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Planning commission approves chain store limit on California Avenue

Commissioners support Palo Alto council's effort to keep 'second downtown' eclectic

Palo Alto's effort to promote an eclectic and independent retail mix on California Avenue by limiting chain stores in the city's "second downtown" took a big step toward reality on Wednesday night when the Planning and Transportation Commission gave the proposal its unanimous blessing.

The 7-0 vote, which followed a long discussion over the details of the ordinance, came despite concerns from some commissioners about the details of the new proposal and a wide variety of concerns by individual members.

Commissioner Mark Michael, for example, proposed that franchises be excluded, something that the rest of the commission did not go along with. Commissioner Kate Downing, meanwhile, wondered why the city's revised definition of "allowed retail" expressly excludes nails salons and barber shops and argued that the city should not be trying to limit these establishments.

These cavils notwithstanding, the commission generally agreed that the general push toward promoting fewer chain stores on California Avenue is the right approach. Once the council reviews and approves the ordinance, it would cement beyond the current two-year timeframe the retail restrictions on California Avenue, which is at the epicenter of the city's hot construction climate.

The new ordinance applies to retail businesses, including restaurants, with 10 or more business locations in the United States. It also extends the retail district to Cambridge Avenue, which runs parallel to California Avenue.

"While Palo Alto has several commercial areas which currently house large scale formula retail businesses, the City of Palo Alto desires to retain and foster an eclectic, vibrant and diverse collection of retail and personal services establishments in the California Avenue area in particular," the new ordinance states.

The unanimous vote was notable given the commission's recent split with the City Council on other major issues, including reforms to the "planned-community" zoning and the proposal to create an annual office cap in downtown, California Avenue and El Camino Real.

On Monday night, as the council discussed the planned-community reforms, the commission was chided for an apparent "disconnect" between the council's direction and the recommendation of the commission, whose role is to advise the council.

Councilman Pat Burt described the commission's recommendation of planned-community reforms (which would have permitted, among other things, developer payments for zoning exemptions) as the "opposite" of the council's direction.

"There seems to be a very strong disconnect between what the commission recommended or even considered and what the council gave as guidance, given that you as a commission are appointed by the council to advise the council according to the direction we provide and your best judgment," Burt said.

Similarly, the council and the planning commission have been out of step on the subject of the city's cap on office growth, which the council unanimously agreed to pursue earlier in the year but which the commission vehemently opposed at its meeting in July.

On Wednesday night, the commission reluctantly voted to support the office cap proposal by a 4-2 vote, with commissioners Michael and Downing dissenting. The commissioners also agreed that the new office cap should not apply to areas that have been subject to "coordinated-area plans," multi-year planning processes with heavy community involvement. The issue of whether these areas should be included in the ordinance was at the center of the council's dispute about the new ordinance in June.

But when it comes to banning chain stores, everyone was more or less on the same page. Even though some commissioners had quibbles, after a long discussion everyone voted to support it.

Jessica Roth, owner of European Cobblery and a leading proponent of the chain-store limitation, urged the commission at Wednesday's meeting to support the proposal, which she said is essential to preserving California Avenue's independent character.

"I feel there are great spots in Palo Alto for big businesses -- Stanford Shopping Center and some big spots downtown," Roth said. "If we don't do anything to protect Cal Avenue, we're going to lose the small mom-and-pop shops eventually."

Even despite the unanimous vote, the commissioners varied in their level of enthusiasm for the new law.

Michael Alcheck said he was a "big fan" of the proposal to limit chain stores, while Michael said he would support it on the basis of it being "good enough." He nevertheless argued that the city's energies would be better spent on long-term planning efforts like area plans and the update of the Comprehensive Plan.

Downing, meanwhile, marveled at the new definition of permitted retail, which require nail salons, barber shops and beauty shops to acquire conditional-use permits from the city before they can set up shop on California Avenue. The clause was put in by the council out of recognition that these establishments are already plentiful in the California Avenue area.

Downing didn't buy that argument, saying, "The fact that they're there and have been there for many years tells me they're successful. It means people actually use them."

