San Jose adds 89 interim housing units at Arena Hotel for $6.4M

San Jose
City Council Meeting
April 14, 2026

TL;DR

• The council signed off on up to $6,408,000 for the Arena Hotel to run as interim housing, with up to 89 units coming online May 1.
• A 195-unit affordable building at 1565 Mabury Road got cleared for up to $82,584,672 in bond financing.
• The council backed VTA's draft spending split for a potential November transit measure: 20% pavement, 30% transit capital, 50% service and rider experience.
• An $18.9 million contract launches the largest capital project in the wastewater plant's history, a roughly $240 million overhaul to meet new Bay discharge limits.

What happened

1. Arena Hotel will run as interim housing starting May 1, with up to 89 units
   1. The council signed off on up to $6,408,000 for the Santa Clara County Housing Authority to operate the Arena Hotel as interim housing for residents with project-based Section 8 vouchers. The initial 14-month term runs through June 2027 at $2,314,000, with two extension options carrying the agreement through May 2029. The vote was 8-0. Mayor Mahan, Councilmember Mulcahy, and Councilmember Candelas were absent.
   2. What this means for you: This is the second site in San Jose using this model. At the Pacific Motor Inn, tenants stay about six months on average before moving into permanent housing. The Housing Department said the vouchers funding Arena Hotel come from a separate pool and do not reduce the project-based vouchers used to build new permanent affordable units. Arena Hotel is in District 6.
2. Bond financing cleared for 195 affordable apartments at Berryessa BART
   1. The council authorized up to $82,584,672 in tax-exempt multifamily housing revenue bonds for Berryessa TOD, a 195-unit affordable building at 1565 Mabury Road next to the Berryessa BART station. The vote was 8-0.
   2. What this means for you: The bond money goes to Berryessa Affordable Housing, L.P. to finance construction. The council also approved a backstop provision letting rents rise to 60% of the area's median income if project-based vouchers expire or in the event of foreclosure. The project is in District 4.
3. San Jose backs a 20-30-50 split for the potential November transit measure
   1. The council adopted its advocacy position for how Santa Clara County's share of a November transit measure should be spent if voters pass it. The recommended split: at least 20% to roadway pavement on transit routes, at least 30% to transit capital projects, at least 50% to service and rider experience. The vote was 8-0.
   2. What this means for you: SB 63 created a potential regional transit measure that would need 50% plus 1 to pass. If approved, approximately $264 million a year would come to Santa Clara County through VTA starting in fiscal year 2031. The VTA Board takes its own action June 4. Council members also pressed VTA on free transit passes for youth, modeled on the Fremont Union High School District program, and on safety at transit stops. Councilmember Ortiz raised separate concerns about VTA's communication with East San Jose residents during construction of the Eastridge to BART Regional Connector, including overnight work and a lack of dust mitigation.
4. Brown and Caldwell hired to guide a roughly $240 million wastewater plant overhaul
   1. The council awarded an $18,900,000 contract to Brown and Caldwell to act as the city's advisor on the Aeration Basin Modifications Phase 1 Project at the regional wastewater facility. The contract runs through June 2034. The vote was 8-0.
   2. What this means for you: The construction project itself is projected at roughly $240 million, the largest single capital project in the wastewater plant's history. It addresses two needs: replacing aging infrastructure and meeting tougher nutrient discharge limits the Water Board has set for facilities discharging into San Francisco Bay. The advisor contract works out to about 8% of construction cost, within the industry standard of 5% to 12.5%. The plant serves both San Jose and Santa Clara.

What residents brought up

• A former foster youth from San Jose spoke in support of the Santa Clara County Housing Authority's Moving to Work plan, which the council also certified at the same meeting. He cited the plan's focus on community partnerships and direct pathways to housing for transition-age youth aging out of care, saying current waiting list approaches leave students in community college, four-year schools, and trades programs falling through the cracks.
• A representative from Glydways, the consortium selected by the city to design and build the Diridon-to-Airport automated transit network, asked the council to make innovative transit projects like the Connector eligible for funding under the regional measure. He noted the Diridon Airport Connector was among the most popular projects in 2000 Measure A voter polls.
• A District 10 resident affiliated with a neighborhood leadership group raised concerns about street paving quality and the use of Measure T funds. He said he did not think District 10 was getting its share of paving work based on citywide allocation.

Also happened

• The MCK Services contract for the 2026 Major Streets Resurfacing #1 Project was approved at $5,849,718.77 plus a $584,972 contingency, covering Districts 1, 2, 3, 4, 5, 6, and 8.
• The Guadalupe River Trail Bike Connections Plan was approved across Districts 3, 4, and 6.
• A $100,000 grant agreement with Infinera Corporation was approved to support expansion of its semiconductor manufacturing facility in District 10.
• A 4,021 square foot surplus lot on Sherlock Drive was sold to an abutting property owner for $55,000.
• The Santa Clara County Housing Authority's FY 2027 Moving to Work Annual Plan was certified as consistent with the city's Consolidated Plan, including a direct rental assistance pilot.
• Master Consultant Agreements with HDR Engineering and CDM Smith for wastewater facility construction management were extended through June 2028.

For any updates or corrections, please email steven@polisdesk.com