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Fearing a lawsuit, Palo Alto backs conversion of President Hotel

Original post made on Jun 23, 2020

In a dramatic about-face, the Palo Alto City Council agreed on Tuesday night to approve the conversion of the iconic President Hotel on University Avenue from an apartment complex to a boutique hotel.

Read the full story here Web Link posted Tuesday, June 23, 2020, 10:17 PM

Comments (66)

Posted by Name hidden
a resident of Downtown North

on Jun 23, 2020 at 10:32 pm

Due to repeated violations of our Terms of Use, comments from this poster are automatically removed. Why?


45 people like this
Posted by Rebecca Eisenberg
a resident of Old Palo Alto
on Jun 23, 2020 at 10:48 pm

Thank you for pointing out that our City Attorney made the same legal arguments as AJ Capital's attorneys. Given the huge amounts of case law dispute that legal conclusion, and the complete absence of any case law backing up this decision, it's fairly unprecedented that a council of 7 non-lawyers would make this kind of decision based entirely on legal arguments.

What is particularly strange about this is that the city council acknowledged that they were not lawyers or judges, but were somehow "required" to make this legal decision and did so anyway.

What Palo Alto residents need to understand from this story is the following: Molly Stump may be the "City Attorney," but she is NOT the *City's* attorney. She is the attorney for the *City Council*. it is the City Council who hired her, manage her, give her job evaluations, and maintain her steeply-above-market compensation package. Her loyalty is to the City Council, not to the City or its residents.

Thus, if the City Council directs Molly Stump to give them a legal justification to let them allow AJ Capital to convert the President Hotel from an apartment hotel to an upscale boutique hotel, Molly Stump gives them one. She has plenty to choose from by looking at the volumes of letters and legal briefs lodged by AJ Capital in their relentless pursuit to convert their $67 million investment into a $200 million investment. So she picks one -- the craziest one -- because in this Trumpisphere, the craziest most backwards arguments are most likely to succeed ("No one respects women more than I do," says Trump.)

I do not know why the City Council was so determined to convert this apartment building into a hotel. It is going to make their - and our - lives much harder when the state comes in with SB35 and starts plunking high density housing wherever it wants, because Palo Alto already is near the bottom of the list of cities most behind in their SB 35 housing requirements, and this permanent removal of 75-100 additional housing units may well put us at the very bottom. (Although the city manager inexplicably claimed that these housing units were "not on the state's list," there is no evidence to support that claim and tons of evidence to dispute it).

Somehow the city council was convinced in its head that the only possible way on earth to preserve the historic nature of this building was actually to RUIN it by converting it to yet another unnecessary upscale hotel. They made that decision despite the fact that there is ample evidence that AJ Capital had multiple opportunities to sell the building to other developers who wanted to preserve it and keep it residential. But the city council chose not to ask AJ Capital whether it had received offers to purchase it and preserve it for residential use.

Nor did the city council do any exploring into whether possibly, in this city that has a higher concentration of billionaires than any other city in our planet, and quite possibly the highest density of residents who are seriously pissed off at the city council, there may be some extremely wealthy pissed off people who want to buy it just to prevent it from adding to the huge long and growing list of things that our city council has done to destroy our city.

In earlier meetings, at least the city council was more honest about the reason they wanted to cave to AJ Capital. They admitted they were afraid of being sued. They never actually reality checked the fact that no city council ever has been sued based on the theories that AJ Capital apparently was threatening to sue them under. Even if they did check, of course, they would be unlikely to see reality for what is is. After all, as they admitted tonight, they "are not lawyers."

We certainly did not learn anything about the State's most powerful *Tenant* protection law -- the Ellis Act -- tonight. And we did not learn anything about how our city council actually intends to comply with SB 35 (although perhaps we did gain some insight into our city council's opinion on the law -- they view the law as a moldable thing that they can change to suit their preferences, apparently).

But we did learn one thing, very very clearly: The City Attorney MUST be an elected office. We must make sure that our CITY has a lawyer to represent our city, as in the voters, as in the residents. We do not have that. Fortunately, this is something we can change, we should change, and we will change.


5 people like this
Posted by Dan
a resident of Midtown
on Jun 23, 2020 at 11:26 pm

It was unfortunately the right decision to avoid a big settlement payment the city would be obligated to pay when it would inevitably lose the legal challenge ... but talk about tone deaf comments:
"She said she hopes the council will be able to celebrate the project on the building's rooftop in 2022, when the project is set to be completed."


57 people like this
Posted by Another Giveaway
a resident of Another Palo Alto neighborhood
on Jun 24, 2020 at 12:36 am

This decision is the most cowardly, unprincipled, decision I have ever seen.

The council members who voted for this are not leaders. The council members who voted to approve this are much better suited for a mid-level management job at an insurance company where they could sit in a cube quaking in fear of every frivolous lawsuit, and every bullying attorney with a half-baked legal theory.

Eric Filseth admitted this decision would take the city in the WRONG direction and then voted for it anyway. What, not even a protest "no" vote?

And then council voted to direct the city attorney to break confidentiality to write a PR piece masquerading as a legal opinion to explain the decision to the public? The council and city attorney may have a right to confidentiality, but do they have a right to selective confidentiality?

Listening to the broadcast of these feckless bureaucrats made me sick.


23 people like this
Posted by eminent domain?
a resident of Green Acres
on Jun 24, 2020 at 12:49 am

Could the City of Palo Alto reclaim the President Hotel at current market value for much-needed low/moderate income housing?


54 people like this
Posted by TuppenceT
a resident of Adobe-Meadow
on Jun 24, 2020 at 1:40 am


Stump: "Council is not free to simply select the best outcome that it believes is in the interest of the community”
Unbelievable.
Thank you Lydia Kou for making a free decision and simply selecting the best outcome


10 people like this
Posted by Chris
a resident of University South
on Jun 24, 2020 at 8:04 am

Rebecca,

How is not recognizing an obvious legal and economic loss a mistake?

The money spent on a losing legal case would be much better spent on actual housing. We don’t need an attorney on city council. We need someone on City Council who sets effective policy, not the tangle of restrictrive laws that boxes do the city in on this case.


37 people like this
Posted by Resident 2
a resident of Another Palo Alto neighborhood
on Jun 24, 2020 at 8:04 am

Anything that Molly Stump quotes to justify what she wants should be looked at really closely. I remember the blatantly wrong interpretations she used in the Maybell debates before the referendum to claim that the City Council‘s hands were tied when it came to the rezoning. I thought there were ethics rules for lawyers and don’t know how someone could claim something so obviously twisted and false and remain one.

The developers here are adults and they were warned that it might not be legal to convert this to a hotel.

We need the housing here. We do not need another hotel. Neighbors, you can launch a referendum to overturn this action of the city Council. We were told at Buena Vista and at Maybell that the city would end up in a lawsuit. And maybe this time it will, but fighting for the housing is worth it, especially if it can mitigate proposals like people wanting to put a five story monstrosities on El Camino where it’s currently one story. I would at this point even support a condo conversion but not another hotel. And not giving developers the signal that Palo Alto is a pushover for any development that hurts residents.

