Item 33 - Second Extension of Entitlements for the Madison Mixed-Use Development (200 North Cabrillo Park Drive)

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Second Extension of Entitlements for the Madison Mixed -Use Development (200 North Cabrillo Park Drive) November 21, 2023 Page 2 approval. This section also allows the property owner to request an extension of the entitlement up to a period of three years from the date of the expiration. The subject entitlements were in effect until June 5, 2020; however, due to difficulties stemming from the COVID-19 global pandemic, which affected the development industry worldwide, the applicant experienced delays in moving the project forward and constructing the new mixed -use development. During this time, a state of local emergency was declared stemming from the COVID-19 pandemic, which provided relief to residential developers by extending approvals of residential entitlements to December 31, 2022. The applicant had submitted construction drawings into plan check on August 14, 2022, and was working through the plan check process when they requested the first one-year extension of the site plan and variances. The City Council approved the first one-year extension, which extended the entitlement approval through December 31, 2023. Analysis Due to increased cost of materials, changes in construction loan interest rates, labor shortage, and market changes impacting the applicant's ability to develop the project, the applicant is requesting a second one-year extension through December 31, 2024. Specifically, recent increases in interest rates beginning the first quarter of 2022 and continuing through 2023, and their impacts on construction loans and land development costs, have resulted in additional delays to the project's ability to complete the plan check process, pull permits, and break ground on the project by the December 31, 2023, deadline that was established the City Council -approved entitlement extension. As a result, the applicant is requesting a second one-year entitlement extension pursuant to Section 41-647 of the SAMC. In an effort to encourage construction of entitled projects, it is the Planning Division's policy to recommend no more than one- year extensions at a time. The applicant has since completed the building plan check process and is working through the Public Works Agency's review process, which would need to be completed prior to permit issuance. Following the completion of the plan check process the applicant intends to obtain their permit and begin construction in third quarter of 2024 in order to effectuate its entitlements within a timely manner.