Council approves Kingsbarn’s 128‑unit downtown project despite business concerns over parking

The Escondido City Council on Thursday approved a development package allowing Kingsbarn Realty to build a 128‑unit market‑rate apartment project on a downtown public parking lot, awarding the applicant density transfers and related entitlements amid intense public comment about loss of public parking and lack of affordable units.

Ivan Flores, principal planner, told the council the project site at 137 West Valley Parkway is about 1.04 acres and would use a downtown density transfer to increase the site’s base density from roughly 78 units to 128 units. The applicant requested plan amendments to permit ground‑floor residential uses and a slight height increase; staff said the building’s ultimate height would be approximately 61 feet. Planning staff reported the applicant would provide about 113–115 parking stalls in a below‑grade/ground‑floor garage and pay in‑lieu fees (staff cited roughly $109,000) and a climate‑action fee (~$34,450 for downtown tree plantings).

Developer David Ferguson and Phil Mater of Kingsbarn argued the project is financially viable because of a pre‑2020 surplus‑lands exemption and the site’s opportunity‑zone status; the developer described a long‑term ownership model that holds assets for 10 years to take advantage of federal tax incentives. "When I got to Escondido ... we wanted to support the businesses ... and to get more customers to come downtown, we needed more shops and restaurants," Ferguson said, arguing the project will bring "approximately 200 plus people" who would patronize local businesses.

Opponents—local business owners and patrons—said the city would be losing a heavily used public parking lot and that the alternative parking proposed by staff/developer is too distant or unsafe for customers and seniors. "This parking lot is absolutely vital to our local businesses," said a representative of Felipe’s Pizza Grotto, which submitted a petition with roughly 120 signatures opposing the lot sale. The Escondido Downtown Business Association provided a formal statement backing the project as aligned with the Grand Avenue vision, while other speakers raised concerns about transparency and prior negotiations.

Council members split on policy grounds. Supporters cited the city’s RHNA obligations, the need to attract residents and discretionary spending downtown, and legal limits on imposing minimum parking near transit (staff and developer cited state law restricting local parking requirements when a project is within a half‑mile of transit). Dissenters argued the project includes no affordable units and that selling a public asset should yield a stronger demonstrable public benefit.

The council approved the entitlements and associated ordinance/resolution (staff had identified ordinance 2026‑02 and resolution 2026‑12 in the staff report). The clerk noted the motion passed with one no vote (Castro Martinez). City staff and the city attorney also confirmed the sale proceeds (the transcript identifies a sale price discussed during Q&A) would be reinvested in the vehicle parking district consistent with the 1943 vehicle parking district act.

Next steps: staff will finalize conditions of approval, coordinate required permits and return with any necessary follow‑up reports; the developer will work with the city and the Public Art Commission on mural and alley‑art commitments.