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Phase 3 encompasses the two industrial areas of North Fair Oaks: the area north of Fair Oaks Avenue and west of 2nd Avenue, and the area between Edison Way and the Southern Pacific Railroad tracks, between 5th and 12th Avenues. The majority of these areas currently consist of industrial uses, with some office and commercial uses.

The Community Plan designates these rezoning areas as Industrial Mixed-Use, with the goal of continuing and expanding industrial uses, while also allowing some commercial, public, and institutional uses. Within the Spring Street Industrial Mixed-Use area, the focus is on preserving existing industrial uses, while allowing limited commercial uses, mainly fronting Bay Street. For the Edison Way corridor, a mix of uses is encouraged, including industrial, commercial, and live-work residential.

Planning staff is currently working on Phase 3 rezoning, which is scheduled to be completed in 2019.