Seeking more information regarding traffic impacts and public benefits, the East Palo Alto City Council on Tuesday delayed its vote on a proposed seven-story office development and six-story parking structure at one of the city's major intersections along University Avenue.
The Phase II University Plaza project proposed by The Sobrato Organization would build offices at 2111 University Ave. Sobrato wants a variance from the city's 35% retail space requirement and proposes to lease the city 4,500 square feet of rentable retail space for 20 years. The development, originally planned as an eight-story building, would bring about 815 employees to the area.
The revised project has two options. Option A, which is recommended by the Planning Commission, would have 695 parking spaces and offer 4,500 square feet of ground-floor office retail for use by nonprofit organizations. Option B includes 709 parking spaces and 8,690 square feet of retail space for nonprofits. Option A, at 4,500 square feet, would require a variance from the city. The latter meets the city's 35% retail requirement and does not require a variance.
Each option offers certain public benefits. If the city accepts the 4,500-square-foot retail option, it would receive new restrooms and lighting at nearby Bell Street Park, and Sobrato would forgive a $1 million loan to the city for Hetch Hetchy water-rights purchases from Mountain View. The city would control the ground-floor retail space for 20 years.
If the city rejects the variance and Option A, Sobrato would pursue Option B and select a retailer for the space, which the developer suggested could be used for businesses other than retail, such as law offices. The city would not get new public restrooms or lighting at the park or the $1 million loan forgiveness.
The City Council is taking a cautious approach to the project. Sobrato's Phase I University Plaza development on the south side of University Avenue, across from the proposed development, caused several small, longstanding retailers to leave and they were never replaced.
During the council's review of the Phase I project in March 2017, the developer surprised the council with a last-minute request to drop a good-faith effort to hire 30% of employees from East Palo Alto, as required by the city. Amazon, which was a proposed tenant at the time, said it would not move into the building if the city did not drop the requirement. The council needed to make the decision at that night's meeting and ultimately approved the change. In exchange, the developer agreed to fund and open a small job-counseling and placement center in the ground floor of the parking garage.
Mayor Lisa Gauthier said Tuesday that she didn't want to rush the approval of the Phase II project and wants to make sure the city gets the best deal.
Vice Mayor Regina Wallace-Jones, who participated in the meeting via teleconference from Australia, asked for the council to continue the decision until the project's benefits could be further studied. The city has relatively few buildings that could serve multiple uses, and the proposed project is largely office space.
She was also in favor of analyzing traffic implications of Phase II University Plaza in addition to other planned projects in the city, such as the 2020 Bay Road office complex. Wallace-Jones said the city should look at not just containing traffic but at reducing it.
As part of the project, the developer would pay to move the northbound U.S. Highway 101 entrance on Donohoe Street 30 feet to the east to link up to its driveway. It would also pay for two synchronized traffic signals — at Euclid Street and at the parking-structure exit. The proposal would also change lane striping on the westbound approach to Donohoe Street. A consultant's traffic analysis found the building would generate 1,520 daily trips to and from the building, but with the signal, lane changes and a transportation-demand-management program, the added traffic would have a less-than-significant impact on traffic flows, according to computer models.
Councilman Carlos Romero said he would be happy with a compromise project that would allow the developer to revert back to the eight-story building and give the city 8,690 square feet of flex-space retail for nonprofits and other retail. It could help make up in a small way for the previously lost retail space from other projects. Without the eighth story, the city would lose $301,000 in developer impact fees and $2.2 million in Measure HH funds over 30 years. Those are significant revenues, including earmarked funds for low-income housing, he said.
Councilman Larry Moody recused himself because of his connections with JobTrain, which will be a beneficiary of another Sobrato development. Given Wallace-Jones' absence before the planned vote and Moody's recusal, Gauthier said she was not comfortable deciding on the project with only three council members able to vote. (Wallace-Jones was not able to take part in the vote from Australia.) The council plans to resume its discussion on the project on Dec. 17.