Coyote Valley is San Jose
’s most ambitious and prominent development project, but it’s
only one, and even staunch supporters of the planning process
wonder if the city is trying to do too much too soon to attract
business back to a city that has lost almost a quarter of a million
jobs in the last five years.
Coyote Valley is San Jose’s most ambitious and prominent development project, but it’s only one, and even staunch supporters of the planning process wonder if the city is trying to do too much too soon to attract business back to a city that has lost almost a quarter of a million jobs in the last five years.

In addition to the Coyote Valley Specific Plan, which imagines a live-work community of 25,000 homes, 50,000 jobs and 80,000 residents, San Jose hopes to bring 25,000 jobs and 70,000 people to the North First Street corridor, and 30,000 jobs and 10,000 housing units to downtown. San Jose is also pushing forward a bio-tech incubator in Edenvale, and developing new housing and retail jobs in Evergreen.

All this even though nearly 20 percent of downtown office space is vacant and commercial real estate agents don’t see more employers coming to town in the immediate future.

“The reality is that only a regional transportation system will save downtown from itself,” said David J. Buchholz, a vice president with Colliers International, a commercial broker in San Jose. “Developers prefer to be in areas that have proven successful. Edenvale and Coyote Valley aren’t really proven out.”

The regional transportation system that could save downtown is BART, but despite the city’s dedication to bringing the train to San Jose, the project is very tenuous. The $4-billion project is dependent on sales tax revenue from a still-slumbering economy and almost $2 billion in state and federal funding that will depend in part on the city’s ability to demonstrate that it can attract 70,000 riders a day. And some city officials see Coyote Valley as a direct threat to downtown.

“I think planning for Coyote when we don’t have pressure for development makes sense because you’re able to get more livable, walkable communities, but we have expectations for housing and job density downtown for BART to survive, and we can’t do anything to jeopardize that,” Councilwoman Linda LeZotte said.

Groundbreaking could occur as early as 2007.

And while the city is often praised for the smart-growth philosophies underpinning Coyote Valley, some environmental advocates say the scope of the plan will likely outpace the $1.5 billion that homebuilders have committed to bring it into reality and take away from less environmentally sensitive projects.

“The plan is becoming so costly that the city will be asked to fund certain pieces of it, and if that happens, other projects will suffer,” said Michele Beasley, of Greenbelt Alliance. “We don’t want Coyote Valley to be a drain on the rest of San Jose, and I think council members, representing their respective districts, will want to understand how that might happen.”

LeZotte said San Jose needs to be mindful of commitments its made to other parts of the city. Focusing on North First Street and Evergreen make sense because those areas already have infrastructure to support new tenants. That means not only buildings, but the water, sewage and transit facilities lacking in Coyote Valley.

“We need to encourage homebuilders and developers to come to North First and ensure that there are opportunities to participate or it will die,” LeZotte said. “We have such large investments in downtown and North First that I want to see those investments take root, and grow and mature, before we start digging dirt in north Coyote.”

She is not alone. At a recent city council meeting, Chuck Reed, who represents northeast San Jose, said he doesn’t want the city to “carry the new town concept to the point where it creates a new downtown.” Council members David Cortese and Cindy Chavez have expressed similar concerns.

But every time the council has had an opportunity to give the Coyote Valley Specific Plan a thumbs up, it has done so unanimously, and San Jose Deputy Planner Laurel Prevetti said after the approval that Coyote Valley will not interfere with the city’s other development plans because it’s on a much longer time horizon.

“We aren’t being pressured to accommodate some new corporate entity so we have time to engage in a planning process and work with the community,” Prevetti said. “Down time is the best time to engage in a thoughtful planning process. Planning Coyote Valley and actually building it up are two different things. There will be no development for a number of years at least in mid-Coyote.”

North Coyote is already home to IBM, and Cisco Systems Inc. owns land there. Buchholz said that any new corporate clients in Coyote won’t be pulled from other areas, but the lack of infrastructure and an employee base in Coyote Valley are a drawback.

“Tenants are very specific about where they want to be, and it’s all about convenience for your employee base,” Buchholz said. “Developers don’t create demand. What San Jose is doing is allowing companies to develop and letting the market grow organically. Organic growth will always be where the employee pool is already established.”

Residential targets for Coyote Valley are more than three decades away, and it will ultimately be up to the city council to decide when to move forward with infrastructure work on Coyote Valley. Prevetti said the council won’t be choosing between Coyote Valley and other parts of San Jose, but making decisions about the future of growth around the state.

“How we create development opportunities within our existing areas to meet growth projections without putting pressure on lands in the Central Valley and more rural areas, that’s the policy question that will be before the council when we’ve completed the environmental impact report,” Prevetti said. “Then they can consider the entire package.”

Gilroy Dispatch reporter Matt King covers Santa Clara County. He can be reached at [email protected] or 847-7240.

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