Vallejo Planning Commission approves building more housing on new Costco development

VALLEJO - The Vallejo Planning Commission approved a plan to incrase the housing units that will be built at a new Costco store site under development in North Vallejo.

The commission voted unanimously Monday to amend the Fairview at Northgate Master Plan to increase the number of homes built on the new Costco site, from 178 to 245.

The plan has been underway since 2020 to build a 152,000-square-foot Costco store along with a 30-pump gas station and 23,000 square feet of retail on undeveloped land at Admiral Callaghan Land and Turner Parkway. 

The amendments approved Monday included dividing the 23-acre parcel with single-family homes and clustered homes on a condominium map. The plan also includes a central open space buffer to protect wetlands between the commercial and residential portions, as well as new streets, sidewalks, lighting and a one-acre neighborhood park with two smaller parks. 

The developer’s project manager, Danny Luu of Lewis Group of Companies, said the goal was to reduce the size of the lots for the planned single-family homes from 3,200 square feet to 2,814 square feet to be able to build 119 detached single-family homes and 126 small "bungalow" style homes. The latter “clustered” homes for sale will be constructed in groups of three units.

With the approval, the property can enter the land development phase later this year with construction of homes starting in 2027, city staff said. 

Luu said the company has operated across California and Nevada since 1955 and has developed more than 58,000 homes. Lewis Group of Companies has more than 10 projects underway across Solano County.

While Costco currently operates more than a mile away along Plaza Drive, Luu said the retail component of the project is important: “Costco is the single highest tax generating business for the city of Vallejo. 

“Keeping Costco in the city is critical for Vallejo's economic stability,” he added. “We’re not just maintaining it in the city, we’re putting it in the position to grow.”

However, several commissioners were skeptical of the fact that the plan does not include any affordable housing, which Luu said his company has never built. The proposed "bungalow" homes would be priced for sale starting around $550,000, depending on the market, he added.

Without an inclusionary zoning policy, the city cannot require developers to build affordable homes within new building projects. Vallejo is currently considering an ordinance to create this kind of policy, with staff soon bringing a draft to the City Council.

Vice chair Donald Douglass said homes which could cost more than $600,000 once they are completed within the next several years may be out of reach for many local families looking to buy a home.

“It pretty much knocks a lot of people to the curb - you know, young people trying to start families and things like that,” Douglass said. However, he also complimented the project for its plan to create more housing, saying “You’ve stuck with this for a long time.”

Chair Anthony Taylor said while he sees how the project addresses local housing needs, he wondered if the city could work on a way to help make the homes more accessible to people who cannot afford the price point. 

“If someone is making $25 an hour, I don’t see how they can meet that price point with a family,” Taylor said. “I would like to see affordable housing or housing available for various income points, if possible.”

Commissioner Tara Beasley-Stansberry said she wondered if the developer was the right choice for the project without experience building affordable housing. However, she added “I know we don't have an inclusionary zoning policy, so it's very difficult to navigate those waters with developers that don’t have that expertise.”

Stansberry added, “Who doesn’t want a bigger Costco? We need that desperately, and it will attract people from other cities. People travel from here to Napa Costco. Let’s also remember that they are a large employer and they pay taxes and we do need them.”

City staff said the motion on the table was only for correcting the property zoning map and amending the number of homes to be built. Luu pointed out the company's efforts to increase density by reducing the planned lot sizes. 

Resident Jose Carrizales said in public comment that the city needs housing opportunities like this development. 

“What you have before you is an opportunity to build housing,” Carrizales said. “We have so many empty lots here. We don’t know what the price point will be in a couple of years. But what’s important in the city of Vallejo is housing - we need it.”