The Goleta City Council Tuesday upheld an appeal for a residential project in western Goleta, a move that could possibly force the developer back to the drawing board.

The council voted unanimously to uphold an appeal filed by local resident Richard Foster against the multiunit residential project called Citrus Village, proposed for a .95-acre rectangular lot off Calle Real in the El Encanto Heights neighborhood. In doing so, the council did not deny the project outright, but called for a redesign of the project to include fewer units, and thus less bulk.

Citrus Village is a 12-unit condominium project at 7388 Calle Real. It was approved 3-2 by the Goleta Planning Commission last March. The project comprises three buildings housing two-and three-bedroom Craftsman-style units, with private open space for each unit. Two units would be designated affordable housing, while the remaining 10 would sell at the market rate.

The 12-unit design is the latest in a design series by local developer and architect Detlev Peikert, whose firm previously designed a nine-unit project, which morphed into the 12-unit project late last year at the behest of the Goleta Planning Commission. Before the nine-unit project, plans for the site specified 11 units, all market-rate, and before the 11-unit project, when the city was still unincorporated, county plans pushed for a 16-unit all-affordable housing project.

Housing advocated have supported the project because of the options it offers home buyers.

“These are exactly the type of projects we need in our community,” said Debbie Cox Bultan, executive director of the Coastal Housing Coalition. Most of the El Encanto Heights neighborhood is composed of single family tract homes.

Citrus Village would have been the area’s first three-story residential project, a prospect that alarmed some neighbors concerned about the size, scale and density of the project.

“This is like a size 10 trying to fit into a size 6,” said Foster, referring to the modifications requested by the developer, who requested allowances for lot lines and setbacks in order to accommodate the 12 units while complying with parking requirements and open space rules.

Project opponents also noted that the vertical shape of the project was not cohesive with the Americans with Disabilities Act, as the design required access via stairs.

Among the topics the council also discussed were inclusionary rates — a percentage of affordable units required by the city for housing projects — vs. state density bonuses, whereby the developer is entitled to concessions based on the amount of affordable units included in the design. Goleta has no ordinance covering the state density bonus law.

During this week’s go-round, concerns the council had with height and density — put forth by Councilmembers Margaret Connell and Ed Easton, as well as Mayor Roger Aceves — seemingly overrode Councilman Eric Onnen’s support of the project.

According to Goleta Planning and Environmental Services Director Steve Chase, the General Plan calls for 12.3 units per acre on this site, which is considered a transition site between the residential project to the north, and the commercial project to the east.

For the developer, the upholding of the appeal is another hurdle. The project has already been five years in the planning and design stages, and the financial outlook is already grim.

“This project is already upside down,” said Peikert, calculating the $5.98 million in costs to design and build the project versus the projected $4.5 million he expected to gain from it.

“That means it’s going to take some time to bring this project to market,” Peikert told the council. One of his plans for Citrus Village was to somehow partner with local employers trying to retain their workers in order to fund the development.

According to City Attorney Tim Giles, Peikert has the option to recast his plans into the nine-unit project requested by the council, at which point the plans would go back to council for further review.

— Noozhawk staff writer Sonia Fernandez can be reached at sfernandez@noozhawk.com.