Where are we in terms of pushing corporations illegally using downtown as research and development office parks and ruining downtown and giving nothing but headaches and traffic to the community out permanently? Maybe if it were a downtown again for residents, this wouldn’t have been so attractive to these soulless developers.

Neighbors maybe a referendum to overturn this action with a companion initiative to force the city to make good on giving residents the backlog of open space we are due in the city code for the development before any new development (except office to housing conversions) is approved is in order?


48 people like this
Posted by Anon
a resident of Another Palo Alto neighborhood
on Jun 24, 2020 at 8:45 am

Once again, Lydia Kou demonstrates that she has actual courage. And, once again, Liz Kniss demonstrates that she loves "vibrancy"-- construction disruption, noise, and dust. But, this really tops it off:

"Councilwoman Liz Kniss [...] said she hopes the council will be able to celebrate the project on the building's rooftop deck in 2022, when the project is set to be completed." LOL


11 people like this
Posted by Barbara
a resident of Downtown North
on Jun 24, 2020 at 11:05 am

What good news - the President Hotel as a "boutique" hotel - a positive for Palo Alto!!


10 people like this
Posted by commonsense
a resident of Professorville
on Jun 24, 2020 at 11:09 am

No worries. Since Covid, financing hotels dried up almost entirely. Underwriting a hotel for the coming years will surely kill this deal. Maybe they'll be applying to change the approval they have to apartments. That being said, the seismic work and other code upgrades AJ would have to do may save this building from falling down.


7 people like this
Posted by rsmithjr
a resident of Duveneck/St. Francis
on Jun 24, 2020 at 11:13 am

Apart from the issue of possible lawsuits, this is the right decision for Palo Alto. Once the President has been refurbished and has been open for a while, it will be seen as the right decision.

There is something here for advocates of housing, although it may be hard to see. The city admitted in this case that there are limits to how much the city can do to "fence in" a property owner and make it impossible to use his rights to convert a property. If we are really serious about supporting housing, we either need to support property owners and their rights in order to attract them to this community, or the city needs to be willing to do the construction itself. You can judge for yourself which alternative is more plausible.


22 people like this
Posted by NextSteps
a resident of Crescent Park
on Jun 24, 2020 at 11:17 am

In short what the Council did was let another entity fight this issue. i.e., it is now incumbent on those Palo Altans upset about these shenanigans and demanding accountability and transparency to fight this in a Court of Law. In that fight you can expect the City to waffle and not necessarily endorse AJ Capital or your cause...and wherever the chips fall, the City would fall behind that.

In prior comments on this subject there was reference to ongoing Federal lawsuit(s) involving our adjoining City of Los Altos. Reading through those lawsuits and related documents there are striking parallels with Palo Alto-Hotel President-AJ Capital. In both instances the cities subverted, perverted the municipal code that forbade change in use of nonconforming structures.

CONTEXT: In Los Altos it actually involved a non-commercial and residential property with an ILLEGAL i.e., never permitted structure that didn't comply with the Code re setbacks, daylight plane, fire safety, etc. Such a nonconforming structure, assuming it was legal and permitted in the first place, was also prohibited from change in use or alterations. However the City allowed its doubling in footprint and conversion to a dwelling! They then manufactured all sorts of pretexts to justify their bad decision and engaged in retaliation, obstruction of justice, etc. The targeted homeowner asserted his rights. Now the property owner and City and their agents (former City attorneys) are defendants in a RICO Conspiracy lawsuit in Federal Court.

Gennady, you might want to investigate and report on that matter as it has significant relevance to developments in Palo Alto (and adjacent cities).

p.s. The CA Supreme Court (read Horwitz vs City of LA) ruled cities do NOT have the discretion to grant permits that don't comply with the law just as they do not have the discretion to withhold permits that comply with the law.


8 people like this
Posted by Onrosewood
a resident of Midtown
on Jun 24, 2020 at 11:23 am

This story could benefit from a definition of the Ellis Act.


17 people like this
Posted by Midtowners
a resident of Midtown
on Jun 24, 2020 at 11:28 am

@Rebecca Hear, hear!! Molly Stump's only purpose as a non-elected official is to make sure the Council pursues the course of action least likely to result in a lawsuit affecting the council members. Therefore her only recommendations will be to pursue the path of least likely litigation. If the City's residents would like a more objective voice which better represents the actual citizens of Palo Alto this position must be changed to an elected one. If the Council still wants to hire a lawyer at their own personal expense to cover their butts then by all means they are welcome.


22 people like this
Posted by common sense
a resident of Midtown
on Jun 24, 2020 at 11:29 am

Reason why the city flip-flop: MONEY - money for development fees, money for in-lieu parking fees, money for increase in property taxes, money for increase hotel taxes collected. Who cares about the residents, the City wants money.

City council should have never approved in-lieu parking fees. They should have made AJ Capital provide the requisite parking or turn down the zoning change (or negotiated that of the 75 units, 15 would be made BMR rental units).


9 people like this
Posted by NextSteps
a resident of Crescent Park
on Jun 24, 2020 at 11:36 am

Other parallels between Palo Alto/Hotel President and the Los Altos matter described in previous comment:

Both involved nonconforming structures,
The Municipal Code in both cities prohibit "change in use" of such structures.
Los Altos permitted the change in use of an illegal SHED into a dwelling.
Palo Alto permitted the change in use of an apartment to a hotel.

In both cases City officials acknowledged the Code prohibits the Change in Use and any conversion of those structures involving change in use would not be permitted..
Later, for reasons unknown, they manufactured pretexts to explain why they backpedaled and issued permits.
This raises troubling questions of quid pro quos and other under-the-table transactions involving corrupt public servants and private entities.

In Los Altos the structure was not permitted, is illegal, did not comply with setbacks, etc. Many strikes against it that per the Muni Code required its demolition. Yet "enterprising" City agents worked hand in glove with the property owner to convert the structure to a dwelling. Project plans for the conversion represented the structure as if it was conforming (25 feet from rear, 7 feet from side) when City agents and the property owner knew well those representations were false and fraudulent: the structure sits ON the rear and side property lines.
In Palo Alto "enterprising" former City agents worked as "consultants" with AJ Capital and met with their former colleagues still employed with the City. Who knows what transpired under the table or over drinks+dinner...but a project that was prohibited by Code is now given the green light by the City Council on the advice of the City attorney.

In Los Altos the City attorney (and their firm) that represented the City during the above-described events are now defendants in a RICO Conspiracy suit. The City terminated that firm and the attorneys circa Fall 2019 as legal proceedings progressed.
In Palo Alto...????


12 people like this
Posted by TuppenceT
a resident of Adobe-Meadow
on Jun 24, 2020 at 11:55 am

Cupertino has an outside attorney on retainer and she is excellent. Palo Alto can look at outsourcing too.


12 people like this
Posted by NextSteps
a resident of Crescent Park
on Jun 24, 2020 at 12:07 pm

>Molly Stump...the Council pursues the course of action least likely to result in a lawsuit
>affecting the council members...her only recommendations will be to pursue the path of\
> least likely litigation.

Council members are immune from legal risk. They have numerous statutes and protections that protect them. Their only risk: in the next elections they'd get booted out.

