After years of being stuck in the planning stages, a sleek seven-story apartment complex is finally breaking ground, all thanks to the city’s clever multifamily housing incentive program. Led by Hanover Company, this 345-unit development is bringing much-needed homes—including affordable ones.
This project was gathering dust since getting the green light in 2022, held back by financing woes. Then San Jose stepped in with its incentive program, launched late last year, offering developers a lifeline through fee and tax breaks. For Hanover, it was the push they needed. Now, construction is rolling, with a finish line about two years out. The complex will offer a mix of studio, one-bedroom, and two-bedroom units, with 5% set aside as affordable housing for folks earning the area median income. There’s even 3,000 square feet of office space to spice things up along North Capitol Avenue.
What’s the magic behind this incentive program? It cuts costs in smart ways. Developers who include at least 5% affordable units onsite—like Hanover did—skip the usual “in-lieu” fee tied to the city’s affordable housing rules. Park fees get trimmed for projects with private amenities, and construction taxes take a hit too, with big reductions for the first 1,500 units approved by 2025. It’s a practical move that’s getting shovels in the ground and homes in the pipeline.
The perks don’t stop at housing numbers. This development sits less than half a mile from the Penitencia Creek Light Rail Station, putting public transit within easy reach. And for anyone who loves a good bike ride, the project includes two new bike lanes along North Capitol Avenue, linking up with the Penitencia Creek Trail.
Source: SVBJ
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