Palo Alto's Midtown retail area, suffering from vacant storefronts and sagging fortunes, is about to get a lot of attention from the city.
The Middlefield Road shopping area has been the subject of rumors in the past two months, including talk of Safeway's desire to build a bigger store there. Now, four Palo Alto City Council members are sponsoring a proposal to have a market analysis done of Midtown that would supply some answers about the area's economic potential.
And later this year, Midtown will likely be one of several areas in the city selected by the Comprehensive Plan Advisory Committee for an intensive design study.
Council member Ron Andersen will ask the Council Jan. 24 to have Carol Jansen, the city's manager of economic resources planning, do a market study of Midtown. Council members Micki Schneider, Joe Simitian and Lanie Wheeler are joining Andersen in making the request.
Jansen said the study shouldn't take more than a couple of months.
Andersen said the study should include a look at rents, sales trends, condition of the buildings and intentions and plans of property owners and merchants. "We need to get a sense of what the potential of the area is," Andersen said.
If the Council approves the study, Jansen said she would survey the property owners to determine their long-range plans. "We need to know what is supportable and what isn't," she said. "There's been a ton of inquiries, but it's a neighborhood commercial area, not El Camino Real."
Within the past 18 months Bergmann's Department Store and the Midtown Market have both closed, fueling speculation about the future of those two buildings.
One local real estate broker said that several major chains, including Walgreen's and Long's, have looked at the properties and passed on them. "Those buildings aren't assets," the broker said, "they're detriments. I don't see a long list of tenants who want to come in there."
Part of the problem facing Midtown is that asking rents may be too high, the broker said. The commercial real estate market here has lost between 10 percent and 30 percent of its value in the past few years, the broker added.
Beyond the market study, Andersen said there is also a basic question about Midtown: "What kind of role should the city play in making it work?"
That question will likely get some attention from the Comprehensive Plan Advisory Committee (CPAC), which is a month or so away from picking several areas of the city ripe for change for intensive design study. Nancy Lytle, the city's chief planning official, said Midtown seems to be on the top of everyone's list for that effort.
Schneider, who assumed her Council seat Monday night after her election in November, was the co-chair of CPAC all last year. She said she hopes the economic study and design planning can be coordinated by the city.
"It's a great opportunity for the city," Schneider said. "We need economic vitality in Midtown. I heard that over and over again when I was campaigning."
Midtown has been a major retail area in south Palo Alto since the 1950s. Besides vacant storefronts, the problem now, some people say, is that Midtown still looks like the 1950s. As a retail area, Jansen said, Midtown is in a significant decline.
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