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Palo Alto Online

Publication Date: Friday, January 30, 2002

Board of Contributors: The real victims of Recessionism Board of Contributors: The real victims of Recessionism (January 30, 2002)

by Gerald Brett

A"Times"> panel has been formed to address the crisis faced by those Palo Altans who were especially hard hit by the recent downturn in the economy.

Observers describe the situation hitting certain sensitive sectors as catastrophic. An expression of extreme urgency has come from a high-level professional trained to assist the downtrodden.

"There are people out there crying for help," said depression counselor Dr. Lee Pathe. "I'm a certified crossroads facilitator with decades of experience, but I'm not so callous that I don't weep sometimes."

Of those most desperately needing care, highest concern is being raised for the city's hard-pressed property developers. Their peril is calamitous, stated Pathe, and not just a little bit unfair, especially considering the sacrifices they have made to the community the last few years.

A case in point is a man called "The Builder." He had his name legally changed in the twilight of the1990s, right after purchasing and then demolishing a slew of buildings throughout Palo Alto.

At their height, the new office space he was constructing was projected to garner rents in the range of $8-$10-$12 per square foot.

Dot-com businesses were said to be waiting in line to occupy The Builder's buildings once they got built. And then the crash came, and almost overnight the gold turned to glut.

"Today, they might get $2 or $3, which is a little more than I was paying," said an old tenant of one of the pulled-down buildings who was forced to move out in 1999. Unable to find another affordable site, the dispossessed renter went out of business and is now searching for a job.

Ironically, it was widely reported how The Builder was primarily motivated by his desire to improve Palo Alto communities by removing unsightly buildings and replacing them with beautiful ones.

"Believe me, The Builder wasn't in it for the increased rent money," confirmed an admiring colleague. "How unfitting that he's now stuck with the bill."

For that reason, a grassroots political movement to help The Builder and other hard luck developers has taken root. While little can be done to reverse the downward spiral in office rentals, one suggestion is that the city should designate 20 percent of all available office space as "high rent zones."

"Can't Palo Alto make sure that one in five offices stay unaffordable?" asked an associate of The Builder. "I mean, if we can provide low-cost housing, what's wrong with high-cost offices?"

Cases such as The Builder are notable for their simple, heart-tugging tragedy. For many, these wrenching stories beg the question: How can we believe in a Supreme Being when such office-space rental injustice occurs?

Yet one can only assume that developers know and understand the risk before going into such a noble trade, just like the men and women who treat violent cannibals with bulimia, for example.

But how about the other, less martyr-inclined victims of the current recession? Others are suffering, said Dr. Pathe, not just the unselfish builders who labored to bring Tokyo-level office rents to Palo Alto.

No one should ignore the plight of Palo Alto's struggling residential developers who sweat bullets to build 8,000-square-foot houses on 6,000-square-foot lots, urged Dr. Pathe.

Affectionately referred to as the "Monster Squad," these developers grappled courageously with the aforementioned physical laws. Have you ever tried stuffing old Grandpa Ernie into your child's play chest?

In addition, the huge-house builders must peddle their beefy hovels for two or three times what the market will now bear. And fashion being the fickle weathervane it is, the economic slide has produced a backlash against the grossly colossal dwellings.

Dr. Pathe worries deeply about the stress experienced by developers who dedicated their lives to bringing something splendiferous to the community.

"These guys are brave warriors. They just wanted to prove that even one of Palo Alto's dinky, cramped lots could fit a three-floor, six-bedroom house with four bathrooms, maid quarters, a home-entertainment facility, a work-out room, a conference center, a three-SUV garage and a comfortable office suite," explained Dr. Pathe. "Is that so wrong?"

A Palo Alto resident whose modest two-bedroom house sits beside one of these Queen Mary-sized domiciles appeared sympathetic. "There used to be a nice young family in the house before it was torn down. Counting the new owners SUV's, they could probably sleep six or eight families in there now."

Dr. Pathe has hopes that City Manager Frank Benest will find ways to rescue some of the sacrificial lambs of the slump.

"These are the people that put the 'pow' in Palo Alto," the professional said. "They're homegrown heroes. Let's not forget them."

Gerald Brett is a member of the Weekly's Board of Contributors.


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