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2002-10-07 City Council (4)
TO: FROM: City of Palo Alto C ty Manager’s Rep8 HONORABLE CITY COUNCIL CITY MANAGER DEPARTMENT: Planning and Community Environment CMR: 410:02 DATE: SUBJECT: October 7, 2002 SOUTH OF FOREST COORDINATED AREA PLAN, PHASE 2 REPORT IN BRIEF This City Manager’s Report forwards two sets of recommendations regarding the South of Forest Coordinated Area Plan, Phase 2 to the City Council for its review and consideration. The South of Forest Area (SOFA) includes the nine blocks bounded by Forest Avenue, Addison Avenue, Alma Street and Ramona Street. One set of recommendations is from the SOFA Working Group who met diligently for over two years to develop a vision statement, goals and .policies, compatibility requirements, design guidelines, development standards, performance standards and review procedures for the area. The other set of recommendations is from the Planning and Transportation Commission (PTC) who spent a considerable amount of time reviewing~ the Working Group recommendations and modifying them where the PTC believed it was necessary to respond to additional economic data and other information submitted during the public hearing process. There are many areas of agreement between the two sets of recommendations including: the vision for the area and the desire to preserve and enhance the eclectic, walkable character of the area; the need to develop strong historic preservation requirements; the need to develop a transfer of development rights (TDR) program; and the need to establish limitations on new office use. There are also differences between the two sets of recommendations, primarily found in the development standards, which will impact how the vision for the area is implemented. The differences include: floor area ratio (FAR); height; parking standards; type of office CMR:410:02 Page 1 of !7 limitations; whether planned community (PC) zones should be allowed; and how to address nonconforming uses. All of these similarities and differences are presented in the City Manager’s Report (CMR), No. 410:02. The City Council is not being asked to take action on October 7, 2002. Staff recommends that the City Council review the materials attached to CMR No. 410:02, open the public hearing and accept public testimony, provide input regarding additional information that may be needed, outline questions that need to be addressed prior to final action, and continue the item to November 18, 2002 for final discussion and action. RECOMMENDATION Staff recommends that the City Council review the attached materials regarding Phase 2 of the South of Forest Area (SOFA) Coordinated Area Plan (CAP), open the public hearing and accept public testimony, provide input regarding any.additional information that may be needed, outline questions that need to be addressed prior to final action, and continue the item to November 18, 2002 for final discussion and action. BACKGROUND Phase 2 of the SOFA CAP includes the nine blocks bounded by Forest Avenue, Addison Avenue, Ahna Street and Ramona Street. There are approximately 26 acres of land within this nine-block area developed with service, retail, small office, and multiple and single family uses. The coordinated area plan process was created in 1997 with the passage of Ordinance No. 4626, which established the purposes, procedures and content of a CAP (see Attachment E). Generally, the purpose of a CAP is to provide opportunities for building .a sense of community through public involvement in planning processes and to provide residents, business and property owners with early, meaningful opportunities to help shape the physical components of their, neighborhoods and community~ In addition to the Ordinance establishing the purpose, procedure and content of coordinated area plans, in 1997 the City Council also adopted a Policy Framework for the first such Plan, the Palo Alto Medical Foundation (PAMF)/SOFA CAP (see Attachment F). The PAMF/SOFA Policy Framework established goals and objectives for the SOFA Plan and the planning process. Goals and objectives for the Plan included: promoting high quality design, which is in scale and compatible with the surrounding area; preserving and enhancing the mixed use character of the area; verifying the economic feasibility of the Plan; reinforcing the walkability of the neighborhood; evaluating and reducing the traffic impacts and speeds in the area; considering and using transit and bicycle accessibility to further the goals of the Plan; providing the opportunity for significant housing in the area; encouraging historic preservation; clarifying the CMR:410:02 Page 2 of 17 relationship to downtown; preserving the automobile services and other service uses, as well as trees and community facilities in the area. Goals and objectives for the planning process included: creating a Working Group and defining its role in the process; developing an array of products to be included in the final Plan including land uses, maps, parcel configuration, infrastructure improvements, and design guidelines; developing a feasibility analysis; conducting environmental review; developing an implementation program; completing the process within a specified period of time; and creating a process for project review upon adoption of the CAP. The Worldng Group for SOFA Phase 2 has worked diligently for more than two years to put together recommendations for the area. Although there are a variety of opinions about the specifics of the development standards, the Working Group has accomplished its task of bringing forth a set of goals, policies and standards for the area. DISCUSSION There are two plans in front of the City Council for review and discussion. One includes the. Worldng Group recommendations and one includes the Planning and Transportation Commission (PTC) recommendations. Staff concurs with the PTC recommendations. Both plans address the same topic areas. There are notable similarities between the plans regarding the vision and the goals and policies for the area including: the desire to preserve and enhance the eclectic, walkable character of the area; the need to develop strong historic preservation requirements; the need to develop a transfer of development rights (TDR) program; and the need to establish limitations on new office use. Each of these areas of similarity and agreement is discussed below. There are also differences between the two plans, which are primarily found within the Development Standards section of the documents (Chapter 5 of each document). The differences include: floor area ratio (FAR); height; parldng standards; type of office limitations; whether planned community (PC) zones should be allowed; and how to address nonconforming uses. Each of these areas of divergence is discussed below. The two plans are in different formats because the Worldng Group plan was produced first and before the PTC had decided upon the new format for the zoning ordinance. The PTC plan is in the format that has been selected for the new zoning ordinance so that it will be consistent with the zoning ordinance when it is approved. If the City Council approves some or all of the Working Group recommendations, those recommendations will be put into the new format and the PTC recommendations will be removed. Drafts of the resolutions and ordinances that will be required for approval of the SOFA Phase 2 CAP are attached for review and comment (see Attachments A, B and C). CMR:410:02 Page 3 of 17 Areas of Agreement Between the Two Sets of Recommendations: VisionStatement: The Working Group and PTC share the same vision for the SOFA Phase 2 area. It is one that includes: preserving and enhancing the pedestrian scale; enhancing the neighborhood-serving character of the area; supporting physica! change provided that ¯ new buildings and additions are compatible and complement the character of existing buildings; increasing housing opportunities; ~preserving the existing quiet, calm streets; and supporting mixed-use projects. Historic Preservation: The Working Group and PTC also share the same goals regarding historic preservation in the area. SOFA 2 establishes goals and policies that protect all historic resources that are identified as SOFA 2 historic resources as well as structures that are eligible for either the State or National Register of Historic Places. The PTC recommendations contain specific implementing provisions preventing demolition or relocation of historic structures. Both the Working Group and PTC include a compatibility requirement in the CAP that requires all structures to be compatible with the existing area by taking into account the following characteristics of the street and area: 1) 2) 4) 5) ~) Siting, scale, massing, materials; Rhythmic pattern of the street established by the general width of the buildings .and the spacing between them; The pattern of roof lines and projections; The sizes, proportions and orientations of windows, bays and doorways; The location and treatment of doorways and entries; The shadow patterns from massing and decorative features; and The treatment of landscaping. In addition, all buildings near or adjacent to historic resources must be compatible with the scale and massing of such historic buildings. The structures that are either near or adjacent to historic buildings represent about 75% of all buildings in the area and any modifications or additions to them would be reviewed by the joint Historic Resources Board (HRB)/Architectural Review Board (ARB) board and evaluated in accordance with the compatibility standard and other relevant development standards in the district. Staff recommends one addition to the historic preservation policies and standards that neither the Working Group nor the PTC had an opportunity to review or discuss. The addition would allow the City Council to determine in limited cases that an historic resource that is only eligible for the State list of historic places could be demolished or relocated if it is the City Council’s determination that the removal of the resource would not have a significant effect on the achievement of the historic purposes of the CAP. Any CMR:410:02 Page 4 of 17 historic structure, including those eligible for the National Register, could be removed if the City Council determines that under the historic designation, taking into account the current market value, the value of transferable development rights, an’d the costs of rehabilitation to meet the requirements of the building code or other city, state or federal laws, the property retains no reasonable economic use, or if the Chief Building Official finds an imminent threat to safety if the building is not torn down. These exceptions are modeled after the exceptions permitted for historic structures in the downtown area in accordance with Chapter 16.49.060 (a) of the Palo Alto Municipal Code (PAMC). Staff is recommending that these modifications be considered so that the City Council retains authority over unique situations involving historic resources. Historic Bonus: The Working Group and the PTC recommendations both include a historic bonus for historic .buildings in the Residential Transition Districts that are undergoing rehabilitation. There is a minor difference between the two sets Of recommendations regarding how much square footage could be obtained through the bonus. The Working Group recommends a bonus up to 25% of the building square footage if retail or personal service-oriented uses are to be located within the building or one-tenth of the building square footage if non-retail commercial uses are to be located within the building. The PTC recommends that the historic bonus either be 2,500 square feet or 25% of the existing building square footage, whichever is greater, and all of the square footage would be required to be in residential use. In the Working Group recommendations, the non-residential square footage would be counted toward the 350,000 square foot limit on development in the downtown monitoring area as specified in the Comprehensive Plan. This requirement would not be applicable to the PTC recommendations since the bonus square footage would be required to be in residential use and residential square footage is not counted inthe 350,000 square foot limit downtown. In both sets of recommendations, the bonus square footage would not be counted toward the FAR on the site and parking would not be required. In both sets of recommendations, bonus square footage used on an historic site would be required to conform to the Secretary of the Interior’s Standards for Historic Rehabilitation. Also in both sets of recommendations, a building already in excess of the maximum FAR could be allowed to obtain a floor area bonus in the same manner as historic resources that do not already exceed the allowable FAR. In both sets of recommendations, the bonus square footage may also be transferred off the site as described in the Transfer of Development Rights (TDR) section below. Seismic Bonus: The Working Group recommendations and the PTC recommendations both include a seismic bonus for buildings in the Residential Transition Districts that are on the City of Palo Alto Seismic Category list and that are undergoing seismic rehabilitation. In both CMR:410:02 Page 5 of 17 sets of recommendations, the seismic bonus could either be 2,500 square feet or 25% of the existing building square footage, whichever is greater. Sites that use the seismic bonus square footage on site are not required to provide parking for the bonus square footage On the site. In both sets of recommendations the bonus square footage must be in residential use. In the Working Group recommendation, the seismic bonus must be used on site and could not be transferred and could not be used for buildings that are demolished and replaced with new buildings. In the PTC recommendation, the seismic bonus would not be available to buildings that already exceed 1.5 FAR in the RT-35 district or 2.0 FAR in the RT-50 district and would not be available for buildings that are demolished and replaced with new buildings. The PTC recommendation does permit the seismic bonus to. be transferred as described in the TDR section below. TDR: Both the Working Group and PTC recommendations include a TDR program. While the TDR program is modeled after the existing downtown TDR program, it has characteristics that are unique to the SOFA Phase 2 area. Like the downtown program, the proposed SOFA TDR program would only allow bonus square footage, not base FAR, to be transferred off-site and it can only be transferred to eligible receiver sites. Again like the downtown program, historic resources would not be acceptable receiver sites either in the SOFA 2 area or in other areas downtown. The Working Group recommendations only allow historic bonus square footage to be transferred off-site. Seismic bonus square footage would not be available for transfer. The PTC recommendations allow for both historic and seismic bonus square footage to be transferred off-site to eligible receiver sites inthe SOFA areas (1 or 2) or the downtown. In both the Worldng Group and PTC recommendations, an eligible receiver site would not be allowed to accept transferred square footage that would result in the maximum FAR of the district being exceeded on the receiver site. In addition, in the PTC recommendation, parking would not bd required on the receiver site for the first 5,000 square feet of transferred square footage. Any additional transferred square footage would be required to provide parldng for that square footage on the receiver, site. In the Working Group recorrnnendation, any transferred square footage would be required to provide, parking on the receiver site or the transferred square footage in accordance with Chapter 18.83 of the PAMC. In both sets of recommendations, square footage transferred to an eligible receiver site outside of the SOFA 2 area would be subject to the parldng requirements in place on the receiver site. CMR:410:02 Page 6 of 17 Office Limitations: Both the Working Group and the PTC recommendations call for limitations on new office use. The approaches for limiting new offices are different and are summarized below under recommendations that differ between the two plans. Review Process: In both the Working Group recommendations and the PTC recommendations, the review process would entail ARB review for all non-historic sites that are neither adjacent to nor across the street from an historic site. All historic sites would be reviewed by a joint HRB/ARB board as would all non-historic sites that are either adjacent to or across the street from an historic site. Both the ARB and joint HRB/ARB board would be advisory to the Director of Planning and Community Environment. Minor projects could be reviewed at a staff level and then acted upon by the Director of Planning and Community Environment. Areas of Difference Between the Two Sets of Recommendations: Floor Area Ratio (FAR): The Working Group recommends that the entire nine-block area of SOFA 2 have a maximum FAR of 1.15:1 and that the commercial square footage be limited to 0.4:1 with the remaining 0.75:1 FAR in residential use. This recommendation is reflected on Map 7 in the Working Group Plan. This recommended FAR provides an increase over the 1.0:1 FAR allowed currently in the CD-S zoning district. The PTC recommends that most of the area have an FAR of 1., 15:1, but that a portion of the area along the west side of High Street and the east side of Alma Street have an FAR of 1.5:1 (ending mid-block on both Alma and High Streets). This recommendation is reflected in Appendix A of the PTC plan. The higher FAR’s are recommended to encourage more mixed-use projects and because bigger buildings can be accormnodated along wider, busier streets such as Alma Street. Consistent with the Worldng Group recommendation, the PTC recommendation includes a limitation on commercial square footage of .4:1, with the remaining 1.10:1 FAR in residential use. It should be noted that underground and partially submerged (podium) parldng that is less than four feet above grade is not counted as floor area in either the Working Group or the PTC recommendations. Not including parking in the FAR calculation when the parking is essentially invisible and does not add bulk or mass to a building provides greater design flexibility and greater incentive to provide underground or podium parking rather than surface parking. CMR:410:02 Page 7 of 17 Height and Daylight Plane: The Working Group recommends a 35-foot height limit in most of the SOFA 2 area for compatibility with the height of existing structures. The Worldng Group also recommends greater heights, up to 50 feet, along the east side of Alma Street and a small section of the west side of High Street, ilnmediately north and south of Forest Avenue, as shown on Map 7 in the Working Group plan, because the wider busier streets canvisually accommodate taller buildings. The Working Group did not address daylight planes or encroachments into those daylight planes. The Working Group recommends measuring the height of the building to the midpoint of a sloped roof and to the top of a flat or mansard roof. The PTC recommendations include 35 foot height limits in the RT-35 district, which also has an FAR of 1.15:1 and 50 foot height limits in the RT-50 district, which has higher FAR’s of 1.5:1 as shown in Appendix A of the PTC recommended plan. In addition, the PTC recommendations include daylight planes, or stepbacks, along High Street and the two lots on the south side of Homer Avenue at Alma Street, to help ensure the compatibility of new buildings with the existing character of Homer Avenue and to minimize impacts of new buildings along the west side of High Street on existing buildings along the east side of High Street. Encroachments would be allowed into these daylight planes or stepbacks as recommended by the appropriate review board and then approved by the Director of Planning and Community Environment. The PTC recommendations include measuring the height of a building to the midpoint of a sloped or mansard roof and to the top of a flat roof, which is consistent with the definition of height for commercial and industrial buildings in the current zoning ordinance (Chapter 18.04 of the PAMC). Parking: The Working Group recommends that all new development or additions to existing development provide on-site parking in accordance with the existing parking requirements in Chapter 18.83 of the PAMC. The Working Group believes that an existing parking shortage in the area would be exacerbated by a reduced parldng requirement. The PTC recommendations include a reduced parking requirement when transportation demand management (TDM) programs, including car share and transit pass. options, are incorporated into a development proposal and will be implemented for the life of the project. The PTC believes the reduction is justified by the area’s proximity tO the train station and other public transit and by the requirement for TDM programs to be incorporated into the on-going operations of a project. CMR:410:02 Page 8 of 17 As noted above in the FAR discussion, parldng that is either fully underground or partially submerged but not more than four feet above grade, is not considered floor area and therefore not included in the FAR calculation. This allows greater design flexibility and is an incentive to provide fully or partially underground parldng rather than surface level parldng. There is also further discussion of this issue in the section below entitled "Development Prototypes." Planned Community Zone Districts (PC): The Working Group recommendations include a prohibition on PC’s in the SOFA 2 area. This recommendation is intended to help ensure predictability for property owners within the area and neighborhood residents within and adjacent to the area. The Worldng Group believes that PC zones provide flexibility that is not always consistently regulated by the City and can result in Sites, buildings and uses that are out of character with the surrounding area. The PTC recommendations include controlled use of PC zones in both the RT-35 and RT-50 districts. The FAR in the RT-35 and RT-50 districts could be increased to 1.5:1 and 2.0:1, respectively, if certain public benefits are provided as part of the project. The public benefits would be clearly defined and could include the provision of: 20% below market rate units; substantial public parking; child care facilities; well-designed public gathering space; and space for community and non-profit groups to meet for either free or at a below market rate rent. At least one of these public benefits would be required for approval of a PC in the RT-35 district and at least two of them would be required for approval of a PC in the RT-50 district. PCs could not be used to alter height limitations. Approach to Limiting New Offices: Although both the Working Group and the PTC have recommended limitations on new office use, the recommendations differ. The Working Group recommends that no new office be allowed on the ground floor along Homer Avenue and Emerson Street because these two streets comprise the neighborhood-serving retail and service core of the SOFA 2 area. In addition, the Working Group recommends prohibiting new general business offices on the ground floor .anywhere south of Homer Avenue. The Working Group recommendations would not prohibit new ground floor medical and professional offices south of Homer Avenue. The Working Group also recommends that anywhere office is allowed, that it be limited to 2,500 square feet on the ground floor, with the remaining 2,500 to be located above ground level. The PTC recommendation did not prohibit new office use on the ground floor of Homer Avenue or Emerson Street. or other streets within the area, but did limit office size and location. The PTC recommends that the total amount of new office square footage be limited to 25% of the allowed .4:1 commercial FAR on a site up to a maximum of 2,500 CMR:410:02 Page 9 of 17 square feet, all of which could be on the ground floor but could not be street facing and would require a design that is easily convertible to retail, personal service or other permitted uses. Nonconforming Uses: After a brief discussion, the Worldng Group recommended that the existing nonconforming use provisions in Chapter 18.94 of the PAMC be continued in the SOFA 2 area. These provisions state that an existing nonconforming use can continue to operate as long as it does not expand, become more nonconforming in any manner or is not vacant for more than 12 months. If a nonconforming use ceases operations for 12 months or longer, the use that locates within the building must be a conforming use. The building or individual space could not return to a nonconforming use in the future. The PTC recommendation would allow an existing nonconforming use to cease operation and be replaced with a conforming, use and then revert back to the nonconforming use should the conforming use be unsuccessful. These use changes could occur throughout the life of the existing building. This is a departure from the existing nonconforming regulations in the zoning ordinance and is considered a way of encouraging a conforming use to replace a nonconforming use without the risk of losing the option of putting a nonconforming use back in the building. These differences are summarized in the attached Chart entitled "SOFA 2 Discussion Topics" (see Attachment G). Development Prototypes: During the Worldng Group discussion of its initial recommendations, the City hired the urban design firm Freedman, Tung, and Bottomley (FTB) to create prototypes of the projects that could be built using the development standards and design guidelines being considered. Twelve prototypes were produced, six fora "small" site of 10,500 square feet and six for a "large" site of 26,250 square feet. For both the small and large sites, a prototype was produced which showed: 1) an FAR of 1.15 with a standard parldng requirement in accordance with Chapter 18.83 of the PAMC; 2) an FAR of 1.15 with a reduced parking rate; 3) an FAR of 1.5 with standard parking; 4) an FAR of 1.5 with reduced parking; 5) an FAR of 2.5 with standard parking, and 6) an FAR of 2.5 with reduced parking (see Attachment I). The prototypes showed that while a building with an FAR of 1.15:1 could physically fit on a 10,500 square foot site, it was virtually impossible to also provide the standard number of parking spaces for this square footage on site. The prototypes also showed that a 10,500 square foot site with an FAR of 1.15 and the reduced parldng rate could provide the full floor area on the site and the parking if the parking were either fully underground or partially submerged. The prototypes further showed that a 10,500 square foot site CMR:410:02 Page 10 of 17 could accommodate a building with a 1.5 FAR and a reduced parking rate if the parldng were located entirely or partially underground but could not accommodate a 1.5 FAR with standard parldng. A small site could not accommodate a 2.5 FAR and either standard or reduced parking. Larger sites could accommodate an FAR of 1.15, 1.5 or 2.5 and either standard or reduced parking if the parking was either entirely or partially below grade. The prototypes also showed that the initial recommendation of permitting 2,500 square feet of office on the ground floor and requiring the remaining 2,500 square feet to be located above the ground floor could result in difficult design issues. It would essentially require office and residential uses to be located together on the second floor, which is difficult given the different needs of these two uses in terms of interior ceiling heights, interstitial space requirelnents, and floor plans. A discussion amongst the Working Group and staff about the difficulties of providing on- site parking along with the aclcnowledgment that the area is within walking distance of a maj or transit facility led staff to recommend a reduced parking requirement. The reduced requirement would: permit lower ratios for residential uses if transportation demand management (TDM) programs were put in place; exempt the first 1,000 square feet of retail use on all sites from any parking requirement; and require less parking for other commercial uses than would ordinarily be required under standard regulations found in Chapter 18.83 of the PAMC. The Working Group did not support the reduced parldng alternative and voted to continue to recommend the standard parldng requirement found in Chapter 18.83 of the PAMC. The development of the prototypes also reinforced staff support for continuing to allow PC applications, but in a more predictable and regulated form. It became apparent upon review of the prototypes that more housing could be added to the area more quickly if limited amounts of additional floor area could be obtained through the PC process..That additional floor area would be required to be in residential use. A list of public benefits would be provided and the developer could choose which ones to include in the proposed project. Economic Analysis: When the draft Working Group plan was presented to PTC in May 2002, the Commission had an extensive discussion about the economic feasibility of the Plan. The PTC was in agreement with the goals and policies of the Working Group plan and wanted verification that the ~devel0pment standards .included in the Working Group plan would be economically feasible and the goals for the area could be achieved. The City commissioned Bay Area Economics (BAE) to conduct an economic analysis of the development standards in the Worldng Group plan, using the Freedman, Tung and CMR:410:02 Page 11 of17 Bottomley prototypes as the basis for the analysis. For each of the twelve prototypes, BAE estimated the resulting residual land value. In addition, BAE conducted a very limited retail study including an analysis of the viability of retail uses within specific corridors of the area. The focus of the overall analysis was on the development standards and prototypes and whether or not the resulting development would be economically feasible for a developer. The study was not intended to be a detailed retail market analysis (see Attachment J, BAE Economic Analysis). The BAE study concluded that on a small site, a 1.15 FAR with either standard or reduced parking would not provide sufficient incentive to redevelop the site. A 1.5 FAR with reduced parking requirements on a small site would provide sufficient incentive to redevelop the site with a marginal increase of one percent to the project value. The development that would occur would likely be condominium projects and not mixed-use projects because of .the higher parking requirements for service, retail and office uses. The study concluded that the public benefit that would be required to attain the 1.5 FAR would likely eliminate the site’s economic feasibility. The BAE study also concluded that a FAR of 1.15, 1.5 or 2.5 with standard or reduced parking would be economically feasible on the large site. This was primarily due to greater site efficiencies and economies of scale. The BAE study further concluded that limiting new office use in the entire SOFA 2 area could deter mixed-use projects. More all-residential projects would be the likely outcome of severely limiting new office use. Alternatively, limiting new office use in areas such as along Homer Avenue and Emerson Street that are already more conducive to retail and other permitted uses would be less likely to result in as many all-residential projects and would.result in more mixed-use projects. Several property owners in the SOFA 2 area disputed the results of the BAE analysis and hired the Sedway Group to conduct an analysis of the retail provisions in the Working. Group plan (see Attachment K). The Sedway study concludes that the SOFA 2 area would have as much as 94,000 square feet more retail space than there is pedestrian- oriented demand for such space. The Sedway study further states that the existing 72,500 square feet of retail space in the area meets the estimated 75,300 square feet of pedestrian-oriented retail demand. However, the assumptions the Sedway study uses to reach the above conclusions are incorrect. The study assumes that all existing retail space will be retained as retail space, all ground floor office space will be converted to retail use and that all existing automotive sites will be redeveloped as retail space. Neither the Working Group recommendations nor the PTC recommendations require that all this space eventually become retail. Existing retail space could remain or convert to another permitted use CMR:410:02 Page 12 of 17 without restriction. Those uses include:, restaurants; general business services; personal services; day care facilities; and convalescent facilities. Neither the Working Group recommendations nor the PTC recommendations require existing office uses to convert to retail uses when theoffice vacates the site. The Working Group recommendations state that nonconforming uses can continue as long as they are not vacated for a year or more. If a noncOnforming use is vacated for a year or more, a conforming use must locate within the space, but it does not have to be a retail use. It could be any of the other conforming uses listed above. The PTC recormnendations would allow the vacated space to become any conforming use and then revert back to the nonconforming use at any time. Similarly, neither Working Group recommendations nor PTC recommendations require automotive services to convert to retail use. If an automotive service vacates a site, the site can convert to any of the permitted uses listed above. Given the Sedway Group’s misunderstanding of the Working Group and PTC recommendations, it is likely that the amount of projected retail space is greatly overestimated and that the conclusions based on those proj ecti0ns are inaccurate. Some property owners raised additional concerns regarding the analysis of the large site and the economic feasibility of the various prototypes for that site. There was concern that the large site is owned by the City of Palo Alto and therefore does not represent a typical situation in that the costs of acquiring the site would not be the same as the costs of acquiring other privately owned property. BAE provided additional information. confirming the original conclusions and summarized those basic conclusions as follows: o If the City supports an increase in the allowable FAR in the SOFA 2 area to 1.1.5 or above and allows reduced parking standards, the City will be making development within the SOFA 2 area more economically attractive than it is under current zoning regulations; and Generally, with all other factors being held constant, as the allowable FAR increases, there is more incentive for redevelopment in the area; and If the City allows-development similar to the prototype defined for the large site at an FAR of 1.15 with reduced parking, a prospective developer should be able to pay a property owner a market value for his/her land that is in line with current multifamily residential and commercial property values, as reported in the City’s Housing Element of the Comprehensive Plan. The full text of the additional information and response to some property owner concerns is included in Attachment R. Based on BAE’s additional analysis the Planning and Transportation Commission and staff believe the recommendations found in the PTC plan are economically viable. CMR:410:02 Page 13 of 17 REVIEW BY BOARDS AND COMMISSIONS:¯ Planning and D’ansportation Commission: The Planning and Transportation Commission (PTC) reviewed the SOFA Phase 2 CAP at five separate meetings. The PTC recommendations are summarized above in the Discussion section of this staff report and are attached as .a Draft CAP (see Exhibit A of Attachment B). The verbatim minutes of those meetings are also attached (see Attachment P). Historic Resources Board." The Historic Resources Board (HRB) reviewed the draft Working Group plan on April 17, 2002 and was generally supportive of it. The Board made four primary recommendations: o Allow Planned Community zone changes on sites with historic buildings if a benefit to the historic building or site would result. This option should be available throughout the SOFA 2 area, not just along Alma and High Streets. Modify the wording in Policy DC 8 (on page 19 of the plan) so that the parking reduction allowed on an historic site would be determined by the joint HRB/ARB board on a case-by-case basis. This provision would allow the joint board to evaluate the specific circumstances of each proposal and respond with a reduction that is appropriate for that set of circumstances. Allow bonus square footage obtained through a s6ismic upgrade of an historic building to be transferred to an eligible receiver site, especially if the bonus square footage cannot be added to the historic building itself in a manner that is consistent with the Secretary of the Interiors Standards. This recommended provision would augment the Transfer of Development Rights (TDR) program outlined in the draft Working Group plan. Use the nationally recognized "area of potential effect" when determining which buildings should be reviewed by the joint HRB/ARB board. The area of potential effect states that if a project on a non-historic site has the potential for having an impact on an historic site or building that the non-historic project must be reviewed in accordance with the Secretary of the Interior Standards. This criteria was recommend to replace the criteria stated in the draft Working Group plan, which calls for non-historic sites that are adjacent to or across the street from historic sites to be reviewed by the joint HRB/ARB. Architectural Review Board." The Architectural Review Board (ARB) reviewed the draft Working Group plan on April 18, 2002 and was generally supportive of it and the use of coordinated area plans in Other CMR:410:02 Page 14 of 17 areas of the City. The Board had the following comments on the draft Working Group plan: o o 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. Be clear in the plan that "enhancing" an area doesn’t mean using duplicative or imitative architecture. Only historic sites should be reviewed by the joint HRB/ARB board. References to "adjacent to" or "across the street from" historic sites should be removed from the plan. All references to "style" should be removed. The design process should not be micromanaged. Support for limiting PC zones to locations ’along High and Alma Streets with a 1.5 FAR cap and substantial public benefit. Support for the 50-foot height limit only along portions of High and Alma Streets. Support for prohibiting ground floor general business office in locations south of Homer Avenue. Emphasizing scale, mass and bulk issues in design policies and including references to paving treatments and public are in Policy DC -2. Include public art and newspaper racks in discussions of gateway treatments. .Lighting for pedestrians should be emphasized. Trees, lawns should be included in landscaping discussions. Adding color should be emphasized. Specifically state that consistency in signage in the area is not required. That will help enhance the eclectic nature of the area. Driveway specifications are too wide. Glare from lighting should be prevented not just minimized. The joint HRB/ARB review process should be reconsidered. Discussions with the Chairs of both Boards should occur to discuss this process. General support for separate reviews by the HRB and ARB, with HRB review only required for historic buildings or sites, not for non-historic buildings or sites. If the joint HRB/ARB process is going to be retained, training.for all participants should be provided. " Models of potential future development would be useful. Good guidelines and standards can result in more profitable development. Add sustainability concepts to guidelines. Promote "green building" techniques. Support livability and walkability concdpts in the Vision for the area. The area’s past should not be disgarded. Be careful when using a "form code" approach. Be sure to show a variety of prototypes so that one form or type doesn’t become the only accepted development type. Need to retain flexibility to retain eclectic nature of the area. Planned Community zones should be retained to allow flexibility in the area. CMR:410:02 Page 15 of 17 RESOURCE IMPACT There is no significant long-term impact on staff resources as a result of approval of either the Working Group plan or the PTC plan or an alternative plato The CAP will be implemented in the SOFA 2 area in place of existing zoning. Either the ARB or joint HRB/ARB board in accordance with standards and guidelines included in the CAP, will review projects. These review and approT~al procedures will not use significantly more resources that the current review and approval procedures. There will be an initial impact on staff time as training in the new requirements and procedures occurs. This additional time will eventually return to current levels, as staff becomes proficient in the application of the CAP requirements. POLICY IMPLICATIONS Adoption of a CAP will comply with Comprehensive Plan Policy L-25, which calls for enhancing the character of the SOFA as a mixed-use area, and Program L-22, which calls for the preparation of a CAP SOFA area. The plan is also in compliance with the Policy Framework adopted for SOFA overall as discussed in the "Background" section above. In addition, the plan itself will contain goals, policies, guidelines, standards and procedures specific to the SOFA 2 area that will be implemented over time. ENVIRONMENTAL REVIEW The City Council certified the Final Environmental hnpact Report (FEIR) for the overall SOFA area in April 2000. An addendum to that FEIR has been prepared and attached to’ this report for City Council review (see Exhibit A to Attachment A). Approval of the attached resolution will determine that the SOFA FEIR is the environmental document for Phase 2 of the SOFA CAP. ATTACHMENTS A. Resolution certifying SOFA FEIR as environmental document for SOFA Phase 2 with the attached Addendum to SOFA FEIR (Exhibit A). B.Ordinance approving the SOFA Phase 2 CAP with the attached PTC Recommended SOFA Phase 2 CAP (Exhibit A). C.Resolution Amending the Land Use Map of the Comprehensive Plan for SOFA Phase 2. D.Working Group Recormnended SOFA, Phase 2, CAP. E.Coordinated Area Plan Ordinance Number 4626. F.Policy Framework for the PAMF/SOFA CAP. G.Chart Summarizing Differences between the two recommended SOFA, Phase 2 Plans. H.Draftand Final EIR for the PAMF/SOFA CAP (Councihnembers only) I.Development Prototypes prepared by Freedman, Tung and Bottomley CMR:410:02 Page 16 of 17 K. L. M. N. 0. P. Q. R. Bay Area Economics Economic Study Sedway Economic Analysis Steve Pierce Economic Analysis Harold Justman Economic Anlaysis HRB Minutes ARB Minutes PTC minutes Correspondence Letter from Matt Kowta, BAE dated September 3, 2002 to Steve Emslie PREPARED BY: LISA GROTE-- Chief Planning Official DEPARTMENT HEAD REVIEW: CITY MANAGER APPROVAL: S A. ;LIE Director of Planning and Community Environment EMILg HARRISON Assistant City Manager cc~SOFA Working Group Interested Parties (CMR only) CMR:410:02 Page 17 of 17 Attachment A RESOLUTION NO. RESOLUTION OF THE COUNCIL OF THE CITY OF PALO ALTO CERTIFYING THE ADEQUACY OF THE SOUTH OF FOREST AREA COORDINATED AREA PLAN FINAL EIR AS THE ENVIRONMENTAL DOCUMENT FOR THE SOUTH OF FOREST AVENUE COORDINATED AREA PLAN, PHASE 2 AND MAKING FINDINGS THEREON PURSUANT TO THE CALIFORNIA ENVIRONMENTAL QUALITY ACT The Council of the City of Palo Alto does RESOLVE as follows: SECTION i. Background. The City Council of the City of Palo Alto (~City Council") finds, determines, and declares as follows: A. On March 27, 2000 the City Council adopted Resolution No. 7950 certifying that the South of Forest Area Coordinated Area Plan Final Environmental Impact Report (~2000 SOFA EIR") had been. prepared in compliance with the California Environmental Qualit~ Act (~CEQA") and that it was an adequate analysis for Phase 1 of the South of Forest Area Coordinated Area Plan. The 2000 SOFA EIR analyzed a project that included a twenty-one block area bounded by Forest Avenue, Alma Street, Addison Avenue, and Kipling Street. The project was subsequently divided into two phases. The South of Forest Area Coordinated Area Plan, Phase i, governing the south- eastern portion of the site, was approved in March of 2000 by Resolution No. 7951 and Ordinance No. 4626. The remainder, of the project, governing a nine-block area generally bounded by Alma Street, Forest Avenue, Ramona Street, and Addison Avenue, is known as the South of Forest Area Coordinated Area Plan, Phase 2, (~SOFA 2 CAP.") B. The 2000 SOFA EIR consists of the following documents and records: "South of Forest Area (SOFA) Coordinated ~Areal Plan Draft Environmental Impact Report" dated February 1999; "South of Forest Area Coordinated Area Plan Final Environmental Impact Report dated November 1999;" and "South of Forest Area Coordinated Area Plan Final Environmental Impact Report - First Amendment dated March 2000;" and the planning and other City records, minutes, and files constituting the record of proceedings. The Final EIR was prepared pursuant to the CalifOrnia Environmental Quality Act, Public Resources Code section 21000, et seq. ("CEQA"), and the State CEQA Guidelines, California Code of Regulations, Title 14, section 15000, et seq. The Final EIR is on file in the offices of the Director of Planning and Community Environment and, along with the planning and other City records, minutes and files constituting the record of proceedings, is incorporated herein by this reference. 020930 syn 0091143 C. Preparatory to the adoption by the City of the SOFA 2 CAP, City staff reviewed the 2000 SOFA EIR to determine whether a subsequent EIR was required by CEQA, or whether the 2000 SOFA EIR could be used, augmented only by an Addendum as authorized by CEQA Guideline 15164. The fntensity of development permitted under the SOFA 2 CAP, is less than that analyzed in the 2000 SOFA EIR for the nine-block Phase 2 area. It would not generate impacts beyond those evaluated in the 2000 SOFA EIR and no additional mitigation measures are required. None of the other situations identified in Guideline 15162 requiring a subsequent EIR exist. Therefore, the City has elected to proceed on the basis of the 2000 SOFA EIR, augmented by the Addendum attached to this resolution as Exhibit A. The 2000 Final EIR and a draft Addendum were presented to the Planning and Transportation Commission for its review and consideration prior to its final recommendati~Qn to the Council on September.5 2002. F. The City Council finds that the SOFA 2 CAP incorporates all mitigatmon monitoring program and includes a monitoring and enforcement program through the requirement for certificates of conformance with the CAP. Therefore, no additional mitigation monitoring program is needed to comply with Public Resources Code Section 21081.6. G. The City Council has reviewed and considered the information contained in the Final EIR and the Addendum and the record of proceedings. SECTION 2. Certification. The City Council certifies, based upon the record before it, that it is entitled to rely upon the previously certified 2000 SOFA EIR in reviewing the SOFA 2 CAP. The City Council has reviewed and considered the information contained in the Final EIR, the Addendum, staff reports, .oral and written testimony given at public hearings on the proposed Project, and all other matters deemed material and relevant before considering for approval the various actions related to the SOFA 2 CAP. SECTION 3. Significant Impacts Which Can Be Mitigated To A Less Than Significant Level. The City Council finds that the 2000 SOFA EIR identifies potentially significant environmental effects of the Project with regard to Traffic and Circulation, Noise, Geology, Hydrology, Health Hazards, Solid Waste Disposal, Vegetation and Wildlife, and Cultural Resources. The City Council finds that, in response to each significant effect listed in this Section 3, all feasible changes or alterations have been required in, or incorporated into, the Project which avoid or substantially lessen the significant environmental effects identified in the Final EIR as summarized below. Each of the Mitigation Measures summarized below is more fully described in Summary Table A in the 020930 syn 0091143 2 Final EIR. Because all mitigation measures are included in the Phase 2 SOFA CAP, no additional mitigation measures are required. A. Traffic and Circulation. Potentially significant impacts are identified if two-way traffic is reinstated on Homer and Channing Avenues. However, the SOFA 2 CAP does not implemen~ two-way traffic. Therefore, no mitigation is required. B. Noise. Potentially significant noise impacts are identified for residential and mixed use development in areas where the ambient noise level exceeds 60 dbL. .The provisions of Mitigation Measure 3 in the Final SOFA EIR have been incorp.orated in Chapters 4 and 5 of the SOFA 2 CAP and no further implementation is necessary. C. Geology. A potentially significant impact is that existing and proposed structures in the CAP area may be damagedby shrinking and swelling of soils. This impact will be reduced to - less than significant levels by Mitigation Measure Number 4 included in the SOFA 2 CAP, Chapter.5. This measure instructs the building official to require, as the building official deems appropriate, soils studies, and~ the implementation of the’ recommendations of such studies in order to reduce this impact to a less than significant level. D. Hydrology. A potentially significant impact is that pollutant runoff from construction and operation of new projects could be cumulatively significant. This impact will be reduced to less than significant levels by Mitigation Measure Number 5 included in the SOFA 2 CAP, Chapter 5, requiring incorporation of Best Management Practi’ces described in Policy N-27 and 29 of the Comprehensive Plan, and Chapter 36.28, Excavations, Grading and Fills of the Palo Alto Municipal Code. E. .Health Hazards. A potentially significant impact is exposure of a future population to contaminated soil and groundwater in the area. This impact will be reduced to less than significant levels by Mitigation Measure Number 6 included.~n.the SOFA 2 CAP, Chapter 5. A second potential impact is from release of asbestos during demolition of existing buildings. This impact will be reduced to less than significant levels by Mitigation Measure Number 7 included in the SOFA 2 CAP, requiring compliance with the City of Palo Alto Fire Department standards .and procedures for asbestos containing material. F. Schools. The EIR notes that implementation of the CAP will increase the demand on existing schools. State law declares that school impact fees collected by the Palb Alto Unified School District on all new construction are full and complete mitigation of any impact on schools. Therefore, the City cannot require any additional mitigation. 020930 syn 0091143 G. SOlid Waste Disposal. A potentially significant impact is an increase in solid waste from the demolition of existing buildings and the construction of new offices. The SOFA 2 CAP includes Mitigation Measures Numbers 8 and 9 included in the SOFA 2 CAP Chapter 5, requiring construction recycling plans, and operation recycling programs as part of the project approval process. This will reduce any impacts to a level of insignificance. H. Vegetation and Wildlife. A potentially significant impact was identified on heritage and landmark trees and publicly owned trees in the right of way. The SOFA 2 CAP includes requirements to preserve trees and landscaping. Mitigation Measure Number i0 is included in the SOFA 2 CAP in Chapters 4 and 5. These mitigation measures will reduce the potential impacts to vegetation and trees to a level of insignificance. I. Cultural Resources. A potentially significant impact was~identified on prehistoric and historic resources from future development, grading,~ and construction. The SOFA 2 CAP, like the SOFA CAP, Phase i,. permits parking exceptions up to 25% for historic properties, which has a beneficial impact on preservation. (2) (3 Mitigation Measure Number ii proposed the mandatory preservation of National Register-eligible properties and certain other historic buildings in the area, and incentives for the preservation of other historic properties. The SOFA 2 CAP provides for preservation of National Register-eligible properties except in very limited circumstances. It also provides incentives for preservation of historic properties in the Residential Transitional Districts. These measures reduce the potential impact to a level of insignificance. Mitigation Measure Number 12 specifying procedures to be followed if archeological resources or human remains are discovered during grading or construction activities, is included in Chapter 5 of the SOFA 2 CAP and will reduce potential impacts on prehistoric resources to a level of insignificance. Since all mitigation measures are incorporated in the SOFA. 2 CAP and enforceable through the requirement to obtain a Coordinated Development Permit prior to construction or alteration of buildings, no additional monitoring program is required. SECTION 4. No Significant Impacts Which Cannot Be Fully Mitigated. The Final EIR identified a significant environmental effect on open space if 1.3 acres of parkland could not be secured. 4 020930 syn 0091143 However, parkland has been acquired. finds that this effect has been insignificance. Therefore, the City Council reduced to a level of SECTION 5. The City Council previously certified that the Final EIR describes a reasonable range of alternatives to the Project that could feasibly obtain the basic objectives of the Project. The City Council has evaluated the comparative merits of the alternatives and rejected them in favor of the proposed Project as summarized below: A. Alternative #i - No~ Project Alternative. This alternative assumes no rezoning of the site, with any future development On the site consistent with existing zoning. T~is alternative is not desirable for the City because it would not achieve the goals and policies of the SOFA 2 CAP for more housing and parkland. B. Alternative #2 Alternative Land Use Plan. Palo Alto Medical Foundation~ This alternative is not relevant to the SOFA 2 area. C. Alternative # 3 - Alternative Circulation System Layout.. This alternative replaces the paired one-way circulation on Homer and Channing Avenues with two-way traffic on each street. The SOFA 2 CAP concludes that further study is needed before a decision can be made on this proposal. While some believe that two-way traffic would slo@ traffic, there are concerns about loading for commercial activities, traffic shifts, garage access for ~Channing House, and deterioration of intersections. D. Alternative #4 - Alternative Land Use Configuration and Transition. This alternative recommended a different !andl use configuration for the SOFA CAP, Phase i, which is not relevant to this project, and a lower intensity of development for the MU-I and MU-2 ("Mixed Use") areas, which include most of the Phase 2 area. The Area Plan analyzed in the 2000 SOFA EIR (in 1999) was expected to produce approximately 215 new residential units and 193,000 square feet of additional office space in the Mixed Use Areas. The SOFA 2 CAP further reduces the new office square footage while providing zoning and incentives for generally relatively small dwelling units in an area close to services and transit. The SOFA 2 CAP is superior to Alternative #4 in addressing the City’s imbalance between jobs and housing. SECTION 6. Impacts Found Not To Be Significant. The City finds that the Final EIR neither expressly identifies, nor contains 5 020930 syn 0091143 any substantial evidence identifying significant environmental effects of the Project with .respect to any of the environmental impacts dismissed through the scoping process with "no" responses on the initial Environmental Assessment (contained in Section 7.1 of the Draft EIR). It was identified, through the Initial Study, that the proposed project would not have any impacts on endangered or threatened habitat or species. SECTION 7. No Recirculation Required. The City Council finds that no new significant information has been received that requires preparation of a subsequent EIR. SECTION 8. Substantial evidence supporting each and every finding made herein is contained in the Final EIR, and Addendum including amendments, revisions and records of proceedings. INTRODUCED AND PASSED: AYES: NOES: ABSENT: ABSTENTIONS: ATTEST:APPROVED: City Clerk Mayor APPROVED AS TO FORM: City Manager Senior Asst. City Attorney Director of Planning and Community Environment 020930 syn 0091 I43 6 The Cily of Palo Alto humble, 2002-09-23 t 1:33:49Sore Attachment ~o CMR 020919 (~\cc-prmlraklGir~Data\Personal~ghumblo,mdb) D:\Gloria l\GIS\FireRun\landUse\Sofa il Cmr Date: File No: Propose Action: Change existing land use designations to SOFA II Coordinated Area Plan This map is a product of the City of Pale Alto GIS 500’ This document is a graphic reptesenl~lJon onJy of best available source The City of Pale AJlo assumes no responsibif~y for any errors. Exhibit A SOUTH OF FOREST AREA COORDINATED AREA PLAN FINAL ENVIRONMENTAL IMPACT REPORT ADDENDUM October 2002 Department of Planning and Community Environment City of Palo Alto TABLE OF CONTENTS PREFACE AND SUMMARY .......................................................3 PROJECT LOCATION, BOUNDARIES AND SITE ....................5 CHARACTERISTICS II.ANALYSIS OF LAND USE, TRAFFIC/PARI,~dNG AND CULTURAL ISSUES SPECIFIC TO SOFA CAP 2 .....................5 ATTACHMENTS: Attachment A: Attachment B: Attachment C: Attachment D: Attachment E: Attachment F.: SOFA 2 Area Map Comparison of Proposed Development Standards Working Group Recommendations Planning Commission Discussion Phase 2 Area Concept Plan Economic Feasibility Analysis Summary 2 PREFACE AND SUMMARY The City of Palo Alto certified a Final Environmental Impact Report (FEIR) in March of 2000 for the South of Forest Coordinated Area Plan (SOFA CAP). The FEIR consists of the following documents and records: "S OFA CAP Draft Environmental Impact Report dated February 1999"; "SOFA CAP FEIR dated November 1999"; and SOFA CAP FEIR - First Amendment dated March 2000"; and the Planning Department files, other City records and minutes constituting the record of proceedings. The FEIR is on file in the office of the Director of Planning and Community Environment. The original SOFA area (December 1998 SOFA Plan) was approximately 18 blocks bounded by Alma Street on the west, Addison Avenue on the south, Forest Avenue on the north, and mid-block between Kipling Street and Cowper Street on the east. This overall area was later divided into two phases for development because a large number of parcels in the Phase 1 area were being vacated by the Palo Alto Medical Foundation (PAMF) and the private redevelopment of those parcels would occur much more quickly than the rest of the area. The SOFA CAP FEIR described and analyzed the differences between the December 1998 and June 1999 SOFA CAP proposals, and the effects of the decision to adopt the SOFA CAP in two phases. Phase 1 - the nine blocks between Forest Avenue, Addison Avenue, mid- block between Kipling and Cowper and Ramona Street, including a small mid-block section on the west side of Ramona Street, includes all properties owned by he Palo Alto Medical Foundation (PAMF). Phase 2 - the nine blocksbetween Forest Avenue on the north, Addison Avenue on the South, Alma Street on the west, and Ramona Street on the east, excluding the small mid-block section on the west side of Ramona Street that was included in Phase 1. The 1999 FEIR is a Program EIR that accommodates the phasing of the plan and provides the environmental analysis for the entire SOFA CAP area. Phase 1 of the SOFA Plan was further analyzed in the First Amendment to the FEIR and was approved in March 2000. Future land development actions within the Phase 1 area will include design and land use approvals, subdivision of land, demolition and relocation of structures, construction activities, and infrastructure improvements. This Addendum to the Program FEIR focuses on the Phase 2 area and land development actions within that area. Upon SOFA 2 Coordinated Area Plan (SOFA 2 CAP) adoption, development proposals in conformance to the Plan may be processed under the procedures described in the SOFA 2 CAP. Development proposals not consistent with the Plan may require additional environmental analysis as focused environmental impact reports and will be processed as amendments to the Plan requiring review by the Planning Commission and City Council. The California Environmental Quality Act (CEQA) allows for the revision of an EIR after public review. These revisions can discuss changes in the project itself, or its setting, or simply provide additional information. The entire EIR must be "recirculated" only if significant new information prevents the public of a meaningful opportunity to comment on: ® ® a substantial adverse effect of the project a feasible way to mitigate or avoid such effect, including a feasible alternative rejected by the applicant. No new substantial adverse affects have been identified from project revisions or changes in the project setting for the SOFA 2 area. Feasible mitigation measures and alternatives have been incorporated in the Revised SOFA CAP Phase 2, and no substantial adverse effects remain. Therefore, recirculation is not required for this Addendum to the FEIR. 4 SECTION I PROJECT LOCATION, BOUNDARIES AND SITE CHARACTERISTICS Phase 2 consists of the nine blocks between Forest Avenue on the north, Addison Avenue on the South, Alma Street on the west, and Ramona Street on the east, excluding the small mid-block section on the west side of Ramona Street that was included in Phase 1, see Attachment A, SOFA 2 Area Map. A major impetus for Phase 2 of the SOFA CAP preparation was the emergence of new development in the commercial portions of the nine-block area. These new developments generally included commercial office and residential uses in denser developments than the existing automobile-oriented service uses, which previously dominated the area. High land values, high tech related employment growth, and the limited opportunity for growth in commercial districts throughout the downtown has fueled this development trend. These conditions are likely to result in continued development pressures in the area. Therefore, Phase 2 of the CAP specifies the appropriate land use pattern and intensity of development in the nine-block area and addresses such concerns as; compatibility of development with existing uses, parking, traffic, historic resources, recreation!open space, architectural/design issues, development standards, the relationship between the SOFA Phase 2 area and the Downtown, and new land use designations. SECTION II ANALYSIS OF LAND USE, TRAFFIC/PARKING AND CULTURAL ISSUES SPECIFIC TO SOFA CAP 2 A Working Group was appointed by the City Council to advise the City on the issues, alternatives and substance of the SOFA 2 CAP. The Working Group recommendations and the Planning Commission recommendations vary on certain issues. This Addendum includes an analysis of the key issues. The Council retains the ultimate decision making responsibility for policy direction, plan content and plan adoption. Attachments B, C and D summarize the primary areas of difference between the Working Group and Planning and Transportation Commission recommendations. Policy Implications Phase 2 of the SOFA Plan is consistent with Comprehensive Plan Policy L-25, which calls for enhancing the character of the South of Forest Area as a mixed-use area, and Program L-22, which calls for the preparation of a coordinated area plan for the South of Forest Area and the Palo Alto Medical Foundation site(s). 5 The Policy Framework states that development proposals found not to be consistent with the Plan will be processed as amendments to the Plan requiring review by the Planning Commission and City Council. The Policy Framework does not state that Planned Community (PC) zones are not or should not be permitted. If the ability to apply for a PC is permitted within the Plan, that process would allow those applications that are consistent with the vision, goals and objectives of the plan but not the development standards to be evaluated on the project merits. The Planning Commission, ARB (and HRB if an historic site or structure is involved), and the City Council all review PC applications. The PC process also allows multiple opportunities for public review and input. Applying for a PC zone would not necessarily mean that the project is inconsistent with the Plan, but rather that the development standards may not best address the unique circumstances found on a particular site. After considering the Policy Framework provisions, the Worldng Group decided against allowing PC zones in the SOFA 2 area. The Planning andTransportation Commission considered the Working Group and staff recommendations and decided to allow PC zones with a maximum 1.5:1 FAR in RT-35 and up to 2:1 FAR in RT-50, With the requirement that a substantial public benefit would be provided. The public benefit would include items such as increased below market rate (BMR) housing, childcare facilities, public open space, public parking or other community facilities within the SOFA 2 area. Attachment B is a summary of the Planning and Transportation Commission proposal for SOFA 2 floor area regulations and a comparison of the Worldng Group Recommendations and the Planning Commission recommendations for the RT-35, RT-50 and PC Zoning Districts. All of the goals and policies in the SOFA CAP 2 support mixed-use development with any additional floor area, over and above that which is permitted under the existing zoning, to be used for additional housir~g. The primary differences between the Working Group and the Planning and Transportation Commission concern the intensity of that mixed-use or housing development. These differences are summarized below under the "Development Standards" discussion. Development Standards The Worldng Group plan calls for a maximum floor area ratio (FAR) of 1.15:1. This maximum can be achieved with a project that is either all housing or mixed- use, which would include housing and commercial uses. If it is a mixed-use project, no more than .4 of the FAR can be in commercial use. The majority of the Worldng Group recommended prohibition of Planned Community (PC) zones to exceed the FAR or any other development standard. 6 The Planning and Transportation Commission alternative recommends two different Residential Transitional (RT) districts. In the RT-35 district, closer to SOFA Phase 1 and existing single family neighborhoods, the maximum height for new construction is 35 feet, and the base maximum FAR is 1.15 to 1. This can be increased to 1.5 with a PC district or through seismic or historic preservation bonuses. In the RT-50 district closer to Alma Street, the height limit is fifty feet, (excluding daylight plane areas along Homer Avenue), the base maximum FAR is 1.5, and the maximum FAR with a PC district or seismic or historic preservation bonuses is 2.0. Within the overall maximum FAR limits, office use cannot exceed 0.25:1, and commercial uses of all kinds cannot exceed 0.4:1 FAR. In the Phase 2 area as a whole, height limits are lowered from the existing 50 feet in areas closest to existing residential development and historic low rise areas such as Homer Avenue. In the RT-50 area, the existing rule that lowers the height limit in proximity to residential and mixed use development is eliminated. Parking The Working Group plan calls for on-site parking to be provided in accordance with the provisions of 18.83 of the Municipal Code. No parking reductions are allowed for proximity to the train station or other public transit. The Planning and Transportation Commission alternative calls for parking reductions based on the inclusion of transportation demand management (TDM) programs in development proposals and for proximity to the train and other forms of public transportation. Cultural The Final EIR identified impacts on historic resources because changes in land use regulation might encourage new construction that damaged their historic integrity. It concluded that the impact could be mitigated to a level of insignificance. The Final EIR identified the historic resources in both the SOFA 2 and SOFA 1 areas. These included sites on the City’s own Historic Inventory and additional sites that had been identified as potentially eligible for the National Register of Historic Places or the California Register of Historic Resources. Mitigation measures were revised in the First Amendment because the City did not adopt a historic preservation ordinance of general application. Instead, the SOFA Cap, Phase 1 itself requires preservation of National Register eligible buildings and provided encouragement for preservation of others. The SOFA CAP, Phase 2 as recommended by the Planning and Transportation Commission provides the same or greater level of protection to historic resources as the SOFA CAP, Phase 1. It protects both National Register and California Register sites and provides transferable floor area bonuses, parking exemptions, and liberal non-conforming use continuances as incentives. It includes all relevant 7 mitigation measures for them, and there are no new impacts. Policies and standards for historic preservation, and for assuring that nearby development respects historic resources, are set forth in Policies DC 6-14 and Chapter 5.110. There is a staff recommendation that under limited circumstances, the City Council may authorize demolition or relocation of non-National Register eligible buildings where it does have a significant effect on the City’s historic preservation program as set forth in Chapter 16.49 of the Palo Alto Municipal Code. The Working Group draft contains a statement that all buildings on the City’s historic inventory, or eligible for the National or California Register will be preserved. However, it has no implementing policies or requirements to that effect. ’ It does include incentives, such as density bonuses, for historic preservation. A plan that does not protect National Register-eligible structures Would, as indicated in the Final EIR, have a potential significant impact on historic resources and a statement of overriding concerns would have to be made before it could be adopted. Review Process The plan calls for non-historic sites that are not adjacent to or across the street from historic sites or structures to go through the standard ARB process for new development and remodeled existing development. All historic sites and non- historic sites that are adjacent to or across the street from historic sites would go through the joint HRB/ARB process that was established in Phase i of the SOFA study. See Attachment D for historic resources. Cumulative Impacts and Recently Anticipated, Pending, Ap~ Construction or Finalized Development Pro_iects in the SOFA 2 Area The SOFA CAP 2000 FEIR includes an analysis of the cumulative impacts associated with the development of projects within the entire SOFA CAP area. The Phase 2 Area Concept Plan, See Attachment E, consists of mostly Mixed Use Development including Housing (MU-1, MU-2). This zoning would allow residential development of up to 50 units/acre provided by allowing additional office square footage and a total FAR up to 2.5. Both the Working Group Plan Concept and the Planning and Transportation Commission recommended Plan Concept have revised the zoning in the SOFA 2 area from MU to Residential Transition districts that reduce the FAR to 2:1 or 1.15:1 and a range ofl 5-50 residential units per acre. The revised Concept Plans result in the reduction of potential intensity of development in the SOFA 2 area. See Attachments C and D. The following list describes known projects within the SOFA 1 and SOFA 2 areas. NEW DEVELOPMENT PROJECTS IN SOFA 1 AND 2 Project Name/Location 901-925 High Street SOFA 2 Status Pending Type of Project Residential: 12 units 800 High Street SOFA 2 Pending Residential: 61 units Retail: 1,600 sq. ft. PAMF - Summerhill Homes 270 Channing Avenue SOFA 1 Approved SFR: 15 units SOFA Child Care Facility Channing and Ramona SOFA 1 Under Construction Institutional: 5,000 sq. ft. Summerhill Homes Bryant Street SOFA 1 Approved SFR: 30 units Summerhill Homes Condominium Project SOFA 1 Approved MFR: 37 units Oak Court Affordable Housing Bryant and Channing SOFA 1 Approved MFR: 53 units Premier Properties 820 Ramona Street SOFA 1 Approved Office/Retail 37,000 sq. ft. Source: City of Palo Alto Planning Division (Updated June 28, 2002) Economic Anal sv_~. The Coordinated Area Plan ordinance (No. 4454) calls for the coordinated planning effort to include an analysis of the economic environment so that the planning process works in conjunction with the marketplace, rather than independent of it. A complete economic analysis was conducted during Phase 1 of the CAP process, and a complete economic analysis was recently conducted by Bay Area Economics (BAE) for the SOFA 2 CAP. BAE analyzed the zoning alternatives for a 1.15 Floor Area Ratio (FAR) maximum recommended by the SOFA 2 Working Group, an alternative specifying a 1.5 FAR maximum proposed by City staff, and a third 2.5 FAR alternative. For each of the zoning alternatives a series of illustrative development prototypes was developed by the urban design firm of Freedman, Tung and Bottomlety (FTB). FTB created a development prototype for each FAR level for both a small and large site. For each of the different prototypes, BAE estimated parking requirements (reduced and standard) and estimated the resulting residual land values. In addition to the different density regulations, BAE evaluated the economic viability of restriction on ground floor office uses in certain portions of the SOFA 2 area. BAE also evaluated the general demand for retail space and viability of retail uses within specific corridors of the SOFA 2 area. The results of the BAE report are summarized below and in Attachment F - Economic Feasibility Analysis Summary. The entire BAE report is attached to City Manager Report 410:02. Parking The reduced parking alternative adds to the efficiency of the site but only provides marginally higher returns where a site can physically accommodate the higher parking requirements without reducing the building intensity. Existing zoning standards do not provide sufficient economic incentive to landowners to redevelop their property. Owners of smaller parcels have more barriers towards redevelopment than larger sites because the larger sites offer better economies of scale and improved site parldng efficiencies. Redevelopment potential for sites that do not have sufficient size to build underground or partially submerged podium parking would be severely limited under the standard parking requirements. In addition, a City policy that restricted parcel consolidation would reduce redevelopment feasibility due to a loss of economies of scale and reduction in site efficiencies. !0 Small Site Redevelopment Opportunities Existing market conditions would not provide sufficient incentive to redevelop a small site (approximately 12,000 square feet or less) under a 1.15 FAR alternative. While a 1.5 FAR parking alternative provides redevelopment incentive for smaller sites, redevelopment would likely result in condominium projects and not mixed- use projects because of the higher parking requirements for office and retail uses. Due to the marginal feasibility for the small site, a 1.5 FAR zoning alternative may have difficulty providing a local public benefit (e.g. open space, available public parking, etc.), which would be necessary to apply for the 125 FAR without eliminating the site’s economic feasibility. The 2.5 FAR low parking requirement would generate the highest land residual value. Large Site Redevelopment Opportunities Due in part to the lower economic value of the substation and greater site efficiencies, the 1.15 FAR standard parking alternative would provide sufficient financial incentive for redevelopment. Similar to the small site, the standard parking alternatives for the 1.5 and 2.5 FAR alternatives would curtail the total building square feet regardless of the FAR limitations. Office and Retail Curtailing ground floor office uses within the SOFA 2 area altogether may deter redevelopment projects that create mixed-use products. Properties not within close proximity to other retail services that could not create retail synergies are likely to struggle to maintain a retail tenant at comparable office lease rates. The result would be a greater emphasis on residential projects compared to building both retail and residential mixed use. Furthermore, if parking availability is exceedingly constrained within th~ area, developers may have difficulty competing with nearby downtown retail space, which are a part of a parking district. Notwithstanding, current retail market conditions are relatively healthy and would likely support new retail. A possible alternative could be to limit ground floor office uses along specific retail nodes and allow ground floor office in areas that are less conducive to retail. Based on existing retail conditions, logical retail locations appear to be Homer Avenue and Emerson Street. Corridors less conducive to retail include Alma and Ramona Streets. Attachment A The City of Palo Alto SOFA II Area Map TNs map is a product of the City of Palo Alto GIS Attachment Proposal for SOFA 2 Floor Area Regu|ations Residential Use, including: o Two/Multi-family use ¯Residential care homes ~SRO Housing -Day care centers/homes ~Public parking ~Religious institutions Total office + non-office commercial Non-office commercial, including: -Retail services ~Lodging ¯Automobile services and service stations o Convalescent facilities -Restaurants ~Personal services ~Private clubs/lodges ~Transportation terminals ¯Commercial recreation Office uses, including: Medical, professional, and general business offices o General business services ~Financial services ~Educational facilities ~Utility facilities Mixed residential and commercial use Mixed commercial uses RT-35 Maximum FAR 1.15:1 (1.50:1 with PC - see reverse side for PC restrictions) 0.40:1 Up to the full 0.40:1 Restricted tc 0.25:1, up to 2,500 square feet 1.15:1 total FAR must meet minimum residential density any amount of neighborhood serving commercial office uses are restricted to 0.25:1 FAR, with a 2,500 square foot maximum 0.40:1 max. total FAR any amount of neighborhood serving commercial office uses are restricted to 0.25:1 FAR, with a 2,500 square foot maximum RT-50 Maximum FAR 1.50:1 (2.0:1 with PC - see reverse side for PC restrictions) 0.40:1 Up to the full 0.40:1 Restricted to 0.25:1, up to 2,500 square feet 1.50:1 total FAR must meet minimum residential density any amount of neighborhood serving commercial office uses are restricted to 0.25:1 FAR, with a 2,500 square foot maximum 0.40:1 max. total FAR any amount of neighborhood serving commercial office uses are restricted to 0.25:1 FAR, with a 2,500 square foot maximum Planning and Transportation Commission Proposal for SOFA 2 Planned Community District Regulations Maximum FAR Number of public benefits that must be provided Permitted public benefits Other Restrictions RT-35 1.5:1 1.20% of the housing provided is BMR housing 2.Substantial public parking 3.A child care facility 4.A well-designed public gatheringspace 6. RT-50 2.0:1 2 Below market rate space for community/non-profit services. Must be mixed residential and commercial use Use must be predominantly residential Residential units may be no .larger than 1,500 square feet The heights and daylight planes of the districts may not be exceeded, except for normally permitted encroachments ul X 0 o E =E ~p x U U U £.I O0 O0 u u -’1 :::3 o 0 u o o ~ "E "~ "~- ,-., ’-. ’- ~ oE E04- 0 0 0 (U ~,, t- o Z E U co U Attachment C H / PERMITTED LAND USES RES-TRANS 35 RES-TRANS 50 P-RES-TRANS 35 PF R-2 RM-30 Residential Transition up to 35’ in height at 1.15 FAR Residential Transition up to 50’ in height at 1.15 FAR Pedestrian Oriented Residential Transitional 1.15 FAR 35’ height No Ground Floor Office on Homer or Emerson, no General Business Offices south of Homer except along Alma, Max 2500 sf office on ground floor Public Facilities Low Density Residential District (7-14 units/acre)/existing Medium Density Residential District (15 - 30 tmits/acre)/existing Sites with Redevelopment Potential (pending application or FAR<l) Historic Property: Category 1 & 2 eligible for National Register N 0’25’ 50’ 100’ 200’ FRIEDMAN TUNG BOTTOMLEY WORKING GROUP RECOMMENDATIONS SOFA PHASE 2I Coordinated Area Plan 5117]02 Attachment D / PERMI’I’FED LAND USES RT-35 RT-50 RM-15 PC Residential Transition up to 35’ in height at 1,15 Base FAR, 1,5 Max, FAR with PC w/1 public benefit or TDR Residential Transition up to 50’ in height at 1,5 Base FAR, 2,0 Max, FAR w/TDR or 2 public benefits w/PC (15’ stepback above 35’ along High St,) Medium Density Residential District (6-15 uuits/acre)/existing Planned Community R-2 RM-30 Lq.,w~e.n.sity R_esid,entia, l District tz wuits per Site/existing) Medium Density Residential District (15-30 units/acre)/existing Sites with Redevelopment Potential (pending application or FAR <.5) SOFA 2 Historic Resources and potential National and California Register Historic Survey List (see appendix B for additional detail) N 0’25’50’ IOlY 200’ Buildings Potentially Eligible for Seismic Bonus FREENHAN TNNG N BOTTOMLEY PLANNING COMMISSION DISCUSSION s:\Plan\Plsdiv\Lisa~Sola\planning commission discussion_updt, pdf SOFA PHASE 2 Coordinated Area Pla.n 09125/02 DESIGN CHARACTER;All new development shall be consistent with Design Guidelines requiring compatiblemassin9 with surrounding neighborhood,pedesthan scale design,-and visual=nterest at ground floor, Existing mature tree canopy will be preservedand enhanced. COWPER STREET HISTORIC PRESERVATION:Encourage reuse and allow alterations tohistodc structures in compliance withCEQA and Palo Alto Historic Ordinance.Allow parking reductions of up to 25% forhistodc preservation of designated histod~properties.Specific site plan direction:. Support restoration of Roth Building ~ to its odginal form.