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Key ingredient for opening a restaurant in Palo Alto? Patience.

City streamlines process, but restaurateurs say more work is needed

In the last two years, Half Moon Bay restaurateurs Paul and Julie Shenkman have opened two restaurants at the same downtown Palo Alto site, one -- Sam's Chowder House -- with relative ease.

But the process for getting their first, Campo 185, up and running in 2012 was a frustrating experience that cost them an additional $300,000 and five months in delays, largely due to a city process lacking communication and coordination, they said.

It's a familiar story for restaurateurs looking to set up shop in Palo Alto, and one that city staff have worked to change in recent years. The city's development-services director, Peter Pirnejad, heard the Shenkmans' story after Campo opened and took it upon himself to turn the couple's experience around for their second Palo Alto project. Since he successfully did so -- and the Shenkmans have enthusiastically testified to that -- city staff has held Sam's Chowder House up as a successful before-and-after example of a years-long effort to reform Palo Alto's notoriously convoluted and time-consuming building and permitting processes.

But many restaurateurs -- veterans and first-timers alike -- still call Palo Alto an especially hard city in which to open.

Establishing a restaurant anywhere, by nature, is a trying experience. There are the par-for-the-course challenges that come in any city: demolition and construction; retrofitting to bring a space up to code; permit applications; health department inspections.

"It's very challenging to open a restaurant anywhere because of all the codes and all the different departments (involved)," Paul Shenkman said, "but I would say Palo Alto was far and away the most difficult."

He said with Campo 185 -- a farm-to-table Italian restaurant that lasted about nine months at 185 University Ave. -- there was little communication between the various city bodies involved in getting his project through the pipeline.

"If I needed a permit from department A and it depended on getting (something from) department B, you couldn't get them to talk to each other," Paul said. "It was impossible."

He said every time he would submit an application or plans to a particular department, which might then ask him to change something, he would make that change, resubmit the documents and then wait for the city's allotted three-week response requirement to pass.

"They always took the three weeks," Paul said. "You (would) send it back and they say, 'No, just change that line.' It's another three weeks, another three weeks. Meanwhile, it's costing an extra tens of thousands of dollars."

But opening Sam's Chowder House last November was like day compared to night, the Shenkmans have said. By that time, the city had hired three additional building technicians, who were redubbed "development project coordinators" under the charge of serving as catch-all liaisons between city departments and project applicants. The city previously only had two building technicians.

"Every applicant has a contact, and it's one of these project coordinators," said Development Center Manager Rosemary Morse. When applicants seek permits, the Development Center gives them a sheet of paper that lists the names, emails and phone numbers of all five project coordinators.

"So anything that comes up, any problems that they have, any glitches, they can call this coordinator (who) can attempt to help them through, because there is a lot of that (miscommunication) between departments," she said.

The hiring for and renaming of the project coordinator position was one piece of a 2012 initiative called "Blueprint for a New Development Center," which launched the same year that Campo 185 opened. The effort aimed to streamline service at the city's much-criticized development center by adding staff, moving planners to the Development Center building to improve internal coordination and communication, changing the center's hours and making application documents, updates and processes available online. The Development Services Department also started "tiering" projects based on their complexity, designating specific staff for each type.

"We looked at the system through a very lean perspective to try to eliminate waste," Pirnejad said. "We streamlined a lot of the efforts."

"We wanted to make sure that we supported those businesses that provide an economic or social benefit to the city, and restaurants do both," he added.

The Blueprint was also about changing the culture of the Development Center -- and the employees who work there, Morse said.

"That was a big part of it. So instead of people thinking, 'Hey, there's something wrong; I'm going to tell them and then I don't care anymore,' ... (it's) 'Let's try to help them through the process,'" Morse said.

From the city's perspective, it's largely been a success. Pirnejad said they aim to get plans submitted for review out in five days. For complicated projects, it's 30 days. And the percentage that they've hit these timeline goals has improved from 68 percent two years ago to 92 percent last year, he said. The city is hovering around 94 percent this year.

"We've increased amount of plans that we do over the counter and also increased our express plan checks," he added. "I don't hear from our restaurants anymore because I assume we're getting them in and out quicker."

However, he said what they're working on the remainder of this year is simply getting out the word.

"We've had so many improvements over the last year and a half," Pirnejad said. "It's hard to communicate that with customers.

"We want feedback from our customers, positive or negative," he added.

Restaurateurs -- some who have already opened and others who are still in the process -- have plenty of feedback to give.

