Our COO, Josh Burroughs, recently joined as a panelist at the City of San Jose Council Study Session focused on the Cost of Residential Development in San Jose, exploring strategies to support the City’s focus on building more housing. With decades of experience in San Jose real estate and multiple high-rise developments under his belt, Josh offered both context and actionable insights into the city’s housing market.
San Jose’s Housing Production in Context
Josh highlighted that while San Jose produces a significant volume of housing compared to neighboring cities, per capita metrics show there is room for growth. Neighboring cities are producing 5–10 times more housing per resident despite facing similar construction costs, land prices, and impact fees.
DEC 8, 2025 | City Council Study Session: Cost of Residential Development in San Jose | Josh speaking from 1:07:22 - 1:13:45
Market-Rate Development and City Growth
Currently, only a handful of market-rate developers are breaking ground in San Jose, which is insufficient for a city of its size and growth potential. Josh believes there should be a dozen major projects per district, especially in a city where 90% of the land is single-family homes.
Construction costs have stabilized post-COVID, and Urban Catalyst is pushing the envelope with eight-story buildings that maximize density. Unlike many developers who use multiple floors for parking and limit residential units, Urban Catalyst uses automated parking on the first floor only, freeing up the remaining seven floors entirely for residential units. This approach allows the city to reach up to 350 units per acre, compared to the more typical 250 units per acre or less achieved by conventional methods with three floors of parking or 4-6 story buildings.
Opportunities for Policy Adjustments
Josh highlighted several policy areas that could support development and investor confidence:
- Fee Structures: Certain fees are charged per unit rather than per square footage, which may not align with actual impact.
- Fee Deferrals: Delaying fees until certificate of occupancy would match costs with actual impact.
- Property Taxes: Representing nearly half of operating expenses, property taxes are a key factor in return-on-cost calculations that influence investment decisions.
- Lessons from Other States: Programs in Washington, for example, have spurred hundreds of projects, delivering tens of thousands of new housing units.
Building for the Future
Josh also emphasized the intersection of housing and workforce. As AI and tech companies expand locally, market-rate development is critical to house tech workers and keep older class B and C apartments naturally affordable for other residents.
San Jose is at a pivotal moment. The choices the City Council makes now will have lasting effects on housing availability, affordability, and investor confidence. Supporting diverse housing types, innovative building strategies, and smart policy incentives are key to a thriving, resilient city.
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