The City attorney's job is not to represent the welfare and interests of the City's taxpayers. It is instead to protect the "City", esp its City's employees and their actions. Note this doesn't necessarily include the Council members who are immune anyway.

In Los Altos I learned the former Mayor (Jean Mordo) was booted out at the last election as events related to the lawsuit became public. Council member Bruins and her cohort Pepper oversaw and endorsed, through silence or otherwise, the events described in the lawsuit. Both are in the hot seat now (Bruins for racism, Pepper for doing nothing about it) and are termed out this Nov. Former City Attorney Diaz and his colleagues (and his law firm) are defendants in the RICO suit. The private property owner is a defendant as well. A small matter of time before others are added.

Several of the City agents and agencies (including employees, outside legal help, etc.) involved in the events are "no longer working" with the City. Expect more heads to roll.

Those in Palo Alto worried about the turn of affairs at their City Council/Hall involving the City Attorney and Hotel President-AJ Capital may well look into the lawsuits vs the City of Los Altos. They'd find it worth their time and effort and it may help clean up Palo Alto just as it is cleaning up Los Altos.


7 people like this
Posted by chris
a resident of University South
on Jun 24, 2020 at 12:09 pm

Fighting a lawsuit does not create housing. It is just money down the drain to lawyers. That Mooney should be used to create housing.

It is clear that the city has many rules that are incompatible. That is the problem that should be attacked, not an old, dilapidated out-of-code building.


19 people like this
Posted by CommonSense
a resident of Professorville
on Jun 24, 2020 at 12:27 pm

Cowards
End of my opinion!


15 people like this
Posted by CC
a resident of Downtown North
on Jun 24, 2020 at 12:38 pm

The *horror* of a building named Hotel President being used as...a hotel. I cannot imagine a greater tragedy befalling this city than private individuals using their own money to restore a building on its way to dereliction. A travesty, really.


9 people like this
Posted by Resident 1-Adobe Meadows
a resident of Adobe-Meadow
on Jun 24, 2020 at 12:59 pm

Hey - I like that the President Hotel will actually be a hotel. It is cute and trendy. And it is historic. A much needed value for the downtown. Is the city getting grief from the other hotels in the area? Are they the ones that are pushing a POV?
We have some heavy hitters in our little hotel world. They like to charge a lot of money. That awful Hana Haus is connected to the hotel. Can we get rid of that? I have yet to figure out why there is a prime piece of property on University sitting there with no apparent purpose. Maybe we can convert that to a restaurant and bar for the hotel. A place for parties, weddings, events.


22 people like this
Posted by Marie
a resident of South of Midtown
on Jun 24, 2020 at 1:25 pm

If this decision was made in good faith, the council would not have approved a reduction of required parking spaces. Why don't they have to comply with existing laws regarding parking?


20 people like this
Posted by Steve Dabrowski
a resident of Duveneck/St. Francis
on Jun 24, 2020 at 1:31 pm

I believe Stump is one of those attorneys who will never litigate, she always seems to recommend folding our hand at the slightest hint of confrontation. I think we would be just as well off with a paralegal giving advice and a lot better off in our budget.


4 people like this
Posted by Fred Balin
a resident of College Terrace
on Jun 24, 2020 at 2:45 pm

Land Use Process Experts:
There is no ordinance here, rather a waiver from the zoning code, and therefore referendum is not possible, correct?
And are there any future hearings that might result in an option for a referendum, or is this IT on this matter?


21 people like this
Posted by Novelera
a resident of Midtown
on Jun 24, 2020 at 3:18 pm

Thank you, Lydia Kou, for your principled vote. I will definitely be remembering the other cowards in November.


9 people like this
Posted by NextSteps
a resident of Crescent Park
on Jun 24, 2020 at 3:56 pm

> a waiver from the zoning code,
In other words, a VARIANCE.

Exactly right: a VARIANCE is what was required for a Change in Use.  And such a variance application would have required scrutiny and approval by the City, including compliance with other due process e.g., objections or not by adjacent properties, consistency with prior variance applications and their approvals or not, etc.  

Clearly the City exempted AJ Capital from all of that.  
Why?  Apparently "for fear of litigation".
Why any possibility of litigation?  Because City staff represented to and reassured AJ Capital and their agents (who, coincidentally, were employed by the City not too long ago) that the City would support/approve AJ Capital's plans (even though it ran counter to the Code).

Simply put, the Council and City are saying:
a) if we reject the conversion AJ Capital would sue...and we'd have to spend time and effort and money to defend ourselves...and even if we prevail, the voters would not remember or reward us.
b) if we approve the conversion it is less likely the residents and taxpayers would sue and navigate the legal system to have the Courts compel the City to undo the permit.  Plus, in a year or two voters may not care about this decision as it'd be submerged under other issues.  So, guess what, let's take the less risky option (b).

Whether we Palo Altans call this bluff or not is up to us.  
Would be interesting to see who steps up.

p.s. In Los Altos, in a situation very similar, the City issued an illegal permit for the illegal conversion (to a dwelling) of an illegal structure.  Illegal structure, not any compliant with the Code, fire hazard, change in use, no variance sought,...the whole shebang.  The "enterprising" employee who issued the permit lacked the authority to issue it.  The City, upon notice, did not rescind the permit.  They were worried doing so would result in a lawsuit from the owners of the property hosting that structure.  The owners were attorneys and they had been assured by "enterprising" City agents that a permit would be given them.  So the City and its attorneys resorted to all sorts of dubious pretexts and fabrications to justify their unlawful actions.  A neighbor, injured by these shenanigans, sued...and now agents and agencies of the City and the property owner (who benefited...) are defendants in two Federal Court lawsuits which are likely to get bigger by the day.  A matter of time before a jury gets to hear the juicy details...and the press gets to report them...and some level of accountability and transparency results.  


4 people like this
Posted by Fred Balin
a resident of College Terrace
on Jun 24, 2020 at 4:56 pm

What is the time limit, if any, for someone(s) to step up?


23 people like this
Posted by More corruption
a resident of Downtown North
on Jun 24, 2020 at 5:02 pm

" AJ Capital and their agents (who, coincidentally, were employed by the City not too long ago)"

Not just employed. but worked in the *City Manager's office,* they were *colleagues* of the current City Manager and the City Attorney. And Planning Director.

How much conflict of interest is OK with the City Attorney?


7 people like this
Posted by NextSteps
a resident of Crescent Park
on Jun 24, 2020 at 5:35 pm

>What is the time limit, if any, for someone(s) to step up?

Two years, the statute of limitations.
Though not advisable to wait long...best to act quickly, file PRA requests for any and all (relevant) records, engage an attorney, get discovery going in parallel to PRA requests, etc.
An attorney can also advise re filing an injunction to stop the City/AJ from proceeding.


15 people like this
Posted by NextSteps
a resident of Crescent Park
on Jun 24, 2020 at 5:43 pm

Here's a simple step that would expose the magnitude of this problem.

File a PRA request to obtain any and all records of the City concerning applications for Change in Use (of a legal nonconforming structure), the City's actions concerning such applications (whether approval or rejection), etc.
Same for VARIANCE applications for commercial properties. (Ignoring residential for now)

Compare/contrast those records with AJ Capital/President.