- Encourage restoration of histodc homeson Bryant for residential use.- Encouragewhen restored, NEIGHBORHOOD COMMERCIAL USE:Encourage neighborhoodserving commercial uses along selected portions of Homer andEmerson Streets. AUTOMOBILE/ COMMERCIAL USES:Existing auto uses may remain butany new ones must be locatedon High orAIma Streets.Responsibility for compatibilitywith existing development placedon new development sites. CIRCULATION: Channing, Homer and High between Homer and Channing retum to two-way flow to calm traffic. ¯ Establish additional loading zones , for Whole Foods. HIGH STREET RAILROAD CROSSING: Construct a well-designed tunnel under crossing of the railroad tracks at Homer funded by existing funds contributed by PAMF, grant money and other sources. Attachment E DETACHED HOUSING ON SMALL LOTS (DHS):’ detached homes on ,5,000 square foot or for accessory Units. moderate density (8-12 units per acre) located to buffer existing residential neighborhoods from hi~]her intensity development.Approximate housing yield of 35-40 pdmary homes and up to 20 second" NEIGHBORHOOD PARK:New proposed 1.6-acre neighborhoodpark on former site of PAMF facili~es. | ATTACHED MULTIPLE DUSING(AMF):i Apartment condominiums to provide more housing near transit and services and opportun!ty to accommodate a variety of household types. 30-60 units per acre resulting in a likely yield of up to approximately 90 units. FAR not to exceed 1.5. ¯CHILD CARE FACILITY;Develop child care center for 75-90 children on site leased fromPAMF for 30 years at $1.00 per yearat comer of Channing Avenue and Ramona Street. AFFORDABLE HOUSING: Identify potential 1 -acre site within AMF or MU-1 zone for development of affordable housing. Use in lieu fee- for Below Market Rate housing from development within the Plan Area to acquire and construct housing. MIXED USE DEVELOPMENT INCLUDING HOUSING (MU-I,MU-2):Incentive to build residential development at densities of up to 50 units/acre provided by allowing additiona! office square footage. Total FAR up to 2.5, Parking pdmadly underground. Anticipated housing yield of up to 160 units accompanied by about 150,000 squarefeet of office space, resulting in a net decrease of office space in Plan Area due to removal of PAMF facilities. A Land Use Planning and Design Firm SOFA SPECIFIC LAND USE DESIGNATIONS:EXISTING ZONING: ~,,~,,,~,~,~:~ DHS Detached Houses on Small Lots (8-20 units per acre)R=2 Low Density Residential Distdct (7M4 units per acre) AMF Attached Multiple Family (30-50 units per acre)RM-30 Medium Density Residential. Distdct (15-30 units per acre) MU-1 Moderate Density Mixed Use Combining Distdct RM-40 High Density ResidentialDistdct (31-40 unlts per acre) MU-2 High Density Mixed Use Combining District PF Public Facilities/Park Source: Alison Kendall Planning and Design and Tanja Mai, Graphics & Design & Planning SOFA Area Plan EIR Concept Plan No Scale Figure 3 Attachment F her property. If the same building leased at $3.00 per square foot, a 1.5 FAR reduced parking alternative would provide sufficient economic incentive.- Economic Feasibility Analysis Summary 0.6 FAR 1.15 FAR Standard Parking 1.15 FAR Reduced Parking 1.5 FAR Standard Parking 1.5 FAR Reduced Parking 2.5 FAR Standard Parking 2.5 FAR Reduced Parking Existing Zoning 0.6 FAR 1.15 FAR Standard Parking 1.15 FAR Reduced Parking 1.5 FAR Standard Parking 1.5 FAR Reduced Parking 2.5 FAR Standard Parking 2.5 FAR Reduced Parking $3,757,000 $3,599,000 $4,392,000 $4,192,000 $7,078,000 $6,396,000 $3,208,000 $8,426,000 $8,109,000 $8,426,000 $9,954,000 $10,791,000 $14,075,000 $5,137,000 $4,988,000 $6,838,000 $6,646,000 $9,773,000 $9,496,000 $4,142,000 $13,344,000 $13,023,000 $13,344,000 $16,819,000 $16,528,000 $22,898,000 $1,380,000 $1,388,000 $2,446,000 $2,454,000 $2,696,000 $3,099,000 $934,000 $4,918,000 $4,914,000 $4,918,000 $6,864,000 $5,73~,000 $8,823,000 Not feasible Not feasible, needs ~25% increase in gross revenue. Feasible with ~1% increase in gross revenue Feasible with ~1% increase in gross revenue Feasible Feasible, could absorb some reduction in condo values or increased costs Not feasible Feasible, and feasible with substation priced at $155/Lot S q.Ft. Feasible, and feasible with substation priced at $155/Lot Sq.Ft. Feasible, and feasible with substation priced at $155fLot Sq.Ft.. Feasible, and feasible with substation priced at $280/Lot Sq. Ft. Feasible, and feasible with substation priced at $205/Lot Sq. Ft. Feasible, and feasible with substation priced al $400/Lot Sq. Ft. Sacramento Region Office 740 G Street Davis, CA 956516 Headquarters 530.750.2195 539.750.2194 fax bayareaeconomics.com 510.549.7310 12 Attachment ORDINANCE NO. ORDINANCE OF THE COUNCIL OF THE CITY OF PALO ALTO ADOPTING THE SOUTH OF FOREST AREA COORDINATED AREA PLAN, PHASE 2 AND AMENDING SECTION 18.08.040 OF THE PALO ALTO MUNICIPAL CODE (THE ZONING MAP) TO~ CHANGE THE CLASSIFICATION OF CERTAIN PROPERTIES GENERALLY BOUNDED BY FOREST AVENUE, RAMONA STREET, ADDISON AVENUE, AND ALMA STREET TO SOUTH OF FOREST AREA, PHASE 2 DISTRICTS The Council of the City of Palo Alto does ORDAIN as follows: SECTION i. The City Council finds as follows: A. Coordinated Area Plans ("CAPs") are intended to be used to facilitate neighborhood based planning for the use and re- use of land and buildings. The purposes of a CAP are described by Palo Alto Municipal Code section 19.10.010 as follows: ~ ~(a)To create enhanced opportunities for building a sense of community through public involvement in planning processes which are designed not only to satisfy constitutional due process requirements, but also to provide residents, and business and property owners with early, meaningful opportunities to help shape the physical components of their neighborhoods and community. (b)To emphasize and enhance architectural~ qualities, public improvements, and site design by providing a graphic, visual linkage between policies and programs established in the Comprehensive Plan and specific development entitlements and public improvements. (c)To facilitate physical change by each of the following methods: Accelerating and coordinating the planning process within selected areas so that private development and re-use can proceed under streamlined City review processes. (2)Encouraging rational private investment by providing specific, dependable information about the design requirements, development 020930 syn 0091146 1 standards, and uses allowed on a particular site. (3) (4) Analyzing and considering the economic environment so that the planning process works in conjunction with the marketplace, rather than independent of it. Coordinating and timing public infrastructure investment to facilitate desirable private land uses. (d)To assure Palo Alto’s environmental quality by using the Comprehensive Plan Environmental Impact Report to focus environmental review on area and site-specific issues and changed circumstances. (e)To facilitate orderly and consistent implementation of the City’s Comprehensive Plan." B. The City Council has conducted a public hearing on the SOFA Coordinated Area Plan, Phase 2. C. The City Council has reviewed and considered the information contained in the SOFA CAP Final Environmental Impact Report, and the Addendum to it, and has certified the adequacy of the environmental review and has made findings upon the significant environmental impacts identified in the EIR. D. The City Council finds and determines that the SOFA CAP, Phase 2 is consistent with the Comprehensive Plan of the City of Palo Alto, as amended. The City Council has specifically considered the regional welfare and the impacts of the development agreement upon the regional welfare. The City Council finds and determines that the benefits of the project set forth in the EIR and CAP establish the reasonable relationship of the project to the regional welfare. E. The City Council has specifically considered and hereby approves integration of the SOFA CAP, Phase 2 with the City’s Capital Improvement Program in order to assure timely implementation of the public improvements set forth in the CAP. F. The City Council has specifically considered the economic and fiscal feasibility of the SOFA CAP, Phase 2 in light of market place factors and incentives and disincentives to the desired development product, as well as a cost-benefit analysis of the public infrastructure investments and projected economic benefits to the city and community< and hereby finds and determines as follows: 020930 syn 0091146 2 (i)The proposed development is economically feasible under current market conditions; (2)The development intensity proposed is warranted by the area’s close proximity to both transit and neighborhood and downtown retail services, and to existing single and multiple family development; and (3)The public infrastructure investment of approximately $i0,000,000 in Phase 1 of the CAP resulted in the City acquiring a total of 2.41 acres of land and the historic Roth building for park, affordable housing and public facility purposes. This public investment was warranted by the City’s need for affordable housing and parkland. In addition, 1.5 acres of the 2.41 total were dedicated without cost to the City. Public infrastructure planned for the Phase 2 area includes the Homer Avenue pedestrian/ bicycle undercrossing and street improvements...~ The public infrastructure investment will total approximately $3,200,000, most of which will be reimbursed through grants from various sources. G. The City Council hereby finds that the adoption of the SOFA CAP, Phase 2 will serve the public interest, health, safety and genera! welfare. SECTION 2. The SOFA CAP, Phase 2 shall be deemed to include the following documents: Ao South of Forest Area Coordinated Area Plan, Phase 2 attached as Exhibit The environmental mitigation measures identified in the accompanying "Resolution of the Council. of the City of Palo Alto Certifying the Adequacyof the South of Forest Area Coordinated Area Plan Final EIR as th~ Environmental Document for the SOFA 2 Coordinated Area Plan and Making Findings Thereon Pursuant to the California Environmental Quality Act," each of which has been incorporated into Exhibit "A"; and C °This Ordinance Adopting the South of Forest Area Coordinated Area Plan, Phase 2; SECTION 3. The City Council hereby adopts the SOFA CAP, Phase 2 as the coordinated area plan and zoning regulations for SOFA, Phase 2. 020930 syn 0091146 SECTION 4. Section 18.08.040 of the Palo Alto Municipal Code, the "Zoning Map," is hereby amended by changing the zoning of that area property shown on the map labeled Exhibit ~B," attached to this ordinance and by this reference made part of it, to SOFA CAP, Phase 2, and more particularly to its districts, SOFA R-2, SOFA RM-15, SOFA RM-30, Residential Transition RT-35 and Residential Transition RT-50. Planned Community Districts 2697, 3707, 4283, and 4389 remain in effect, subject to the additional requirements of the SOFA CAP, Phase 2. SECTION 4. This ordinance shall be effective upon the thirty-first (31st) day after its passage and adoption. INTRODUCED: PASSED: AYES: NOES: ABSENT: ABSTENTIONS: ATTEST:APPROVED: City Clerk APPROVED AS TO FORM: Mayor City Manager City Attorney Director of Planning and Community Environment 020930 syn 0091146 4 EXHIBIT A SOUTH OF FOREST AREA COORDINATED AREA PLAN, PHASE 2 020930 syn 0091146 5 DISTRICTS RT-35 Residential Transition 35’ RT-50 Residential Transition 50’ RM-15 SOFA 2 RM-15 District PC R-2 RM-30 Planned CommnniD, District SOFA 2 R-2 District SOFA 2 RM-30 District N 0’25’ 50’ 100’ 200’ Corrected version as of 10102102. Please replace map in PTC Plan. [R[[DMAN TUNG UOTIOMLEY South of Forest Area District Map _qOFA PHASE 2 Coordinated /~rea Plan (!91251(12 Exhibit A PLA E EN CITY OF PALO ALTO TH OF FO AREA COOF~NATE A ASE 2 ST PLA City of Palo Alto Department of Planning and Community Environment SOFA PLAN PHASE 2 TABLE OF CONTENTS Chapter 1: Introduction .....................................................................................................1 ’ B. C. D. Purpose of the Coordinated Area Plan ............................................... .......................................1 Relationship between the SOFA Cap and Other City Plans and Ordinances ...........................2 Relationship of SOFA to Downtown Commercial District ..........................................................2 Organization of the CAP ............................................................................................................4 Chapter 2: Vision ............................................... .................................................................6 Chapter 3: Policies .............................................................................................................7 Land Uses (L) ........................................................................................................................................7 General Land Use Policies ...............................................................................................................7 Neighborhood-Serving Commercial Uses ........................................................................................7 Mixed-Use Development ..................................................................................................................9 Automobile and Other Service Uses ................................................................................................9 Housing (H) ............................................................................................................................................9 Housing Quantity and Density Policies ..........................................................................................10 Variety of Housing Type Policies ....................................................................................................10 Affordable Housing Policies ............................................................................................................10 Transportation (T) ...............................................................................................................................11 Trip Reduction ................................................................................................................................11 Transit Oriented Development ........................................................................................................12 Parking Management .....................................................................................................................13 Traffic Patterns ...............................................................................................................................14 Transit Service ................................................................................................................................18 Bicycle Circulation ..........................................................................................................................18 Pedestrian Circulation ....................................................................................................................20 Community Facilities (CF) ..................................................................................................................21 Schools ...........................................................................................................................................21 Libraries ..........................................................................................................................................21 Open Space/Public Facilities ..........................................................................................................21 Design Character and Guidelines (DC) ..........................................: ..................................................22 Preserving Existing Buildings and Scale ........................................................................................24 Historic Preservation ......................................................................................................................24 Public Art ........................................................................................i ...............................................26 Public and Private Trees (PPT) ..........................................................................................................26 Trees on Public Property ....................................................., .................................................~ ........27 Trees on Private Property ................. ............................................................................ ..................27 Accessibility (A) ..................................................................................................................................27 9.30.02.FINAL SOFA CAP P&TC Version.doc i October 01,2002 Chapter 4: Compatibility Requirements and Design Guidelines ..................................29 Section 4.010 Section 4.020 4.020(a) 4.020(b) 4.020(c) 4o020(d) 4o020(e) 4.020(f) 4.020(g) 4.020(h) 4.020(i) 4.0200) Section 4.030 4.030(a) 4.030(b) 4.030(c) 4.030(d) 4.030(e) 4.030(f) 4o030(g) 4.030(h) 4.030(i) 4.030(j) 4.030(k) 4.030(I) 4.030(m) 4.030(n) 4.030(0) 4.030(p) 4.030(q) Compatibility Requirements ....................................................................................29 Design Guidelines for Public Property ...................................................................30 Streets and Alleys .......................................................................................................30 Intersections and Crosswalks .....................................................................................31 Gateways ....................................................................................................................31 Sidewalks ....................................................................................................................31 Pedestrian Amenities ..................................................................................................31 Street Furniture ...........................................................................................................32 Street Parking .............................................................................................................32 Landscaping ................................................................................................................32 Lighting ........................................................................................................................33 Public Art .....................................................................................................................33 Design Guidelines for Private Property ..................................................................34 Architecture .................................................................................................................34 Paseos ........................................................................................................................34 Entrances .... ................................................................................................................35 Height ..........................................................................................................................35 Massing/Building Articulation ......................................................................................35 Driveways ....................................................................................................................35 Fences and Walls ...............................................................................................~ ........36 Landscaping ................................................................................................................36 Lighting ....................................................: ...................................................................36 Signage .......................................................................................................................36 Parking ........................................................................................................................36 Bicycle Facilities ..........................................................................................................37 Art ................................................................................................................................37 Mixed Use Design Guidelines .....................................................................................37 Trash and Loading Areas ............................................................................................38 Pocket parks, plazas, and courts ................................................................................38 Noise ...........................................................................................................................38 Chapter 5: Development Standards ................................................................................39 5.010 5.020 5.030 5.040 5.050 5.060 5.070 5.080 5.090 5.100 5.110 5.120 5.130 Summary of Districts ...................................................................................................39 Land Uses in the RT-35 and RT-50 Districts ..............................................................41 Development Standards RT-35 and RT-50 Districts ..................................................43 Restrictions for Specific Uses in the RT-35 and RT-50 Districts ................................46 Floor Area Bonuses in the RT-35 and RT-50 Districts ................................................48 Affordable Housing Requirements in the RT-35 and RT-50 Districts .........................51 Nonconforming Uses and Facilities in the RT-35 and RT-50 Districts .......................52 Parking Regulations in the RT-35 and RT-50 Districts ...............................................57 Performance Standards in the RT-35 and RT-50 Districts .................................: .......58 Transfer of Development Rights in the RT-35 and RT-50 Districts ............................59 Historic Preservation in the SOFA 2 Area ..................................................................62 Regulations for SOFA 2 Planned Community Districts ...............................................62 Environmental Protection ............................................................................................64 9.30.02.FINAL SOFA CAP P&TC Version.doc ii October 01,2002 Chapter 6: Implementation ..............................................................................................67 6.010 6.020 6.020 (a) 6.020 (b) 6.020 (c) 6.020 (d) 6.020 (e) 6.020 (f) 6.020 (g) 6.020 (h) 6.020 (i) 6.020 (j) 6.030 6.040 6.050 Joint ARB/HRB Review Board .................................................................................................67 Permits, Exceptions, and Review Procedures .........................................................................67 New Construction ........................................................................................................67 Conditional Uses .........................................................................................................67 Exceptions to Development Standards .......................................................................68 Review of new construction or alteration of non-historic structures ...........................68 Review of Projects on SOFA 2 Historic Resources ....................................................68 Review of Projects near actual or potential SOFA 2 Historic Resources ...................68 Projects on SOFA 2 Potential Historic Resources ......................................................69 Staff Review of Small Projects on or near SOFA 2 Historic Resources .....................69 Administrative Approval of Minor Changes in Projects ...............................................69 Subdivisions, Parcel Maps, and other Land Divisions ................................................69 Plan Amendments ....................................................................................................................70 Establishment of Planned Community Districts .., ....................................................................70 SOFA 2 Historic Resource List Addition and Removal Procedures ........................................74 Appendices Appendix A: SOFA2 District Map Appendix B: SOFA 2 Historic Resources and Seismic Hazards B-1 : SOFA 2 Historic Resources B-2: Potential SOFA 2 Historic Resources B-3: SOFA 2 Seismic Hazards Appendix C: Definitions C-1 : SOFA 2 Definitions C-2: PAMC Chapter 18.04 - Definitions Appendix D:Preferred Trees for the SOFA 2 Area Appendix E:SOFA 2 Area Economic Studies Appendix F:Applicable Capital Improvement Program Projects F-l: Homer Ave. Railroad Undercrossing F-2: Homer Ave. and Channing Street Improvements and Traffic Calming Appendix G:Regulations for R-2, RM-15, RM-30, and Specific PC Districts in the SOFA 2 Area G-l: R-2 District G-2:RM-15 District G-3:RM-30 District G-4:PC-2967 G-5:PC-3707 G-6:PC-4283 G-7:PC-4389 Appendix H: Referenced Palo Alto Municipal Code Review Procedures H-l: Chapter 18.90: Variances, Home Improvement Exceptions, and Conditional Use Permits H-2: Chapter 16.48: Architectural Review 9.30.02.FINAL SOFA CAP P&TC Version.doc iii October 01,2002 TABLE OF FIGURES MAPS AND FIGURES Map 1: Map 2: Map 3: Map 4: Map 5: Downtown monitoring area, parking assessment district, (GF) district, and SOFA 2 area boundaries ...................................................................................................3 Existing Traffic Patterns .................................................................................................15 Potential Traffic Patterns ................................................................................................16 Existing and Proposed Bicycle Routes .........................................................................19 SOFA 2 Historic Resources ............................................................................................25 . TABLES Table 1 : Table 2: Table 3: Table 4: Table 5: RT District Permitted and Conditionally Permitted Uses ............................................41 RT District Site Development Standards ......................................................................43 RT District Use Categories. ............................................................................................46 RT District Historic Rehabilitation Bonuses .................................................................48 RT District Required Parking ..........................................................................................56 9.30.02.FINAL SOFA CAP P&TC Version.doc iv October 01,2002 Chapter I Introduction Chapter I: Introduction A. Purpose of the Coordinated Area Plan The Coordinated Area Plan (CAP) is intended to create enhanced opportunities for building a sense of community through public involvement in planning processes that provide residents, businesses and property owners with early and meaningful opportunities to help shape the physical components of their neighborhoods and community. At the commencement of the first phase of the CAP process, the City Council appointed a fourteen member Working Group to represent the broader interests of the community and to develop a vision for the South of Forest Area (SOFA). The Working Group’s major focus was the development of plans for the use of the approximately 10 acres made available by the recent relocation of the Palo Alto Medical Foundation (PAMF) facilities from the SOFA area to El Camino Real. In June of 1999, the Working Group published a draft Coordinated Area Plan that divided the SOFA area into two areas, Phase 1 and Phase 2. Plans for the Phase 1 area, where most of PAMF’s holdings were located, were to be finished first, permitting the owners of those parcels to commence development without waiting for completion of plans for the Phase 2 area. In March of 2000 the City Council adopted the SOFA CAP, Phase I and a Development Agreement to define future land uses in the approximately 9-block portion of the SOFA area in which most of PAMF’s holding were located. As part of the Development Agreement, the City acquired title to the historic Roth Building, land for a new public park, a site for a child care facility, and a site for a below market rate housing project. The City granted approval for 160 new dwelling units and 30,000 square feet of retail and office space. The Working Group, without the owners of the Palo Alto Medical Foundation parcels, continued to participate in the second phase of the planning effort, known as SOFA 2. Phase 2 of the SOFA CAP is a long-term Plan that addresses a specific nine block area (approximately 19 acres) bounded by Forest Avenue on the north, Addison Avenue on the south, Alma Street on the west and Ramona Street on the east (See Map A). It serves both as the Comprehensive Plan and use designation and zoning for the area. Although some of the goals and policies are the same for Phase 2 as Phase 1, the Phase 2 CAP is an independent document that does not rely on Phase 1 for its direction or implementation. It is a document that is intended to preserve the primary features of the existing character of a unique area within the City of Palo Alto. A major impetus for Phase 2 of the CAP was the emergence of substantial new development in the commercial portions of the nine-block area. These new developments generally included commercial office and residential uses in denser developments than the existing automobile-oriented service uses, which previously dominated the area. High land values, high tech related employment growth, and the limited opportunity for growth in commercial districts throughout the downtown has fueled this development trend. These conditions are likely to result in continued development pressures in the area, which could damage the neighborhood-serving character of many of the retail and service uses throughout the area. In addition, the proximity of the area to the train station and downtown makes the SOFA 2 area a 9.30.02.FINAL SOFA CAP P&TC Version.doc 1 October 01,2002 Chapter I Introduction good location for housing opportunities. Therefore, Phase 2 of the CAP specifies the appropriate land use pattern and intensity of development in the nine-block area and addresses such concerns as: compatibility of development with existing uses; parking; traffic; recreation/open space; preservation of neighborhood-serving uses; increased housing opportunities; architectural/design issues; development standards; the relationship between the SOFA Phase 2 area and the Downtown; and new land use designations. B.Relationship Between the SOFA CAP and Other City Plans and Ordinances The CAP implements the City of Palo Alto Comprehensive Plan and provides more detailed programs and policies for the specifically defined SOFA Phase 2 area. These policies and programs are consistent with those found in the Comprehensive Plan, but address the unique characteristics of the SOFA Phase 2 area. The CAP provides the zoning for the area, supplementing Title 18 Zoning of the Palo Alto Municipal Code (PAMC)o In the case of a conflict between the CAP and the PAMC, the CAP prevails. References to the PAMC are to the PAMC as amended from time to time, unless otherwise noted. Appendices G and H contain relevant sections of Title 18, and shall be updated without further Council action as the PAMC is updated. Co Relationship of SOFA to Downtown Commercial District Policy L-8 of the Comprehensive Plan and Map L-6 limit the non-residential development in the Downtown Commercial Growth Monitoring Area, which for this purpose includes parts of the SOFA 2 area, to 350,000 additional square feet above the square footage existing in May 1986. This limit will be reevaluated when development approvals reach 235,000 square feet of floor area. As of January 2002, a total of 116,000 square feet (33% of the additional square footage allowed) has been added to the Downtown area since 1986, leaving 234,000 square feet remaining under the cap. The area in the Downtown Growth Monitoring Area is shown in Map 1. While the SOFA 2 area is included in the Downtown commercial square footage limit, only a few parcels northwest of Forest Avenue are included in the Downtown Parking Assessment District, also shown on Map 1. Property in the Downtown Parking District may.pay fees to the district in lieu of providing required parking on site. Past land uses in the SOFA 2 area have not lent themselves to participation in the assessment district due to low development intensity, the physical and operational requirements of many service uses in the area, and the lower property values and associated rents relative to the downtown. SOFA 2 has also been outside the area subject to ground floor (GF) use restrictions found along the primary streets downtown, as shown on Map 1. However, in the fall of 2001, SOFA 2 was included in a citywide ordinance that restricted co.nversion of ground floor retail, service, and residential uses to office uses° Most of the uses in the SOFA 2 area have traditionally supported the uses downtown and the SOFA 2 area is not expected to compete with the downtown for type or intensity of land use. 9.30.02.FINAL SOFA CAP P&TC Version.doc 2 October 01,2002 The City o f Palo A1 to PLANNINO DIVISION SOFA II Boundary Downtown Parking Assessment District Downtown Monitoring CD Zones Downtown Parking Assessment District and SOFA II 0’100’ 500’ Chapter I Introduction SOFA 2 includes 4 existing Planned Community Zones, which include 123 units of housing and approximately 6,225 square feet of office and retail development. These PC districts are not rezoned by the CAP; the provisions of the PCs are included in the CAP. However, redevelopment of any of those sites is subject to the CAP. D. Organization of the CAP The Coordinated Area Plan contains six chapters and a number of appendices which are described in more detail below. Chapter I, Introduction: contains the Purpose of a CAP, a brief description of the relationship between the two phases of the SOFA CAP and how the CAP relates to other City Plans and Ordinances, and outlines the organization of the document itself. Chapter II, Vision: provides the land use and development concepts for the area within Phase 2 of the CAP. Chapter III, Policies: including Land Use, Housing, Transportation, Community Facilities, Design Opportunities, and Street Trees and Landscaping. All development proposals within the Phase 2 Plan area must be consistent with these policies and the associated development standards. Chapter IV, Compatibility Requirements and Design Guidelines: provides guidance regarding architectural and urban design encouraged in SOFA 2 area for public and private land. The provisions of this chapter are among the standards used by the City during any discretionary design review of development in SOFA 2. Chapter V, Development Standards: provides specific site development requirements. These are mandatory zoning standards; deviation from them require a design exception during review by the Architectural Review Board, or a Planned Community zone change as described in Chapter VI. Chapter Vl, Implementation: defines the review process for development proposals and the process for considering exceptions to the development standards along with information about amending the CAP. Appendices: Appendices A, B, C-1, and D are regulatory. Appendix B may be amended by the Director of Planning and Community Environment pursuant to the procedures in Section 6.050. Appendices E and F are also part of the Coordinated Area Plan but are informational. Appendices C-2, G and H, which reproduce relevant portions of the Palo Alto Municipal Code, are included for information purposes only and will be updated as the Municipal Code is amended. Appendix A:SOFA 2 District Map Appendix B:SOFA 2 Historic Resources and Seismic Hazards Appendix C:Definitions 9.30.02.FINAL SOFA CAP P&Tv~ version.doc,~’~October 01,2002 Chapter I Introduction Appendix D: Appendix E: Appendix F: Appendix G: Appendix H: Area Preferred Trees for the SOFA 2 Area SOFA 2 Area Economic Studies Applicable Capital Improvement Program Projects Referenced Palo Alto Municipal Code Review Procedures Regulations for R-2, RM-15, RM-30, and Specific PC Districts in the SOFA 2 9.30.02.FINAL SOFA CAP P&TC Version.doc October 01,2002 Chapter II Vision Chapter II - Vision The vision identified by the Working Group for the SOFA 2 area is eclectic and diverse. It has six major components including: preserving and enhancing the existing pedestrian scale of the area and the walkable character of the quiet residential neighborhood immediately adjacent to the SOFA 2 area; enhancing the neighborhood- serving character of the retail and service uses in the area; supporting physical change provided that new buildings and additions are compatible with (see Chapter IV for definition of compatible) and complement the character of existing buildings; increasing housing opportunities, especially because of the proximity to the train station and downtown; preserving the existing quiet, calm streets, which are conducive to walking, and biking and calming the existing one-way streets; and supporting a mixture of uses including increased housing opportunities along with retail and small offices. The existing retail and commercial uses along Homer and Emerson Streets are highly valued and there is great support for preserving and enhancing these uses. There is an equally strong desire to decrease the general dependency on the automobile and take advantage of the area’s proximity to the downtown train station. The livability and the walkability of the neighborhood will be preserved and enhanced through the maintenance of pedestrian-scale urban design improvements, the calming of traffic on area streets, and the creation of new housing for a variety of household types. Preserving and enhancing the existing streetscape is especially important and will be accomplished through application of the development standards and design guideli~nes presented in the Plan, which encourage design features and require building locations that facilitate interaction between the street and the pedestrian. The area’s traditional grid street pattern, pedestrian-oriented buildings, mature tree canopy, and mix of land uses will also be preserved. As the area is redeveloped and open spaces are provided and enhanced, they should be landscaped and planted in a manner that increases the tree canopy and vegetation in the SOFA 2 area. The Plan recognizes SOFA 2’s location near downtown and the train station and calls for higher density hodsing and other development in a vibrant mixed-use area adjacent to the more intensive Alma Street Corridor and downtown areas and within walking distance of the train station. This concentration of higher density housing will also be within walking distance of the social opportunities and commercial services provided in the downtown. This vision is implemented in the Policies, Design Guidelines and Development Standards within the SOFA 2 Coordinated Area Plan. 9.30.02.FINAL SOFA CAP P&TC Version.doc 6 October 01,2002 Chapter III Land Uses (L) Policies Chapter ill - Policies The following chapter includes policies for the SOFA 2 Plan Area related to land uses, housing, traffic and circulation, community facilities, design character and street trees and landscaping. These policies state the expectations for the area and provide direction to those responsible for reviewing proposed projects within the area. Land Uses (L) To achieve the community described in the Vision statement above, the Plan includes the opportunity for combined residential and commercial development. Most increase in intensity will be for residential uses. 1. General Land Use Policies: POLICY L- 1: Promote varied residential development and neighborhood services while sustaining the character and vitality of the commercial and public facilities. POLICY L=2: Enhance desirable characteristics and uses by using planning and development standards to create opportunities for neighborhood development. Encourage a compatible transition from the residential neighborhoods to the downtown. Emphasize the addition of new open spaces and plantings that improve the tree canopy and other vegetation in the area. PROGRAM L-l: Develop a comprehensive Transfer of Development Rights (TDR) program for the SOFA 2 area to provide incentives for historic and seismic rehabilitation, and other desirable characteristics and uses including pocket parks and other public open space 2. Neighborhood-Serving Commercial Uses The distinct character of the SOFA area is created by its role in providing commercial services to the downtown area, such as auto repair, along with lower cost office space and convenient neighborhood-serving uses such as a grocery store, hardware store, gymnasium, day spa, and restaurants, The distinct character of the SOFA commercial and mixed use area is further enhanced by its role in serving downtown employees and visitors. The continuation of these uses will be encouraged due to their neighborhood serving functions. Some ground floor office use will remain as existing nonconforming uses but new office uses will be limited in square footage, will not be permitted facing a street, a~d will be required to be convertible to retail use. Impacts from commercial uses and mixed-use residential projects will be reduced with the application of the development standards and design guidelines. ~ CAP9.30.02.FINAL SO, A P&TC Version.doc 7 October 01,2002 Chapter III Land Uses (L) Policies POLICY L-3: Create an active commercial center for the South of Forest Area by encouraging neighborhood-serving businesses to locate along Emerson Street and Homer Avenue. POLICY L-4: Encourage pedestrian activity along Emerson Street and Homer Avenue through uses that include retail, personal service and restaurants. Incorporate frequent building entrances, storefront windows, pedestrian-scale signage, and outdoor activity spaces into new development in the entire SOFA 2 area to create a lively, pedestrian-friendly environmenL POLICY L-5: Permit existing commercial uses to remain. Encourage new neighborhood, and pedestrian oriented commercial uses in existing buildings and new mixed-use development. Phase 2 of the SOFA Plan anticipates that the Residential Transition districts in SOFA 2 will become much more of a mixed use area with substantial residential development next to or combined with office and commercial uses. This type of development is strongly encouraged in the City’s 1998-2010 Comprehensive Plan as an opportunity to create neighborhoods that are made more interesting and livable by providing the following: 1) a variety of activities taking place; 2) the ability to be active both day and night; 3) the opportunity for a rich texture of architectural and urban design; and 4) the easy accessibility of commercial service to residents and employees of the area. The standards and regulations in Chapters IV and V are designed to result in the development of substantial quantities of housing. So long as great care is given in project design to ensure compatibility between residential and other uses, the area is considered an ap’propriate location for higher density residential development. By concentrating future neighborhood serving businesses in the Phase 2 area, the vitality of the existing hub will be reinforced and a wider array of services will be possible. While the Plan does not forbid residential uses along Homer Avenue and Emerson Street, it does provide opportunities for small-scale neighborhood serving retail and reduced parking requirements for historic commercial buildings to reflect- their reliance on pedestrian access and the constraints of reusing those historic buildings. Transparent storefronts or window displays, frequent entries, and other measures to increase visual appeal for pedestrians, regardless of the use of these properties, are included in the design review guidelines in Chapter IV and the development standards in Chapter V. The economic analysis for the plan cautioned that the market for retail and service uses in the area is limited due to the proximity of the area to Downtown and the limited neighborhood population. However, the market for neighborhood local retail and service uses will improve with the private redevelopment facilitated by the Plan due to increased number of residents and employees in the area. Residents have expressed the desire to maintain and encourage additional local serving commercial uses in the area. Therefore the plan allows for that type of development. 9.30.02.FINAL SOFA CAP P&TC Version.doc 8 October 01,2002 Chapter III Land Uses (L) Policies 3. Mixed~Use Development: POLICY L-6: Enhance the vitafity and livability of the South of Forest Area by allowing a mixture of residential and neighborhood serving commercial land uses. This plan provides development standards and design guidelines to facilitate in-fill residential and mixed-use development while continuing a broad range of compatible service commercial uses within the SOFA 2 area and by incorporating measures to reduce noise, visual and otherconflicts between such uses, which include auto-related uses. The responsibility for ensuring compatibility with legal existing land uses and activities is placed on new development, and not existing uses. 4. Automobile and Other Service Uses The long-standing presence of several automobile and other service uses in the area is very valuable to the City. The presence of these business uses is a great convenience to local residents and downtown workers, and opportunities to locate such uses are limited in the rest of the City. The SOFA 2 Plan encourages existing automobile and service uses in the area but limits new automotive uses to Alma Street and the west side of High Street, with conditional use permits to ensure compatibility with surrounding land uses. Assuming that all the activities at the existing automobile and service uses are operating legally, the responsibility for resolving issues that arise from incompatible land uses locating on adjacent properties will rest with new development. However, new automobile or other service uses will also be responsible for addressing compatibility issues. POLICY L-7: Enhance the character of the South of Forest Area by ensuring that new residential development is compatible with existing residential areas and incorporates measures to minimize potential nuisance conflicts with existing commercial land uses. Housing (H) The City of Palo Alto is confronted with a well-documented phenomenon related to the continually rising cost of housing. Phase 2 of the SOFA Plan seeks to provide for more modest homes through the provision of less expensive, attached housing units in residential and mixed-use projects. Phase 2 also addresses the well-documented need for "affordable" housing in Palo Alto special provisions for certain types of housing such as. single room occupancy (SRO) facilities or senior housing facilities. Projects including affordable housing are required to meet the same development standards (except for residential density) and the same design guidelines as market rate housing projects and are required to incorporate design features to ensure compatibility with the SOFA area. The area within Phase 2 of SOFA provides increased housing opportunities convenient to shops, services, and transit. The Comprehensive Plan recommends the creation of a substantial number of new residential units near the downtown, 9.30.02.FINAL SOFA CAP P&TC Version.doc 9 October 01,2002 Chapter III Housing (H) Policies responding to the city’s housing shortage and the area’s proximity to transportation opportunities. The concentration on residential uses maintains the overall character of this area and helps create the transition to lower density residential areas to the east and south. 1. Housing Quantity and Density Policies: POLICY H- 1: Within the SOFA area, Phases 1 and 2, provide for a total of 300 residential units and promote the retention of existing housing units and encourage the development of new housing units throughout the South of Forest Area. POLICY H-2: Use the SOFA 2 area as a transition between the existing single-family uses south of the Phase 2 area and the commercial uses in the downtown area to the north by providing opportunities for medium and high density multiple family housing within the Phase 2 area. POLICY H-3: Provide for increased residential densities including additional lower cost ownership and rental housing within traditional historic housing types. 2. Variety of Housing Type Policies: POLICY H-4: Allow a variety of housing types in the SOFA 2 area, including, but not limited to, the following: units in a mixed-use configuration; apartments; townhouses; and studio units. POLICY H-5: Housing types in the plan area should be suitable for various ages, household sizes, lifestyles and incomes. Phase 2 of the SOFA plan includes a range of housing options, including mixed use housing, apartments, condominiums, and affordable housing to enable new residents the benefit of being in an area with convenient access to downtown, jobs, transit and services. 3. Affordable Housing Policies: Provision for the allowance of affordable housing is incorporated into Phase 2 of the CAP pursuant to the current Below Market Rate housing program. POLICY H-6: Preserve existing affordable housing opportunities within the South of Forest Area and expand the supply of affordable housing units. PROGRAM When applicable, negotiate Below Market Rate (BMR) agreements with property owners to comply with Program H-20 of the Comprehensive Plan. ,:,.30.0,_.FINA,_ SO, A CAP P~,TC Version.doc I0 October 01,2002 Chapter III Housing (H) Policies Program H-20 of the Comprehensive Plan sets forth priorities for compliance with the Below Market Rate (BMR) program by developers. The primary objective of this BMR program is: "to obtain actual housing units or buildable parcels within each development rather than off-site units or in-lieu payments". Palo Alto’s Below Market Rate Housing program requires all developers of projects of more than 3 for-sale units or 5 rental units to develop at least 10% of the units using specific affordability criteria, or in some cases, to pay a fee in-lieu of providing BMR units. These requirements are subject to change as the Comprehensive Plan Housing Element as amended from time to time. POLICY H-7: Strongly encourage retention of existing housing, particularly traditional housing structures, rental and other housing that is affordable in an area where land and construction costs have made this retention difficult. POLICY H-8: Increase the possibility of developing housing in a mixed-use configuration by making residential development standards more compatible with existing non-residential development standards. Transportation (T) The SOFA area offers an unusually varied set of transportation options. A traditional grid street pattern with a mixture of uses and moderately dense, pedestrian-oriented residential and commercial development h.elps to support alternatives to automobile use. Walking and bicycling within the area on flat tree-lined streets is pleasant and convenient. The bicycle boulevard passes through SOFA 2 on Bryant Street, and part of the segment of Addison Avenue that passes through the Plan Area has a designated bike lane. Bus and train service is within a fifteen-minute walk of the outer boundaries of SOFA 2 and provides transportation throughout the Peninsula, South and East Bay. A one-way street couplet including Homer and Channing Avenue has facilitated heavy through-traffic across SOFA to the major sub-regional arterials of Middlefield and Alma. This roadway system has provided good automobile access but has also resulted in relatively higher volumes and increased speed of traffic. This topic is discussed in more detail in the "Traffic Patterns" section of this Plan. The policies in this chapter address six transportation issues in the SOFA 2 area. These include trip reduction, transit oriented development, parking management, traffic patterns, transit service, and bicycle and pedestrian circulation. 1. Trip Reduction Encouraging use of the many alternatives to automobile access in the SOFA 2 area is the single most effective way to reduce transportation impacts on the area while providing safe and convenient access. The area has excellent transit, bicycle and pedestrian access, and proximity to a variety of retail, employment, housing opportunities, and community facilities. Reinforcing the mixed land use pattern will 9.30.02.FINAL SOFA CAP P&TC Version.doc ! 1 October 0 ! ,2002 Chapter III Policies Transportation (T) increase the viability of transportation alternatives and reduce the need for automobile use. These efforts need to be coordinated with comprehensive downtown transportation management efforts to be fully effective. POLICY To1: Reduce vehicle use in the Downtown and SOFA II area, where development patterns support transportation alternatives such as walking, biking and transit use. PROGRAM T=I: Through the Transportation Division, coordinate SOFA 2 trip reduction efforts with Downtown trip reduction efforts, including shuttle service, transit service and other projects. Establish a citywide Transportation Demand Management program that is integrated with the SOFA 2 area. POLICY T-2: Provide 5% reductions in commercial parking requirements for developers who complete all of the following: 1) require commitments from all commercial tenants to provide financial incentives to employees for not driving to work or who participate in the Santa Clara Valley Transportation Authorities Eco-Pass free transit program or commuter check program, 2) pay annual fees to support Downtown/SOFA 2 Transportation Management programs and monitoring by the City, and 3) submit annual monitoring reports to the City on implementation of these incentives and employee travel behavior. PROGRAM T=2: Support the continuation of a full time City of Palo Alto Transportation Management Coordinator for the downtown area (including SOFA 2), with responsibility for promoting trip reduction efforts, reviewing requests for parking reductions based on Transportation Demand Management (TDM) plans, and monitoring the success of trip reduction programs based on data provided by SOFA and downtown employers. The Coordinator would develop guidelines for approval of parking management, employee trip reduction incentives, and other programs proposed by developers and tenants of mixed use and other projects within the Plan Area. In Silicon Valley and other Bay Area locations, financial incentives that pay employees cash for not driving to work, or provide credits toward transit or bicycling costs, have been shown to reduce auto use by 15-30% depending on the size of the cash incentive. 2. Transit Oriented Development POLICY T-3: Pursuant to the 1998-2010 Comprehensive Plan, encourage transit-oriented development by allowing greater housing density in areas located nearest to major transit routes providing access to housing and employment centers. The permitted commercial, residential, and mixed use floor area ratios provide a combined development potential that locates both housing and jobs within walking distance of the Palo Alto CalTrain Station and regional bus routes such as the Dumbarton Express. Mixed use, transit-oriented development of this type will increase the amount of housing and employment located close to major transit services, increasing the attractiveness of transit throughout the region. :9.30.02.FINAL SOFA CAP P~, ,., Version.doc 12 October 01,2002 Chapter III Transportation (T) Policies 3. Parking Management Presently, there is a parking shortage at peak periods in the downtown and SOFA, which in turn affects adjacent residential areas. This demand is predominantly generated by downtown and SOFA visitors and employees, and by SOFA residents. The shortage will be reduced when the two proposed downtown parking structures are constructed (expected completion for the garage on High Street (Lot R) is late Spring 2003 and for the garage on Bryant Street (Lots S and L) is Winter 2003). Phase 2 of the SOFA Plan addresses the parking shortage by requiring that new development, except that located in the Downtown Parking District, provide onsite parking and share parking facilities where appropriate. The relocation of the Palo Alto Medical Foundations (PAMF), and some existing commercial development in the Phase I area of SOFA, combined with new development that provides adequate parking is anticipated to ease the parking shortage in the area. The SOFA 2 CAP. provides for limited reductions in parking when appropriate conditions exist (i.e., when a project can utilize shared parking for different uses with different peak demand periods or it is within walking distance of the transit station, or it provides all affordable or senior housing units, etc.). Parking incentives are also provided to encourage ¯ renovation of historic structures and their adaptive reuse. POLICY T-4: Encourage shared parking for all uses with different peak hour parking demands and provide parking reductions of up to 20% for mixed-use projects with a housing component that have shared parking facilities and offset peak hour parking needs, and parking reductions of up to 15% for projects with multiple commercial uses that have shared parking facilities and offset peak hour parking needs. Uses with offset peak parking needs can share parking facilities, resulting in lower land and construction costs for parking, and less visual impact of parking lots and structures. This. policy will be implemented through an existing City regulation in the parking regulations in Chapter 18.83 of the Palo Alto Municipal Code that allows a 20% reduction in the number of spaces that would otherwise be required for each use separately. For mixed-use projects combining housing with retail and office uses with offset peak requirements, this reduction could be up to 20%. If a project proposes incentives for trip reduction that will further reduce parking demand, such as employee transit passes or separate charges for residential or employee parking spaces, an additional 5% reduction could be approved. POLICY T-5: Reduce impacts on residential areas adjacent to SOFA 2 area from the parking impacts of the downtown area and the Residential Transition Districts by encouraging shared parking facifities and below grade parking. POLICY T-6: Decrease the adverse visual impacts of surface parking and street level parking garages by encouraging parking for mixed use and multi-family residential parking to be either underground or otherwise not visible from adjacent roadways through the use of ........Ver~o~.uot;13 October 01,2002 :i9.30.uz.rhqAL SOfA ~Ar P&TC ..... Chapter III Transportation (T) Policies landscape screening. Allow parking reductions and flexibility for historic buildings to avoid conflicts between preservation and provision of parking. POLICY T=7 Encourage an increased amount of short=term on-street parking for retail and commercial uses. 4. Traffic Patterns The Plan Area is affected by Downtown and through traffic as well as neighborhood- generated traffic. For several decades, Homer and Channing Avenues have formed a one-way couplet three to four blocks south of University Avenue. As a result of the one-way designation, Homer and Channing Avenues are attractive opportunities to bypass downtown at higher speeds than the two-way streets closer to Downtown, such as Forest Avenue. Maps 2 and 3 show the existing and potential traffic patterns in the SOFA 2 area. The fast-moving traffic on Homer and Channing Avenue is a concern for pedestrians, bicyclists and vehicles attempting to exit the driveways of homes. Residents along Homer Avenue have expressed the concern that the volume and speed of traffic along the street makes safe and convenient exiting from their driveways, especially when they must back up into the traffic flow, difficult. Consideration was given to returning these streets to two-way flow in order to calm traffic and maintain the residential character of the area. Returning the streets to two-way travel would affect circulation around the commercial uses in SOFA 2 closer to Alma Street as well as outside SOFA 2. Truck access to various commercial uses frequently requires wide turning movements that can be more easily accommodated on one-way streets. Deliveries to Whole Foods Grocery Store and other nearby commercial uses are often accomplished by trucks double-parking along Homer Avenue which blocks one traffic lane. That same area has a pedestrian crossing at mid-block to the Whole Foods parking area. Additional concerns were also raised by the residents of the Channing House, located just outside the plan area, regarding their ability to safely enter and exit their underground parking garage if Channing becomes a two-way street. The Working Group endorsed the conversion of Homer and Channing Avenue and a portion of High Street from one-way to two-way traffic flow, with the caveat that this conversion should not adversely affect the needs of Whole Foods and the Channing House. The issue will require further analysis, which will be conducted at a future date. It should be noted that traffic calming measures could be implemented whether Homer and Channing Streets remain one-way or become two-way streets. The City of Palo Alto Five Year Capital Improvement Program (CIP) calls for street improvements and traffic calming measures such as speed tables and bulb-outs along Homer and Channing Avenues. In addition, the CIP project includes bike boulevard improvements, street furniture, and accessibility improvements. These improvements are scheduled for construction in fiscal year 2004/05. 9.o0.02.FhqAL o~JrA uAP P&TC Version.doc 14 October 01,2002 Isofa II oneway strts Sofa II Boundary The City of Palo Alto Map 2 SOFA II Existing Traffic Patterns This map is a product of the City of Palo Alto GIS Sofa II pot2way strts Sofa II Boundary The City of Pato Alto Map 3 SOFA II Potential Traffic Patterns This map is a product of the City of Palo Alto GIS 713’ Chapter III Policies Transportation (T) Phase 2 of the SOFA plan is consistent with the City of Palo Alto’s CIP in that the Plan encourages further study of traffic calming measures, which could include: pedestrian bulb-outs, traffic lane narrowing and conversion to two-way flow. POLICY T-8: Study ways of calming traffic on Homer and Channing Avenues that could include, but not be limited to, pedestrian bulb.outs, traffic lane narrowing or conversion to two-way flow. Consider converting a portion of High Street to a two-way traffic circulation pattern where appropria te. POLICY T-9: Complete further research on the possible installation of a traffic signal and signing improvements if Homer, Channing and a portion of High Street are converted to two way traffic flow. These improvements could include a new signal at Channing and Alma and a southbound left turn lane on Alma at Channing. Coordinate these changes with the improvements to loading and delivery access described below. POLICY T-IO: Assist SOFA 2 businesses in finding safe and convenient ways to accommodate truck deliveries which may be affected by change if the one way street pattern is converted to a two-way pa ttern. POLICY T-11: Future study of the conversion of Homer and Channing Avenues should address the concerns raised by a major grocery store and Channing House, as described in Programs T-3 and T-4 below, in addition to the need for signals and turn lanes on Alma Street. PROGRAM T-3: Coordinate with the major grocery store on Homer Avenue in the SOFA 2 area to reduce current and potential future conflicts of truck loading with two-way traffic on Homer Avenue. These changes may include but not be limited to the addition of loading zones on Homer Avenue and Emerson Street, restrictions in loading hours, increased use of the alley between Homer and Forest, or the evaluation of the redesign of loading facilities within the store. PROGRAM T-4: Coordinate with the Channing House residents, as part of a future Transportation Division study, to improve safety and reduce conflict between trucks loading, traffic on Homer A venue and residents entering and exiting the parking facilities. POLICY T-12: Support necessary and appropriate changes to mid-block pedestrian crossings, including relocation of crossings to nearby intersections, raised pavement, signing to assure that crossings are visible to passing traffic and convenient and safe for pedestrians. POLICY T-13: Maintain the existing alleys between Alma and High Streets and High and Emerson Streets primarily as support for the nearby commercial sites, providing both loading and circulation for local businesses. "9.30.02.FINAL SOFA CAP P&TC Version.doc !7 October 0! ,2002 Chapter I11 Transportation (T) Policies 5. Transit Service Transit service within SOFA 2 is fairly good by Peninsula standards, with a heavily used commuter rail station within 3 to 12 blocks of any part of the Plan Area, a regional express bus to the East Bay, and two local services through the Plan Area, with several others through the nearby downtown area. More frequent daily service and evening and weekend service would increase convenience for transit users. The Marguerite shuttle to Stanford comes within one block of Forest Avenue. The 1998- 2010 Comprehensive Plan also calls for the provision of a shuttle/jitney type bus system to serve Palo Alto. This program has been implemented and provides a shuttle service that travels within close proximity of SOFA along Webster Street. Implementation of this program reduces traffic and parking demands in this area by providing an alternative.to driving. Ridership is generally low on all transit except rail and East Bay bus service, suggesting most residents, employees and visitors have cars available and find few incentives to use public transportation services. Studies show housing and employment near transit and incentives such as free transit passes can increase transit use and discourage auto use; such efforts are supported and encouraged in the SOFA 2 Plan. POLICY T-13: In coordination with Downtown efforts, encourage transit use by SOFA residents, employees and visitors, increasing awareness of available transit service and schedules and working with Santa Clara Valley Transportation Authority (SCVTA), SamTrans, Stanford, and other transit providers to improve service. 6. Bicycle Circulation Bicycling is a convenient transportation method for residents, employees, and visitors to SOFA and those who travel through the area.to nearby destinations. Map 4 shows the existing and proposed bicycle routes. Bryant Street is a bicycle boulevard and Addison Avenue is a bicycle route between Bryant and Guinda Street. The Alma Street sidewalk is currently designated as a sidewalk and bicycle path, but this designation will be removed in the future as planned bike routes are developed. Bicyclists can cross under Alma Street and the railroad tracks using sidewalk bicycle paths at University Avenue and Embarcadero Road. Access to both existing undercrossings is inconvenient. In addition, crossing the railroad tracks and El Camino Real at University Avenue is complex and can be hazardous. A new undercrossing of the railroad tracks at Homer Avenue and Alma Street will be constructed by the City of Palo Alto to correct the existing situation. In addition, Homer Avenue is recommended to be designated a bicycle boulevard in the Draft Bicycle Transportation Plan. The new undercrossing will involve the construction of a bicycle and pedestrian tunnel under the railroad right-of-way that would connect the area around the Palo Alto Medical Foundation (PAMF) with the SOFA and Downtown areas. Entry/exit features will be constructed on the Alma Street side and at the PAMF side of the railroad tracks. Both entry/exit features will be setback from the street on the Alma side and from bicycle paths on the PAMF side. Stairways and Americans with Disabilities Act compliant ramps will be integrated with new landscaping at the access points to the 9.30.02.FINAL SOFA CAP P&TC Version.doc 18 October 01,2002 Proposed Legend Bike Boulevard Bike Route Bike Lane Bike Path Bike/Ped Bddges or Tunnels SOFA II Boundary The City of Palo Alto Map 4 SOFA II Existing and Proposed Bike Network This map is a product of the City of Palo Alto GIS 500’ This doc~me nt ts a graphic to~’eson~atJon oNy o[ b~st awilabl~ sources, Chapter III Transportation (T) Policies tunnel. The tunnel will also incorporate lighting features and design enhancements to promote safety and reduce the perception of the tunnel as a long, dark enclosed corridor. Feasibility and design studies for the undercrossing are included in Appendix F of this document. POLICY T-14: Provide safe and efficient bicycle routes consistent with the proposed bike/pedestrian undercrossing of the railroad tracks. These routes should provide connections between the SOFA, Downtown, and nearby schools, shopping centers, transit centers and employment centers. PROGRAM T-5: Revise bicycle routes in the Plan Area to provide a bicycle route between the Bryant Street "bike boulevard" and Alma Street using Homer and/or Channing Avenue, or as otherwise recommended by the Palo Alto Bicycle Advisory Committee (PABAC), to connect with the proposed pedestrian bicycle undercrossing at Homer Avenue and Alma Street. Further study of an alternate route is needed if Homer Avenue remains one-way between Alma and Ramona Streets. POLICY T-15: Support the construction of a bicycle/pedestrian undercrossing at Homer Avenue and Alma Street. Facilitate implementation of the recommendations of the Railroad Crossing Feasibility Study to improve pedestrian access from SOFA to the PAMF campus and points west. 7. Pedestrian Circulation Pedestrian access throughout the South of Forest Area is good, with a regular pattern of small blocks. In the commercial areas towards Alma Street, the attractiveness of the pedestrian experience is diminished by areas of narrow sidewalks, missing or stunted street trees and by heavy and fast-moving traffic on Alma Street. Heavy, fast traffic on Homer and Channing Avenue also impacts .pedestrians despite wider sidewalks and large street trees. To improve the safety and circulation of pedestrians and contribute to a walkable neighborhood, Phase 2 of the SOFA Plan encourages traffic calming improvements at key intersections within the plan area. Alma Street and the railroad tracks both form barriers between the area and Stanford University, the new Urban Lane PAMF facility and other areas to the southeast. The proposed pedestrian and bicycle crossing at Homer Avenue and Alma Street would help mitigate these obstacles. POLICY T-16: Improve pedestrian and bicycle connections between and within the Plan Area, the Palo Alto Transit Center, and Stanford University. PROGRAM T=6: Develop a plan for improvements to Alma Street, adjacent streets and key intersections, using bulb-outs, raised walkways, street trees and other measures to improve pedestrian safety and convenience within the plan area and crossing Alma Street, helping to link with the transit center and Stanford. 9.30.02.FINAL SOFA CAP P&TC Version.doc 20 October 0!,2002 Chapter III Transportation (T) Policies POLICY T- 17: Improve access for the disabled throughout the Plan Area. PROGRAM T=7: Complete corner curb cuts throughout SOFA 2, consider the needs of wheelchair users and persons with other disabilities in planning for crossings and other public and private pedestrian improvements in the area. As sidewalks are repaired, applicable ADA requirements shall be satisfied. Community Facilities (CF) Community facilities include public and private facilities that provide services to the ..surrounding community. Among these services are schools, libraries~ open space/public facilities and childcare. Because they are the subject of separate, ongoing planning processes at the School district and City-wide level, this Plan contains no policies or programs related to schools or libraries. However, the issues of schools and libraries related to the Plan area are briefly discussed below. Childcare and Open Space/Parks issues are discussed in more detail with accompanying Plan policies and programs: 1. Schools Potential impacts on schools are addressed in the Environmental Impact Report for the entire SOFA area (Phases I and 2). Demographic changes have resulted in increasing enrollments throughout the city, which are the subject of Palo Alto Unified School District planning efforts. City policy requires that new development be evaluated for its impact on school enrollment relative to existing capacity. However, the City does not discourage new development solely on the basis of impacts to schools, nor can it require new development to address impacts to school enrollment beyond the payment of established school impact fees. The type of housing encouraged in SOFA 2 would yield fewer children than the single-family detached housing allowed in areas of the Phase I plan. 2. Libraries The area is currently served by the Downtown Library, iocated within the study area, and the Main Library, located less than one mile away. Library services are assumed to continue unchanged for the purposes of the Coordinated Area Plan. This issue was also evaluated in the environmental document for the entire SOFA area and was found to have a less than significant impact. 