Community & Economic Development Committee (CED) - 2026-02-23
Meeting Intelligence Preview
Meeting Summary
The Community & Economic Development Committee received status reports on housing production, special events permitting, and entertainment zones. Key findings showed 31,000 housing units are entitled across 103 projects citywide, but two-thirds are currently infeasible to build due to market conditions. The committee also learned that San Pedro Square's entertainment zone activation during Super Bowl weekend drew 48,000 attendees, with several establishments reporting their highest-grossing weekends ever.
Key Decisions (4)
Housing Catalyst Work Plan Status Report
Committee accepted the status report on housing production showing 31,000 entitled units across 103 projects, with approximately 60% market rate and 30% affordable. Analysis found two-thirds of projects are infeasible in current economic conditions. Staff completed P11 (SB Nine type housing) and group homes zoning updates on January 13.
Cost of Special Events Audit Status Report
Committee accepted status report on implementation of recommendation four regarding permitting coordination and timely invoicing. Police department has implemented eProval system as pilot. Citywide implementation estimated at $25,000-$45,000 annual subscription plus implementation costs, targeting June 2027 completion.
Entertainment Zone Status Report
Committee accepted status report on entertainment zone implementation. San Pedro Square Superfest during Super Bowl weekend drew estimated 48,000 attendees over three days. Several establishments reported highest-grossing weekends ever. All eight entertainment zones are now officially active.
Economic Development Activity Semi-Annual Report
Committee accepted semi-annual activities report covering October 2025 through February 2026, including Super Bowl activations, 2026 Creative Ambassadors announcement, downtown business openings, and Foreign Trade Zone program expansion to 11 companies with 7 applications pending.
Zoning Changes (2)
Citywide - various properties
City of San Jose
Citywide - group homes
City of San Jose
Development Activity (3)
Equinix SV12 Data Center
First facility to receive power under city's new PG&E agreement. Estimated $2.5 million annually in utility tax revenue once fully operational.
Gateway Tower
Heavily publicly subsidized tower project cited as exception to general tower infeasibility in current market conditions.
Google Development
Initial commitments driving significant portion of 31,000 entitled units citywide.
Market Signals (6)
Housing Demand
Two-thirds of 31,000 entitled housing units are currently infeasible to build due to market conditions, with towers being particularly challenging while townhomes and stacked flats remain more viable.
Housing Demand
Market rate rents in downtown and urban village areas are not growing sufficiently to support construction costs, particularly for higher-density development types.
Commercial Demand
San Pedro Square businesses reported some of their highest-grossing weekends ever during Super Bowl entertainment zone activation, suggesting strong demand for activated commercial districts.
Infrastructure
City's Foreign Trade Zone program has grown to 11 participating companies with 7 applications pending, on track to double participation by end of next fiscal year.
Sentiment
Developers report urban villages 'just don't work' due to lack of incentives, with majority of projects in some districts not requiring council approval or conformance to urban village plans.
Labor
Cost of construction for union versus non-union labor is beginning to flatten out at the higher end of the scale, affecting project feasibility calculations.