Housing in North San Jose is underway on former Japanese farmland

Construction is underway on the first installation of a multifamily housing and retail project in North San Jose on former Japanese-owned farmland.

Mayor Matt Mahan and North San Jose Councilmember David Cohen broke ground on the 0 Seely Ave. site Friday, as the area once surrounded by trees and farm structures was flattened to make way for 1,472-new homes. The Hanover Company, the project’s developer, plans to bring the first nearly 400 homes online in 2027.

The housing development described as “much-needed” by Mahan was controversial among preservation advocates who objected to the removal of a farmhouse once owned by World War II Japanese internment camp survivor Eiichi “Ed” Sakauye. The farmhouse has since been placed on a moving truck as it awaits funding for its future location at History Park.

Scott Youdall, who represents the developer, said plans for the upcoming Coyote Creek Village neighborhood include an homage to the Sakauyes.

“We’ll have all ranges of incomes, community and retail all centered around a new city park named after Eiichi Edward Sakauye — a prominent San Jose figure whose family farmed on this land for generations,” Youdall said Friday. “Make no mistake, the only reason we’re here today … is because this mayor and this council had the vision.”

San Jose has broken ground on more than 700 multifamily homes since the start of the year, a total reversal from last year when it built none.

Mahan credits the passage of his Multifamily Housing Incentives Program for bringing so many developers to San Jose with the promise of a 50% tax cut on housing development through the rest of the year. He said the program helped jumpstart the North San Jose project.

“We’re optimistic that by the end of this year, over 2,000 new homes will be under construction in San Jose thanks to this incentive,” Mahan said Friday. “Just this last week, Council voted unanimously to expand, adding a Federal Realty project, which will bring an additional 258 homes to San Jose. We’re reviewing more projects in the pipeline that might benefit from this incentive.”

Federal Reality, a San Jose housing developer, was retroactively added to the list of developers with projects eligible for the Multifamily Housing Incentive Program during Tuesday’s City Council meeting.

Publicly-traded Federal Realty Investment Trust is the developer and principal owner of Santana Row in the West Valley.

Councilmembers will decide at a June 17 meeting whether to grant Federal Reality $7.9 million in tax cuts and a $3.4 million refund the developer previously paid in in-lieu fees for not meeting the affordable housing minimum requirements.

Mahan told San José Spotlight the city needs to assist builders in getting the thousands of homes already approved started.

He said cities across Texas and Colorado charge just a few thousand dollars in one-time fees to developers per home built, while California charges around $29,000, not including affordable housing fees.

“We have something like 6,000 or 7,000 (homes) entitled that we’ve said ‘yes’ to that aren’t getting built because the cost of construction is too high and it just doesn’t match — they don’t pencil,” Mahan told San José Spotlight. “So we have to look again at what else we can do to help these projects pencil so they can secure financing.”

Cohen said he wants Coyote Creek Village to be among the neighborhoods to turn North San Jose into an active hub like downtown. The nearby River Oaks community is excited about the project, he said.

“It is going to bring not only a lot of housing units, but another 2-acre park, which will be very important for this community that doesn’t have enough park space,” Cohen said Friday. “It also will have the first dog park in North San Jose, which is really important for the community.”

Contact Vicente Vera at [email protected] or follow @VicenteJVera on X.