U.S. Postal Service officials have nixed plans to move the downtown Palo Alto post office to a building on the corner of Addison Avenue and busy Alma Street, Tom Samra, facilities vice president, said in a letter to Mayor Karen Holman dated Aug. 19.
The letter called the decision "final."
Postal service officials announced plans in December 2011 to sell the historic building at 380 Hamilton Ave., and relocate to a smaller space as part of a nationwide cost-savings plan. The building is on the city's historic resources inventory and was designed by prominent local architect Birge Clark. It is also located in a prime downtown location.
The city announced it was interested in purchasing the building in 2012. Holman confirmed that interest in May of this year.
Postal officials held a public meeting on May 28 in the building's lobby to discuss a proposal to move to the corner of Addison and Alma at the former location of the retailer Anthropologie, which moved to Stanford Shopping Center.
Officials said they were considering various options, including selling the Hamilton building and leasing the basement for post-office services.
But postal service officials considered all of the concerns expressed at the meeting and afterward, and decided to cancel the move to Alma Street.
"During the public comment period and at the public meeting there appeared to be a consensus that the 999 Alma site had negative issues with regard to: parking, traffic along Alma Street, foot traffic access, and the location 'not being in the downtown core.' In addition, after internal Postal review, concerns about pick-up and delivery were identified. At this time, the Postal Service intends to remain at 380 Hamilton Ave.," Samra wrote.
Mayor Holman said she was "very happy about the post office staying on the site, and I'm sure the public will be happy."
But she said the letter was not clear about whether the building would be sold and the postal service would then lease part of the site. Holman asked for clarity on that point before she takes the letter and information to the City Council. That response came just yesterday afternoon, she said.
"As I understand it, they are going to remarket the property with a stipulation that they want to stay on the site," she said. But she emphasized that she has only received this information verbally and has received nothing in writing.
Postal service spokesman Augustin Ruiz said in an email that the agency has not yet decided what to do with the building.
"We are still in the planning stages on what to do next," he said.
Holman said at the May 28 public meeting that the city is definitely interested in purchasing the building and keeping the post office at the Hamilton site and leasing the basement to the post office.
But the city cannot purchase the building outright, a postal official said at the time, because regulations require the sale must go out for bid.
Several residents expressed concern that the city might be outbid by deep-pocketed tech firms. The last appraisal of the building three years ago valued the property at $6 to $7 million, but that sum is probably significantly higher now, the official said.
But the three-person committee that will choose the buyer would not be bound to take the highest bid. Other factors, including benefits to the community, might sway the sale decision, he said.