3. Open Space/Public Facilities Scott Park, a 0.4-acre mini-park located off Scott Street near Channing Avenue is adjacent to SOFA 2. The park contains a half court basketball court, a grassy area, playground equipment and picnic tables. The closest developed neighborhood park is 2.0-acre Johnson Park, located five blocks to the north across University Avenue. Kellogg Park, approximately 0.4 acres in size, located just south of Embarcadero OcLouu, u ~,2002~.30.u2.rlN~L SOFA CAP P&,~ Vurs,u,,.uoc 21 Chapter III Policies Community Facilities (CF) Road and the turf area at Addison Elementary School both provide additional neighborhood recreational open space. In addition, the Williams House and gardens, located on Homer Avenue, provides an additional 0.25-acre of city-owned open space within the Plan Area, although presently public access to the space is limited to guided tours during the hours the museum is open. The El Camino Park playing fields, located across from Stanford Shopping Center, are within one-half mile of portions of the Plan Area. In addition to these existing public facilities, a new two-acre public park will be developed by. the City of Palo Alto along Homer Avenue between Bryant and Waverley Streets as part of the implementation Of Phase I of the SOFA plan. This new park will be within easy walking distance of SOFA 2 and will serve as the closest neighborhood park for residents of the area. Along .with these existing and new public facilities, the SOFA area provides opportunities for private development of publicly accessible open space through the development of "pocketparks" or public plazas that are incorporated into the design of a private development. The inclusion of these types of public benefits in private development is encouraged by Policy CF-2 below. POLICY CF=I: Develop Urban Design Plan for improvements in the public right-of-way including street furniture, lighting and other amenities. POLICY CF-2: Encourage private development proposals to accommodate publicly accessible open spaces and connections to other open spaces where feasible. Encourage establishment of usable outdoor pedestrian open spaces, plazas, etc. with pedestrian amenities. Design Character and Guidelines (DC) The goal of the Coordinated Area Plan with respect to Design Character is to create the conditions that will encourage future development to preserve and enhance the original, varied, pedestrian-oriented and generally fine-grained scale of development in the area. In order to do so, the Plan policies address several different issues, including subdivision or lot development pattern, compatibility of new development with existing patterns and historic preservation, the process of development review, and the establishment of design guidelines and development standards. This section of the Plan addresses the visual quality, urban design and distinct character of SOFA 2. This character arises from consistent patterns of physical forms, including the canopy created by the area’s street trees; the size, bulk, mass, height and location of buildings; the type of architecture and age of buildings; as well as from notable exceptions to those patterns. SOFA 2 contains a wide variety of building types, heights, sizes, and styles generally possessing a high degree of visual interest and pedestrian orientation. Styles vary, but the buildings have patterns of entryways, porches and fenestration in common. This section of the Plan addresses key aspects of this character for the SOFA 2 area, 9o30.02.F!NAL SOFA CAP P&TC Version.doc 22 October 01,2002 Chapter III Policies Design Character and Guidelines (DC) including street trees and heritage trees, historic preservation, architectural design and public art. The design guidelines included in the Plan encourage the scale, bulk and mass of buildings and their architectural components to be compatible with that of existing structures in the neighborhood. Heights are generally limited to 35’ with 50’ buildings allowed in the RT-50 District areas along the west side of High Street and along Alma Street where the height of the buildings would be compatible with the width of the street and speed of the traffic. Ground floor designs will provide visual interest such as display windows, porches, storefronts, courts, landscaping, and architectural details. POLICY DC-I: Promote quality design as defined by massing, detail, materials, etc. Implementation of the design guidelines should allow for flexibility and diversity in relation to the overall context of the neighborhood. POL/CY DC-2: With new development, require new street trees, storefront treatment of front facades, pedestrian scale signage, pedestrian/seating, sidewalk widening, and other improvements to improve pedestrian experience throughout SOFA 2. Building articulation, roofline stepbacks and variations, and frequent use of street entry features are all design measures that reinforce the original, finer grain of development in this area. POLICY DCo3: The commercial development in the SOFA 2 area is centered on Homer Avenue and Emerson Street, with many intact buildings remaining. The character of these commercial buildings, with store front entrances and no front or side setbacks, creates a .lively pedestrian environment which should be reinforced by new development, particularly along Emerson Street, which links this area to the downtown. Figure 5 shows some examples of buildings in the SOFA 2area. POLICY DC-4: Incorporate transition techniques into new buildings to blend higher density housing or mixed-use projects into the existing lower density residential housing adjacent to the southeastern portion of the plan area. POLICY DC-5: Permit planned community districts, subject to specific development standards, to permit higher FARs in the SOFA 2 area for residential use. Require planned community districts to provide specific public benefits. Chapter III Policies Design Character and Guidelines (DC) 1. Preserving Existing Buildings and Scale One of the goals of the SOFA 2 plan is to encourage the preservation and adaptive reuse of historic buildings throughout the area. 2, Historic Preservation The SOFA 2 area played a significant role in the early history of Palo Alto and includes a substantial number of historic structures currently listed on Palo Alto’s historic inventory. These structures, and the historic patterns of development they create, contribute to much of the area’s unique and interesting character: The commercial development along Homer Avenue and Emerson Street was the center of a mixed-use district, which provided a variety of essential services to the adjacent downtown and nearby residential areas such as Professorville, a National Register Historic District. The SOFA-area included the residences, businesses and community facilities of a variety of ethnic groups and nationalities. Map 6 shows the locations of historic resources in the SOFA 2 area. Appendix B-1 lists the properties, that have been designated as SOFA 2 Historic Resources. These historic resources are protected by the SOFA 2 CAP. Alterations or additions on these sites must comply with the Secretary of the Interior standards for Historic Preservation. Appendix B-2 lists properties that have been identified as potential SOFA 2 historic resources. When any development is proposed on these sites, they will first be evaluated for historical significance under CEQA. If the site is eligible for the California Register of Historic Resources or the National Register of Historic Places, it will be reclassified as a SOFA 2 Historic Resource. POL/CY DC-6: Require SOFA 2 Historic Resources, which are identified in Appendix B’I, to conform to the Secretary of Interior Standards when undergoing alterations or additions. POLICY DC-7: Require public and private efforts to maintain, preserve, and use historic buildings and other historic resources in order to maintain the scale and character of the area. POLICY De-8: Allow exceptions of up to 25% less than the full parking requirement to encourage reuse of historic buildings for original or compatible uses. POLICY DC-9: Provide information to the public, developers, homeowners etc., on all available historic preservation tax programs, credits and other financial assistance available. POLICY DC-IO: Encourage use of the State Historic Building Code when reviewing proposed modifications to historic structures, and provide information regarding the Code to the public, developers, homeowners, etc. 9.,~0.~2 .....AL ,SO, ,~ ,_,A, P&TC Version.doc 24 ~ ~ ~’~ ~1,2~2 wle St Ramona Street Architectural District Ramona St Emerson St St Alma St M HisLoric Resources ~-a.~ SOFA II Plan Boundary ,,~,u,,M,,,,e,,n~l PAMF/SOFA Plan Boundary SOFA Coordinated Area Plan O’ 100’ 200’ 400’ Historic Resources in the SOFA Area Chapter III Design Character and Guidelines (DC) Policies POLICY DC-11: Promote continuation or restoration of the original use of SOFA 2 Historic Resources wherever possible, but allow adaptive reuse if compatible with preservation of historic features where original use is infeasible. POLICY DC-12: Permit continued non=conforming use of SOFA 2 Historic Resources if necessary to assure preservation and restoration of historic resources. Continuation of the original use or a similar use should be pursued wherever feasible. Established and designated historic resources shall be exempt from the minimum densities outlined in the Plan. POLICY DC-13: Develop a Transfer of Development Rights (TDR) program for historic structures in the SOFA 2 Residential Transition districts which allows development rights to be transferred from historic buildings in the area to eligible receiver sites in either the SOFA 2 Residential Transition districts or the Downtown (CD) area, with the limitation that development rights cannot be transferred to another historic building. POLICY DC-14: Make determinations on historic resources using consultants hired by the city, and for commercial and mixed-use development, paid for by the applicant. 3. Public Art Public art makes a valuable contribution to the urban design of Palo Alto and enriches the built environment and public life. The plan encourages new development in the Phase 2 area to provide public art as a part of the project. POLICY DC-15: Encourage new development to provide pubfic art within all major projects. The art is to be reviewed and approved by the Public Art Commission. Public and Private Trees (PPT) To achieve the city’s tree preservation goals, all development must be consistent with the Citywide Tree Protection Ordinance. The ordinance requires preservation and maintenance of large Coast Live Oaks and Valley Oaks, and Coast Redwoods. Planting of new oaks and redwoods and protection of those not yet large enough to be protected will also help to maintain Palo Alto’s distinctive tree canopy after the inevitable loss of today’s large oaks and redwoods. The Tree Technical Manual establishes standards for removal, maintenance, and planting of trees. In establishing these procedures and standards, it is the City’s intent to encourage the preservation of trees. The South of Forest Area of Palo Alto includes many fine tree specimens growing on public and private property. The area also contains several examples of the two oak species and redwoods that are protected in Palo Alto. These notable trees and the remainder of the urban forest presents both opportunities to build on the area’s distinctive features and constraints for the location of new development within the "a qn no ~k~ SOFA CAP P&TC \~ .....,~~O ....e, ,~ ,,,_0,~2 Chapter III Public and Private Trees (PPT) Policies area. The existing trees provide wildlife habitat, shade, and a dramatic urban design feature and enhance the pedestrian environment. The preservation and enhancement of these resources is essential to maintaining the character of the neighborhood. In order to introduce a healthy diversity of street trees, while producing consistency within a block to create a strong pattern, the street tree species listed in Appendix D should normally be used. 1. Trees on Public Property: POLICY PPT-I: Preserve and protect existing street trees when in compliance with Appendix D or as otherwise approved by the Planning or Public Works Arborist, planning new development so that damage or removal of existing healthy street trees is minimized. POLICY PPT-2: Driveways, walkways and structures should be located to preserve existing street trees wherever possible. Protective measures should be taken in construction and landscaping to assure the continued health of existing street trees. ~POL/CY PPT-3: Any new .development or substantial renovation of an existing building within the Plan Area should consider the replacement of any "missing" street trees at an interval of approximately 20-25 feet on center. POLICY PPT-4: Street tree selection should be in accordance with the proposed street tree species shown in Appendix D or as otherwise approved by the City. POLICY PPT-5: Adopt city policies that require use of structural soil to promote tree growth when sidewalks are replaced. 2. Trees on Private Property: POLICY PPT-6: Protect and maintain Heritage Trees. In addition, promote preservation of Coast Live Oak and Valley Oak, which are not yet large enough to qualify for protection under the Tree Protection Ordinance. Incorporate planting of these native oak species in established open spaces, plazas, etc. and in other appropriate locations in the Plan Area. POL/C Y PP T- 7: Strongly encourage the preservation of significant trees on private property in the plan area when applying the design criteria in Chapter IV. Accessibility (A) The Comprehensive Plan Housing Element and Community Services and Facilities Element emphasize the City’s commitment to providing services and housing for people with special needs, including persons with disabilities. The Fair Housing Act Chapter III Accessibility (A) Policies Amendments of 1988 require requires that local governments make reasonable accommodations in their rules, policies, practices, or services when necessary to afford persons with handicaps equal opportunity for access to housing. The Americans with Disabilities Act gives other rights with respect to commercial enterprises and other public accommodations POLICY A-1 The SOFA 2 CAP shaft be interpreted and applied in a manner that does not deny to persons with disabilities the access to housing and public accommodations that they are guaranteed under federal law. Chapter tV Design Requirements and Guidelines 4.010 Compatibility Requirements Chapter IV - Compatibility Requirements and Design Guidelines Section List 4.010 4.020 4.030 Compatibility Requirements Design Guidelines for Public Property Design Guidelines for Private Property 4.010 Compatibility Requirements (a)New and remodeled structures Compatibility with the existing area is required for all new and remodeled structures in all districts throughoutthe SOFA 2 area. Compatibility is achieved when the apparent scale and mass of new buildings is consistent with that existing in the neighborhood, and when new construction shares general characteristics and establishes design linkages with surrounding existing buildings so that the visual unity of the street is maintained. A compatible building design is one that supports and reinforces the shared architectural and site features of neighboring properties. It is not necessary in an area of coherent architectural or historic character to employ specific styles in new construction in order to achieve compatibility. Other fundamental features of neighboring properties are more important. A contemporary style, for example, can be fully compatible with a historic neighborhood if the new design has taken careful account of the following characteristics of the street and area: (2). (3) (4) (5) (6) (7) siting, scale, massing, materials; the rhythmic pattern of the street established by the general width of the buildings and the spacing between them; the pattern of roof lines and projections; the sizes, proportions, and orientations of windows, bays, and doorways; the location and treatment of entryways; the shadow patterns from massing and decorative features; the treatment of landscaping. With respect to scale, compatibility refers to what is apparent rather than to actual measurements. Buildings can be designed to appear smaller or larger than they actually are by respectively increasing or reducing the articulation of massing and wall surfaces. When articulation is minimal, one’s primary impression is of the building as a whole, and it seems larger and more monolithic. When articulation is increased, the primary impression is of the building’s separate parts perceived one after another, and the building seems smaller and more humanly scaled. (b)Compatibility with historic structures and other existing structures (1)Buildings adjacent to or across the street from Historic Resources must be compatible to the scale and massing of such historic buildings. Chapter IV Design Requirements and Guidelines 4.020 Design Guidelines for Public Property (2) (3) Existing buildings, whether or not Historic Resources, can provide character and scale to new development and should be reused and remodeled rather than demolished when to do so would strengthen the area. Renovated storefronts should be compatible in materials, scale and proportion with Historic Resources and other existing buildings. Awnings and signage should complement and not hide building columns, windows, and other architectural features. Where several businesses exist in a single building, coordination of awnings and sign changes can reduce visual clutter. Section &020 Design Guidelines for Public Property These guidelines for public property development are to be used in designing and reviewing projects on public property, particularly in the public right of way. They may also be useful to designers of private projects. Where there is a number or amount referenced, this is illustrative only. (a)Streets and Alleys (1)Street improvements should facilitate and enhance the pedestrian environment. Desirable features include, but are not limited to, the following: street trees, benches, bus stop shelters, increased sidewalk width, pedestrian open space, public/private open space, and right of way improvements such as bulb-outs and other enhanced pedestrian crossing features. (2) (3) (4) (5) New developments should incorporate design features that encourage pedestrian usage of existing and new alleys, when appropriate. Alleys should connect to other alleys or streets when possible to form a continuous vehicular and pedestrian network. Alleys in commercial areas place service vehicle access and parking away from the street and sidewalks, offering a secondary access to individual parcels and attractive and comfortable streetscapes. The alleys between Alma Street and High Street, and High Street and Emerson Street, provide important support to commercial uses. Continuing their effectiveness in supporting commercial uses is the highest priority for future maintenance and modification of the alleys and in reviewing new development adjacent to them. Improved pedestrian or bicycle access, and use of the alleys to provide access to residential development, are all desirable if this can be done in a way that does not substantially interfere with their primary purpose. In areas where walking is to be encouraged, streets lined with garages are undesirable. Alleys provide an opportunity to put the garage to the rear, allowing the more "social" aspects of the building to be oriented toward the front of the street. Streets lined with porches, entries and living spaces are safer due to visual surveillance. (6)Design of alleys should provide sufficient light to promote nighttime safety. Where alleys intersect streets, adequate sight distances and building setbacks should be provided. 9.30.02.F!NAL SOFA CAP P&TC Version.doc 30 October 0! ,2002 Chapter IV Design Requirements and Guidelines 4.020 Design Guidelines for Public Property (c) (d) (e) (b)Intersections and Crosswalks (1) (2) (3) (4) (5) (6) Intersections should be designed to facilitate both pedestrian and vehicular movement. The dimensions should be minimized while providing adequate levels of service. Intersections should be designed to slow traffic and reduce pedestrian crossing distances. The street system should balance the needs and viability of the pedestrian, as well as the car. Reduced auto speeds improve pedestrian accessibility and safety and can continue to accommodate safe vehicular movement. Minimum curb radius at the intersection will reduce the pedestrian crossing distance, while reducing the speed of the car through the intersection. Crosswalks should be designed to clearly confer the right-of-way to the pedestrian and minimize the crossing distance. Raised crosswalks will be considered where there are no traffic signals. The color and texture of paving materials shall be reviewed and approved by the City prior to installation of such a crosswalk. The paving materials should enhance visibility and minimize hazards such as slipping and tripping. Gateways (1)Gateways should be located at the intersection of Alma Street and Homer Avenue and at the intersection of Ramona Street and Homer Avenue. The gateways denote the entrance into the pedestrian friendly shopping street. (2)Elements of the gateway features, such as materials and form should be used in the street furniture throughout the area. Sidewalks (2) (3) Sidewalks adjacent to new development should include a continuous minimum clear width of 5 feet for pedestrian travel and a minimum overall sidewalk width of 10 feet to the curb line. Where such a sidewalk width is not currently provided, new development should supplement the public sidewalk with an additional setback for the building. Where existing buildings constrain sidewalk widening on private property, developers of the private property are encouraged to widen the sidewalk in the public right of way where possible. Historic sidewalk dimensions should be investigated and incorporated into new development where appropriate, as determined by a site analysis. ¯ Pedestrian Amenities (1)Sidewalk improvements should be grouped so that a minimum 5-foot wide walking area is maintained for pedestrians. Trees, street furniture and outdoor displays and tables should be located either next to the curb, or within 3 feet of the building provided that adequate walkway is preserved. 9.30.02.F!NAL SOFA CAP P&TC Version.doc 31 ~,.t ........00,_ Chapter IV Design Requirements and Guidelines 4.020 Design Guidelines for Public Property (f) (2)Arcades or building setbacks with awnings or shade trees should be provided where sidewalk width is inadequate for anticipated pedestrian and outdoor use. Street Furniture Street furniture should be selected or designed to promote a sense of continuity throughout the area. The design intent is to create a distinctive community character while meeting the user’s needs. (g)Street Parking Street parking should be provided although it will not count towards meeting a private development’s on-site parking requirement. In some cases a street parking space may be deleted to use the area for a landscaped area with a bench or other pedestrian amenity, or for ADA compliance. (h)Landscaping (2) (3) (4) (5) (6) Landscaping should be appropriate for the area, well maintained, and not allowed to create a safety hazard by concealing or overgrowing pedestrian facilities. As the area redevelops, tree canopy and other vegetation should be increased, to create an atmosphere more hospitable to pedestrians and those making use of outdoor spaces. Tree canopy should be used wherever possible to provide shade and weather protection for pedestrians. Adequate room for tree growth should be provided so that tree roots will not damage pedestrian facilities. Landscaping may be used to provide a buffer between vehicles and pedestrians and to screen parking and utility areas. Street tree planter areas along Alma should incorporate Japanese Box Wood borders similar to existing examples along Alma between Channing and Homer Avenues. Streets should be lined with a limited selection of trees, in accordance with the proposed street tree species shown in Appendix D, to give them a unified and distinct image. Adequate sight distances must be maintained to ensure safety. In areas that do not have space for planter strips, the trees should be kept close to the sidewalk to provide shade and should be aligned to visually frame the street. In all cases, trees should be trimmed regularly to accommodate buses and service vehicles. Tree maintenance should be ensured. Shade for the comfort of the pedestrian is key to creating a viable walking environment. Street trees help reduce heat build up from large asphalt areas and create a cooler microclimate. Trees also provide habitat for local birds. (7)Street Trees. (A)Street trees should be planted (at developer’s expense) along the centerline of the planting strip at a maximum spacing of twenty-five (25) feet on center of the entire length of street frontage. Where there Chapter IV Design Requirements and Guidelines 4.020 Design Guidelines for Public Property (i) (J) (B) are existing street trees in good health and condition, they should be protected and incorporated into street tree planting. Species of the shade trees should be as approved by Planning and Public Works arborists; New development or major remodeling of existing development should include planting of 24 inch box street trees (at developer’s expense) to replace any missing or diseased trees. Species should be selected according to Appendix D Street Tree Species Recommendations unless otherwise approved by the Planning and Public Works arborists. Lighting Decorative lighting should be used in the public right-of-way that showcases adjacent buildings. Light fixtures should be attractive elements during the day when they are not illuminated. Public Art Art should be used whenever possible in the public right-of-way to provide visual interest for pedestrians and other passers-by. Chapter V Development Standards 5.010 Summary of Districts Section 4.030 Design Guidelines for Private Property These guidelines for private property development are to be used in design review of projects in the RT Residential Transition zones and provide methods for meeting the compatibility requirements of Section 4.010. Where there is a number or amount referenced, this is illustrative only. The guidelines do not apply to projects that are not subject to design review. (a)Architecture (1) (2) (3) (4) It is strongly recommended that the architectural design and styles of new construction, additions, modifications, etc. reference and enhance the scale, massing and character of the existing architectural and/or historical heritage of South of Forest Avenue area. Contemporary reinterpretations of these styles, which are similar and compatible in style, color, articulation and form are also encouraged. Each style should utilize characteristic roof forms, materials, window treatments, and other details, which should be used consistently throughout the design in order to create a compatible design. Buildings along Emerson Avenue, Homer Avenue and Ramona Avenue should provide a particularly inviting appearance to pedestrians, with high quality materials and landscaping and observance of all the guidelines of this Section 4.030 to improve the pedestrian experience. Publicly oriented uses should be visible through storefront windows from the sidewalk. (b) Paseos Paseos are publicly accessible walkways on private property. (1) Paseos have the potential to be attractive, well-designed, people-oriented places that provide desirable spaces. Paseos, whether publicly or privately owned, should be designed and maintained for general public use. (2)Paseos should be incorporated into new public or private developments where any of the following situations occur: (A)An area open to the public area exists within the interior of a block that should be connected to the surrounding street frontage; (B)Pedestrians are required to walk out of their way to move between public areas on a block; or (C) There are opportunities to make pedestrian connections between residential and commercial areas. (D)Other functions of the paseo (e.g. merchandise delivery, trash collection and fire access) may be considered during the design and development review process. Chapter V Development Standards 5.010 Summary of Districts (c) (d) (e) (f) Entrances (1)Main entrances to buildings are encouraged, with direct visibility from the street. A clear entry path should lead from the sidewalk to the front door. (2)Low hedges, fences or trellises or gateposts are recommended to mark the transition from the public street to common entry to private residential entrance. (3)Ornamental lighting consistent with the building’s architectural style is encouraged to improve the safety, security and attractiveness of the pedestrian entry. (4)Open space, plaza areas, etc., are recommended in association with building entrances. (5)Outside pedestrian seating (benches, for example) is encouraged. The linear seating length is recommended to be equal to 15% of the proposed building linear frontage with a minimum of 12 lineal feet of seating. (6)Trellises, arbors, porte,cocheres or other similar architectural features are encouraged to identify entrances. These may project no more than three feet into the setback area° Height Staggered stepbacks that vary the massing of portions of a building are recommended to encourage diversity in design and assist in increasing the access to daylight from the interior of a building. Massing/building articulation. It is recommended that building mass or facade composition be articulated. Techniques for creating this massing or facade module may include but are not limited to roofline variations and projections or recessed wall surfaces. Driveways (1)Setback of driveways from adjacent properties should be a minimum five (5) feet. (2)The maximum number of curb cuts for one building should be one two-way curb cut or two one-way curb cuts per parcel or for every 150 feet of frontage. The maximum width should be 12 feet for a one-way driveway and 24 feet for a two-way driveway. (3)The maximum grade of ramps should be sixteen percent (16%). (4)Ramps should be a maximum of 20 feet wide. (5)Permeable driveway surfaces should be used where appropriate. 9.30.02.F!NAL SOFA CAP P&TC Version.doc ~vqq October ,,,n’l ,--,-,~,~°nn°, : Chapter V Development Standards 5.010 Summary of Districts (g)Fence and Walls (2) Aesthetically appealing fences and/or walls should be provided along all property lines when needed to screen service areas, and parking areas from adjacent developments. Planting areas established adjacent to a fence or wall should have a minimum width of 5 feet, and shade trees should be planted approximately 25 feet on center. (3)All service areas, sanitation areas/containers, recycling bins, mechanical areas and similar items and functions should be entirely screened. Screening should be a minimum of one foot above the height of the container or similar structure. (h)Landscaping (i) (J) (k) (1)See Section 4.020 for information on street trees and other plantings in the public right-of- way. (2) (4) On sites where existing heritage trees and other significant trees and landscape features exist, new development should be designed to preserve such trees and incorporate them into the open space or other appropriate areas of the development. For summary of City ordinances and requirements and map of such trees, refer to Appendix D of this Plan. Open space/pocket parks. Trees of at least 24-inch box size should be planted in all open spaces at approximately 25 feet on center. Adequate area for root zone should be incorporated into underground or decked parking garage design. Lighting Exterior lighting within parking areas should be adequately shielded to minimize glare and intrusion on neighboring residential properties. Signage (1)Where permitted, signs should be designed to be read at the pedestrian scale. Use of projecting signs and signs on awnings is strongly recommended. (2)Building mounted signs should relate to the architectural design of .the building, and should be indirectly lit, avoiding large areas of bright colors. Illuminated can signs and illuminated awnings are not permitted. Parking (1) (2) Parking for multi-family projects should be underground where feasible. Partially submerged parking a half level below the building is allowed. Required guest parking may be provided in well-landscaped lots at grade. Any garage openings for natural ventilation associated with partially below grade parking should be located along side or rear property lines rather than 9o30.02.FINAL SOFA CAP P&TC Version.doc 36 October 0!,2002 Chapter V Development Standards 5.010 Summary of Districts (i) (m) (3) (4) (5) (6) (7) along street faces. Openings should be screened with lattice that is compatible with the facade above, and with hedges or other planting. Garage lighting should be designed to minimize glare and intrusion though the plant and lattice screening. Requests to extend fully underground parking under the public right of way may be considered provided that there will be no cost tothe City, no impact on the quality of street trees and on-site tree landscaping to be provided and no impact to existing and/or proposed utilities or similar infrastructure. Surface parking lots should be located behind buildings or in the interior of a site whenever possible. Surface parking lots should be visually and functionally segmented into several smaller lots. Land devoted to surface parking lots should be reduced via redevelopment and construction of shared parking facilities. The configuration of surface parking lots should accommodate future redevelopment. All surface parking lots should be planted so that in 10 years 70% of the surface area of the lot is shaded. Additionally, surface parking lots should be screened from streets by landscape treatments. If it is necessary to provide surface parking in front of a building, such parking should be planted with shade trees at a ratio of 1 tree for every 3 spaces, with the tree located between the parking spaces to maximize shade over the paved parking area and the area where cars are parked. Providing approximately 10% of required spaces as short term parking outside underground garage structure is encouraged and may be identified as short term parking only. This surface level parking should be landscaped with one tree for every 3 spaces. Short term parking should be located along the rear alley when available, serving to widen the alley travel lane to a safer 20 foot width while creating parking with the look and feel of public on- street parking. Parking structures may be used for shared parking arrangements but should not dominate the street frontage. Retail uses should be encouraged on the first floor of street-side edges of parking structures. Bicycle Facilities Pedestrian facilities should be connected with bicycle parking facilities whenever possible to encourage bicyclists to park their bikes and walk to nearby destinations. Art Art should be used to provide visual interest for pedestrians and other passers-by. (n)Mixed Use Design Guidelines Where residential uses are located above non-residential uses, balconies, window designs, building articulation, street level entries, and other similar architectural characteristics should be utilized to emphasize the residential character of the structures and strengthen the pedestrian scale. 9.30.02.F!NAL SOFA CAP P&TC Version.doc 37 October 0! ,2002 Chapter V Development Standards 5.010 Summary of Districts (o) (2)Where non-residential uses are located above residential uses, the ground floor residential uses should be slightly above grade level, including a landscaped setback, porch and stoop design to provide both privacy for the resident and interest for the pedestrian. Trash and Loading Areas Trash and loading areas should be centralized where possible. (p)Pocket parks, plazas and courts (q) (1) (2) (3) Pocket parks, plazas, and courts should be located on major circulation routes, such as corners or near building entrances, to increase usage. Restaurant uses, cafes, or similar service establishments are strongly encouraged to provide outdoor seating areas, benches, or tables. Such spaces should be well-landscaped with trees and other vegetation increasing the tree canopy Noise Reductions All development within the RT-35 and RT-50 districts should employ design and construction methods and materials that reflect or absorb sound such as barriers, landscaping, soundproofing construction materials, and double-glazed windows where necessary to achieve desired noise levels. Chapter V Development Standards 5.010 Summary of Districts Chapter V - Development standards Section List 5.010 5.020 5.030 5.040 5.050 5.060 5.070 5.080 5.090 5.100 5.110 5.120 5.130 Summary of Districts RT-35 and RT-50 District Land Uses RT-35 and RT-50 District Development Standards Restrictions for Specific Uses in the RT-35 and RT-50 Districts Floor Area Bonuses in the RT-35 and RT-50 Districts RT-35 and RT-50 Affordable Housing Requirements Nonconforming Uses and Facilities in the RT-35 and RT-50 Districts Parking Regulations for the RT-35 and RT-50 Districts RT-35 and RT-50 Performance Standards Transfer of Development Rights in the RT-35 and RT-50 Districts Historic Preservation in the SOFA 2 area Regulations for Planned Community Districts in the SOFA 2 Area Environmental Protection 5.010 Summary of Districts The districts described below are the zoning districts within the SOFA 2 area. The various districts are shown on the SOFA 2 districting map, Appendix A. (a)SOFA R-2 District [R-2] The SOFA R-2 Residence district permits one or two dwelling units under the same ownership on a site under regulations that preserve the essential character of single-family use. The number of dwelling units on a site as of [the date of adoption of the CAP] may not be reduced. Some of the existing structures have been identified as potential SOFA 2 Historic Resources. Other district standards are set forth in Appendix G. (b)SOFA RM-15 District [R-15] The SOFA RM-15 District permits low density multiple family dwellings that are compatible with other residential and non-residential uses. The number of dwelling units on a site as of [the date of adoption of the CAP] may not be reduced. All sites in the SOFA RM-15 District have existing structures that have been identified as SOFA 2 Historic Resources. Other district standards are set forth in Appendix G. (c)SOFA RM-30 District [RM-30] The SOFA RM-30 District permits medium density multiple-family dwellings. The maximum permitted density is thirty units per acre. The SOFA RM-30 district site is presently developed as an integrated project with the adjoining PC District 3707. The number of dwelling units on the site as of [the date of adoption of the CAP] may not be reduced. The site is required to provide 6 parking spaces for the residential units in PC District 3707. Other standards are set forth in Appendix G. Chapter V Development Standards 5.010 Summary of Districts (d)Planned Community District 2967 [PC=2967] PC-2967 was created in 1977 to permit the construction of 19 market-rate dwelling units on the site at the.corner of Forest Avenue and Ramona Street. It has not been identified as a historic resource. The number of dwelling units may not be reduced. Other district standards are set forth in Appendix G. (e)Planned Community District 3707 [PC-3707] (f) PC-3707.was created in 1986 for 744 Ramona Street to provide 3 residential units and 12 commercial parking spaces for professional offices at 745 Emerson Street. The site. is developed as a unified project with the adjacent RM-30 site, which provides 6 parking spaces for the residential units. The number of dwelling units may not be reduced. Other District standards are set forth in Appendix G. Planned Community District 4283 [PC-4283] PC-4283, Alma Place, was approved in 1995 at 725-753 Alma Street to provide 107 affordable residential units and a limited amount of office space. The number of dwelling units may not be reduced. Other district standards are set forth in Appendix G. (g)Planned Community District 4389 [PC-4389] PC-4389 was created in 1996 at 901 Alma Street as a mixed-use project providing 4 dwelling units and approximately 4,425 square feet of office space. Public art and street and alley improvements were provided as a pt~blic benefit. The number of dwelling units may not be reduced. Other district standards are set forth in Appendix G. (h)RT Residential Transition Districts [RT] The Residential Transition District is the primary district for the SOFA 2 area. It is divided into the RT-35, and RT-50 districts, each of which has different development standards. The RT-35 and RT-50 districts are intended to promote the continuation of a mixed use, walkable, area with a wealth of older buildings. In the future, as in the past, different non-residential uses will become more or less dominant. However, it is a goal of the plan to make sure that a particularly strong market in one sector does not drive out diversity. Neighborhood serving retail and service uses that serve the residential communities in and near SOFA are particularly valued. The differing height, intensity, and use restrictions recognize the differing potentials of the area as it moves between purely residential neighborhoods and the downtown, and closer to Alma Street and the transit center. 9 30.02 F.NAL SOFA CAP P&TC Version.doc 40 October 01,2002 Chapter V Development Standards 5.020 RT-35 and RT-50 Land Uses 5.020 RT-35 and RT=50 Land Uses Table 1 shows the uses permitted or conditionally permitted in the RT-35 and RT-50 districts. Size restrictions for the uses in Table 1 are set forth in section 5.040. Table 1: RT District Permitted and Conditionally Permitted Uses Private educational facilities use P Private clubs, lodges, or fraternal organizations P Religious institutions P &040(a),(b),(c), (d) p 5.040(a),(b),(c), Medical and professional offices (d) 5.040(a),(b),(c), General business offices CUPUtility facilities 5.040(a),(b),(c), (d) Home occupations P Lodging (including bed and breakfast facilities)P Multiple-family uses, including SRO housing P Residential care homes I~ See minimum Two-family uses p density requirements in 5.030(a) P 9~30.02.F!NAL SOFA CAP PR, T("t Version.doc 41 n~tnh~r nl ~nn~ Chapter V Development Standards 5.020 RT-35 and RT-50 Land Uses Automobile service stations, subject to site and design review as specified in Chapter 18.82 of the. Palo Alto Municipal Code Automotive services, including tire services Convalescent facilities Day care centers Day care homes, small adult Day care homes, large adult Day care homes, small family Day care homes, large family Eating and drinking facilities, except drive-in services Financial services General business services Personal services Reverse vending machines Temporary uses, subject to regulations in Chapter 18.90 of the Palo Alto Municipal Code CUP(1) P P P P P P P P P CUP CUP 5.040(a),(b),(c), (d) 5.040(a),(b),(c), (d) Parking as a principal use CUP Transportation terminals CUP{~} (1) Such uses are only permitted in that area bounded by High Street on the east, Alma street on the west, Forest Avenue on the north, and Addison Avenue on the south. 9.30.02.F!NAL SOFA CAP P&TC Vers.on.doc 42 October 0! ,2002 Chapter V Development Standards 5.030 RT-35 and RT-50 Development Standards RT-35 and RT-50 Development Standards (a)Site Development Standards Table 2 shows the site development standards applicable in the RT-35 and RT-50 districts. Where there is no entry in a cell,there is no minimum requirement. Table 2: RT District Site Development Standards Minimum Site Specifications Minimum Setbacks for Exclusively Residential Uses Front Yard (ft) Interior Side Yard (ft) Street Side Yard (ft) Rear Yard (ft) Rear Yard along alle~ (ft) Minimum Setbacks for Non-Residential and Mixed Uses Floor area ratio (FAR) Maximum Height (ft) Daylight Plane for site lines along High Street Height above average grade at appiicable site line (ft) Angle above horizontal (degrees) Daylight Plane for site lines along Homer Avenue Height above average grade at applicable site line (ft) Angle above horizontal (degrees) Residential Density Maximum density (standard) (du/acre) Maximum density (senior housing, BMR studio apartments) (du/acre) Minimum density (du/acre) Maximum unit size (square feet) (1) As measured to the midpoint of the roof None _(2) 15 15 5 5 None see Section 5.040, Size Restrictions for Specific Uses in the RT-35 and RT-50 Districts 35{1) 5011~ None 35 None 45 35 6O ,40 50 20t~) 1,500 None None 3O 4O 15{~ 1,500 (2) The setback shall be equal to the average setback for the block. The average setback is the average distance between the front property line and the first main building wall on sites on the same side of the block. For blocks longer than 600 feet, the average setback shall be based on the ten sites located on the same side of the street and nearest to the subject property. (3) SOFA 2 Historic Resources are not subject to minimum density requirements. Chapter V Development Standards 5.030 RT-35 and RT-50 Development Standards (b)Non-residential Use above Residential Use Where non-residential uses are located above residential uses, commercial development shall not overhang the outer wall of any residential unit by more. than 8 feet. (c)Permitted Encroachments (1) 3 foot projections into the front setback are allowed for porches, arbors, trellises and other entry features. (2)A 5-foot encroachment into the rear setback is permitted for residential use for underground or podium parking. (3)Dormers, roof. decks, gables, or similar architectural features may extend beyond the daylight planes established by this section 5.030, if the horizontal length of all such features combined does not exceed 15 feet on any side. No single feature may exceed 7.5 feet in length, and there shall be a minimum 5-foot separation between each feature.The height of such features may not exceed 24 feet above grade. (d)Landscaping and Street Frontages (1) (2) (3) Street trees are required along all streets. Street trees shall be spaced no further than 20 to 25 feet on center in I~lanter Strips or tree wells located between the curb and sidewalk. Tree species and planting techniques shall be selected to create a unified image for the street, provide effective canopy, avoid sidewalk damage, and minimize water consumption (see Appendix D for tree selection along specific streets). The regulations of Palo Alto Municipal Code Section 18.47.040 (Pedestrian Shopping Combining District (P) Regulations) shall apply in the RT-35 and RT-50 districts. Where commercial offices are located on the ground floor, public reception areas of display windows must be clearly visible from street level. Frosted glass or translucent or solid window blinds are not permitted. (e)Public and Private Open Space for Residences. All new residential or mixed-use projects shall provide usable private open space for each unit, or significant usable shared open space, or both. The adequacy of the open space for the residents of the building shall be reviewed as part of architectural review. Signs (1) All signs must comply with Chapter 16.20 of the Palo Alto Municipal Code. (2)Illuminated can signs and illuminated awnings are prohibited in the RT-35 and RT-50 districts. 9.30.02.F!NAL SOFA CAP P&TC Version.doc 44 October 0!,2002 Chapter V Development Standards 5.030 RT-35 and RT-50 Development Standards (g)Floor Area Exemption for Americans with Disabilities Act Compliance (h) Square-footage added to existing buildings to bring the building into compliance with the Americans with Disabilities Act (ADA) shall be exempt from floor area calculations. No ADA exemption shall be available for new buildings. Noise Attenuation for Residential Development along Alma Street or near Substation Applicants for approval of residential development of parcels having any site line along Alma Street must demonstrate that private residential open space and interior space meet applicable city noise standards and shall provide such studies as the city reasonably requires. Residential development and open space should generally be located on the top and to the rear of such projects to help buffer residents from traffic, train and substation noise. 9.30.02.F!NAL SOFA CAP P&TC Version.doc 45 October 0! ~nn~ Chapter V Development Standards 5.040 Restrictions for Specific Uses 5.040 Restrictions for Specific Uses in the RT-35 and RT-50 Districts (a)Use Categories The permitted and conditionally permitted uses in the RT-35 and RT-50 districts are categorized as shown in Table 3: ories ¯ Two-family use Multiple-family use Residential care homes Home oc6upations Senior housing Single-room occupancy housing Day care centers and day care homes Public parking Religious institutions Lodging Retail services, excluding liquor stores Automobile service stations Automotive services Convalescent facilities Eating and drinking services Personal services Private clubs, lodges, or fraternal organizations Transportation terminals Temporary parking facilities Commercial Recreation Financial services General business services Medical, professional, and general business offices Educational facilities Utility facilities (b)Maximum Permitted FAR The maximum allowable FAR shall be as follows: (1) (2) (3) (4) For all uses on a site, 1.15:1 in the RT-35 district, and 1.50:1 in the RT-50 district, except that the FAR may be increased to 1.50:1 in the RT-35 district and 2.0:1 in the RT-50 district with a planned community district under Section 5.120, with floor area bonuses under Section 5.050, or transferable development rights under section 5.100. For all Category 1 uses on a site, 1.15:1 in the RT-35 district, and 1.50:1 in the RT-50 district, except that the FAR for such uses may be increased to 1.50:1 in the RT-35 district and 2.0:1 in the RT-50 district with a planned community district, under Section 5.120, with floor area bonuses under Section 5.050, or transferable development rights under Section 5.100. For uses in Category 2 on a site, 0.4:1. For all Category 3 uses on a site, 0.25:1 or 2,500 square feet, whichever is smaller. (5) For all Category 2 and 3 uses on a site combined, 0.4:1. Chapter V Development Standards 5.040 Restrictions for Specific Uses (c)Ground Floor Restrictions Ground floor area that is adjacent to a street (other than an alley) may only be used for Category 1 or 2 uses, or for entryways leading to other uses. The street- facing ground floor area must be of sufficient size to permit occupancy by viable Use Category 1 or 2 uses, as determined by the Director of Planning and Community Environment. Ground floor area not occupied by Category 1 or 2 uses shall be designed to be convertible to such uses. Entryways shall not be so large as to unnecessarily eliminate space otherwise usable for Category 1 or 2 uses. (d)Protection of Specific Ground Floor Uses from Conversion to Office Medical, professional, and general business offices shall not be located on the ground floor, except for such uses which: (1) have been continuously in existence in that space since March 19, 2001, and, as of such date, were neither non-conforming nor in the process of being amortized pursuant to Chapter 18.95 of the Palo Alto Municipal Code; (2)occu’py a space that was not occupied by housing, retail services, personal services, eating and drinking services, or automotive services on March 19, 2001; (3) (4) occupy a space that was vacant on March 19, 2001; or are located in new or remodeled ground floor area if the ground floor area devoted to housing, retail services, eating and drinking services, personal services, and automobile services does not decrease. Chapter V Development Standards 5.050 Floor Area Bonuses 5.050 Floor Area Bonuses in the RT=35 and RT=50 Districts (a)SOFA 2 Historic Resource Bonuses. A SOFA 2 Historic Resource that is undergoing historic rehabilitation consistent with the Secretary of the Interior’s Standards is entitled to bonus floor area. This bonus square footage, whether developed on site or transferred to an eligible receiver site, is exempt from parking requirements. A historic rehabilitation bonus, whether granted under the SOFA 2 CAP or previous zoning, is only available one time per site. Historic preservation bonuses are available as follows: Table 4: RT District Historic Rehabilitation Bonuses RT-35 Existing FAR no more than 1.5 to 1 Existing FAR more than 1.5 to 1 RT-50 Existing FAR no more than 2.0 to 1 Existing FAR more than 2.0to 1 Greater of 2,500 square feet or 25% of existing building square footage Greater of 2,500 square feet or 25% of maximum allowed floor area on the site Greater of 2,500 square feet or 25% of existing building square footage Greater of 2,500 square feet or 25% of maximum allowed floor area on the site (2)A historic rehabilitation bonus may be used on site only as part of a project that is consistent with the Secretary of the Interior’s Standards, the SOFA 2 compatibility requirements, and other development standards, excluding the floor area ratio. A historic rehabilitation bonus, whether granted under the SOFA 2 CAP or previous zoning, is only available one time per site. (3)All or some of a historic resource bonus may be transferred to (1) other sites in the RT-35 or RT-50 district that are not SOFA 2 Historic Resources or (2) eligible receiver sites outside SOFA 2. Transferred bonuses may not be used to increase FAR above 1.5 to 1 in the RT-35 District or 2.0 to 1 in the RT-50 District. (4)Prior to issuance of the building permit for a historic rehabilitation bonus on site, the issuance and recordation of the-certificate described in Section 5.050(f) below, or transfer of the bonus to another site, the owner of the historic site shall record a covenant, in a form satisfactory to the City Attorney, agreeing to maintain the site in substantial conformance to the Secretary of the Interior’s Standards. (b)Seismic Hazard Remediation Bonuses. O)A building that is identified as a Seismic Hazard in Appendix B-3 and is undergoing seismic rehabilitation is entitled to a floor area ratio bonus of up to the greater of 2,500 square feet or 25% of the floor area of the existing Chapter V Development Standards 5.050 Floor Area Bonuses (c) (2) building. The size of the bonus is limited by the unused FAR on site, using an FAR maximum of 1.5 to 1 in the RT-35 District and 2.0 to 1 in the RT-50 District. This bonus is only available when existing buildings are rehabilitated; it is not available when the identified seismic hazard is demolished and replaced. This bonus square footage, whether developed on site or transferred to an eligible receiver site, is exempt from parking requirements, A seismic rehabilitation bonus, whether granted under the SOFA 2 CAP or previous zoning, is only available one time per site. All or some of a seismic rehabilitation bonus may be transferred to (1) other sites in the RT-35 or RT-50 district that are not SOFA 2 Historic Resources or (2) eligible receiver sites outside of SOFA 2. Transferred bonuses may not be used to increase FAR above 1.5 to 1 in the RT-35 District or 2.0 to 1 in the RT-50 District. (3)Seismic rehabilitation shall conform to the analysis standards referenced in Chapter 16.42 of the Palo Alto Municipal Code. Bonus for all other sites in the RT-35 and RT-50 Districts. ~#_.n__c._.o._~!_ra,g~._l~_r.#~,.e_.~#~!£n- #_~.~ reuse of buildings in existence on #ti~n o[-~ii~ ~, such buildings shall be allowed an increase in floor area of 200 square feet without having this increase count toward the FAR, provided that the total development on site, including the 200 square foot bonus, does not exceed 1.5 to 1.0 in the RT-35 District and 2.0 to 1:0 in the RT-50 District. The bonus area shall be excluded in calculating parking requirements. This bonus, whether granted under the SOFA2 CAP or previous zoning, is only available one time per site. (d)Restrictions on Floor Area Bonuses. The floor area bonuses in subsections (a), (b) and (c) are subject to the following restrictions: (1) (2) (3) (4) All non-residential bonus square footage shall be counted as square footage for the purposes of the 350,000 square foot limit on development in the Downtown monitoring area, as specified in the Comprehensive Plan. Historic rehabilitation and seismic hazard reduction bonuses within the SOFA 2 area must be used for residential development. Bonuses transferred from the SOFA 2 area to an eligible receiver site outside of the SOFA 2 area are not subject to this restriction. Not withstanding subsections (a) and (b) above, no more than 5,000 transferred bonus square feet per site shall be exempt from parking req uirements. For sites eligible for both historic rehabilitation and seismic hazard reduction bonus, the bonuses may be used on site subject to the following requirements: (A)The city council must approve on-site use of the bonuses. Such approval is discretionary, and may be granted only upon making both of the following findings: 9.30.02.F!NAL SOFA CAP P&TC Version.doc 49 October 0! ,2002 Chapter V Development Standards 5.050 Floor Area Bonuses (e) (f) (B) (i)The rehabilitation will comply with the Secretary of the Interior’s Standards. (ii)The on-site use of the FAR bonus would not otherwise be inconsistent with the historic character of the interior and exterior of the building and site. The applicant for on-site use of a combined floor area bonus shall have the burden of demonstrating the facts necessary to support the findings required for council approval. Transfer of FAR Bonuses. The floor area bonuses described in subsections (a) and (b) may be transferred to eligible receiver sites as described in Section 5.100. These transfers are not subject to the discretionary council review in subsection (d) (4) above. Procedure for Granting of FAR Bonuses. The historic rehabilitation and seismic hazard reduction floor area bonuses shall be granted in accordance with the following requirements: (1)An application must be filed with the director stating the square footage claimed, the basis for the claim, the area to be used on site, and the area proposed for transfer, together with such other information as the director may require. (2)The director shall review the completed application and such additional material as the director deems relevant and make a written determination on eligibility for a bonus. The director shall find eligibility for a bonus based upon the following: (A)In the case of a floor area bonus for seismic hazard reduction, the chief building official has made a determination that the project complies with or exceeds the analysis standards referenced in Chapter 16.42 of the PAMC. (3) (B)In the case of a historic rehabilitation floor area bonus, the director, after consultation with the joint ARB/HRB SOFA 2 review board and review of evidence provided by a qualified expert, finds that the project complies with the Secretary of the Interior’s Standards. The city may retain an expert in historic rehabilitation or preservation, at the applicant’s expense.in the case of a project that includes non- residential development, to provide the city with an independent evaluation of the project’s conformity with the Secretary’s Standards. (C)In the case of combined Historic Resource and seismic rehabilitation bonus, the City Council has made the findings in subsection (d) above° A certificate stating the total floor area bonus used on the site and amount (if any) of remaining floor are bonus which is eligible for transfer to another site shall be issued and recorded in the Office of the County Recorder and a copy shall be provided to the property owner. Chapter V Development Standards 5.060 Affordable Housing Requirements 5.060 RT=35 and RT=50 Affordable Housing Requirements (a)For-sale Housing Projects Development of all for-sale housing projects with three or more units shall comply with the following requirements: (2) At least 10%, or such higher percentage as specified in the Comprehensive Plan at the time of project approval, of the units to be developed shall be for- sale BMR units. Such BMR units shall be comparable to other units in the development. If the sales price of such BMR units is not sufficient to cover the developer’s estimated direct construction and financing cost of the unit, exclusive of land, marketing, off-site improvements, and profit, the BMR requirements may be fulfilled in either of the following ways: (A) The required BMR units may be provided off-site. Off-site units maY be new or rehabilitated existing units and must be pre-approved by the Director of Planning and Community Environment; or (B)Vacant land suitable for affordable housing may be provided to the City. (3)If fulfillment of the BMR requirements is not feasible by any of the aforementioned methods, as determined by the Director of Planning and Community Environment, an in-lieu cash payment equal to 5%, or such higher percentage as specified in the Comprehensive Plan at the time of project approval, of the greater of the actual sales price or fair market value of each unit sold shall be paid to the City’s Housing Development Fund at the time of the first sale or transfer of any unit in the for-sale housing project. (4)For fractional units required under this section, a payment to the City’s .Housing Development Fund may be made at the time of the first sale or transfer of any unit in the for-sale housing project in lieu of providing a full BMR unit. The amount of the payment shall be as follows: (A)For developments over 10 units, the payment shall be equal to 5%, or such higher percentage as specified in the Comprehensive Plan at the time of project approval, of the greater of the actual sales price or fair market value of each unit for which the fractional unit is required. (B)For developments of fewer than 10 units, the payment shall be 3.25% for 3 units, increasing by .25% for each additional unit, or such higher percentage as specified in the Comprehensive Plan at the time of project approval. (b)Rental Projects Development of all rental projects of 5 or more units shall comply with the following requirements: 9.30,02,FINAL SOFA CAP P&TC Version.doc 51 October 0!, ~nn? Chapter V Development Standards 5.060 Affordable Housing Requirements (1)At least 10% of the units in a rental project, or such higher percentage specified in the Comprehensive Plan at the time of project approval, shall be provided as BMR units. Such BMR units shall be comparable to other units in the development. (2)At the discretion of the Director of Planning and Community Environment, an annual fee may be paid in-lieu of providing BMR rental units. The fee shall be equal to the difference between the initial Section 8 Fair Market Rent and the market rate rents of the units, or a one-time fee based on 5%, or such higher percentage as specified in the Comprehensive Plan at the time of project approval, of the appraised value of the rental portion of the project. (3)For fractional units required under this section, a payment to the City’s Housing Development Fund may be made prior to occupancy of the housing project in lieu of providing a full BMR unit. The amount of the payment shall be as follows: (A) (B) For developments over 10 units, the payment shall be equal to the difference between the initial Section 8 Fair Market Rent and the market rate rents of the units for which the fractional unit is required, or a one-time fee based on 5%, or such higher percentage as specified in the Comprehensive Plan at the time of project approval, of the appraised value of that rental portion of the project for which the fractional unit is required. For developments of fewer than 10 units, the payment shall be 3.75% for 5 units, increasing by .25% for each additional unit. (c)Subdivisions Vacant land that is subdivided into three or more lots and sold without construction of housing must provide buildable parcel(s) equivalent to 10% of the development, or such higher percentage as specified in the Comprehensive Plan at the time of project approval, to the City or the City’s designee. An in-lieu fee may be agreed to by the City and the developer based on 5%, or such higher percentage as specified in the Comprehensive Plan at the time of project approval, of the greater of the actual sales price or fair market value of the improved lots with houses. -9.30.02oFINAL SOFA CAP P&TC Version.doc 52 October 0! ,2002 Chapter V Development Standards 5.07O Non-conforming Uses 5.070 Non=conforming Uses and Facilities in the RT=35 and RT=50 Districts (a)Legal Non-conforming Uses Any use existing on ~~!i~"~~,,~i~, that prior to that date was a lawful conforming permitted use or conditional use operating subject to a conditional use permit, or was a lawful non-conforming use under previous applicable zoning regulations, may remain as a legal non-conforming use and shall not require a conditional use permit. (b)Legal Non-complying Facilities Any facility existing on i!-~.iii~f.i~that prior to that date was a complying facility or legal non-complying facility, may remain as a legal non- complying facility. (c)Change of non-conforming use A change of use may only be to a use permitted under the CAP, with the following exceptions: (1)Category 3 uses that are non-conforming because they are located on a ground floor o~ exceed the permitted size for a site may be converted in whole or in part to a Category 1 or 2 use, and then be returned to the previous Category 3 use. The purpose of this exception is to encourage the conversion of non-conforming Category 3 uses to Category 2 or 1 uses, even on a temporary basis. (2)When a site contains more floor area than is permitted as of right for any use or combination of uses, the excess floor area may be used for Category 1 uses. This section does not authorize the conversion of space used or designed for low-intensity uses such as parking or storage to habitable space. (d)Expansion of non-conforming use (e) Non-conforming uses may not be expanded or intensified. A use is intensified when it is altered in a way that increases the required parking or increases the degree of non-conformity with the CAP. Discontinuance of non-conforming use A non-conforming us’e that is discontinued or abandoned or otherwise ceases operation and use of the site for a period of one year or more shall not be resumed, and the facility or portion of the facility occupied by the non-conforming use shall only be occupied by a conforming use. In the case where no conforming ¯ use or mix of conforming uses will permit the use of the entire floor area of the facility, the excess floor area may be used only for Category 1 uses. Provided, floor area that was last used for Use Category 2 or 3 uses may be re-occupied by Use Category 2 uses. 9.30.02.FINAL SnF~ C~ P&TC \/ .....first~~:~(’~n*r~l~r n~ o0n2 ,: Chapter V Development Standards 5.O60 Affordable Housing Requirements (f)Replacement of non-conforming use A facility that is occupied in whole or in part by non-conforming uses, and which is damaged or destroyed by any means except ordinary wear and tear and depreciation, may be reconstructed or replaced. Those legal non-conforming uses that occupied the facility prior to its damage or destruction may occupy the reconstructed o,r replaced facility, with the following provisions: (1) (2) (3) There shall be no increase in the extent of nonconformity, the intensity of activity, or the floor area of the non-conforming use. Reconstruction or replacement shall be subject to all applicable laws, regulations, and procedures otherwise governing construction on the site. For replacement of non-complying facilities, the replacement shall conform with the requirements of subsection (j). (g)Use of a vacant non-complying facility A non-complying facility that was vacant on [tl~e-~ff~i-~!~da~i:~i:i~i shall only be used for a conforming use, or a mix of conforming uses. In the case where no conforming use or mix of conforming uses will permit the use of the entire FAR of the facility, the excess FAR may be occupied by Use Category 1 uses. Provided, where the last use of the vacant non-complying facility was for Use Category 2 or Use Category 3 uses, the excess FAR may be used for Use Category 2 uses or Use Category 1 uses. (h)Change of non-complying facility (i) Non-conforming facilities may be remodeled, improved or replaced; provided that such remodeling, improvement or replacement shall not increase floor area, shift the building footprint, or increase the height, length, depth, width, or building envelope, or in any other way increase the existing degree of noncompliance, except pursuant to the floor area bonuses for seismic and historic rehabilitation described in 5.050. Maintenance and Repair of non-complying facility (2) Normal and routine maintenance of a non-complying facility shall be permitted for the purpose of preserving its existing condition, retarding or eliminating wear and tear or physical depreciation, or complying with the requirements of law. Incidental alterations to a non-complying facility shall be permitted, provided such alterations do not increase the degree of noncompliance, or otherwise increase the discrepancy between existing conditions and the requirements of this title. (3)Structural alterations to a non-complying facility shall be permitted when necessary to comply with the requirements of law, or to accommddate a conforming use when such alterations do not increase the degree of noncompliance, or otherwise increase the discrepancy between existing conditions and requirements of this title. Chapter V Development Standards 5.060 Affordable Housing Requirements (J)Replacement of non-complying facility A non-complying facility that is damaged or destroyed by any means except ordinary wear and tear and depreciation may be reconstructed only as a complying facility, except as follows: (1) (2) When the damage or destruction of a non-complying facility affects only a portion of the facility that did not constitute or contribute to the non- compliance, said portion may be repaired or reconstructed to its previous configuration. When the damage or destruction of a non-complying facility affects a portion of the facility that constituted or contributed to the noncompliance, any replacement or reconstruction to such damaged portion shall be accomplished in such manner as not to reinstate the noncompliance or degree of noncompliance caused by the destroyed or damaged portion of the facility, and otherwise in full compliance with this title; however, if the cost to replace or reconstruct the non-complying portion of the facility to its previous configuration does not exceed fifty percent of the total cost to replace or reconstruct the facility in conformance with this subsection, then the damaged non-complying portion may. be replaced or reconstructed to its previous configuration. In no event shall such replacement or construction create, cause, or increase any noncompliance with the requirements of this title. (3)Except as otherwise provided in this section with regard to replacement or reconstruction of a portion of a facility to its previous non-complying condition, all reconstruction shall be subject to all applicable laws, regulations, and procedures otherwise governing construction on the site at the time said construction is undertaken. 9.30.02.FINAL SOFA CAP P&TC Version.doc 55 October 01,2002 Chapter V Development Standards 5.080 Parking 5.080 Parking Regulations for the RT=35 and RT=50 Districts (a)Applicable PAMC Regulations Chapter 18.83 of the Palo Alto Municipal Code shall apply as amended from time to time. Where requirements in this CAP conflict with requirements from Chapter 18.83, this CAP shall prevail. (b)Parking Requirements The following table shows the required,parking for uses in the RT-35 and RT-50 districts. Table 5: RT District Required Parki_~ Multiple-family and two-family use Multiple-family use, if car share is available and a transit pass is provided. Senior housing and single room occupancy housing Medical, professional, and general business offices, general business services, financial services, personal services, automotive services, and automobile service stations Retail services and eating and drinking facilities All other uses permitted or conditionally permitted in the RT-35 or RT-50 districts As required by PAMC Chapter 18.83 1.5 per unit 1 per unit 1 per 350 square feet of gross floor area 1 per 250 square feet of gross floor area above the first 1,000 square feet As required by PAMC Chapter 18.83 (c)Parking Reduction for a Transportation Demand Management Program (d) (e) For medical, professional, and general business offices, general business services, financial services, personal services, automotive services, and automobile service stations, parking requirements may be reduced by 5% with the implementation of a Transportation Demand Management Program. Tandem Parking Tandem parking is only permitted for multiple-family and two-family uses. Parking Reduction for Historic Resources Reductions of up to 25% of the parking requirement may be approved by the Director of Planning and Community Environment for SOFA 2 Historic Resources Chapter V 5.080 Development Standards Parking that undergo rehabilitation in conformance with the Secretary of the Interior Standards, subject to the following provisions: (1)The parking reduction shall be a reduction of the total parking required for the non-exempt square footage of the historic structure; (2) (3) Existing parking shall not be eliminated as a result of the reduction; The Director of planning and community environment shall grant the exception only upon completion of a parking study, done by a qualified consultant hired by the city and paid for by the applicant, verifying that the reduced parking requirement will provide sufficient parking for the use or uses in the historic building. (4)Once a parking reduction is granted, there may beno change of use on site without a new determination under section (h)(3) above. Sites within Parking Assessment Districts Sites within a parking assessment district retain all rights and responsibilities resulting from their location within that parking assessment district. 9.30.02.FINAL SOFA CAP P&TC Version.doc 57 Chapter V Development Standards 5.090 Performance Standards 5.090 RT=35 and RT=50 Performance Standards (a) (b) Noises, Odors, and Clutter Noises, odors, and clutter shall be screened effectively from streets and adjacent properties. Trash and Service Equipment Trash and service equipment, including but not limited to satellite receiving dishes, dumpsters, recycling containers, and air conditioning units, shall be located on the rear of buildings or otherwise out of public view and shall be enclosed or screened with 100% opaque materials around all sides, including landscaping where permissible. (c)Trash Recycling Areas Trash recycling areas and similar offensive areas shall be entirely enclosed (top and sides) and screened with 100% opaque materials when located adjacent to or in close proximity to existing residential uses, proposed residential uses, and residentially zoned properties. (d)Reduction of Noise and Visual Impacts New commercial and mixed-use projects, including such noise generating uses as vehicle, automobile repair, aLitomobile service station, and transportation centers, shall be designed to reduce potential noise and visual impacts on adjacent uses with particular attention to existing residential uses. (e)Reduction of External Noise Impacts All new development or substantial remodeling of existing uses, which might be impacted by such uses shall incorporate design features to minimize potential impacts from noise producing uses on future building tenants and users. (f)Storage Yards All commercial uses with outside service or storage yards, including vehicle storage yards, shall provide attractive, opaque screening around the entire perimeter of these yards. Screening shall include dense landscaping in combination with an opaque fence if feasible. (g)Elimination of Odors and Fumes All uses producing Strong odors and fumes, which can be detected from off or adjacent to the property shall install equipment or containment areas in order to eliminate such detectable odors and fumes. 9.30.02.FINAL SOFA CAP P&TC Version.doc 58 October 0!, 2002 Chapter V Development Standards 5.100 Transfer of Development Rights 5.100 Transfer of Development Rights in the RT-35 and RT-50 Districts (a) (b) (c) (d) Purpose This section describes the exclusive procedure for transfer of development rights to or from properties in the RT-35 and RT-50 districts, including any Planned Community districts established in an RT district Establishment of Forms The city may from time to time establish application forms, submittal requirements, fees and such other requirements and guidelines as will aid in the efficient implementation of this section. Eligibility for Transfer of Development Rights Transferable development rights may be transferred to an eligible receiver site upon: (t) certification by the city pursuant to 5.050(f) of the floor area from the sender site which is eligible for transfer, and ¯ (2) compliance with the transfer procedures set forth in subsection (h). Availability of Receiver Sites The city does not guarantee that at all times in the future there will be sufficient eligible receiver sites to receive such transferable development rights. (e)Eligible Receiver Sites (f) A site is eligible to be a receiver site only if is an eligible receiver site for transfers of development rights under the applicable zoning. For eligibility criteria in the RT-35 and RT-50 districts, see subsections 5.050(a) and 5.050(b) above. These standards apply to all sites in these districts, including those located in the downtown parking assessment district. Limitations On Usage of Transferable Development Rights No otherwise eligible receiver site shall be allowed to use transferable development rights under this chapter to the extent such transfer would: (1) cause the FAR on the site to exceed that allowed by the applicable zoning for the transfer sites. (2)cause the development limitation for the Downtown monitoring area set forth in Comprehensive Plan to be exceeded. 