Commissioner Eric Rosenblum countered that this argument can apply equally well to a McDonald's, a Starbucks or a Subway. The whole idea of the ordinance, he said, is to "artificially maintain an eclectic mix on Cal Avenue."

At the end of the discussion, he and the rest of the commission agreed to leave unchanged the recommendation from staff, which hews closely to the guidance it received from the council in May.

"You're trying to find a way to create a multi-culture versus a monoculture," Rosenblum said.

Comments

17 people like this
Posted by Ellen
a resident of College Terrace
on Aug 27, 2015 at 10:47 am

Will the "small mom and pop stores" be able to afford the current high rents? Perhaps only the chains have the resources for that. Or will weak rental competition eventually lower the rental rates? Will the landlords approve of the council's decision then? Artificiality has its drawbacks.


13 people like this
Posted by Joseph E. Davis
a resident of Woodside
on Aug 27, 2015 at 10:55 am

Truly a bad ordinance. The city government should have as much to do with the mix of businesses on a given street as it does with the racial makeup of who can buy houses in a particular neighborhood. That is to say, nothing whatsoever.


7 people like this
Posted by Resident
a resident of Another Palo Alto neighborhood
on Aug 27, 2015 at 10:58 am

I strongly feel that this will end up being the demise of the area. Apart from those who work or live in walking distance, it is the chains that are the anchors to the area. I am unlikely to visit an unfamiliar store unless I pass it and if there are so many unfamiliar stores I am unlikely to visit the area anyway. I am drawn by something familiar that I want to visit. I tend not to be drawn to the unfamiliar.


Like this comment
Posted by 38 year resident
a resident of Old Palo Alto
on Aug 27, 2015 at 11:11 am

Ellen makes a great point. Commercial space rental costs may be unsustainable for small, local businesses. Will the city then step in and try to regulate what a commercial property owner can demand for leasing his/her property? With this city council, it wouldn't surprise me if they did.


17 people like this
Posted by Nayeli
a resident of Midtown
on Aug 27, 2015 at 11:19 am

If this same law had been enacted years ago on University Avenue (and the rest of the downtown area), the place wouldn't have much to offer. There would be no Cheesecake Factory, RocketFizz, CVS, Starbucks, Peet's, Pizza My Heart, Yogurtland, Subway, Sprint, Verizon, Apple Store, Paris Baguette, La Boulange, Whole Foods, etc...

What difference does it make? Even most Mom & Pop stores aspire to expand. People know what they want and will shop/dine in places that they desire. If it isn't in Palo Alto, they will go elsewhere. There is a domino effect with this that effects other businesses in the area.


15 people like this
Posted by If If If
a resident of Another Palo Alto neighborhood
on Aug 27, 2015 at 11:30 am

If only landlords weren't so greedy, if only rents weren't so high, then mom and pop businesses could afford Cal Ave

But, landlords are entitled to what the market will bear, and only big chains can afford the rents here. So why exclude them?


19 people like this
Posted by OPar
a resident of Duveneck/St. Francis
on Aug 27, 2015 at 12:57 pm

There are a couple of chains on California, but it's mostly independents, so as long as rents aren't boosted excessively and commerce doesn't grind to a halt because of some sort of massive redevelopment, making California an enclave for local businesses seems like a good thing. I already find it more useful than University--it has a stationery store, a toy store, a real health foods store, the city's only remaining art store. I just wish there was a book store again.


16 people like this
Posted by Alice Schaffer Smith
a resident of Green Acres
on Aug 27, 2015 at 3:25 pm

Cheesecake and its ilk are amongst the parts of University Avenue which I loathe. The small ethnic stores (Iranian, Vietnamese,etc) serve delicious food. Quite a difference.


7 people like this
Posted by Joseph E. Davis
a resident of Woodside
on Aug 27, 2015 at 4:24 pm

Alice, just because you don't like a business doesn't mean that the city government should prevent others from having the choice to go there. If enough people agree with you, the business will fail all on its own.


