Developer Rincon Homes pulled its application for a four-story, 33-condo project in Carlsbad Village.
The project, known as Rincon Roosevelt, was initially on the Carlsbad City Council’s agenda on Tuesday after the city’s planning commission approved it in February.
Applicant Jonathan Frankel wrote a letter Tuesday to the City Council withdrawing the project application.
Frankel said that his company had been working with the city to address how to go forward.
“We felt it was important to take a step back and re-evaluate the proposal to assess potential alternatives,” he said. “We look forward to bringing forward a project that delivers affordable housing, supports small businesses, and implements the City’s vision for a vibrant village area.”
The withdrawal does not prevent the applicant from resubmitting the same or different development project application on this property, a city memo said.
The proposed project would have required demolishing eight existing apartments on the property, which the city said have specific protections under the Housing Crisis Act of 2019 because the tenants are considered low-income.
The applicant, Rincon Homes, agreed to incorporate the necessary conditions, but the law blocks the city from approving the project unless the requirements are satisfied, the staff report said.
The developers were also proposing using the state’s Density Bonus Law and including five lower-income units in exchange for a project that exceeds the 25 units allowed under the city’s current zoning.
City staff had said council members had discretion to approve the project or not Tuesday.
The city staff noted staff’s belief there is sufficient evidence to support denying the project because the applicant cannot demonstrate full compliance with the Housing Crisis Act’s tenant protection requirements.
Staff also said that the California Department of Housing and Community Development verbally told city staff that it “would not go after the city for approving the project” but declined to put it in writing, and that if the city approved the project the tenant protections would be included.
Update, 12 p.m. Wednesday, Sept. 30: This post has been updated to include comment from the applicant.