HAYWARD — A plan to build retail spaces and luxury rental apartment towers at the long-vacant Mervyn’s headquarters site in downtown Hayward is one step closer to advancing after city planning commissioners gave it their stamp of approval.

The 6-1 decision at the commission’s Feb. 23 meeting paves the way for the City Council to consider the development proposal from Dollinger Properties, of Redwood City.

Dollinger wants to build 476 market-rate apartments and 80,500 square feet of commercial space on a nearly 11.5-acre site along Hazel Avenue, City Center Drive and Foothill Boulevard on the northern edge of downtown.

The council will take up the proposal at its April 25 meeting next month because Hayward resident Desirae Schmidt appealed the Planning Commission’s decision.

“I think the project itself is very good, and I think that it does paint the city in a whole different light as you come in and see this beautiful project,” Planning Commissioner Mariellen Faria said at the board’s meeting.

Under current plans, a 330,000-square-foot, four-story office building and 5,300-square-foot retail building on the property would be demolished to make way for two 6-story residential towers: one along City Center Drive, with 267 apartments on five floors above ground-floor commercial retail and parking spaces, and one on Hazel Avenue, with a two-story, 284-stall parking garage and 209 apartments on four floors.

Apartments in the development, called Lincoln Landing, would range in size from 590-square-foot studios to 1,350-square-foot, three-bedroom units, with monthly rents averaging about $2,500.

The two towers would be joined in the middle by large commercial spaces set back from Foothill by a 221-stall surface parking lot.

An existing four-story, 579-stall parking garage on City Center Drive, next to one of the proposed towers, would be renovated and incorporated into the project.

Other features include six courtyards, totaling about 44,000 square feet, for Lincoln Landing residents; a 7,000-square-foot public park on Hazel Avenue next to San Lorenzo Creek; and a 1,200-foot-long pathway along San Lorenzo Creek between Hazel Avenue and City Center Drive that will accommodate pedestrians and bicyclists.

Planning Commissioner Al Parso-York cast the lone vote against the project, saying that street parking should be added on Foothill to accommodate vehicles of new residents and businesses. An additional crosswalk also should be installed on Foothill between the Hazel Avenue and City Center Drive intersections, he added.

The project’s proposed parking areas should be more than adequate to handle additional vehicles, said Fred Kelley, Hayward transportation manager. A crosswalk with a signal could create traffic delays on Foothill and through downtown Hayward, prompting more drivers to cut through neighborhood streets, he said.

A pedestrian bridge across Foothill could cost at least $1 million to construct and face likely maintenance and safety issues.

“I’m sorry, but I think a kid’s life is worth more than traffic congestion, especially since traffic congestion is going to get worse regardless,” Parso-York said at the meeting.

“As we grow, we’re not building any new roads; I think that’s a huge problem, and we need to look at safety. We can’t just keep telling people, ‘Get out of your car and walk,’ and then make it so dangerous, unpleasant and difficult that nobody wants to walk,” he said.

The Lincoln Landing property initially housed a Capwell’s department store and showroom and later the Mervyn’s department store chain headquarters. It has sat vacant since 2008, when Mervyn’s filed for bankruptcy, liquidated its assets and shuttered its Hayward headquarters. In the years since, it has become a roosting spot for homeless people.

From January 2015 to November 2016, police responded to 274 calls for service, while the fire department reported 22 incidents, including security checks, trespassing and emergency medical services calls, according to a city staff report.

Kathleen Pelton, who has lived in downtown Hayward for 28 years, said she is “tired of the poor judgment the city of Hayward has shown regarding getting rid of the eyesore and homeless encampment of the abandoned Mervyn’s building.”

She recalled the 2014 City Council decision to reject a previous plan by Danville-based developer Integral Communities to build 194 townhouses and 16,800 square feet of retail space on the Mervyn’s site.

“Please try to get something done, because this is on Foothill Boulevard, the ‘gateway’ to Hayward,” Pelton wrote in a Feb. 17 email to planning commissioners.

“It is an embarrassment to the city of Hayward, as well as a health hazard and dangerous attraction to the homeless population,” she said.

Planning Commissioner Julius Willis Jr. agreed, saying that imposing “additional conditions on the developer would burden the thing too much.”

“We’ve seen developers come in before and get turned down, so we’re waiting and waiting, and hoping for something good,” Willis said.

“Hayward’s beginning to get known as a place where it’s hard to do business, so we don’t want this image to take place. Growth is going to happen whether we like it or not,” he said.

Contact Darin Moriki at 510-293-2480 or follow him at Twitter.com/darinmoriki.