CP&DR News Briefs March 17, 2026: Caltrain Yard; Yucaipa Warehouses; Plan Bay Area; and more

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Prologis Eyes Major Development for S.F. Caltrain Yard A developer plans to transform the 20-acre Caltrain rail yard at Fourth and King streets in San Francisco into a dense new neighborhood with thousands of homes and several high-rise towers. The proposal is led by Prologis, best known for renting warehouses to Amazon, and could include up to 2,500 housing units and roughly 4 million square feet of commercial space, with total development reaching about 8 million square feet. The first phase of the project includes a pair of high-rise twoers. The project could take up to 20 years to complete, with Prologis leading master planning and Caltrain managing upgrades to rail infrastructure. A version of the project has been envisioned for a least ten years. It was then that The Portal, an as-yet undeveloped project that will extend Caltrain service to the Transbay Terminal. (See related CP&DR coverage.)

Yucapia Reverses Course on Warehouse Approval

The Yucaipa City Council voted unanimously to rescind its earlier approval of an update to the Freeway Corridor Specific Plan, effectively halting a proposed warehouse and logistics project. The reversal also cancels a previously scheduled June 2026 referendum election, which had been triggered after residents gathered thousands of signatures to challenge the project. The controversy centers on a 2-million-square-foot distribution warehouse complex planned in Live Oak Canyon along Interstate 10 called Pacific Oaks Commerce Center. City leaders had originally approved the project in 2025 as part of broader zoning changes for a 1,242-acre corridor along the freeway, arguing it would generate tax revenue, jobs, and infrastructure investment. Residents were opposed to the project because of concerns about diesel truck traffic, air pollution, noise, and the loss of the area’s character. (See related CP&DR coverage.)

Draft of Bay Area Regional Plan Released

The Metropolitan Transportation Commission (MTC) and the Association of Bay Area Governments (ABAG) released the proposed final version of Plan Bay Area 2050+ and Transit 2050+, a regional blueprint guiding growth, transportation, and housing across the Bay Area nine counties through 2050. The plan was developed over nearly three years of technical analysis, public engagement, and revisions, including a 59-day public comment period on the draft plan that ended in December 2025. Plan Bay Area 2050+ outlines policy and funding strategies intended to address rising costs, widening inequality, and persistent housing shortages. It integrates land-use planning with transportation investments, emphasizing development near transit and improvements to transit, biking, and walking networks.

Sinking Land Jeopardizes California Water Supply

Satellite data from the California Department of Water Resources show that parts of California have sunk dramatically over the past decade, the most extreme cases in sections of the Tulare Basin in the San Joaquin Valley, where certain areas dropped more than seven feet between 2015 and 2025. Agricultural groundwater pumping has been blamed as the major cause of subsidence, according to Paul Gosselin, deputy director for sustainable water management for the California Department of Water Resources. The sinking occurs when excessive groundwater extraction causes underground aquifers — especially clay layers — to compact irreversibly. Long-term impacts threaten infrastructure such as levees and canals and could reduce State Water Project deliveries by as much as 87% by 2043, according to the California Department of Water Resources.

CP&DR Coverage: Benicia Properly Used SB 35 For Projects In Historic Arsenal District

A challenge to two SB 35 projects in Benicia by a local preservation group – arguing, among other things, that the projects involved historic structures and wetlands – has been struck down by the First District Court of Appeal. The ruling is unpublished and therefore cannot be used as precedent. At issue were two projects located on the former U.S. Benicia Arsenal, which is now the Benicia Arsenal Historic District, which is located on both the National Register of Historic Places and designated as a California state historical landmark. The City of Benicia approved both projects under SB 35,. 1000 Friends Protecting Historic Benicia attempted unsuccessfully to appeal to the Benicia City Council the city’s ruling that that the projects are exempt from the California Environmental Quality Act under SB 35. 100 Friends then sued, claiming the projects did not qualify for SB 35. In the unpublished ruling, the appellate court shot down all of 1000 Friends arguments.

Quick Hits & Updates

A new UCLA study finds that across 17 U.S. cities, the average cost to construct a parking space is about $52,000 aboveground and $73,000 underground, not including land costs. The study estimates that required parking can add  $50,000–$100,000 per apartment unit, making housing projects more expensive and especially discouraging smaller, more affordable units. Researchers found parking construction costs have risen about 50% faster than inflation since 2012, meaning mandates increasingly account for a large share of project budgets.

