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Residents in the rural Olive Hill Lane area near Coombsville Road recently discovered they could be getting a new neighbor that is giving many of them pause — Pacaso.
Pacaso is the second-home co-ownership business that critics say hurts the character of neighborhoods. In this case, eight people could own the house in a community of a few dozen homes near vineyards and Mount George.
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Assertions by Pacaso that its homes' owners are good neighbors haven't prevented controversies in the city of Napa and St. Helena. This latest case involves the unincorporated county. It poses questions of if, where and how Pacaso might fit into the Napa Valley countryside.
Paul Bartelt lives on Olive Hill Lane next door to the planned Pacaso house, which is in escrow. He’s not pleased with the situation, noting each of the eight owners could stay 44 nights annually, but no more than 14 nights consecutively.
“Potentially, I’m going to see somebody new in that house every two weeks,” he said. “That’s not a neighborhood. That’s a hotel.”
The Pacaso business model involves forming a limited liability company to hold the house title and allowing people to buy shares. The company bills this as the “modern way to buy and own a second home.”
Pacaso has homes in communities ranging from Palm Springs to Cape Cod to Miami to Maui. It has 13 homes in Napa County.
“Those buyers were looking for single-family homes in the community. Instead, they share one luxury home. Pacaso retains no ownership in the home, acting solely as a property manager after sale,” Pacaso officials told the Napa Valley Register.
Pacaso owners are families, Pacaso Chief Marketing Officer Whitney Curry said. They agree to a code of conduct prohibiting large events and parties. They agree to observe quiet hours from 9 p.m. to 7 a.m.
“They want to get to know their neighbors," she said. "They want to form personal relationships.”
But several nearby residents said Pacaso is a bad fit for Olive Hill Lane.
They learned the house at 1101 Olive Hill Lane would become a Pacaso home when they saw it listed on the Pacaso website. The listing mentions a 1-acre property with a house, saltwater pool and spa, heated covered patio, sports courts and entertaining barn.
“Close to world-class wineries and iconic golf course resorts, Olive Hill is the ultimate Napa Valley retreat,” the website says.
Victor Chiarella has lived on Olive Hill Lane for 17 years. The neighborhood isn’t a resort or a neighborhood of second homes, he said.
“It’s an incredible family neighborhood,” Chiarella said. “Everybody knows one another. We have a Christmas party every year for all the neighborhood. We have a summer party every year for everyone.”
Resident Erin Renaudin said, as a mother of fairly young children, she'd like the potential for another family to move to the neighborhood. Having Pacaso come seems like getting a hotel.
She’s worried that vacationers at the house will want to have noisy fun. She’s afraid more Pacaso homes might come. She’s worried visiting drivers might not be careful when her children are riding their bikes and scooters.
“There are a lot of fears for me,” she said.
Bartelt said he’s not against time shares or fractional ownership. But they need to be done at appropriate locations. Something like Pacaso in the wrong spot — such as Olive Hill Lane — changes the neighborhood.
Several of the residents pointed to a county law designed to curb vacation home rentals. It make rentals of less than 30 days in the unincorporated area illegal. They wonder if Pacaso’s maximum stay of two weeks would run afoul of this law.
Residents on June 22 met with Supervisor Alfredo Pedroza. Bartelt said about a dozen of them attended, though others who wanted to be there were out of town. They wanted to know if the county can take some type of action.
Pedroza last week told the Napa Valley Register he is looking into the Olive Hill Lane issue.
“We want to make sure anyone who comes into our community is a good neighbor, that is adding value and contributing to the neighborhood,” he said.
In 2021, Pedroza opposed having Pacaso in the city of Napa’s Bel Aire neighborhood. He prioritizes primary residences over secondary residences. Bel Aire has homes for working-class families and has schools, he said.
Several Olive Hill Lane residents expressed concern that Pedroza last year received a $4,900 campaign contribution from Pacaso.
Part of running a campaign is raising money, Pedroza said. He has taken actions that didn’t support contributors’ wishes, he added.
Pacaso has a home near Bennett Lane in the unincorporated county near Calistoga. That is Supervisor Diane Dillon’s district and she said she hasn’t heard complaints. Unlike the Olive Hill Lane neighborhood, there are few homes nearby.
She’s concerned about Pacaso in the unincorporated county, Dillon said. There are already people who want to own large estate homes by themselves. She doesn’t want Pacaso to increase the pressure for even more home building on agricultural lands.
Dillon lives in the city of St. Helena near a Pacaso house.
“I'm not aware of any complaints about the people coming there," she said. "But the house sits empty much of the time and it has an impact on the neighborhood. We're a very family-friendly neighborhood where I live."
That neighborhood is changing without new, young families moving in, she said.
Curry said, by putting eight co-owners in one luxury home, Pacaso relieves pressure on the home market. These owners seeking second homes in Napa County might have otherwise each bought a less expensive home, she said.
Napa County doesn’t regulate fractional ownership of homes. Pacaso doesn’t need to obtain county permission to buy a home, county Planning, Building and Environmental Services Director David Morrison said.
Fractional ownership is not uncommon, he said. Examples extend beyond the newer, Pacaso business model.
“A home where a parent helps a child by co-signing for the loan. A property inherited by siblings in joint ownership. An unmarried couple who jointly own their home,” he said.
It remains to be seen what if anything the county might do about Pacaso. St. Helena, for example, determined city codes prohibiting time shares also prohibit Pacaso and then strengthened these laws. Pacaso, in response, sued the city in federal court.
“Pacaso is a concern, as it reduces the number of homes available for local families and workers and further increases housing costs,” Morrison said. “We continue to monitor the city of St. Helena’s court case as they defend their attempt to regulate Pacaso.”
The Pacaso listing for the Olive Hill Lane home puts the cost at $839,000 a share for one-eighth ownership. With a 30% down payment of $251,700, the monthly payment is $2,442, plus a monthly home expenses charge of $2,000, for a total of $4,442 a month.
Napa County Reporter
Barry Eberling covers Napa County government, transportation, the environment and general assignments. He has worked for the Napa Valley Register since fall 2014 and previously worked 27 years for the Daily Republic of Fairfield.