Guillaume Bienaime, a local chef set to open a French restaurant directly across from the Development Center in the coming weeks, said he feels there is still a disconnect between the city's process for getting restaurant projects through the pipeline and the entrepreneurs.

"I just feel like they don't understand what small business owners have to go through," said Bienaime, who worked as a chef at local restaurants before deciding to open his own. "So when they make you do something, which I guess they believe is for the greater health or safety of people or the community, it seems to be costing a lot of money. It's hard because its unpredictable. You think you see a space and you think you're spending this amount and they tell you that you need a $5,000 grease trap. ... It is what it is. You can't do anything about it."

Bienaime, who started on his project this March, said he appreciated that he was able go online and check the status of his permit applications, but that the project coordinators were not as helpful as they are made out to be. He said they sometimes gave him wrong information and were not as well-informed as plan checkers.

A veteran Bay Area restaurateur who opened in Palo Alto this year but wishes to remain anonymous echoed Bienaime's sentiments.

"There aren't clear directions given" to staff, he said. "Accountability is kind of lacking in some areas."

Reminiscent of the Shenkman's experience with Campo, he said his documents that were waiting for approval often wound up "sitting on somebody's desk for a week" until another person "happened to pick it up." He said at one point, a city inspector who was scheduled to come to the restaurant one weekend simply didn't show up. He also said his architect built extra hours into his estimate for a specific element of the project because "he knows he has to deal with Palo Alto."

The owner was also unaware of the project coordinators and had not worked with one.

"It just doesn't seem like they want you," he said. "It's not a very welcoming process."

Jacquetta Lannan, a lawyer-turned-restaurateur in the process of opening hot dog eatery Chez Franc on California Avenue, said when she first signed her lease in September 2013 and started telling people she was opening a restaurant in Palo Alto, "Everyone said, 'You just wait -- you're going to get caught up in the Palo Alto process and it's going to take forever,'" she said. "Everybody talks about the Palo Alto process."

One year later, Lannan has yet to open Chez Franc, though she attributes that to other factors.

Pirnejad said he hopes to hear from more customers so the city can continue to improve.

"So far, it's been positive in a lot of ways, but we still have a long way to go," Pirnejad said. "We're still working on it."

Comments

1 person likes this
Posted by Joseph E. Davis
a resident of Woodside
on Sep 13, 2014 at 10:40 am

This process would be absurd at a tenth the cost and time.


2 people like this
Posted by Wondering?
a resident of Another Palo Alto neighborhood
on Sep 13, 2014 at 11:39 am

Gee .. didn't City Manager Keene hire TWO (2) managers last year to "clean up" the mess surrounding the construction approval/permitting process?

Guess he will now have to have a couple more people to manage those managers, and to focus on "streamling the process" more than the last two have been able to do.

Wonder how long 27 University would have taken to get its permits/approvals if the story had not broken the way that it did?

Or maybe .. we should consider getting a City Manager who actually works for everyone--not just the favored few who are able to gain access to this almost invisible man.


Like this comment
Posted by John
a resident of Downtown North
on Sep 13, 2014 at 1:00 pm

We have opened two restaurants in downtown Palo Alto, and we have experienced a process that is reasonable in both method and time. I often hear stories of people lamenting all they need to do to get up an running, but what they do not understand is that restaurants by nature have more process/regulations/rules than many other types of businesses because of public safety. It is my impression that 90% of the people opening restaurants do not have experience in the industry and trip and fall along the way, costing money and failure. That is not the City's fault.

With that said, all processes can be more efficient, and so if the City has made the process more efficient, than great for everyone.


Like this comment
Posted by Wondering?
a resident of Another Palo Alto neighborhood
on Sep 13, 2014 at 1:34 pm

> That is not the City's fault.

That really depends on how difficult the process is, how well documented it is, whether there are sufficient staff available when the project is going through the process, and the personality of those on the City-side who are dealing with the applicant.

And then there is the issue of how different are things in Palo Alto from Mountain View and Menlo Park?

Clearly the process has been found wanting .. as the City Manager hired new managers a year, or two, ago. There has never been a really good public airing of the process to get a project through City Hall, so maybe it's time for the City Auditor to look at what's going on from both the City-side and the Client-side.




Like this comment
Posted by Dave Thompson
a resident of East Palo Alto
on Jul 6, 2015 at 12:13 pm

[Post removed.]


5 people like this
Posted by Time is of the Essence
a resident of Barron Park
on Jul 6, 2015 at 4:31 pm

If time is money, patience will bankrupt a restaurateur.


Sorry, but further commenting on this topic has been closed.

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