21 Aug 2014
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Developer Fears Loss of Netflix

A Superior Court environmental review ruling this week on the Internet streaming media giant's future location in Los Gatos could mean either it stays or goes, developer says.

Developer Fears Loss of Netflix

The developer of the ambitious Netflix project at Winchester Boulevard and Albright Way says he's confident a judge will rule in his and the town's favor and not require an environmental impact report on the plan.

John R. Shenk, owner of the Palo Alto-based Adamas Ventures, LLC; said a negative declaration of environmental impacts issued for the 20-year project followed the California Environmental Quality Act and received appropriate level of scrutiny.

"It [environmental review] was exhaustive and complete and between the town and ourselves we followed all the rules and established processes," Shenk said.

The petition challenges Shenk's and Los Gatos government's assertion that the development would not have an adverse impact on the environment.

After settlement talks failed between the parties,

The project would eventually demolish five existing buildings on the 21-acre property known as the Los Gatos Business Park.

During its first phase, it hopes to build a

The large global asset management real estate firm The Carlyle Group, headquartered in Washington, D.C., owns Los Gatos Business Park, LLC.

The experienced developer said the tallest building, at 85 feet high, is the only opportunity for Netflix to grow in Los Gatos, if it stays.

If there's a ruling in the Citizens' favor, Shenk said he didn't know if it would be appealed and noted there are many ways for the judge's order to come down.

In terms of costs related to the lawsuit, if the town and the developer are required to conduct the EIR and pay for legal fees, the project entitlement indemnifies the community and requires Shenk to reimburse for all costs associated with the legal challenge, Shenk explained.

If no EIR is required and the negative declaration is accepted, Shenk said it would be a matter of months before demolition would begin at the property, razing some of the buildings to make room for the project's first part to be constructed. "Those plans are ready for submittal," he said.

A building permit application is also ready to go after a meeting with town officials a few weeks ago, he said. "Once we are ready to move forward and the judge allows us to, we'll move quickly to respond to Netflix's timing desires."

But if the Citizens appeal, the deal could be further delayed.

There's also not a definitive lease from Netflix because the developer has to be able to tell the company when it could deliver the future building, Shenk added.

Citizens' critics, who declined to be identified, say the petitioners just want to stop the project and are using CEQA to do that.

"At the end of the day, , by forcing the delays, they could," said a member of the group We Support Los Gatos, which came together to respond to the Citizens' allegations.

Killing the Netflix project will have an adverse effect on the town and its schools, which desperately need the millions of dollars a year the company generates in sales tax revenue, they said.

We Support Los Gatos members also say while CEQA is a well intended law, in the hands of someone who wants to use it to achieve a political agenda, it's easy to do.

The Citizens contend the project would create adverse environmental impacts, the biggest one being traffic, which would increase by 25 percent or about 3,000 new car trips, about 400 of those during peak commute morning and afternoon time.

The Citizens' attorney, Rachel Mansfield-Howlett, said CEQA is a citizen-enforced statute. "It's the only way that CEQA enforcement happens," she said.

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