9.30.02.FhNAL SOFA CAP P&TC Version.doc 59 October 0!, 2002 Chapter V Development Standards 5.100 Transfer of Development Rights (g)Parking Requirement Exemption The first 5,000 square feet of floor area transferred to a receiver site in the RT-35 district, the RT-50 district, or any PC District in the SOFA 2 area shall be exempt from the otherwise-applicable on-site parking requirements. (h)Transfer Procedure (i) Transferable development rights may be transferred from a sender site (or sites) to a receiver site only in accordance with all of the following requirements: (1)An application pursuant to Chapter 16.48 of the Palo Alto Municipal Code for major ARB review of the project proposed for the receiver site must be filed. The application shall include: (A)A statement that the applicant intends to use transferable development rights for the project; (B) Identification of the sender site(s) and the amount of TDRs proposed to be transferred; and (C)Evidence that the applicant owns the transferable development rights or a signed statement from any other owner(s) of the TDRs that the specified amount of floor area is available for the proposed project and will be assigned for its use. (2)In reviewing a project proposed for a receiver site pursuant to this section, the architectural review board, or the joint ARB/HRB board, if the receiver site is subject to joint board review, shall review the project in accordance with Section 16.48.120 of the Palo Alto Municipal Code and the SOFA CAP, Phase 2; however, the project may not be required to be modified for the so!e purpose of reducing square footage unless necessary in order to satisfy the criteria for approval under Chapter 16.48, the SOFA 2 CAP, or any specific requirement of the municipal code. (3)Following design approval of the project on the receiver site, and before issuance of building permits, the director shall issue written confirmation of the transfer, which identifies both the sender and receiver sites and the square footage transferred. This confirmation shall be recorded in the office of the county recorder prior to the issuance of building permits and shall include the written consent or assignment by the owner(s) of the TDRs where such owner(s) are other than the applicant. Purchase or Conveyance of TDRs - Documentation (1)Transferable development rights may be sold or otherwise conveyed by their owner(s) to another party. However, no such sale or conveyance shall be effective unless evidenced by a recorded document, signed by the transferor and transferee and in a form designed to run with the land and satisfactory to the city attorney. The document shall clearly identify the sender site and the amount of floor area transferred and shall also be filed with the department of planning and community environment. 9.30.02.F!NAL SOFA CAP P&TC Version,doc 60 October 01,2002 Chapter V Development Standards 5.100 Transfer of Development Rights (2)Where transfer of TDRs is made directly to a receiver site, the recorded confirmation of transfer described in subsection (h)(3) shall satisfy the requirements of this section. 9.30.02.FINAL SOFA CAP P&TC Version.doc 6!October 0 ! ,2002 Chapter V Development Standards 5.110 Historic Preservation 5.110 Historic Preservation in the SOFA 2 area SOFA 2 Historic Resources shall be maintained and preserved. Restoration, additions and alterations shall be in substantial conformance with the Secretary of the Interior’s Standards. Adaptive reuse is permitted and encouraged. 5.120 Regulations for SOFA 2 PC Districts Planned Community (PC) Districts may be established in the SOFA 2 area pursuant to the procedures in Section XXXX of this CAP. (a)Location New PC districts in SOFA 2 must be located in the RT-35 or RT-50 district. Existing PC districts in SOFA 2 may be amended. (b)Land (2) (3) Uses A PC district must be predominantly or exclusively residential. A PC district may not be used to increase the floor area of Category 2 or Category 3 use otherwise permitted on a site. The specific uses permitted in a PC shall be defined in the ordinance establishing it. (c)Development Standards (1)The maximum floor area ratio (FAR) shall be as follows: (A) For sites that were located in the RT-35 district on iii the maximum FAR for the SOFA 2 PC District shall be 1.5:1 (g) For sites that were located in the RT-50 district on the maximum FAR for the SOFA 2 PC District shall be 2.0:1 (2)The height limit shall not be increased by establishment of a PC District. (3)The daylight plane shall not be altered by establishment of a PC District. (4)Residential units shall be no larger than 1,500 square feet. (5)All new development, including approved modifications that add thirty percent or more floor area to existing uses, shall provide adequate and accessible interior areas or exterior enclosures for the storage of recyclable materials in appropriate containers. The design, construction and accessibility of recycling areas and enclosures shall be subject to approval by the architectural review board, in accordance with design guidelines adopted by that board and approved by the city council pursuant to Palo Alto Municipal Code Section 16.48.070. Chapter V Development Standards 5.120 Planned Community Districts (d)Inspections Each PC district shall be inspected by the building division at least once every three years for compliance with the PC district regulations and the conditions of the ordinance under which the district was created. (e)Public Benefits Each new planned community district shall provide some public benefits. For property in the RT-35 district, a minimum of one public benefit from the following list shall be provided, and for property in the RT-50 district, a minimum of two public benefits from the following list shall be provided. (1)Provision of an additional 5% of all developed for-sale or rental units at below market rate units, over the requirement established by Section 5.060. (2)Provision of substantial public parking; (3)Provision of a child-care facility that is open to the public; (4)Provision of a well-designed public gathering space; (5)Provision of space at a below market rate for community and non-profit services; or (6) A comparable public benefit consistent with the purposes of this CAP. 9.30.02.F!NAL SOFA CAP P&TC Version.doc 63 Chapter V Development Standards 5.130 Environmental Protection 5.130 Environmental Protection (a) (b) (c) Noise (2) Design of all residential development within the RT-35 and RT-50 districts located in an area where the Leo exceeds 60 dBA shall be subject to modeling of interior noise levels by acoustical engineers prior to construction to ensure compliance with City of Palo Alto standard of 45 dB Ldn for residential development set forth in PAMC Title 9 All residential development proposed in a noise environment of 65 dBA Ldn shall be designed so that all required exterior open space shall have a noise environment not exceeding 65 Lan Geology Project applicants shall, if determined necessary by the building official, contract with a qualified soils or geotechnical engineer to perform a detailed geotechnical study for any development proposed within the SOFA 2 area. All mitigation measures identified in the geotechnical report shall be implemented in order to reduce geologic-related impacts to a less than significant level. The geotechnical report shall be subject to review and approval by the Palo Alto Building Division prior to grading activities. Hydrology Development within the SOFA 2 area shall incorporate Best Management Practices (BMP’s) as defined within Policy N-21 of the Comprehensive Plan, into project plans. The project applicant shall prepare a stormwater pollution prevention plan identifying the specific BMP’s to be followed during the project. Incorporation of the BMP’s identified in the prevention plan shall be completed prior to the issuance of any grading permit, and shall be subject to the approval of the City Public Works Engineering Division. (d)Groundwater or Soil Contamination (1)For all redevelopment projects on sites suspected by the City of containing groundwater or soil contamination within the planning area, the City shall require that the project applicant hire a qualified environmental testing company to collect and test random soil samples for analysis of soil and groundwater contamination. The environmental consultant, hired and paid for by the applicant, shall comply with all regulations governing sampling methodologies, shipping and handling procedures, and testing methodologies. The analysis shall comply with the planned schedule and analyti~:al procedures for providing the information specified in the State of California Environmental Protection Agency Department of Toxic Substances Control’s Preliminary Endangerment Assessment (PEA). (2)Validated data shall be submitted to: (A) the Santa Clara County Department of Health; i 9.30.02.FINA~ SOFA CAP P&TC Version.doc 64 October 01,2002 Chapter V Development Standards 5.130 Environmental Protection (e) (f) (3) (B) the Santa Clara Valley Water District; and (C)the State of California Environmental Protection Agency Department of Toxic Substances Control for review. In the event that contamination is discovered, affected soils shall be removed in compliance with all federal and state regulations governing clean-up procedures and disposal of hazardous materials. Clean up shall be certified as complete by the Santa Clara County Department of Health and the Santa Clara Valley Water District. Asbestos All development projects shall be comply with City of Palo Alto Fire Department standards and procedures for asbestos containing material. Demolition Waste All development projects subject to ARB or joint ARB/HRB review shall prepare construction recycling plans as part of the project approval process. The construction recycling plan shall be implemented through explicit provisions in demolition and construction contracts. The construction recycling plans shall include the following specific steps: (1)Recovery of concrete, asphalt, and other inert solids; (2)Recovery of scrap metals; (3)Salvage of building fixtures and other re-usable items; and (4)Siting containers at the construction site for cardboard, beverage containers, wood, and other recyclable materials. (g)Solid Waste Disposal All new development projects subject to ARB or joint ARB/HRB review shall prepare operation recycling plans as part of the project approval process. The ongoing programs shall describe the proposed diversion rates for different material types and the location to which they will be diverted, as well as locations, areas, types of bins, etc. In addition, the program should contain the following specific information: Specific locations, square footage, and equipment that would be used to hold and handle recyclables and solid waste; (2)The locations of containers within the retail facility near high volume pedestrian areas to encourage waste minimization and recycling; and (3)Store layouts that incorporate space for the storage of recyclable material, principally cardboard, prior to its movement to another area for processing and transport. 9.30.02.FINAL SOFA CAP P&TC Version.doc 65 October 01,2002 Chapter V Development Standards 5.130 Environmental Protection (h)Archaeological Resources In the event that archaeological resources or human remains are discovered during grading or construction activities, all work shall cease within 150 feet of the find until it can be evaluated by a qualified, professional archaeologist. If the find is determined to be significant, appropriate mitigation measures shall be developed and implemented in accordance with Appendix K of the CEQA Guidelines. Any discoveries shall be reported to the City of Palo Alto Community Development Director for forwarding to the Historic Resources Board. 9.30.02.F!NAL SOFA CAP P&TC Version.doc 66 October 0! ,2002 Chapter VI Implementation 6.010 Joint ARB/HRB Review Board Chapter Vi = implementation Section List 6.010 6.020 6.030 6.040 6.050 Joint ARB/HRB Review Board Permits, Exceptions, and Review Procedures Plan Amendments Establishment of Planned Community Districts SOFA 2 Historic Resource List Procedures The following chapter provides information on the approvals necessary for projects proposed within the SOFA 2 area, as well as provisions for the establishment of Planned Community districts, and procedures for designating and removing structures from the SOFA 2 Historic Resource List. The procedures in this Chapter VI are the only procedures applicable in the SOFA 2 area. In addition, this chapter creates a mechanism by which alterations can be made to the plan in the future. The Palo Alto Municipal Code (PAMC) sections referred to in this chapter are contained in Appendix H for reference. 6.010.Joint ARB/HRB Review Board There shall be a joint ARB/HRB review board for the purpose of reviewing the design of projects involving historic structures in the SOFA 2 area. The board shall review the design of projects on SOFA 2 Historic Resources or on sites adjacent to or across the street from SOFA 2 Historic Resources. The composition, procedures for appointment of members, and .meeting. procedures of the joint board shall be at the discretion of the Director of Planning and Community Environment, who shall establish written regulations regarding the joint board. All members of the joint board shall be either current members of the architectural review board or the historic resources board, and the joint board shall contain an equal number of members from each board. The joint board is subject to the Ralph M. Brown Act. Design review performed by the joint board shall be in the same manner as design review by the Architectural Review Board pursuant to PAMC Chapter 16.48. 6.020 Review Procedures (a)New Construction All new external alterations or improvements in the SOFA 2 area shall require a Coordinated Development Permit pursuant to Section 19.10.050. All such development, excluding single-family or two-family uses, shall also require a Certificate of Occupancy, pursuant to PAMC Section 16.04.120, prior to occupying any structure. A City of Palo Alto business license shall be required if the City adopts such a license in the future prior to occupying any structure. (b)Conditional Uses The permit granting procedure for all uses that require a conditional use permit, as specified in Chapter V of this CAP, shall be as set forth in Chapter 18.90 of the Palo Alto Municipal Code. 9.30.02.F!NAL SOFA CAP P&TC Version.doc 67 October 01, 2002 Chapter Vl Implementation 6.020 Review Procedures (c)Exceptions to Development Standards (d) (1)In the RT-35, RT-50, RM-15 and RM-30 districts, the only exceptions to the development standards that may be granted are variances and design enhancement exceptions: (A)Variances are discouraged, but shall be granted when necessary to avoid a regulatory taking. The procedure for the granting of variances shall be as set forth in PAMC Chapter 18.90. (2) (B)Design enhancement exceptions shall only be permitted for exceptions to landscaping, setbacks, parking lot design, and common or usable open space. Design enhancement exceptions .may be granted by either the architectural review board or the joint ARB/HRB review board in the manner set forth in Chapter 16.48. In the R-2 district, the only exceptions to development standards that may be granted are variances and home improvement exCeptions, pursuant to Title 18 of the PAMC. Review of New Construction or alteration: non-historic structures (1)Projects requiring a building permit, including a grading or demolition permit, are subject to design review pursuant to PAMC Chapter 16.48, with the following exceptions: (A)projects on SOFA 2 Historic Resources; (B)projects on sites adjacent to or across the street from a SOFA 2 Historic Resource (C) projects on Potential SOFA 2 Historic Resources (2)When reviewing projects under this subsection (d), the city shall use the compatibility requirements and design guidelines of Chapter IV of this CAP in addition to the design guidelines of PAMC Chapter 16.48. (e)Review of Projects on SOFA 2 Historic Resources (f) Exterior alterations requiring a building permit, including grading, shall be subject to review by the joint ARB/HRB review board when such projects are on sites on the SOFA 2 Historic Resource list. Exterior alterations do not include ordinary maintenance or repair. Small projects may be reviewed at the staff level, as set forth in subsection (h). The standards of review for projects on SOFA 2 Historic Resources shall be: (A)the compatibility requirements and design guidelines in Chapter IV of this CAP; and (B) the Secretary of the Interior Standards. Review of Projects near actual or potential SOFA 2 Historic Resources (1)Exterior alterations requiring a building permit, including grading, shall be subject to review by the joint ARB/HRB review board when such projects are Chapter VI Implementation 6.020 ¯ Review Procedures (2) on sites on adjacent to or across the street from a site on the SOFA 2 Historic Resource list or SOFA 2 Potential Historic Resource List. Exterior alterations do not include ordinary maintenance or repair. Small projects may be reviewed at the staff level, as set forth in subsection (h). This subsection shall not apply to SOFA 2 Historic Resources. The standards of review for projects on sites adjacent to or across the street from SOFA 2 Historic Resources shall be: (A)the guidelines in PAMC Chapter 16.48; (B)the design guidelines in Chapter IV of this CAP; and (C)the compatibility requirements in Chapter IV of this CAP, including the requirements for compatibility with historic structures. (g)Projects on Potential SOFA 2 Historic Resources Sites on the Potential SOFA 2 Historic Resources list shall undergo a study to determine their eligibility for the SOFA 2 Historic Resource list before undergoing any external alterations requiring a building permit, including a grading or demolition permit, except if the project conforms with the Secretary of the Interior’s Standards. External alterations do not include ordinary maintenance or repair. If the Director determines that a site meets the criteria for addition, to the SOFA 2 Historic Resource list, as set forth in 6.050, it shall be added to the List and shall undergo design review as specified in subsection (e). If such a site is found to be ineligible for the SOFA 2 Historic Resource list, it shall be removed from the SOFA 2 Potential Historic Resources List, and maybe required to undergo design review ¯ in conformance with subsections (d) or (f). (h)Staff Review of Small Projects on or near SOFA 2 Historic Resources (i) (J) For projects subject to joint ARB/HRB review, alterations that do not alter a street facing fagade, do not demolish more than twenty percent of the exterior walls, do not add to or enlarge the structure above the first floor, and do not construct, relocate or demolish an accessory structure are considered small projects and may be approved by staff in the manner set forth in Chapter 16.48 of the PAMC. Provided, appeals of this type of decision shall be forwarded to the joint ARB/HRB board. Administrative Approval of Minor Changes in Projects The provisions of Chapter 18.99 of the Palo Alto Municipal Code regarding administrative approval of minor changes in projects shall apply within the SOFA 2 area. Subdivisions, Parcel Maps, and other Land Divisions All divisions of property within the SOFA 2 Plan Area shall be reviewed and processed in accordance with the Subdivision Map Act and Title 21 (Subdivisions) of the PAMC. 9.30.02.F!NAL SOFA CAP P&TC Version.doc 69 October 01,2002 Chapter Vl :6.030 Implementation Plan Amendments 6.030 Plan Amendments Amendments to this Coordinate Area Plan may be initiated by any property owner in the SOFA 2 area, by motion of the city council at the request of the planning commission, or by the Director. Plan amendments shall be processed in the same manner as Comprehensive Plan amendments, as set forth in Section 19.04.080 of the Palo Alto Municipal Code. 6.040 Establishment of Planned Community Districts Planned community districts in the SOFA 2 area shall be established in the same manner as planned community districts elsewhere in the City, subject to the specific requirements of this CAP. All SOFA 2 planned community districts shall comply with the development standards and other regulations set forth in section 5.120. (a)Initiation Application for designation of a planned community district may be made as provided in Chapter 18.68 of the Municipal (b)Application Contents In addition to that information required under Chapter 18.68 for a planned community district application, the applicant shall submit a written statement explaining how the proposed district is consistent with the SOFA CAP, Phase 2. (c)Additional Materials Required In addition to the application, the applicant shall submit the following items: (1)A development program statement, as described in PAMC Section 18.68.080; (2) (3) (4) (5) A development plan, as described in PAMC Section 18.68.090; A development schedule, as described in PAMC Section 18.68.100; and A fee, as prescribed by the municipal fee schedule, shall be submitted with the application, no part of which shall be returnable to the applicant. The parking and loading plan, showing the number of spaces and the location shall be based upon the requirements of Section 5.080 of Chapter V of this CAP, unless requested modifications to meet the needs of the individual project are supported by traffic engineering studies or other relevant data, demonstrating the feasibility and adequacy of the plan. (d)Approval Process (1)Initial review by the planning and transportation commission (A)The applicant for a PC district shall initially submit to the planning and transportation commission a development program statement, development plan., and a development schedule, which are described 9.30.02.F!NAL SOFA CAP P&TC Version.doc 70 October 0!, 2002 Chapter Vl Implementation 6.040 Establishment of Planned Community Districts (B) (c) in subsection (c). The plot plans, landscape development plan, and design plan in the development plan should only be preliminary during this phase of review by the planning commission. If the planning and transportation commission acts favorably in its initial review of the PC application, the development plan ~hall then be submitted to the architectural review board (ARB) or joint ARB/HRB for review, as set forth in subsection (d)(2). If the planning commission acts unfavorably in its initial review of the application, the commission shall recommend denial, and the recommendation shall be forwarded directly to the city council for review under subsection (d)(5). (2)Review by the Architectural Review Board or Joint ARB/HRB Board In this phase, a detailed plot plan, landscape development plan, and design plan of the development plan shall be submitted for design review pursuant to Chapter 16.48 of the Palo Alto Municipal Code and this CAP. The development plan as approveid by the board is then returned to the planning and transportation commission for its final review and recommendation, as set forth in subsections (3) and (4), before being submitted to the city council for final action. (3)Planning and transportation commission final review: The planning and transportation commission shall review and consider all materials submitted by the applicant pursuant to this chapter, and shall prepare and recommend to the city council, as appropriate, the specific regulations to be applied within the proposed planned community district. The specific regulations may modify those regulations contained in this Coordinated Area Plan, subject to the limitations of section 5.120 of Chapter V, as is appropriate to meet the individual district needs and shall include the items listed in PAMC 18.68.110. (4)Final planning and transportation commission recommendation The decision of the commission shall be rendered within a reasonable time following the close of any public hearing or hearings and the written recommendation of the commission shall be forwarded to the council within thirty days. The recommendation of the commission shall set forth fully the findings and determinations of the commission with respect to the application. (5)Council Action Upon receipt of the recommendation of the commission on establishment of or change to a SOFA 2 PC District, the council shall hold a noticed public hearing on the matter. After consideration of the recommendation of the commission, and the completion of a public hearing, the council may approve, modify, or disapprove the proposed establishment of or change to a SOFA 2 PC District. Should the council determine establishment of or change to a SOFA 9.30.02.F.NA_ SOFA CAP P&TC Version.doc 7!October 0! 2002 Chapter VI Implementation 6.040 Establishment of Planned Community Districts 2 PC district is appropriate, such establishment or change shall be accomplished by ordinance amending the SOFA 2 PC and the Palo Alto Zoning Map. (h)Findings Required for Approval (i) (J) The planning and transportation commission, prior to recommending approval of any PC district, and the city council,~ prior to approving an ordinance designating and regulating any PC district, shall make all of the following findings with respect to the application: .......... ~ (1)The site is so situated, and the use or uses proposed for the site are of such characteristics that the SOFA 2 PC is necessary tO accommodate them within the SOFA Phase2 areal~ (2)Development of the site under th~iprovisions of the SOFA 2 PC will result in public benefits not otherwise attainable by application 0fthe regulations of Residential Transitional Districts. In making the findings required by this section, the p!anning andlransportation commission and city council, as appropriate, shall ispecifically cite the public benefits expected to result from use of the planned community district. Those public benefits shall be from the list established by Section 5.120(e) of Chapter V of this CAP. (3)The use or uses permitted, and the site development regulations applicable within the district shall be consistent with the purposes of the Palo Alto Comprehensive Plan and this Coordinated Area Plan, and shall be compatible with existing and potential uses on adjoining sites or within the general vicinity. (4)The proposed mix of .uses on the site is predominantly or exclusively residential. Hearing Notice Notice of planning commission or city council hearings shall be given as provided in PAMC Section 18.98.060. Post-approval Requirements The following regulations shall apply to any PC district approved pursuant to this section: (1)Change in development schedule For good cause shown by the property owner in writing and unless otherwise specified by the specific applicable regulations for the district, prior to the expiration of the original time schedule for the development, the director may, without a public hearing, modify the time limits imposed by any adopted development schedule; provided, that such modification shall not extend the schedule by more than one year; and provided, that only one such modification may be made. 9.30.02.F!NAL SOFA CAP P&TC Vers.on.doc 72 October 01,2002 Chapter VI Implementation 6.040 Establishment of Planned Community Districts (2)Failure to meet development schedule Sixty days prior to the expiration of the development schedule, the director shall notify the property owner in writing of the date of expiration. Failure to meet the approved development schedule, including an extension, if granted, shall result in:, (A)The expiration of the property owner’s right to develop under the PC district. The zoning administrator shall notify the property owner, the city council, the planning commission and the building official of such ..... expiration; and (B) The zoning administrator’s initiating a zone change for the property subject to the PC district in accordance with Chapter 18.98 of the Palo Alto Municipal Code. The property owner may submit a new application for a PC district concurrently with the zoning administrator’s recommendation for a zone change. (3) Resubmittal of Application When an application for establishment of a planned community district has been submitted by a property owner and subsequently denied by the council, no new application by a property owner for the same change, or for substantially the same change, either with respect to properties included within the proposed change or with respect to proposed district classifications, or both, shall be filed or accepted by the zoning administrator within one year of the date of closing of the hearing before the commission,. except upon a showing to the satisfaction of the zoning administrator of a .. ¯ substantial change of circumstances. 9.30.02.F!NAL SOFA CAP P&TC Version.doc 73 October 0! ,2002 Chapter VI Implementation 6.050 SOFA 2 Historic Resource List Procedures 6.050 SOFA 2 Historic Resource List Procedures (a) Historic Resource Lists The director shall maintain the following: (2) the SOFA 2 Historic Resource List, a list of historic resources in the SOFA 2 area. The initial list includes those properties in the SOFA 2 area that were on the Palo Alto Historic Inventory at the time of adoption of this CAP, and may be updated from time to time in compliance with this section. The initial list is set forth in Appendix B-1. Category 3 and 4 residences in the R-2 District are not included in Appendix B-I. the Potential SOFA 2 Historic Resource List, a list of sites in the SOFA 2 area that may, upon further study, qualify for inclusion on the SOFA 2 Historic Resource List. The initial list includes those properties that, prior to adoption of this CAP, were determined by qualified experts to be potentially eligible for the National or California Register, and Category 3 and 4 residences in the R-2 District. The initial list is set forth in Appendix B-2. (b)Owner-Initiated Additions to the SOFA 2 Historic Resource List The owner of any property may request that the property be added to the SOFA 2 Historic Resource List. For such a request, application shall be made to the Director in a manner specified by the Director. If the Director determines, after review and recommendation by the historic resources board, and evidence from a qualified expert, that a property meets the criteria for inclusion on the SOFA 2 Historic Resource List, the property shall be added to the List. Such determination shall be made within 90 days of receipt of a completed application. The criteria for inclusion on the. SOFA 2 Historic Resource shall be substantial evidence, in light of the record as a whole, that the property is eligible for the National or California Register. (c)Removal from the SOFA 2 Historic Resources and Potential Historic Resources Lists The owner of any property on the SOFA 2 Historic Resource List or Potential SOFA 2 Historic Resource List may request removal from either list at any time. For such a request, application shall be made to the Director in a manner specified by the Director. In addition, the Director may initiate a request for removal of any property from either list at any time. If the Director determines, after review and recommendation by the historic resources board, and evidence from a qualified expert, that a property does not meet the criteria for inclusion on the SOFA 2 Historic Resource List, the property shall be removed from the applicable List. Such determination shall be made within 90 days of receipt of a completed application, in the case of an owner-initiated review. The criteria for removal from the SOFA 2 Historic Resource List or the Potential SOFA 2 Historic Resource List shall be substantial evidence, in light of the record as a whole, that the property is not eligible for the National or California Register. 9.30.02.F!NAL SOFA CAP P&TC Version.doc 74 October 0!, 2002 Chapter VI Implementation 6.040 Palo Alto Historic Inventory Procedures (d) (e) Transfers from the SOFA 2 Potential Historic Resources List to the SOFA 2 Historic Resources List The Director may initiate review of a property on the SOFA 2 Potential Historic Resources List at any time to determine its eligibility for the SOFA 2 Historic Resources List. If the Director determines, after review and recommendation by the historic resources board, and evidence from a qualified expert, that a property meets the criteria for inclusion on the SOFA 2 Historic Resource List, the property shall be added to the List. If the Director determines, after such review and recommendation, that the property does not meet the criteria for inclusion on the List, the property shall be removed from the SOFA 2 Potential Historic Resources List. The criteria for inclusion on the SOFA 2 Historic Resource shall be substantial evidence, in light of the record as a whole, that the property is eligible for the National or California Register. Review of SOFA 2 Historic Resources Properties on the SOFA 2 Historic Resource List are subject to the review procedure set forth in 6.020(e). (f)Review of SOFA 2 Potential Historic Resources Properties on the SOFA 2 Potential Historic Resource List shall undergo a study to determine eligibility for the SOFA 2 Historic Resource List prior to undergoing any major external alteration, addition, or demolition, as set forth in 6.020(g). 9.30.02.F!NAL SOFA CAP P&TC Version.doc 75 October 0! ,2002 APPENDIX A DISTRICTS RT-35 Residential Transition 35’ RT-50 Residential Transition 50’ RM-15 SOFA 2 RM-15 District PC R-2 RM-30 Planned Community District SOFA 2 R-2 District SOFA 2 RM-30 District N 0’25’ 50’ 100’ FREEDMAN TUMG 5 DOTTOMLEY South of Forest Area District Map SOFA PHASE 2 Coordinated Area Plan s:\Plan\Plsdiv\Lisa~Sola\planning commission discussion_updt.pd[ Appendix B-1 SOFA 2 Historic Resource List APPENDIX B SOFA 2 HISTORIC RESOURCES AND SEISMIC HAZARDS Appendix B contains the list of historic resources and seismic hazards in the SOFA 2 area at the time of adoption of this Coordinated Area Plan. These lists will be maintained by the city and may be updated from time to time. Appendix B-1 lists buildings and sites that are SOFA 2 Historic Resources, and therefore are entitled to bonuses and subject to restrictions under this CAP. Appendix B-2 lists buildings and sites that are Potential SOFA 2 Historic Resources, and will require further study to establish their historic status prior to undergoing exterior alteration. Appendix B-3 lists those buildings that have been designated as seismic hazards, and are given incentives under this CAP to reduce those hazards. Appendix B=I SOFA 2 Historic Resource List The following buildings are SOFA 2 Historic Resources: Address Parcel Number Alma Street 799 ......................................................120-27-079 Emerson Street 800 ......................................................120-28-006 Hiqh Street 790 ......................................................120-27-078 865 ......................................................120-28-039 900 ......................................................120-28-049 Homer Avenue 200 ......................................................120-28-007 201 .......................................: ..............120-27-070 209 ................= .....................................120-27-070 210 ......................................................120-28-008 212-214 ...............................................120-28-009 230 ......................................................120-28-010 232 ......................................................120-28-011 248 ......................................................120-28-012 Ramona Street 734 ......................................................120-27-066 n ")n nO ElklAI qihlZ’A t"’AD D.~’.T(" \/arelnn Ann 77 October 0!, 2002 Appendix B-2 SOFA 2 Potential Historic Resource List Appendix B-2 SOFA 2 Potential Historic Resource List The following buildings are ~SOFA 2 Potential Historic Resources. Potentially national register eligible buildings, according to the final Dames and Moore Survey are marked NRE: Address Parcel Number ~ Addison Avenue 181 ......................................................120-28-088 ......................................NRE 225 ......................................................120-28-075 Alma Street 955 ......................................................120-28-096 Eme~on Street 728-732...i ...........................................120-27-074 731 ......................................................120-27-071 936-944 ...............................................120-28-087 945 ......................................................120-28-079 ...................................... NRE Hiqh Street 744 ......................................................120-27-077 831 ......................: ...............................120-28-041 Homer Avenue 140 ......................................................120-28-002 Ramona Street 904 ......................................................120-28-053 926 ......................................................120-28-070 934 ......................................................120-28-071 942 ......................................................120-28-072 948 ......................................................120-28-073 9.30.02.FINAL SOFA CAP P&TC Version.doc 78 October 0!, 2002 Appendix B-3 SOFA 2 Seismic Hazard List Appendix B-3 SOFA2 Seismic Hazard List The following buildings have been designated SOFA 2 Seismic Hazards: 2. 3. 4. 67 Alma Street 847 Emerson Street 949 Emerson Street 232 Homer Street 9.30o02.F!NAL SOFA CAP P&TC Version.doc 79 October 0!, 2002 Appendix C-1 SOFA 2 Specific Definitions APPENDIX C DEFiNiTIONS ’ Appendix C-1 contains definitions specific to this Coordinated Area Plan. In addition, the definitions contained in Palo Alto Municipal Code Chapter 18.04, as amended from time to time, shall apply to this Coordinated Area Plan. Chapter 18.04 is included in Appendix C-2 as a reference only. Where. a definition in Appendix C-1 conflicts.with a definition in Title 18, Appendix C-1 shall prevail. Appendix C=1 SOFA2 Specific Definitions The following definitions shall apply for the purposes of the Coordinated Area Plan: (a)"BMR Unit" shall mean a housing unit that, if for-sale, has an initial sales price that is consistent with what a household making 80 to 100 percent of the Santa Clara County median income can afford in housing expenses, such as mortgage payment, taxes, insurance, and association dues. If the unit is for rent, a BMR unit is a housing unit that has an initial rent equivalent to the HUD Section 8 (or its successor program) Fair Market Rent, adjusted annually by not more than one- third of the Consumer Price Index or other comparable formula agreed to by the .city. (b)"California Register" means the historic register established by California Public Resources Code Section 5024.1, as amended. (c)A "Change of Use" is the replacement of an existing use, or change in the existing use, from one of the uses listed in Section 5.020 to another. For example, a change from "medical and professional office" to "general business office" is a change in use. A change from a doctor’s office to a lawyer’s office is not, as both are classified as "medical and professional offices." If the existing or new use is not listed in Section 5.020, then change of use shall refer to replacement of an existing use, or change in the existing use, excluding changes in ownership or management, but including changes in the nature of the use or line ofbusiness. For example, a change from manufacturing shoes to manufacturing bicycles would constitute a change of use, even though both are defined as "manufacturing." The acquisition of a local shoe manufacturer by a new owner would not constitute a change of use. (d)"Director" means the Director of planning and community environment or his or her designee. (e)"National Register" means the historic register established by the National Historic Preservation Act of 1966 (16 USC 470), as amended. (f)A "Non-conforming use" is one that was lawfully in existence on ~ate of~he CAP],: but which is not permitted, either as of right, or conditionally, under the CAP. A non-conforming use includes one that is permitted in SOFA 2, either as of right, or conditionally, but (i) exceeds the size permitted on the site 9.30.02.F!NAL SOFA CAP P&TC Version.doc 80 October 01, 2002 Appendix C-1 SOFA 2 Specific Definitions (g) (h) (i) (k) (i) under the CAP or (ii) is located in an area, such as a street-facing ground floor, where such a use is not allowed under the CAP. A "Non-complying facility" means a structure or building that was lawfully in existence under its zoning c ass f cat on pr or td:i{~ ~!i~ ~i~:~ ~~i but which violates one or more provisions of Chapter 5 of the CAP. "PAMC" means the Palo Alto Municipal Code "Secretary of the Interior Standards" means the Secretary of the United States Department of the Interior’s Standards for Rehabilitation of Historic Buildings, issued by the National Park Service (36 Code of Federal Regulations Part 67), together with the accompanying interpretive Guidelines for Rehabilitating Historic Buildings, as they may be amended from time to time. "Senior Housing" means housing that incorporates facilities and services to meet the health care, transit, or social service needs of seniors and qualifies as senior housing under state or federal law. Meeting the housing needs of seniors may require selecting sites near shopping areas, social activities, medical services, and transit lines. "SOFA 2 Historic Resources" means those buildings and sites on the SOFA 2 Historic Resource List as changed from time to time in accordance with the procedures in this CAP. "SRO Housing", or Single-Room Occupancy housing, shall mean a hotel or residential structure that provides short-term and transitional housing. Units may or may not have kitchens or bathrooms within each individual unit. 9.30.02.F!NAL SOFA CAP P&TC Version.doc 81 October 01,2002 Appendix C-2 PAMC Chapter 18.04 - Definitions Appendix C-2 PANIC Chapter 18.04 - Definitions Chapter 18.04 DEFINITIONS Sections: 18.04.010 18.04.020 18.04.030 Purpose and applicability. General rules for construction of language. Definitions. 18.04.010 Purpose and applicability. The purpose of this chapter is to promote consistency and precision in the interpretation of the zoning regulations. The meaning and construction of words and phrases defined in this chapter shall apply throughout the zoning regulations, except where the context of such words or phrases clearly indicates a different meaning or construction. (Ord. 3048 (part), 1978) 18.04.020 General rules for construction of language. The following general rules of construction shall apply to the text of the zoning regulations: (a)The particular shall control the general. (b)In case of any difference of meaning or implication between the text of any provision and any caption or illustration, the text shall control. (c) The word "shall" is always mandatory and not discretionary. The word "may" is discretionary. (d)References in the masculine and feminine genders are interchangeable. (e)Words used in the present tense include the future, and words used in the singular include the plural, and the plural the singular, unless the context clearly indicates the contrary. (f)The words "activities" and "facilities" include any part thereof. (g)Unless the context clearly indicates to the contrary, the following conjunctions shall be interpreted as follows: (1)"And" indicates that all connected items or provisions shall apply. (2)"Or" indicates that the connected items or provisions may apply singly or in any combination. (3) "Either...or" indicates that the connected items or provisions shall apply singly but not in combination. (h) "District" means a general district or a combining district established by this title, unless otherwise indicated by specific reference to another kind of district. Appendix C-2 PAMC Chapter 18.04 - Definitions (i) All public officials, bodies, and agencies to which reference is made are those of the city unless otherwise indicated. (j) "City" means the city of Palo Alto. (Ord. 3048 (part), 1978) 18.04~030 Definitions. (a) Throughout this title the following words and phrases shall have the meanings ascribed in this ’section. (1) "Abandon" means to cease or discontinue a use or activity without intent to resume, but excluding temporary or short-term interruptions to a use or activity during periods of remodeling, maintaining, or otherwise improving or rearranging a facility, or during normal periods of vacation or seasonal closure. (2)"Abutting" means having property or district lines in common. (3)"Accessory building" means a building which is incidental to and customarily associated with a specific principal use or facility, and which meets the applicable conditions set forth in Chapter 18.88. (4) "Accessory dwelling" means a dwelling unit accessory to a principal use on a site and intended for occupancy by persons residing therein by reason of employment of one or more occupants on the same site. (5) "Addition" .means any construction which increases the size of a building or facility in terms of site coverage, height, length, width, or gross floor area. (6) "Administrative office services" means offices .and service facilities performing headquarters, regional, or other level management and administrative services for firms and institutions. (7) "Airport-related use" means a use providing aviation-related services typically ancillary to operations of an airport including, but not limited to, aircraft repair and maintenance, flight instruction, and aircraft chartering. (8) "Alley" means a public or private vehicular way less than twenty-five feet in width affording a secondary means of vehicular access to abutting property. (9)Reserved. (10)Reserved. (11)"Alteration" means any construction or physical change in the internal arrangement of rooms or the supporting members of a building or structure, or change in relative position of buildings or structures on a site, or substantial change in appearance of any building or structure. (A) "Incidental alteration" means any alteration to interior partitions or interior supporting members of a structure which does not increase the structural strength of the structure; any alteration to electrical, plumbing, heating, air conditioning, ventilating, or other utility services, fixtures or appliances; any addition, closing, or change in size of doors or windows in the exterior wallsi or any replacement of a building facade which does not increase the structural strength of the structure. (B)"Structural alteration" means any alteration not deemed an incidental alteration. Appendix C-2 PAMC Chapter 18.04 - Definitions (12) "Animal care" means a use providing grooming, housing, medical care, or other services to animals, including veterinary services, animal hospitals, overnight or short-term boarding ancillary to veterinary care, indoor or outdoor kennels, and similar services. (13) "Automobile service station" means a use providing gasoline, oil, tires, small parts and accessories, and services incidental thereto, for automobiles, light trucks, and similar motor vehicles. The sale of food or grocery items or alcoholic beverages on the same site is prohibited except for prepackaged soft drinks, cigarettes, and snack foods either from automatic vending machines or in shelves occupying a floor area not to exceed forty square feet. (14) "Automotive services" means a use engaged in sale, rental, service, or major repair of new or used automobiles, trucks, trailers, boats, motorcycles, recreational vehicles, or other similar vehicles, including tire recapping, painting, body and fender repair, and engine, transmission, air conditioning, and glass repair and replacement, and similar services. (15) "Basement" means that portion of a building between floor and ceiling, which is fully below grade or partly below and partly above grade, but so located that the vertical distance from grade to the floor below is more than the vertical distance from grade to ceiling. (16) "Below market rate (BMR) housing unit" means any housing unit sold or rented to low or moderate income persons pursuant to the city ofPalo Alto’s below market rate program administered by the Palo Alto housing corporation, or a successor organization. (17) "Bicycle parking space" means an area specifically reserved and intended for parking of a bicycle, accessible to the user independently of any other bicycle parking space, and including such additional features or conveniences as specified by this title. (18) "Block" means any lot or group of contiguous lots bounded on all. sides by streets, railroad rights-of-way, or waterways, and not traversed by any street, railroad right-of-way, or waterway. (19)Reserved. (20)Reserved. * (21) "Breezeway" means a building or specific portion thereof, not over 3.7 meters (twelve feet) in height at the ridge line, which connects two otherwise separate buildings, and which is not more than fifty percent enclosed at the perimeter, including the wall surfaces of the buildings so connected. (22) "Building" means any structure used or intended for supporting or sheltering any use or occupancy. (23) "Business or trade school" means a use, except a college or university, providing education or training in business, commerce, language, or other similar activity or pursuit, and not otherwise defined as a home occupation or private educational facility. a.ou.O/.rll~l/~L oOr/~ bAr P&TC v~,a,u,,.uuu o’*October Appendix C-2 PAMC Chapter 18.04 - Definitions (24) "Canopy" means any roof-like structure, either attached to another structure or freestanding, or any extension of a roof line, constructed for the purpose of protection from the elements in connection with outdoor living. (25) "Cellar" means that portion of a building between floor and ceiling which is wholly or partly below grade and so located that the vertical distance from grade to the floor below is equal to or greater than the vertical distance from grade to ceiling. (24.5) "Carport" means a portion of a principal residential building or an accessory building to a residential use designed to be utilized for the shelter of one (1) or more motor vehicles, which is open (unenclosed) at the vehicular entry side and which has no more than two sides enclosed.. (26) "Change of use" means the replacement of an existing use by a new use, or a change in the nature of an existing use, but not including a change of ownership, tenancy, or management where the previous nature of the use, line of business, or other function is substantially unchanged. (See also subdivisions (A) through (F) of subsection (143) of this Section 18.04.030.) (27) "Church" means a use providing facilities for regular organized religious worship and religious education incidental thereto, but excluding a private educational facility. A property tax exemption obtained pursuant to Section 3(f) of Article XIII of the Constitution of the State of California and Section 206 of the Revenue and Taxation Code of the State of California, or successor legislation, constitutes prima facie evidence that such use is a church as defined in this section. (28)Reserved. (29)Reserved. (30)Reserved. (31)"College" or "university" means an educational institution of higher learning which offers a course of studies designed to culminate in the issuance of a degree as defined by Section 94302 of the Education Code of the State of California, or successor legislation. (32) "Combining district" means a district established by this title, Which may be applied to a lot or portion thereof only in combination with a general district. More than one combining district may apply to the same lot or portion thereof. (33) "Commercial recreation" means a use providing recreation, amusement, exercise or entertainment services, including theaters, bowling lanes, billiard parlors, skating arenas, gymnasiums, exercise studios or facilities, fitness centers, health clubs or spas, martial arts studios, group movement instruction, and similar services, operated on a private or for-profit basis, but excluding uses defined as outdoor recreation services defined in subsection (107). (34) "Community center" means a place, structure, area, or other facility used for and providing religious, fraternal, social and!or recreational programs generally open to the public and designed to accommodate and serve significant segments of the community. (35) "Convalescent facility" means a use other than a residential care home providing inpatient services for persons requiring regular medical attention, but not providing surgical or emergency medical services. Appendix C-2 PAMC Chapter 18.04 - Definitions (36)"Corporation yard" is defined in subsection (52). (37)Reserved. (38)"Court" means a space open and unobstructed to the sky, located at or above grade level on a lot, and bounded on three or more sides by walls of a building. (39)Reserved. (40)Reserved. (41)"Covered parking" means a carport or garage that provides full overhead protection from the elements with ordinary roof coverings. Canvas, lath, fiberglass, and vegetation are not ordinary roof coverings and cannot be used in providing a covered parking space. (42) "Day care center" means a day care facility licensed by the state or county for nonmedical daytime care. This term includes, but is not limited to, nursery schools, preschools and similar facilities. (43)Day Care Home. (A)"Family day care home" means a home licensed by the state or county which regularly provides care, protection, and supervision of twelve or fewer children under the age of eighteen, in the provider’s own home, for periods of less than twenty- four hours per day, while the parents or guardians are away and includes the following: (i) "Large family day care home" means a home which provides family care to seven to twelve children, inclusive, including children under age eighteen who reside at the home. This term includes, but is not limited to, nursery schools, preschools, and similar facilities. (ii) "Small family day care home" means a home which provides family day care to six or fewer children, including children under age eighteen who reside at the home. This term includes, but is not limited to, nursery schools, preschools, and similar facilities. (B) "Adult day care home" means use of a dwelling unit or portion thereof, licensed by the state or county, for daytime care and supervision of twelve or fewer persons, above the age of eighteen, and includes the following: (i) "Large adult day care home" means a home which provides daytime care of seven to twelve adults. (ii) "Small adult day care home" means a home which provides daytime care to six or fewer adults. (43a) Deleted [Ord. 4642 § 32] *(44) "Daylight plane" means an inclined plane, beginning at a stated height above average grade, that average grade being an average of the grade at the midpoint of the building and the grade at the closest point on the abutting site, and extending into the site at a stated upward angle to the horizontal, which may limit the height or horizontal extent of the building at any specific point where the daylight plane is more restrictive than the height limit applicable at such point on the site. The "daylight plane" shall be measured separately for each building on a lot, and separately for each side of each building. Appendix C-2 PAMC Chapter 18.04 - Definitions (45) "Drive-in service" means a feature or characteristic of a use involving sales of products or provision of services to occupants in vehicles, including drive-in or drive-up windows and drive-through services such as mechanical automobile washing. (46) "Dwelling unit" means a room or group of rooms including living, sleeping, eating, cooking, and sanitation facilities, constituting a separate and independent housekeeping unit, occupied or intended for occupancy by one family on a nontransient basis and having not more than one kitchen. (47) "Eating and drinking service" means a use providing preparation and retail sale of food and beverages, including restaurants, fountains, cafes, coffee shops, sandwich shops, ice cream parlors, taverns, cocktail lounges and similar uses. Related definitions are contained in subsections (45) and (136). (48)Reserved. (49)Reserved. (50)Reserved. * (51) "Enclosed" means a covered space fully surrounded by walls, including windows, doors, and similar openings or architectural features, or an open space of less than 9.3 square meters (one hundred square feet) fully surrounded by a building or walls exceeding 2.4 meters (eight feet) in height. (51.5) "Envelope" means the three-dimensional spatial configuration of a building’s volume and mass. (52) "Equipment yard" means a use providing for maintenance, servicing, or storage of motor vehicles, equipment, or supplies, or for the dispatching of service vehicles; or distribution of supplies or construction materials required in connection with a business activity, public utility service, transportation service, or similar activity. "Equipment yard" includes a construction materials yard, corporation yard, vehicular service center or similar use. (53) "Facility" means a structure, building or other physical contrivance or object. (A) "Accessory facility" means a facility which is incidental to, and customarily associated with, a specified principal facility, and which meets the applicable conditions set forth in Chapter 18.88. (B) "Noncomplying facility" means a facility which is in violation of any of the site development regulations or other regulations established by this title, but was lawfully existing on July 20, 1978, or any amendments to this title, or the application of any district to the property involved by reason of which adoption or application the facility became noncomplying. (For the definition for "nonconforming use" see subsection (143)(B)). (C) "Principal facilities" means a main building or other facility which is designed and constructed for or occupied by a principal use. (54) "Family" means an individual or group of persons living together who constitute a bona fide single housekeeping unit in a dwelling unit. "Family" shall not be Appendix C-2 PAMC Chapter 18.04 - Definitions construed to include a fraternity, sorority, club, or other group of persons occupying a hotel, lodginghouse, or institution of any kind. (55) "Farmers’ market" means a market certified by the state or county agricultural commission under Title 3, Chapter 3, Article 6.5 of the California ¯Administrative Code which allows direct retail sale by farms to the public of such items as fruits, vegetables, nuts, eggs, honey, nursery stock, cut flowers, live animals and inspected meats and seafood. (56) "Financial service" means a use providing financial services to individuals, firms, or other entities. The term "financial service" includes banks, savings and loan institutions, loan and lending institutions, credit unions and similar services. * (57) "Floor area ratio" means the maximum ratio of gross floor area on a site to the total site area. (57.5) "Footprint" means the two-dimensional configuration of a building’s perimeter boundaries as measured on a horizontal plane at ground level. (58) "Full cash value" has the meaning assigned to it in the Revenue and Taxation Code for property taxation purposes. (59)Reserved. (60)Reserved. (61)"General business office" means a use principally providing services to individuals, firms, or other entities, including but not limited to real estate, insurance, property management, title companies, investment, personnel, travel, and similar services, and including business offices of public utilities or other activities when the service rendered is that customarily associated with administrative office services. (62) "General district" means a district created by this title establishing basic regulations governing land use and site development. Not more than one general district designation shall apply to the same portion of a lot. (63) "General business service" means a use engaged in sales, servicing, installation, and repair services, or the performance of activities and services of the general ,nature described in this section, including printing, blueprinting and publishing, commercial bakeries, creameries or catering, cabinetry and furniture repair, bulk cleaning and laundry services (including a service that provides cleaning or laundry services for cleaning and laundry stations on other sites), lumber, plumbing, electrical, sheet metal, and other construction and building materials, and automobile parts and supplies. (64) "Grade" means the lowest point of adjacent ground elevation of the finished surface of the ground paving, or sidewalk, excluding areas where grade has been raised by means of a berm, planter box, or similar landscaping feature, unless required for drainage, within the area between the building and the property line, or when the property line is more than five feet from the building, between the building and a line five feet from the building. In building areas with natural slopes in excess often percent, "grade" shall mean the adjacent ground elevation of the finished or existing grade, whichever is lower. Appendix C-2 PAMC Chapter 18.04 - Definitions (i) (ii) (iii) (iv) (v) official; (vi) breezeways (vii) (64.5) "Grandfathered" means a designation established by means of a "grandfather clause," exempting a class of uses or structures from the otherwise currently applicable provisions of this title, because such uses or structures conformed with earlier applicable provisions of this title, prior to the enactment of subsequent provisions. (65)(A) "Gross floor area" means the total area of all floors of a building measured to the outside surfaces of exterior walls, and including the following: Halls; Stairways; Elevator shafts; Service and mechanical equipment rooms; Basement, cellar or attic areas deemed usable by the chief building Open or roofed porches, arcades, plazas, balconies, courts, walkways, or porticos if located above the ground floor and used for required access; Permanently roofed, but either partially enclosed or unenclosed, building feattires used for sales, service, display, storage or similar uses; (viii) In residential districts, all roofed porches, arcades, balconies, porticos, breezeways or similar features when located above the ground floor. (B)Gross floor area shall not include the following: (i)Parking facilities accessory to a permitted or conditional use and located on the same site; (ii) Roofed arcades, plazas, walkways, porches, breezeways, porticos, and similar features not substantially enclosed by exterior walls, and courts, at or near street level, when accessible to the general public and not devoted to sales, service, display, storage or similar uses. (iii) Except in the CD District and in areas designated as special study areas, minor additions of floor area approved by the director of planning and community environment for purposes of resource conservation or code compliance, upon the determination that such minor additions will increase compliance with environmental health, safety or other federal, state or local standards. Such additions may include, but not be limited to, the following: a. Area designed for resource conservation, such as trash compactors, recycling and thermal storage facilities; b. Area designed and required for hazardous materials storage facilities, handicapped access or seismic upgrades; (iv) In commercial and industrial districts except in the CD District and in areas designated as special study areas, additions of floor area designed and used solely for on-site employee amenities for employees of the facility, approved by the director of planning and community environment, upon the determination that such additions will facilitate the reduction of employee vehicle use. Such additions may include,, but not be limited to, recreational facilities, credit unions, cafeterias and day care centers. (C) In the R-1 and R-E single-family residence districts, "gross floor area" means the total covered area of all floors of a main structure and accessory structures greater than one hundred twenty square feet in area, including covered parldng and Appendix C-2 PAMC Chapter 18.04 - Definitions stairways, measured to the outside surface of exterior walls, subject to the following exceptions: (i) Floor area where the distance between the floor and the roof directly above it measures 5.18 meters (seventeen feet) or more, shall be counted twice; (ii) Floor area where the distance between the floor and the roof directly above it measures 7.92 meters (twenty-six feet) or more shall be counted three times; (iii) Basements where the finished level of the first floor is not more than .91 meters (three feet) above the grade around the perimeter of the building foundation, shall be excluded from the calculation of gross floor area, provided that lightwells, stairwells and other excavated features comply with the provisions of Section 18.10.050(m), 18.12.050(o), 18.17.050(p), or 18.19.050(o), as applicable; and (iv) 60.69 square meters (two hundred square feet) of unusable third floor equivalent, such as attic space, shall be excluded from the calculation of gross floor area. (v) Carports shall be counted toward the maximum allowable floor area ratio requirements. (66) "Guest cottage" means an accessory building containing a lodging unit without kitchen facilities, and used to house occasional visitors or nonpaying guests of the occupants of a dwelling unit on the same site. (67) "Height" means the vertical distance above grade to the highest point of the coping of a flat roof or to the deck line of a mansard roof or to the average height of the highest gable of a pitched or hipped roof, except that in the R-I, R-2 and RMD Districts the height of a pitched or hipped roof shall be measured to the height of the peak or highest ridge line. The height of a stepped or terraced building is the maximum height of any segment of the building. (68)Reserved. (69)Reserved. (70)Reserved. (71)"Home occupation" means an accessory activity conducted in a dwelling unit solely by the occupants thereof, in a manner incidental to residential occupancy, in accord with the provisions of this title. (For further provisions, see regulations for home occupations in Section 18.88.130.) (72) "Hospital" means a facility providing medical, psychiatric, or surgical services for sick or injured persons primarily on an in-patient basis, and including ancillary facilities for outpatient and emergency treatment, diagnostic services, training, research, administration, and services to patients, employees, or visitors. (73) "Hotel" means a facility containing rooms or groups of rooms, generally without individual kitchen facilities, used orintended to be used for use by temporary overnight occupants, whether on a transient or residential occupancy basis, and whether or not eating facilities are available on the premises. "Hotel" includes a motel, motor hotel, tourist court, or similar use, but does not include mobile home parks or similar use. (74) "Impervious area" means the portion of land on a lot that is covered by structures, paved surfaces, uncovered porches or similar cover and is incapable of being penetrated by water under normal circumstances. Appendix C-2 PAMC Chapter 18.04 - Definitions (75) "Kitchen" means a room designed, intended or used for the preparation of food. (76) "Landscaping" means an area devoted to or developed and maintained with native or exotic plantings, lawn, ground cover; gardens, trees, shrubs, and other plant materials, decorative outdoor landscape elements, pools, fountains, water features, paved or decorated surfaces of rock, stone, brick, block, or similar material (excluding driveways, parking, loading, or storage areas), and sculptural elements. (77) "Liquor store" means a use requiring a State of California "off-sale general license" (sale for off-site consumption of wine, beer, and/or hard liquor) and having fifty percent or more of total dollar sales accounted for by beverages covered under the off- sale general license. (78)Reserved. (79)Reserved. (80)Reserved. (81)"Loading space" means an area used for loading or unloading of goods from a vehicle in connection with the use of the site on which such space is located. (82) "Lodging" means the furnishing of rooms or groups of rooms within a dwelling unit or an accessory building to persons other than members of the family residing in said dwelling unit, or in the case of an accessory building, a dwelling unit on the same site, for overnight occupancy on a residential occupancy basis, whether or not meals are provided to such persons. Lodging shall be subject to the residential density requirements of the district in which the use is located. (83) "Lodging unit" means a room or group of rooms not including a kitchen, used or intended for use by overnight occupants as a single unit, whether located in a hotel or a dwelling unit providing lodging. Where designed or used for occupancy by more than two persons, each two-person capacity shall be deemed a separate lodging unit. For the purpose of determining residential density, each two lodging units shall be considered the equivalent of one dwelling unit. (84) ".Lot" or "site" means a parcel of land consisting of a single lot of record, used or intended for use under the regulations of this title as one site for a use or group of uses. * (A) "Comer lot" means a lot abutting two or more streets having an angle of intersection of one hundred thirty-five degrees or less. A lot abutting on a curved street or streets shall be considered a comer lot if straight lines drawn from the intersections of the side lot lines with the street lines to the midpoint of the street frontage meet at an interior angle of one hundred thirty-five degrees or less. 9.30.02.F!NAL SOFA CAP P&TC Version.doc 91 October 01 onno Appendix C-2 PAMC Chapter 18.04 - Definitions (85) "Lot area" means the area of a lot measured horizontally between bounding lot lines, but excluding any portion of a flag lot providing access to a street and lying between a front lot line and the street, and excluding any portion of a lot within the lines of any natural watercourse, fiver, stream, creek, waterway, channel, or flood control or drainage easement and excluding any portion of a lot within a street right-of-way whether acquired in fee, easement, or otherwise. (86)"Lot coverage" encompasses the following definitions: (A)"Single-family residential use" means the total land area within a site that is covered by buildings, including all projections except the exterior or outermost 1.2 meters (four feet) of any cave or roof overhang, but excluding ground level paving, landscaping features, and open recreational facilities. (B) "All other uses except single-family residential" means the total land area within a site that is covered by buildings, excluding all projections, ground level paving, landscaping features, and open recreational facilities. (C) Except in the CD District and areas designated as special study areas, the director of planning and community environment may permit minor additions of floor area to facilities that exceed lot coverage limits, for purposes of resource conservation or code compliance, upon the determination that such minor additions will increase site compliance with environmental health and safety standards. Such additions may include, but not be limited to, the following: (i) Area designed for resource conservation, such as trash compactors, recycling and thermal storage facilities; (ii) Area designed and required for hazardous materials storage facilities, handicapped access and seismic upgrades. (D) In commercial and industrial districts except in the CD Distric~ and in areas designated as special study areas, the director of planning and community environment may permit additions of floor area that exceed lot coverage limits upon the determination that such additions are designed and used solely for providing on-site employee amenities for employees of the facility and will facilitate the reduction of employee vehicle use. Such additions may include, but not be limited to, recreational facilities, credit unions, cafeterias and day care facilities. * (87) "Lot depth" means the horizontal distance from the midpoint of the front lot line to the midpoint of the rear lot line, or to the most distant point on any other lot line where there is no rear lot line. (88) Reserved. Appendix C-2 PAMC Chapter 18.04 - Definitions (89)Reserved. (90)Reserved. (91)"Lot line" means any boundary of a lot. * (A) "Front lot line" means, on an interior lot, the lot line abutting a street, or, on a comer lot, the shorter lot line abutting a street, or, on a through lot, the lot line abutting the street providing the primary access to the lot, or, on a flag lot, the interior lot line most parallel to and nearest the street from which access is obtained. (92) "Lot of record" means a lot which is part of a subdivision recorded in the office of the county recorder, or a lot or parcel described by metes and bounds which has been so recorded. * (93) "Lot width" means the horizontal distance between side lot lines, measured at the required front setback line. (94) "Manufacturing" means a use engaged in the manufacture, predominantly from previously prepared materials, of finished products or parts, including processing, fabrication, assembly, treatment, and packaging of such products, and incidental storage, sales, and distribution of such products, but excluding basic industrial processing of extracted or raw materials, processes utilizing inflammable or explosive materials (i.e., materials which ignite easily under normal manufacturing conditions), and processes which create hazardous or commonly recognized offensive conditions. (95) "Medical office" means a use providing consultation, diagnosis, therapeutic, preventive, or corrective personal treatment services by doctor, dentists, medical and dental laboratories, and similar practitioners of medical and healing arts for humans, licensed for such practice by the state of California and including services related to medical research, testing and analysis but excluding use of hazardous materials in excess of allowances contained in Title 17 of this code. 9.30.02.F!NAL SOFA CAP PR, T~. Version.doc 93 Appendix C-2 PAMC Chapter 18.04 - Definitions (96) "Mobile home (manufactured housing)" means a structure, transportable in one or more sections, which is built on a permanent chassis and designed to be used as a dwelling with or without a permanent foundation when connected to the required utilities, and including the plumbing, heating, air-conditioning, and electrical systems contained therein. (97) "Mobile home park" means a residential facility arranged or equipped for the accommodation of two or more mobile homes, with spaces for such mobile homes available for rent, lease, or purchase, and providing utility services and other facilities either separately or in common to mobile home spaces therein. (98)Reserved. (99)Reserved.