If the records show instances where the City unilaterally approved all such applications then their actions wrt AJ Capital/President are consistent with prior practice.

If there are instances where the City rejected such applications the records would show WHY. Those records can then be use to compare-contrast the City's processing of the AJ Capital/President matter. Any inconsistency has to be explained and such explanation has to be found acceptable by a reasonable person, esp a judge or jury. Else the City and AJ Capital would be exposed for chicanery and the responsible individuals brought to public accountability.


2 people like this
Posted by Rebecca Eisenberg
a resident of Old Palo Alto
on Jun 24, 2020 at 8:54 pm

Fred and NextSteps:

The Ellis Act has some 14 or 30-day statutes of limitations that may or may not be applicable here (unlike our city attorney, I'm not about to reject a theory simply because I may not like it).

A more likely route could be filing a writ a mandamus to appeal this ruling, on the grounds that the determination was "capricious and arbitrary" and "lacking in factual basis." That should be more than easy to prove. The City Council was serving in a "quasi-judicial" capacity, and they all admitted vocally that they are not lawyers and they do not understand the law. When asked by multiple people (myself included) for an attorney to represent the interests of the city, or at least to allow speakers on behalf of the public interest to have more time, the council declined, and they also actively cut most speakers off. (Arbitrary and capricious.)

The council also refused to investigate the facts. I had emailed a list of about 30 fact-based questions I requested that they ask AJ and/or the Planning Department, and they asked none -- which did not stop them from making assumptions based on what they wanted AJ to have answered if they did ask. For example, Liz Kniss based her ruling on her factual misunderstanding that converting this building to a hotel was the *only* way to preserve its historic beauty. That is false. The building absolutely could and can be renovated for residential use, as it is zoned. The Council also refused to ask AJ Capital if AJ Capital had received any interest from parties who want to purchase the building, to renovate it historically and release it as residential -- and there is reason to believe that there was interest, that may have resulted in AJ selling at a profit (so, no damages). The city council admitted -- the Mayor several times -- that looking into the facts really wouldn't be relevant because their hands really were tied, too bad, so sad. (Lack of factual basis.)

To one of the posters above who insisted that council members have qualified immunity and thus could not be sued - - that is not always true. In fact, there are several causes of action where city council members can and have been held liable, both civilly and even criminally. As a civil matter, False Claims Act cases name individual government officials, and if a city council member is found liable under the false claims act, they can be liable for millions of dollars. As far as criminal liability goes, in addition to embezzlement, self-dealing, and conflict of interest charges that lead to criminal charges filed against council members, the Brown Act also includes both civil fines and criminal penalties for violation. And, although the Ellis Act differs based on local application, even the Ellis provides for some criminal and civil liabilities for government officials.

So yes, city council members can be held liable.

What is quite ironic in this case, and I don't know this for a fact, but one of the many experienced litigators in our community probably does know more, is that in making such unseemly machinations to force this "awkward" and "unfortunate" result presumably to avoid liability (despite the fact that there is zero examples of anyone being sued for the theories they claimed), the city council now actually may have created liability for themselves and potentially for the city. (So to all who claimed that their unjust judgment served a benefit by avoiding lawsuits - au contraire; there were no causes of action for AJ to make before, and now actually, neighbors and nearby small businesses may have some fairly good causes of action that they would not have had had the city council not broken the law to reach the result they admitted was bad for the community.) (One would think that their attorney at least could have advised them to avoid using the specific words most likely to create liability for themselves, because those were the words they seemed to say most often.)

As one of the commenters above posted articulately and accurately, the city council is placing a bet that noone is going to take the time and effort to follow up with an appeal or a lawsuit.

They may be right, but what a lousy and disrespectful way to treat the people who elected you to office.


2 people like this
Posted by NextSteps
a resident of Crescent Park
on Jun 25, 2020 at 7:13 am

>Writ Mandamus filing...determination was "capricious and arbitrary" and
>"lacking in factual basis." That should be more than easy to prove.
I concur whole heartedly. Records obtained via PRA should reveal whether there was a consistent process, as described in the Code, for variances and Changes in Use and whether prior applications for such were handled in that consistent manner, whether AJ Capital's application was also handled in the SAME consistent manner, etc. Inconsistencies, if any found, would strengthen the argument the City operated in a manner that is "capricious, arbitrary, unequal treatment, etc.". Importantly, those that were disqualified can sue for damages as they were denied benefits granted AJ Capital (and perhaps others).

> because their hands really were tied,
This is a common pretext and excuse for Council members. The Los Altos Council members and (now former) City attorney stated the same excuses: "our hands are tied", "State law....", etc.
Here's how to hoist them on their own petard: a) show other instances where the City reached a different decision. If their hands were indeed tied, wouldn't they be required to reach the same decision always? b) show other instances in other cities where a different decision was made. After all State law applies to all cities in the state and the decisions made (citing that law) should be the same.

I am unaware of the False Claims Act. If indeed it helps hold Council members liable all the better.

>the city council is placing a bet that no-one is going to take the time and effort to follow up >with an appeal or a lawsuit....what a lousy and disrespectful way to treat the people who
>elected you to office.
Most elected to office use their office to deliver benefits and privileges to the few bees (the special interests) that served their interests. The hive (the interests and welfare of the larger community) is ignored and (over time) dies, although a few bees make good.
Once in a while a shock to this system--as in the ongoing litigation in Los Altos, the AJ Capital opportunity in Palo Alto, Watergate at the national level--serves to wake people up, demand accountability, take names...and things get better for some time.


5 people like this
Posted by NextSteps
a resident of Crescent Park
on Jun 25, 2020 at 7:25 am

"the city council is placing a bet that no-one is going to take the time and effort to follow up with an appeal or a lawsuit."

Indeed an appeal would let sunlight in, make public what is otherwise private, compel the City officials to explain their decision with details and facts, invite public scrutiny, etc.

In Los Altos a City agent actually denied a resident their right to appeal on the mere basis "My decision is final, unappeal-able." All this when he didn't even have the authority to issue the permit but did so "because of long familiarity with (the beneficiary and their) property". Needless to say he was fired 2019 but is a prime defendant in the RICO Conspiracy and other lawsuits and has his actions and denial to a Federal Court jury.

Rebecca et al would do well to contact the Los Altos plaintiff/attorneys. There seems much for Palo Alto residents to benefit from the saga in Los Altos.


Posted by Name hidden
a resident of Downtown North

on Jun 25, 2020 at 7:50 am

Due to repeated violations of our Terms of Use, comments from this poster are automatically removed. Why?


2 people like this
Posted by NextSteps
a resident of Crescent Park
on Jun 25, 2020 at 9:02 am

"...The Ellis Act has some 14 or 30-day statutes of limitations "

Let's say you file PRA requests today. The City then dawdles, stonewalls etc. and produces some records 30 days from the date of the filing of the PRA request. They have thus run out the clock on the Ellis Act's statute of limitations--whether it is 14 or 30 days or whatever--and limited you from exercising your rights and options.

