The Los Gatos Town Council will consider a new proposal Tuesday to build 294 condominiums and apartments, a hotel, a town square and retail stores as part of the North 40 development.

Developer Grosvenor Americas is seeking to build on just over 15 of the remaining 20 acres that can be developed.

The first phase of the North 40 development will see 320 homes built, and more than 66,000-square-feet of commercial and retail development on about 20 acres, and work could start this fall, said Grosvenor Senior Vice President for Development Steve Buster.

What will be built in the second phase has yet to be decided.

But Buster described the latest proposal as a “very high level concept.” His comment came at an Aug. 2 community meeting that was sponsored by the non-partisan Democracy Tent citizens’ group.

The Phase 2 concept calls for half of the proposed 294 homes to be sized for millennials at about 900-square-feet. The other half would be targeted at downsizing seniors and would be about 1,500-square-feet.

A representative of the Town Not City citizens’ group, Rod Teague, suggested the senior homes be “buyer-restricted” to people over 55 to avoid having “a bunch of young families” move in.

“There’s a strong need for the 55 demographic in town,” Teague said. “I was trying to find a place in Los Gatos for my parents and there was nothing available. They had to move to San Jose.”

Conversely, resident Michael Smith noted that “a lot of young families would like to come to Los Gatos because of the good schools, but can’t afford it.”

Another problem, Smith said, is that sometimes families that already live in Los Gatos can’t stay because they can’t afford bigger homes for bigger kids.

The Democracy Tent held the community meeting to educate residents about what may be coming in Phase 2.

“What we’re hoping to do is to make Phase 2 a little less contentious (than Phase 1) and be more collaborative,” Democracy Tent member Lee Fagot said.

Buster repeatedly expressed a willingness to work with the community and said Phase 2 is “going to look like what you guys want it to look like.”

He went on to say that the Phase 2 housing was proposed as an alternative to “a big retail and entertainment” complex because residents don’t want the North 40 to compete with downtown Los Gatos businesses.

“We heard that,” Buster said.

He said the developer also heard residents’ concerns about traffic and pointed to a study that showed housing would generate 19 percent less traffic than retail and entertainment uses.

But there’s a caveat: To make the housing and hotel goals financially pencil out, Los Gatos would need to agree to raise the town’s maximum 35-foot height limit to 55 feet, Buster said.

The town council is already considering allowing a hotel to go to 45 feet.

More height would also free up more land for additional open space, perhaps even a multi-purpose field or community garden, Buster said.

But that may not satisfy open space proponents.

“I see huge amounts of cement,” resident Mary Roach said. “This is a huge cement slab. Where is it for somebody to go outside for a breath of air? Greenery gives us oxygen.”

Buster replied, “We could figure out a way to make a big park by combining open spaces.”

So, at this point the Phase 2 concept is flexible. It will be discussed in-depth, with time for public comment, during the Aug. 7 Los Gatos Town Council meeting that starts at 7 p.m. at 110 E. Main St.