- (100)Reserved. (101)"Motel" is defined in subsection (73). (102)"Multiple-family use" means the use of a site for three or more dwelling units, which may bein the same building or in separate buildings on the same site. (102.5)"Neighborhood business service" means a use occupying two thousand five hundred square feet or less, which is engaged in salesl servicing, installation and repair service, excluding vehicular repair and service, which does not generate noise, fumes or truck traffic greater than that normally associated with neighborhood-serving uses, or the performance of activities and services of the general nature described in this section. Such uses may include, but not be limited to, reproduction and copying, catering, cleaning, laundry services, home repair and remodeling supplies and sales, cabinetry and furniture repair. (103) "Neighborhood recreational center" means a privately owned or operated use providing, primarily for residents of the surrounding area, facilities for recreational or cultural activities, including lessons and instructions incidental thereto. (104) "Net floor area" means the net enclosed floor area used or capable of use for any activity, excluding walls, stairways, elevator shafts, service and mechanical equipment rooms, corridors or halls providing common access to more than one use, and unenclosed porches or balconies. (105) "Open" means a space on the ground or on the roofofa structure, uncovered and unenclosed. (106) "Opposite," as used with respect to relative location of two sites, means property whicli is separated less than 30.5 meters (one hundred feet) by a street, alley, creek, drainageway, or other separately owned right-of-way, and which would be considered abutting based on projection of side lot lines to the centerline of such separating right-of-way. (107) "Outdoor recreation service" means a privately owned or operated use providing facilities for outdoor recreation activities, including golf, tennis, swimming, riding, or other, outdoor sport or recreation, operated predominantly in the open, except for accessory or incidental enclosed services or facilities. (108) Reserved. (109) Reserved. Appendix C-2 PAMC Chapter 18.04 - Definitions (110) "Parking as a principal Use" means a use providing parking and storage of motor vehicles on a profit or nonprofit basis, as a principal use and not accessory to a permitted or conditional use. (111) "Parking facility" means an area on a lot or within a building, or both, including one or more parldng spaces, together with driveways, aisles, turning and maneuvering areas, clearances, and similar features, and meeting the requirements established by this title. "Parking facility" includes parking lots, garages, and parking structures. (A) "Temporary parking facility" means parking lots which are not required under this chapter and which are intended as interim improvements of property subject to removal at a later date. (112) "Parking space" means an area on a lot or within a building used or intended for use for parking of a motor vehicle, having permanent means of access to and from a public street or alley independently of any other parking space, and located in a parking facility meeting the requirements established by this title. "Parking. space" is equivalent to the term "parking stall" and does not include driveways, aisles, or other features comprising a parking facility as defined in this chapter. (113) "Patio cover,’ is defined in subsection (24), Canopy. (114) "Personal service" means a use providing services of a personal convenience nature, and cleaning, repair or sales incidental thereto, including: (A)Beauty shops and barbershops; (B)Shoe repair; (C)Self-service laundry and cleaning services; laundry and cleaning pick-up stations where all cleaning or servicing for the particular station is done elsewhere; and laundry and cleaning stations where the cleaning or servicing for the particular station is done on site, utilizing equipment meeting any applicable Bay Area Air Quality Management District requirements, so long as no cleaning for any other station is done on the same site, provided that the amount of hazardous materials stored does not at any time exceed the threshold which would require a permit under Title 17 (Hazardous Materials Storage) of this code; (D)Repair and fitting of clothes and personal accessories; (E)Quick priuting services where printing for the particular service is done on site, so long as no quick printing for any other printing service is done on the same site; (F) Copying services; (G) Film processing shops, including shops where development processing for the particular shop is done on site, so long as no development processing for any other shop is done on the same site; (H)Art, dance or music studios. (115)"Private educational facility" means a privately owned school, including schools owned and operated by religious organizations, offering instruction in the several branches of learning and study required to be taught in the public schools by the Education Code of the State of California. (116) "Professional office" means a use providing professional or consulting services in the fields of law, architecture, design, engineering, accounting, and similar Appendix C-2 PAMC Chapter 18.04 - Definitions professions, including associated product testing and prototype development, but excluding product manufacturing or assembly and excluding use of hazardous materials in excess of the allowances contained in Title 17 of this code. (117) "Projection" means architectural elements, not part of the main building support, that cantilever from a single building wall or roof, involving no supports to the ground other than the one building wall from which the element projects. (118) "Property" means real property which includes the land, that which is affixed to the land, and that which is incidental or appurtenant to the land, as defined in Civil Code Sections 658 - 662. (119) "Queue line" means an area for parking and lining of motor vehicles while awaiting a service or other activity. (120) "Recreational vehicle" means a vehicle towed or self-propelled on its own chassis or attached to the chassis of another vehicle and designed or used for temporary dwelling, recreational or sporting purposes. The term "recreational vehicle" includes, but is not limited to, travel trailers, pickup campers, camping trailers, motor coach homes, converted trucks and buses and boats and boat trailers. (121) "Recycling center" means facilities appurtenant and exterior to an otherwise allowed use, which are utilized for collection of recyclable materials such as metal, glass, plastic, and paper stored in mobile vehicles or trailers, permanent storage units, or in bulk reverse vending machines exceeding fifty cubic feet in size. (122) "Religious institution" means a seminary, retreat, monastery, conference center, or similar use for the conduct of religious activities, including accessory housing incidental thereto, but excluding a private educational facility. Any such use for which a property tax exemption has been obtained pursuant to Section 3(f) of Article XIII of the Constitution of the State of California, and Section 206 of the Revenue and Taxation Code of the State of California. or successor legislation, or which is used in connection with any church which has received such an exemption, shall be prima facie presumed to be a religious institution. (123) "Research and development" means a use engaged in study, testing, design, analysis, and experimental development of products, processes, or services, including incidental manufacturing of products or provisions of services to others. (124) Residential care home" means use of a dwelling unit or portion thereof licensed by the state of California or county of Santa Clara, for care of up to six persons, including overnight occupancy or care for extended time periods, and including all uses defined in Sections 5115 and 5116 of the California Welfare and Institutions Code, or successor legislation. (125) "Retai.1 service" means a use engaged in providing retail sale, rental, service, processing, or repair of items primarily intended for consumer or household use, including but not limited to the following: groceries, meat, vegetables, dairy products, baked goods, candy, and other food products; liquor and bottled goods, household cleaning and maintenance products; drugs, cards, and stationery, notions, books, tobacco products, cosmetics, and specialty items; flowers, plants, hobby materials, toys, household pets and supplies, and handcrafted items; apparel, jewelry, fabrics, and like items; cameras, photography services, household electronic equipment, records, sporting 9.30.02.FhNAL SOFA CAP P&TC Version.doc 96 October 01,2002 Appendix C-2 PAMC Chapter 18.04 - Definitions equipment, kitchen utensils, home furnishing and appliances, art supplies and framing, arts and antiques, paint and wallpaper, carpeting and floor covering, interior decorating services, office supplies, musical instruments, hardware and homeware, and garden supplies; bicycles; mopeds and automotive parts and accessories (excluding service and installation); cookie shops, ice cream stores and delicatessens. (A) "Extensive retail service," as used with respect to parldng requirements, means a retail sales use having more than seventy-five percent of the gross floor area used for display, sales, and related storage of bulky commodities, including household furniture and appliances, lumber and building materials, carpeting and floor covering, air conditioning and heating equipment, and similar goods, which uses have demonstrably low parking demand generation per square foot of gross floor area. (B) "Intensive retail service" as used with respect to parldng requirements, means any retail service use not defined as extensive retail service. (126) "Reverse vending machine" means a mechanical device which accepts one or more types of empty beverage containers and issues a cash refund or credit slip. * (127) "Screened" means shielded, concealed and effectively hidden from view at an elevation up to 2.4 meters (eight feet) above ground level on adjoining sites, or from adjoining streets, within 3.0 meters (ten feet) of the lot line, by a fence, wall, hedge, berm, or similar structure, architectural or landscape feature, or combination thereof. (128) "Setback line" means a line within a lot parallel to a corresponding lot line, which is the boundary of any specified front, side or rear yard, or the boundary of any public right-of-way whether acquired in fee, easement, or otherwise, or a line otherwise established to govern the location of buildings, structures, or uses. Where no minimum front, side or rear yards are specified, the setback line shall be coterminous with the corresponding lot line. (See Chapter 20.08 of the Palo Alto Municipal Code for setback map regulations.) (129) Reserved. (130) Reserved. (131) "Shopping center" means a group of commercial establishments, planned, developed, owned, or managed as a unit, with off-street parldng provided on the site, and having a total gross floor area of not less than 92,903 square meters (one million square feet) and a total site area of not less than 20.3 hectares (fifty acres). (132)"Single-family use" means the use of a site for only one dwelling unit. (133)"Site" is defined in subsection (84). (134)"Structure" means that which is built or constructed, an edifice or building of any kind, or any piece of work artificially built up or composed of parts joined together in some definite manner. (For further provisions, see the definition for "facility," subsection (53).) (135) "Studio dwelling unit, efficiency dwelling unit" means a dwelling unit consisting of a single habitable room for living and sleeping purposes, plus ancillary kitchen and bath facilities. 9.30.02.FINAL SOFA CAP P&TC Version.doc 97 October 0!,2002 Appendix C-2 PAMC Chapter 18.04 - Definitions (136) "Take-out service" means a characteristic of an eating or drinking service which encourages, on a regular basis, consumption of food or beverages, such as prepared or prepackaged items, outside of a building, in outdoor seating areas where regular table service is not provided, in vehicles parked on the premises, or off-site. (137) "Transportation terminal" means a depot, terminal, or transfer facility for passenger transportation services. (138) Reserved. (139) Reserved. (140) Reserved. (141) "Two-family use" means the use of a site for two dwelling units, which may be within the same building or separate buildings. (142) "Usable open space" means outdoor or unenclosed area on the ground, or on a roof, balcony, deck, porch, patio or terrace, designed and accessible for outdoor living, recreation, pedestrian access, landscaping or any required front or street side yard, but excluding parking facilities, driveways, utility or service areas. (143) "Use" means the conduct of an activity, or the performance of a function or operation on a site or in a building or facility. (A) "Accessory use" means a use which is incidental to, and customarily associated with a specified principal use, and which meets the applicable conditions set forth in Chapter 18.88. (B) "Nonconforming use" means a use which is not a permitted use or conditional use authorized within the district in which it is located, but which was lawfully existing on July 20, 1978, or the date of any amendments hereto, or the application of any district to the property involved, by reason of which adoption or application the use became nonconforming. (For further provisions, see the definition of "noncomplying facility!’ in subsection (53).) (C) "Principal use" means a use which fulfills a primary function of a household, establishment, institution, or other entity. (D) "Permitted use" means a use listed by the regulations of any particular district as a permitted use within that district, and permitted therein as a matter of right when conducted in accord with the regulations established by this title. (E) "Conditional use" means a use, listed by the regulations of any particular district as a conditional use within that district and allowable therein, solely on a discretionary and conditional basis, subject to issuance of a conditional use permit, and to all other regulations established by this title. (F)"Change of use" is defined in subsection (26). (144)"Warehousing" and "distribution" means a use engaged in storage, wholesale, and distribution of manufactured products, supplies, and equipment, but excluding bulk storage of materials which are inflammable or explosive or which create hazardous or commonly recognized offensive conditions. * (145) "Watercourse bank" means the side of a watercourse the top of which shall be the topographic line roughly parallel to stream centerline where the side slopes intersect the plane of the ground traversed by the watercourse. Where banks do not ......................................... b~r 01 ,~0,~ Appendix C-2 PAMC Chapter 18.04 - Definitions distinguishably end, the surrounding country being an extension of the banks, the top of such banks shall be defined as determined by the building official. (146) "Yard" means an area within a lot, adjoining a lot line, and measured horizontally, and perpendicular to the lot line for a specified distance, open and unobstructed except for activities and facilities allowed therein by this title. * (A) "Front yard" means a yard measured into a lot from the front lot line, extending the full width of the lot between side lot lines intersecting the front lot line. (147) "Youth club" means a recreational use, operated on a profit or nonprofit basis, for supervised youth involving dancing or social gathering as a principal activity but prohibiting sate or consumption of alcoholic beverages. (Ord. 4642 §§ 32, 33, 2000: Ord. 4472 § 2, 1998: Ord. 4140 §§ 2, 3, 4, 1993: Ord. 4081 § 4, 1992: Ord. 4043 § 1, 1991: Ord. 4016 §§ 2-6, 1991: Ord. 3905 §§ 2, 3, 4, 1989: Ord. 3896 §§ 1,2, 3, 1989: Ord. 3890 § 1, 1989: Ord. 3850 § 5, 1989: Ord. 3807 § 16, 1988: Ord. 3783 § 1,1987: Ord. 3757 §§ 1 - 4, 1987: Ord. 3735 §§ 1, 23, 24, 1987; Ord. 3703 §§ 1 - 5, 9, 1986: Ord. 3683 § 1, 1986: Ord. 3632 §§ 1, 2, 1985: Ord. 3584 § 1, 1984: Ord. 3583 §§ 27- 28, 1984: Ord. 3536 §§ 1, 2, 27- 30, 1984: Ord. 3465 §§ 29, 30, 1983: Ord. 3349 § 1, 1982: Ord. 3345 §§ 1, 5, 9, 10, 11, 19, 20, 1982: Ord. 3340 §§ 1, 2, 6, 7, 1982: Ord. 3291 § 1, 1981: Ord. 3255 §§ 1 and 3, 1981: Ord. 3187 §§ 7, 8, 9, 10, 1980: Ord. 3130 §§ 1 (part), 15 (part), 23, 25 (part), 1979: Ord. 3108 §§ 3, 13, 14, 16, 1979: Ord. 3103 § 1, 1979; Ord. 3064 § 1 (part), 1978: Ord. 3048 (part), 1978) APPENDIX D Street Name Forest Avenue Homer Avenue Charming Avenue Addison Avenue Alma To High Fraxinus (species t.b.d) Fraxinus (species t.b.d.) Acer capillipes Celtis australis High to Emerson Acer (species t.b.d.) Celtis australis Cercis canadensis Ginkgo biloba ’Autumn Gold’ Emerson to Ramona Fraxinus (species t.b.d.) Fraxinus (species t.b.d.) Acer Capillipes Celtis australis Street Name Alma Street High Street Emerson Street Ramona Street Forest to Homer Fraxinus (species t.b,d.) Pistacia chinensis Cercis Canadensis Lagerstroemia indica. ’Natchez’ (white) or ’Cherokee’ (red) Homer to Channing Fraxinus (species t.b.d.) Acer (species t.b.d.) Acer (species t.b.d.) Lagerstroemia indica ’Natchez’ (white) or ’Cherokee’ (red) Channing to Addison Fraxinus (species t.b.d.) Pistacia chinensis Cercis Canadensis Lagerstroemia indica ’Natchez’ (white) or ’Cherokee’ (red) APPENDIX E MEMORANDUM TO:Lisa Grote, City of Paio Alto FROM:Alexander Quinn, Senior Associate Matt Kowta, Principal RE: SOFA II Economic Analysis - Draft Findings DATE: June 20, 2002 The purpose of this memorandum is to provide the analysis, findings, and conclusions regarding an Economic Analysis conducted for the preparation of Phase II. of the South of Forest (SOFA) Coor~linated Area P!an. Study Objective The City of Palo Alto retained BAE to evaluate the economic viability of proposed zoning amendments in the South of Forest Area (SOFA) Coordinated Area Plan, Phase II. This study has been prepared in response to a portion of the Coordinated Area Plan ordinance (No. 4454), which calls for planning efforts to include an analysis of economic conditions so that development plans work within the context of existing market conditions. The zoning alternatives include an option for a 1.15 Floor Area Ratio (FAR) maximum recolmnended by the SOFA Coordinated Area Plan Working Group, an alternative specifying a 1.5 FAR maximum, proposed by City staff, and a third 2.5 FAR alternative that was defined for the purposes of this analysis, to bracket the high end of potential SOFA Phase II area density. In addition, BAE evaluated the existing zoning (0.6 FAR) as a baseline condition. For each of these zoning alternatives, the urban design finn of Freedman, Tung & Bottomley (FTB) developed a series of illustrative development prototypes that served as the basis for BAE’s financial analysis. FTB created a development prototype for each FAR level for both a small and large site. For each of the different prototypes, BAE estimated the resulting residual land value. For the small site, BAE assmned a 10,500 square foot corner lot on Ahna Street with approximately 9,800 auto-related building square. The large site was modeled after the small corner lot site plus the adjacent City owned parcel at 841 Alma Street, which currently is the site for a City electric utility substation. The small site and the City parcel combined provide 26,250 square feet of site area. Finally, BAE analyzed each development prototype assuming reduced parking requirements, in addition to standard parking requirements. In addition to analyzing the economics associated with the different density regulations, the City of Palo Alto also requested that BAE evaluate the economic viability of restrictions on ground floor office uses in certain portions of the SOFA II area. Specifically, the Working Group proposal would Iimit ground floor office to 2,500 square feet on any single parcel, with a maximum.of 5,000 total square feet of office, including upper floor office spaces. The Working Group proposal would also prohibit ground floor office, including medical and professional Sacramento Region Office 530,750.2195 740 G Street 539.750.2194 Davis, CA 956516 bayareaeconomics.com Headquarters 510.549.7310 along Emerson Street and Homer Avenue and general business and office on ground floor south of Homer except Ahna Street. BAE evaluated the general demand for retail space within the SOFA Phase II area and the viability of retail uses within specific corridors ofthe SOFA Phase II area. Study Approach As background for the economic analysis, BAE researched existing market .conditions for office, re.tail, rental residential, and for-sal~ condominiums within the vicinity of SOFA. The market information provided BAE with an esthnate of th& current balance of supply and demand for these land uses as well as for the revenue potential thatmight be associated with flew development. BAE also coliected development cost and operating cost inputs from local developers, lenders, contractors, and insurers. Using the findings from the market research and these additional inputs, ]3AE created a pro-fonr~a analysis for each development prototype. The pro-forma analyses estimate the residual land value or -irt other words- the value of the land remaining after accounting for th~ cost to develop each prototype. The residual land value represents the amount a developer would need to pay for a given piece of property upon which to build the specified development prototype, while allowing for a reasonable profit. After calculating the land residual value, BAE then evaluated the general economic feasibility of the various zon!ng alternatives for the small and large sites, consideringthe current economic value of the sites in their current condition. The resuit provides an analysis of the zoning alternatives and whether the alternatives offer sufficient economic incentive to land owners and developers to redevelop property within the area. For a development prototype for which BAE estimated that the residual land value is higher than the current economic value of the site, BAE deemed the zoning alternative to be economically feasible. In addition to our own market survey, BAE also reviewed the South of ’Forest Area - West Retail Market Study (Wallace & Steichen, Inc., June 2001) on the City’s behalf to assess the economic viability of restrictions on ground floor office uses m the SOFA II ~trea. Limiting Conditions The following limiting conditions apply to this memorandum and the BAE analysis conducted for the study: All development program assumptions for each scenario (e.g., number of residential units, parking square footage, etc.) were provided to BAE and are considered reliable Most of the assumptions used in the BAE financial analysis could change over time, depending on market and economic conditions. These assumptions include construction loan interest rates and loan-to-value ratios, development project revenue, construction costs, City fees and tax assessments, etc. Sacramento Region Office 740 G Street Davis, CA 956~16 Headquarters 530./50,2195 539.-/50.2194 fax bayareaeconomics.com 510,549.7310 The BAE analysis did not involve in-depth market analysis of future demand for retaill housing, or office space. The availability of on-street parking for new colmnercial space (e.g., office or retail) in the Pian area was not analyzed or considered in the BAE work. The BAE analysis did not include an assessment of any physical development constraints in the Plan area such as potential environmental contamination, easements, infrastructure capacity, etc. The BAE analysi@~d~alsolnot assess highest and best use for any particular parcel. Deveio pment Prototypes As discussed previously, BAE, FTB, and the City of Palo Alto’s Planning and Co~mnunity Environment Department created development prototypes for three zoning alternatives, each with a standard parking alternative and a reduced parking .alternatiye. In general, FTB created development prototypes that maximize4 the allowable floor area ratio by specifying large three bedroom-two bathroom residential units of approximately 1,500 square feet each, in addition to the allowable commercial building floor area. In certain cases~ FTB was unable to utilize th~ parcel to its fullest allowed FAR because the site could not fit the required parking. For example, FTB couId only fit i6 residentiai units with 58 parking spaces in the 1.5 FAR standard parking alternative on the large site but could fit 22 units and 52 parking spaces in the 1.5 FAR reduced parking alternative for the same large site (See Appendix O and Appendix P). The table on the next page summarizes the development prototypes BAE analyzed for the SOFA Phase II area. Appendix S provides a more detailed description of the type of construction and unit amenities assumed for each development prototype. Sacramento Region Office 740 G Street Davis, CA 956516 Headquarters 530.750.2195 539,750.2194fax bayareaeconomics.com 510.549.7310 Development Prototypes by Zoning and Parking Alternative Existing Zoning-.. 0.6 FAR 1.15 FAR Standard Parking 1.15 FAR Reduced Parking 1.5 FAR Standard Parking 1.5 FAR. Reduced Parking 2.5 FAR Standard Parking 2.5 FAR ¯ Reduced Parking Existing Zoning 0.6 FAR 1.15 FAR Standard Parking 1.15 FAR Reduced Parking Wood Frame, Apa~ments/Cotmnercial ~ood Frame, 3-Sto~ Condos Wood Frame, 3-Story Condos Wood Fram£, 3-Sto~ Condos Wood Frame, 3-Sto~ Condos Woid Frame, 3-Sto~ Condos Wood Frame, 3-Sto~ Condos Wood Frame, 2-Sto~ Apa~ments/Co~ercial Wood Frame, 3-Sto~ Condos/Co~mgercial 6,300 10,500 10,500 15,000 15,000 22,000 ’ 22,000 14,975 29,200 2 @ 1,400-Sq.Ft. each 7 @ 1,500 Sq.Ft. each 7 @ 1,500 8q.Ft. each 10 @ 1,500 Sq.~t. each 10 @ 1~500 Sq.Ft. eac~ i0 @ 1,500 Sq.Ft. each 15 @ 1,500 Sq.Ft. each 7 @ 1,425 Sq.Ft. each 16 @ 1,500 S.F. each Wood Frame, 3-Story Condos/Cmmnercial 29,200 16 @ 1,500 S.F. each 3,500 Office !.5 FAR Standard Parking 1.5 FAR Reduced Parking 2.5 FAR Standard Parking 2.5 FAR Reduced Parking Wood Frame, 3-Story Condos/Commercial Wood Frame, 3-Story Condos/Colm-nercial Wood Frame, 3-Story Condos/Commercial Wood Frame-Steel Joists, 4-Story Condos/Commercial 29,200 39,300 38,500 53,300 16 @ 1,500 S.F. each 22 @~1,500 S.F. each 20 @1,5oo S.F. each 33 @-1,400 S.F. each 5,000 Office 2,500 Office 2,700-Retail 2,500 Office 2,700 Reta.il 2,500 Office 2,700 Retail 2,500 Office 2,700 Retail 4,000 Office 3,000 Retail 2,800 Of Nce .-- 2,750 Retail 17 Podium 11 Podimn 23 Podimn 15 Podium 33 Undrgn~d 21 Undrgrnd. 36 Surface 4 Surface 15 Tuck Undr. 39 Podium 4 Surface 15 Tuck Undr. 24 Podium 4 Surface 15 Tuck Undr. 39 Podium 4 Surface 15 Tuck Undr. 33 Podium 29 Undrgrnd. 24 Podium 19 Surface 24 Undrgmd. ¯ 26 Podium 19 Surface Sacramento Region Office 740 G Street Daqis, CA 956516 Headquarters 530.750.2195 539.750.2194 fax bayareaeconomics.com 510.549.7310 Current SOFA Area Real Estate Market Conditions BAE conducted a survey of currently leasing/for sale residential, retail, and office properties in the vicinity of SOFA. BAE surveyed approximately 60properties. The results of the survey are shown in Appendices A, B, C, and D. BAE also reviewed recent p~operty transactions for vacant land and condominimn sales within Palo Alto. Base~t on these surveys, BAE has utilized the rental rate/sales price assumptions shown in the following matrixl summaries of which are provided below. For-Sale Condominiums BAE" located 18 condominiums for sale within the vicinity of SOFA. The properties varied in price and size but averaged $534 per square foot. Excluding an adult living unit (persons 55 years and above) with an available pool and spa and asking price of $811 per square foot, the average asking sales price was $517 per square foot. BAE also reviewed condominium sales within the downtown zip code (94301) over the last 12 months. BAE located 30 condominium sales that averaged approximately $460 per square foot with an average building age of 30 years. Based on these comparables, a .conservative estimate for a new condominium project with reduced parking (1.5 per unit) is $500 per square foot, while a new condolninium project with standard parking (2.3 per unit) could conservatively obtain $515 per square foot in the SOFA Phase II area. Rental Residetttial BAE obtained rental information for 13 properties within vicinity of SOFA. Rental rates varied from a low of $1.43 per square foot to a high of $2.78 per square foot. Overall, the average per square foot rental rate was $1.81. BAE also reviewed RealFacts data, which maintains multifamily housing smnmary information on 13 projects in Palo Alto. In March.2002, three bedroom-two bath units within the 13 projects averaged $1.88 per square foot. New three bedroom-two bathroom rental units would likely generate more than the average per square foot rental rate, but the actual rental rate would clearly be contingent upon unit and building amenities. Office BAE obtained leasing infon-nation on 23 office properties wi}hin the vicinity of SOFA. In total, BAE found approximately. 115,000 square feet of vacant office space within the area with a median lease rate of $3.75 per square foot, !riple net (NNN). The spaces var!ed in size.and type, with vacant Class A office space asking from $2.00 to $4.50 per square foot, NNN. Based on the comparables, a new office space of the type envisioned in the development prototypes could conservatively generate approximately $3.50 per square foot, NNN. Retail BAE located three properties with available retail space within the vicinity of SOFA. The three spaces averaged approximately $4.00 per square foot with lease terms negotiable. BAE also contacted commercial brokers that work within SOFA to further understand the retail demand within SOFA. All of the brokers indicated there is a lack of parking within SOFA.which Sacramento Region Office 530.750.2195 740 G Street 539.-/50.2194 fax Davis, CA 9565.16 ba)’areaeconomics.com Headquarters 510.549.7310 reduces retait.opportunities. Brokers stated that SOFA will continue to struggle to compete with better parked and heavier auto and pedestrian traffic retail areas in downtown and eisewhere in Palo Alto. In addition, two colmltercial brokers .felt that downtown employee parking spilled over into SOFA further reducing the number of available parking spaces for SOFA retailers. The City recently estimated a downtown parking, shortfall of approximately 1,450 spaces. The City is currently constructing another 700 public parking spaces ~n the downtownl which will help..to alleviate parking press.ur.es in downtown and in surrounding ~ including SOFA. Pro-Forma Analysis The pro-forma analyses synthesize local market data, construction cost information, and operating expenses to estimate land residual values for. each development prototype. The Iand residual value is based on stabilized project occupancy, or -in the case of condominiums- project sell-out. It is important tO note that construction costs, operating expenses, and revenue potential can change in response to economic cycles and other macro and microeconomic conditions; however, BAE has based this analysis on existing conditions. Development Cost Assumptions Appendix S provides a detail of development costs by prototype. These costs are a synthesis, of infonltation from building contractors, developers, and BAE’s review of the 2002 RS Means Square Fo~t Cost manual.~ In general, BAE used conservative construction cost estimates and assumed high-quality construction and ample unit amenities. Parking costs are represented on a per square foot basis and were obtained through conversations with developers and contractors that work Within the Palo A!to region. Underground parking represents the most expensive parldng type, priced at $75 per square foot. Underground parking on smaller parcels (e.g. a small 10,500 square foot lot) becomes quite expensive due to a lack of parldng efficiencies (e.g., a major portion of the undergroimdparking. area is dedicated to the ramp). BAE estimated the cost of building underground parldng on the small site at over $3~,000 per space. ~ RS Means, Square Foot Costs, 23ra Addition, 2002. The RS Means manual provides national constmcti0n cost data for a broad range of development types. The RS Means manual includes construction cost multipliers for Palo Alto. Sacramento Region Office 530.750.2195¯"740 G Street 539.750.2194 fax Davis, CA 956516 bayareaeconomics.com Headquarters 510.549.7310 The following table summarizes the construction cost assumptions by land use and site size: Mixed-Use Apartments / Colmnercial - Condominiums Mixed-Use Condominiums/ Co~mnercial .Apamnents: $141 Cmmnercial: $156 Small Proj ect: $160 Larger Project: $150 Condoruiniums: $140-$150 Commercial: $150- $160 Surface: $8 Surface: $8 Podium: $4,5 Underground.: $70-$75 Surface: $8 Tuck-Under: $30 Podium: $45 Underground: $70 $17,000 - $18,000/unit excld. BMR costs $13-$261 Bldg. Sq. Ft. excld. BMR costs Rate 7.5% LTV 0.75 Points: 1.5% Drawdown: 0.55 Rate 7.5% LTV 0.75 Points: 1.5% Drawdown: 0.55-0.60 Rate 7.5% LTV 0.75 Points: 1.5%-2.0% Drawdown: 0.55-&65 Developer _Profit. BAE contacted a number of local lenders to obtain construction lending criteria within Palo Atto. Overall, BAE found that lenders look favorably upon projects within the City of Palo Alto and assign lower underwriting criteria compared to the Bay Area overall. Capitalization rates are generally lower in Palo Alto than in neighboring cities. Nonetheless, lenders stated that commercial projects in general, and office projects specifically, are deemed to involve more risk than residential projects in today’s economic climate. To offset the higher risk, lenders require higher developer profit margins. In this analysis, BAE assumed a strictly residential project would require a 10 percent return on total costs minus financing costs, while a mixed-use project would require a 12 percent return on total costs minus financing costs. DefectLiabililylnsurancefor Ownership ResidentialProjects. BAE contacted local insurers to obtain cost information on wrap insurance policies that protect developers and their contractors from construction defect .claims .(particularly for condominium construction). While BAE located two insurance brokers that provided insurance cost estimates, both brokers indicated that the short-term future of wrap insurance policies is uncertain. The brokers stated that the stagnant stock market combined with September 11, 2001 severely damaged the insurance industry. Compounding the problem is the prevalence of construction defect claims within California on condominiurn projects. As a result, insurers have been more hesitant to offer higher risk insurance policies, including wrap insurance policies. Currently, wrap insurance policies are estimated at $420,000 for coverage capped at a maximum of $3,000,000 without the ability to augment the amount of coverage. Insurance brokers and developers stated that wrap insurance poIicies may disappear altogether. The result would be a near standstill in condominium construction throughout California, including Palo Mto. 12% 10% 12% Sacramento Region Office 740 G Street Davis, CA 956516 Headquarters 530.750.2195 539.750.2194 ~x bayareaeconomics.com 510.549.7310 BAE’s analysis assmnes a developer would be able to obtain defect liability insurance. If this insurance were not available, redevelopment feasibility would be reduced because multifamiIy rental units do not generate similar values compared to condominimn values. As an example, a 1,500 square foot rental unit in SOFA would generate approximately $22,000 in net revenue a year2. Based on local capitalization rates, the apartment could sell for approximately $318,000.3 A comparable condominium with similar unit amenities could sell in Palo Alto for approxhnate.ly $750,000, which is more than twice the value of the rental unit. Operating Costs Assumptions BAE calculated operating expenses for retail and office space assuming a triple net lease arrangement, under which the property owner passes most of the property operating expenses on to tenants. The property owner’s assumed monthly management and property maintenance expense rate is $0.35 per office square foot and $0.33 per square foot for retail. The estimated apartment operating expense rate is 30 percent of gross potential rent for the small two unit apartments presented in Appendix E, due to a lack of economies of scale, and 25 percent of gross potential rent for the seven unit mixed-use project presented in Appendix L.4 Revenue After reviewing existing market lease rates within SOFA, BAE developed revenue assumptions for office, retail, apartment, and condominium uses. The following matrix provides a summary of the revenue and operating expense assumptions: :Land"USe Dei@ipfi0ffl Office Retail Very small scale multifamily project (2-unit mixed use project) Small ¯scale multifamily project (7-unit mixed use project) Condominium - Standard Parking Condominium - Reduced Parking $3.50 - $3.25 $1.90 $1.95 - Expends/Sq.Ft.. $0.35/Month $0.33/Month 30% of Gross Rent 25% of Gross Rent Not applicable Not applicable 5% 5% Marketing and Brokerage Fee 5% Marketing and Brokerage Fee $515 (sales pfice) $500 .(salesprice) 8% Not applicable Not applicable 2 Assumes a three bedroom-two bath unit could garner $2,850 per month with an annual expense rate of 30 percent of gross potential revenue. 3 Assumes a capitalization rate ofT.0 percent. 4 Dollars and Cents. of Multifamily Housing, National Apartment Association, Urban Land Institute, 2000. Local multifamily housing developers, 2002; U.S. Bank, 2002; Mid-Peninsula Bank, 2002. Sacramento Regidn Office 530.750.2195 740 G Street 539.750.2194 fax Davis, CA 956516 bayareaeconomics.~om Headquarters 510.549.7310 Redevelopment h~centive Thresholds As part of the economic feasibility analysis, BAE evaluated the financial refums that would encourage landowners to redevelop his or her parcels. Specifically, BAE analyzed the existing economic value of the small site with 9,800 square building auto-related service and added demolition costs and redevelopment profit to estimate the price that a developer would need to be able to pay the property in order to make it financially attractive for the owner to sell the property rather than continue with the current economic use of the property. The analysis assumes that the small site owner will continue to operate its building as is without renovating or redeveloping the site if its existing economic value exceeds what a developer could afford to pay in order to acquire the site for a given developmen.t prototype. BAE determined the building’s economic value by assmning the building is leased to a separate auto repair business in its current condition. As shown in Table 1, at an assumed lease rate of $1.85 per square foot (NNN), a monthly management e~pense of $0.19 per square foot, vacancy of 10 percent, and a capitalization rate of eight pgrcent, the 9,800 square foot auto service building has an economic or capitalized value of $2,175,600. q3AE then added $10 per building square foot demolition costs and 10 percent redevelopr~e~k.profit resulting in a land residual, goal of $2,49t,160 or $237 per lot square foot. This is t-ke"q,stimated financialincentive necessary to redevelop the small site, ~ ~ BAE also anaty~ed the necessary finaneial "incentiVe to make it worthwhile for the City of Palo Alto to augment or upgrade an existing electric substations that could replace the electric capacity currently provided by the City’s substation at 841 Alma. According to the City’s Utilities Dep.ilrtment, a[ough~.e, stimate ’of replacement costs is one million dollars. Adding redevelopment profit of 10 percent results in a land r~sidual goal of $1.1 million or approximately $70 per lot square foot. Therefore, the combined land residual value goal is $1.1 million plus $2.49 million results in a combined site land residual value goal of approximately $3.59 million. While the economic value for the substation is substantially lower than small site’s economic value on a per lot square foot basis, the substation site’s land residual value as a vacant property would be approx!mately $53 per square foot based on existing zoning standards.’ The small site is assumed to contain an existing building -on the other hand- that exceeds existing zoning standards and does not require new construction to generate economic value. ~ Based on a floor area ratio of 0.6 with a maximum office square footage of 5,000 square feet. Assumes 5,000 square feet of office with four 1,100 square foot rental units. Sacramento Region Office 530.750.2195 740 G Street 539.750.2194 fax Davis, CA 956516 bayareaeconomics.com Headquarters 510,549.7310 Table 1 : Economic Value and Redevelopment Feasibility Thresholds Small Site - Auto-Related Service Lot Size Auto-Related Service Building Size- Estimated Lease Rate As Is (NNN) Monthly Lease Revenue Less Vacancy (-10%) Estimated Expense Rate Monthly Expenses Total Monthly Revenue 10,500 LotSq. Ft. 9,800 Bldg. Sq. Ft. $1.85 /Bldg. Sq.Ft. $18,130 /Month ($1,8t3) /Month ($0.19) /Bldg. Sq.Ft. ($1,813) /Month $14,504 Annual Revenue Capitalization Rate Building Capitalized Value $174,048 /Year 8% $2,175,600 Total Site Value Demolition Costs Redevelopment Profit Total Land Residual Goal Total Land Residual Goal/Sq Ft. $2,175,600 $98,O0O 10% $2,491,160 $237:25 @$10/Bldg; Sq. Ft. of Site Value /Lot Sq.Ft. 841 Alma, City Utility Substation Lot .Size Estimated cost to remove substation and upgrade other to maintain capacity Total Site Value Redevelopment Profit Total Land Residual Goal Total Land Residual Goal/Sq Ft. 15,750 Lot Sq. Ft. $t,o00,000 $1,000,000 10% of Site Value $1,100 000 $69.84 /Lot Sq,Ft. Small Site Land Residual Goal $2,491,160 1ITotal Land Residual Goal/Sq Ft.$237.28 /Lot Sq.Ft. I Combined Site Land Residual Goal $3,591,160 Tota Land Residual Goal/Sq Ft.$136.81 /Lot Sq.Ft. Sources: City of Palo Alto, Planning and Community Environment Department, 2002; BAE, 2002. Development Feasibility Results BAE compared the land residual values for each development prototypes to the economic or capitalized value of the small site and the small site and the City substation’s combined large site discussed in the p~evious section. These resuIts are smmnarized dn the next page. Overall, the reduced parking alternative adds to the efficiency of the site but only provides marginally higher returns where a site can physically accolmnodate the higher parking requirements without reducing the building intensity. Existing zoning standards do not provide sufficient economic incentive to landowners to redevelop their property. Owners of smaller parceIs have more barriers towards redevelopment than larger sites because the larger sites offer better econ’omies of scale and improved site parking efficiencies. Redevelopment potential for sites that do not have sufficient size to build underground or partially submerged pod{urn parking would be severely limited under the standard parking requirements. In addition, a City policy that restricted parcel consolidation would reduce redevelopment feasibility due to a loss of economies of scale and reduction in site efficiencies. Smafl Site Redevelopment Opportunities Existing market conditions would not provide sufficient incentive to redevelop a small site (approximately 12,000 square feet or less) under a 1.15 FAR alternative. Based on BAE’s economic analysis, the 1.5 FAR alternative would provide sufficient incentive to redevelop the small site with a marginal increase of one percent to. the project value. While a 1.5 FAR parking alternative provides redevelopment incentive for smaller sites, redevelopment would likely result in condominiumprojects and not mixed-use projects because of the higher parking requirements for office and retail uses. Due to the marginal feasibility of the small site, a 1.5 FAR zoning alternative may have difficulty providing a local public benefit (e.g. open space, available public parking, etc.), which would be necessary to apply for the 1.5 FAR without eliminating the site’s economic feasibility. .The 2.5 FAR low parking requirement would generate the highest land residual value at $3.1 million. Using the land residual goal model discussed earlier, BAE can give a rough estimate of development feasibility for small redevelopment projects in general. If BAE assumed a similar sized parcel with an 8,000 square foot building averaging $2.00 per square foot (NNN) a month, the 1.5 FAR alternative with standard parking would provide sufficient incentive for site redevelopment. Simultaneously, if BAE assumed a 9,000 square foot building on the same parcel and $2.50 per square foot lease rate redevelopment would only be economically feasible under a 2.5 FAR reduced parking alternative. Large Site Redevelopment Opportunities Due in part to the lower economic value of the substation and greater site efficiencies, the 1.15 FAR standard parking alternative would provide sufficient financial incentive for redeveloplnent. Similar to the small site, the standard parking aiternatives for the !.5 and 2.5 FAR alternatives would curtail the total building square feet regardless of the FAR limitations. If BAE applied the FAR alternatives to a similar sized underutilized parcel (26,250 lot square feet), containing a 15,000 square foot building that generated $2.00 per square foot in revenue, a 1.15 FAR standard parking would offer sufficient incentive to the property to redevelop his or Sacramento Region Office 740 G Street Davis, CA 956516 Headquarters 530.750.2195 539.750.2194fax bayareaeconomics.com 510.549.7310 her property. If the same building leased at $3.00 per square foot, a l.5 FAR reduced park~g alternative would provide sufficient economic incentive. Economic Feasibility Analysis Summary Existing Zoning $1,537,000 $1,9+9,000 $452,000 Not feasible 0.6 FAR 1.15 FAR Standard Parking !.15 FAR P~educed Parking. 1.5 FAR ¯ Standard Pa}k~g 1.5 FAR Reduced Parking 2.5 FAR Standard P ~king 2.5 FAR Reduced Parking Existing Zoning 0.6 FAR 1.15 FAR Standard Parking 1.15 FAR ¯ Reduced Parking 1.5 FAR Standard Park~g 1.5 FAR Reduced Parking 2.5 FAR Standard Parking 2.5 FAR Reduced Parking $3,757,000 $5,137,000 $1,380,000 Not feasible $3,599,000 $4,392,000. $4,192,000 $7,078,000 $6,396,000 $3,208,000 $8,426,000 $8,109,000 $8,426,000 $9,954,000 $10,791,000 $14,075,000 .$4,988,000 $6,838,000 $6,646,000 $9,773,000 $9,496,000 $4,142,000 $13,344,000 $13,023,000 $13,344,000 $16,819,000 $16,528,000 $22,898,000 $1,?88,ooo $2,446;000 $2,454,000 $2,696,000 $3,099,000 $934,O0O $4,918,000 $4,914,000 $4,918,000 $6,864,000 $5,73~,000 $8,823,0Q0 Not feasible, needs ~25% increase in ~:oss revenue Feasible with ~1% increase ~ goss revenue Feasible with ~1% increase in goss revenue Feasible Feasible, could absorb some reduction in condo values or increased costs Not feasible Feasible, and feasible with substation priced at $155/Lot Sq.Ft. Feasible, and feasible with substation priced at $155/Lot Sq.Ft. Feasible, and feasible with substation priced at $155/Lot Sq.Ft.. Feasible, and feasible with substation priced at $280/Lot Sq. Ft. Feasible, and feasible with+ substation priced at $205/Lot Sq. Ft. Feasible, and feasible ~vith substation priced at $400/Lot Sq. Ft. Sacramento Region Office 740 G Street Davis, CA 956516 Headquart,ers 530,750,2195 539.750.2194 fax bayareaeconomics.com 510.549.7310 12 Giound Floor Office Restrictions As part of the economic analysis, BAE reviewed retail market conditions within SOFA Phase II. BAE did not estimate the gross annual demand for retail space within the area or forecast future retail demand within SOFA. Rather, BAE reviewed existing work performed by Wallace and Stiechen, Inc. in June, 2001 and contacted 16cal retailers, developers, .and brokers witlzin SOFA to gather qualitative information on the overall retail demand within SOFA, as a substitute for office uses. Further analysis on available parking, the total potential retail space in SOFA, and an .analysis of retail demand within walking distance of SOFA would provide a more comprehensive understanding of retail market conditions within SOFA and the potential economic impact of curtailing office uses on the ground floor. SOFA - West Retail Market Stttdy The South of Forest Area -~v~est, Retail Market Study (Wallace & Steichen, Inc., June 2001) was limited to a general overview of existing retail conditions and to analyzing demand for grocery store space in SOFA Phase II. The study does not attempt to estimate the total supportable retail space in the area nor analyze other retail store categories on their economic viability in the SOFA Phase II area. According to the SOFA Retail Market Study, the SOFA Phase II area has 62,000 square feet of retail space, with more than 50 percent of the space dedicated to grocery and eating and drinking establishments. These establishments are scattered throughout the SOFA Phase II area with slightly greater concentrations of retail space on Homer Avenue and Emerson Street. The SOFA Retail Market Study assumed households within the 94301 zip code to be the primary trade area. According to their retail market study, the primary trade area has 7,609 households containing 16,510 residents. These households tend be more affluent and have lower household sizes than Palo Alto households in general, with an estimated per capita income of approximately $82,000 in 2000 and an average household size of 2.1 persons per household. The SOFA Retail Market Study estima}ed the amount of supportable retail square feet for grocery retail within SOFA. The analysis shows SOFA’s total supp0rtable grocery demand at 44,000 square feet.6 After accounting for the 22,000 square foot Whole Foods store at Homer Avenue and Emerson Street, the report estimates SOFA could support another 22,000 in grocery retail space. The SOFA Retail Market Study did not provide a supportable square foot estimate for other retail categories, but rather, provided a rough es’timate that another 30,000 to 100,000 square feet of retail could be supported in SOFA within a ten-year period. If the SOFA Phase II area could only attain the lower estimate of 30,000 square feet, a new commercial building or buildings with existing retail tenants could be financially impacted by a zoning ordinance that curtailed office use on the ground floor. ~ The SOFA Retail Market Study estimate a total sales potential for grocery expenditures of $35,120,000 and assumes $800 per square foot. Sacramento Region Office 530.750.2195 740 G Street 539.-/50.2194 fax Davis, CA 956516 bayareaeconomics.com Headquarters 510.549.7310 i3 Due to .scope constraints, BAE did not obtain the total existing and potential colranercial square footage witliin the SOFA Phase II area. Nonetheless, assuming a 30,000 square foot retail square foot absorption over ten years and limiting office uses on the ground floor for new and existing retail buildings would likely result in higher Commercial space vacancies, especially in areas that do not have retail synergies, and lack walk-by traffic. Based on .the higher 100,000 square feet retail absorption estimate, new and existing retail space could expect healthier real estate conditions but still may be impacted if newly redeveloped parcels added more than 100,000 retail square feet in addition to the estimated 62,000 retail square feet already within the SOFA Phase II area. Retail AbsotTtion Under the Working Group artd the Staff Alternative, only new colmnercial space within specified area of SOFA Phase II area and buildings that already contain retail tenants in specified areas would be affected by the ground floor limits on office uses. Existing ground floor office buildings are grandfathered in and coutd continue to lease to office tenants. If the office tenant vacated the space, the landowner would have a year to backfill the space with another office tenant as long as he or she did not expand the.total square footage of the building. Therefore, the area should not experience a sudden injection of available retail space but rather, will likely result in an incremental increase in the amount of retail square-feet as. sites are sporadically redeveloped. Existing Office Market Colzditions The regional office mar~cet is currently recovering from a considerable increase in office vacancies and subsequent decline in market lease rates as a result of the slowdown of high tech and venture capital employment and a recent injection of office space. According to CB Richard Ellis 2002 1st Quarter Report, Palo Alto’s office market had an overall vacancy rate of 18 percent-, and lost approximately 34,000 square feet in the total occupied office tenant space from the previous quarter. The report also .estimated another 167,000 square feet was under construction: While Palo Alto has been affected less than.many other jurisdictions~ it has seen a rise in office vacancies. Compounding the increase in office vacancies is new office developments under construction at Whiskey Gulch in East Palo Alto, showing a short-term risk in developing office space of any considerable size. Lenders indicated a general hesitation to underwrit.e large office projects. While this creates some impact to small office developers, they do not compete at the same level as large scale office projects which are more affected by regional economic downturns. Nongtheless, the overall office market in Palo Alto is soft and do not justify large scale new speculative construction in the short term. On the other side, retail real estate market conditions have remained relatively healthy BAE found only three buildings within the vicinity of the SOFA Phase II area that had available retail space for lease. In general, those spaces were asking comparable lease rates to available office spaces. BAE did not locate any subregional retail market reports that spoke to retail real estate conditions in the Palo Alto area. Sacramento Region Office 740 G Street Davis, CA 956516 Headquarters 530.750.2195 539.750.2194 fax bayareaeconomics.com 510.549.7310 i4 Developing Retail Synergy Certain areas within the SOFA Phase II may be better suited for retail. The intersection of Emerson and Homer Avenue contain higher concentrations ofretaii uses compared to the SOFA Phase II area overall. The Retail Market Study states that, "small retailers cannot .survive unless they are located close to other retailers that supply similar or complimentary goods and services.’" Targeting specific retai! nodes within SOFA Phase Ii for retailers while allowing office users elsewhere m.ay encourage the concentration retail uses and improve local retail synergy. This assumes that a colmuercial building can obtain a higher premium for office use than for a retailer. In this scenario, office users would locate along streets that allowed for large office space thereby pushing retailers towards specific locations within the SOFA Phase II area. Currently, office and retail lease rates are comparable and a co~mrtercial building owner would not find sufficient financial incentive to target office tenants over retail tenants. Notwithstanding, certain streets within the SOFA Phase II area are not conducive to retail uses. For example, Ahna Street is a heavy auto traffic corridor that does not have on street parldng. This area would not be conducive to retail uses. Commercial Space FlexibiIity and Absorption Limiting commercial landowner flexibility is likely to be the largest economic impact.as a result of curtailing office uses within the SOFA Phase lI area. A landowner with vacant retail space would only be able to target retail tenants rather than allowing either a retailer or an office user to hahabit the space.’ This may result in lor~ger vacancies and-if the space remaiued vacant long enough- a reduction in the asking lease rates as the landowner weighs the loss in potential revenue over a vacant property generating zero revenue~ Simultaneously, owners of ground floor office spaces may be hesitant to lease space to a prospective .retailer because -under the proposed ordinance- the landowner would be unable to convert it back to office space. Under existing conditions, retail remains relatively healthy in Palo Alto overali compared to a recovering office market. However, fluctuations in real estate market conditions that increase demand for officg and reduced demand for retail can and do occur. The result would be a loss in potential revenue as commercial landowners would be precluded from-leasing the space to a higher income generating use. Parking The SOFA Retail Market Study poiut~s out that, "...successful convenience retailing requires convenient, easily accessible parking." BAE did not obtain an inventory of parking within the SOFA Phase H area but did receive qualitative information from brokers, developers, and landowners who stated that there is a shortage ofparking within the area. As discussed earlier, they argued that they the SOFA Phase II area retailers would have to compete with downtown retailers, which are part of aparking district. While new development would likely cover its share of parking demand under the Specific Plan’s parking requirements of four spaces per 1,000 building square feet, an existing parking Shortfall within SOFA could reduce the 7 Wallace, John; Retail Market Study South of Forest Area - West, City of Palo Alto, June, 2001, page 17. lbid, page 18. Sacramento Region Office 530.750.2195 740 G Street 539.750.2194 fax Davis, CA 9565~fi bayareaeconomics.com Headquarters 5"10.549.73~10 15 economic viability of retail in the area. As discussed earlier, the City of Paio Alto is attempting to’ alleviate the existing parking shortfall in the downtown by building 700 additional public parking spaces. This will help. to alleviate parking pressures placed on adjacent communities, including the SOFA Phase II area. Conch¢sions ~ ¯ Curtailing- ground floor office uses within the-SOFA Phase II area altogether may deter redevel.opment projects that create mixed-use, products. Properties not withil~ close proximity to other retail services that could .not create retail synergles are likely to struggle to maintain a ¯ retail tenant at Comparable office lease rates. The result WouId be a greater emphasis on residential projects compared to building both retail and residential mixed use. Furthermore, if parking availability is exceedingly Constrained within the area, developers may have difficulty competing with nearby downtown retail space, which are a part of a parking district. Notwithstanding, current retail market conditions are relatively healthy and would likely support new retail. A possible alternative could be to limit ground floor office uses along specific retail nodes and allow ground floor office in areas that are less conducive to retail. ¯ .Based on existing retail conditions, logical retail iocati0ns appear to be Homer Avenue and Emerson Street. Corridors less conducive to retail include Alma Street and Ramona Streets. Sacramento Region Office 740 G Street Davis, CA 956516 Headquarters 530.750.2195 539.750.2194fax ba~areaeconomics.com 510.549.7310 16 o 00 o 0 8 8 o o °~ o 0 oo 8 8 0 0 o 8 8 8 o 0 0 0 o 8 8 8 o c g o Eoc) ZZZ CD0 Z Z "~ Z Z ~ Z Z q) LL o o ~ ZZ Z o o o o o o o ~ Z Z Z o om Z ZZ "E o o o z ,o z z q9 z O.0 0 ZZZ o c r-c o ~ Z Z Z Z Z Z Z Z Z ZZZZZZ ~ o o ~ ZI] LLJ Appendix E: Small Site, Existing Zoning Regulations (0.6 FAR) Development Program Number Unit Parking Required Spaces Lot Size 10,500 Sq. Ft.Retail Parking 1 Sp/250 Sq, FL Corn mercial Space 3,500 Bldg. Sq, Ft.Office Parking 1 Sp/250 Sq. Ft. Retail Square Feet .Residential Parking 2 Sp/Unit Office Square Feet 3,500 Bldg. Sq. Ft. Total Rental Units 2 Unit,@l,400 Sq. Ft. Each Parking Type Space~ Residential Square Feet 2,800 Sq. Ft.Surface Parking Total Building Square Feet 6,300 Sq. Ft.Podium Parking Underground Parking 14 4 18 HARD COSTS Item Site Area improvements Commercia’ Construction (a) Residential Building (b) Surface Parking (c) TOTAL Number Unit Price Unit Item Costs 10,500 Sq. Ft.$6 /Sq. Ft,$63,000 3,500 Bldg, Sq.Ft.$156 /Bldg. Sq.FL $546,000 2,800 Bldg. Sq.Ft.$142 /Bldg, Sq.Ft.$396,872 6,000 Sq. Ft.$8 /Sq.Ft.$48,000 6,300 Bldg. Sq. Ft.$1,053,872 Unit Price Unit Item Costs Total Hard Costs 5% of Total Hard Costs.$52,694 Total Hard Costs 2,5% of Total .Hard Costs $26,347 SOFT COSTS Item Number Architecture Fees $1,053,872 Engineering Fees $1,053,872 Development ImI3act Fees and Buildinq Fees Development Impact Fees Commercial Residential Building Fees Plumbing, Mechanical, and Electdc Building Fees School Fees Commercial Residential Plan Check Fees (d) Utilibj Fees (d) donstruction Financinq Costs Loan to Value Ratio $1,262,158 Length of Construction Period 8 Drawdown Factor $946,618 ConstrUction Loan Rate $946,618 Loan =ees $946,618 Permanent Loan Fees $976,792 Project Contingency $1,312,157 TOTAL SOFT COSTS 3,500 BIdg, Sq. Ft,$18.75 /Bldg. Sq.Ft.$65,625 2 Units@l,400 Sq. Ft, Ea $6,930 /Unit $13,860 6,300 Bldg. Sq. Ft.$0.18 /Bldg. Sq.Ft.$1,134 $1,053,872 Total Hard Costs $5,892 + $3.85/additional $1,000 $6,105 3,500 Bldg. Sq. Ft,$0.34 /Bldg. Sq.Ft.$1,190 2,800 Living Area $2,14 /Bldg. Sq. Ft. of Living Area $5,992 1 Project $14,539 /Project $14,539 1 Project $20,800 /Project $20,800 Total Value 0.75 of Total Value months. Total Loan 0.55 of Total Loan Total Loan 7.5% of Total Loan/Year $26,032 Total Loan 1.5% of Total Loan $14,199 Permanent Loan 1% of Perrnahent Loan $9,768 Hard & Soft Costs 5% of Hard & Soft costs $65,608 $323,893 DEVELOPER PROFIT $1,327,766 Har~ & Soft Costs (e)12% of Hard & Soft costs (e)$159,332 TOTAL CONSTRUCTI~3N COSTS:~,~{ilt;[$~l~,~’~i~.~; REVENUES and EXPENSES Number Unit Price Per Unit ’Total OFFICE LEASING Monthly Lease Rate (NNN)3,500 Bldg. Sq. Ft.$3.50 ISq. Ft.$12,250 Less Vacancy 10% of Potential Revenu~($1,225) Monthly Ooerating Expenses 3,500 Bldg. Sq. Ft.($0.35) /Sq. Et.($1,225) RESIDENTIAL LEASING Monthly Lease Rate 2,800 Bldg. Sq. Ft.$1.90 /Sq. Ft.$5,320 1750 Less Vacancy 5% of Potential Revenue ($266)21000 Monthly Operating Expenses 30% of Potential Revenue ($1,596)300000 TOTAL MONTHLY REVENUE 6,300 Bldg. Sq. Ft.$2.10 /Sq. Ft.$13,258 NET ANNUAL REVENUE: Capitalized Value Estimate Net Annual Revenue $159,096 Capitalization Rate 8.0% Total Capitalized Value $1,988,700 Minus Tolal Development Costs $1,537,097 LAND RESIDUAL VALUE $43.01 /Lot. Sq, Ft,I ~i: ’$451i603’.I Notes: (a) Assumes wood frame construction with tenant improvements included at $40 per square foot. See Appendix S for a full building detail. (b) Assumes 1.400 square foot units with wood frame construction, custom quality construction, skylight, and full appliances. (c) For surface parking assumes 333 square feet a space with landscaping. (d) See Appendix T for a detail list of planning, building, and development impact fees. (e) Financing costs are not included in calculating developer profit. (t] ]he estimated monthly unit expense rate is $4,000 per year due to a lack of economies of scale. Sources: RS Mean Square Foot Construction Costs, 2002; Ross Construction, 2002; Seque Construction; 2002; J.R. Roberts Construction, 2002; Classic Communities, 2002; Dollars and Cents, Multifamily Housing, 2002; BAE, 2002. _Appendix F: Small Site, 1,15 FAR Alternative-Standard Parkin9 Development Program Lot Size Commercial Space Retail Square Feet Office Square Feet Total Condominiums Residential Square Feet Total Building Square Feet Number Unit Parking Required 10,500 Sq. Ft.Retail Parking 1 Sp/250 Sq. Ft. Bldg. Sq. Ft.Office Parking I Sp/250 Sq. Ft. Bldg. Sq. Ft. -Residential Parking 2.3 Sp/Unit Bldg. Sq. Ft. 7 Units@l,500 Sq. Ft. Each Parking Type 10,500 Bldg. Sq. Ft.Surface Parking 10,500 Bldg. Sq. Ft.Partially Submerged Podium Parking Undergraund Parking Spaces 17 Spaces 17 HARD COSTS Item Number Unit Cost Unit Site Area Improvements I0,500 Sq. Ft.$6 /Sq. Ft. Residential Building (a)10,500 Bldg. Sq. Ft.$160 /Bldg. Sq. Ft. Podium Parking (b)7,200 -Sq. Ft..$45 /Sq."Ft. TOTAL 10,500 Bldg. Sq. Ft. SOFT COSTS Item Number Unit Cost Unit Architecture Fees $2,067,315 Total Hard Costs Engineering Fees $2,067,315 Total Hard Costs Defect [_iability Wrap Insurance 1 Project Video Recording of Construction 1 Project Development Impact Fees and Buildin~ Fees Development Impact Fees 7 BMR Residential In-Lieu Fee $5,407,500 Buildi.ng Fees Plumbing, Mechanical, and Electric 10,500 Building Fees . $2,067,315 Item Costs Price/Unit $63,000 $9,000 $1,680,315 $240,045 $324,000 $46,286 $2,067,315 $295,331 Excavation Fees 9,600 School Fees 10,500 Plan Check Fees 1 Utility Fees 1 Construction Financinq Costs Loan to Value Ratio $3,094,179 Length of Construction Period 16 Drawdown Factor $2,320,634 Construction Loan Rate $2,320,634 Loan Fees $2,320,634 Project Contingency $3,268,226 TOTAL SOFT COSTS Item Costs Price/Unit 5% of Tot~il Hard Gosts $103,366 $14,767 .2.5% of Total Hard Costs $51,683 $7,383 $420,000 $3 Million in Coverage "$420,000 $60,000 $50,000 /Project $50;000 $7,143 Units $6,930 /Unit $48,510 $6,930 Appraised Apt Value 5% *Appraised Apartment Value $270,375 . $38,625 Bldg. Sq. Ft.$0.18 /Bldg. Sq. Ft.$1,890 $270 Total Hard Costs $5,892 + $3.85/additional $1,000 $10,111 $1,444 Cubic Yards $1,000 + $100/additional 1,000 C.Y.$1,900 .$271 Living Area $2.14 Bldg. Sq. Ft. of LMng Area $22,470 $3,210 Project $21,260 /Project $2:1,260 $3,037 Project $25,300 /Project $25,300 $3,614 Total Value.0.75 of Total Value months Total Loan 0.60 of Total Loan Total Loan 7.5% of Total Loan/Year $139,238 $19,891 Total Loan 1.5% of Total Loai]$34,810 $4,973 Hard & Soft Costs 5% of Hard & Soft Costs $163,411 $23,344 $1,364,323 $194,903 DEVELOPER PROFIT $3,257,590 Hard & Soft Costs (d)10% of Hard & S{Jft Cos.ts (d)$325,759 $46,537 TOTAL CONSTRUCTION COSTS: REVENUES and EXPENSES Number Unit " Price Unit Total Price/Unit RESIDENTIAL UNIT SALES Market Price 10,500 Bldg. Sq. Ft.$515 /Bldg. Sq. Ft.$5,407,500 $772,500 Brokerage and Marketing Expenses 5% of Potential Revenue ($270,375)($38,625) TOTAL REVENUE 10,500 Bldg. Sq. Ft.$489 /Bldg. Sq. Ft.$5,137;125 $733,875 Notes: (a) Assumes 1,500 square foot units with wood frame high-quality construction, skylight, wood floors a~d full kitchen appliances. See Appendix S for a full unit detail (b) Assumes 423 square feet per space. (c) See Appendix T for a detail list of planning, building, and development impact fees. (d) Financing costsare not included in calculating developer profit. Sources: RS Mean Square Foot Construction Costs, 2002; Ross Construction, 2002; Segue Construction; 2002; J.R. Roberts Construction, 2002; Classic Communities, 2002; Dollars and Cents, Multifamily Rousing, 2002; BAR, 2002. Appendix G: Srnall Site, 1,1 5 FAR Alternative-Reduced Parkin9 Development Program Lot Size Commercial Space Retail Square Feet Office Square Feet Total Condominiums Residential Square Feet Total BuildingSquare Feet Number Unit 10,500 Sq. Ft. Bldg. Sq. Ft. Bldg. sq. Ft. Bldg. Sq. Ft. 7 Units@l,500 Sq. Ft. Each 10,500 Bldg. Sq. Ft. 10,500 Bldg..Sq. Ft. Parking Required Retail Parking 1 Sp/250 Sq. Ft. Office Parking .1 Sp/350 Sq. Ft. Residential Parking 1.5 Sp/Unit Spaces. 11 Parking Type Surface Parking" Partially Submerged ~odium Parking Underground Parking Spaces 11 HARD COSTS item Number Unit Cost Unit Item Costs Price/Unit Site Area Improvements 10,500 Sq. Ft.$6 /Sq. Ft.$63,000 $9,000Residential Building (a)10,500 Bldg. Sq. Ft.$160 /B.Idg. Sq. Ft.$1,680,315 $240,045 Podium Parking (b)4,700 Sq. Ft.$45 /Sq. Ft.$211,500 $30,214 TOTAL 10,500 Bldg. Sq. Ft.$1,954,815 $279,259 SOFT COSTS Item Nt~mber Architecture Fees $1,954,815 Engineering Fees $1,954,815 Defect Liability Wrap Insurance 1 Video Recording of Construction 1 Development Impact Fees and Buildin~l Fees (c) Development Impact Fees 7 BMR Residential In-Lieu Fee $5,250,000 Building Fees Unit Cost Unit Item Costs Price/Unit Total Hard Costs 5% of Total Hard Costs $97,741 $13,963 Total Hard Costs 2.5% of Total Hard Costs $48,870 $6,981Project$420,000 $3 Million in Coverage $420,000 $60,000 . Project $50,000 /Project $50,000 $7,143 Units $6,930 /Unit $48,510 $6,930 Appraised Apt Value 5% *Appraised Apartment Value $262,500 $37,500 Plumbing, Mechanical, and Electric 10,500 Bldg. Sq. Ft.$0.18 /Bldg. Sq. Ft.$1,890 $270 Building Fees $1,954,815 Total Hard Costs $5,892 + $3.85/additional $1,000 $9,664 $1,381 Excavation Fees 6,300 Cubic Yards $1,000 + $100/additional 1,000 C,Y.$1,600 $229 School Fees 10,500 Living Area $2.14 Bldg. Sq. Ft. of Living Area $22,470 $3,210 Plan Check Fees 1 Project $20,589 /Project $20,589 $2,941 Utility Fees 1 Project $25,300 /Project $25,300 $3,614 Construction Financinq Costs Loan to Value Ratio $2,963,949 Total Value 0.75 of Total Value L~ngth of Construction Period 16 months " " Drawdown Factor $2,222,962 Total Loan 0.60 of Total Loan " Construction Loan Rate $2,222,962 Total Loan 7.5% of Total Loan/Year $133,378 $19,054 - Loan Fees $2,222,962 Total Loan 1.5% of Total Loan $33,344 $4,763 Project Contingency $3,130,671 Hard & Soft Costs 5% of Hard & Soft Costs $156,534 $22,362 TOTAL SOFT COSTS $1,332,390 $190,341 DEVELOPER PROFIT $3,120,483 Hard& Soft Costs (d)10% of Hard & Soft Costs (d)$312,048 $44,578 TOTAL CONSTRUCTION COSTS: REVENUES and EXPENSES RESIDENTIAL UNIT SALES Market Price Brokerage and Marketing Expenses TOTAL REVENUE Number Unit Price Unit Total Price/Unit 10,500 Bldg. Sq. Ft.$500 /Sq. Ft.$5,250,000 $750,000 5% of Potential Revenue ($262,500)($37,500) 10,500 Bldg. Sq. Ft.$475 /Sq. Ft.$4,987,500 $712,500 Notes: (a) Assumes 1,500 square foot units with wood frame construction, high-quality construction, skylight, wood floors and full kitchen appliances. See Appendix S for a full unit detail (b) Assumes 427 square feet a space. (c) See Appendix T for a detail list of planning, building, and development impact fees. (d) Financing costs are not included in calculating developer profit. Sources: RS Mean Square Foot Construction Costs, 2002; Ross Construction, 2002; Segue Construction 2002 J.R. Roberts Construction, 2002; Classic Communities, 2002; Dollars and Cents, Mu]tifami!y Housing, 2002; BAE, 2002. Appendix H: Small Site, 1.5 FAR Alternative-Standard Parking Development Program Lot Size Commercial Space Retail Square Feet Office Square Feet Total Condominiums Residential Square Feet Total Building Square Feet Number Unit 10,500 Sq. Ft. Bldg. Sq. Ft. Bldg. Sq. Ft. Bldg. Sq" Ft. 10 Units@l,500 Sq. Ft. Each " 15,000 Bldg. Sq. Ft. 15,00Q Bldg. Sq. Ft. Parking Required Retail Parking 1 Sp/250 Sq. Ft. Office Parking 1 Sp/250 Sq. Ft. Residential Parking 2.3 Sp/Unit Spaces Parking Type ¯ Surface Parking Partially Submerged Podium Parking Underground Parking Spaces 23 23 HARD COSTS Item Number Unit Cost Unit Site Area Improvements 10,500 Sq. Ft.$6 /Sq. Ft. Residential Building (a)15,000 Bldg. Sq. Ft..$151 /Bldg. Sq. Ft. Podium Parking (b)9,775 Sq. Ft.$45 /Sq[ Ft. TOTAL 15,000 Bldg. Sq. Ft. Item Costs Price/Unit $63.000 $6,300 $2,259,000 $225,900 $439,875 $43,988 $2,761,875 $276,188 SOFT COSTS Item Number Architecture Fees $2,761,875 Engineering Fees i $2,761,875 Defect Liability Wrap Insurance 1 Video Recording of Construction 1 Development Impact Fees and Buildinq Fees Development Impact Fees 10 Building Fees Plumbing, Mechanical, and Electric 15,000 Building Fees $2,761,875 Excavation Fees 13,100 School Fees 15,000 Ptan Check Fees Utility Fees Construction Financing Costs Loan to Value Ratio Length of Construction Period Drawdown Factor Construction Loan Rate Loan Fees Project Contingency TOTAL SOFT COSTS 1 1 Unit Cpst Unit T6tal Hard Costs 5% of Total Hard Costs Total Hard Costs 2.5% of Total Hard Costs Project $420,000 $3 Million in Coverage Project $50,000- /Project Units $6,930 /Unit B. Idg. Sq. Ft., Total Hard Costs Cubic Yards Living Area Project Project $0.18 /Bldg. Sq. Ft. $5,892 + $3.85/additional $1,000 $1,000 + $100/additional 1,000 C.Y. $2.14 Bldg. Sq. Ft. of Living Area $25,680 /Project $33,150 /Project $3,617,098 Total Value 0.75 of Total Value 16 months $2,712,823 Total Loan 0.60 of Total Loan $2,712,823 Total Loan 7.5% of Total Loan/Year $2,712,823 Total Loan 1.5% of Total Loan $3,820,560 Hard & Soft Costs 5% of Hard & Soft costs item Costs Price/Unit $I38,094 $13,809 $69,047 $6,905 $420,000 $42,000 $50,000 $5,000 $69,300 $6,930 $2,700 $270 $12,852 $1,285 $2,300 $230 $32,100 $3,210 $2g,680 $2,568 $33,150 $3,315 $162,769 $16,277 $40~692 $4,069 $191,028 $19,103 $1,249,712 $124,971 DEVELORER PROFIT $3,808,126 Hard & Soft Costs (d)10% of Hard & SoftCosts (d)$380,813 $38,081 TOTAL CONSTRUCTION COSTS:i~i~ii!!~[~!#!":~~’~’0_"~i~i~i!j~:~i:~-~-~,~,~i~4 Number Unit Price -Unit ~otal Price/unitREVENUES and EXPENSES RESIDENTIAL UNIT SALES Market Price Below Market Rate Unit Price (e) Brokerage and Marketing Expenses TOTAL REVENUE 13,500 Bldg. Sq, Ft.$515 /Bldg. Sq. Ft.$6,952,500 $772,500 1,500 Bldg. Sq. Ft.$164 /Bldg. Sq. Ft.$245.388 $245,388 ¯ "5% of Potential Revenue ($359,894)($35,989) 15,000 Bldg. Sq. Ft.$456 /Bldg. Sq. Ft.$6,837,994 $683,799 Notes: (a) Assumes 1,500 square foot units with wood frame.construction, high-quality construction, skylight, wood floors and full kitchen appliances. See Appendix S for a full unit detail (b) Assumes 425 square feet per space. (c) See Appendix T for a detail list of planning, building, and developmentimpact fees. (d) Financing costs are not included in calculating developer profit. (e) The below market rate unit pri~e is based on Santa Clara County’s median income for a four person household according to the Department of Housing and Community Development. See Appendix U for an explanation of the BMR home price. Sources: RS Mean Square Foot Construction Costs, 2002; Ross Construction, 2002; Segue Construction; 2002;.J.R. Roberts Construction. 2002; Classic Communities, 2002; Do lars and Cents, Mulfifamily Housing, 2002; BAE, 2002. Appendix I: Small Site, 1.5 FAR Alternative-Reduced Parking Development Program Lot Size Commercial Space Retail Square Feet Office Square Feet Total Condominiums Residential Square Feet Total Building Square Feet Number Unit 10,500 Sq. Ft. Sq. Ft. Sq. Ft. 10 Units@l,500 Sq. Ft. Each 15,000 Bldg. Sq. Ft. 15,000 Bldg. Sq. Ft. Parking Required Retail Parking 1 Sp/250 Sq. Ft. Office Parking 1 Sp/350 Sq. Ft. Residential Parking 1.5 Sp/Unit Spaces 15 Parking Type Surface Parking Radially Submerged Podium Parking Underground Parking Spaces 15 HARD COSTS Item Number Unit Cost Unit Item Costs Price/Unit Site Area Improvements 10,500 Sq. Ft.$6 /Sq. Ft.$63,000 $6,300 Residential Building (a)15,000 Bldg. Sq. Ft..$151 /Bldg. Sq. Ft.$2+259,000 $225,900 Podium Parking (b)6,400 Sq. Ft.$45 /Sq. Ft.$288,000 $28,800 TOTAL 15,000 Bldg. Sq..Ft.$2,610,000 $261,000 SOFT COSTS Item Number Architecture Fees $2,610,000 Engineering Fees $2,610,000 Defect Liability Wrap Insurance " "1 Video Recording of Construction 1 Development Impact Fees and Buildin.q Fees Development Impact Fees 10 Building Fees Plumbing, Mechanical, and Electric 15,000 Building Fees $2,610,000 Excavation Fees 8,600 School Fees 15,000 Plan Check Fees 1 Utility Fees 1 Construction Financinq Costs Loan to Value Ratio $3,451,829 Length of Construction .Period 16 Drawdown Factor $2,588,872 Construction Loan Rate $2,588,872 Loan Fees $2,588,872 Project Contingency $3,645,995 TOTAL SOF:I- COSTS Unit Cost Unit Item Costs Price/Unit Total Hard Costs 5% of Total Hard Costs $:130,500 $13,050 Total Hard Costs 2.5% of Total Hard Costs $65,250 $6,525 Project $420,000 $3 Million in Coverage $420,000 $42,000 Project $50,000 /Project $50,000 $5,000 Units $6,930 /Unit $69,300 $6,930 Bldg. Sq. Ft..$0.18 /Bldg. Sq. Ft. Total Hard Costs $5,892 + $3.85/additional $1,000 Cubic Yards $1,000 + $100/additional 1,000 C.Y. Living Area $2.I4 Bldg. Sq. Ft. of Living Area Project $24,778 /Project Project $33(~ 50 /Project DEVELOPER PROFIT. Total Value 0.75 of Total Value months $2,700 $270 $12,252 $1,225 $1,800 $180 $32,100 $3,210 $24~778 $2,478 $33,150 $3,315 Total Loan 0.60 of Total Loan Total Loan 7.5% of Total Loan/Year $155,332 $15,533 Total Loan 1.5% of Total Loan $38,833 $3,883 Hard & Soft Costs 5% of Hard & Soft Costs $182,300 ¯ $18,230 $I ,2,18,294 $121,829 $3,634;129 Hard & Soft Costs (d)10% of Hard & Soft Costs(d)$363,413 $36,341 TOTAL CONSTRUCTION COSTS:. ~&~pi:$4(19tl 7,.0.~:’ ..: ~.$4.19~1~11 " Number Unit Price Unit Total Price/UnitREVENUES and EXPENSES RESIDENTIAL UNIT SALES Market Pdce Below Market Rate Unit Price (e) Brokerage and Marketing Expenses TOTAL REVENUE 13,500 Bldg. Sq. Ft.$500 /Bldg. Sq. Ft.$6,750,000 $750,000 1,500 Bldg. Sq. Ft.$164 /Bldg. Sq. Ft.$245,388 $245,388 5% of Potential Revenue ($349,769)($34,977) 15,000 Bldg. Sq. Ft.$443 /Bldg. Sq. Ft.$6,645,619 $664,562 ~2L:~;.L: :~.tE?:J.2~+:~+~:~:5~:’Z~:~:+;+C:L,’.:?~:k:A.~;~.~:~ ..............:,-:-+J ...........~-+u+~2;~:+~;+:~+~ ~,.~:,~,~+.:::~;~,,+~++.z~:~ ....~ " + ~++: ............................-- Notes: (a) Assumes 1,500 square foot units with wood frame construction, high-quality construction, skylight, wood floors and full kitchen appliances. See Appendix S for a full unit detail (b) Assumes 425 square feet per space. (c) See Appendix T for a detail list of planning, building, and development impact fees. (d) Financing costs are not included in calculating developer profit. (e) The below market rate unit price is based on Santa Clara County’s median income for a four person household according to the Department of Housing and Community Development. See Appendix U for an explanation of the BMR home price. Sources: RS Mean Square Foot Construction Costs, 2002; Ross Construction, 2002; Segue Construction; 2002; J.R. Roberts Construction, 2007: Classic Communities, 2002; Dollars and Cents, Multifamily Housing, 2002; BAE, 2002. Appendix J: Small Site 2.0 FAR Alternative-Standard Periling Developm’ent Program Number Unit Lot Size 10,500 Sq. Ft. Commercial Space Bldg. Sq. Ft. Retail Square Feet Bldg. Sq. Ft. Office Square Feet . Bldg. Sq. Ft. TotalCondominiums 14 Units@l,500 Sq. Ft. Each Residential Square Feet 21,000 Bldg. Sq. Ft. Residential C6rridor Circulation 1,000 Bldg. Sq. Ft. Total Building Square Feet 22,000 Bldg. Sq. Ft. .Parklng Required Relail Parking 1 Sp1250 Sq. Ft. Office Parking 1 Sp1250 Sq. Ft. Residential Parking 2.3 Sp/Unit Spaces 33 Parking Type . Spaces¯ Tuck-Under Alley Parking Partially Submerged Podium Parking Underground Parking (a)33 HARD COSTS Item Number Unit Cost Unit Item Costs Price/Unit Site Area Improvements 10,500 Sq. Ft.$6 /Sq. Ft.$63,000 $4,500 Residential Building (b)22,000 Bldg. Sq. Ft..$152 /Bldg. Sq.Ft.$3,347,080 $239,077 Underground Parking/c)15,675 Sq. Ft.$75 /Sq. Ft.$1,17~,625 $83,973 TOTAL 22,000 BIdg. Sq. Ft.$4,585,705 $327,550 SOFT COSTS Item Number Unit Architecture Fees $4,585,705 Total Hard Costs Engineering.Fees $4,585,705 Total Hard Costs Defect Liability Wrap Insurance - .1 Project Video Recordiqg of Construction t Project Development Impact Fees end Bulldin~l Fees {c) Development Impact Fees 14 BMR Fee $3,090,000 Building Fees Plumbing, Mechanical, and Electric 22,000 Building Fees $4,585,705 Excavation Fees 24,400 School Fees Residential 21,000 Living Area Plan Check Fees 1 Project Utility Fees 1 Project Construction Financing Costs Loan to Value Ratio $5,800,170 Total Va]ue Length of.Construction Period 18 months Drawdewn Factor $4,350,127 Total Loan Construction Loan Rate $4,350,127 Loan Fees $4,350,127 Project Contingency $6,159,055 TOTAL SOFT COSTS Cost Unit Item costs Price/Unit 5% of Total Hard Costs $229,285 $16,378 2.5% of Total Hard Costs $114,643 $8,189 $420,000 $3 Million in Coverage $420,000 $30,000 $50,000 /Project $50,000 $3,571 Units $6,930 /UniL $97,020 $6,930 Appraised Apt Value (e)5% *Appraised Apartment Value $154,500 $11,036 Bldg. Sq. Ft..$0.18 /Bldg. Sq.Ft.$3,960 $283 Total Hard Costs $5,892 + $3.85/additional $1,000 $20,057 $1,433 Cubic Yards $2,000 + $1001additiona110,000 C.Y.$2,200 $157 $2.14 /S~]. Ft. of Living Area $44,940 $3,210 $36,910 /Project $36,910 $2,636 $40,950 /Project $40,950 $2,925 0.75 of Total Value 0.60 of Tatal Loan Total Loan 7.5% of Total Loan/Year $293,634 . $20,974Total Loan 1.5% of Total Loan $65,252 $4,661 Hard & Soft Costs 5% of Hard & Soft costs $307,953 $21,997 $1,881,303 $134,379 DEVELOPER PROFIT $6,108,123 Hard & Soft Costs (e)10% of Hard & Soft Costs (d) ~$610,812 $43,629 TOTAL CONSTRUCTION COSTS;~!~-~’]~$~;0~820~,.i]~,~05 569..= REVENUES and EXPENSES Number Unit Prtce Unit Total Prlce/Unit RESIDENTIAL UNIT SALES ’¯ Market Price 19,~00 Bldg. Sq. Ft.$515 /Bldg. Sq. Ft.$10,042,500 $772,500 Below Market Rate Unit Price (0 1,500 Bldg. Sq. Ft.$164 /Bldg. Sq. Ft.