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Developer offers $13 million for school land

Original post made on Mar 20, 2013

A housing developer has offered to pay $13 million to the Palo Alto school district for a 2.6-acre parcel at 525 San Antonio Ave. that it sold to the district in 2011 for $8.5 million.

Read the full story here Web Link posted Wednesday, March 20, 2013, 12:02 PM

Comments (34)

Posted by Wondering?
a resident of Another Palo Alto neighborhood
on Mar 20, 2013 at 1:40 pm

> "While I deeply worry about what this price suggests about
> the future of our community to be economically diverse,
> I do feel that the increased value reflects well on
> the work of the schools in our community."

For the past decade, or so, property in Palo Alto has been selling for about $5M/acre. So, 2.6 acres should command $13M.

Summerhill seems to be simply willing to pay market price for this property. How could anyone who understands the Palo Alto real estate market make silly claims like this one?

Posted by Skelly is just full of surprises lately
a resident of South of Midtown
on Mar 20, 2013 at 2:03 pm

Will Summerhill be expecting upzoning if they buy at this price?

Was Skelly given any direction by the Board on this subject? Was a future agenda date for decision-making set?

Has the Board or Skelly (neither of whom know much about land use) hired anyone with some expertise to advise them on this?

What would PAUSD use the money for? Did they disclose this?

Was there any discussion about what this might mean for future use of Greendell?

The guessing games are tiresome, fuel public speculation and irritation. It would be nice to get more information so we could have a meaningful public conversation.

Posted by JA3
a resident of Crescent Park
on Mar 20, 2013 at 2:47 pm

It's a great time to be a seller of real property in Palo Alto; if there is no firm need for the land now, then the District would be wise to consider a sale. Thanks, Weekly, for the informative article, particularly the details on prior sales.

Posted by question
a resident of Duveneck/St. Francis
on Mar 20, 2013 at 2:53 pm

Would the kids in these new Summerhill homes attend Palo Alto schools? How many would be expected?
Since the piece of land connects with the Greendell/Cubberley site, the Board should at least consider if it makes sense to keep hold of this land, for awhile at least. Another developer would offer to buy it in future, if that is what is for the best (to sell it off). Being pressured on short notice doesn't seem to be the best for the PAUSD, especially in view of the story which indicated committees haven't even been considering this parcel in the mix of options for the schools.

Posted by Resident
a resident of Another Palo Alto neighborhood
on Mar 20, 2013 at 3:00 pm

PAUSD is in the business of educating children, not real estate speculation.

It would be very unwise to even consider selling this land.

High School, middle school as well as elementary school populations are ever increasing. This site will be needed and in the not too distant future. Stop rubbing greedy $$ centered eyes at this and start putting out some real plans to provide for our ever growing school populations.

Posted by Old Palo Alto
a resident of Old Palo Alto
on Mar 20, 2013 at 3:11 pm

$13MM is peanuts for that land. For 2.6 acres in that location the land would be worth about $30MM.

Posted by musical
a resident of Palo Verde
on Mar 20, 2013 at 3:39 pm

$13MM is 80 cents per square inch. I remember when 80 cents would buy a donut.

Posted by curmudgeon
a resident of Downtown North
on Mar 20, 2013 at 4:04 pm

"Will Summerhill be expecting upzoning if they buy at this price?"

Most definitely. It's the proven Palo Alto minuet: developers overpay for the land, then they cry to City Hall that they need upzoning to make their development economically feasible. It works every time, especially for politically well-connected, lavish campaign donors like Summerhill. And, since their major advocate has just rejoined the council, they are sure to get their way.

This is how our city government enables and underwrites our real estate hyperinflation.

Posted by Concerned Neighbor and a Parent
a resident of Barron Park
on Mar 20, 2013 at 4:12 pm

The school district should not be selling this land to a developer. The new school maybe needed sooner they they might think.
The number of kids going to Palo Alto school is constantly increasing, thanks to developers such as Summerhill. At the same time, when was the last time the new school has opened? These new houses / or rather town homes, squeezed to maximize the number of units, will surely bring many additional kids to the strained school, increasing the pressure on existing schools / teachers / children. Even if people simply rent properties out, it is going to be bad. This year, the rental place across from me was rented out with whooping 26 offers only because of the school district and a reasonable rent price.
I am not mentioning that the land can be developed in many other ways, similar to what neighboring Mountain View has done.
District people that live in Palo Alto should ask yourself another question: when was the last time they have bought groceries in Palo Alto stores? Maybe if the land was developed slightly differently, maybe there would not be a reason do drive to Mountain View for groceries.