In short, whatever the applicable statute of limitations it is incumbent on Palo Altans AND the City to act in a manner that facilitates timely requests for records, their production, their review, and subsequent appeals.

Hence, all the more important to file comprehensive, complete and relevant PRA requests right away. The onus then falls on the City to produce any and all such records in a timely manner allowing for their review and subsequent appeal, all within the operative statute of limitations. Any misstep by the City would only compound their woes.


4 people like this
Posted by Fred Balin
a resident of College Terrace
on Jun 25, 2020 at 9:12 am

Kindly provide parties and/or links to information in the Los Altos case.

Also, since the decision on Monday was made by the city council and there is no "second reading" in this case, the city process is done, yes?, i.e., the decision is not appeal-able to the city and that any next step in regard to the decision would have to pursued via the courts, yes?


19 people like this
Posted by Gnar
a resident of Charleston Gardens
on Jun 25, 2020 at 9:34 am

There's something seriously broken with our City Council. Their responsibility is to be a final check on development projects, not a rubber-stamp on the decision Architectural Review Board, who considers things like colors and swatches, not the impact to a surrounding area.

The City Council has stated to us directly that they have to approve projects, because they are afraid of a lawsuit from a developer if they decline a project that the ARB has approved. That is a total dereliction of duty. In lieu of performing the role we've hired them to do, City Council members are shrugging and leaving it up to who has deeper pockets for lawyers: us or the developers.

City Council: We're watching. And we vote.


4 people like this
Posted by NextSteps
a resident of Crescent Park
on Jun 25, 2020 at 9:43 am

> and/or links to information in the Los Altos case.

The case #s are 5:18-cv-01223-VKD and 5:20-cv-03693.
The documents are publicly available and can be found in the Federal Court's docket.
Alternately you may contact the attorney Bill Cohan directly.

"since the decision on Monday was made by the city council and there is no "second reading" in this case, the city process is done, yes?, i.e., the decision is not appeal-able to the city and that any next step in regard to the decision would have to pursued via the courts, yes?"

The Palo Alto Municipal Code details the process for appealing.
As no appeal has been filed yet I expect the Code to allow the appeal...and the City to have the appeal heard in an independent and timely manner. Should that not be the case then the option is none other than than the Courts (a Writ Mandamus/Declaratory Injunctive Relief seems a first step.)


4 people like this
Posted by Fred Balin
a resident of College Terrace
on Jun 25, 2020 at 10:25 am

Thank you for the Los Altos case info, and …. your view that an appeal to the city can be filed ,…

… therefore, we could have a mirror image of attorney David Lanferman’s filing an appeal in 2017 on behalf of Planning and Transportation Commissioner Michael Alcheck after then-Assistant Planning Director Jonathan Lait’s denial of his applications for conversion of the parking structure on each of his two redeveloped lots into fully-enclosed garages. When the city ignored the appeal requests, Lanferman issued a “demand” i.e., a threat of legal action if approval was not granted, after which the city caved.

Residents can go the same route, i.e., file an appeal, after which, whether it is heard or not, can move to lawsuit, yes?

But there is also a 30-day window to file the appeal, correct?


3 people like this
Posted by Anon
a resident of Evergreen Park
on Jun 25, 2020 at 10:29 am

It's obvious to me President Hotel *should be* a hotel.

It was designed to be a hotel. It can become an iconic attraction for tourists, and is desperately needed to revive downtown business. It generates significant upfront as well as ongoing cash flow for the city, thereby reducing the need to tax us the residents, especially helpful in this economical environment.

Do-gooders please use your own resources. We are in the biggest economic crisis in our lifetime, and must do our best to preserve jobs in our neighborhood, sustain civil services, without increasing taxes.


11 people like this
Posted by NextSteps
a resident of Crescent Park
on Jun 25, 2020 at 10:39 am

"Residents can go the same route, i.e., file an appeal, after which, whether it is heard or not, can move to lawsuit, yes? But there is also a 30-day window to file the appeal, correct?"

I'd be remiss in answering those questions--and whether the Lanferman-Alcheck matter is a mirror image or not--one way or another. I suggest consulting a good attorney. You could also ask the City questions re the appeal process and have them respond, ALL in writing.

Also: Rebecca is mistaken the False Claims Act can be used vs the Council members complicit in this shady deal. The laws and statutes make it very difficult to hold elected representatives accountable (other than at the ballot) and that gives them confidence and the protection to engage in these shenanigans and chicaneries.

As for Anon's posting: " President Hotel *should be* a hotel. It was designed to be a hotel. It can become an iconic attraction for tourists, and is desperately needed to revive downtown business. It generates significant upfront as well as ongoing cash flow for the city,"

Fair and good. Let it be so in complete compliance with the Code as it is and as it has been applied to numerous others in the past (wrt Change in Use, parking, etc.) Not under any other circumstances. Any exemption granted AJ Capital/Hotel President should be made available to ALL others and through time. In other words, no special benefits for AJ/President owing to the "fear of litigation". That said, Anon, are you a shill for AJ and/or those City agents that were complicit in this "special" deal?


9 people like this
Posted by Fred Balin
a resident of College Terrace
on Jun 25, 2020 at 1:05 pm

I can only recall three resident-driven, land-use lawsuits against the city in recent years. Two halted a project for a number of years, but did produce some concessions. The third was abandoned after much research and effort and a conclusion that it could not be won. Folks here may know of other instances.

It takes not only desire, but a significant amount of time and money. I’ll gladly contribute some $$s, but it is something others would have to lead.

Whether that effort comes forward or not, I do believe Palo Alto residents need to hold this city (i.e., planning and legal staff and the city council) accountable for this huge failure on so many levels and at so many stages, beginning with the initial and private meetings with AJ Capital in 2018.

That accountability can occur via a citizen’s initiative directed where it will hit the city the hardest, while also producing mitigation for damages, i.e., via the city’s future revenues from this hotel, if and when it opens.

I am proposing that a citizen’s initiative be drafted and then signed by a sufficient number of Palo Alto registered voters so it can appear on the ballot.

The initiative would require that all transit occupancy tax revenues (i.e., 15.5% on each visitor’s stay) from a future operating Hotel President (formerly Hotel President Apartments) be earmarked for a special fund designated to support low-income housing via optimal mechanisms, selected by the most respected, Palo Alto resident, low-income housing advocates that are not elected or appointed officials or part of any organization subsidized by the city. The timing, amounts, and distribution point(s) of these funds would be under their control, i.e., out of the city’s hands.

The funds, for example, could be used for renter subsidies, legal aid, retrofitting to maintain low-income units, a piggy bank to support new low-income housing and/or any other idea our respected low-income housing advocates agree to.

This a way — not the only way, but certainly one way— in which we can all participate in not only demonstrating our dissatisfaction with Tuesday’s outcome but also embark on a clear, citizen-led and overseen path to help our resident sisters and brothers in need of affordable housing as well as others in similar economic circumstances who may wish to live here.

Thank you.


2 people like this
Posted by Anon
a resident of Evergreen Park
on Jun 25, 2020 at 1:13 pm

"Fair and good. Let it be so in complete compliance with the Code as it is and as it has been applied to numerous others in the past (wrt Change in Use, parking, etc.) Not under any other circumstances."

