Dozens of Cupertino residents will be displaced in favor of creating affordable housing for college students.
The Foothill-De Anza Community College District is the new owner of McClellan Terrace Apartments as of July 31, following a controversial $65.6 million deal with former owner Prometheus Real Estate Group. The sale will convert the 94 apartments, located at 7918 McClellan Road, into about 332 affordable beds for students struggling with living costs. The deal will displace existing tenants by June 2026, with the district set to shell out $3.2 million in relocation assistance.
The college district, which purchased the apartments with funding from an $898-million Measure G bond, is slated to approve its relocation assistance plan in September. It will help tenants who apply find comparable nearby housing for about $2,537 to $4,245 a month — what residents pay now in rent. The district will also pay households up to $5,250 for rent after June, along with some moving fees, per state guidelines. About 4.4 out of every 10 students in the district reported housing insecurity last year.
Chancellor Lee Lambert said as a renter himself, he understands his lease could be terminated on a yearly basis, similar to what the district is doing to existing tenants. He said the district considered other options, including building student housing, but decided on the purchase as an efficient solution because of the current need for affordable student housing.
Lambert said the decision was a balance between considering existing tenants’ needs and the demand for student housing. Students will start moving into already vacant apartments in the complex this year.
“The more that we can remove the students’ need to focus on their basic needs, the better because now they can focus on learning,” Lambert told San José Spotlight. “Reducing those friction points is critical.”
Prometheus Real Estate Group did not respond to requests for comment.
If there aren’t similar apartments available for existing residents when they have to move out, the Foothill De-Anza Community College District will authorize funds to provide housing as a last resort. Tenants eligible for this final option include residents whose replacement housing exceeds $5,250, or 30% of the person’s average monthly income.
That’s a real concern for two residents who spoke to San José Spotlight on condition of anonymity because they still live in the apartment complex.
One of the tenants said they’ve already looked at similar apartments in the area, and were told other potential residents offered to pay more than the rent listed — something the tenant can’t afford to do. They also said the apartment rents listed in the district’s relocation plan will likely be higher once next summer rolls around.
“We don’t want to interfere with students or students having housing,” the tenant told San José Spotlight. “But (the district needs to) be respectful.”
The apartment complex’s transformation will help students such as Stephanie Naranjo, a single mom studying radiologic technology at Foothill College.
Naranjo qualifies for the housing as a student taking at least eight credits, being 18 or older and not having a violent criminal record. She said living there with her children would significantly reduce stress caused by living costs and her current one-hour commute.
“That’s definitely a big win,” Naranjo told San José Spotlight. “Just as a full-time student, it is a big opportunity, not having to look out elsewhere or having to find strangers to live with that may not be on the same path as I am.”
Cupertino officials tried to stop the apartment complex’s conversion to prevent displacement, but the city doesn’t have much control over the transformation because it’s a deal between two private entities.
Mayor Liang Chao is concerned Cupertino will permanently lose 94 homes that are more affordable than other apartment complexes in the city because of their age. She supports affordable student housing, but wants it built on campus to avoid displacing existing tenants.
“I urge the (college) board to work collaboratively with the Cupertino City Council on future land use decisions, especially those involving taxpayer funds, to ensure transparency, fiscal responsibility and alignment with community priorities,” she told San José Spotlight.
Contact Annalise Freimarck at [email protected] or follow @annalise_ellen on X.
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