Posted by Jayne
a resident of Meadow Park
on Mar 20, 2013 at 5:09 pm

I've heard it suggested that the PAUSD could either use or sell the land at 525 San Antonio Road to the Bowman School so they can take over the Bowman School site next door to Terman. Terman could then be enlarged and be equal in size to both JLS and Jordan. This would be a much better use of this valuable piece of land.

If Summerhill has any hope of acquiring that land they better start by upping their offer to $20 Million because that's what it will be worth in five years. Meanwhile, School District hold on to that land.

Posted by Crescent Park Dad
a resident of Crescent Park
on Mar 20, 2013 at 5:23 pm

Or do a land sell and/or swap with CPA in exchange for the portion of the Cubberly site that is owned by the city...then CPA can do their non-profit space there.

Posted by Leave it to Kevin
a resident of Another Palo Alto neighborhood
on Mar 20, 2013 at 5:51 pm

Skelly is good at only one thing--making poor choices. With the booming population in PAUSD, he has no business selling off this land that may be soon needed. School and classroom populations are getting rather too full by all accounts.

Skelly also has no clue about how much that land is worth. Summerhill is an experienced developer and knows that what has been offered is a bargain-basement price; it's part of their plan to make a big profit.

If Skelly is too dense to know he is being conned by pros, and too dim to know the district is going to need that land, those are two more reasons why he should not be in the job he now so I adequately holds.

Posted by Garrett
a resident of another community
on Mar 20, 2013 at 9:21 pm

It would make sense to keep this site, while schools get rebuilt, redone or some other work is undertaken at a site. This site could be used to house students while schools are ready.

Check with the Los Alto School District on leasing the site, until a more NEC site can be found.

Posted by Are you kidding?
a resident of Gunn High School
on Mar 21, 2013 at 10:54 am

Do people realize what is expected of Palo Alto for new housing? ABAG has set astronomical goals for new housing. Well, these houses (even if apartments) will come with some number of kids. Where else in Palo Alto is there enough land to build a new school? (By the way, several of our current school sites do not meet state standards for minimum land size.) PAUSD would be crazy to sell this land!

Posted by question
a resident of Duveneck/St. Francis
on Mar 21, 2013 at 10:57 am

That's exactly what I asked above - if homes or apartments are built on this land - WHICH school district would be their attendance area? PA or LA elementary?

Posted by NoNoNo
a resident of Palo Verde
on Mar 21, 2013 at 11:17 am


Posted by luv land
a resident of Midtown
on Mar 21, 2013 at 11:20 am

Well, if the school needs more space, do it UP, like two to four levels, to save area for more green areas please!!

Posted by palo alto mom
a resident of Palo Alto High School
on Mar 21, 2013 at 11:39 am

According to the PAUSD website 00201-00999- odd on San Antonio is the Palo Alto school District.

2.6 acres in Palo Alto is already worth around 20 million, not 13.

Posted by land is king
a resident of Los Altos
on Mar 21, 2013 at 12:25 pm

Menlo sold Laurel school when they *thought* they didn't need the land, then the fools had to go buy more land later, at higher prices.

Explaining why Laurel School is not on Laurel Avenue anymore... and why they blew through a ton of money.


Posted by Concerned Retiree
a resident of Midtown
on Mar 21, 2013 at 12:31 pm

Enough new housing already. We need facilities to take care of our present population. Humbug to ABAG and Summerhill homes too.

Posted by Alice Smith
a resident of Green Acres
on Mar 21, 2013 at 12:38 pm

NEVER SELL SCHOOL LAND AGAIN, PALO ALTO. Haven't we learned our lesson? Once sold, never retrieved.

Posted by Paly Parent
a resident of Duveneck/St. Francis
on Mar 21, 2013 at 1:40 pm

Where in the article does it say the school is considering selling this property? It looks like they simply disclosed the offer - a reasonable thing to do.

