San Juan Capistrano residents are raising concerns about an approved BMW dealership that is slated to be built alongside 95 new single-family homes on a vacant property that has sat undeveloped near Valle Road.
The city council voted 4-1 during a meeting last month to approve the Distrito La Novia project. Councilmember Sergio Farias voted no.
Many residents opposed the project during the Oct. 20 meeting, voicing concerns about traffic, safety, noise and the aesthetic of the surrounding area.
“Look at what makes our community unique. Historically, this area is a semi-rural haven,” said Terence Dougherty, a San Juan Capistrano resident who spoke against the dealership during the city council meeting.
“Forcing an industrial zoning designation into the heart of this neighborhood completely shatters that identity,” Dougherty added.
According to the city staff’s presentation, the proposed Distrito La Novia project would replace a previously-approved retail, office and residential development with a BMW dealership and new housing on 18.7 acres east of Valle Road — between San Juan Creek and La Novia Avenue.
Development plans for the property date back decades, but the latest proposal has divided residents over whether a large auto dealership belongs in the area.
“I appreciate the arguments against it,” Councilmember Howard Hart said during the meeting. “We’ve grown so used to seeing that corner empty, and to put an auto dealership there is a big change to the character.”
Supporters said the property could bring new homes, jobs and tax revenue to the city.
Emilie Simard — director of Forward Planning for Shea Homes — presented the project to the city council on behalf of Shea Homes and BMW representatives Roger Penske Jr. and Pat Bolter.
Simard’s presentation highlighted the proposal’s potential economic benefits, including an estimated $2 million in annual BMW tax revenue, a $1.2 million contribution to the city for affordable housing and an estimated $3.8 million in one-time city fees and revenues.
“Beyond the land use compatibility this project also represents a significant long-term investment in San Juan Capistrano,” Simard said during the meeting on Oct. 20.
Some residents emphasized that the proposal could provide significant tax revenue.
“It’s going to create jobs — it’s going to create not only revenue for the city but for all the businesses in the city, and I think that’s a positive thing,” said Ron Joy, a resident who spoke in favor of the project.
Traffic and safety were among the most common concerns expressed during the meeting, particularly over plans for vehicles entering and leaving the dealership through a right-turn-only configuration on Valle Road.
Councilmember Troy Bourne argued that rejecting the dealership would not necessarily leave the property undeveloped, emphasizing that a different development could have greater impacts.
“It’s not this or no build, it’s this or something that has more square footage, more traffic and fewer good jobs,” Bourne said. “That’s the alternative that we’re looking at tonight.”
City staff and the project’s developers, however, pointed to traffic and environmental studies that found the proposed development would have fewer impacts than the previous project already approved for the site.
A separate noise study also found that the project would not exceed city noise standards.
Councilmember Farias, who cast the lone dissenting vote, said he opposed the project because it would reduce the amount of housing planned for the site.
“That’s my issue with this project: losing the housing,” Farias said. “If I had my say here, it would just be all housing — it would probably be very dense housing.”
The city council’s decision followed a 4-1 vote by the city’s planning commission in September to recommend approval of the project. Commissioner Darren Fancher voted no at that meeting.
The proposal drew significant public interest at the earlier meeting, where about 60 residents attended the planning commission hearing on Sept. 23. All available seats were filled, with some residents forced to stand in an overflow area.
Residents Question Affordable Housing Numbers
While the BMW dealership was a major concern for many, some residents also questioned whether the proposal would help address San Juan Capistrano’s need for affordable housing.
The project would include 95 for-sale homes, but none would be designated as affordable housing.
Instead, Shea Homes would contribute about $1.2 million in affordable housing in-lieu fees — payments made instead of building affordable units — that could be used to help build affordable housing elsewhere in the city.
For some residents, the lack of affordable homes was a major concern.
“While the Distrito La Novia project counts towards the city’s housing requirements overall, it’s become a private commercial and housing development — no longer affordable housing,” said 32-year resident Betty White, “which is disappointing to many of us — those of us who would like to know that our children could continue to live here.”
City officials said the in-lieu fees would allow the city direct money toward affordable housing projects in locations better suited for them.
Development Services Director Joel Rojas said affordable housing is often best located near services, public transportation and downtown areas — he argued that the Distrito La Novia project site does not meet those criteria.
He also noted that the city has already used $3.2 million in collected in-lieu fees to purchase another site for an affordable housing development and is slated to spend another $4.7 million to help construct the project.
“We just think it makes more sense to collect that money and to contribute to an affordable housing development somewhere else in the city,” Rojas said.
Meeting State Housing Goals
City leaders are reviewing the plans as communities across California work to meet state housing requirements.
Under the state’s Regional Housing Needs Allocation (RHNA), San Juan Capistrano must plan for 1,054 new housing units during the current housing cycle, which ends in 2029.
The requirements are outlined in the city’s Housing Element planning document and include 270 very low-income units, 173 low-income units, 183 moderate-income units and 428 above moderate-income units.
State guidelines define “low-income” households as earning up to 80% of the area median income and “very low-income” households as earning up to 50%, according to the California Department of Housing and Community Development.
In Orange County, a family of four qualifies as low income with earnings less than $138,600 a year and as very low income with earnings less than $93,050.
Housing concerns were part of a broader debate over whether the benefits of the project outweighed concerns about the dealership and its impact on the community.
Joanna Jenner — whose family has lived in San Juan Capistrano for 30 years — opposed the BMW facility during the city council meeting. She said the project could change the character of the community that attracted residents in the first place.
“We’re all very concerned about what our lifestyle is going to look like in the next year.”
The Collegiate News Service is a partnership between Voice of OC and local student journalists. Contact the Collegiate News Service Editor Angelina Hicks at ahicks@voiceofoc.org