$245,388 $245,368 Brokerage and Marketing Expenses 5% of Potential Revenue ($~14,394)($36,742) TOTAL REVENUE $9,773,494 $698,107 .Notes: (a) Assumes two levels of underground parking. (b) Assumes 1,500 square foot units with wood frame construction, high-quality construction, skylight, wood floors and full kitchen appliances. See Appendix S for a full unit detail (c) Tuck Under Alley Parking assumes 250 square feet a space. Underground parking assumes 475 square feet a space. (d) See Appendix T for a detail list of planning, building, and development impact fees. (e) Financing costs are not included in calculating developer profit. (0 The below market rate unit pdce is based on Santa Clara County’s median income for a four person household according to the Department of~ousing and Community Development. See Appendix U for an explanation of the BMR home price. Sources: RS Mean Square Foot Construction Costs, 2002; Ross Construction, 2002; Segue Construction; 2002; J.R.’Roberts Construction, 2002; Classic Communities, 2002; Dollars and Cents, Multifamily Housing, 2002; BAE, 2002. Appendix K: Small Site, 2.0 FAR Alternative-Reduced D EM LEO P MEN T$ U M M~R~-: % ;. ~ ~ .., :. ,;~ ~,~d~,~ ~:5~’~.~?" :~.~F: ~ ~:~! ~:~;~:~ , Development Program Number Unit Lot Size 10,500 Sq. Ft. Commercial Space BIdg, Sq. Ft. Retail Square Feet Bldg, Sq, Ft, Office Square Feet Bldg. Sq. Ft. Total Condominiums .14 Units@l,500 Sq. Ft. Each Residential Square Feet 21,000 Bldg. Sq. Ft. Residential Corridor Circulation 1,000 Bldg, Sq. Ft. Total Building Square Feet 22,000 Bldg. Sq. FL Parking Required Retail Parking 1 Sp/250 Sq. F~. Office Parking 1 Sp/350 Sq. FI. Residential Parking 1.5 Sp/Unit Spaces Parking Type Tuck-Under Alley Parking Partially Submerged Podium Par.king Underground Parking Spaces 21 21 HARD COSTS Item Number Unit Cost "Untt Site Area Improvements 10,500 Sq, Ft,$6 /Bq. Ft. Residential Building (a)22,000 Bldg. Sq, Ft..$152 /Bldg. Sq.F~. Underground Parking (c)9,500 Sq. Ft.$70 tSq. Ft. TOTAL 22,000 Bldg. Sq, Ft. SOFT COSTS Item Number Unit Cost Unit Architecture Fees $4,075,080 Engineering Fees $4,075,080 Defect Liability Wrap Insurance 1 Video Recording of Construction 1 Development Impact Fees and Buildinq Fees Development Impact Fees 14 BMR Fee $3,000,000 Building Fees Plumbing, Mechanical, and Electdc Building Fees Excavation Fees School Fees Residential Plan Check Fees Utility Fees Construction Financinq Costs Loan to Value Ratio Length oi~ Constructkion Period Drawdown Factor Construction Loan Rate Loan Fees Item Costs PricelUnit $63,000 $4,500 $3,347,080 $239,077 $665,000 $47,500 $4,075,080 $291,077 Total Hard Costs Total Hard Costs Project Project Units Appraised Apt Value (e) 22,000 Bldg. Sq. Ft.. $4.075,080 Total Hard Costs 14,500 Cubic Yards Item Costs Price/Unit 5% of Total Hard Costs $203,754 $14,554 2.5% of Total Hard Costs $101,877 $7,277 $420,000 $3 Million in Coverage $420,000 $30,000 $50,000 /Proiect $50,000 $3,571 $6,930 /Unit $97,020 $6,930 5% *Appraised Apartment Value $150,000 $10,714 $0.18 /Bldg. Sq.Ft.$3,960 $283 $5,892 + $3.85/additional $1,000 $18,042 $1,269 $2,000 + $100/additional 10,000 C.Y.$2,100 $150 2t 090 Living Area $2.14 /Sq. Ft. of Living Area 1 Project $33,882 /Project 1 Project $40,950 /Project $5,241,605 TolalValue 0,75 of Total Value I8 months $3,931,204 Total Loan 0.60 of Total Loan $3,931,204 Total Loan 7.5% of Total Loan/Year $3,931,204 Total Loan 1,5% of Total Loan $5,565,929 Har~ & Soft Costs 5% of Hard & Soft Costs $44,940 $3,210 $33,882 $2,420 $40,950 $2,925 $265,35~.$18,954 $58,968 $4,212 $276,296 $19,878 ¯ TOTAL SOFT COSTS $~,769,146 $126,368 DEVELOPER PROFIT $5,519,902 Hard & Soft Costs (d)10% ef Hard & Soft Costs (d)$551,990 $39,428 REVENUES and EXPENSES Number Unlt Price UBit Total Price/Unit RESIDENTIAL UNIT SALES Market Price 19,500 /Bldg, Sq. Ft.$500 l~ldg. Sq. Ft.$9,750,000 $750,000 Below Market Rate Uni! Pdce (e)1,500 /Bldg. Sq, Ft.$164 /Bldg. Sq. Ft.$245,388 $245,388 Brokerage and Marketing Expenses 5% of Potential Revenue ($499,769)($35,698) TOTAL RESIDENTIAL REVENUE $9~495~619 $678,258 Notes: (a) Assumes 1,500 square foot units with wood frame construction, high-quality construction, skylight, wood floors and full kitchen appliances. See Appendix S for a fuil unit detail (b) Assumes 452 square feet per space. (c) See Appendix T for a detail list of planning, building, and development impact fees. (d) Financing costs are not included in calculating developer prolit. (e) The below market rate unit price is based on Santa Clara County’s median income for a four person household according to the Department of Housing and Community Development See Appendix U for an explanation of lhe BMR home price. Sources: RS Mean Square Foot Construction Costs, 2002; Ross Construction, 2002; Segue ConstnJction; 2002; J.R. Roberts Construction, 2002; Classic Communities, 2002; Dollars and Cen s, Mu tram y Hous ng, 2002; BAE, 2002. Appendix L: Large Site, Existing Zoning Regulations (0.6 FAR) Development Program Number Unit Parking Required Spaces Lot Size 26,250 Sq. Ft.Retail Parking 1 Sp1250 Sq. Ft. Commercial Space 5,000 Sldg, Sq. Ft,Office Parking 1 Sp/250 Sq. Ft.20 Retail Square Feet Bldg: Sq. Ft.Residential Parking 2.1Sp/Unit+l Sp 16 OffiCe Square Feet .5,000 Bldg, Sq. Ft.. Total Condominiums 7 Units@l,425 Sq. Ft. Each Parking Type Spaces Residential Square Feet 9,975 Bldg. Sq. Ft.Surface Parking 36 Total Building Square Feet 14,975 Bldg. Sq. Ft.podium Par~ing Underground Parking HARD COSTS Item Number Unit Site Area Improvements 26,250 Sq. Ft. Commercial Construction (b)5,000 Bldg Sq. FL Residential Building (c)9,975 Bldg Sq. Ft, Surface Parking (dI 12,000 Sq. Ft, TOTAL 14,975 Bldg Sq. FL Cost Unit Item Costs $6 /Sq. Ft.$157,500 $90 /Bldg. Sq.Ft."’$450,000 $140 /Bldg. Sq.FL $1 396,500 $8 /Sq. Ft.$96,000 $2,100,000 Cost Unit Item Costs 5% of Total Hard. Costs $105,000. 2.5% of Total Hard Costs $52,500 SOFT COSTS Item Number Unit Architecture Fees $2,100,000 Total Hard Costs Engineering Fees $2,100,000 Total Hard Cgsts ¯ " Development Impact Fees and Buildinq Fees {e) Development Impact Fees Commercial 5,000 Residenti.al 7 BMR Residential In-Lieu Fee $2,042,381 Building Fees Plumbing, Mechanical, and Electric 14,975 Building Fees $2,100,000 School Fees Commercial 5,000 Residential 9,975 Plan Check Fees 1 Utility Fees 1 Construcfon Financinq Costs Loan to Valuff Ratio"$2,634,158 Length of Construction Period 8 Drawdown Factor $1,975,618 Construction Loan Rate $1,975,618 Loan Fees $1,975,618 Permanent Loan Fees $2,038,591 Project Contingency $2,738,507 TOTAL SOFT COSTS Bldg Sq, Ft.$18.75 /Bldg. Sq.Ft.$83,750 Units@l,425 Sq. Ft. Ea $6,930 /Unit $48,510 Appraised.Apt Value 5% *Appraised Apartment Vglue $102,119 Bldg Sq, Ft.$0.18 /Bldg. Sq.Ft. "$2,696 Total Hard Costs $5,892 + $3.85/additional $1,000 $10,237 Bldg Sq, Ft.$0.34 /Bldg, Sq.Ft.$1,700 Bldg Sq. Ft.$2.14 /Bldg. Sq,Ft.$21,347 Project $20,750 /Project $20,750 Project $75,550 /Project $75,550 Total Value 0.75 of Total Value months Total Loan 0,55 of Total Loan Total Loan.7.5% of Total Loan/Year $54,330 Total Loan 1.5% of Total Loan $29,634 Permanent Loan 1% of Permanent Loan $20,386 Hard & So~t Costs 5% of Hard & Soft Costs $136,925 $775,433 DEVELOPER PROFIT $2,771,083 Hard &.Soft Costs (e)12% of Hard & Soft Co~ts (e)$332,530 TOTAL CONSTRUCTION COSTS: REVENUES and EXPENSES OFFICE LEASING Monthly Lease Rate (NNN) Less Vacancy Monthly Operating Expenses " RESIDENTIAL LEASING Market Rent Monlhly Lease Rate Less Vacancy Monthly Operating Expenses TOTAL MONTHLY REVENUE Number Unit Price Unit Total 5,000 Bldg. Sq.Ft.$3.50 /Bldg. Sq. Ft.$17,500 10%of Potential Revenue ($1,750) 5,000 Sldg. Sq. Ft.($0.35)/Bldg. Sq, Ft.($1,750) 9,975 Bldg.Sq.Ft.$1.95 /Bldg. Sq. Ft.$19,451 5% of Potential Revenue ($973) 7 Units 25% of Potential Revenue ($4,863) 14,975 Bldg. Sq. Ft.$1.84 /Bldg. Sq. Ft.$27,616 NET ANNUAL REVENUE: Capitalized Value Estimate Net Adnual Revenue $331,391 Capitalization Rate 8% Total Capitalized Value $4,142,381 MinL~s Total Development Costs $3,207,963 LAND RESIDUAL VALUE $35.60 /Lot Sq. Ft,I’ "~’~ $934~419 Notes: (a) Assumes wood frame construction with tenant improvements included at $40 per square foot. Se~ Appendix S for a full unit detail. (b) Assumes 1,500 square foot units with wood frame construction, custom quality construction, skylight, and full appliances. (c) Assumes 333 square feet a space with landscaping. (d) See Appendix T for a detail list of planning, building, and development impact fees. (e) Financing costs are not inciuded in calculating developer profiL it) The estimated monthly unit expense rate is $3,600 per year. Sources: RS Mean Square Foot Construction Costs, 2002; Ross Construction, 2002; Segue Construction; 2~02; J.R. Roberts Construction, 2002; Classic Communities, 2002; Dollars and Cents, Multifamily Housing, 2002; BAE, 2002. Appendix M: Large Site, 1.15 FAR Alternative-Standard Parkin9 Development Program ’Number Unit Lot Size 26,250 Sq. Ft. Commercial Space 5,200 Bldg, Sq. Ft. Office Square Feet 2,500 Bldg. Sq. Ft. Retail Square Feet 2,700 Bldg, Sq. Ft. Total Condominiums 16 Units@l,500 Sq. Ft. Each Residential Square Feet .24,000 Bldg. Sq, Ft. Total Building Square Feet 29,200 Bldg. Sq. FL Parking Required Spaces Office Parking 1 Sp/250 Sq. Ft.10 Retail Parking 1 Sp/250 Sq. Ft.11 Residential Parking 2,3 Sp/Unit 37 Parking Type Spaces Surface Parking 4 Tuck-Under Alley Parking 15 Partially Submerged Podium Parking 39 HARD COSTS Item Number Unit Site Area Improvements 26,250 Sq. Ft. Residential Building (a)24,000 Bldg. Sq. Ft.. Commercial Building (b)5,200 Bldg. Sq. Ft_. Surface Parking (c)1,000 Sq. Ft. Tuck UnderAIley Parking (c)3,750 Sq. Ft. " Podium Parking (c)13,260 Sq. Ft. TOTAL . 29,200 Bldg. Sq. Fl. Cost Unit $6 /Sq. Ft. $150 /Bldg. Sq.Ft. $152 /Bldg. Sq.Ft. $8 /Sq. Ft. $3O /Sq. $45 /Sq. Ft. Item Costs $157,500" $3,601,200 $79O,4OO $8,000 $112,500 $596~00. $5,266,300 SOFT COSTS item Number Unit ArchiteCture Fees $5,266,300 Total Hard Costs Engineering Fees $5,266,300 Total Hard Costs Defect Liability Wrap Insurance 1 Project " Video Recording of Construction 1 Proiect " Development impact Fees and Buildinq Fees Development Impact Fees Residential .16 Units Commercial 5,200 Bldg. Sq. Ft.. BMR Fee $4,635,000 Appraised Apt Va]ue (e) Building Fees Plumbing, Mechanical, and Electric 29,200 Bldg. Sq. Ft. Building Fees $5,266,300 Total Hard Costs Excavation Fees 17,700 Cubic Yards School Fees Residential 24,000 Living Area Commercial 5,200 Bldg. Sq. Ft.. Plan Check Fees (d)1 Project Utility Fees (~)1 Project Construction Financinq Costs ¯ Cost Unit 5% of Total Hard Costs 2.5% of Total Hard Costs $420,000 $3 Million in Coverage $50,000 /Project $6,930 /Unit $18.75 /Bldg. Sq.Ft. 5% *Appraised Apartment Value $0.18 /Bldg. Sq.Ft. $5,892 + $3:85/additional $1,000 $2,000 + $100/addiSonal 10,000 C.Y. $2.14 /Sq. Ft. of Living Area $0.34 /Bldg. Sq.Ft. $41,154 /Project $82,350 /Project item Costs $263,315 $131,658 $420,000 $50,000 $110,880 $97,5OO $231,750 $5,256 $22,747 $2,100 $51,360 $1,768 $41,154 $82,350" Loan to Value Ratio $6,778,137 Total Value 0.75 of Total Value Length of Construction Period 18 months Drawdown Factor $5,083,603 Total Loan 0.60 of Total Loan Construction Loan Rate $5,083,603 Total Loan 7.5% of Total Loan/Year $343,143. Loan Fees $5,083,603 Total Loan 1.5% of Total Loan $76,254 Permanent Loan Fees $1 ,t67,668 Total Office Perm. Loan 1.0% of Office Loan $11,677 Project Contingency $7,209,211 Hard & Soft Costs 5% of Hard & Soft Costs $360,461 TOTAL SOFT COSTS $2,303,371 DEVELOPER PROFIT $7,138,597 Hard & Sof~ Costs (e)12% of Hard & Soft Costs (e)$856,632 TOTAL CONSTRUCTION COSTS: REVENUES and EXPENSES NQr~ber Unit Price Unit Total Prlce/Unlt RESIDENTIAL UNIT SALES MarketPrice 22,500 /Bldg. Sq. Ft.$515 /Bldg. Sq. Ft.$1t,587,500 "$772,500 Below Market Rate Unit Price (~1,500 /Bldg. Sq. Ft.$164 /Bldg. Sq. Ft:$245,388 $245,388 Brokerage and Marketing Expenses 5% of Potential Revenue ($591,644)($36,978) TOTAL RESIDENTIAL REVENUE $11,241,244 $702,578 COMMERCIAL LEASING Monthly Office Lease Rate (NNN)2,500 Bldg. Sq, Ft. Monthly Retail Lease Rate (NNN)2,700 Bldg. Sq. Ft. Less Vacancy Monthly Operating Expenses .5,200 Bldg. Sq. Ft. TOTAL COMMERCIAL LEASING REVENUE Annual Revenue COMMERCIAL CAPITALIZED VALUE $168,210 /Year $3.50 /Bldg Sq. Ft.$8,750 $3.25 /Bldg Sq. Ft.$8,775 10%of Potential Revenue ($1,753) ($0.34)/Bldg Sq. Ft.($1,755} $14,018 Capitalization Rate Capitalized Value 8% /Annual Revenue $2~102,625 TOTAL PROJECTVALUE {_ $13,343,869 J (a) Assumes 1,500 square foot units with wood frame construction, high-quality construction, skylight, wood floors and full kitchen appliances. See Appendix S for a full unit detail (b) Assumes wood frame construction on stucco. Tenants are ground floor restaurant and small office user. See Appendix S for building detail. (c) Assumes 250 square feet per space for surface parking & tuck under alley, and 340 square feet per space for podium parking. (d) See Appendix T for a detail list of planning, building, and development impact tees. (e) Financing costs are not included in calculating developer profit. (f) The below market rate unit price is based on Santa Clara County’s median income for a four person household according to the Department of Housing and Community Development. See Appendix U for an explanation of the BMR home price. Sources: RS Mean Square Foot Construction Costs, ~002; Ross Construction, 2002; Segue Construction; 2002; J.R. Robotic Construction, 2002; Cl~;ssic Communities, 2002: Dollars and Cenls, Multifan~ily Housing, 2002; BAE, 2002. Appendix N: Large Site, 1,1 5 FAR Alternative-Reduced Parking Development Program Number Unit Parking Required Lot Size 26,250 Sq. Ft.Office Parkiqg 1 Sp/350 Sq. Ft. Commercial Space 5,200 Bldg. Sq. Ft.Retail Parking 1 Sp/250 So. Ft. Office Square Feet 2,500 Bldg. Sq. Ft.Residential Parking 1.5 Sp/Unit Retail Square Feet 2,700 Bldg. Sq. Ft. To~al Condominiums 16 Units@l,500 Sq. Ft. Each Parking Type Resideniial Square Feei 24,000 Bldg. Sq, Ft.Surface Parking Total Building Square Feet 29,200 Bldg, Sq. Ft,Tuck-Under Alley Parking Partially Submerged Podium Parking Spaces Spaces 8 I1 24 15 24 HARD COSTS Item ’Number Unit Cost Unit item Costs Site Area Improvements 26,250 Sq. Ft,$6 /Sq, Ft.$157.500 Residential Building (a)24,000 Bldg, Sq. Ft.,$150 /Bldg. Sq,Ft.$3,601,200 Commercial Building (b)5,200 Bldg. Sq~ Ft..$152 /Bldg, Sq.Ft.$790.400 Surface Parking (c)1,000 Sq. Ft.$8 /Sq. Ft.$8,000 Tuck UnderAlley Parking (c)3,750 Sq. Ft.$30 /Sq. Ft.$112.500 Podium Parking (c).8,160 Sq. Ft.$45 /Sq, Ft.$367.200 TOTAL 29,200 Bldg. Sq. Ft,$5.036,800 SOFT.COSTS - Item Number Architecture Fees $5,036,800 Engineering Fees ’$5,036,800 Defect Liability Wrap Insurance ¯1 Video Recording of Construction Development Impact Fees and Buildinq Fee~ Development Impact Fees Residential 16 Commemial 5,200 BMR Fee $4,500,000 Building Fees Plumbing, Mechanical, and Electric 29,200 Building Fees $5,036,800 Excavation Fees 10,900 School Fees¯Residential 24,000 Commercial 5,200 Plan Check Fees 1 Utility Fees 1 Construction Financinq Costs Loan to Value Ratio Length of Construction Period Drawdown Factor Construction Loan Rate Loan Fees Permanent Lo~.n Fees Project Contingency TOTAL SOFT COSTS DEVELOPER PROFIT Unit Cost Unit item Costs Total Hard Costs 5% of Total Hard Costs $251,840 Total Hard Costs 2.5% 6f Total Hard Costs $125,920 Project $420,000 $3 Millionin Coverage $420,000 Project $50,000 /Project $50,000 Units $6,930 /Unit $110,880 Bldg. S~. Ft..$18:75 IBIdg. Sq.Ft,$97,500 Appraised Apt Value (d)5% *Appraised Apartment Value $225,000 Bldg. Sq, Ft.$0.18 /BIdg. Sq.Ft.$5,256 Total Hard Costs $5,892 + $3.85Iadditional $1,000 $21.838 Cubic Yards ¯$2,000 + $!00/additiona110,000 C.Y.$2,100 UvingArea $2.14 /Sq. Ft. of LivingArea $51.360 Bldg. Sq, Ft..$0.34 /Bldg. Sq.Ft.$1,768 Project $39,788 /Project $39,788 Project $82,350 /Project $82.350 $6,522,400 Total Value 0.75 of Total Value 18 months $4,891,800 Total Loan 0.60 of Total Loan $4,891,800 Total Loan 7.5% of Total LoanfYear $330,197 $4,891,800 T~tal Loan 1.5% of Total Loan $73,377 $1,167,668 Total Office Perm. Loan 1.0% of Office Loan $11.677 $6,937,650 H~rd & Soft Costs 5% of Hard & Soft costs $346.883 $2,247,733 $6,869,283 Hard & Soft Costs (e)12% of Hard & Soft Costs (e) TOTAL CONSTRUCTION COSTS: $824.314 REvENUEs and EXPENSES Number Unit Price Unit Total Price/Unit RESIDENTIAL UNIT SALES Market Price 22,500 /Bidg, Sq. FL $500 /81dg. Sq. Ft.$11,250.000 $750,000 Below Market Rate Unit Price if)1,500 /Bldg, Sq. Ft.$164 /Bldg. Sq. Ft.$245,388 $245,388 Brokerage and Marketing Expenses 5% of-Potential Revenue ($574,769)($35,923) TOTAL RESIDENTIAL REVENUE $10,920,619 $682.539 COMMERCIAL LEASING Mo~nthty Office Lease Rate (NNN)2,500 Bldg. Sq. Ft. Monthly Retail Lease Rate (NNN)2,700 Bldg. Sq. Less Vacancy Monthly Operating Expenses 5,200 Bldg. Sq. Ft. TOTAL COMMERCIAL LEASING REVENUEAnnual Revenue COMMERCIAL CAPITALIZED VALUE $168,210 /Year TOTAL PROJECT VALUE $3.50 /Bldg Sq. Ft.$8,750 $3.25 /BIdg Sq. Ft.$8,775 10%of Potential Revenue ($I,753) ($0,34)/S[dg Sq, Ft.($1,755) $14,016 Capitalization Rate Capitalized Value 8% /Annual Revenue $2,102,625 Notes: (a) Assumes 1,500 square foot units With wood frame construction, high-quality construcSen, skylight, wood floors and full kitchen appliances. See Appendix S for a full unit detail (b) Assumes wood frame construction on stucco. Tenants are ground floor restaurant and small office user. See Appendix S for building detail. (c) Assumes 250 square feet per space for surface parking & tuck under alley, and 340 square feet per space for podium parking. (d) See Appendix T for a detail list of planning, building, and development impact fees. (e} Financing costs are not included in calculating developer profit. if) ~he below market ~:ate unit price i~ based.on Santa Clara County’s media~ income for a four person household according to the Department of Housing and Community Development. See Appendix U for an explanation of the BMR home price. Sources: RS Mean Square Foot Construction Costs, 2002; Ross Construction, 2002; Segue Construction; 2002; J.R. Roberts Construction. 2002; Classic Communities, 2002; Dollars and Cents, Multifamily Housing, 2002; BAE, 2002. : ¯ Appendix O: Large Site, 1.5 FAR Alternative-Standard Parking Development Program Number Unlt Parking Required Spaces Lot Size 26,250 Sq. Ft.Office Parking 1 Sp/250 Sq. Ft.10 Commercial Space 5,200 Bldg, Sq. Ft.Retail Parking 1 Sp/250 Sq. FL 11 Office Square Feet 2,500 Bldg. Sq. Ft.Residential Parking 2.3 Sp/Unit 37 Retail Square Feet 2,700 Bldg. Sq. Ft. Total Condominiums 16 Units@l,500 Sq. Ft. Each Perking Type Spaces Residential Square Feet 24,000 Bldg, Sq. Ft.Surface Parking 4 Total Building Square Feet 29,200 Bldg. Sq. Ft.Tuck-Under Aley Parking 15 Partially Submerged Podium Parking 39 HARD COSTS Item ’Number Unit Cost Unit Item Costs Site Area Improvements 26,250 Sq. Ft.$6 /Sq. Ft.$157,500 Residential Building (a)24,000 Bldg. Sq. Ft..$150 /Bldg. Sq.Ft,$3.601,200 Commercial Building (b)5,200 Bldg. Sq. Ft..$152 /Bldg. Sq.Ft.$790,400 Surface Parking (c)1,000 Sq. Ft.$8 /Sq. Ft.$8,000 Tuck Under Alley Parking (c)3,750 Sq. Ft.$30 /Sq. Ft.$112,500 Podium Parking (c)13,260 Sq. Ft.$45 /Sq. Ft,$596,700 TOTAL 29,200 Bldg, Sq. Ft.$5,266,300 SOFT COSTS Item Number Unit Cost _ Unit Item Costs Architecture Fees $5,266,300 Total Hard Costs 5% of Total~iard Costs $263,315 Engineering Fees $5,266,300 Total Hard Costs 2.5% of Total Hard Costs $131,658 Defect Liability Wrap Insurance 1 Project $420,000 $3 Million in Coverage $420,000 Video Recording of Construction 1 Project $50,000 /Prcject $50,000 Development Impact Fees end Buildinq Fees fd) Development Impact Fees Residential 16 Units $6,930 /Unit Commercial 5,200 Bldg. Sq. Ft..$18,75 /Bldg. Sq.Ft. BMR Fee $4,635,000 Appraised Apt Value (e)5% "Appraised Apartment Value Building Fee~ Plumbing, Mechanical, and Electdc 29,200 Bldg. Sq. Ft.$0.18 /Bldg. Sq.Ft. Building Fees $5,266,300 Total Hard Costs $5,892 + $3,85iadditional $1,000 Excavation Fees 17,700 CubicYards $2,000+$100/addifonal 10,000 C.Y. School Fees Residenfal 24,000 LivingArea $2,14 /Sq. Ft. of LivingArea Commercial 5,200 Bldg. Sq. Ft.:$0,34 /Bldg. Sq.Ft. Plan Check Fees 1 Project $41,154 /Project Utility Fees 1 Project $82,350 /Project Construction Financinq Costs Loan to Value Ratio $6,778,137 Total Value 0.75 of Total Value Length of Construction Period 18 months Drawdown Factor $5,093,603 Total Loan 0.60 of Total Loan Construction Loan Rate $5,083,603 Total Loan 7.5% of Total Loan/year Loan Fees $5,083,603 Total Loan 1.5% or Total Loan Permanent Loan Fees $1,167,668 Total Office Perm. Loan 1.0% of Office Loan Project Contingency $7,209,211 Hard & Soft Costs 5% of Hard & Soft costs TOTAL SOFT COSTS DEVELOPER PROFIT $7,138,597 Hard & Soft Costs.(e)12% of Hard & Soft Costs (e) $110,880 $97,500 $231,750 $5,256 $22,747 $2,100 $51,360 $1,768 $41,154 $82,35O $343,143 $76,254 $11,677 $360.461 $2,303,371 $856,632 TOTAL CONSTRUCTION COSTS: REVENUES and EXPENSES RESIDENTIAL UNIT SALES Market Price Below Market Rate Unit Price (f) Brokerage and Marketing Expenses TOTAL RESIDENTIAL REVENUE Number Unit 22,500 /Bldg. Sq. Ft, 1,500 /Bldg. Sq. Ft. Price Unit Total PricelUnit $515 /Bldg, Sq. Ft.$11,587,500~$772,500 $164 /Bldg. Sq. Ft.$245,38~$245,388 5%of Potential Revenue ($591,644)($36,978) $11,241,244 $702,578 COMMERCIAL LEASING Monthly Office Lease Rate (NNN)2,500 Bldg. Sq. Ft. Monthly Retail Lease Rate (NNN).2,700 Bldg. Sq. Ft. Less Vacancy Monthly Operating Expenses 5,200 Bldg. Sq. Ft. TOTAL COMMERCIAL LEASING REVENUE Annual Revenue COMMERCIAL CAPITALIZED VALUE $168,210 /Year TOTAL PROJECT VALUE $3.50 /Bldg Sq. Ft.$8,750 $3,25 /Bldg Sq. Ft.$8,775 10% of Potential Revenue ($1,753) ($0.34) /BIdg Sq. Ft.($1,755) $14,018 Capitalization Rate Capitalized Value 8% /Annual Revenue $2,102,625 [ $1~,a4=,889 ] Notes: (a) Assumes 1,500 square foot units with wood frame construction, high-quality construction, skylight, wood floors and full kitchen appliances, See Appendix S for a full unit detail (b) Assumes wood frame construction on stucco. Tenants are ground floor restaurant and small office user, See Appendix S for building detail. (c) Assumes 250 square feet per space for surface and tuck under parking and 340 square feet a space for podium parking¯ (d) See Appendix T for a detail list of planning, building, and development impact fees. (e) Financing costs are not included in calculating developer profit. (0 The below market ~ate unit price is based on Santa Clera County’s median income fore four person household according to the Department el~ Housing and Community Development. See Appendix U for an explanation of the BMR home price. Sources: RS Mean Square Foot Construction Costs, 2002; Ross Construction, 2002; Segue Construction; 2002; J.R. Roberts Construction, 2002; Classic Communities, 2002; Dollars and Cents, Multifamily Housing, 2002; BAE, 2002. ,Appendix P: Large Site, 1.5 FAR Alternative-Reduced Parkin9 Developmen~ Program Number Unit Lot Size 26,250 Sq. Ft. Commercial Space 5,200 Bldg, Sq. Ft. Office Square Feet 2,500 Bldg, Sq. Ft, " Retail Square Feet 2,700 Bldg, Sq, Ft. Total Condominiums (a)22 Units Residential Square Feet 3~,600 Bldg. Sq. Ft, .Residential Circulation 1,500 Bldg. Sq, Ft. Total Building Square Feet 39,300 Bldg, Sq. Ft. Parking Required Spaces Office Parking 1 Sp/350 Sq. Ft,8 Retail Parking 1 Sp/250 Sq. Ft," 11 Residential Parking 1,5 Sp/Unit 33 Parking Type Spaces Surface Parking 4 Tuck-Under Alley Parking I5 Partially Submerged Podium Parking 33 HARD COSTS Item Number Unit Cost Unit Item Casts Site Area Improvements 26,250 Sq. Ft.$6 /Sq. FL $157,500 Residential Building (a)34,100 Bldg. Sq. Ft..$143 /SIdg, Sq,Ft.$4,869,480 Commercial Building (b)5,200 Bldg. Sq. Ft.,$152 /Bldg. Sq.Ft.$790,400 Surface Parking (c).1,000 Sq, Ft.$8 /Sq. Ft.$8 000 Tuck Under Alley Parking (c)3,750 Sq. Ft.$30 /Sq. Ft.$112,500 Podium Parking (c)11,110 Sq. Ft.$45 /Sq. Ft.$499,950 TOTAL 39,300 BIdg. Sq. Ft.$6,437,630 SOFT COSTS Item Number Unit Cost Unit Item Costs Architecture Fees $6,437,830 Total Hard Costs 5% of Total Hard Costs $321,892 Engineering Fees $6,437,830 Tota! Hard Costs 2,5% afTotal Hard Costs $160,946 Defect Liability Wrap Insurance 1 Project $420,000 $3 Million in Coverage $420,000 Video Recording of Construction 1 Project $60,000 ./Project $60,000 Development Impact Fees and Buildinq Fees Development Impact Fees Residential 22 Uniis $6,930 /Unit $152,460 Commercial 5,200 Bldg. sq. Ft,$1&75 /Bldg. Sq.Ft..$97,500 BMRFee $1,500,000 Appraised Ap( Value (d)5% *Appraised Apartment Value $75,000 Building Fees Plumbing, Mechanical, and Elecldc ~9,300 Bldg. Sq. Ft.$0,18 /Bldg, Sq.Ft.$7,074 Building Fees $6,437,830 Total Hard Costs $5,892 + $3,85/additional $1,000 $27,372 Excavation Pees 14,900 Cubic Yards $2,000 + $100/additional 10,000 C,Y.$2,100 School Fees Residential 32,600 LivingArea $2.14 /Sq. Ft, of LivingArea $69,764 Commercial 5,200 Bldg. Sq. Ft..$0,34 /Bl~g. Sq.FL $1,768 Plan Check Fees 1 Project $49,706 /Project $48,706 Utility Fees 1 Project .$88,550 /Project $88,550 Construction Financi~q Costs Loan to Value Ratio $7,970,962 Tota]Vafue 0.75 of TotalVafue Length of constructian Pedod 20 months Dra~down Factor $5,978,221 Total Loan 0.60 .of Total Loan C~nstruction Loan Rate $5,978,221 TotaILoan . 7.5% of TotalLoaWYear $448,367 Loan Fees $5,978,221 TotalLoan 1.5% of TotalLosn $89,673 Permanent Loan Fees $1,167,668 Total Office Perm. Loan 1,0% of Office Loan $11,677 Project Contingency $8,520,678 Hard & Soft Costs 5% of Hard & Soft costs $426,034 TOTAL SOFT COSTS $2,508,882 DEVELOPER PROFt:]"$8,396,996 Hard & Soft Costs (e)12% of Hard & Soft Costs (e)$1,007,639 TOTAL CONSTRUCTION COS’~8: ¯REvENuES and EXPENSES Number Unit Price Unit Total PrlcelUnit RESIDENTIAL UNIT SALES Market Price 30,000 /Bldg. Sq. Ft.$500 /Bldg, Sq. Ft.$15,000,000 $750,000 Below Market Rate Unit Price (e)2,600 /Bldg. Sq. Ft.$189 /Bldg. Sq. FL $490,776 $245,368 Brokerage and Marketing Expense~5% of Potential Revenue ($774,539)($35,206}TOTAL RESIDENTIAL REVENUE $14,716,237 $668,920 COMMERCIAL LEASING Monthly Office Lease Rate (NNN) Monthly Retail Lease Rate (NNN) Less Vacancy Monthly Operating Expenses TOTAL COMMERCIAL LEASING REVENUE 2,500 Bldg. Sq. Ft.$3,50 /Bldg Sq. Ft.$8,750 2,700 Bldg. Sq. Ft.$3.25 /Bldg Sq. Ft.$8,775 10% of’Potential Revenue (81,753) 5,200 Bldg. Sq. Ft.($0.34) /Bldg Sq. Ft.($1,755) $14,018 Capitalization Rate Capitalized Value 8% /Annual Revenue $2,102,625 ~18,6~8,~62.1 COMMERCIAL CAPITALIZED VALUE $168,210 /Year TOTALPROJECTVALUE Notes: (a) Assumes 20 units at 1,500 square feet and two units at 1,300 square feet with woad frame construction, high-quality construction, skylight, wood tioers and full kitchen appliances. See Appendix S for a full unit detail (b) Assumes wood frame construction on stucco. Tenants are graund fl~or restaurant and small office user. See Appen~Jix S far building detail. (c) Assumes 250 square feet per space for surface and tuck under parking and 340 square feet a space for podium parking. (d) See Appendix T for a detail list of planning, building, and development impact fees. (e) Financing costs arenot included in calculating developer profit. (f) The below market rate unit p~:ice is based on Santa Clara County’s median incame far a four person household according to the Depadment of Housing and Community Development. See Appendix U for an explanation of the BMR home price. Sources: RS Mean Square Foot Construction Costs, 2002; Ross Construction, 2002; Segue Constrt~ction; 2002; J.R. Roberts Construction, 2002; Classic Communities, 2002; Dollars and Cents, Multifami[y Housing, 2002; BAE, 2002. Development Program Number Unit Lot Size 26,250 Sq. Ft. Commercial Space 7,000 Bldg. Sq. Ft. Office Square Feet 4,000 Bldg. Sq. Ft, Retail Sauere Feet 3,000 Bldg. Sq. Ft. Total Condominiums (a)20 Units@ 1;500 Sq. Ft. each Re~idenlial Square Feet 30,000 Bldg. Sq. Ft. Residential Corridor Circulation 1,500 Bldg, Sq. Ft. Total Building Square Feet 38,500 Bldg. Sq" Ft. . Parking Required Spaces Office Parking 1 Sp/250 Sq. Ft.16 Retail Parking 1 Sp/250 Sq. Ft..12 Residen6al Parking 2,3 Sp/Unit 46 Parking Type Spaces Surface Parking 19 Partially Submerged Podium Parking 26 Underground Podium Parking 29 HARD COSTS Item Number Unit Site Area rnprovemen[s 26,250 Sq. Ft. Open Space Improvements 2,000 Sq. Ft. Residential Building (a)31,500 Sl~g. Sq. FL Commercial Building (b)7,000 Bldg. Sq. Ft. Surface Parking (c)4,750 Sq. Ft, PartiallySubmerged Podium Parking (c 7,700 Sq. Ft. Underground Parking (c)10,500 Sq. Ft. TOTAL 38,500 Bldg. Sq. Ft. SOFT COSTS Item Number Unit Architeclure Fees $7,107,575 Total Hard Costs Engineering Fees $7,107,575 Total Hard Costs Defect Liability Wrap Insurance 1 Project Video Recording of Construction 1 Project Development impact Fees and Buildinq Fees (d) Development Impact Fees Residential 20 Units Commercia:7,000 Bldg. Sq. FL Building Fees Plumbingl Mechanical. and Klectdc 38,500 Building Fees $7,107,575 Excavation Fees 26,600 School Fees Residential 30,000 Commercial 7,000 Plan Check Fees f Utility Foes 1 Construction Finaecinq Costs Loan lo Value Ratio $8,636,856 Length of Construction Period 20 Drawdown Factor $5,477,642 Construction Loan Rate $6,477,642 Loan Fees $6,477,642 Permanent Loan Fees $1,739,630 Project Confingency $9,237,240 TOTAL SOFT COSTS Bldg. Sq. Ft. Total Hard Costs Cubic Yards Cost Unit $6 /Sq. Ft. $20 /Sq. Ft. $150 /Bldg. Sq. Ft. $152 /Bldg. Sq. $8 /Sq. Ft. $45 /Sq, Ft. $70 /Sq. Ft. Cost Unit 5% of Total Hard Costs 2.5% of Total Hard Costs $420,000 $3 .Million in .Coverage $60,000 /Project Item Costs $157,500 $40,000 $4,726,575 $1,064,000 $38,OOO ¯$346,500 $735,000 $7,107,575 Item Co~ts Living Area Bldg, Sq. Ft. Project Project $6,930 /Unit $18.75 /Bldg. Sq. Ft. $0.18 /Bldg. Sq. Ft. $5,892 + $3.85/addiiional $1,000 $2,000 + $100/additional 10,000 C.Y. $2.14 ISq. Ft~ of Living Area $0.34 /Bldg. Sq, Ft. $52,485 /Project $88,150 /Project Toial Value 0.75 of Total Value monlhs Tolal Loan 0.60 of Tolal Loan Total Loan 7.5% of Total Loan!Year Total Loan 1.5% of Total Loan Tolal Office Porto. Loan 1..0% of Off~ce Loan Hard & Soft Costs 5% of Hard & Soft Costs DEVELOPER PROFIT $9,098,718 Hard & Soft Costs (e)12% of Hard &Soft Cesis (e) TOTAL CONSTRUCTION COSTS: $355,379 $177,689 $420,000 $60,000 $138,600 $131,250 $6,930 $30,019 $2,2OO $64,200 $2,380 $52,485 $88,150 $485,823 $97,155 $17,396 $461,862 $2,591,527 $1,091,846 REVENUES and EXPENSES Number Unit ¯Price Unit Total Price/Unit RESIDENTIAL UNIT SALES Market Price 27,000 IBIdg~ Sq. FL $515 /Bldg. Sq. Ft.$13,905,000 $772,500 Below Market Rate Unit Pdce (f)3,000 IBIdg. Sq. FI,$164 /Bldg. Sq. Ft,$490,776 $245,388 Brokerage and Marketing Expenses 5% of Potenfial Revenue ($719,789)($35,989 TOTAL RESIDENTIAL REVENUE $t3,675,987 $6~3,799 COMMERCIAL LEASING Monthly Office Lease Rate (NNN)4,000 Bldg. Sq. Ft.$3.50 /Bldg Sq. Ft.$14,000 Monthly Retail Lease Rate (NNN}3,000 Bldg. Sq. Ft.$3,25 /Bldg Sq. Ft.$9,750 Less Vacancy 10% of Potential Revenue ¯ ($2,375) Monthly Operating Expenses 7,000 Bldg. Sq. Ft.($0.34)/Bldg Sq. Ft.($2,363) TOTAL COMMERCIAL LEASING REVENUE $19,013 Annual Revenue Capitalization Rate Capltalized Value COMMERCIAL CAPITAL[ZED VALUE $228,150 /Year 8% /Annual Revenue $2,85t,875 TOTAL PROJECT VALUE [ $16,527,862 t Notes: (a) Assumes 1,500 square toot units with wood frame construction, high-quality construction, skylight, wood floors and full kitchen appliances. See Appendix S for a full unit detai (b) Assumes wood frame construction on stucco. Assumed tenant is a ground floor restaurant. See Appendix S for building detail. (c) Assumes 250 square feet per space for tuck under parking and podium parking, and 360 square feet per space for underground parking. (d) See Appendix T for a detail list of planning, building, and development impact fees. (e) Financing costs are not included in calculating developer profit. (0 The below market rate unit 3rice is based on Santa Clara County’s median income for a four person ~oL~sehold according Io the Department of Housing and Community Develocment. See Appendix U for an explanation of the BMR home pdce. Sources: RS Mean Square Foot Construction Costs, 2002; Ross Construction, 2002; Segue Construction; 2092; J.R. Robeds Construction, 2002; Classic Communities. 2002; Dollars and Cents, Multifamity Housing, 2002; BAE, 2002. Appendix R: Large Site, 2.5 FAR Alternative-Reduced Parkin9 Development Program Number Unit Lot Size 26,250 Sq. Ft. Commercial Space 5,550 Bldg: Sq. Ft. Office Square Feet 2,800 B!dg, Sq. Ft. Retail Square Feet 2,750 Bldg. Sq. Ft. Total Condominiums (a)33 Units Residential Square Feet -45,750 Bldg, Sq, Ft. Residential Circulation 2,000 Bldg. Sq, Ft. Total Building Square Feet 53,300 Bldg. Sq, Ft. Parking Required Spaces Office Parking 1 Sp/350 So. Ft.8 Retail Parking 1 Sp/250 Sq. Ft.11 Residential Parking 1.5 Sp/Unit 50 Parking Type Spaces Surface Parking 19 Partially Submerged Podium Parking 26 Underground Parking 24 HARD COSTS Item Number Unit Cost Unit Item Costs Site Area Improvements 26,250 Sq. Ft.$6 /Sq_Ft.$157,500 Residential Building (a)47,750 Bldg. Sq. Ft..$150 /Bldg. Sq.Ft.$7,176.348 Commercial Building (b)5,550 .Bldg. Sq, Ft.,$152 /Bldg, Sq.Ft.$843,600 Surface Parking (c) .4,750 Sq. FL $8 /Sq. Ft.$38,000 Podium Parking (c)7,700 Sq, Ft.$45 /Sq. Ft.$346,500 Underground Parking Icl 8,640 Sq. Ft.$70 /So. Ft.$604.800 TOTAL 53,300 Bldg. Sq. Ft.$9,166,748 SOFT COSTS Item Number Unit Cost .Unit Item Costs Architecture Fees $9,166,748 Total Hard Costs 5% of Total Hard Costs $458,337 Engineering Fees i9,166,748 Total Hard Costs 2.5% of Total Hard Costs $229,169 Defect Liability Wrap Insurance 1 Project $420.000 $3 Million in Coverage $420,000 Video Recording of Construction 1 Project $60,000 /Project $60,000 Development Impact Fees and Buildinq Fees (dl Development Impact Fees Residential 33 Commercial 5,550 BMR Fee $2,100,000 Buildihg Fees Plumbing, Mechanical, and Electdc 53,300 Building Fees $9,166.748 ExcavatioB Fees 23,800 School Fees Residential Commercial Plan Check Fees Utility Fees Construction Financinq Costs Loan to Value Ratio Length of Construction Period Drawdown Factor CgnstrUcflon Loan Rate Loan Fees Permanent Loan Fees Project Contingency TOTAL SOFT COSTS Units $6,930 /Unit $228,690 Bldg. Sq. Ft.,$18.75 /Bldg. Sq,FL $104,063 Appraised Apt Value (e)5% "Appraised Apartment Value $105,000 Bldg, Sq. FL.$0.18 fBIdg. Sq.Ft,$9,594 Total Hard Costs $5,892 + $3.85/additional $1,000 $38.152 Cubic Yards $2,000 + $100/additional 10,000 C.Y.$2,200 45,750 Living Area $2.14 /Sq. Ft. of Living Area $97,905 5,550 Bldg. Sq. Ft..$0.34 /BI0g. Sq.FL $1,887 -1 Project ¯$65,010 /Project $66,010 1 Project $90,750 /Project $90,750 $11,078,504 Total Value 0.75 of Total Vaiue 24 months $8,308,878 Total Loan 0.65 of Total Loan $8,308,870 Total Loan 7.5% of Total Loan/Year $810,116 $8,308,878 Total Loan 2.0% of Total Loan $166,178 $1,491,550 Total Office Perm. Loan 1.0% of Office Loan $14,915 $12,069,712 Hard & Soft Costs "5% of Hard & Soft Costs $603,486 $3,506,450 DEVELOPER PROFIT $11,681,989 Hard & Soft Costs (e)12% of Hard & Soft Costs (e)$1,401,839 TOTAL CONSTRUCTION COSTS;~:[-~’r~~]~’~’~~’~ REVENUES and EXPENSES RESIDENTIAL UNIT SALES Market Price Below Ma~rket Rate Unit Price. (0 Brokerage and Marketing Expenses TOTAL RESIDENTIAL REVENUE Number Unit 42,000 /Bldg. Sq. Ft~ 3,750 /Bldg. Sq. Ft. Price Unit Total Price/Unit $500 /Bldg, Sq. Ft.$21,000,000 $700,000 $196 /Bldg. Sq. Ft.$736,164 $245,388 5% o/Potential Revenue -($1,086,808)($32,934) $20,649,356 $625,738 COMMERCIAL ERASING Monthly Office Lease Rate (NNN) Monthly Retail Lease Rate (NNN) Less Vacancy Monthly Operating Expenses TOTAL COMMERCIAL LEASING REVENUE 2,800 Bldg. Sq.FL $3.50 /Bldg Sq. Ft.$9,800 2,750 Bldg. Sq. Ft.$3.25 /Bldg Sq, Ft,$8,938 10%of Potential Revenue ($1,874) 5,550 Bldg. Sq. Ft.($0.34)/Bldg Sq. Ft.($1,873) $14,991 Capitalization Rate Capitalized Value 8% /Annual Revenue $2,248,594 Annual Revenue COMMERCIAL CAPITALIZED VALUE $179,888 /Year TOTAL PROJECT VALUE I $22,897,950 I Notes: (a) Assumes 30 units at 1,400 square feet and three units at 1,250 square feet with wood frame high-quality construction, skylighL wood floors and full kitchen appliances. See Appendix S for a full unit detail. (b) Assumes wood frame construction on stucco. Tenants are ground floor restaurant and small office user, See Appendix S forbutlding detail. (c) Assumes 250 square feet per space for tuck under parking and podium parking, and 360 square feet per space for underground parking. (d) See Appendix T for a detail list of planning, building, and development impact fees. (e) Financing costs arenot included in calculating developer profit. (0 The below market rate unit price is based on Santa Clara County’s median income for a four person household according to the Depadment of Housing and Community Development. See Appendix U for an explanation of the BMR home #rice Sources:’ RS Mean Square Foot Construction Costs, 2002; Ross Construction, 2002; Segue Construction; 2002; J.R. Roberts Construction, 2002; C ass c Comm ~n ties. 2002; Dollars and Cents, Multifamily Housing, 2002; BAR. 2002. Homer Avenue Undercrossing (10121) Continuing -- Miscellaneous infrastructure APPENDIX F PROJECT DESCRIPTION This project consists of design and construction of a new pedestrian/bicycle grade-separated crossing of the Cakrain tracks approximately 800 feet south of the Palo Alto Caltrain station platform between the Palo Alto Medical Founda- tion and the Homer/Alma intersection. The project will provide access from the South of Forest Area (SOFA) residen- tial and commercial areas to the new Palo Alto Medical Foundation (PAMF) campus, to the Caltrain station, and to the new bike path constructed by PAMF along Urban Lane which is planned to be extended south to Churchill Avenue. By improving access to the major multi-modal hub the project will encourage and facilitate multi-modal trips. PROJECT JUSTIFICATION The need for a new pedestrian/bicycle crossing of the railroad tracks was identified during the review of the plan for the new PAMF campus. The approved PAMF campus plan includes an area to accommodate a pedestrian/bicycle access/ landing area for a future crossing and a cormection to the existing segment of the bike path built by PAMF on its cam- pus. In conjunction with the PAMF/SOFA Coordinated Area Plan study, a planning and feasibility study for the pedes- trian/bicycle crossing of the-Caltrain right-of-way in the vicinity of the Homer/Alma intersection was prepared. It is projected that approximately 1,600 to 1,800 pedestrians and bicyclists would use this facility daily. FUTURE FINANCIAL REQUIREMENTS : : PYBudget :~ 2001-02 2002-03 2003-04 2004-05 2005-06 AMOUNT $100,00o $2,550,000 CO~/I PONENTS Construction Sources of Funding: General Fund with the following reimbursements: TEA-21 ($2,200,000); Sheraton and Palo Alto Medical Foundation ($350,000) Homer Avenue Undercrossing (10121) continued ~iVIPACT AND SUPPORT ANALYSIS Environmental: Design Elements: Operating: Telecommunications: Environmental review will be required Project will be reviewed by CIP Design Consultant and is subject to Architectural Review Boardand Bicycle Advisory Committee review. Maintenance through Public Works Operations None COMPREHENSIVE PLAN This project furthers policy T-14 and program T-21 of the Comprehensive Plan 200}-03 IMPACT AND SUPPORT ANALYSIS E.nvironmental: Design Elements: Operating; Telecommunications: Environmental review wilI be required Pr.oject wiI1 be reviewed by CIP Design Consultant and is subject to Architectural Review Board and Bicycle Advisory Committee review. Maintenance through Public Works Operations None COMPREHENSIVE PLAN This project fm’thers policy T-14 and program T-21 of the Comprehensive Plan South of Forest Avenue (SOFA) Street improvements ~ (10402) New- Miscellaneous infrastructure PROJECT DESCRiPTiON. This project will implement traffic calming on Homer and Channing Avenues tO improve safety, and reduce conflicts. There may also .be a possible conversion of Homer and Channing and sections of High Street from one-way to two-way traffic flow, and changes to mid-block pedestrian crossings to improve visibility and safety. PROJECT JUSTiFiCATION The PAMF/SOFA, Coordinated Area Plan includes a number of policies to calm traffic and improve safety for pedestri- ans and bicyclists in the SOFA neighborhood. The plan calls for further study of converting Homer and Channing to two-way flow to make these street more in keeping with the residential character of the area. FUTURE FINANCIAL REQUIREMENTS FISCAL YEAR AMOUNT PY Budget 2001-02 2002-03 2003-04 $125,000 2004-05 $400,000 2005-06 Sources of Funding: General Fund COMPONENTS Design Implementation iMPACT AND SUPPORT ANALYSIS An environmental review may be required. Possible review by CIP Maintenance by Public Works Operations None Environmental: Design Elements: Operating: Telecommunications: COMPREHENSIVE PLAN This project is consistent with Policy L-67 Appendices G and H Appendices G and H are included for reference purposes only, and will be added later. All sections to be included in these appendices may be found in the Palo Alto Municipal Code. 9.30.02.FINAL SOFA CAP P&TC Version.doc i00 October 0i, 2002 Exhibit B DISTRICTS RT-35 Residential Transition 35’ RT-50 ~ RM-15 Residential Transition 50’ SOFA 2 RM-15 District PC R-2 RM-30 Planned Community District SOFA 2 R-2 District SOFA 2 RM-30 District FREEDMAN TUNG h BOTTOMLEY South of Forest Area District Map s:\Plan\Plsdiv\Lisa~Sofa\planning commission discussion_updl.pdf SOFA PHASE 2 Coordinated _,a~e a Plan Attachment C RESOLUTION NQ. RESOLUTION OF THE COUNCIL OF THE CITY OF PALO ALTO AMENDING THE LAND USE MAP OF THE PALO ALTO COMPREHENSIVE PLAN FOR THE AREA GENERALLY BOUNDED BY ALMA STREET, FOREST AVENUE, RAMONA STREET, AND CHANNING AVENUE (SOUTH OF FOREST AVENUE COORDINATED AREA PLAN,PHASE 2) AND ADDING ~COORDINATED AREA PLANS" TO THE LAND USE DEFINITIONS IN THE LAND USE AND COMI~TONITY DESIGN ELEMENT OF THE COMPREHENSIVE PLAN WHEREAS, the Planning Commission, after duly noticed public hearing, has recommended that the Council amend the Land Use Element of the Palo Alto Comprehensive Plan; and WHEREAS, the City Council has held a duly noticed public hearing on the matter, and has reviewed the contents of the Environmental Impact Report (~EIR") prepared for the project and all other relevant information, including staff reports, and all. testimony, written and oral, presented on the matter. ¯ NOW, THEREFORE, the Council of the City of Palo Alto does RESOLVE as follows: SECTION i. The City Council finds that the public interest, health, safety and welfare of Palo Alto and the surrounding region require amendment to the Land Use Map of the Palo Alto Comprehensive Plan as set forth in Section 2 hereof to implement Phase 2 of the South of Forest Avenue Coordinated Area Plan (the "SOFA 2 CAP") in accordance with Land Use Policy L-25 and Land Use Program L-22, and the related amendment of the land use definitions in Chapter Two. SECTION 2. The City Council hereby amends the Land Use Map of the Palo Alto Comprehensive Plan by changing the designation of the area depicted in Exhibit A to "South of Forest Area Coordinated Area Plan, Phase 2." Exhibit A is attached to this resolution and incorporated into it by this reference. SECTION 3. The City Council hereby amends the Land Use and Community Design Element of the Palo Alto Comprehensive Plan by adding a new section at the end of the Land Use Definitions Section, (page L-13) to read as follows: Coordinated Area Plans South of Forest Area Coordinated Area Plan Program L-22 directs the City to prepare a Coordinated Area Plan for the South of Forest Area 020926 syn 0091144 1 (SOFA) .and Palo Alto Medical Foundation (PAMF) site. The area is approximately 50 acres. Phase i Phase 1 was adopted in 2000, covering approximately 24 acres, including the PAMF site and adjacent area generally bounded by Waverley Street, Homer Avenue, Ramona Street, andChanning Avenue. It was implemented in part through a development agreement with PAMF. Phase 1 includes a public park, child-care center, and approximately 160 new units of affordable and market rate housing. Residential densities range from eight to fifty units per acre. Maximum floor area ratio for new structures is 1.5. Phase 2 Phase 2 was adopted in 2002.It covers approximately 26 acres generally bounded by Forest Avenue, Ramona Street, Addison Avenue, and Alma Street. Existing densities when the CAP was adopted were 8 to 260 units per acre. New development will usually range from 15 to 50 units per acre. Maximum non-residential FAR for new structures is 0.4; maximum total FAR is 1.5 or 2.0, with the higher FAR closer to Alma Street. SECTION 4. The City Council adopts this resolution in accordance with the California Environmental Quality Act (~CEQA") findings adopted by Resolution No. // // // // // // // // // // 020926 syn 0091144 SECTION 5. This resolution shall be effective upon the thirty-first (31st) day after its adoption to allow a complete and exclusive opportunity for the exercise of the referendum power pursuant to the Charter of the City of Palo Alto and the constitution of the State of California. A referendum petition filed after the effective date shall be rejected as untimely. INTRODUCED AND PASSED: AYES: NOES: ABSENT: ABSTENTIONS: ATTEST:APPROVED: City Clerk Mayor APPROVED AS TO FORM:City Manager Senior Asst. City Attorney Director of Planning and Community Environment 020926 syn 0091144 Working up Recommendations S UT A FO EA T CO0 T A P ASE 2 City of Palo Alto Department of Planning and Community Environment SOFA PLAN PHASE ll TABLE OF CONTENTS Chapter 1: Introduction ..........................................................................................1 B. C. D. Purpose of the Coordinated Area Plan .....................................................................................1 Relationship between the SOFA Cap and Other City Plans and Ordinances ..........................2 Relationship of SOFA to Downtown Commercial District .........................................................2 Organization of the CAP ...........................................................................................................2 Chapter I. Chapter II. Chapter III Chapter IV Chapter V Chapter VI Introduction ............................................................................................................2 Vision .....................................................................................................................2 Policies ...................................................................................................................3 Design Opportunities .............................................................................................3 Development Standards ........................................................................................3 Implementation ......................................................................................................3 Chapter 2: Vision ....................................................................................................3 Chapter 3: Policies .................................................................................................4 Land Uses (L) .................................................................~ ......................................................................4 General Land Use Policies ...........: ..................................................................................................4 Neighborhood-Serving Commercial Uses and Mixed-Use Development ........................................5 Neighborhood-Serving Commercial Use Policies ............................................................................5 Mixed-Use Policies ..........................................................................................................................6 Automobile and Other Service Uses ...............................................................................................6 ¯ Housing (H) ...........................................................................................................................................7 Housing Quantity and Density Policies ............................................................................................7 Variety of Housing Type Policies .....................................................................................................7 Affordable Housing Policies .............................................................................................................8 Transportation (T) ................................................................................................................................8 Trip Reduction ..................................................................................................................................9 Transit Oriented Development .......................................................................................................10 Parking Management ...................................................................................................................~. 10 Traffic Patterns ...............................................................................................................................11 Transit Service ...............................................................................................................................13 Bicycle Circulation .........................................................................................................................13 Pedestrian Circulation ....................................................................................................................14 Community Facilities (CF) .................................................................................................................15 Schools ..........................................................................................................................................15 Libraries .........................................................................................................................................16 Open Space/Public Facilities .........................................................................................................16 Design Character and Guidelines (DC) ............................................................................................17 Preserving Existing Buildings and Scale .......................................................................................18 Historic Preservation ......................................................................................................................18 Public Art ........................................................................................................................................20 Public and Private Trees (PPT) .........................................................................................................20 Street Trees and Heritage Trees Policies ......................................................................................20 Chapter 4: Section 4.10 4.10.1 4.10.2 4.10.3 4.10.4 4.10.5 4.10.6 4.10.7 4.10.8 4.10.9 4.10.10 4.10.11 4.10.12 4.10.13 Section 4.20 4.20.1 4.20.2 4.20.3 4.20.4 4.20.5 4.20.6 4.20.7 4.20.8 4.20.9 4.20.10 4.20.11 Design Opportunities .........................................................................21 Design Guidelines for Public Property ..................................................................22 Streets and Alleys ......................................................................................................22 Paseos and Alleyways ...............................................................................................22 Intersections ...............................................................................................................23 Gateways .............................................................................................: .....................23 Sidewalks ...................................................................................................................23 Pedestrian Amenities .................................................................................................23 Street Furniture ..........................................................................................................23 Crosswalks ........................................................................" .........................................24 Street Parking .............................................................................................................24 Landscaping ...............................................................................................................24 Lighting .......................................................................................................................24 Signage ......................................................................................................................25 Public Art ....................................................................................................................25 Design Guidelines for Private Property .................................................................25 Architecture ................................................................................................................25 Entrances ...................................................................................................................25 Height .........................................................................................................................26 Massing/Building Articulation .....................................................: ...............................26 Driveways ...................................................................................................................26 Fences and Walls .......................................................................................................26 Landscaping ................................................................................................................27 Lighting .......................................................................................................................27 Parking ......................" .................................................................................................27 Bicycle Facilities .........................................................................................................28 Art ...............................................................................................................................28 Chapter 5: Development Standards .................................................¯ ....................28 Land Use Designation Unique to SOFA II .....................................................................................28 5.1 Permitted Uses ...........................................................................................................28 5.2 Conditional Uses ................................................................................¯ ........................29 Site Development Regulations ..............................................................................: ....30 Landscaping ...............................................................................................................35 Bicycle Parking and Storage ......................................................................................35 Non-Conforming Uses/Non-Complying Facilities .......................................................36 5.14 Special Provisions ......................................................................................................36 Chapter 6: Implementation ...................................................................................37 A. Review Procedures ........................................................................................................................38 I) Permitted and Conditional Uses ..............................................................................................38 II) All Demolition, Alteration or Construction within Plan Area ....................................................38 III) Historic Resources ..................................................................................................................38 IV) Subdivisions, Parcel Maps and Other Land Divisions ............................................................39 B. Plan Amendments .........................................................................................................................39 Appendices ............................................................................................................39 Appendix A: Chapter 18.04 Definitions .......................................................................................39 Section 18.04.010 Purpose and Applicability ...............................................................................40 Section 18.04.020 General Rules for Construction of Language ..................................................40 Section 18.04.030 Definitions .......................................................................................................40 Editorial Notes: 1.The text in b!ue italics reflects preliminary decisions made by the Working Group at the last two meetings. The text in ~~:~ r~ italics reflects the minority working group opinion. This occurs in only one place regarding Planned Community Zone changes. 3. The text in pink italics reflects staff alternatives for consideration. iii Chapter 1" ~ntroduction A. Purpose of the Coordinated Area Plan The Coordinated Area Plan (CAP) is intended to create enhanced opportunities for building a sense of community through public involvement in planning processes that provide residents, businesses and property owners with early and meaningful opportunities to help shape the physical components of their neighborhoods and community. The South of Forest Area (SOFA) CAP was divided into two Phases because the overall 50 acre area contained two distinct sub-areas: those parcels that were primarily under one ownership and would be privately redeveloped simultaneously; and those parcels that were under separate ownership and would be privately redeveloped gradually over a long period of time. At the commencement of the first phase of the CAP process, the City Council appointed a fourteen member Working Group to represent the broader interests of the community and to develop a vision for the South of Forest Area. (ADD LANGUAGE HERE, WHICH ~L~PLAINS THAT SOFA !1 WORKING GROUP IS DIFFERENT THAN PHASE 1 GROUP), The same Working Group, without the owners of the Palo Alto Medical Foundation parcels, continued to participate in the second phase of the planning effort, which has resulted in the SOFA Phase 11 CAP. Phase 11 of the SOFA CAP is a long-term Plan that addresses a specific nine block area (approximately 19 acres) bounded by Forest Avenue on the north, Addison Avenue on the south, Alma Street on the west and Ramona Street on the east (See Map A). Although some of the goals and policies are the same for Phase 11 as Phase 1, the Phase 11 CAP is an independent document that does not rely on Phase 1 for its direction or implementation. It is a document that is intended to preserve the primary features of the existing character of an unique area within the City of Palo Alto. Figure ¯ (Put some of MIG’s sketches here and possibly photos) A major impetus for Phase 11 of the CAP preparation was the emergence of substantial new development in the commercial portions of the nine-block area. These new developments generally included commercial office and residential uses in denser developments than the existing automobile-oriented service uses, which previously dominated the area. High land values, high tech related employment growth, and the limited opportunity for growth in commercial districts throughout the downtown has fueled this development trend. These conditions are likely to result in continued development pressures in the area. Therefore, Phase 11 of the CAP specifies the appropriate land use pattern and intensity of development in the nine- block area and addresses such concerns as; compatibility of development with existing uses; parking; traffic; recreation/open space; architectural/design issues; development standards; the relationship between the SOFA Phase 11 area and the Downtown; and new land use designations. The City of Palo Alto SOFA II Area Map This map is a product of the City of Palo Alto GIS Relationship Between the SOFA CAP and Other City Plans and Ordinances The CAP augments the City of Palo Alto Comprehensive Plan and provides more detailed programs and policies for the specifically defined SOFA Phase 11 area. These policies and programs are consistent with those found in the Comprehensive Plan, but address the unique characteristics of the SOFA Phase 11 area. The CAP supplants Title 18, Zoning, of the Palo Alto Municipal Code (PAMC), unless otherwise noted, and includes the relevant development standards for the area in the text of the document (see Chapter V). C. Relationship of SOFA to Downtown Commercial District All of the SOFA II Plan area is subject to the development cap placed on non- residential development Downtown. Policy L-8 of the Comprehensive Plan limits ,the non-residential development in the Downtown area to 350,000 additional square feet above the square footage existing in May 1986. This limit will be reevaluated when development approvals reach 235,000 square feet of floor area. Downtown for the purposes of this program is considered to be the area currently zoned Commercial Downtown (CD) and the entire SOFA area (Phases 1 and 11). As of January 2002, a total of 116,000 square feet (33% of the additional square footage allowed) has been added to the Downtown area since 1986, leaving 234,000 square feet remaining under the cap. It is important to note that the SOFA II area is distinct from the downtown in that all but four parcels are outside the Downtown Parking Assessment District. Past land uses in the SOFA 11 area have not lent themselves to participation in the assessment district due to low development intensity, the physical and operational requirements of many service uses in the area, and the lower property values and associated rents relative to the downtown. Phase 11 is also outside the area subject to ground floor (GF) use restrictions such as those found along the primary streets downtown. Most of the uses in the SOFA 11 area have traditionally supported the uses downtown and the SOFA II area is not expected to compete with the downtown for type or intensity of land use. Map 1: Shows Downtown (CD-C(GF)(P) district boundaries, Parking Assessment District Boundaries and SOFA Phase II boundaries. D.Organization of the CAP The Coordinated Area Plan contains six chapters, which are described in more detail below. Chapter i, Introduction: contains the Purpose of a CAP, a brief description of the relationship between the two phases of the SOFA CAP and how the CAP relates to other City Plans and Ordinances, and outlines the organization of the document itself. Chapter II, Vision: provides the land use and development concepts for the area within Phase II of the CAP. Palo A! to SOFA II Boundary Downtown Parking Assessment District CD Zones Downtown Parking Assessment District and SOFA 11 0’100’ 500’ Chapter III, Policies: including Land Use, Housing, Transportation, Community Facilities, Design Opportunities, and Street Trees and Landscaping. All development proposals within the Phase 2 Plan area are required to be consistent with these policies and the associated development standards. Chapter IV, Design Opportunities: provides guidance regarding architectural and urban design encouraged in the Phase 2 area for public and private land. Chapter V, Development Standards: provides specific site development requirements. Chapter Vl, Implementation: includes an overview of the review process for development proposals and a process for considering exceptions to the development standards along with information about amending the CAP. Chapter !1 - Vision The vision identified by the Working Group for the SOFA 2 area is eclectic and diverse. It has six major components including: preserving and enhancing the existing pedestrian scale of the area and the walkable character of the quiet residential neighborhood immediately adjacent to the SOFA Phase 2 area; enhancing the neighborhood-serving character of the retail and service uses in the area; supporting physical change provided that new buildings and additions are compatible (see Development Standards section for definition of compatibie) and compliment the character of existing buildings; increasing housing opportunities, especially because of the proximity to the train station and downtown; preserving the existing quiet, calm streets, which are conducive to walking, and biking and calming the existing one-way streets; and supporting a mixture of uses including increased housing opportunities along with retail and small offices. The existing retail and commercial uses along Homer and Emerson Streets are highly valued and there is great support for preserving and enhancing these uses. There is an equally strong desire to decrease the general dependency on the automobile and take advantage of the area’s proximity to the downtown train station. The livability and the walkability of the neighborhood will be preserved and enhanced through the maintenance of pedestrian scale urban design improvements, the calming of traffic on area streets, and the creation of new housing for a variety of household types. Preserving and enhancing the existing streetscape is especially important and will be accomplished through application of the development standards and design guidelines presented in the Plan, which encourage design features and require building locations that facilitate interaction between the street and the pedestrian. The area’s traditional grid street pattern, pedestrian-oriented buildings, mature tree canopy, and mix of land uses will also be preserved. The Plan recognizes SOFA’s location near downtown and the train station and calls for higher density housing and other development in a vibrant mixed use area adjacent to the more intensive Alma Street Corridor and downtown areas and within walking distance of the train station. This concentration of higher density housing will also be within walking distance of the social opportunities and commercial services provided in the downtown. This vision is reflected in the Policies, Design Guidelines and Development Standards within the SOFA 2 Coordinated Area Plan. Chapter lii - Policies The following chapter includes policies for the SOFA 2 Plan Area related to land uses, housing, traffic and circulation, community facilities, design character and street trees and landscaping. These policies state the expectations for the area and provide direction to those responsible for reviewing proposed projects within the area. Land Uses (L) To achieve the community described in the Vision statement above, the Plan includes the opportunity for combined residential and commercial development. The increase in intensity will be predominantly higher density residential allowance. Working Group Recommendation: The Plan allows ~"esidentia/ development with a Floor Area Ratio (FAR) of up to !. 15,1, This total FAR can include a maximum commemia/ FAR of 4:1 (see Map entitled "Working Group Plan Concept"), At no time may the portion of the total FAR in commemial use exceed ~41 (except as noted for histonc and seismic structures in Sections 5, 3 (j) and (k) of this Plan), Staff Alternative: C~e Plan allows residential deve/opmer~t with a £/oor Area Ratio (FAR) of up to !, t5:1 in a majority of the area with an increase in the residential ~AR up to 1,5:1 in portions of the area closest to Alma Street with an approved Ptanned Comm.unity Zone change. T,~ese total densities can in.c/ude a maximum commercial ~4R o,~ .4:1 for a total FAR of I~ 15 in a majority of the area and a total FAR of 1,5 in the area closest to Alma Street, with an approved Planned Communit]~ zone change (see map entitled "Staff Recommendations" for locations), At no time may th, e portion of the total FAR in commemial use exceed .4:1 (except as noted for histodc and seismic structures in Sections 5.3(j) and (k) of this Plan), General Land Use Policies: POLICY L-1 : Promote varied residential development and neighborhood services while sustaining the character and vitality of the commercial and public facilities. POLICY L-2: Enhance desirable characteristics and uses by using planning and development standards to create, opportunities for neighborhood development. Encourage a compatible transition f/rom the residential neighborhoods to the downtown. Neighborhood-Serving Commercial Uses and Mixed-Use Development The distinct character of the SOFA area is created by its role in providing commercial services to the downtown area, such as auto repair, along with lower cost office space and convenient neighborhood-serving uses such as a grocery store, hardware store and restaurants~ The distinct character of the SOFA commercial and mixed use area is further enhanced by its role in serving downtown employees and visitors. The continuation of these uses will be encouraged due to their neighborhood serving functions. Some ground floor office use will remain as existing nonconforming uses but new office uses will be limited in square footage and to non-ground floor area along Homer and Emerson Streets, which are the primary retail streets in the area, Working Group recommendation: Similar office !imitations will also exist south of Homer Avenue (Section 5.3(h) of this Plan), Staff alternative: Ground floor !im.,itations on ~4oe of office use would not exist south of Homer Avenue. Size limitations would still app!y. Impacts from commercial uses and mixed-use residential projects will be reduced with the application of the development standards and design guidelines. Neighborhood-Serving Commercial Use Policies: POLICY L-3: Create an active commercial center for the South of Forest Area by encouraging neighborhood-serving businesses to locate along Emerson Street and Homer A venue. POLICY L-4: a) Encourage pedestrian activity along Emerson Street and Homer Avenue through uses that include retail, personal service and restaurants and prohibit new ground floor offices along Emerson Street and Homer A venue. b) Incorporate frequent building entrances, storefront windows, pedestrian-scale signage, and outdoor activity spaces into new development in the entire SOFA 11 area to create a lively, pedestrian-friendly environment. POLICY L-5: Permit existing commercial uses to remain. Encourage new neighborhood, and pedestrian oriented commercial uses in existing buildings and new mixed-use development. Phase II of the SOFA Plan anticipates that the commercially zoned area in SOFA will become much more of a mixed use area containing substantial amounts of residential development next to or combined with office and commercial uses. This type of development is strongly encouraged in the City’s 1998-2010 Comprehensive Plan as an. opportunity to create neighborhoods that are made more interesting and livable by providing the following: 1) a variety of activities taking place; 2) the ability to be active both day and night; 3) the opportunity for a rich texture of architectural and urban design; and 4) the easy accessibility of commercial service to residents and employees of the area. The land use and Zoning designation applied to the Phase II area is designed to result in the development of substantial quantities of housing. So long as great care is given in project design to ensure compatibility between residential and other uses, the area is considered an appropriate location for higher density residential development. By concentrating future neighborhood serving businesses in the Phase II area, the vitality of the existing hub will be reinforced and a wider array of services will be possible. While the Plan does not absolutely require commercial uses along Homer Avenue and Emerson Street, it does provide opportunities for small scale neighborhood serving retail and commercial uses with reduced parking requirements to reflect their relianc’e on pedestrian access and the constraints of reusing historic buildings. Design guidelines presented in Chapter IV and Development Standards presented in Chapter V require transparent storefronts or window displays, frequent entries, and other measures to increase visual appeal for pedestrians, regardless of the use of these properties. The economic analysis for the plan cautioned that the market for retail and service uses in the area is limited due to the proximity of the area to Downtown and the limited neighborhood population. However, the market for neighborhood local retail and service uses will improve with the private redevelopment facilitated by the Plan due to increased number of residents and employees in the area. Residents have expressed the desire to maintain and encourage additional local serving commercial uses in the area. Therefore the plan allows for that type of development. Mixed-Use Policies: POLICY L-6: Enhance the vitality and fivability of the South of Forest Area by allowing a mixture of residential and neighborhood serving commercial land uses. This plan provides development standards and design guidelines to facilitate in-fill residential and mixed-use development while continuing a broad range of compatible service commercial uses within the SOFA area and by incorporating measures to reduce noise, visual and other conflicts between such uses, which include auto-related uses. The responsibility for ensuring compatibility with legal existing land uses and activities shall be placed on new development, and not existing uses. The Plan also provides opportunity for housing production in mixed use development by allowing additional floor area for housing in a mixed use, commercial and residential, project thus encouraging housing and employment near downtown transit and services. (See Chapter V, Development Standards). Automobile and Other Service Uses The long-standing presence of several automobile and other service uses in the area is very valuable to the City. The presence of these business uses is a great convenience to local residents and downtown workers, and opportunities to locate such uses are limited in the rest of the City. The recommendation of the SOFA 2 working group regarding automotive services is to continue to allow existing automobile and service uses in the area but to limit new automotive uses to Alma Street and the west side of High Street, with conditional use permits to ensure compatibility with surrounding land uses. Assuming that all the activities at the existing automobile and service uses are operating legally, the responsibility for resolving issues that arise from incompatible land uses locating on adjacent properties will rest with new development. However, new automobile or other service uses will also be responsible for addressing compatibility issues. POLICY 1-71 Enhance the character of the South of Forest Area by ensuring that new residential development is compatible with existing residential areas and incorporates measures to minimize potential nuisance conflicts with existing commercial land uses, Housing (H) The City of Palo Alto is confronted with a well-documented phenomenon related to the continually rising cost of housing. Phase II of the SOFA Plan seeks to provide for more modest homes through the provision of less expensive, attached housing units in residential and mixed use projects. Phase II also addresses the well-documented need for "affordable" housing in Palo Alto special provisions for certain types of housing such as single room occupancy (SRO) facilities or senior housing facilities. The area within Phase II of SOFA provides increased housing opportunities convenient to shops, services, and transit. The Comprehensive Plan recommends the creation of a substantial number of new residential units near the downtown, responding to the city’s housing shortage and the area’s proximity to transportation opportunities. The concentration on residential uses maintains the overall character of this area and helps create the transition to lower density residential areas to the east and south. A considerable amount of discussion occurred within the Advisory Group regarding the location and placement of higher density residential uses within the Phase 2 area. The original goal for both the SOFA I and 2 areas was to provide approximately 300 new housing units total. Maximum build-out of the densities allowed in the SOFA 2 plan, in addition to the housing being constructed in the SOFA 1 area, would exceed the original goal. Housing Quantity and Density Policies: POLICY Within the SOFA area, Phases 1 and 2, provide for a total of 300 residential units and promote the retention of existing housing units and encourage the development of new housing units throughout the South of Forest Area. POLICY H=2: Use the SOFA Phase II area as a transition between the existing single-family uses south of the Phase II area and the commercial uses in the downtown area north of the Phase II area by providing opportunities for medium density multiple family housing within the Phase II area. POLICY H=3: Provide for increased residential densities including additional lower cost ownership and rental housing within traditional historic housing types. Variety of Housing Type Policies: POLICY Allow a variety of housing types in the Phase II SOFA area, including, but not limited to, the following: units in a mixed-use configuration; apartments; townhouses; and studio units. Variety of Housing Types POLICY HoS: Housing types in the plan area should be suitable for various ages, household sizes, lifestyles and incomes. Phase II of the SOFA plan includes a range of housing options, including mixed use housing, apartments, condominiums, and affordable housing to enable new residents the benefit of being in an area with convenient access to downtown, jobs, transit and services. Affordable Housing Policies: Provision for the allowance of affordable housing is incorporated into Phase II of the CAP pursuant to the current Below Market Rate housing program. POLICY H-6: Preserve existing affordable housing opportunities within the South of Forest Area and expand the supply of affordable housing units. PROGRAM H- 1: When appficable, negotiate Below Market Rate (BMR) agreements with property owners to comply with Program H-20 of the Comprehensive Plan. Program H-20 of the Comprehensive Plan sets forth priorities for compliance with the Below Market Rate (BMR) program by developers. The primary objective of this BMR program is: ’to obtain actual housing units or buildable parcels within each development rather than off-site units or in-lieu payments". Palo Alto’s Below Market Rate Housing program requires all developers of projects of more than 10 units to develop at least 10% of the units using specific affordability criteria. Sites exceeding 5 acres are required to provide 15% BMR units. These requirements are subject to change depending upon the outcome of the Comprehensive Plan Housing Element update. POLICY hi=Z: Strongly encourage retention of existing housing, particularly traditional housing structures, rental and other housing that is affordable in an area where land and construction costs have made this retention difficult. POLICY hi-8: Increase the possibility of developing housing in a mixed-uSe configuration by making residential development standards more compatible with existing non-residential development standards. Projects including affordable housing are required to meet the same development standards and design guidelines as market rate housing projects and are required to incorporate design features to ensure compatibility with the SOFA area. Transportation (T) The SOFA area offers an unusually varied set of transportation options. A traditional grid street pattern with a mixture of uses and moderately dense, pedestrian-oriented residential and commercial development helps to support alternatives to automobile use. Walking and bicycling within the area on flat tree-lined streets is pleasant and convenient. The bicycle boulevard passes through the Phase II Plan Area on Bryant, and part of the segment of Addison Avenue that passes through the Plan Area has a designated bike lane. Bus and train service is within a fifteen-minute walk of the outer boundaries of the Plan Area and provides transportation throughout the Peninsula, South and East Bay. A one-way street couplet including Homer and Channing Avenue has facilitated heavy through-traffic across the Plan Area to the major sub-regional arterials of Middlefield and Alma. This roadway system has provided good automobile access but has also resulted in relatively higher volumes and increased speed of traffic. This topic is discussed in more detail in the "Traffic Patterns" section of this Piano The policies in this chapter address six transportation issues in the SOFA II area. These include trip reduction, transit oriented development, parking management, traffic patterns, transit service, and bicycle and pedestrian circulation. 