We are in crisis. Government is handing out billions and billions of forgivable PPP loans. Fed is printing money like crazy. City is short on revenue in biblical proportions. Tens of thousands of people are out of jobs in this area.

And we should hang up on the project because of a few parking lots? Come on, cut some slack. As long as they pay what they promised it is reasonable for city council to make a few concessions that normally it would not make.


3 people like this
Posted by NextSteps
a resident of Crescent Park
on Jun 25, 2020 at 2:14 pm

>It takes not only desire, but a significant amount of time and money.

Yes, I agree, it will take ALL of that. And more.
What's worse: the City and AJ Capital know that too.
Even worse: they are counting on the possibility (fact?) the opposition doesn't have what it takes. And for that precise reason they won't be held accountable. We are complicit too by not standing up and asserting our rights and requiring elected officials and public servants account for their errors of omission and commission. We thus allow them to become part of the fabric of the society we live in.

If the facts support the "partnership" between City officials (current and former) and AJ Capital, and the records show others were denied what AJ was granted, the City and/or AJ would be held liable for the costs of the litigation. That upside comes with the caveat the facts have to support the City's liability. The bad news is: even in such a scenario the City's portion ultimately comes out of the taxpayer's coffers.

Sure, some Council members would get kicked out of their office come the next elections; some City employees would get fired (and go on to consult for the likes of AJ). But they won't pay a penny...and that's how the laws protect them and they know that well!

As for AJ: if the public records show AJ was party to these shenanigans their liability is unlimited...any reasonable attorney would salivate at that possibility...and that alone should keep AJ awake at night. E.g., the private parties ensnared in the Los Altos lawsuits and their agents (attorneys *AND* their law firms included).


7 people like this
Posted by Anon
a resident of Another Palo Alto neighborhood
on Jun 25, 2020 at 2:20 pm

Posted by Anon, a resident of Evergreen Park

>> And we should hang up on the project because of a few parking lots? Come on, cut some slack.

Why? The project violates existing regulations. Why should AJ get to violate the regulations? But, my *real* problem with it is that it doesn't make the jobs/housing imbalance better, it makes it worse. And, somehow, due to the dumb formulas that are being applied today, we residents are punished and penalized because the private sector keeps playing games that make jobs/housing imbalance worse. We have to stop building projects that make the imbalance worse. We residents have to find a way to enforce that.

No project should get approved unless the overall effect is to make jobs/housing imbalance better.


9 people like this
Posted by Rebecca Eisenberg
a resident of Old Palo Alto
on Jun 25, 2020 at 2:34 pm

NextSteps: to clarify, I was NOT saying that any of those causes of action could be used in THIS situation. I am not giving legal advice. I am not a litigator. I do not file lawsuits.

All I was doing was correcting the person who said that council members are immune from lawsuits. I was only pointing out various laws that do provide direct personal liability, either civil and/or criminal, for city council members.

And, I say this as a general matter. There are lots of litigators in this community who would have direct experience with this kind of litigation. (Although I have managed litigation for companies, my experience centers on corporate transactions and commercial and employment negotiation, and compliance. But even in those capacities, I'm not offering legal advice here.)

But back to policy, I very VERY much like Fred Balin's approach. Although the deadline for putting an item on the ballot via signatures may have passed, there may be workarounds, and that might be worth researching. For the record, the issue of ballot initiative deadline was mentioned by at least 4 callers during 2 of the most recent Council Meetings by advocates of Vote16 (another measure that the City Council should have allowed on the ballot). Apparently, advocates from Vote16 had been in touch with the Palo Alto government actively for months, but council members and city staff kept giving them the runaround. By the time they reached a person who responded, they were told that the deadline for putting their initiative on the ballot had passed.

I think that this is something readers should be aware of. These advocates had not asked the City Council to decide whether 16 or 17 year olds should be entitled to vote. All they had asked was for the City to put the same measure on the ballot that was approved for the ballot in several other cities, including San Francisco, Berkeley, iirc Oakland, and several others. There already was a form, approved initiative and all the City Council had to do was let it be on the ballot. But ALL 7 of them chose to ignore this. (Tenaka mentioned it in passing, but did not present the initiative or take any other actions such as make a motion.) This is an extremely important initiative for people concerned about the purging of voter rolls nationally. It is a very important initiative for people who care about education and democracy. Maybe it would pass, maybe it would fail, but there is NO excuse for the City Council to have refused to put it on the ballot. That literally disgusts me. They behaved immorally, unethically, and they willfully took away a decision that the public should have been able to make.

This is what the City Council keeps doing. When it comes to developers, they bend all rules to give these wealthy multi-billion dollar corporations and private equity investment funds whatever the heck they demand, as illegal, illogical, and harmful to our community as those demands may be -- and those demands ARE. But when it comes to the residents, the voters, the actual tax-payers, we don't even get a chance to cast a VOTE on something that is extremely important to us, to our children, and to our quality of life.

The City Council's actions in so irrationally, unethically, and arrogantly insisting that they had some holy "higher imperative" to screw over our city while delivering a 9-figure gift to a bunch of trust fund rich kids in Chicago, was truly one of the most distasteful, corrupt, lazy, and low integrity actions that a local government possibly could have taken. They ADMITTED that this decision harmed the city. They claimed to be "reluctant" about doing this. Yet they said they had to -- to protect THEIR own hides. Remember, when they are saying that they plan to waive-the attorney client confidentiality privilege with Molly, they are admitted that Molly is THEIR lawyer, not ours. So we not only pay for this corrupt council's overpaid city manager (who clearly never listens or responds to one comment from residents - I am still fuming at his insistence that PG&E is not at ALL liable to pay ANY costs for the maintenance of PG&E equipment - yes he said that, in convincing the planning commission to give him $2 million of our money to maintain PG&E equipment last week, the night before the front page above fold WSJ article where PG&E admitted criminal liability for THEIR failure to maintain their equipment - thanks a ton, Planning Commission, are you going to refund us that $2 million?) ... but our taxpayer money also pays for a private "city attorney" who makes 2-3 times what is market for that salary, for her job of keeping the City Council from being sued .... even if those lawsuits were to stem from RESIDENTS. We should not be paying an attorney $600,000/year for the job of fighting against us.

So, I like the idea of ballot initiative, and maybe there is a way to get it on the ballot for November.

And while we are talking about ballot initiatives, I would like to add the following for consideration as well, based on my research of other cities in California who have enacted these types of taxes (and which taxes survived legal challenges)

1. A business receipts tax on Palo Alto-based businesses revenues, only taxing companies that have more than $300 million in revenue, and exempting all retail and restaurant businesses. The tax rate should be 10% for companies with revenues $300M-$1B and 15% on revenues over $1B.

2. A payroll tax on on Palo Alto-based businesses revenues, only taxing companies that have more than $300 million in revenue, and exempting all retail and restaurant businesses, but NOT exempting Palo Alto government positions. The payroll tax exempts all employees who make less than $250,000 annual salary. For salaries between $250,000 and $400,000, the rate will be 10%. For salaries between $400K-$1M, the rate will be 15%. For salaries above $1M, tax will be 20%. (FTR, economic studies on these payroll taxes show that they lead to higher salaries rather than firing highly paid executives. Think , e.g. VC firms in our city).

