In the late 1990s and early 2000s, industrial properties in the area north of the 101 Freeway and west of Lindero Canyon Road started to redevelop with non-industrial uses. These changes were reflective of increasing land values and declining demand for industrial space in the region. The original development scenario for the Specific Plan selected by the City Council in 2011 included an assumption that some properties in the area would redevelop with residential uses given the high land value and increasing housing demand in the region.
By the time the original draft Specific Plan was completed in 2014, the City was out of compliance with state housing laws because it did not have a General Plan 5th Cycle Housing Element certified by the Department of Housing and Community Development (HCD). The City was unable to demonstrate through its General Plan and zoning that it had adequate capacity for additional housing units to provide its share of regional housing needs. To get its 5th Cycle Housing Element certified as required by state law, the City would need to increase its residential capacity by rezoning non-residential land to allow for residential development. Rather than looking for other locations in the community to rezone for housing, the City proceeded with the understanding that the required housing capacity would be provided by the Specific Plan since it had already been in development for several years and had already been identified as an appropriate area for additional housing.
It is important to note that the purpose of the Specific Plan was not simply to provide the housing capacity required by the state. While the residential capacity provided in the Specific Plan was utilized for the 5th Cycle Housing Element, the need for a framework to guide redevelopment in the area was recognized as early as 2007, and the preferred development scenario approved by the City Council in 2011 included residential development.