1. Trip Reduction Encouraging use of the many alternatives to automobile access in the Phase II SOFA area is the single most effective way to reduce transportation impacts on the area while providing safe and convenient access. The area has excellent transit, bicycle and pedestrian access, and proximity to a variety of retail, employment, housing opportunities, and community facilities. Reinforcing the mixed land use pattern will increase the viability of transportation alternatives and reduce the need for automobile use. These efforts need to be coordinated with comprehensive downtown transportation management efforts to be fully effective. POLICY T-I: Reduce vehicle use in the Downtown and SOFA II area, where development patterns support transportation alternatives such as walking, biking and transit use. PROGRAM T-l: Through the Transportation Division, coordinate SOFA II Plan area trip reduction efforts with Downtown trip reduction efforts, including shuttle service, transit service and other projects. POLICY T-2: Provide 5% reductions in commercial parking requirements for developers who complete all of the following: 1) require commitments from all commercial tenants to provide financial incentives to employees for not driving to work or who participate in the Santa Clara Valley Transportation Authorities Eco-Pass free transit program or commuter check program, 2) pay annual fees to support Downtown/SOFA II Transportation Management programs and monitoring by the City, and 3) submit annual monitoring reports to the City on implementation of these incentives and employee travel behavior. PROGRAM T-2: Support the continuation of a full time City of Palo Alto Transportation Management Coordinator for the downtown area (including SOFA II), with responsibility for promoting trip reduction efforts, reviewing requests for parking reductions based on Transportation Demand Management (TDM) plans, and monitoring the success of trip reduction programs based on data provided by SOFA and downtown employers° The coordinator would develop guidelines for approval of parking management, employee trip reduction incentives, and other programs proposed by developers and tenants of mixed use and other projects within the Plan Area. In Silicon Valley and other Bay Area locations, financial incentives that pay employees cash for not driving to work, or provide credits toward transit or bicycling costs, have been shown to reduce auto use by 15-30% depending on the size of the cash incentive. 2. Transit Oriented Development POLICY T-3: Pursuant to the 1998-2010 Comprehensive Plan, encourage transit-oriented development by allowing greater housing density in areas located nearest to major transit routes providing access to housing and employment centers. Working Group Alternative. The SOFA 2 Plan allows residential development with a Floor Area Ratio (FAR) of up to. 1,5: !, This FAR can include a commemial FAR of 4: ! for a total F~AR of 1, 15:t on a site in the SOFA 2 area. At no time may the portion of the total FAR in commemial use exceed ,4:t, This combined devek:~pment potential locates both housing and jobs within walking distance of the Pale Alto CafT?ain Station and regional bus mutes such as the Dumbar-ton Express~ Mixed use. transit oriented development of this type will increase the amount of housing and employment located close to major transit services, increasing the attractiveness of bansit throughout the region, Staff Alternative: The floor area ratio may be increased to 1.5:! along por,.*ions of Alma and High Streets, with an approved PC zone change, which fu,dher increases the potential for bringing housing and employment close to major transit services At time may t,~e po~fion of the total FAR in commercial use exceed .4: ! 3. Parking Management Presently, there is a parking shortage at peak periods in the downtown and SOFA, which in turn affects adjacent residential areas. This demand is predominantly generated by downtown and SOFA visitors and employees, and by SOFA residents. The shortage will be reduced When the two proposed downtown parking structures are constructed (expected completion for the garage on High Street (Lot R) is late Spring 2003 and ,for the garage on Bryant Street (Lots S and L) is Winter 2003). Phase 2 of the SOFA Plan addresses the parking shortage by requiring that all new development provide onsite parking and share parking facilities where appropriate. The relocation of the Pale Alto Medical Foundations (PAMF), and some existing commercial development in the Phase I area of SOFA, combined with new development that provides adequate parking is anticipated to ease the parking shortage in the area. Phase 2 of the SOFA plan provides for limited reductions in parking when appropriate conditions exist (i.e., when a project can utilize shared parking for different uses with different peak demand periods or it is within walking distance of the transit station, or it provides all affordable or senior housing units, etc.). [0 POL/CY T-4: Encourage shared parking for all uses with different peak hour parking demands and provide parking reductions of up to 20% for mixed-use projects with a housing component that have shared parking facilities and offset peak hour parking needs, and parking reductions of up to 15% for projects with multiple commercial uses that have shared parking facilities and offset peak hour parking needs. Uses with offset peak parking needs can share parking facilities, resulting in lower land and construction costs for parking, and less visual impact of parking lots and structures. This policy will be implemented through an existing City regulation that allows a 20% reduction in the number of spaces that would otherwise be required for each use separately. For mixed-use projects combining housing with retail and office uses with offset peak requirements, this reduction could be up to 20%. If a project proposes incentives for trip reduction that will further reduce parking demand, such as employee transit passes or separate charges for residential or employee parking spaces, the maximum reduction of 25% could be approved. POL/CY T-S: Reduce impacts on residential areas adjacent to the SOFA Phase 21 area from the parking impacts of the downtown area and the SOFA mixed use area by encouraging shared parking facilities and below grade parking. POLICY Decrease the adverse visual impacts of surface parking and street level parking garages by encouraging parking for mixed use and multi-family residential parking to be either underground or otherwise not visible from adjacent roadways through the use of landscape screening. Allow parking reductions and flexibility for historic buildings to avoid conflicts between preservation and provision of parking. POLICY Encourage an increased amount of short-term on-street parking for retail and commercial uses. 4. Traffic Patterns The Plan Area is effected by Downtown and through traffic as well as neighborhood- generated traffic. For several decades, Homer and Channing Avenues have formed a one-way couplet three to four blocks south of University Avenue. As a result of the one-way designation, Homer and Channing Avenues are attractive opportunities to bypass downtown at higher speeds than the two way streets closer to Downtown, such as Forest Avenue. The fast-moving traffic on Homer and Channing Avenue is a safety issue for pedestrians, bicyclists and vehicles attempting to exit the driveways of single-family homes. Residents along Homer Avenue have expressed the concern that the volume and speed of traffic along the street conflicts with safe and convenient exiting from their driveways. Exiting these driveways requires backing into the fast-moving traffic stream, which can be hazardous. Consideration was given to returning these streets to two-way flow in order to calm traffic and be more in keeping with the residential character of the area. Returning the streets to two-way travel will affect circulation around the commercial uses in the portion of the Plan Area closer to Alma Street as well as outside the Plan area. Truck access to various commercial uses frequently requires wide turning movements that can be more easily accommodated on one-way streets. Deliveries to Whole Foods Grocery Store and other nearby commercial uses, are often accomplished by trucks double-parking along Homer Avenue which blocks one traffic lane. Trucks parked in this area can also block a driver’s view of pedestrians crossing mid-block to the Whole Foods parking area. Additional concerns were also raised by the residents of the Channing House, located just outside the plan area, regarding their ability to safely enter and exit the underground parking garage. The Working Group endorsed the conversion of Homer and Channing Avenue and a portion of High Street from one-way to two-way traffic flow, with the caveat that this conversion should not adversely affect the needs of Whole Foods and the Channing House. This issue will require further analysis, which will be conducted at a future date. It should be noted that traffic calming measures could be implemented whether Homer and Channing Streets remain one-way or become two-way streets. The City of Palo Alto Five Year Capital Improvement Program (CIP) calls for street improvements and traffic calming measures such as speed tables and bulb-outs along Homer and Channing Avenues. In addition, the CIP project includes bike boulevard improvements, street furniture, and ADA compatible improvements. These improvements are scheduled for construction in fiscal year 2004/05. Phase 2 of the SOFA plan is consistent with the City of Palo Alto’s CIP in that the Plan encourages further study of traffic calming measures, which could include: pedestrian bulb-outs, traffic lane narrowing and conversion to two-way flow. Map 2, Existing Traffic Patterns and Map 3, Potential Traffic Patterns POL/CY T=8: Study ways of calming traffic on Homer and Channing Avenues that could include, but not be limited to, pedestrian bulb-outs, traffic lane narrowing or conversion to two-way flow. Consider converting a portion of High Street to a two=way traffic circulation pattern where appropriate. POLICY T-9: Complete further research on the possible installation of a traffic signal and signing improvements ff Homer, Channing and a portion of High Street are converted to two way traffic flow. These improvements could include a new signal at Channing and Alma and a southbound left turn lane on Alma at Channing. Coordinate these changes with the improvements to loading and delivery access described below. POLICY T- 10: Assist Phase 2 SOFA businesses in finding safe and convenient ways to accommodate truck deliveries which may be affected by change if the one way street pattern is converted to a two-way pattern. POLICY T=I 1: Future study of the conversion of Homer and Channing Avenues should address the concerns raised by Whole Foods and Channing House, as described in Programs T-3 and T-4 below, in addition to the need for signals and turn lanes on Alma Street. Sofa II The Ci y of Palo Alto MAP2 Sofa II Existing Traffic Patterns This map ~s a produot of the City of Palo Alto GIS 650’ ISOFA II Sofa II Boundar Thc Cily of Palo Alto MAP3 Sofa II Potential Traffic Patterns This map is a produot of the City of Palo Alto GIS 650’ PROGRAM T-3: Coordinate with Whole Foods to reduce current and potential future conflicts of truck loading with two-way traffic on Homer Avenue. These changes may include but not be limited to the addition of loading zones on Homer Avenue and Emerson Street, restrictions in loading hours, increased use of the alley between Homer and Forest, or the evaluation of the redesign of loading facilities within the store. PROGRAM T-4: Coordinate with the Channing House residents, as part of a future Transportation Division study, to improve safety and reduce conflict between trucks loading, traffic on Homer Avenue and residents entering and exiting the parking facilities. POLICY T=12: Support necessary and appropriate changes to mid-block pedestrian crossings, including relocation of crossings to nearby intersections, raised pavement, signing to assure that crossings are visible to passing traffic and convenient and safe for pedestrians. 5. Transit Service Transit service within the Phase 2 Plan Area is fairly good by Peninsula standards, with a heavily used commuter rail station within 3 to 12 blocks of any part of the Plan Area, a regional express bus to the East Bay, and two local services through the Plan Area, with several others through the nearby downtown area. More frequent daily service and evening and weekend service would increase convenience for transit users. The Marguerite shuttle to Stanford comes within one block of Forest Avenue. The 1998-2010 Comprehensive Plan also calls for the provision of a shuttle/jitney type bus system to serve Palo Alto. This program has been implemented and provides a shuttle service that travels within close proximity of SOFA along Webster Street. Implementation of this program reduces traffic and parking demands in this area by providing an alternative to driving. Ridership is generally low on all transit except rail and East Bay bus service, suggesting most residents, employees and visitors have cars available and find few incentives to use public transportation services. Studies show housing and employment near transit and incentives such as free transit passes can increase transit use and discourage auto use; such efforts are supported and encouraged in the Phase II SOFA Plan. POLICY T-13: In coordination with Downtown efforts, encourage transit use by SOFA residents, employees and visitors, increasing awareness of available transit service and schedules and working with Santa Clara Valley Transportation Authority (SCVTA), SamTrans, Stanford, and other transit providers to improve service. Circulation Bicycling is a convenient transportation method for residents, employees, and visitors to SOFA and those who travel through the area to nearby destinations. Bryant Street is a bicycle boulevard and Addison Avenue is a bicycle route between Bryant and Guinda Street. The Alma Street sidewalk is currently designated as a sidewalk and bicycle path, but this designation will be removed in the future as planned bike routes are developed. Bicyclists can cross under Alma Street and the railroad tracks using sidewalk bicycle paths at University Avenue and Embarcadero Road. Access to both existing undercrossings is inconvenient. In addition, crossing the railroad tracks and El Camino Real at University Avenue is complex and can be hazardous. A new undercrossing of the railroad tracks at Homer Avenue and Alma Street will be constructed by the City of Palo Alto to correct the existing situation. In addition, Homer Avenue is recommended to be designated a bicycle boulevard in the Draft Bicycle Transportation Plan. The new undercrossing would involve the construction of a bicycle and pedestrian tunnel under the railroad right-of-way that would connect the area around the Palo Alto Medical Foundation (PAMF) with the SOFA and Downtown areas. Entry/exit features would be constructed on the Alma Street side and at the PAMF side of the railroad tracks. Both entry/exit features would be setback from the street on the Alma side and from bicycle paths on the PAMF side. Stairways and ADA compliant ramps would be integrated with new landscaping at the access points to the tunnel. The tunnel would also incorporate lighting features and design enhancements to promote safety and reduce the perception of the tunnel as a long, dark enclosed corridor. Feasibility and design studies for the undercrossing are included in Appendix _ of this document (to be added later). MAP 4 - Existing and Proposed Bicycle Routes POLICY T-14: Provide safe and efficient bicycle routes consistent with the proposed bike/pedestrian undercrossing of the railroad tracks. These routes should provide connections between the SOFA, Downtown, and nearby schools, shopping centers, transit centers and employment centers. PROGRAM Revise bicycle routes in the Plan Area to provide a bicycle route between the Bryant Street "bike boulevard" and Alma Street using Homer and/or Channing Aven’ue, or as otherwise recommended by the Palo Alto Bicycle Advisory Committee (PABAC), to connect with the proposed pedestrian bicycle undercrossing at Homer Avenue and Alma Street. Further study of an alternate route is needed if Homer Avenue remains one-way between Alma and Ramona Streets. POLICY T= 15: Support the construction of a bicycle/pedestrian undercrossing at Homer Avenue and Alma Street. Facilitate implementation of the recommendations of the Railroad Crossing Feasibility Study to improve pedestrian access from SOFA to the PAMF campus and points west. 7. Pedestrian Circulation Pedestrian access throughout the South of Forest Area is good, with a regular pattern of small blocks. In the commercial areas towards Alma Street, the attractiveness of the pedestrian experience is diminished by areas of narrow sidewalks, missing or stunted street trees and by heavy and fast-moving traffic on Alma Street. Heavy, fast traffic on Homer and Channing Avenue also impacts pedestrians despite wider sidewalks and large street trees. To improve the safety and circulation of pedestrians and contribute to a walkable neighborhood, Phase II of the SOFA Plan encourages traffic calming improvements at key intersections within the plan area. 14 Proposed Legend % Bike Boulevard Bike Route Bike Lane Bike Path Bike/Ped Bridges or Tunnels SOFA ~1 Boundary The City of Palo Alto MAP4 SOFA II Existing and Proposed Bike Network This map is a product of the City of Palo Alto GIS Alma Street and the railroad tracks both form barriers between the area and Stanford University, the new Urban Lane PAMF facility and other areas to the southeast. The proposed pedestrian and bicycle crossing at Homer Avenue and Alma Street would help mitigate these obstacles. POLICY T-16: Improve pedestrian and bicycle connections between and within the Plan Area, the Palo Alto Transit Center, and Stanford University. PROGRAM T=6: Develop a plan for improvements to Alma Street, adjacent streets and key intersections, using bulb-outs, raised wall(ways, street trees and other measures to improve pedestrian safety and convenience within the plan area and crossing Alma Street, helping to link with the transit center and Stanford. POLICY T-17: Improve access for the disabled throughout the Plan Area. PROGRAM T-~’: Complete corner curb cuts throughout the Phase 2 SOFA Plan Area, consider the needs of the wheelchair bound and persons with other disabilities in planning for crossings and other public and private pedestrian improvements in the area. As sidewalks are repaired, applicable ADA requirements shall be satisfied. Community Facilities (CF) Community facilities include public and private facilities that provide services to the surrounding community. Among these services are schools, libraries, open space/public facilities and childcare. Because they are the subject of separate, ongoing planning processes at the School district and City-wide level, this Plan contains no policies or programs related to schools or libraries. However, the issues of schools and libraries related to the Plan area are briefly discussed below. Childcare and Open Space/Parks issues are discussed in more detail with accompanying Plan policies and programs: 1. Schools The ability of the neighborhood elementary school, Addison Elementary, located at Middlefield Road and Addison Avenue, other nearby elementary schools, and the middle and high schools to absorb the additional students resulting from new housing construction was a concern voiced in the planning process. Potential impacts on schools are addressed in the Environmental Impact Report for the entire SOFA area (Phases I and 2). Demographic changes are resulting in increasing enrollments throughout the city, which are the subject of Palo Alto Unified School District planning efforts. City policy requires that new development be evaluated for its impact on school enrollment relative to existing capacity. However, the City does not discourage new development solely on the basis of impacts to schools, nor does it require new development to address impacts to school enrollment beyond the payment of established school impact fees. In addition, the type of housing encouraged by policies in Phase 2 of the SOFA plan would yield fewer children than the single-family detached housing allowed in areas of the Phase I plan. 2. Libraries The area is currently served by the Downtown Library, located within the study area, and the Main Library, located less than one mile away. Library services are assumed to continue unchanged for the purposes of the Coordinated Area Plan. This issue was also evaluated in the environmental document for the entire SOFA area and was found to have a less than significant impact. 3. Open Space/Public Facilities Scott Park, a 0.4-acre mini-park located off Scott Street near Channing Avenue is adjacent to the Phase II plan area. The park contains a half court basketball court, a grassy area, playground equipment and picnic tables. The closest developed neighborhood park is 2.0-acre Johnson Park, located five blocks to the north across University Avenue. Kellogg Park, approximately 0.4 acres in size, located just south of Embarcadero Road and the turf area at Addison Elementary School both provide additional neighborhood recreational open space. In addition, the Williams House and gardens, located on Homer Avenue, provides an additional 0.25-acre of city-owned open space within the Plan Area, although presently public access to the space is limited to guided tours during the hours the museum is open. Additionally, the El Camino Park playing fields, located across from Stanford Shopping Center, are within one-half mile of portions of the Plan Area. In addition to these existing public facilities, a new two-acre public park will be developed by the City of Palo Alto along Homer Avenue between Bryant and Waverley Streets as part of the implementation of Phase I of the SOFA plan. This new park will be within easy walking distance of the entire Phase II area and will serve as the closest neighborhood park for residents of the area. Along with these existing and new public facilities, the SOFA area provides opportunities for private development of publicly accessible open space through the development of "pocket parks" or public plazas that are incorporated into the design of a private development. The inclusion of these types of public benefits in private development is encouraged by Policy CF-2 below. POLICY CF-I: Increase the amount of open space within one-half mile of the South of Forest residential neighborhood through a variety of techniques, including use of existing public open space, developing new public open space, and providing incentives for incorporating publicly accessible and usable open space into new development. POLICY CF-2: Encourage private development proposals to accommodate publicly accessible open spaces and connections to other open spaces where feasible. Encourage establishment of usable outdoor pedestrian open spaces, plazas, etc. with pedestrian amenities. Design Character and Guidelines (DC) 16 The goal of the Coordinated Area Plan with respect to Design Character is to create the conditions that wi.II encourage future development to preserve and enhance the original, varied, pedestrian-oriented and generally fine-grained scale of development in the area. In order to do so, the Plan policies address several different issues, including subdivision or lot development pattern, compatibility of new development with existing patterns and historic preservation, the process of development review, and the establishment of design guidelines and development standards. This section of the Plan addressees the visual quality, urban design and distinct character of the South of Forest Phase II Area. This character arises from .consistent patterns of physical forms, including the canopy created by the area’s street trees; the size, bulk, mass, height and location of buildings; the type of architecture and age of buildings; as well as from notable exceptions to those patterns. The SOFA Phase 2 Area contains a wide variety of building types, heights, sizes, and styles generally possessing a high degree of visual interest and pedestrian orientation. Styles vary, but the buildings have patterns of entryways, porches and fenestration in common. This section of the Plan addresses key aspects of this character for the SOFA 11 area, including street trees and heritage trees, historic preservation, architectural design and public art. The design guidelines included in Phase 2 of the Plan encourage the scale, bulk and mass of buildings and their architectural components to be compatible with that of existing structures in the neighborhood. Heights are generally limited to two or three stories (35 feet maximum) with four story-building components only allowed in areas along the west side of High and Alma Streets (50 feet maximum) where the height of the buildings would be compatible with the width of the street and speed of the traffic. Ground floor, designs will provide visual interest such as display windows, porches, storefronts, courtyards, landscaping, and architectural details in accordance with the Pedestrian (P) Combining District requirements. POLICY DC-I: Promote quality design as defined by style, detail, massing, materials, etc. Implementation of the design guidelines should allow for flexibifity and diversity in relation to the overall context of the neighborhood. PROGRAM DC-I: Include design guidelines for the Phase 2 area that encourage quality design as defined by style, detail, massing, materials. Encourage flexibility in design character and allow creative use of architecture styles consistent with the fabric of the neighborhood. POLICY DC-2: With new development, require new street trees, storefront treatment of front facades, pedestrian scale signage, pedestrian/seating, sidewalk widening, and other improvements to improve pedestrian experience throughout the Phase 2 Area. Building articulation, roofline stepbacks and variations, and frequent use of street entry features are all design measures that reinforce the original, finer grain of development in this area. POLICY DC-3: 1"7 The commercial development in the SOFA Phase 2 area is centered on Homer Avenue and Emerson Street, with many intact buildings remaining. The character of these commercial buildings, with store front entrances and no front or side setbacks, creates a lively pedestrian environment which should be reinforced by new development, particularly along Emerson Street, which links this area to the downtown. Figure 5 - Homer Avenue (to be added later) POLICY DC-4: Incorporate transition techniques into new buildings to blend higher density housing or mixed-use projects into the existing lower density residential housing adjacent to the southeastern portion of the plan area. POLICY DC-5: WORKING GROUP R~COMM~WZSA TtON; PROHt~!T PLANNED COMMUNITY (PC*) ZONES WITHIN TH~ SOFA !! AR~A ~,, ur:, .~ECOMMEHDA T~ON: PRO~’IB!T PLANNED POLICY DC-5: STAFF AL TERNAFIVE: PROHIBIT PLANNED COMMUNITY (PC), EXCEPT ALONG ALMA AND HIGH STREETS, WITCH A MAXIMUM FLOOR AREA RATIO (FAR) OF 1,5:1 IF JUSTIFIED BY THE SUBSTANTIAL PUBLIC BENEFITS OF INCREASED PUBLIC OPEN SPACE, ADDITIONAL AFFORDABLE HOUSING, CHILD CARE, PUBLIC PARKING OR OTHER COMMUNITY SERVICES IN THE SOFA 2 AREA. Preserving Existing Buildings and Scale One of the goals of Phase 2 of the SOFA plan is to encourage the preservation and adaptive reuse of ,historic buildings throughout the Phase II Area. Historic Preservation The South of Forest Phase 2 Area played a significant role in the early history of PaiD Alto and includes a substantial number of historic structures currently listed on PaiD Alto’s historic inventory. These structures, and the historic patterns of development they create, contribute to much of the area’s unique and interesting character. The commercial development along Homer Avenue and Emerson Street was the center of a mixed-use district, which provided a variety of essential services to the adjacent downtown and nearby residential areas such as Professorville, a National Register Historic District. The SOFA area included the residences, businesses and community facilities of a variety of ethnic groups and nationalities. Phase 2 of the SOFA CAP requires that properties identified on the City Historic Inventory or as eligible .for the state or national register of historic structures be preserved either on site or relocated (in the case of residential structures) in accordance with the Secretary of Interior Standards. fvlmcvV~y Recommend,~tio/~: ~’1;,~ ~.~e¢~: be s~~i!icar~ ~-~:::~.-:!:o/’,, ~o .r~.:~;k.~=c~te .,:-~! his~o.~fc sttt./ct~/ro.). All restoration work is to 18 be consistent and in substantial conformance with the Secretary of the Interior’s Standards for Historic Rehabilitation. Proposed development projects, for residential and non-residential use, that involve potential cultural resources shall include the preparation of an evaluation of the resource by a consultant hired by the City of Palo Alto and paid for by the applicant of the proposed project. The evaluation would determine if a structure is a cultural resource and identify acceptable mitigation measures that would address potential impacts to the structure. Map 6 shows the historic resources in the Phase 11 area. POLICY DO-6: Any building identified as meeting theeligibility criteria for the state or national register of historic resources as well as commercial structures which are listed on the local inventory as category 1,2,3 or 4 and residential structures which are listed on the local inventory as category I or 2, shall be required to conform to the Secretary of Interior Standards for rehabilitation when undergoing alterations or additions. POLICY DO-7: Require pubfic and private efforts to maintain, preserve, and use historic buildings, including those listed on the local inventory as category 1,2,3 or 4 and those on or eligible for the State or National Registry of Historic Places, and other historic resources, in Phase 2 of the SOFA Plan in order to maintain the scale and character of the area. POLICY DC-8: Allow exceptions of up to 25% less than the full parking requirement to encourage reuse of historic buildings for original or compatible uses. POLICY DO-9: Provide information to the public, developers, homeowners etc., on all available historic preservation tax programs, credits and other financial assistance available. POLICY DC-IO: Encourage use of the State Historic Building Code when reviewing proposed modifications to historic structures. POLICY DC-11: Promote continuation or restoration of the original use of historic buildings wherever possible, but allow adaptive reuse if compatible with preservation of historic features where original use is infeasible. POLICY DC= 12: Permit continued non-conforming use of historic buildings if necessary to assure preservation and restoration of historic resources. Continuation of the original use or a similar use should be pursued wherever feasible. Established and designated historic resources shall be exempt from the minimum densities outlined in the Plan. POLICY DC=13: Develop a Transfer of Development Rights (TDR) program for historic structures in the SOFA 2 area, which allows development rights to be transferred from historic buildings 19 Cow 3er St Waverley St Ramona Street Architecirural District Ramona St Emerson l H St ¯ Alma St ] Historic Resources m+mmmmm+mm,,+mm SOFA II Plan Boundary mm,....,..n.PAMF/SOFA Plan Boundary 0’ 100’ 200’400’ SOFA ~ 6 Coordinated Area Historic Resources in the SOFA Area Plan in the area to eligible receiver sites in either the SOFA 2 area or the Downtown (CD) area with the limitation that development rights cannot be transferred to another historic building. 4. Public Art Public art makes a valua~ble contribution to the urban design of Palo Alto and enriches the built environment and public life. The plan encourages new development in the Phase 2 area to provide public art as a part of the project POLICY DC=13: Encourage new development to provide public art within all major projects. The art is to be reviewed and approved by the Public Art Commission. PUBLIC AND PRIVATE TREES (PPT) To achieve the city’s tree preservation goals, all development shall be consistent with the Citywide Tree Protection Ordinance and the Tree Technical Manual. The Citywide Tree Preservation Ordinance requires preservation and maintenance of Protected Trees which include Quercus agrifolia or Coast Live Oak and Quercus Iobata, or Valley Oak, with a diameter of 11.5 inches or greater, measured at 54 inches above natural grade and Sequoia sempervirens, or Coast Redwoods with a diameter of 18 inches or greater, measured 54 inches above natural grade. Planting of new oaks and redwoods and protection of those not yet large enough to be protected will also help to maintain Palo Alto’s distinctive tree canopy after the inevitable loss of today’s large oaks and redwoods. The Tree Technical Manual establishes standards for removal, maintenance, and planting of trees. In establishing these procedures and standards, it is the City’s intent to encourage the preservation of trees. Street Trees and Heritage Trees Policies: The South of Forest Area of Palo Alto includes many fine tree specimens growing on public and private property. The area also contains several examples of the two oak species and redwoods that are protected in Palo Alto. These notable trees and the remainder of the urban forest presents both opportunities to build on the area’s distinctive features and constraints for the location of new development within the area. The existing trees provide wildlife habitat, shade, and a dramatic urban design feature and enhance the pedestrian environment. The preservation and enhancement of these resources is essential to maintaining the character of the neighborhood. POLICY PPT-I: Preserve and protect existing street trees, planning new development so that damage or removal of existing healthy street trees is minimized. POLICY PPT=2: 2O Driveways, walkways and structures should be located to preserve existing street trees wherever possible. Protective measures should be taken in construction and landscaping to assure the continued health of existing street trees. POLICY PPT3: Any new development of substantial renovation of an existing building within the Plan Area should consider the replacement of any "missing" Street trees at an interval of approximately 20-25 feet on center. An appropriate species shall be selected to create a unified pattern within each block, with the intent of creating an overall species diversity in the urban forest. POLICY PPT-4: Street tree selection should be in accordance with the proposed street tree species shown in Table__ (add table as Dave and I discussed) or as otherwise approved by the Planning or Public Works Arborist. POLICY PPT-5: Development improvements that involve removal and replacement of sidewalks (twenty foot minimum) and/or street trees should first consider the benefits of using structural soil, as specified by the City of Palo Alto Public Works Department, as a planting medium below the sidewalk surface. Implementing this new technique will promote long term benefits by averting sidewalk and pavement damage from tree roots, enhance vigorous shade tree growth and allowing safer pedestrian travel This shall apply for all city owned right-of-way areas when a more than twenty feet sidewalk and planter strip is removed or replac.ed, and/or when a subdivision is approved. POLICY PPT-6: Protect and maintain Heritage Trees. In addition, promote preservation of Coast Live Oak and Valley Oak, which are not yet large enough to qualify for protection under the Tree Protection Ordinance. Incorporate planting of these native oak species in the proposed park, other established open spaces, plazas, etc. and in other appropriate locations in the Plan Area. POLICY PPT-7: Provide for and strongly encourage the preservation of significant trees in the plan area when feasible through the granting of minor exceptions in the Plan Development Standards and Design Guidelines. In order to introduce a healthy diversity of street trees, while producing consistency within a block to create a strong pattern, the street tree species listed in Table 8 shall be used, unless an exception is approved by the Planning and Public Works Arborists (Table 8 is being updated). Chapter IV - Design Opportunities There are two basic categories of design opportunities: those on public property; and those on private property. The design guidelines in this Chapter of the Phase II SOFA plan are divided into those two basic categories. These guidelines are intended to guide development and are not required elements for every project. Section 4.10 Design Guidelines for Public Property 4.10.1 4.10.2 4.10.3 4.10.4 4.10.5 4.10.6 4.10.7 4.10.8 4.10.9 4.10.10 4.10.11 4.10.12 4.10.13 4.10.1 (a) (b) (c) 4.10.2 (a) (b) (c) (d) Streets and Alleys Paseos and Alleyways intersections Gateways Sidewalks Pedestrian Amenities Street Furniture Crosswalks Street Parking Landscaping Lighting Signage Public Art Streets and Alleys Alleys should connectto other alleys or streets whenever possible to form a continuous vehicular and pedestrian network; New developments should incorporate design features into their projects to encourage pedestrian usage of existing and new alleys, where applicable; Street improvements should facilitate and enhance the pedestrian environment to include, but not be limited to, the following features; street trees, benches, bus stop shelters, increased sidewalk width, pedestrian open space and other public/private open space and right of way improvements (ie. Bulb outs, enhanced pedestrian crossing features etc.) Paseos and Alleyways In areas where walking is to be encouraged, streets lined with garages are undesirable. Alleys provide an opport~.nity to put the garage to the rear, allowing the more "social" aspects of the building to be oriented toward the front of the street. Streets lined with porches, entries and living spaces are safer due to visual surveillance. Alleys in commercial areas place service .vehicle access and parking away from the street and sidewalks, offering a secondary access to individual parcels and attractive and comfortable streetscapes. Design of alleys should provide sufficient light to ensure nighttime safety. Where alleys intersect streets, adequate sight distances and building setbacks should be provided. Paseos have the potential to be attractive, well-designed, people oriented places that provide desirable spaces. Paseos, whether publicly or privately owned, shall be designed and maintained for general public use. Paseos should be incorporated into new public or private developments where any of the following situations occur: 1. A public area exists within the interior of a block that should be connected to the surrounding street frontage; 2. Pedestrians are required to walk out of their way to move between public areas on a block; or 3.Where there are opportunities to make pedestrian connections between residential and commercial areas. 4.10.3 (a) (b) (c) (d) 4.10.4 (a) (b) Other functions of the paseo (e.g. merchandise delivery, trash collection and fire access) may be considered during the design and development review process. Intersections . Intersections should be designed to facilitate both pedestrian and vehicular movement. The dimensions should be minimized while providing adequate levels of service. Intersections should be designed to slow traffic and reduce pedestrian crossing distances. A street system should balance the needs and viability of the pedestrian, as well as the car. Reduced auto speeds improve pedestrian accessibility and safety, and can continue to accommodate safe vehicular movement. Minimum curb radius at the intersection Will reduce the pedestrian crossing distance while reducing the speed of the car through the intersection. Gateways Gateways should be located at the intersection of Alma Street and Homer Avenue and at the intersection of Romona Street and Homer Avenue. The gateways denote the entrance into the pedestrian friendly shopping street. Elements of the gateway features, such as materials and form should be used in the street furniture throughout the area. 4.10.5 (a) (b) (c) 4.10.6 (a) (b) 4.10.7 Sidewalks Sidewalks adjacent to new development should include a continuous minimum clear width of 5 feet for pedestrian travel and a minimum overall sidewalk width of ten feet to the curb line. Where such a sidewalk width is not currently provided, new development should supplement the public sidewalk with an additional setback for the building. Where existing buildings constrain sidewalk widening on private property, developers of the subject property are encouraged to widen the sidewalk in the public right of way where possible. Historic sidewalk dimensions should be investigated and incorporated into new development where appropriate. Pedestrian Amenities Sidewalk improvements should be grouped so that a minimum 5-foot wide walking area is maintained for pedestrians. Trees, street furniture and outdoor displays and tables should be located either next to the curb, or within 3 feet of the building provided that adequate walkway is preserved. Arcades or building setbacks with awnings or shade trees should be provided where sidewalk width is inadequate for anticipated pedestrian and outdoor use. Street Furniture 23 (a) 4.10~8 Street furniture should be selected or designed to promote a sense of continuity throughout the area. The design intent is to create a distinctive community character while meeting the user’s needs. Crosswalks ¯ (a) ¯ (b) Crosswalks should be designed to clearly confer the right-of-way to the pedestrian and minimize the crossing distance. Raised crosswalks will be considered where there are no traffic signals. The color and texture of paving materials shall be reviewed and approved by the City prior to installation of such a crosswalk. The paving materials should enhance visibility and minimize hazards such as slipping and tripping. 4.10.9 Street Parking Street parking should be provided although it will not count towards meeting a private development’s on-site parking requirement. In some cases a street parking space may be deleted to use the area for a landscaped area with a bench or other pedestrian amenity, or for ADA compliance. 4.10.10 Landscaping (a) (b) (c) (d) (e) (f) Landscaping should be appropriate for the area, well maintained, and not allowed to create a safety hazard by concealing or overgrowing pedestrian facilities. Tree canopy should be used wherever possible to provide shade and weather protection for pedestrians. Adequate room for tree growth should be provided so that tree roots will not damage pedestrian facilities. Landscaping may be used to provide a buffer between vehicles and pedestrians and to screen parking and utility areas. Street tree planter areas along Alma should incorporate Japanese Box Wood borders similar to existing examples along Alma between Channing and Homer Avenues. Streets should be lined with a limited selection of trees to give them a unified and distinct image. Adequate sight distances must be maintained to ensure safety. In areas that do not have space for planter strips, the trees should be kept close to the sidewalk to provide shade and should be aligned to visually frame the street. In all cases, trees should be trimmed regularly to accommodate buses and service vehicles. Tree maintenance should be ensured. Shade for the comfort of the pedestrian is key to creating a viable walking environment. Street trees help reduce heat build up from large asphalt areas and create a cooler microclimate. Trees also provide habitat for local birds. 4.10.11 Lighting (a)Decorative lighting should be used in the public right-of-way that showcases adjacent buildings. Light fixtures should be attractive elements during the day when they are not illuminated. 24 4.10.12 Signage (a) (b) Where permitted, signs should be designed to be read at the pedestrian scale. Use of projecting signs and signs on awnings is strongly recommended. Building mounted signs should relate to the architectural design of the building, and should be indirectly lit, avoiding large areas of bright-colors. Illuminated can signs and illuminated awnings are not permitted. 4.10.13 Public Art (a)Art should be used whenever possible in the public right-of-way and on private property to provide visual interest for pedestrians and other passers-by. Section Section Section Section Section Section Section Section Section Section Section Section 4.20.1 (a) (b) (c) (d) 4.20 Design Guidelines for Private Property 4.20.1 Architecture 4.20.2 Entrances 4.20.3 Height 4.20.4 Massing/building articulation 4.20.5 Driveways 4,20.6 Fences and Walls 4.20.7 Landscaping 4.20.8 Lighting 4.20.9 Parking 4.20.10 Bicycle Facilities 4.20.11 Art Architecture Architectural design and styles of new construction, additions, modifications, etc. is strongly recommended to reference and enhance the scale, massing and character of the existing architectural and/or historical heritage of South of Forest Avenue area. Contemporary reinterpretations of these styles, which are similar and compatible in style, color, articulation and form are also encouraged. Each style should utilize characteristic roof forms, materials, window treatments, and other details, which should be used consistently throughout the design in order to create a compatible design. Buildings along Emerson, Homer and Ramona should provide a particularly inviting appearance to pedestrians, with high quality materials and landscaping and use of all of the guidelines listed provided herein to improve the pedestrian experience. Publicly oriented uses should be visible through storefront windows from the sidewalk. 4.20.2 (a) Entrances Main entrances to buildings are encouraged to be directly visible from the street. A clear entry path must lead from the sidewalk to the front door. 25 (b) (c) (d) (e) (f) Low hedges, fences or trellises or gateposts are recommended to mark the transition from public street to common entry to private residential entrance. Ornamental lighting consistent with the building’s architectural style is encouraged to improve the safety, security and attractiveness of the pedestrian entry. Open space, plaza areas, etc, are recommended in association with building entrances. Outside pedestrian seating (i.e. benches) is encouraged. The linear seating length is recommended to be equal to 15% of the proposed building linear frontage with a minimum of 12 lineal feet seating. Trellises, arbors, porte cocheres or other similar architectural features are encouraged to identify entrances. These may project no more than three feet into the setback area. 4.20.3 Height. Staggered step backs that vary the massing of portions of a building are recommended to encourage diversity in design and assist in increasing the access to daylight from the interior of a building. 4.20.4 Massing/building articulation. It is recommended that building mass or facade composition be articulated in modules of 50 feet or less, with major roof line or massing variations of a full story at increments of 100 feet to reflect the historic development pattern of this area on lots of 50 feet to a maximum of 100 feet wide. Techniques for creating this massing or facade module may include but are not limited to the following: roofline variations and projections or recessed wall surfaces. 4.20.5 Driveways (a) (b) (c) (d) Setback of driveways from adjacent properties should be a minimum five (5) feet and setback from adjacent buildings shall be a minimum of three (3) feet. Maximum number of curb cuts for one building should be one two-way curb cut or two one-way curb cuts per parcel or for every one hundred fifty (150) feet of frontage. Maximum width should be twelve (12) feet for a one-way driveway and twenty four (24) feet for a two-way driveway. Maximum grade of ramps should be sixteen percent (16%). Ramps should be a maximum of 20 feet wide. 4.20.6 Fence and Walls (a) (b) Aesthetically appealing fences and/or walls should be provided along all property lines to screen multi-unit buildings, service areas, and parking areas from adjacent developments with a minimum of a five (5) foot planting area should be established adjacent to the fence or wall with shade trees planted at a minimum spacing of twenty (20) feet on center. All service areas, sanitation areas/containers, recycling bins, mechanical areas and similar items and functions should be entirely screened. Screening should be a minimum of one foot above the height of the container or similar structure. 4.20.7 (a) (b) (c) (d) Landscaping Planting Strips. All new development should include a 5-10’ feet planting strip of grass or low growing ground cover at curbside along all residential street frontages. Street Trees; (1) Street trees, should be planted (at applicants expense) along the centerline of the planting strip at a maximum spacing of twenty-five (25) feet on center of the entire length of street frontage. Where existing street trees in good health and condition exist, such trees should be protected and incorporated into street tree planting. Species of the shade trees should be as approved by Planning and Public Works arborists; (2) New development or major remodeling of existing development should include planting of 24 inch box street trees (at applicants expense) to replace any missing or diseased trees. Species should be selected according to Table II1-1 Street Tree Species Recommendations unless otherwise approved by the Planning and Public Works arborists. Vegetation. On sites where existing heritage and protected trees and other significant landscape features exist, new development should be designed to preserve such trees and incorporate them into the open space or other appropriate areas of the development. For summary of City ordinances and requirements and map of such trees, refer to Chapter III, Section E of this Plan. Open space/pocket parks. Trees of at least 24-inch box size should be planted in all open spaces at approximately 25 feet on center. Adequate area for root zone should be incorporated into underground or decked parking garage design. 4.20.8 Lighting. Exterior lighting within parking areas should be adequately shielded to minimize glare and intrusion on neighboring residential properties. 4.20.9 (a) (e) (f) (g) Parking Parking for multi-family projects should be underground where feasible. Partially submerged V2 level below the building is allowed but discouraged because it raises 1st floor activity above the pedestrian level. Required guest parking may be provided in well landscaped lots at grade. Any garage openings for natural ventilation associated with partially below grade parking should be located along side or rear property lines rather than along street faces. Openings should be screened with lattice that is compatible with the facade above, and with hedges or other planting. Garage lighting must be designed to minimize glare and intrusion though the plant and lattice screening. Requests to extend fully underground parking under the public right of way may be considered provided that there will be no cost to the City, no impact on the quality of street trees and on-site tree landscaping to be provided and no impact to existing and/or proposed utilities or similar infrastructure. Surface parking lots should be located behind buildings or in the interior of a site whenever possible. Surface parking lots should be visually and functionally segmented into several smaller lots. Land devoted to surface parking lots should be reduced via redevelopment and construction of shared parking facilities. The configuration of surface parking lots should accommodate future redevelopment. All surface parking lots should be planted so that in 10 years 70% of the surface (h) (i) (J) area of the lot is shaded. Additionally, surface parking lots should be screened from streets by landscape treatments. Limited surface parking may be provided outside required front setback areas. Such surface parking should be planted with shade trees at a ratio of one (1) tree for every three (3) spaces in an "orchard" planting arrangement, with the tree located between the parking spaces to maximize shade over the paved parking area and the area where cars are parked. Providing approximately 10% of required spaces as short term parking outside underground garage structure is encouraged and may be identified as short term parking only. This surface level parking should be landscaped with two trees for every 3rd space at the front and near the rear wheel area. Short term parking should be located along the rear alley when available, serving to widen the alley traw)l lane to a safer 20 foot width while creating parking with the look and feel of public on-street parking. Parking structures may be used for shared parking arrangements, but should not dominate the street frontage. Retail uses should be encouraged on the first floor of street-side edges of parking structures. 4.20.10 Bicycle Facilities (a)Pedestrian facilities should be connected with bicycle parking facilities whenever possible to encourage bicyclists to park their bikes and walk to nearby destinations. 4.20.11 Art (a)Art should be used whenever possible to provide visual interest for pedestrians and other passers-by. Chapter V- Development Standards Development Standards refer to a specific, quantitative requirement, which provides the minimum or maximum amount, type or location of development possible within an area. These kinds of requirements are often found in zoning ordinances. Compliance with standards can be easily evaluated; either the proposed building and site improvements comply with the standards or they do not. Land Use Designation Unique to SOFA II There is one land use designation in the SOFA 2 area. (Staff Alternative - Rbere are two land use designations in the SOFA 2 area). It allows both commercial and residential uses as outlined below. (Staff Alternative - Both allow commercial and residential uses as outlined below). There are however two distinct sections of the area, each with different height limits to accommodate taller buildings (up to 50 feet) closer to Alma Street and lower buildings (35 feet) in the rest of the area (see maps entitled "Working Group Plan Concept" and "Staff Recommendations"). 5.1 Permitted Uses 28 (a) (b) (c) (d) (e) (f) (g) (h) d)(k) (m) (n) (p) (q) (r) (s) (t) (u) 5.2 (a) (b) (c) (d) (e) (g) (h) d) (k) accessory uses to the primary use; convalescent facilities; day care centers; small and large day care homes; residential care homes; eating and drinking services except drive ins; educational facilities; financial services; general business services; home occupations; lodging (including Bed and Breakfast facilities); medical and professional offices, limited to 25% of the site area up to a maximum of 5,000 square feet (2,500 of which can be on the ground floor) in the entire SOFA 11 area, except on Homer and Emerson Streets where new office is subject to these size requirements and can only be located above the ground floor; genemi busine&~ off~c~ p~ohil.,ii~:~,d ot the gr~:,.,,nd floor ~outh of Hom~;,~~ Av~:nue and along Emersor;, Street and limited to 25% of the ~ite area up to a maximum where allowed; staff altemati.ve: no limitation or ~(r:~e of :ff~ce in the area south of Homer personal seHices; private clubs; religious institutions; retail se~ices excluding liquor stores; reverse vending machines; two-family and multiple-family residential uses (including SRO and senior housing facilities). Conditional Uses automotive (including tire) services (on Alma and west side of High Street only); ambulance services (along Alma and High only); automobile service stations per Chapter 18.82 (on Alma and west side of High Streets only); commercial recreation; parking as a principal use; temporary parking facilities (less than 5 years); transportation terminals (on Alma and west side of High Street only); utilities facilities; warehousing and distribution (on Alma and west side of High Street only); and Exclusively residential use that is not fully affordable with a floor area ratio up to 1.15:1. 5.3 Site Development Regulations a) Compatibility: Compatibility with the existing area is required for all new and remodeled structures. Compatibility is achieved when the apparent scale and mass of new buildings is consistent with that existing in the neighborhood, and when new construction shares general characteristics and establishes design linkages with surrounding existing buildings so that the visual unity of the street is maintained. A compatible building design is one that supports and reinforces the shared architectural and site features of neighboring properties. It is not necessary in an area of coherent architectural or historic character to employ specific styles in new construction in order to achieve compatibility. Other fundamental features of neighboring properties are more important. A contemporary style, for example, can be fully compatible with a historic neighborhood if the new design has taken careful account of the following characteristics of the street and area: siting, scale, massing, materials; the rhythmic pattern of the street established by the general width of the buildings and the spacing between them; ¯the pattern of roof lines and projections; ~the sizes, proportions, and orientations of windows, bays, and doorways; ¯the location and treatment of entryways; ~the shadow patterns from massing and decorative features; ¯the treatment of landscaping. With respect to scale, compatibility refers to what is apparent rather than to actual measurements. Buildings can be designed to appear smaller or larger than they actually are by respectively increasing or reducing the articulation of massing and wall surfaces. When articulation is minimal, one’s primary impression is of the building as a whole, and it seems larger and more monolitl~ic. When articulation is increased, the primary impr~ession is of the building’s separate parts perceived one after another, and the building seems smaller and more humanly scaled. 3O b) Density: c) Maximum Unit Size: Minimum Site Area: Floor Area Ratio: d) Office Limitations: e) Setbacks: 30 duJac(except 40 ducat w.Jsenior studio or units) No minimum density requirement,: Staff Alternative: 30 du/acre maximum, maximum 40 units per acre for senior~ studios and affordable uses and a Minimum densit~ of !5 units per acre in the Residef~tia/ Tr~nsitior~ zone. 40 units per acre maximum, except maximum 50 units per acre for senioc SRO, studies and affordable uses and a Minimum density of 20 units per acre in the ~ransit Oriented ResidentL~l zone. 1,500 square foot maximum unit size. None Exclusively Residential (except; A/orW Homer and Emerson Streets); t~ion.. Residen tia !,40 Mixed-Use (with Reside~tia()! 15 (r~onresidenti~d FAR shall not exceed 40 exc;~pt as *~oted fo~" l~istoric structures)~ Staff Alternative: Same as above except them the potential for an FAR of 1.5 along Alma and Streets, wid~ a PC and specific public benefits noted in this Plan (nonresidential RAn shall not exceed .40 except as noted for historic structures). 25% of site area up to 5,000 Square Foot Maximum area wide, 2,500 of which can be on the ground Floor. On Emerson and Homer Streets, new office of any kind only allowed above the ground floor. South of Homer, new general business off~. allowed above the grouted floor: Staff Aftemative: South of Homer, retail storefront design required, but no limitation on type of office use on the ground floor. Size limitations as stated above do apply. Residential only:Front:0 to 10 feet, and designed to conform to i Projections into setbacks: f) Height: Interior Side: Street Side: Rear: predominant. Existing pattern. Same as Front Same as front 15 feet, with a 5 foot encroachment allowed for underground or podium parking. Rear along Alley:5 feet and designed to Accommodate Use of alley. Non-Residential only: None (see landscape inset requirement) Mixed-Use:None (see landscape inset requirement) Three-foot projections into the front setback are allowed for porches, arbors, trellises and other entry features. Working Group: /n aft areas except portions of Alma: 35 ,feet to midpoint of roof, except for flat or mansard roofs where the height shall be measured to the top of the roof, unless otherwise recommended to the Director of Planning and Community Environment by the ARB or HRB~ARB when making compatibility findings (See map entitled "Working Group Plan Concept" for locations)~ Along portions of Alma: 50 ,feet to the midpoint of the roof, except for flat or mansard roofs where the height shal! be measured to the top of the roof. unless otherwise recommended to the Director of Planning and Community Environment by the ARB or HRB/ARB when making compatibility findngs (See map entitled "W{~rking Group Plan Concept" for Iocations)~ Staff Alternative: 32 in ,~II areas except portions of Alma: 35 feet to midpoint of roof (see Map entitled "Staff AitemaUve" for’ locations); Along portions of Alma: 50 feet to mic, lr~oint of mot with a minimum 15 foot stepback for t;c,u~th floor and adjacent to single-story development (see Map entitled "Staff Alternative" for locations), Parking: A/i parking shall conform to the requiremer~ts in qChaoter !8 8,:~ of tt~e Palo Alto Municipal Code, Tandem park/n9 shall be al!owed fo~’ ;:esidentia/ uses Staff Alternative, !5 spaces per unA, if share available and pass provided, except Office or OUter Commemial - I space ;for eveO, 350 square feet of gross floor area, which can be reduced by 5% with the implementation of a Mansportation Demand Program Retail- I space t<..~;~ every 250 square Met of gross ,floor area, except that no parking th~ first !000is required for "~ square feet of dress ..floor aFea. 33 Historic Buildings:In accordance with the standards listed above, except that reductions may be approved by the Director of Planning and Community Environment of up to 25% for historic buildings that undergo rehabilitation in conformance with the Secretary of the Interior’s Standards. h)Ground Floor Office Restrictions: Pedestrian Shopping Combining District (P): j)Landscaping: k)Seismic Bonus: Historic Bonus: Along Emerson and Homer Streets, new office is allowed only above ground floor. Size of ground floor office use in permitted locations is limited to 2,500 square feet. Working Group: South of Homer ~ New general business office is not allowed on the ground floor, Professional and medical offices are al!owed on the ground floor up to 2,500 square feet in size, Staff Alternative: South of Homer ~ No resttfction on type of office use on the ground floor, but size restriction of 2,500 square feet does apply, Retail display areas, covered entries and building details or landscaping that prevent blank walls adjacent to sidewalks are required in the entire SOFA 2 area. All non-residential and mixed-use projects shall incorporate 3 foot. deep landscape pockets along all sidewalk frontages. Category I, II and III buildings on the City of Palo Alto Seismic Inventory, which are undergoing renovation, are eligible for increased floor area of either 2,500 square feet or 25% of existing building square footage, whichever is greater. All increased square footage can only be used to provide residential units and can only be used on site. No seismic bonus shall be available for Category 1, 11 or 111 buildings that are removed and replaced with new buildings. Category I, II, III and IV buildings on the City of Palo Alto Historic Inventory and all buildings eligible 34 for the California or National Register are eligible for Increased floor area equal to .25 of the total building gross floor area for any permitted use other than non-retail commercial use and up to .10 of the total building gross floor area for non-retail commercial uses within the SOFA II area. The bonus square footage may be used on-site or transferred off-site. Any bonus floor area used on- site shall be designed to conform to the Secretary of the Interior Standards. m)Title 24 Exemption: n)Transfer of Development Rights: Square footage added to existing buildings to bring the building into compliance with the Americans with Disabilities Act (ADA) shall be exempt from floor area calculations. No ADA exemption shall be available for new buildings. Bonus square footage obtained through the Historic Bonus allowances outlined above maybe transferred off-site to eligible receiver sites in the SOFA 2 area or in the downtown (CD-C) area. Bonus square footage cannot be transferred to another historic building in either area. Bonus square footage that is used on the historic site in the SOFA 2 area is not required to provide parking for that square footage. Bonus square footage that is transferred to an eligible receiver site within the SOFA 2 area is required to provide parking on that receiver site for the transferred square footage. Bonus square footage that is transferred off-site to a location within the downtown (CD-O) area is required to conform to the applicable parking requirements in that zoning district. Landscaping a) b) Street trees are required along all streets. Street trees shall be spaced no further than 30 feet on center in planter strips or tree wells located between the curb and sidewalk. Tree species and planting techniques shall be selected to create a unified image for the .street, provide effective canopy, avoid sidewalk damage, and minimize water consumption (see Chart 8 for tree selection along specific streets). Surface parking lots are required to be landscaped in accordance with Municipal Code Section 18.83. Bicycle Parking and Storage J H PERMITTED LAND USES RES-TRANS 35 RES-TRANS 50 P-RES-TRANS 35 PF R-2 RM-30 Residential Transition up to 35’ in height at 1.15 FAR Residential Transition up to 50’ in height at 1.15 FAR Pedestrian Oriented Residential Transitional 1.15 FAR 35’ height No Ground Floor Office on Homer or Emerson, no General Business Offices south of Homer except along Alma, Max 2500 sf office on ground floor Public Facilities Low Density Residential District (7-14 units/acre)/existing Medium Density Residential District (15 - 30 units/acre)/existing Sites with Redevelopment Potential (pending application or FAR<I) Historic Property: Category 1 & 2 eligible for National Register N 0’25’ 50’ 100’ 200’ WORKING GROUP COMMENDATIONS Map 7 SOFA PHASE 2 Coordinated Area Plan 5/~7/02 (a)Bicycle parking and storage is required to be provided in accordance with Municipal Code Section 18.83. Signage (a)All signs are required to comply with Chapter 16.20 of the Palo Alto Municipal Code. Illuminated can signs and illuminated awnings are prohibited in the SOFA 11 area. Non-conforming uses/Non-complying facilities (a) (b) Existing non-conforming uses may remain provided they were legal or legally non conforming on __.; Non-complying structures/facilities may be used for permitted or conditional uses provided that the proposed use does not increase the degree of non-compliance. 5.14 (a) (b) (c) (d) Special Provisions Service access. Trash and loading areas shall be centralized where possible, and noises, odors and clutter shall be screened effectively from streets and adjacent properties. Pocket parks, plazas, and courtyards; (1) Pocket parks, plazas, and courtyards should be located on major circulation routes to increase usage, such as at corners, or near building entries; (2) Restaurant uses, cafes, or similar service establishments are strongly encouraged to provide outdoor seating .areas, benches or tables; Trash, service equipment, mechanical equipment or other similar service uses; (1) Trash and service equipment including but not limited to the following items: satellite receiving dishes, dumpsters, recycling containers, Air Conditioning units, etc. shall be located to the rear of buildings or otherwise out of public view and shall be enclosed or screened with 100 % opaque materials around all sides including landscaping where permissible; (2) Trash recycling areas and similar offensive areas shall be entirely enclosed (top and sides) and screened with 100% visually opaque materials when located adjacent to or in close proximity to existing residential uses, proposed residential uses and residentially zoned properties. Compatibility with existing historic structures; (1) Buildings near or adjacent to historic residential or non residential buildings must be compatible to the scale and massing of such buildings, restricting building height or stepping back by a minimum of 15 feet to preserve the scale of the street wall; (2) Existing buildings, whether or not included in the City’s historic inventory, provide character and scale to new development and should be reused and remodeled rather than demolished whenever possible; (3) Renovated storefronts should be compatible in materials scale and proportion with historic or existing buildings. Awnings and signage should complement and not hide building columns, windows, and other architectural features. Where several businesses exist in a single building, coordination of awnings and sign changes can reduce visual clutter. 36 (f) (g) (h) Compatibility of vehicle, automobile and other similar commercial service uses; (1) New projects including such uses as vehicle, automobile repair, automobile service station, transportation center or other noise creating uses must incorporate design and operational mitigations to reduce potential noise and visual impacts on other adjacent uses with particular attention to existing residential uses; (2) All new developments or substantial remodeling of existing uses, which might be impacted by such uses shall incorporate design features to minimize potential impacts from such noise producing uses on potential future building tenants and users; (3) All automobile related uses and other commercial service uses shall provide attractive 100 percent opaque screening around the entire perimeter of all service yards, vehicle, automobile storage parking lots. Screening shall include dense landscaping in combination with an opaque fence if feasible; (4) All uses producing strong odors and fumes, which can be detected from off or adjacent to the property shall install equipment or containment areas in order to eliminate such detectable odors and fumes. Residential uses above non-residential uses; (1) Where residential uses are located above non-residential uses, balconies, window designs, building articulation, street level entries and other similar architectural characteristics shall be utilized to emphasize the residential character of the structures and strengthen the pedestrian scale; (2) Where commercial offices are located on the ground floor, public reception areas or display windows must be clearly visible from street level. Frosted glass or translucent or solid window blinds are not permitted. Non residential uses above residential uses; (1) When non residential uses are located above residential uses, the ground floor residential uses should be slightly raised above grade level, including a landscaped setback, porch and stoop design to provide both privacy for the resident and interest for the pedestrian; (2) Where non residential uses are located above residential, commercial development must not overhang outer wall of residential unit by more than eight feet, in order to allow adequate light for residential units; (3) Development along Alma Street or near Substation. Residential development along Alma must include special architectural design mitigations and environmental impact analysis, which verifies that private residential open space and interior space meets applicable City noise guidelines. Residential development and open space should generally be located on the top and to the rear of such projects to help buffer residents from traffic, train and substation noise. Chapter Vl implementation The following chapter provides information on the approvals necessary for projects proposed within the Phase II Plan area as well as provisions for exceptions to the plan. In addition, this chapter creates a mechanism by which alterations can be made to the plan in the future. The Palo Alto Municipal Code (PAMC) sections referred to in this chapter are contained in Appendix A for reference (will be included later). 37 A. Review Procedures I) PERMITTED AND CONDITIONAL USES Permitted Uses All permitted uses listed in the development standards are required to obtain a Use and Occupancy permit or a CPA business license if the City adopts such a license in the future prior to occupying any structure. Any alteration or improvements are subject to review in accordance with the provisions of this plan. Conditional Uses All conditional uses listed in the development standards may only be allowed subject ~to the issuance of a Conditional Use Permit in accordance with Chapter 18.90 PAMC. The Director of Planning and Community Environment shall render a decision on all Conditional Use Permits, following a public hearing, and appeals of this decision shall be forwarded to the Planning Commission and City Council. II) ALL DEMOLITION, ALTERATION OR CONSTRUCTION WITHIN PLAN AREA Non-historic Uses and Sites: Non-historic uses and sites that are not adjacent to or across the street from an Historic use or site, shall be subject to the architectural review board (ARB) process as outlined in Title 16 of the Palo Alto Municipal Code. ARB review is required for all new construction of non-single-family or two-family uses (including additions and modifications) to public and private property within the Plan area. The ARB recommendations are forwarded to the Director of Planning and Community Environment for a decision. Appeals of this decision are subject to City Council review and shall follow the applicable appeals process for ARB decisions, as established by Chapter 16.48 of the Palo Alto Municipal Code. Minor changes to existing improvements and projects may be approved by staff per 16.48 of the PAMC. These projects will be reviewed for consistency with the Plan by Planning Division staff. Appeals of this type of decision shall be forwarded to the ARB for a determination of whether the project is consistent with the Plan, pursuant to PAMC Section 19.10.060. Submittal requirements, fees and noticing shall be in accordance with the Chapter 16.48 PAMC. ALL HISTORIC USES AND SITES AND NON-HISTORIC USESAND SITES ADJACENT TO OR ACROSS THE STREET FROM HISTORIC USES AND SITES: Identified historic uses and sites and non-historic uses andsites that are adjacent to or across the street from historic uses and sites shall bereviewed by a combined HRB/ARB board and process as established by the Director of Planning and Community Environment during the implementation of Phase 1 of the SOFA CAP. The HRB/ARB is authorized under this Plan to determine whether new construction is consistent with the Plan, and therefore permissible under the PAMC Chapter 19.10.060. The HRB/ARB recommendations are forwarded to the Director of Planning and Community Environment for a decision. Appeals of this decision are subject to 38 City Council review and shall follow the applicable appeals process for ARB decisions, as established by Chapter 16.48 of the Municipal Code. Minor changes to existing improvements and projects may be approved by staff per 16.48 of the PAMC. These projects will be reviewed for consistency with the Plan by Planning Division staff, including the Historic Preservation Planner. Appeals of this type of decision shall be forwarded to the HRB/ARB for a determination of whether the project is consistent with the Plan, pursuant to PAMC Section 19.10.060. IV) SUBDIVISIONS, PARCEL MAPS AND OTHER LAND DIVISIONS All divisions of property within Phase 11 of the SOFA Plan Area shall be reviewed and processed in accordance with the Subdivision Map Act and Title 21 (Subdivisions) of the PAMC. Lot sizes shall be as determined by the Development Standards of this Plan, all other requirements shall be in compliance with the PAMC. Minor variations from the established minimum and maximum lot sizes may be permitted as provided for in this Plan. B. Plan Amendments There will be a need to modify, add or delete programs, policies, development standards, design guidelines, concepts and review processes in the Plan to ensure consistency with the future policies of the City, future development trends and to meet the ongoing needs and desires of the residents and stakeholders in the Plan area. This Plan authorizes two procedures for amendments. All amendments must be initiated by the City Council on request of the Planning Commission or the .Director of Planning and Community Environment. At the time an amendment is initiated, the City Council shall determine whether it will be processed as a "Plan Amendment" or, if it involves development standards and design guidelines only, as an "Administrative Amendment." "Plan Amendments" are major changes to the policies, programs, development standards, design guidelines, Plan concepts or review process requiring adoption of an ordinance that alters the Plan. Plan amendments shall be heard by the Planning Commission and City Council in the same manner as Comprehensive Plan Amendments are processed under the Palo Alto Municipal Code. Staff Recommendation: /f the City Counci! adopts a Transit Oriented Development (TOD) zone as part of the zoning ordinance update, the applicability of that zone within the SOFA 2 area should be evaluated. Application of the zone should be reviewed and recommended upon by the SOFA 2 working group prior to Planning Commission review and City Council action. DEFiN TIONS Chapter 18.04 DEFINITIONS Sections: 18.04.010 18.04.020 18.04.030 Purpose and applicability. General rules for construction of language. Definitions. 