3. Vote16 - This initiative already is written. This would allow our voters to decide whether they want to allow 16 and 17 year olds to be able to vote in city council (and other city official) elections. (It does not give them this vote - it only lets people decide whether the 16 and 17 YOs should have this vote).

4. Because the City Council refused to consider this one too, I'd like to put a measure on the ballot changing elections where more than one candidate will be elected to an elected roll (generally, city council, and if we can include this too, school board) be done with ranked voting rather than bullet voting, which is how it mostly is now. Ranked voting leads to more democratic results.

5. Ballot initiative: Mayor should be an elected office. This is an executive, not legislative role.

6. Ballot initiative: City Manager should be an elected office.

7. Ballot initiative: City Attorney should be an elected office.

As I mentioned, all of these ballot initiatives have precedent in other cities in California. Most if not all of them also have precedent as successful measures and initiatives both inside and outside of California.

As someone said above, our city government is broken. I did not want to believe that before, but after attending all of the City Council, Planning Commission, and Human Relations Commission meetings held in the past month (and a large number of them before that), I cannot help but reach that conclusion too. To hear so many callers make so many incredibly intelligent, researched, and articulate arguments about literally *every* issue that came before the council (and PTC) and to watch the city council (and PTC) not only reject but actually *ignore* those arguments (in many cases, we would lose a quorum the minute it was time for the community to speak!!) was truly one of the worst experiences in my more than 52 years of life.

I do not understand how an elected official can treat their community so callously. But here is something I do know:

I know that this community in Palo Alto contains some of the most educated, intelligent, international, diverse, hard-working, caring, creative, innovative, inclusive, and kind people around. I know that this community used to have a local government that prioritized community services, that was innovative in government initiatives, that listened and responded to concerns, that prioritized the education of children and the safety of seniors, and that worked hard to make sure that people paid their fair share and ONLY their fare share. That community was home to residential neighborhoods and very few offices. That was the Palo Alto I experienced when I moved here in the mid-1980s.

We in Palo Alto have all the capacity now to do great things that we did then. In fact - given the vast wealth we have here -- especially the vast wealth of the multi-billion-dollar employers and real estate investors who own so much of our land -- we likely have more capacity now than we ever had in the past.

It's that capacity that excites me. If we just made those with the most means, that take so much from us - the real estate speculators like AJ Capital, the huge developers, the multi-billion dollar corporations like HP, Varian, Palantir, and Tesla - if we just made them pay their fair share, we wouldn't have to fight so hard to preserve 75 apartments in President Hotel. If the biggest companies paid ANYTHING, we would not have to have these fights.

We CAN improve things here. And when we do, the future is wide open.


2 people like this
Posted by Fred Balin
a resident of College Terrace
on Jun 25, 2020 at 5:59 pm

Referendum needs:
1. Signatures of 6 percent of registered voters in previous general election: 0.06 x 39,866 = 2,391.
2. City Clerk’s signature of sufficiency, 88 days prior to general election: Nov 2, 2020 - 88 days = August 6.
3. Factor in time to get your ballot language just right and the complications of in-person signature gathering during a pandemic, and it looks really tough get one to fly this time around.

Some things to think about.

Looks like its back to appeal/lawsuit options, to have any kind of near-term impact.




14 people like this
Posted by mjc
a resident of College Terrace
on Jun 25, 2020 at 6:26 pm

We have an election for four council seats this fall. I trust voters who support housing over commercial development will take note of which current council members up for reelection voted at past council meetings to change city codes specifically for the benefit of AJ Capital. Which greased the wheels for AJ Capital to continue to push for approval to convert the building from housing to a hotel.

I also trust voters will take note of which current council members voted this week to continue to support AJ Capital's application to change the building's use from residential to hotel.

Which council members pay lip service to the "we need more housing" mantra while crying crocodile tears but whose real agenda is to vote for commercial development that digs the jobs-housing imbalance hole ever deeper.


15 people like this
Posted by Council needs to remember who put them there.
a resident of Green Acres
on Jun 25, 2020 at 7:28 pm

"AJ Capital and their agents (who, coincidentally, were employed by the City not too long ago)"

This is exactly what happened at the 4256 El Camino site. The faceless investors who bought the property hired Randy Popp to basically lobby the ARB. Guess what? He knew them all because he used to be on the ARB.

Then, when the proposal went to city council, two of their members told me that they couldn't vote "no" on the project, because THEY WERE AFRAID OF A DEVELOPER LAWSUIT.

What is the point of even having these proposals before the city council, if they bend over for crony developers and don't even consider them?

How can you refuse to consider a proposal objectively for the benefit of the residents of the city, out of fear of litigation?

City council, do your damn jobs. You work for us.


Like this comment
Posted by chris
a resident of University South
on Jun 25, 2020 at 9:06 pm

How can a city that many so many highly prescriptive rules that conflict with each other hope to win in court when there are state laws that take precedence?

Some people in Palo Alto seem to prefer litigation over common sense and don't mind throwing millions of dollars for lawyers down the drain. If affordable housing is the goal, these millions of dollars should be spend on housing.


7 people like this
Posted by DTNResident
a resident of Downtown North
on Jun 25, 2020 at 9:40 pm

FYI, the Ellis Act does give the developer the right to evict all of the tenants. The Ellis Act gives the owner of the property the right to stop renting it. The owner, could then move in himself or herself, for example.

The Ellis Act then does not give the developer the right to convert the property from a residential use to an entirely different use. That would be up to local laws, and the 2018 law clearly makes the conversion not permissible. So hiding behind the Ellis Act is just an excuse. Yes, you can file a lawsuit for anything, but they would not have won here.

The last section of the Ellis Act makes this Crystal Clear:

"However, this act is not otherwise intended to do any of the following:

(a) Interfere with local governmental authority over land use, including regulation of the conversion of existing housing to condominiums or other subdivided interests or to other nonresidential use following its withdrawal from rent or lease under this chapter."

Note that may of the sections of the Ellis Act linked below don't apply to Palo Alto, such as those for residential hotels in cities of over 1M people, and cities with rent control. But the right of a landlord to stop renting applies everywhere in the state.

Web Link.


3 people like this
Posted by Mark Weiss
a resident of Downtown North
on Jun 26, 2020 at 1:47 am

I can think of four recent staff members either on the seventh floor or planning who left the city to either work directly for developers and this project AJ capital or are on the approved list on consent this week part of the million dollar farming out of staff work on upcoming projects.
That might be an interesting approach for journalists or activist or candidates to flesh out this phenomenon. It’s corruption.
To what extent is leadership — elected, appointed or paid — responsive to and reflective of We The People?


2 people like this
Posted by rsmithjr
a resident of Duveneck/St. Francis
on Jun 26, 2020 at 12:03 pm

The efforts expended so far on keeping the President a rental property, and the efforts proposed such as having a ballot initiative and other things mentioned here, have one certain effect: they will discourage developers and landlords from coming here.

