"Including these custom lots is critical to offsetting substantial infrastructure costs that are necessary for unlocking the affordable housing portion of the design."
That sentence comes from the Phase 2A memo Harmonie Park Development gave the Hillsborough City Council for its October 12, 2026 study session on the Tobin Clark property. It describes how the project's money moves. Most housing debates assume market-rate homes and affordable homes compete for the same land. On this hillside next to the College of San Mateo, they depend on each other. The most expensive product in the plan is the one paying for the roads, pipes and water loop. Without those, nothing else gets built.
That changes what to watch as the plan moves into its next phase. The custom-lot count has already grown once, and it is the variable the plan's finances lean on hardest.
Three products, one balance sheet
The Town owns a 50-acre site in the former Tobin Clark estate, along its southern border. Its Housing Element marks 20 acres of it for multifamily housing. The refined master plan in the October 12 agenda packet divides the buildable part of that land into three pieces:
| Component | Land | What the memo describes | Role in the plan |
|---|---|---|---|
| Townhomes | About 1.2 acres | 24 three-story homes of about 2,500 square feet, three- and four-bedroom layouts, under 35 feet tall from the street | Market-rate, for sale |
| Custom estate lots | About 6 acres | 12 half-acre lots, building pads of roughly 2,600 to over 3,000 square feet, room for a 5,000 to 6,000 square foot home plus an ADU | Market-rate, offsets infrastructure |
| Affordable building | About 1.3 acres | 50 affordable homes plus a manager's unit, 4 to 5 stories over parking, about 85 feet | Designed to compete for 9% Low-Income Housing Tax Credits |
The affordable building is aimed at households earning 30 to 60 percent of area median income. Its unit mix leans toward two- and three-bedroom homes. Tax-credit financing can pay for a building. It does not pay to grade a hillside, run water service up to it, or build a public street. Under this plan, the townhomes and the custom lots have to cover that work.
Why the ground itself is the expensive part
The memo is direct about the site. The roughly 20 acres are "largely undeveloped and topographically complex," with slopes from about 8 percent to more than 60 percent, limited buildable area, and biological constraints that call for avoidance or mitigation. No infrastructure is in place. Building there means extending utilities, improving roads and creating a looped water system.
Access has turned out to be less settled than earlier documents suggested. The Town's fact sheet described the conceptual access route as running through the College of San Mateo. Phase 1 work found that utilities would have to run inside the Tobin Clark site to reach the existing Town of Hillsborough lines serving the property, which "may modify ingress/egress routes as well."
The other cost driver is the street standard. After talks with Town staff and the Central County Fire Department, the team moved the streets from a private standard to the Town's public right-of-way standard. The new public roads and utilities now take up about 3.2 acres. The fire coordination also covered aerial access, street radii and Wildland Urban Interface requirements. Among them is a Fire Protection Plan that will be required during the application process. Wider public streets carry more pavement, more grading and more acreage that cannot be sold. All of it raises the cost the market-rate homes have to absorb.
This is also why the original concept fell apart. The Housing Element imagined podium buildings throughout. Phase 1 found that "larger market-rate multifamily buildings were not financially feasible due to construction costs, parking requirements, and market conditions." The staff report's comparison table marks two 100-home podium options as not feasible. It marks the mixed option, built around townhomes and single-family lots, as the only feasible one.
The lot count already moved once
In June, the custom lots were still a smaller line item. Harmonie Park's June 8, 2026 presentation showed a 92- to 94-home concept with 10 custom lots and potential ADUs, alongside the same 51-unit affordable building and 24 townhomes. By October, the memo had added "two additional custom lots to get closer to the targeted 50 market rate homes."
The arithmetic shows the pressure. Twenty-four townhomes and 12 lots make 36 market-rate homes, still short of the 50 the plan targets. When the plan needed more market-rate value, the team added lots, not townhomes. The memo says the lot program reflects "the prevailing development pattern of Hillsborough" and responds "directly to market analysis conducted during the due diligence process."
Land use moved too, and the published figures do not line up neatly:
- The October staff report says 30 of the Town's 50 acres are designated to stay open space.
- The June presentation described more than 12 acres of open space within the plan.
- The October memo puts the development area at over 10 acres. It leaves 10.1 acres, plus the 3.2-acre right-of-way, under Town control for open space, community spaces or other public benefits.
The first figure covers the whole 50-acre holding. The other two describe the roughly 20-acre housing site. Within that site, the October plan has about 10 acres of open space and community benefit areas, arranged around a central green. Ideas under discussion include an outdoor pavilion, play areas and a possible satellite safety station.
Another push is coming from the affordable side. The Town has asked the consultant to study whether the site can take more affordable homes, partly "to take pressure off other Housing Element properties." The memo calls the balance of the finances "very challenging to date" and expects an update by the end of 2026. The other Town-owned site in the Housing Element is the Town Hall Campus. It covers about 2.5 acres near Floribunda Avenue and El Camino Real and is planned for 16 affordable homes. Any affordable units added at Tobin Clark would need more subsidy, and in this plan the custom lots are what supply it.
Why this site carries so much weight
The Town says its Housing Element came out of two years of planning, and that "a key priority for the community was to maintain current zoning standards on all private properties." To meet its state housing allocation, the Town instead rezoned two Town-owned sites for multifamily housing. Both parcels were rezoned at the January 8, 2024 Council meeting. So the Town's planned new multifamily housing rests on two parcels, and Tobin Clark is far larger.
For someone comparing Hillsborough with Burlingame or San Mateo, that matters. Townhomes are on the drawing board here only because this one Town-owned hillside was set aside for them. The plan also creates a dozen new half-acre lots on public streets with new utilities, which Hillsborough's existing housing supply rarely offers. These would be new parcels with known pad sizes and room for an ADU. The plan says up to 12 ADUs could come with the lots.
How far away any of this is
None of these homes is close to being built. The staff report says no formal development application has been submitted. The documented sequence runs like this:
- Phase 2A wraps up at the end of October 2026. It ends with the two community meetings, October 12 and October 26.
- Phase 2B runs from November 2026 through February 2027. It covers a revised engineer's cost estimate, updated feasibility analysis, more access discussions and a draft project description.
- The Town then seeks a developer. The memo calls a formal solicitation for "a developer/partner or team of developers" the ultimate goal.
- Environmental review follows a specific proposal. MIG, which prepared the Housing Element EIR, expects a Focused EIR that would take about 12 to 24 months. The preliminary budget is about $971,750 including a 15 percent contingency, typically paid for by the developer.
The consultant's own contract is budgeted at $539,100 through March 24, 2028. The staff report says the work is on time and under budget so far. The memo also expects the revised engineer's estimate in Phase 2B to give the financial model "a more accurate foundation." If that estimate comes in higher, more market-rate value will have to cover it. Between June and October, the plan found that value by adding two custom lots.
A few questions that come up
Can anyone reserve a lot or a townhome now? No. No developer has been chosen and no application has been filed. The memo says the custom homes will be individually designed, so no architecture exists yet.
Where can I see what was presented? The October 12 agenda packet includes the staff report, the Phase 2A memo and the presentation. The Town's Public Meeting Recordings page lists the Tobin Clark study sessions by date.
Is the unit count final? No. The staff report's summary table lists 92 homes. The October memo describes 24 townhomes, 12 lots and a 51-unit building, and more affordable homes are under study.
When a new supply of half-acre lots and townhomes eventually reaches Hillsborough, it will affect how nearby homes are compared and priced. Griffith Partners follows Tobin Clark from one phase to the next, and we are glad to talk through what the plan could mean for a home you own or one you are considering. When you want a clear read on your own property, start with a free home valuation.