Posted by palo alto dad
a resident of Crescent Park
on Mar 21, 2013 at 2:15 pm

NoNoNo is absolutely right. I've lived in this community for 30 years and as we all know they are not making any more land. We've lived to regret selling all those school sites back in the 70's and 80's. Once they're gone they're gone. Summerhill will most likely have to increase the density on the site because they can't make money paying $1.3M per lot at that location. Learn an lesson from Stanford and hold onto the land and lease it if necessary.

Posted by Confused
a resident of Barron Park
on Mar 21, 2013 at 2:19 pm

The comments by Barb Mitchell and Melissa Baten Caswell imply that the district is buying, not selling, the land. Am I missing something?

"This is the first proposed addition of public school land in over a generation, ending an old, long streak of school district sales," board member Barb Mitchell said of the San Antonio purchase in 2011.

"This is a big deal," said then board President Melissa Baten Caswell. "It's been a long time since the Palo Alto Unified School District moved forward on acquiring any property, so this is big news."

Posted by No longer confused
a resident of Barron Park
on Mar 21, 2013 at 2:24 pm

Referring to the 2011 purchase. Sorry!

Posted by bad precedent
a resident of Adobe-Meadow
on Mar 21, 2013 at 5:18 pm

Sounds bad. Previous owner sold to the district at a knock down price because they were selling to the district. If the district sells, who looks like a mug?

Posted by Let HIm Sell
a resident of Midtown
on Mar 21, 2013 at 5:37 pm

[Post removed by Palo Alto Online staff.]

Posted by Jana
a resident of Old Palo Alto
on Mar 21, 2013 at 5:56 pm

Skelly needs to be fired. Why do Palo Altans allow such incompetence?

Posted by Cur Mudgeon
a resident of Greenmeadow
on Mar 21, 2013 at 7:52 pm

HOLD THE LAND. Lived here since 1976 and well remember Cubberley being closed, as well as many others. NO MORE SALES OF SCHOOL PROPERTIES. Look at Terman--and the adjoining apartments which were once school land.

Posted by Michele
a resident of Greenmeadow
on Mar 21, 2013 at 8:09 pm

Don't sell it.

Posted by Paly Parent
a resident of Duveneck/St. Francis
on Mar 21, 2013 at 10:40 pm

My last message seems to have gone unnoticed. So, I'm going to ask again. Why do you think the District is planning to sell. The article says they're considering putting an elementary school on the property. It doesn't say they're going to sell, just that the offer was received. As a public entity, don't we want them to tell us about the offer?

This reaction is very confusing to me.

Posted by Parent
a resident of Old Palo Alto
on Mar 21, 2013 at 11:08 pm

I agree with the previous poster. This thread is indicative of the insult first, think later crowd.

The school has made a paper profit of about $5 MM - great. Congrats to District.

The District is not selling - but the developer seems to have had seller's remorse.

There is no story here other than that -and yet all of this posting. Odd....

Posted by James D
a resident of Barron Park
on Mar 22, 2013 at 8:45 pm

From my understanding this whole process is a terrible travesty. SummerHill bought it from the previous owners of over 50 years who ran the Peninsula Day Care Center. They were going to pay a price of around 9.5 million but since the City turned them down in building over 20 homes they got the price down to 4-5 million and then sold it to the School Board for 8.5 million. I don’t know what it is ultimately worth but the previous owners got hurt really bad.

Posted by The rest of the story
a resident of Charleston Meadows
on Mar 23, 2013 at 1:24 pm

@James D, you got much of the story right. I remember reading about this in several articles and heard the same from neighbors.
PAUSD was originally offered the site for the ~$5M, but Skelly turned it down. Summerhill then took the offer. After Summerhill was under contract with the sellers, and while Summerhill was in the middle of seeking entitlements from the city, Skelly suddenly told Summerhill that they wanted to buy the property. At the same time, the city got strong push back from the adjacent neighborhood against increasing the zoning to allow for more units. Summerhill claimed that Skelly had pressured the city into that decision and that Skelly had improperly undermined the value of their deal with the sellers. Consequently, PAUSD had to pay Summerhill $8.5M to avoid litigation, costing PAUSD an extra ~$3.5M! So this was another big Skelly "me bad" occasion for which he was praised by the board. "And the beat goes on..."

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