In this post we go into the details of the Builder-Politician Complex controlling Cupertino.
Investors from rapidly growing international economies want to invest globally. Our home, Cupertino, a city with global name recognition, has become a preferred destination of investors, big & small, who want real estate to be a part of their global portfolio
This has created an interesting dynamic where investors buy real estate in Cupertino, with the intent of getting the property rezoned. Their goal is to dramatically increase the built-up square footage to maximize the return on their investment. Without any roots in the city, they do not care about the impact of their actions on the city or its residents.
The most well-known of such entities is Sand Hill Properties (SHP), which includes Abu Dhabi Investment Authority, a sovereign wealth fund of the Emirate of Abu Dhabi as an investor. SHP bought the Vallco Mall zoned for retail in 2014 for $320M, with the sovereign fund as an equity partner.
With recent changes related to rezoning of single family home lots to allow multi-family homes (condos/townhomes), home owners have also started receiving buyout offers from developers.
The Builder-Politician Complex
An industry has sprung up in Cupertino to guide investors on how to navigate the process: which we call the Builder-Politician Complex. Along with local politicians, the complex includes astro-turf YIMBY groups whose takeover of the Cupertino City Council we covered in this article.
The Builder-Politician Complex works to enrich the investors by facilitating high density infill construction, without regards to the impact on existing residents, many of whom spent their life-savings. In return politicians get favors including big campaign donations and PAC support to win elections.
SHP leveraged the politicians it supported to change the zoning to construct real estate which could be worth $6-7B, almost a 20x multiple to their original investment. Even though there was enormous opposition amongst residents, especially to new office space, the City Council (Rod Sinks, Gilbert Wong, Barry Chang) was too beholden to SHP to effectively represent the will of the people.
SHP Gets 2M Square Feet of Office Space
One of the most controversial decisions was to grant SHP the right to build 2M sq ft of office space at Vallco. To do that, the city council amended the city’s General Plan to create a new allocation of 2M sq ft of office, and then also decided to grant almost all of the new allocation to SHP’s Vallco project (December 2014). Communication between SHP and the City Council showed Peter Pau demanding 2M sq ft of office space from the city council, and the council lacking the spine to stand up to him.
During the City Council meeting on Dec 3, 2014, then Mayor Rod Sinks agreed to not discuss office space allocation in the General Plan amendment, but late at night Rod Sinks, Barry Chang and Gilbert Wong bring it up, and voted on it after most residents had left. You can watch key excerpts from the meeting in this Youtube video
City Council Gives SHP More Density in Special Plan than they Asked for in Measure D
Between 2014 and 2017, SHP negotiated with the City to come up with a Vallco Specific Plan (VSP). While they were in the middle of the negotiations, they also tried to bypass the city by going directly to the voters in the 2016 election under Measure D, which did not pass.
After Measure D failed, the city negotiated a Vallco Special Plan (VSP) with SHP which was passed in 2018. The VSP negotiated by the politicians had even higher density than the Measure D plan originally proposed by SHP but rejected by the voters!
SB35: The Alternate Plan with NO Height Limits
In parallel, SHP also started work on an SB35 project which bypassed the city council, needing just ministerial staff approval. The city had removed height limits on Vallco in 2014.
In Fall of 2017, when SB35 was close to becoming law, City Council members Darcy Paul and Steven Scharf brought attention to a loop-hole which would allow SHP to have unlimited height under their SB35 proposal. Rod Sinks agreed that this was an area of concern and supported them stating that “I am personally OK with special meetings, extra meetings or whatever it takes” to ensure proper limits are put. Two weeks later, when the topic was being discussed in the next city council meeting, Rod Sinks decided not to support it along with Barry Chang and Savita Vaidyanathan.
As a result the city did not put any height limits on Vallco; in principle SHP can build a Burj Khalifa on that land.
You can watch a 7 minute video covering both the meetings below.
Builders Dominate in the Builder-Politician Complex
This event is illustrative of how local politicians’ relationship with the developers impacts their decision making. Rod Sinks served in the Cupertino City Council from 2012 to 2020, and is also running for Cupertino City Council election again in 2024.
Rod’s U-Turn to not put any height limits on Vallco illustrated how once our politicians are beholden to the developer, they lose their ability to act in residents’ interest. It was clear that Rod felt that having no height limits on a project not requiring a council approved plan, was not appropriate. However, the developer lobby pressured him, and he yielded to their pressure two weeks later.
Firing the City Attorney: Randy Hom
In 2018, when the SB35 plan was being reviewed by the city, the City Attorney Randy Hom stated that in his opinion, the plan submitted by SHP did not meet the criteria for ministerial approval by the City. Rod, Barry and Savita collectively acted to fire our city attorney, Randy Hom due to his opposition to the SB35 approval. SHP’s SB35 plan was approved ministerially after the City Attorney’s firing.
Rod Sinks: SHP’s Face to the Opposition of the Referendum
The city residents were so upset with the VSP negotiated by our city-council that they organized a petition to demand a referendum in the city to revisit the Vallco Special Plan. SHP used Rod’s pictures and statements on flyers to ask residents to not support the referendum to vote down the VSP.
The flyers being passed around stated that since the alternative SB35 plan had very high towers, opposing the VSP was against residents’ interests.
The irony is that the reason the SB35 plan had high towers was because Rod yielded to the developers to not put any height limits on Vallco! Further, the SB35 plan would not have received ministerial approval if Rod had not conspired to fire the City Attorney whose legal opinion was against approval.
Cupertino’s residents also organized a change.org petition to censure him, bringing up six years of Rod’s actions benefiting SHP.
Politician’s $77 Million Gift to SHP
Recently Cupertino City Council granted Vallco a $77 million waiver of impact fees they were supposed to pay to the city for their giant project. Cupertino’s finances are already in trouble since changes in sales tax law will reduce our income from Apple’s sales in California.
From Vallco to Single Family Lots
The Builder’s control over the city’s politicians is now impacting single family neighborhoods. The City Council led by builder-supported members (JR Fruen, Hung Wei and Sheila Mohan) tried to change the general plan to allow all corner lots in single family neighborhoods to be converted into R3 multi-family (condos/apartments) (Strategy HE-1.3.6). Earlier, their decision to not adopt a Housing Element, which was ready in October 2022, also led to the city accepting Builder’s Remedy projects in 2024.
More Office Imply RHNA Ask for More Homes
The number of new homes the city is expected to build in every 8-year RHNA planning cycle also depends on the number of workers in the city. The city is already reeling under the impact of the upzoning facilitated to build the 4588 homes required in the 2023-2031 cycle. With 2M more sq ft of office space, even more homes will be required in the next cycle, starting 2032.
Rod Sinks: Poster Boy of the Builder-Politician Complex
Rod Sink’s actions illustrate how politicians beholden to developers, are unable to effectively serve the interests of the residents of Cupertino. Rod not only facilitated a massive office allocation which Cupertino did not need, he also put a gun to our heads by lifting all height limits on the Vallco Property. The Builder, SHP, then used his picture and letter, in their failed attempt to abort the referendum
Cupertino deserves transparent decision making which considers the interests of all the stakeholders, especially the residents. We should not vote for those who have a record of striking back-room deals with developers.
Reclaim Cupertino from the Builder-Politician Complex
Rod Sinks, Barry Chang, and Gilbert Wong have a long, well documented track record of serving developer interests. They are a core part of the Builder-Politician Complex ignoring the residents’ quality of life. All three of them are standing for the two seats up for election in 2024. It is up to Cupertino voters to reclaim our beloved city from the Builder-Politician Complex by not voting Rod, Barry and Gilbert back to the City Council.
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