Just weeks after Palo Alto officials adopted a law that creates a menu of zoning perks that developers of affordable housing can request, the new policy is being put to the test.
A development proposed for 441 Page Mill Road, between El Camino Real and the Oregon Expressway underpass, would replace four existing single-family homes with a three-story mixed-use development. The building would be 40 feet high and include retail use on the ground floor, offices on the second floor and 10 apartments on the third, three of which would be sold at below market rate.
By offering three units of affordable housing, the project -- by local architecture firm Stoecker and Northway on behalf of Norm Schwab -- has become a test case for the city's "density bonus ordinance," which the council adopted on Jan. 13. The ordinance offers zoning perks in exchange for construction of affordable housing.
The ordinance creates a menu of specific zoning concessions the developer can request and automatically receive without further council review. A developer who wants concessions that are not on the menu is now required to provide the city with a financial analysis showing why these exceptions are necessary.
However, the project was pitched before this menu existed, and the concessions it is requesting are "off-menu items," which means the developer has to go through the more extensive process of providing financial data. Senior City Planner Russ Reich told the Weekly the applicant has submitted the pro forma, and the city is seeking a consultant who would help staff analyze the numbers.
"They have submitted a pro forma very recently," Reich said. "What the council adopted (in terms of concessions) was not what was in the draft of their proposal. They kind of have to take a step back and provide that pro forma to explain why they requested these concessions."
The proposed 35,000-square-foot development was scheduled to undergo a review in front of the Planning and Transportation Commission this week. But because of the extra step, staff is recommending moving the hearing to a different date so that it has time to consider the concessions.
In this case, the developer is seeking permission for added density (1,513 square feet more than would be allowed under the concession in the city's new menu). Another request is to devote more of the development than would otherwise be allowed to commercial use. While normally, this use would be restricted to about 10,770 square feet, Schwab is proposing to have more than 21,541 square feet.
In the past, the applicant would probably have little trouble getting these concessions. State law entitles developers of affordable housing to seek exemptions from the city and gives local jurisdictions little leeway to deny these requests. City Planning Director Hillary Gitelman noted at the Jan. 13 meeting that without a local ordinance, "The field is wide open for people to request whatever concessions they think of" and the city has a limited ability to say no.
By instituting the menu earlier this month, the council was hoping to steer applicants toward those concessions deemed to be least harmful to the community. The menu includes such concessions as an increase in height limit and a decrease in side-yard requirements, provided the new development is not adjacent to a low-density residential zone. The project proposed by Stoecker and Northway, on a block that also includes the Kelly-Moore Paint Store and the AT&T store but backed by homes, is adjacent to such a zone.
Reich said the review of the pro forma will likely take about a month. The project is now expected to get its review in front of the planning commission in late February, he said.
"This is the first one and we don't have a consultant lined up to do that kind of work," Reich said. "We're looking to find a firm that can do that level of review."
Compared to other recent developments proposed (and, in one case, approved) for this neighborhood, the Schwab project is in many ways a modest proposal. For the past two years, Palo Alto officials have been debating an ambitious "planned community" application submitted by developer Jay Paul Company that would have added two office buildings totaling 311,000-square-foot of commercial space to a nearby site at 395 Page Mill Road, a debate that came to an abrupt end last December when Jay Paul withdrew the application, citing the city's "political climate."
The only other "planned community" proposal currently on the table in Palo Alto is for a four-story commercial building at the corner of El Camino Real and Page Mill, on a parking lot that was formerly owned by the Santa Clara Valley Transportation Authority and stands less than a block from the Stoecker and Northway proposal.
One block south of the VTA lot is the site of 3159 El Camino Real, a 74,122-square foot mixed-use project that the council approved in November that would include retail, offices and 48 small apartments, built around Equinox gym.
The building proposed by Stoecker and Northway would be less than half the size of the 3159 El Camino. And much like that approved development, the proposed one would be consistent with the underlying zoning -- a key point at a time when "planned community" proposals (which can dramatically exceed zoning regulations in exchange for negotiated "public benefits" that the developer negotiates with the council on an ad hoc basis) continue to stoke community rage.