A study by the Lincoln Institute of Land Policy recommends six strategies for integrating equity into climate and housing planning in North American cities. The report recommends securing and expanding local climate action funding, championing resilient affordable housing solutions, supporting community-led green infrastructure projects, restructuring municipal planning to better integrate sustainability, adopting phased implementation strategies to better track results, and fostering community engagement. 

City of Industry officials and the owner of the Puente Hills Mall are exploring the possibility of redeveloping the site into a data center. The mall’s owner, Real Estate Development Associates, submitted a project description to the city in January outlining two development scenarios. One option would build up to 1.6 million square feet of logistics warehouses, while another would include about 813,540 square feet of industrial space plus up to 450,000 square feet of retail or commercial uses.

The Marin County Board of Supervisors approved a $55.4 million development agreement to redevelop former United States Coast Guard housing in Point Reyes Station into affordable rental housing, with funding expected from local housing funds, state farmworker housing grants, and low-income housing tax credits. The project will renovate 36 existing townhomes and a 24-room barracks building, creating about 54 units for extremely low income and low income households.

San Francisco Mayor Daniel Lurie and Supervisor Bilal Mahmood introduced legislation that would cut the city’s transfer tax in half on large real estate transactions, in order to encourage construction of approved but financially stalled projects. The transfer tax would decrease from 5.75% to 2.75% for transactions of at least $10 million and from 6% to 3% for deals of at least $25 million, reversing former Supervisor Dean Preston’s 2020 ballot measure. The tax decreases will be able to be legislated instead of voted on due to a 2024 proposition that allows transfer taxes to be decreased without returning to the ballot. In its place, Lurie and Mahmood introduced a ballot measure to eliminate the tax exemption for foreclosures.

A report on Lithium Valley in Imperial County finds that developing a lithium extraction and battery manufacturing hub could significantly transform the local economy, which currently faces high poverty and unemployment. The report, by Comité Cívico del Valle and Earthworks, examined the Hell’s Kitchen lithium extraction project proposed by Controlled Thermal Resources near the Salton Sea and a legal challenge under CEQA over the project’s approved EIR. It contrasts a “high road” approach, creating well-paid jobs with career pathways, strong labor protections, and local hiring, with a “low road” model that extracts resources without meaningful community benefits. (See related CP&DR coverage.)

Governor Gavin Newsom signed legislation authorizing a $590 million emergency loan to support the Bay Area transit agencies BART, Muni, Caltrain, and AC Transit. The loan will be issued through the Metropolitan Transportation Commission (MTC) and distributed to help maintain service. These agencies are facing severe financial deficits of over $800 million projected for the 2026–27 fiscal year, largely due to reduced ridership following the COVID-19 pandemic. The funding is intended as a temporary bridge to prevent major service cuts while the region works on a long-term solution.

A UC Berkeley study highlights 40 potential policy actions that support construction innovation, particularly industrialized construction such as prefabrication and factory‑built housing to boost housing production. The suggestions seek to address existing risk and liability and provide a framework for legislative action.

The Peninsula Open Space Trust purchased the 1,921-acre Mead Ranch between San Jose and Morgan Hill for $24.3 million to preserve it as open space and wildlife habitat. The property, previously owned by the Bechtel family, will help connect ecosystems between Coyote Valley and the Santa Cruz Mountains.

A Santa Cruz County judge ruled that Watsonville violated state aviation and environmental laws when it approved a 21-unit housing project near Watsonville Municipal Airport in 2021. The court sided with the Watsonville Pilots Association, finding the city failed to adopt required airport safety standards in its general plan and relied on an inadequate environmental review that did not properly analyze aircraft noise and safety risks.

A report from the California YIMBY Education Fund argues that the City of Los Angeles’s current land-use planning and housing entitlement process is overly discretionary, opaque, and vulnerable to political pressures, which contributes to high housing costs and corruption. The report argues that Los Angeles should make more application types eligible for ministerial approval by reforming site plan review procedures and increasing allowable density, and suggests several strategies to improve the discretionary review process.