6 people like this
Posted by running scared
a resident of Another Palo Alto neighborhood
on Aug 27, 2015 at 6:25 pm

Since the ARB, with staff support, approved The Cheesecake
Factory on University Ave a chain store limit on California Ave
is mandatory since this shows what can happpen.


3 people like this
Posted by Casey
a resident of Midtown
on Aug 28, 2015 at 7:06 am

How about a chain store ban for Edgewood too? That way we can get an eclectic mom and pop grocery store.


14 people like this
Posted by Todd
a resident of Another Palo Alto neighborhood
on Aug 28, 2015 at 9:07 am

All things being considered though, shouldn't we feel lucky and grateful for any store thats willing to locate in Palo Alto?


Posted by Parent
a resident of Duveneck/St. Francis

on Aug 28, 2015 at 10:50 am


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4 people like this
Posted by Crescent Park Dad
a resident of Crescent Park
on Aug 28, 2015 at 11:00 am

@ Casey - great idea if you want to keep the location closed. Somewhere between the Sand Hill claim of asking every grocer on the planet and all the residents claiming that there are plenty of candidates lies the truth. But if you want to reduce the candidate pool to a handful of grocers, go for it.

Economies of scale are what drives the grocery business. Despite what happens in our local economy (high tech profits, etc.), grocery chains face razor thin margins. A chain grocery actually stands a better chance at succeeding at the Edgewood location as their overall wholesale buying power will (on average) helps to keep their operating costs lower.


Like this comment
Posted by SteveU
a resident of Barron Park
on Aug 28, 2015 at 12:51 pm

SteveU is a registered user.

High volume is how modern retail makes it in these times.

Chains and buying COOPs have the High volume to demand discounts and also have the economics of bulk (truck load) deliveries.

Mom and Pop do not have the resources for big advertising blitzes.
Mom and Pop do not have the extra resources for new product introduction (ability to survive a flop).
RENT,
Utilities
and Payrolls must be met, on time.

Here is hoping that vacancies will force RENT to drop.


10 people like this
Posted by Watched the meeting
a resident of Crescent Park
on Aug 28, 2015 at 11:01 pm

Planning Commissioner Kate Downing said she didn't see any reason to limit the number of hair and nail salons. They seem to make a living.
That's the caliber of a person who serves on the city's Planning Commission.

BTW the 5 members of the ARB who approved the Facade of Roxy Rapp's Cheesecake Factory building on March 6, 2003 were
Board members: Lee Lippert (Chair), Drew Maran(Vice Chair), Kenneth Kornberg, Judith Wasserman, Susan Eschweiler

Staff: Amy French, Current Planning Manager
Staff Liaison: Steven Turner, Planner


Like this comment
Posted by Benjamin
a resident of Community Center
on Aug 29, 2015 at 7:46 pm

Seems to me that the city has tried many times, and has failed miserably each time, trying to regulate grocery stores in specific locations. Edgewood Plaza the latest blunder, and the former JJ&F development almost assuredly to be the next blunder, and it's not even finished.

While I appreciate the dislike and/or misfit of chain stores by some of the Cal Ave merchants, be very careful of what you wish for. That simple choice today may have unintended consequences down the road. Besides, any business will flourish, survive, or die depending on what their customers decide to do with their cash, not what city hall mandates. There are a couple of 'chain' shops on Cal Ave, eateries, that I have visited and can't figure out why they persist. I expect that in time, they will disappear.


8 people like this
Posted by Ahem
a resident of Another Palo Alto neighborhood
on Aug 29, 2015 at 10:11 pm

Joseph E. Davis,

If the landowners along California Avenue didn't want the government meddling in their business, then they shouldn't have pushed the Palo Alto City Council and staff to seek California State redevelopment funds to gentrify the street.

I didn't hear any complaints about government meddling when it involved the landowners getting millions in taxpayer funds from the government to improve their properties.


2 people like this
Posted by Maurice
a resident of Old Palo Alto
on Aug 30, 2015 at 8:23 am

My issue is that most chain stores and restaurants are franchises. They are small businesses. I read somewhere that most Subway restaurants are owned by individuals who own just one or two restaurants (usually in the same town our area). I suspect that the same is true with most chain restaurants that e encourage franchises. Does this policy limit them?