My guess is that 60% or more of our voters just don't want any more housing, especially not high-density, low-income housing. This group is largely sitting these things out, but are probably pleased at what is happening.

We speak of AJ in terms of showing them that they are not wanted here. I suspect that they know that now. Developers I have talked to in recent years have told me that they build apartment complexes in the central valley but in no way would want to come to the Peninsula.

Developers are like everyone else: they are looking for business opportunities. We are sending the message: don't come here, we don't want you, and we will give you a hard time if you try.

AJ would probably love to have an exit from Palo Alto. If some of you want to buy the President and operate it as low-income housing, you have my sincerest best wishes. You will need a big bankroll for this so be warned.


2 people like this
Posted by Anon
a resident of Another Palo Alto neighborhood
on Jun 26, 2020 at 12:13 pm

Posted by rsmithjr, a resident of Duveneck/St. Francis

>> Developers I have talked to in recent years have told me that they build apartment complexes in the central valley but in no way would want to come to the Peninsula.

The reason that these properties are overpriced is because developers think that they can build high-end everything-- office space, hotels, high-end housing. The land would not be so valuable if they were required to build affordable housing.

>> Developers are like everyone else: they are looking for business opportunities. We are sending the message: don't come here, we don't want you, and we will give you a hard time if you try.

If they want to build office space, then, yes, you are right. Don't come here, we don't want you, we will give you a hard time. We don't need any more office space.

>> AJ would probably love to have an exit from Palo Alto. If some of you want to buy the President and operate it as low-income housing, you have my sincerest best wishes. You will need a big bankroll for this so be warned.

So, they paid too much? Well, it was a gamble. They can write off the loss. I mean, are you expecting us to feel sorry for developers? I can see *them* ROTFL.


Like this comment
Posted by rsmithjr
a resident of Duveneck/St. Francis
on Jun 26, 2020 at 12:57 pm

@Anon,

>>I mean, are you expecting us to feel sorry for developers?

I am not so much sorry for the developers as I think that we need them. Where will the money come to pay for these things? The city is not going to be building low-income housing, and the taxpayers are not going to be interested in funding bond issues for low-income housing.


14 people like this
Posted by Rick
a resident of Downtown North
on Jun 26, 2020 at 1:56 pm

Thank you Lydia Kou for dissenting on this important vote.

Is anyone surprised, anyone at all, that PA city council once again, predictably, and with likely ZERO concessions from the developer, voted for less housing and more basically commercial space?

Can you imagine a Palo City with a thoughtful, coherent, internally consistent zoning ordinance, rather than the practically building-by-building zoning plan that it has now that invites deep pockets to simply by their way to an approval?

How about enforceable ordinances prohibiting all former city employees from advancing or being a party to new development projects in Palo Alto?

How about a city council giving the city attorney enforceable laws?

How about our city attorney?


2 people like this
Posted by Me 2
a resident of Old Palo Alto
on Jun 26, 2020 at 2:40 pm

"The reason that these properties are overpriced is because developers think that they can build high-end everything-- office space, hotels, high-end housing. The land would not be so valuable if they were required to build affordable housing."

No. The main reason why housing is so "overpriced" is because of the restrictions and hoops that people have to go through to build in Palo Alto. It takes lots of $$ to deal with the city and its restrictions. Attorneys, architects and engineers that know the arcane rules of Palo Alto don't work for free. In fact, it's so atrocious here, that they can charge premium.

And it gets always gets worse - just in the last few years, we've added a dewatering restriction (that does nothing for the environment), a anti-demolition rule and a requirement on how to dig basements. All requiring much more expensive building approaches.

[Portion removed.]

Every project, whether it's a remodel in a neighborhood or a large development, is a pain to go through in Palo Alto. And that makes projects hard to pencil out.

So, if you've been pimping these things under the guise of residentialism, but then decry the loss of affordable housing, I'm sorry, but you have to look in the mirror. Don't give me those crocodile tears sitting in your multimillion dollar house (that you probably pad for less than $250K in 1980 or something like that).


4 people like this
Posted by Mark Weiss
a resident of Downtown North
on Jun 26, 2020 at 5:33 pm

Instead of giving away to the out-of-town developers special interest $100 million worth of up zoning as a previous poster noted, at the very least Council could have gotten the capital people to put enough money into the next door varsity theater to turn it back into what many many people had always wanted and which the landlord had promised and which the previous tenant allegedly had already paid for a public house, for live music or film.
[Portion removed.]


11 people like this
Posted by Blackmail
a resident of Old Palo Alto
on Jun 26, 2020 at 6:18 pm

Fear of a lawsuit that zoning can’t be enforced? Probably something else is the motivating factor here.


7 people like this
Posted by mjh
a resident of College Terrace
on Jun 27, 2020 at 12:51 pm

@mark
Closing the Varsity was a huge loss to the character of University Avenue and I still miss it, along Chimera and all the other bookshops. Requiring the AJ Capital to restore the Varsity for public use as you suggest in return for the "upzoning" would have been brilliant. And a plus for hotel guests.

If there was ever a case where connecting the dots might demonstrate a direct line to cozy relationships between some former city hall senior staff, some current city senior employees, and some current and former council members with developers, over the interests of the residential sector, then this appears to be the poster child.


1 person likes this
Posted by Chris
a resident of University South
on Jun 28, 2020 at 8:25 am

Mountain View is building lots of houses. Palo Alto is building lots of excuses.s


8 people like this
Posted by Anon
a resident of Another Palo Alto neighborhood
on Jun 28, 2020 at 7:09 pm

Posted by Chris, a resident of University South

>> Mountain View is building lots of houses. Palo Alto is building lots of excuses.s

"Palo Alto" is not in the business of building houses. That would be the people who own land that is zoned for development. Like the owners of Fry's site. Why don't you ask them why they don't build housing there. It was zoned for housing decades ago. But, you know the answer, right?


Like this comment
Posted by chris
a resident of University South
on Jun 29, 2020 at 7:22 pm

Mountain View is making it attractive for developers to build housing. Palo Alto makes it difficult or impossible to build housing.
Do you really think a developer would build housing at Fry’s /Ventura under the non-sensical rules Palo Alto imposes?

Why does Palo Alto have rules so much stricter than Mountain View? It is elitism, pure and simple.


7 people like this
Posted by Online Name
a resident of Embarcadero Oaks/Leland
on Jun 29, 2020 at 8:35 pm

As Anon said, ask the developers why they're not building housing and why they prefer building offices and hotels? Ask big tech why they keep recruiting more people than can be housed here while they fund the YIMBY parties/candidates?

Maybe also ask why Mountain View has a business tax/fee and PA doesn't and why Mountain View continues its work on rental control and PA doesn't, Ask them both why they keep destroying affordable housing like the Presidents Hotel and several Mountain View "rent controlled" apartment complexes.


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Palo Alto Weekly Holiday Fund

For the last 26 years, the Palo Alto Weekly Holiday Fund has given away more than $7 million to local nonprofits serving children and families. When you make a donation, every dollar is automatically doubled, and 100% of the funds go directly to local programs. It’s a great way to ensure your charitable donations are working at home.

DONATE HERE