages. The current median home price for listings in Petaluma is $699,900, and is forecasted to rise by nearly 6 percent over the next year, according to the website Zillow.

“I’d love to see high density,” Tuft said during the presentation. “But I’ve sat in so many public hearings where we were right on the cusp of looking at the density bonus (from the state) and the neighborhood fought the subdivision so passionately that the density was reduced to below the maximum. This community doesn’t embrace high density, even in the urban core.”

Despite the hybrid approach, building 22 for-sale units per acre, the audience questioned the sustainability of a project that was next to a potential commuter station but didn’t include multi-family units that could put a bigger dent in the housing shortage.

Jenny Griffo, a Petaluma-based developer and co-founder of Griffo Distillery, pushed back against the notion that building apartments was economically unfeasible, or that Petaluma residents would prefer for-sale homes over rentals.

She said her workers at the distillery, many of whom are paid just above minimum wage, struggle to find affordable housing locally, and would benefit from new options for working-class residents.

“This is a pretty pivotal parcel in Petaluma, right next to a potential SMART train,” Griffo said. “It seems extremely counterintuitive to me to put single-family homes next to a train station. This is right where we want to increase our density and make sure our entry-level (residents), teachers, and my staff can rent a place to live.”

Some audience members suggested Lomas should wait until the SMART case is finalized before submitting an application. Others raised concerns over the walkability of the current proposal, and the traffic issues that would arise at an area already plagued by congestion.

“We heard the comments,” Kurtin said during an interview this week. “We’re digesting them and figuring out how to move forward.”

The deal between SMART and Lomas fell apart in early 2018 after an alleged breach in the agreement triggered a termination of the deal. SMART representatives claimed a change in Lomas’ proposal to build a parking lot rather than a garage constituted a breach.

Lomas filed a lawsuit contending SMART’s decision to walk away from the contract was not done in good faith, and every attempt to salvage the deal had been ignored. A trial is currently scheduled for May.

SMART representatives declined to comment.

Kurtin said the two sides held a mediation meeting earlier this month and the nature of the talks are confidential, but he remains committed to reaching a resolution that would include an east side station at the Corona site.

“I continue to stick up for (Petaluma) and try and work out a way to make this happen,” Kurtin said. “I’m not going to give up. I’ve been working on this way too hard, and I feel a passion for this community.”

(Contact News Editor Yousef Baig at yousef.baig@arguscourier.com or 776-8461, and on Twitter @YousefBaig.)