2 people like this
Posted by running scared
a resident of Another Palo Alto neighborhood
on Aug 30, 2015 at 8:38 am

@Watched the meeting
Good research on the "Cake" debacle on University Ave. Also I believe
the item was initially agendized for ARB review as a "facade remodel" then changed. It was a total gutting of the Copelands Sports for an unfettered mall design Cheesecake Factory for the heart of Downtown Palo Alto on University Ave. Ironic that a sports equipment and exercise equipment store which Cake replaced is at the other end of the spectrum from a Cheesecake Factory. "Cake" a couple months ago took second place I believe in the Xtreme Eating Awards given by the Center for Science in the Public Interest for the worst chain restaurant meals in terms of calories, saturated fats,sodium and added sugars for their Louisiana Chicken Pasta. If there was a national award for the worst urban design in a Downtown commercial district Cheesecake Factory on University Ave in Palo Alto would take 1st
place in that one, the Grand Prize.




2 people like this
Posted by running scared
a resident of Another Palo Alto neighborhood
on Aug 30, 2015 at 9:16 am

On a constructive note let's try this. The founder, CEO and Chairman of Cheesecake Factory,David Overton, was a drummer in a rock band in SF in the 60's. He knows Palo Alto.The Grateful Dead was formed in Palo Alto. Jerry Garcia rented instruments at Swain's House of Music on University Ave,
down the street from where Cheesecake Factory is now. So why don't Overton and Roxy Rapp get together and do a complete facade remodel of Cake on
University Ave?


2 people like this
Posted by Watched the meeting
a resident of Crescent Park
on Aug 31, 2015 at 1:59 pm

Thanks, running, it did take quite a bit of searching. Can't find the minutes for that meeting.
About changing the facade, it is possible Roxy likes it the way it is. But since he constantly claims how much he loves Palo Alto, maybe the idea would appeal to him, to avoid his building being a candidate for the worst design in town.
We need a contest.


Like this comment
Posted by runnng scared
a resident of Another Palo Alto neighborhood
on Aug 31, 2015 at 10:09 pm

@Watched the meeting
When Rapp put a Cheesecake Factory on University Ave in 2003 it was known at that time for 40 minute waits in malls around the country. This one on University Ave was about number 100 in the chain. So for Rapp it looks like it was a business decision and the context was not a determining factor.
The next 50 Cakes following University Ave in Downtown Palo Alto I believe were all in malls. Even in those settings in a place like Bellevue WA and now recently opened in Downtown San Diego at the historic Headquarters at Seaport there is strict sign control on the street facade. So there you have it. You would think at this point that Roxy Rapp would concentrate his efforts and all his energy. even at his own expense, on doing a complete facade remodel just for the sake of his own legacy in Palo Alto. And David Overton as well would join Rapp in getting it done. He was the drummer in a rock band in SF in the 60's- how can he accept this outcome on University Ave in Downtown Palo Alto? A prominent techie from NYC here for a conference not long ago, saw the Cheesecake Factory on University Ave and said to me "I thought a place like Palo Alto would have design control". And he took that image back with him to NYC.



8 people like this
Posted by Ahem
a resident of Another Palo Alto neighborhood
on Aug 31, 2015 at 11:29 pm

The residents of Palo Alto need to stop humbly imploring the marquee real-estate developers to solve the problem. The real-estate developer are not the solution, the real-estate developers are the problem.

After years of abuse by real-estate developers, some Palo Alto residents seem to have developed a form of Stockholm Syndrome, where they have come to identify with their abusers/captors.

Stockholm Syndrome Web Link


Like this comment
Posted by Curmudgeon
a resident of Downtown North
on Sep 25, 2015 at 3:52 pm

"Posted by Joseph E. Davis a resident of Woodside on Aug 27, 2015 at 10:55 am

Truly a bad ordinance. The city government should have as much to do with the mix of businesses on a given street as it does with the racial makeup of who can buy houses in a particular neighborhood. That is to say, nothing whatsoever."


We have received our instructions from Developerville. Take note, city council.


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