HomeMy WebLinkAboutStaff Report 317-05a non-profit housing organization for development of affordable housing. However, because the
parcel's small size would accommodate only one or two units, staff believes a better use of the
property would be for the City to sell the property and use the proceeds to offset the costs of an
atIordable housing project on a larger site, such as the proposed Alma Street substation site.
The parcel is 5,413 square feet in area, with 50-feet of street frontage on High Street. Staff
looked into the possibility of increasing the size of the City parcel by acquiring the two small
adjacent County-owned pareels; however, the County did not want to dispose of its parcels. Due
to its size, rezoning the parcel to RM-15 (Low Density Multiple-Family Residential) or RM-30
(Medium Density Multiple-Family Residential) to conform to the adjacent zoning would allow
development with only one residential unit. Under RMD (Two Unit Multiple Family Residence)
zoning, the parcel would meet the minimum lot size of 5,000 square feet, and either one or two
units would be permitted, provided that in the case of two units, both are under the saine
ownership. Therefore, following Council approval declaring the parcel surplus, staff proposes to
process an application to rezone the property to RMD in order to permit two units and to produce
the maximum return for the City.
In accordance with Government Code Section 54222, which requires the City to notify certain
public agencies of its intent to dispose of surplus property, staff has notified the following
agencies about the High Street property: Palo Alto Unified School District; Housing Authority of
Santa Clara County; Santa Clara County Parks and Recreation Department; Mid Peninsula Open
Space District; and the Palo Alto Housing Corporation. No agency has responded that it had any
need for the land.
Based on its underutilization and its potential to produce a return for the City, staff is
recommending that Council declare the High Street parcel surplus and direct staff to proceed
with the necessary steps to sell the parcel. Funds from the sale will be used towards the cost of
the development of the Alma Street Substation site.
RESOURCE IMPACT
. When it returns to Council with the Request for Bid Proposals, staff will recommend a minimum
bid for the High Street parcel based on an appraisal of its market value as a multi-family
residential lot. Staff estimates a minimum bid of approximately $450,000. Oral bidding will
begin at 5 percent above the highest written bid received. If approved by Council, the net sales
proceeds from the sale could be deposited in the Residential Housing Fund to be used to offset
the costs of the proposed development of the Alma Street Substation site for affordable housing.
POLICY IMPLICATIONS
In accordance with the City'S Asset Management policy, staff periodically reviews City-owned
property to assure it is being utilized to its highest return and to identify potential surplus
property no longer needed for City/public use. Once declared surplus, property is disposed of in
accordance with the City policy for sale of real property, the general steps of which are outlined
below. In accordance with Government Code Section 54222, staff has notified the required'
agencies of the High Street property.
CMR:149:05 Page 2 of3
\
ATTACHMENT 2
Tuesday, June 7, 2005
Bill,
We have had no luck in contacting the owners of the two apartment buildings adjacent to the City
owned piece of land' at Colorado and High. We even asked Keith Suddjian, a broker at Cornish
and Carey Commercial that we have worked with in the past, to try to get some response. He was
not successful either. He did advise that the going rate to purchase the properties, given a willing
seller, would be about $1.7 million and $1.4 million with a range for both between $2.8 and 3.2
million. We find that to be an excessive amount to pay for properties that we would eventually
wish to demolish in order to have land for new construction. The location is not desirable in its
present neighborhood state. Winning financing competitions requires neighborhood amenities
that are not present there. We feel that the small City parcel would be the tail wagging the dog
and not enough of an incentive make it work.
I believe there are other opportunities out there that would be more productive to pursue. Let me
know if you wish more analysis or something for your report back to the Council Finance
Committee.
Marlene H. Prendergast
Executive Director, Palo Alto Housing Corporation
650-321-9709 x13
650-321-4341 FAX
mprendergast@paloaltohousingcorp. org
ATTACHMENT 3
Thursday, June 30, 2005
Bill:
After a careful evaluation of the maps you sent out the Housing Authority
has concluded that it is not feasible to develop an affordable housing
project on the sites in question for the following reasons:
1. The lots are very small for any type of meaningful affordable housing
project with a unit count that permits economies of scale in development
2. Combining the lots will result in a narrow and fragmented parcel
(especially taking into account the required setbacks per code) posing a
constraint on efficient design and site planning. Only the City site has
street frontage that allows for access to the combined sites.
4. The shape of the combined lot will also pose layout challenges
3 .. Parking will be an issue·
4. The site is not located within convenient walking distance to amenities
5. Not enough area for construction staging.
For all of the above reasons we do not believe these sites are amenable for
an affordable housing development.
As an aside, the Opportunity Center site at 150·ft. x 120 ft. is in itself a
very tight and difficult site to develop with significant construction
staging challenges. As you know, we are building a 5 storey. structure with
two additional levels of underground parking for a total of 89 units. The
time and effort required to piece together financing for a very small site
that may be able to house 10 to 15 units at best is not feasible.
Please call me if you have any questions.
Thanks
Smitha Seshadri
Housing Authority, County of Santa Clara