First look at Hillsdale Shopping Center revamp in San Mateo

Bohannon Properties, owner and developer of the site, submitted the formal application earlier this month.

The project will likely be a key source of the city’s Regional Housing Needs Allocation, or state-mandated housing goals. San Mateo must accommodate 7,015 units between 2023-31, and the project would satisfy about 20% of that requirement — though the entire development will likely take over a decade to fully build out.

Some residents have voiced concern over the impacts the massive development would bring to the area. In addition to impacts on traffic and public services, Dana Sahae, a nearby resident, said she is concerned about a potential grocery store loss, a much-needed amenity.

“The devil is in the details, and we don’t have all the details yet,” Sahae said. “I’m happy to see they have plans to put in space for a grocery store, but residents want to know that that grocery store is guaranteed, and that it’s an affordable option.”

Due to an increase in state housing law, the city is restricted in what kind of significant changes it can mandate. Sahae added that the concern over the city’s lack of leverage extends beyond Hillsdale and to other large-scale projects from which the city has received proposals over the last year.

“I understand the good intentions of those state laws, but I am frustrated that the people we’ve elected to represent us in our hometown don’t have the leverage to actually represent our concerns, because their hands are tied by state law,” she said.

The pre-application was filed under Senate Bill 330, which among other allowances, lets developers “lock in” impact fee calculations at the time of submission.

Mayor Rob Newsom said he also understands the purpose behind stricter state-level housing laws but agreed that it diminishes jurisdictions’ abilities to address resident concerns.

“Under the old way it would come through, the city could have some teeth and say, ‘You have to put in a grocery store,’ but it doesn’t have the ability to do that anymore,” he said.

David Bohannon, president of Bohannon Properties, said they are building a project that is responsive to the community — such as dedicating space for a grocery store — but the new legislation comes after years of cities, including San Mateo, repeatedly denying perfectly reasonable projects, simply because neighborhoods didn’t like it.

“It’s very difficult for communities to support real estate development, and that’s evidenced by over 30 years of communities up and down the Peninsula essentially saying no, repeatedly, including in San Mateo — or they’d condition the projects with too many things, and then it becomes infeasible,” Bohannon said. “I watched an incremental pressure from the state to get cities to voluntarily approve housing, and they resisted it.”

Some housing advocates have also noted that developers have a financial interest in making sure their projects attract prospective tenants, and not providing high-priority amenities, like grocery stores, would make their property less appealing.

Bohannon added that the project is a “significant contribution” to the city’s housing stock, and that there are “very negative consequences that we all experience from lack of housing in the Bay Area.”

The City Council will discuss the project Monday, Nov. 3.