18.04.010 Purpose and applicability. The purpose of this chapter is to promote consistency and precision in the interpretation of the zoning regulations. The meaning and construction of words and phrases defined in this chapter shall apply throughout the zoning regulations, except where the context of such words or phrases clearly indicates a different meaning or construction. (Ord. 3048 (part), 1978) 18.04.020 The following regulations: (a) (b) (c) (d) (e) (f) (g) (1) (2) (3) (h) (J) General rules for construction of language. general rules of construction shall apply to the text of the zoning The particular shall control the general. In case of any difference of meaning or implication between the text of any provision and any caption or illustration, the text shall control. The word "shall" is always mandatory and not discretionary. The word "may" is discretionary. References in the masculine and feminine genders are interchangeable. Words used in the present tense include the future, and words used in the singular include the plural, and the plural the singular, unless the context clearly indicates the contrary. The words "activities" and "facilities" include any part thereof. Unless the context clearly indicates to the contrary, the following conjunctions shall be interpreted as follows: "And" indicates that all connected items or provisions shall apply. "Or" indicates that the connected items or provisions may apply singly or in any combination. "Either...or" indicates that the connected items or provisions shall apply singly but not in combination. "District" means a general district or a combining district established by this title, unless otherwise indicated by specific reference to another kind of district. All public officials, bodies, and agencies to which reference is made are those of the city unless otherwise indicated. "City" means the. city of Palo Alto. (Ord. 3048 (part), 1978) 18.04.030 (a) Definitions. Throughout this title the following words and phrases shall have the meanings ascribed in this section. (1) "Abandon" means to cease or discontinue a use or activity without intent to resume, but excluding temporary or short-term interruptions to a use or activity during periods of remodeling, maintaining, or otherwise improving or rearranging a facility, or during normal periods of vacation or seasonal closure. (2)"Abutting" means having property or district lines in common. (3)"Accessory building" means a building, which is incidental to and customarily associated with a specific principal use or facility, and which meets the applicable conditions set forth in Chapter 18.88. 4O (4) (5) (6) (7) (8) (9) (10) (11) (12) (13) (14) (15) "Accessory dwelling" means a dwelling unit accessory to a principal use on a site and intended for occupancy by persons residing therein by reason of employment of one or more occupants on the same site. "Addition" means any construction, which increases the size of a building or facility in terms of site coverage, height, length, width, or gross floor area. "Administrative office services" means offices and service facilities performing headquarters, regional, or other level management and administrative services for firms and institutions. "Airport-related use" means a use providing aviation-related services typically ancillary to operations of an airport including, but not limited to, aircraft repair and maintenance, flight instruction, and aircraft chartering. "Alley" means a public or private vehicular way less than twenty-five feet in width affording a secondary means of vehicular access to abutting property. Reserved. Reserved. "Alteration" means any construction or physical change in the internal arrangement of rooms or the supporting members of a building or structure, or change in relative position of buildings or structures on a site, or substantial change in appearance of any building or structure. (A)"lncidental alteration" means any alteration to interior partitions or interior supporting members of a structure which does not increase the structural strength of the structure; any alteration to electrical, plumbing, heating, air conditioning, ventilating, or other utility services, fixtures or appliances; any addition, closing, or change in size of doors or windows in the exterior walls;, or any replacement of a building facade which does not increase the structural strength of the structure.- (B)"Structural alteration" means any alteration not deemed an incidental alteration. "Animal care" means a use providing grooming, housing, medical care, or other services to animals, including veterinary services, animal hospitals, overnight or short-term boarding ancillary to veterinary care, indoor or outdoor kennels, and similar services. "Automobile service station" means a use providing gasoline, oil, tires, small parts and accessories, and services incidental thereto, for automobiles, light trucks, and similar motor vehicles. The sale of food or grocery items or alcoholic beverages on the same site is prohibited except for prepackaged soft drinks, cigarettes, and snack foods either from automatic vending machines or in shelves occupying a floor area not to exceed forty square feet. "Automotive services" means a use engaged in sale, rental, service, or major repair of new or used automobiles, trucks, trailers, boats, motorcycles, recreational vehicles, or other similar vehicles, including tire recapping, painting, body and fender repair, and engine, transmission, air conditioning, and glass repair and replacement, and similar services. "Basement" means that portion of a building between floor and ceiling, which is fully below grade or partly below and partly above grade, but so located that the vertical distance from grade to the floor below is more than the vertical distance from grade to ceiling. 4]!. (16) (17) (18) (19) (20) *(21) "Below market rate (BMR) housing unit" means any housing unit sold or rented to low or moderate income persons pursuant to the city of Palo Alto’s below market rate program administered by the Palo Alto housing corporation, or a successor organization. "Bicycle parking space" means an area specifically reserved and intended for parking of a bicycle, accessible to the user independently of any other bicycle parking space, and including such additional features or conveniences as specified by this title. "Block" means any lot or group of contiguous lots bounded on all sides by streets, railroad rights-of-way, or waterways, and not traversed by any street, railroad right-of-way, or waterway. Reserved. Reserved. "Breezeway" means a building or specifiC portion thereof, not over 3.7 meters (twelve feet) in height at the ridge line, which connects two otherwise separate buildings, and which is not more than fifty percent enclosed at the perimeter, including the wall surfaces of the buildings so connected. *An illustration may be found at the end of this chapter in a printed edition of this code. (22) (23) (24) (25) (26) (27) "Building" means any structure used or intended for supporting or sheltering any use or occupancy. "Business or trade school" means a use, except a college or university, providing education or training in business, commerce, language, or other similar activity or .pursuit, and not otherwise defined as a home occupation or private educational facility. "Canopy" means any roof-like structure, either attached to another structure or freestanding, or any extension of a roof line, constructed for the purpose of protection from the elements in connection with outdoor living. "Cellar" means that portion of a building between floor and ceiling which is wholly or partly below grade and so located that the vertical distance from grade to the floor below is equal to or greater than the vertical distance from grade to ceiling. (24.5) "Carport" means a portion of a principal residential building or an accessory building to a residential use designed to be utilized for the shelter of one (1) or more motor vehicles, which is open (unenclosed) at the vehicular entry side and which has no more than two sides enclosed. "Change of use" means the replacement of an existing use by a new use, or a change in the nature of an existing use, but not including a change of ownership, tenancy, or management where the previous nature of the use, line of business, or other function is substantially unchanged. (See also subdivisions (A) through (F) of subsection (143) of this Section 18.04.030.) "Church" means a use providing facilities for regular organized religious worship and religious education incidental thereto, but excluding a private educational facility. A property tax exemption obtained pursuant to Section 3(f) of Article XIII of the Constitution of the State of California and Section 206 of the Revenue and Taxation Code of the State of California, 42 (28) (29) (30) (31) (32) (33) (34) (35) (36) (37) (38) (39) (40) (41) (42) (43) or successor legislation, constitutes prima facie evidence that such use is a church as defined in this section. Reserved. Reserved. Reserved. "College" or "university" means an educational institution of higher learning which offers a course of studies designed to culminate in the issuance of a degree as defined by Section 94302 of the Education Code of the State of California, or successor legislation. "Combining district" means a district established by this title, which may be applied to a lot or portion thereof only in combination with a general district. More than one combining district may apply to the same lot or portion thereof. "Commercial recreation" means a use providing recreation, amusement, exercise or entertainment services., including theaters, bowling lanes, billiard parlors, skating arenas, gymnasiums, exercise studios or facilities, fitness centers, health clubs or spas, martial arts studios, group movement instruction, and similar services, operated on a private or for- profit basis, but excluding uses defined as outdoor recreation services defined in subsection (107). "Community center" means a place, structure, area, or other facility used for and providing religious, fraternal, social and/or recreational programs generally open to the public and designed to accommodate and serve significant segments of the community. "Convalescent facility" means a use other than a residential care home providing inpatient services for persons requiring regular medical attention, but not providing surgical or emergency medical services. "Corporation yard" is defined in subsection (52). Reserved. "Court" means a.space open and unobstructed to the sky, located at or above grade level on a lot, and bounded on three or more sides by walls of a building. Reserved. Reserved. "Covered parking" means a carport or garage that provides full overhead protection from the elements with ordinary roof coverings. Canvas, lath, fiberglass, and vegetation are not ordinary roof coverings and cannot be used in providing a covered parking space. "Day care center" means a day care facility licensed by the state or county for non-medical daytime care. This term includes, but is not limited to, nursery schools, preschools and similar facilities. Day Care Home. (A) "Family day care home" means a home licensed by the state or county which regularly provides care, protection, and supervision of twelve or fewer children under the age of eighteen, in the provider’s own home, for periods of less than twenty-four hours per day, while the parents or guardians are away and includes the following: (i) "Large family day care home" means a home, which provides family care to seven to twelve children, inclusive, including children under age eighteen who reside at the home. This term 43 (43a) *(44) includes, but is not limited to, nursery schools, preschools, and similar facilities. (ii)"Small family day care home" means a home, which provides family day care to six or fewer children, including children under age eighteen who reside at the home. This term includes, but is not limited to, nursery schools, preschools, and similar facilities. (B)"Adult day care home" means use of a dwelling unit or portion thereof, licensed by the state or county, for daytime care and supervision of twelve or fewer persons, above the age of eighteen, and includes the following: (i) "Large adult day care home" means a home, which provides daytime care of seven to twelve adults. (ii)"Small adult day care home" means a home, which provides daytime care to six or fewer adults. "Family day care home" means use of a dwelling unit or portion thereof licensed by the state for daytime care of up to ten persons, including children through age sixteen within the family occupying such dwelling unit. This term includes nursery schools, preschools, and similar facilities. A family day care home for the elderly need not be state licensed. "Daylight plane" means an inclined plane, beginning at a stated height above average grade, that average grade being an average of the grade at the midpoint of the building and the grade at the closest point on the abutting site, and extending into the site at a stated upward angle to the horizontal, which may limit the height or horizontal extent of the building at any specific point where the daylight plane is more restrictive than the height limit applicable at such point on the site. The "daylight plane" shall be measured separately for each building on a lot, and separately for each side of each building. *An illustration may be found at the end of this chapter in a printed edition of-this code. (48) (49) (50) *(51) (45)"Drive-in service" means a feature or characteristic of a use involving sales of products or provision of services to occupants in vehicles, including drive-in or drive-up windows and drive-through services such as mechanical automobile washing. (46)"Dwelling unit" means a room or group of rooms including living, sleeping, eating, cooking, and sanitation facilities, constituting a separate and independent housekeeping unit, occupied or intended for occupancy by one family on a non-transient basis and having not more than one kitchen. (47)"Eating and drinking service" means a use providing preparation and retail sale of food and beverages, including restaurants, fountains, cafes, coffee shops, sandwich shops, ice cream parlors, taverns, cocktail lounges and similar uses. Related definitions are contained in subsections (45) and (136). Reserved. Reserved. Reserved. "Enclosed" means a covered space fully surrounded by walls, including windows, doors, and similar openings or architectural features, or an 44 open space of less than 9.3 square meters (one hundred square feet) fully surrounded by a building or walls exceeding 2.4 meters (eight feet) in height. *An illustration may be found at the end of this chapter in a printed edition of this code. (51.5) (52) (53) (54) (55) (56) *(57) "Envelope" means the three-dimensional spatial configuration of a building’s volume and mass. "Equipment yard" means a use providing for maintenance, servicing, or storage of motor vehicles, equipment, or supplies, or for the dispatching of service vehicles; or distribution of supplies or construction materials required in connection with a business activity, public utility service, transportation service, or similar activity. ’ "Equipment yard" includes a construction materials yard, corporation yard, vehicular service center or similar use. "Facility" means a structure, building or other physical contrivance or object. (A) "Accessory facility" means a facility, which is incidental to, and customarily associated with, a specified principal facility, and which meets the applicable conditions set forth in Chapter 18.88. (B)"Non-complying facility" means a facility which is in violation of any of the site development regulations or other regulations established by this title, but was lawfully existing on July 20, 1978, or any amendments to this title, or the application of any district to the property involved by reason of which adoption or application the facility became non- complying. (For the definition for "nonconforming use" see subsection (143)(B)). (C)"Principal facilities" means a main building or other facility, which is designed and constructed for or occupied by a principal use. "Family" means an individual or group of persons living together who constitute a bona fide single housekeeping unit in a dwelling unit. "Family" shall not be construed to include a fraternity, sorority, club, or other groupof persons occupying a hotel, lodging house, or institution of any kind. "Farmers’ market" means a market certified by the state or county agricultural commission under Title 3, Chapter 3, Article 6.5 of the California Administrative Code which allows direct retail sale by farms to the public of such items as fruits, vegetables, nuts, eggs, honey, nursery stock, cut flowers, live animals and inspected meats and seafood. "Financial service" means a use providing financial services to individuals, firms, or other entities. The term "financial service" includes banks, savings and loan institutions, loan and lending institutions, credit unions and similar services. "Floor area ratio" means the maximum ratio of gross floor area on a site to the total site area. *An illustration may be found at the end of this chapter in a printed edition of this code. (57.5)"Footprint" means the two-dimensional configuration of a building’s perimeter boundaries as measured on a horizontal plane at ground level. 45 (58) (59) (60) (61) (62) (63) (64) (64.5) (65) "Full cash value" has the meaning assigned to it in the Revenue and Taxation Code for property taxation purposes. Reserved. Reserved. "General business office" means a use principally providing services to individuals, firms, or other entities, including but not limited to real estate, insurance, property management, title companies, investment, personnel, travel, and similar services, and including business offices of public utilities or other activities when the service rendered is that customarily associated with administrative office services. "General district" means a district created by this title establishing basic regulations governing land use and site development. Not more than one general district designation shall apply to the same portion of a lot. "General business service" means a use engaged in sales, servicing, installation, and repair services, or the performance of activities and services of the general nature described in this section, including printing, blueprinting and publishing, commercial bakeries, creameries or catering, cabinetry and furniture repair, bulk cleaning and laundry services (including a service that provides cleaning or laundry services for cleaning and laundry stations on other sites), lumber, plumbing, electrical, sheet metal, and other construction and building materials, and automobile parts and supplies. "Grade" means the lowest point of adjacent ground elevation of the finished surface of the ground paving, or sidewalk, excluding areas where grade has been raised by means of a berm, planter box, or similar landscaping feature, unless required for drainage, within the area between the building and the property line, or when the property line is more than five feet from the building, between the building and a line five feet from the building. In building areas with natural slopes in excess of ten percent, "grade" shall mean the adjacent ground elevation of the finished or existing grade, whichever is lower. "Grandfathered" means a designation established by means of a "grandfather clause," exempting a class of uses or structures from the otherwise currently applicable provisions of this title, because such uses or structures conformed with earlier applicable provisions of this title, prior to the enactment of subsequent provisions. (A) "Gross floor area" means the total area of all floors of a building measured to the outside surfaces of exterior walls, and including the following: (i)Halls; (ii)Stairways; (iii)Elevator shafts; (iv)Service and mechanical equipment rooms; (v)Basement, cellar or attic areas deemed usable by the chief building official; (vi) Open or roofed porches, arcades, plazas, balconies, courts, walkways, breezeways or porticos if located above the ground floor and used for required access; (vii)Permanently roofed, but either partially enclosed or unenclosed, building features used for sales, service, display, storage or similar uses; 46 (viii)In residential districts, all roofed porches, arcades, balconies, porticos, breezeways or similar features when located above the ground floor. (B) Gross floor area shall not include the following: (i) Parking facilities accessory to a permitted or conditional use and located on the same site; (ii)Roofed arcades, plazas, walkways, porches, breezeways, porticos, and similar features not substantially enclosed by exterior walls, and courts, at or near street level, when accessible to the general public and not devoted to sales, service, display, storage or similar uses. (iii)Except in the CD District and in areas designated as special study areas, minor additions of floor area approved by the director of planning and community environment for purposes of resource conservation or code compliance, upon the determination that such minor additions will increase compliance with environmental health, safety or other federal, state or local standards. Such additions may include, but not be limited to, the following: a. Area designed for resource conservation, such as trash compactors, recycling and thermal storage facilities; b.Area designed and required for hazardous materials storage facilities, handicapped access or seismic upgrades; (iv)In commercial and industrial districts except in the CD District and in areas designated as special study areas, additions of floor area designed and used solely for on-site employee amenities for employees of the facility, approved by the director of planning and community environment, upon the determination that such additions will facilitate the reduction of employee vehicle use. Such additions may include, but not be limited to, recreational facilities, credit unions, cafeterias and day care centers. (C) In the R-1 and R-E single-family residence districts, "gross floor area" means the total covered area of all floors of a main structure and accessory structures greater than one hundred twenty square feet in area, including covered parking and stairways, measured to the outside surface of exterior walls, subject to the following exceptions: (i) Floor area where the distance between the floor and the roof directly above it measures 5.18 meters (seventeen feet) or more, shall be counted twice; (ii)Floor area where the distance between the floor and the roof directly above it measures 7.92 meters (twenty-six feet) or more shall be counted three times; (iii)Basements where the finished level of the first floor is not more than .91 meters (three feet) above the grade around the perimeter of the building foundation, shall be excluded from the calculation of gross floor area, provided that lightwells, stairwells and other excavated features comply with the provisions of Section 18.10.050(m), 18.12.050(o), 18.17.050(p), or 18.19.050(o), as applicable; and 47 (66) (67) (68) (69) (70) (71) (72) (73) (74) (75) (76) (77) (78) (79) (80) (iv)60.69 square meters (two hundred square feet) of unusable third floor equivalent, such as attic space, shall be excluded from the calculation of gross floor area. (v)Carports shall be counted toward the maximum allowable floor area ratio requirements. "Guest cottage" means an accessory building containing a lodging unit without kitchen facilities, and used to house occasional visitors or nonpaying guests of the occupants of a dwelling unit on the same site. "Height" means the vertical distance above grade to the highest point of the coping of a flat roof or to the deck line of a mansard roof or to the average height of the highest gable of a pitched or hipped roof, except that in the R-l, R-2 and RMD Districts the height of a pitched or hipped roof shall be measured to the height of the peak or highest ridge line. The height of a stepped or terraced building is the maximum height of any segment of the building. Reserved. Reserved. Reserved. "Home occupation" means an accessory activity conducted in a dwelling unit solely by the occupants thereof, in a manner incidental to residential occupancy, in accord with the provisions of this title. (For further provisions, see regulations for home occupations in Section 18.88.130.) "Hospital" means a facility providing medical, psychiatric, or surgical services for sick or injured persons primarily on an in-patient basis, and including ancillary facilities for outpatient and emergency treatment, diagnostic services, training, research, administration, and services to patients, employees, or visitors. "Hotel" means a facility containing rooms or groups of rooms, generally without individual kitchen facilities, used or intended to be used for use by temporary overnight occupants, whether on a transient or residential occupancy basis, and whether or not eating facilities are available on the premises. "Hotel" includes a motel, motor hotel, tourist court, or similar use, but does not include mobile home parks or similar use. "Impervious area" means the portion of land on a lot that is covered by structures, paved surfaces, uncovered porches or similar cover and is incapable of being penetrated by water under normal circumstances. "Kitchen" means a room designed, intended or used for the preparation of food. "Landscaping" means an area devoted to or developed and maintained with native or exotic plantings, lawn, ground cover, gardens, trees, shrubs, and other plant materials, decorative outdoor landscape elements, pools, fountains, water features, paved or decorated surfaces of rock, stone, brick, block, or similar material (excluding driveways, parking, loading, or storage areas), and sculptural elements. "Liquor store" means a use requiring a State of California "off-sale general license" (sale for off-site consumption of wine, beer, and/or hard liquor) and having fifty percent or more of total dollar sales accounted for by beverages covered under the off-sale general license. Reserved. Reserved. Reserved. 48 (81) (82) (83) (84) "Loading space" means an area used for loading or unloading of goods from a vehicle in connection with the use of the site on which such space is located. "Lodging" means the furnishing of rooms or groups of rooms within a dwelling unit or an accessory building to persons other than members of the family residing in said dwelling unit, or in the case of an accessory building, a dwelling unit on the same site, for overnight occupancy on a residential occupancy basis, whether or not meals are provided to such persons. Lodging shall be subject to the residential density requirements of the district in which the use is located. "Lodging unit" means a room or group of rooms not including a kitchen, used or intended for use by overnight occupants as a single unit, whether located in a hotel or a dwelling unit providing lodging. Where designed or used for occupancy by more than two persons, each two-person capacity shall be deemed a separate lodging unit. For the purpose of determining residential density, each two lodging units shall be considered the equivalent of one dwelling unit. "Lot" or "site" means a parcel of land consisting of a single lot of record, used or intended for use under the regulations of this title as one site for a use or group uses. *(A)"Corner lot" means a lot abutting two or more streets having an angle of intersection of one hundred thirty-five degrees or less. A lot abutting on a curved street or streets shall be considered a corner lot if straight lines drawn from the intersections of the side lot lines with the street lines to the midpoint of the street frontage meet at an interior angle of one hundred thirty-five degrees or less. *An illustration may be found at the end of this chapter in a printed edition of this code. *(B)"Flag lot" means an interior lot on which the buildable area is located to the rear of a lot abutting a street, and which has access to the same street by means of a narrow driveway. *An illustration may be found at the end of this chapter in a printed edition of this code. *(C)"lnterior lot" means a lot abutting one street. *An illustration may be found at the end of this chapter in a printed edition of this code. *(D)"Through lot" means a lot other than a corner lot abutting more than one street. *An illustration may be found at the end of this chapter in a printed edition of this code. (85)"Lot area" means the area of a lot measured horizontally between bounding lot lines, but excluding any portion of a flag lot providing access (86) *(87) to a street and lying between a front lot line and the street, and excluding any portion of a lot within the lines of any natural watercourse, river, stream, creek, waterway, channel, or flood control or drainage easement and excluding any portion of a lot within a street right-of-way whether acquired in fee, easement, or otherwise. "Lot coverage" encompasses the following definitions: (A) "Single-family residential use" means the total land area within a site that is covered by buildings, including all projections except the exterior or outermost 1.2 meters (four feet) of any eave or roof overhang, but excluding ground level paving, landscaping features, and open recreational facilities. (B) "All other uses except single-family residential" means the total land area within a site that is covered by buildings, excluding all projections, ground level paving, landscaping features, and open recreational facilities. (C) Except in the CD District and areas designated as special study areas, the director of planning and community environment may permit minor additions of floor area to facilities that exceed lot coverage limits, for purposes of resource conservation or code compliance, upon the determination that such minor additions will increase site compliance with environmental health and safety standards. Such additions may include, but not be limited to, the following: (i) Area designed for resource conservation, such as trash compactors, recycling and thermal storage facilities; (ii)Area designed and required for hazardous materials storage facilities, handicapped access and seismic upgrades. (D) In commercial and industrial districts except in the CD District and in areas designated as special study areas, the director of planning and community environment may permit additions of floor area that exceed lot coverage limits upon the determination that such additions are designed and used solely for providing on-site employee amenities for employees of the facility and will facilitate the reduction of employee vehicle use. Such additions may include, but not be limited to, recreational facilities, credit unions, cafeterias and day care facilities. "Lot depth" means the horizontal distance from the midpoint of the front lot line to the midpoint of the rear lot line, or to the most distant point on any other lot line where there is no rear lot line. *An illustration may be found at the end of this chapter in a printed edition of this code. (88)Reserved. (89)Reserved. (90)Reserved. (91)"Lot line" means any boundary of a lot. *(A)"Front lot line" means, on an interior lot, the lot line abutting a street, or, on a corner lot, the shorter lot line abutting a street, or, on a through lot, the lot line abutting the street providing the primary access to the lot, or, on a flag lot, the interior lot line most parallel to and nearest the street from which access is obtained. 50 *An illustration may be found at the end of this chapter in a printed edition of this code. *(B)"lnterior lot line" means any lot line not abutting a street. *An illustration may be found at the end of this chapter in a printed edition of this code. *(C)"Rear lot line" means the lot line not intersecting a front lot line which is most distant from and most closely parallel to the front lot line. A lot bounded by only three lot lines will not have a rear lot line. *An illustration may be found at the end of this chapter in a printed edition of this code. *(D)"Side lot line" means any lot line which is not a front or rear lot line. *An illustration may be found at the end of this chapter in a printed edition of this code. *(E)"Street lot line" means any lot line abutting a street. *An illustration may be found at the end of this chapter in a printed edition of this code. (92) *(93) "Lot of record" means a lot which is part of a subdivision recorded in the office of the county recorder, or a lot or parcel described by metes and bounds which has been so recorded. "Lot width" means the horizontal distance between side lot lines, measured at the required front setback line. *An illustration may be found at the end of this chapter in a printed edition of this code. (94) (95) "Manufacturing" means a use engaged in the manufacture, predominantly from previously prepared materials, of finished products or parts, including processing, fabrication, assembly, treatment, and packaging of such products, and incidental storage, sales, and distribution of such products, but excluding basic industrial processing of extracted or raw materials, processes utilizing inflammable or explosive materials (i.e., materials which ignite easily under normal manufacturing conditions), and processes which create hazardous or commonly recognized offensive conditions. "Medical office" means a use providing consultation, diagnosis, therapeutic, preventive, or corrective personal treatment services by doctor, dentists, medical and dental laboratories, and similar practitioners of medical and healing arts for humans, licensed for such practice by the state of California and including services related to medical research, testing and analysis but excluding use of hazardous materials in excess of allowances contained in Title 17 of this code. (96)"Mobile home (manufactured housing)" means a structure, transportable in one or more sections, which is built on a permanent chassis and designed to be used as a dwelling with or without a permanent foundation when connected to the required utilities, and including the plumbing, heating, air-conditioning, and electrical systems contained therein. (97)"Mobile home park" means a residential facility arranged or equipped for the accommodation of two or more mobile homes, with spaces for such mobile homes available for rent, lease, or purchase, and providing utility services and other facilities either separately or in common to mobile home spaces therein. (98)Reserved. (99)Reserved. (100)Reserved. (101)"Motel" is defined in subsection (73). (102)"Multiple-family use" means the use of a site for three or more dwelling units, which may be in the same building or in separate buildings on the same site. (102.5)"Neighborhood business service" means a use occupying two thousand five hundred square feet or less, which is engaged in sales, servicing, installation and repair service, excluding vehicular repair and service, which does not generate noise, fumes or truck traffic greater than that normally associated with neighborhood-serving uses, or the performance of activities and services of the general nature described in this section, Such uses may include, but not be limited to, reproduction and copying, catering, cleaning, laundry services, home repair and remodeling supplies and sales, cabinetry and furniture repair. (103)"Neighborhood recreational center" means a privately owned or operated use providing, primarily for residents of the surrounding area, facilities for recreational or cultural activities, including lessons and instructions incidental thereto. (104)"Net floor area" means the net enclosed floor area used or capable of use for any activity, excluding walls, stairways, elevator shafts, service and mechanical equipment rooms, corridors or halls providing common access to more than one use, and unenclosed porches or balconies. (105)"Open" means a space on the ground or on the roof of a structure, uncovered and unenclosed. (106)"Opposite," as used with respect to relative location of two sites, means property which is separated less than 30.5 meters (one hundred feet) by a street, alley, creek, drainage-way, or other separately owned right-of- way, and which would be considered abutting based on projection of side lot lines to the centerline of such separating right-of-way. (107)"Outdoor recreation service" means a privately owned or operated use providing facilities for outdoor recreation activities, including golf, tennis, swimming, riding, or other outdoor sport or recreation, operated predominantly in the open, except for accessory or incidental enclosed services or facilities. (108)Reserved. (109)Reserved. (110)"Parking as a principal use" means a use providing parking and storage of motor vehicles on a profit or nonprofit basis, as a principal use and not accessory to a permitted or conditional use. (111) (112) (113) (114) (115) (116) "Parking facility" means an area on a lot or within a building, or both, including one or more parking spaces, together with driveways, aisles, turning and maneuvering areas, clearances, and similar features, and meeting the requirements established by this title. "Parking facility" includes parking lots, garages, and parking structures. (A)"Temporary parking facility" means parking lots which are not required under this chapter and which are intended as interim improvements of property subject to removal at a later date. "Parking space" means an area on a lot or within a building used or intended for use for parking of a motor vehicle, having permanent means of access to and from a public street or alley independently of any other parking space, and located in a parking facility meeting the requirements established by this title. "Parking space" is equivalent to the term "parking stall" and does not include driveways, aisles, or other features comprising a parking facility as defined in this chapter. "Patio cover" is defined in subsection (24), Canopy. "Personal service" means a use providing services of a personal convenience nature, and cleaning, repair or sales incidental thereto, including: (A)Beauty shops and barbershops; (B)Shoe repair; (C)Self-service laundry and cleaning services; laundry and cleaning pick-up stations where all cleaning or servicing for the particular station is done elsewhere; and laundry and cleaning stations where the cleaning or servicing for the particular station is done on site, utilizing equipment meeting any applicable Bay Area Air Quality Management District requirements, so long as no cleaning for any other station is done on the same site, provided that the amount of hazardous materials stored does not at any time exceed the threshold which would require a permit under Title 17 (Hazardous Materials Storage) of this code; (D)Repair and fitting of clothes and personal accessories; (E)Quick printing services where printing for the particular service is done on site, so long. as no quick printing for any other printing service is done on the same site; (F)Copying services; (G)Film processing shops, including shops where development processing for the particular shop is done on site, so long as no development processing for any other shop is done on the same site; (H) Art, dance or music studios. "Private educational facility" means a privately owned school, including schools owned and operated by religious organizations, offering instruction in the several branches of learning and study required to be taught in the public schools by the Education Code of the State of California. "Professional office" means a use providing professional or consulting services in the fields of law, architecture, design, engineering, accounting, and similar professions, including associated product testing and prototype development, but excluding product manufacturing or assembly 53 (117) (118) (119) (120) (121) (122) (123) (124) (125) and excluding use of hazardous materials in excess of the allowances contained in Title 17 of this code. "Projection" means architectural elements, not part of the main building support, that cantilever from a single building wall or roof, involving no supports to the ground other than the one building wall from which the element projects. "Property" means real property which includes the land, that which is affixed to the land, and that which is incidental or appurtenant to the land, as defined in Civil Code Sections 658 - 662. "Queue line" means an area for parking and lining of motor vehicles while awaiting a service or other activity. "Recreational vehicle" means a vehicle towed or self-propelled on its own chassis or attached to the chassis of another vehicle and designed or used for temporary dwelling, recreational 0r sporting purposes. The term "recreational vehicle" includes, but is not limited to, travel trailers, pickup campers, camping trailers, motor coach homes, converted trucks and buses and boats and boattrailers. "Recycling center" means facilities appurtenant and exterior to an otherwise allowed use, which are utilized for collection of recyclable materials such as metal, glass, plastic, and paper stored in mobile vehicles or trailers, permanent storage units, or in bulk reverse vending machines exceeding fifty cubic feet in size. "Religious institution" means a seminary, retreat, monastery, conference center, or similar use for the conduct of religious activities, including accessory housing incidental thereto, but excluding a private educational facility. Any such use for which a property tax exemption has been obtained pursuant to Section 3(f) of Article XIII of the Constitution of the State of California and Section 206 of the Revenue .and Taxation Code of the State of California. or successor legislation, or which is used in connection with any church which has received such an exemption, shall be prima facie presumed to be a religious institution. "Research and development" means a use engaged in studyi testing, design, analysis, and experimental development of products, processes, or services, including incidental manufacturing of products or provisions of services to others. Residential care home" means use of a dwelling unit or portion thereof licensed by the state of California or county of Santa Clara, for care of up to six persons, including overnight occupancy or care for extended time periods, and including all uses defined in Sections 5115 and 5116 of the California Welfare and Institutions Code, or successor legislation. "Retail service" means a use engaged in providing retail sale, rental, service, processing, or repair of items primarily intended for consumer or household use, including but not limited to the following: groceries, meat, vegetables, dairy products, baked goods, candy, and other food products; liquor and bottled goods, household cleaning and maintenance products; drugs, cards, and stationery, notions, books, tobacco products, cosmetics, and specialty items; flowers, plants, hobby materials, toys, household pets and supplies, and handcrafted items; apparel, jewelry, fabrics, and like items; cameras, photography services, household electronic equipment, records, sporting equipment, kitchen utensils, home furnishing and appliances, art supplies and framing, arts and antiques, 54 (126) *(127) paint and wallpaper, carpeting and floor covering, interior decorating services, office supplies, musical instruments, hardware and homeware, and garden supplies; bicycles; mopeds and automotive parts and accessories (excluding service and installation); cookie shops, ice cream stores and delicatessens. (A) "Extensive retail service," as used with respect to parking requirements, means a retail sales use having more than seventy- five percent of the gross floor area used for display, sales, and related storage of bulky commodities, including household furniture and appliances, lumber and building materials, carpeting and floor covering, air conditioning and heating equipment, and similar goods, which uses have demonstrably low parking demand generation per square foot of gross floor area. (B)"Intensive retail service" as used with respect to parking requirements, means any retail service use not defined as extensive retail service. "Reverse vending machine" means a mechanical device which accepts one or more types of empty beverage containers and issues a cash refund or credit slip. "Screened" means shielded, concealed and effectively hidden from view at an elevation up to 2.4 meters (eight feet) above ground level on adjoining sites, or from adjoining streets, within 3.0 meters (ten feet) of the lot line, by a fence, wall, hedge, berm, or similar structure, architectural or landscape feature, or combination thereof. *An illustration may be found at the end of this chapter in a printed edition of this code. (128) (129) (130) (131) (132) (133) (134) "Setback line" means a line within a lot parallel to a corresponding lot line, which is the boundary of any specified front, side or rear yard, or the boundary of any public right-of-way whether acquired in fee, easement, or otherwise, or a line otherwise established to govern the location of buildings, structures, or uses. Where no minimum front, side or rear yards are specified, the setback line shall be coterminous with the corresponding lot line. (See Chapter 20.08 of the Palo Alto Municipal Code for setback map regulations.) Reserved. Reserved. "Shopping center" means a group of commercial establishments, planned, developed, owned, or managed as a unit, with off-street parking provided on the site, and having a total gross floor area of not less than 92,903 square meters (one million square feet) and a total site area of not less than 20.3 hectares (fifty acres). "Single-family use" means the use of a site for only one dwelling unit. "Site" is defined in subsection (84). "Structure" means that which is built or constructed, an edifice or building of any kind, or any piece of work artificially built up or composed of parts joined together in some definite manner. (For further provisions, see the definition for "facility," subsection (53).) 55 (135) (136) (137) .(138) (139) (140) (141) (144) *(145) "Studio dwelling unit, efficiency dwelling unit" means a dwelling unit consisting of a single habitable room for living and sleeping purposes, plus ancillary kitchen and bath facilities. "Take-out service" means a characteristic of an eating or drinking service which encourages, on a regular basis, consumption of food or beverages, such as prepared or prepackaged items, outside of a building, in outdoor seating areas where regular table service is not provided, in vehicles parked on the premises, or off-site. "Transportation terminal" means a depot, terminal, or transfer facility for passenger transportation services. Reserved. Reserved. Reserved. "Two-family use" means the use of a site for two dwelling units, which may be within the same building or separate buildings. (A) Specified principal use, and which meets the applicable conditions set forth in Chapter 18.88. (B)"Nonconforming use" means a use which is not a permitted use or conditional use authorized within the district in which it is located, but which was lawfully existing on July 20, 1978, or the date of any amendments hereto, or the application of any district to the property involved, by reason of which adoption or application the use became nonconforming. (For further provisions, see the definition of "non-complying facility" in subsection (53).) (C)"Principal use" means a use, which fulfills a primary function of a household, establishment, institution, or other entity. (D)"Permitted use" means a use listed by the regulations of any particular district as a permitted use within that district, and permitted therein as a matter of right when conducted in accord with the regulations established by this title. (E)"Conditional use" means a use, listed by the regulations of any particular district as a conditional use within that district and allowable therein, solely on a discretionary and conditional basis, subject to issuance of a conditional use permit, and to all other regulations established by this title. (F) "Change of use" is defined in subsection (26). "Warehousing" and "distribution" means a use engaged in storage, wholesale, and distribution of manufactured products, supplies, and equipment, but excluding bulk storage of materials which are inflammable or explosive or which create hazardous or commonly recognized offensive conditions. "Watercourse bank" means the side of a watercourse the top of which shall be the topographic line roughly parallel to stream centerline where the side slopes intersect the plane of the ground traversed by the watercourse. Where banks do not distinguishably end, the surrounding country being an extension of the banks, the top of such banks shall be defined as determined by the building official. *An illustration may be found at the end of this chapter in a printed edition of this code. 56 (146)"Yard" means an area within a lot, adjoining a lot line, and measured horizontally, and perpendicular to the lot line for a specified distance, open and unobstructed except for activities and facilities allowed therein by this title. *(A)"Front yard" means a yard measured into a lot from the front lot line, extending the full width of the lot between side lot lines intersecting the front lot line. *An illustration may be found at the end of this chapter in a printed edition of this code. *(B) "Interior yard" means a yard adjoining an interior lot line. *An illustration may be found at the end of this chapter in a printed edition of this code. *(c)"Rear yard" means a yard measured into a lot from the rear lot line, extending between the side yards; provided, that for lots having no defined rear lot line, the rear yard shall be measured into the lot from the rearmost point of the lot depth to a line parallel to the front lot line. *An illustration may be found at the end of this chapter in a printed edition of this code. *(D)"Side yard" means a yard measured into a lot from a side lot line, extending between the front yard and rear lot line. *An illustration may be found at the end of this chapter in a printed edition of this code. *(E) "Street yard" means a yard adjoining a street lot line. *An illustration may be found at the end of this chapter in a printed edition of this code. (147)"Youth club" means a recreational use, operated on a profit or nonprofit basis, for supervised youth involving dancing or social gathering as a principal activity but prohibiting sale or consumption of alcoholic beverages. (Ord. 4472 § 2, 1998: Ord. 4140 §§ 2, 3, 4, 1993: Ord. 4081 § 4, 1992: Ord. 4043 § 1, 1991: Ord. 4016 §§ 2-6, 1991: Ord. 3905 §§ 2, 3, 4, 1989: Ord. 3896 §§ 1, 2, 3, 1989: Ord. 3890 § 1, 1989: Ord. 3850 § 5, 1989: Ord. 3807 § 16, 1988: Ord. 3783 § 1, 1987: Ord. 3757 §§ 1 - 4, 1987: Ord. 3735 §§ 1, 23, 24, 1987; Ord. 3703 §§ 1 - 5, 9, 1986: Ord. 3683 § 1, 1986: Ord. 3632 §§ 1, 2, 1985: Ord. 3584 § 1, 1984: Ord. 3583 §§ 27 - 28, 1984: Ord. 3536 §§ 1, 2, 27 - 30, 1984: Ord. 3465 §§ 29, 30, 1983: Ord. 3349 § 1, 1982: Ord. 3345 §§ 1, 5, 9, 10, 11, 19, 20, 1982: Ord. 3340 §§ 1, 2, 6, 7, 1982: Ord. 3291 § 1, 1981: Ord. 3255 §§ 1 and 3, 1981: Ord. 3187 §§ 7, 8, 9, 10, 1980: Ord. 3130 §§ 1 (part), 15 (part), 23, 25 (part), 1979: Ord. 3108 §§ 3, 13, 14, 16, 1979: Ord. 3103 § 1, 1979; Ord. 3064 § 1 (part), 1978: Ord. 3048 (part), 1978) Attachment ORDINANCE NO, 46"26 ORDINANCE OF THE COUNCIL OF. THE" CITY OF ’PALO ~LTO ADOPTING OF THE SOUTH OF FOREST’ AREA COORDINATED "~ AREA" PLAN, PHASE 1 ’ The Council follows~ SECTYON i. of .the City o~ .Palo Alto’ "does ORDAIN as The City Co.uncll finds as follows: A.In 1996~. the City of ~alo Alto’approved ’land:use entitlements that permitted the Palo Alto.Medical. Foundation to relocate within the City to the Urban L~ne Area, provide~ that., among otherthings, the’~alo AitQ Medical Foundation ~artic±pated in a .plan~ing process to govern redevelopment .and reuse ~ the South of Forest Area’. B.’In 1998,’ the cit9 Council adopted the 1998-2.010 Comprehensive Plan. In Program L-22, the. C~mprehensive Plan cailed for preparation of a Coordinated. Area’Plan for the SOFA and Palo Alto Medical.Foundation site. Palo Alto Municipal Code,. Cha~ter 19~I0. authorized .preparation of Coordinated Are.a Plans. .. Coord.inatedArea Plans ("CAPs") .are intend~ to ’be used to.facil~tate nei’ghbor~ood based Plann.ing for ~he Use and.re- use of land a~d biildings. The plrposes of aCAP are described by Pal’o Alto Municipal Code sectioh 19oi0.010 as’follows: "(a) To Crea.te .enhanced’ opportunities for building a sense of community through public involvement in’ planning processes which are. designed not o~ly to satisfy constitutional due process requirements, but also to provideresidents, "and. business and property owners with early, meaningful "opportunities to help .shape the physica ~l components of their neighborhood~ ’and co.mmuni ty. (b) To ~ empha~ize and enhance ~rchitebtural. ¯ qualities,., public improvements, .and. site .design by.providing a graphic, " visual linkage between policies and programs established, in the Comprehensive Plan and . specific development entitlements an’d public. improvements. (c) To facilitate physical change by each of the foll~ o~.ing methods: 1 I) ~ccelera.ting and c~ordinating the .plann. lng "proces.s :wlthin ’selected areas so .that private development "and .re-use can proceed. und4r streamlined City review, prbcesses.. 2) Encouragi’ng rationi’l private investment "by providing specific, dependable information a..bout the design requirements, development standards, and uses allowed on a particular’, site ~ 3~’ .Analy~ing and considering the economic en.v~ronm~nt So t.hat the planning process . works in conjunction, with the market.place, rather than independent, of it. 4) Coordinating and timing public." infrastructure .. idvestmen~" .to facilitate deNirable private land uses. ¯ (d) .To ,assure Palo Alto’s . environmentalquality by usihg . the Comprehensive .Plan’ Environmenta’l Impact Report to focus environmental review on area and "slteLspecific issu4s and’changed circumstances. ¯ (e) TO " facilitate orderly and consistent implementation, of the City’s. o.mpr..ehens. ive Plan" .. D. The City Council has conducted a public hearing .on the SOFA Coordinated Area Plan. . E.The City Coun~il has .reviewed and considered the i~formati0n contained in the SOFA CAP Final’ Environmental Impact Report, has certified th~ .adequacy of t~e EIR, .and has made finding~ upon the significant environmental impacts identified in the EIR. F.Th~ City Council finds and d4termines that the SOFA CAP,. Phasel is consistent with the Comprehensive Plan of the’City of Palo. Alto, as. amended] .The City Council has specifically’ considered the~regional wel~are’ and the impacts of the development agreement upon the regiona~ welfare. The City Council finds and determines that the behefits of the project-set forth in the EIR 2 000413 sd100524~7 and CAP estab~.ish.the reasonable’reiatio~sh~p of the projeht ~to the regional Welfare" G. The ~ity Council has specifically considered and hgre~y approves integrat.ion of.the SOFA-CAP with the hity’s Capital. Improvement Program in order to’ assure timely implementation of the public impro~ement¯s set forth in the’CAP, i The City Council has specifically c~nsidered the econ0mic~and fiscal feasibility of the SOFA CAP in light of market olace factors and ihcenti~es and disincentives to the desired~ development product,~ as well as a Cost-benefit .analys’is of the public infrastructure investments andprojecte~ economic benefits to the city and .co.mmunity, and. hereby finds and determines as follows: i. The proposed development is .~c~nomically feasible under current market condi~¯ions; 2.. ’The development intensity, proposed .is warranted, by current land costs and the substantial land dedications .for par~s .and-affordable housing; 3. The¯ public infrastructure investment Of approximately $10,000,0.00 will result in th~ ~ity acquiring a total.of 2.41 acres¯ of land and the historic Roth building for park., affordable hQusing and public facility Purposes. This public investment is warrantid by the"City’s need for affordable housing.and parkland. In addition, 1.5 acres¯ of the 2.41 total are.being dedicated ~ithout costtothe City. I.The City Council hereby finds %hat the adoption of. the .SOFA CAP, ’Phase 1 will serve the public interest,’ health,safety aDd~general welfare. .. ..SECTION 2...The SOFA CAP, Phase ~ ~hall be ~eemed to include the following documents: SOFA cAP, Phase 1 plan.attached as.Exhibit’"A;" Conditions of Approval attached as Exhibit All environmental mitigation measures identified in the¯accompanying:Resolution of the Councilof the City. of Palo.Alto Certifying the Adequacy of the South of F6rest Area Coordinated Area Plan ~inal .FIR and Making Finding~ Thereon Pursuant to the Califbrnia Environmental Quality Act; This .Ordinance Adopting the South of Forest Area Coordinated Area~Plan, Phase i; 000413 sd[ 00~2487 The Errata sieet dated April. 5,. ’2000 and attached as Exhibit. ~ C’" .and ¯ The. hity.. Council’g a~ditional, conditions and ’modifications as.approved on March 27, March 28, and.April i0, 2000, and s~own on Exhibit ~D." SECTION.3. Pha.se I. The’City Council. hereby a’p~r0ves’ the SOFA CAP, upon the.. SECTION 4. This Ordinance shall:be¯ ~ffective thirty-first (3-~~) day after its passage. and adoption. INTKODOCED :March 28, 2000 PASSED: AYES: NOE~: April i0, 2000. BEECHAM, BuRCH, FAZZINO, KLEINBEKG, KNISS ~ossAP, /iBSENT: EAKINS, LYT~E ~BSTENTIONS: ’ NOT PARTICIPATING ’ OJAKIAN ATTEST :"’ ’¯ Ci ~y Manager ’ and Community. Envi ronment 000413 sdl 0052487 4 EXHIBIT B - COINDITIOINS OF APPROVAL In addition to the specific development conditions enumerated below, the private development of properties subject to the Development Agreement between City of Pale Alto, a chartered city and Pale Alto Medical Foundation for Health Care, Research and Education, a California corporation, shall be in compliance with applicable land use requirements that would normally be applied to said private development. These shall include, but not be limked to: e Title 8, Trees and Vegetation, of the Pale Alto Municipal Code (PAmC); ¯Title 12, Public Works and Utilities, of the PAlViC; ¯Title 15, Fh’e.Prevention, of the PAMC; ¯ ¯Title 16, Building Reg-ulations, of the PAIVIC; Title I?, Hazardous Materials Storage mud Handling, of the PAMC; . Title I 8, Zoning of the PA.hdC; ® Title 21, Subdivisions and Other Divisions of Land oft he Pale Alto Municipal Code (PAMC), and; The Pale Alto Comprehensive Plan, as m-ncnded, to include the SOFA CAP. In addition to the requiremenls listed, the developer shall also be subject to tl-le following review process: " , All private development activities onthe blocks A, B, C, m~d H as described in Exhibit A ofthc DcvMopmcnt Agreement, shs!l be in c0mpliancc with the development standm’ds set forth in the AMP, .MUO/AMF, mud DHS designations, s_nd further shall be subject to the Design P~cview Committee process as described in the SOFA CAP. , All private development activities on blocks D, E, and F shall be subject to the development standards set forth in the DHS designation in the SOFA CAP, the City’s Compatibility Ouidelines, and review by the Director of Planning and Community Environment, All private development activities involving identified historic resources shall be in substantial compliance with the Secretary of Interior’s Stands_rds for Rehabilitation, as determined by the Director of Planning mud Community Environment. All construction activities in the public right-.of-way shall be completed to the satisfaction to the Director of Public Works and Director o f Utilitie s. The developer shall, if determined neccssm-y by the building official, contract with a qualified soils or geotechnical engineer to perform a detailed geotechnical study for any development proposed within the plmming ~rca. All mitigation measures identified in the geotcchnical report shall be implemented in order to reduce geologic-related impacts to a less than si=~nificant leve!, The gcotechnical report shall be subject to review and approval by the Pale Alto Building Division prior to grading activities. The ~teveloper shall inco~loorate Best Management Practices (BMP), as defined within Policy N-21 of the Comprehensive Plan, into project plans. Preparation of a stormwater pollution prevention plan identifying the specific BMP to be followed dm’ing the project is the responsibility of all future project developers. Incorporation of BMP shall be completed prior to grading permit approvals, subject to approval by the City Public Works Engineering Division. For all redevelopment projects on sites suspected by the City of containing. groundwater or soil contamination wit!in the planning area, the City shall require that the developer shall hire a qualified environmental testing company to collect and test ’random soil samples for analysis of soil and groundwater contamination. The environmental consultant, hired by the project proponent~ shall comply with all regulations governing sampling methodologies, shipping and handling procedures, and testing methodo.logies. The analysis shall comply with the plammd schedule and analytical procedures for providing the information specified in the State of. California Environmental Protection Agency Department of Toxic Substances Control’s Preliminary Endangerment Assessment (PEA). Validated data shall be submitted to the Santa Clara County Department of Health, the Santa Clara Valley Water District, and the State. of California Environmental Protection Agency. Department of Toxic Substances Control for review. In the event that contamination is discovered, affected soils shall be removed in compliance with all federal and state regulations governing clean-up procedures and disposal of hazardous materials. Clean up shall be certified as complete by the Santa Clara County Department of Health and the. Santa Clara Valley "~Vater District. All development shall be required to comply with the City of Pale Alto Fire Department standards and procedures for asbestos containing material. The developer shall prepare construction-recycling plans as part of the project approval process. The construction-recycling plan shall be implemented through explicit provisions in demolition and construction contracts. The construction recycling plans shall include the following specific steps: a) Recovery of concrete, asphalt, and other inert solids; b) P,.eco~ery of scrap metals; c) " Salvage of building fixtures and other re-usable items; and d) Siting containers at the construction site for cardboard, beverage containers, wood, and other recyclable materials. e)The construction-regycling plan shall be implemented through explicit prQvisions in demolition and construction contracts. 8.The developer shall prepare operation-recycling programs, as part of the individual project approval process. The on-going programs shall describe the proposed diversion rates for different material types and the location to which they will be ~liverted, as wel! as locations, areas, types of bins, etc. In addition, the program should contain the following specific information: a) Specific locations, square footage, and equipment that would be used to hold and handle recyclables (i.e.;.cardboard, compactors, glass bins, can bins, paper bins, etc.) and solid waste. b)The locations of containers within the retail facility near high volume pedestrian areas to encourage waste minimization and recycling; and c)Store layouts that incorporate space for the storage of recyclable material, principally cardboard, prior to its movement to another area for processing and transport. 9. The developer shall insure and provide specifications to preserve trees and landscaping protected by the Area Plan. The specifications shall require that all improvement and development plans use the Tree Preservation and Management regulations (PAMC 8.10) standards and specifications for: ¯Tree reports; ¯protection of trees during construction .replacement and planting of trees ¯maintenance of trees after construction The Area Plan shall include provisions for reforestation and revegetation of right- of-way planting areas. Species and specifications shall be consistent with Guidelines for Tree Management & Removal Program. All final construction plans for projects in the planning area shall be subject to review and approval by the City of Palo Alto Arborist prior to approval. 10.The SOFA CAP identifies the following structures as important historic resources: 1.The French Laundry Building at 260 Homer Avenue. 2.The AME Zion Church at 819 Ramona Street. 3.The Victorian structures at 737, 804,806, 840, and 846 Bryant Streets. 4. The Victorian structures at 260 and 270 Channing Street. The developer shall use the measures that would serve to reduce the extent of the impacts of the Area Plan on historic r~sources in the planning area, including, but not be limited to the following: a) Redevelopment of identified historic resources, including relocation, alteration and additions shall be completed to insure substantial compliance with the Secretary of Interior’s Standards for Rehabilitation. The Director of PIa.rming and Community Environment shall.determine substantial comptiaace. b)Rehabilitation of historic structures may include, but not be limited to, review by the.Design Review Committee, as determined by the director of Planning and Community environment. 11.~ the event that archacolo ~cal resources or human remains are discoverc.d during grading or construction activities, all work shall cease within ~ 50 feet of the find until it can be evaluated by a qualified, professional archae61ogist, If the find is determined to be significant, appropriate mitigation measures shall be developed and implemented in accordance with Appendix K of the CEQA Ouidelines. Any discoveries shall be reported to the City of Palo Alto Community Development Director for forwm’ding to the Historic Resources Board. 4 Attachment F PAMF/SOFA COORDINATED AREA PLAN POLICY FRAMEWORK ADOPTED BY CITY COUNCIL SEPTEMBER 22, 1997 GOALS AND OBJECTIVES FOR PLAN Design Character, Scale and Compatibility. Promote high quality design and construction that preserves and continues the existing character of the area, including the scale of development, the high degree of visual interest, and the variety of compatible land uses within a historic pattern. Facilitate implementation of the Plan by providing development standards and design guidelines to help ensure the compatibility of uses, to reduce potential conflicts and to provide for compatibility in character, scale and massing. Mixed Use Character and Compatibility Preserve and enhance the historically mixed-use character of the area. Identify appropriate and mutually compatible uses that provide vitality and convenience for residents, businesses and visitors. Economic Feasibility The Plan must be economically feasible and desirable in order to facilitate sale and redevelopment of Palo Alto Medical Foundation properties. Avoid potential negative impacts of vacant and underutilized facilities. Any City participation in project is subject to Council direction and competition from other City projects for City resources. Walkable Neighborhood Reinforcement of the neighborhood as a walkable area providing convenient access to services and facilities. Reduce Traffic Impacts Evaluate re-establishing Homer Avenue and Channing Avenue as two-way streets in order to reduce the speed and impact of traffic through this residential and mixed use neighborhood. Consider opportunities for establishment of new alleys and use of existing alleys consistent with the historic development pattern of the area. The replacement of a two-way couplet with two way streets may be more appropriate to the predominantly residential character envisaged for future use and integration of the PAMF sites with the adjacent neighborhoods. Transit and Bicycle Accessibility S: kPLANSP LADIV~CMRkP S OB JE C Take advantage of existing transit connections at the University Avenue multi-modal transit facility and access to local and regional destinations. Identify opportunities for improving existing service or adding new transit service. Coordinate with other studies on transit services. Promote increased bicycle use by commuters, residents, visitors and customers by reinforcing existing bicycle routes and providing safe and cohvenient bicycle parking and storage related facilities. ,~ Housing Provide a significant quantity of new housing, with residential use as the predominant land use for the former PAMF sites. Allow for the possibility of live-work and other. residential uses within the mixed use areas along Emerson, High and Alma Streets. Considering the unique assets of this area, its proximity to jobs and services and citywide and regional housing needs, allow a variety of housing types especially affordable housing. Historic Preservation Identify historically significant and contributing structures in the South of Forest Area and encourage the preservation and viable continued uses of landmark structures. Evaluate preservation and continued use of contributing structures that compose the heritage of the South of Forest Area. Recognize that in order to achieve other plan objectives, not all historical structures may be able to be preserved, and examine alternatives including preservation, alteration, demolition and relocation. Relationship to Downtown Commercial District Clarify the relationship between SOFA commercial and mixed use area and downtown. Reinforce the potential for complementary uses in the area that support the vitality of downtown uses serving the city and region. Plan for convenient neighborhood and local commercial uses and services, including automobile repair, hardware and sundries. Automobile Service and Other Service Uses Examine the special requirements of automobile service, convenience service and retail business requiring automobile access and parking, to determine measures to preserve the economic viability of these businesses while reducing impacts on adjacent uses. Heritage Trees, Street Trees and Landscaping Reinforce the overall pattern of significant street trees, and preserve heritage oaks and other large trees wherever possible as an important asset for future development and the neighborhood. Reinforce and continue other landscaping and planting patterns. S:kPLAN~LADIV~CMRkPSOB JEC Bicycle and Pedestrian Access across Caltrain Tracks Conduct feasibility study to thoroughly explore all possible means (over, under and across) for construction of a pedestrian and bicycle crossing of the Caltrain tracks to provide pedestrian and bicycle access from the downtown and South of Forest Areas to the Urban Lane area. Communi _ty Facilities Pursue opportunities for public facilities in the area including but not limited to open space, parks, plazas, child care, art, library and other such facilities. GOALS AND OBJECTIVES FOR THE PLANNING PROCESS: Working Group Role The role of the Working Group will be to advise the City Council, Planning Commission, Architectural Review Board (ARB), Historic Resources Board (HRB), Public Arts Commission (PAC), consultants and City staff on the issues, alternatives and substance of the PAMF/SOFA Coordinated Area Plan. The Council retains the ultimate decision making responsibility for policy direction, plan content and Plan adoption. The Working Group will meet approximately monthly to provide input, review and recommendations to the staff and consultants. Neither consensus nor voting is required of the Working Group. The Working Group will not have subcommittees but small task forces may be constituted for maximum 1 to 2 month periods to address specific issues in more depth. Product of Planning Process The Plan and associated documents will be prepared by City staff and consultants under the direction of the Chief Planning Official. The Plan shall be prepared in conformance with the Coordinated Area Plan Ordinance and particularly Section 19.10.040, Contents of Coordinated Area Plans. The Plan process will culminate in the preparation of the Coordinated Area Plan for the PAMF/SOFA .area that shall include: X Land Uses: A map designating all land uses consistent with the Comprehensive Plan and zoning or a recommendation for changes. The Plan shall describe all permitted and conditionally permitted uses and, for housing, minimum and maximum densities. X Parcels: A map showing parcel and lot configurations, including but not limited to size, orientation, easements and rights-of-way. X Infrastructure: Identification of public and private transportation, parks, open space, sewage, water, drainage, solid waste disposal, energy, sidewalks, plazas, S APLAN~LADIV~CMRkP SOB JEC street trees, landscaping, art and other public improvements existing and proposed for the area. X Site Design: A plan showing specific site design objectives, primarily for PAMF- owned parcels, including but not limited to building placement, orientation, maximum building footprints, setbacks, mass, height, daylight plane, floor area, lot coverage, open space and parking. ’ X Design Guidelines: Architectural design guidelines that address each land use type, street, park or public facility. Suggested typical or prototype elevations, facades, roof types and materials are to be included. X Feasibility: A determination of the economic and fiscal feasibility of the planwith specific analysis of market place factors and incentives and disincentives, as well as a cost-benefit analysis of public infrastructure investments and projected economic benefits to the City and community. X .Environmental: An Environmental Impact Report consistent with the requirements of the California Environmental Quality Act including alternatives to the Plan. X Implementation: A program of implementation measures to be coordinated with the City=s Capital Improvement Program and including development regulations, public works projects, application processing, infrastructure improvements and financing. Timeline for Plan Preparation The goal for preparation of the Plan is to be available for public review by the various City approving bodies by September 1, 1998 with an anticipated approval date no later that October 31, 1998. Planning Commission and City Council review and policy recommendations of Plan alternatives shall occur approximately half way through the process. Process for Approvals Upon Plan Adoption Upon plan adoption, development proposals in conformance to the Plan may be processed as minor Architectural Review Board applications including staff approvals, thus eliminating the requirement for further environmental review and HRB, ARB, Planning Commission or City Council. review. Development proposals found not to be consistent with the Plan, will be processed as amendments to the Plan requiring review the Planning Commission and City Council. S :kPLAN~PLADIV~CMRkPSOB JEC TENTATIVE SCHEDULE FOR PAMF/SOFA COORDINATED AREA PLAN (REVISED SEPTEMBER 1997) August 1997 Council initiated PAMF/SOFA Coordinated Area Plan September 1997 Working Group: Appointment by Council , Council adopts Policy Framework and Goals and Objectives Working Group: First meeting, review of Policy Framework, Establishment of schedule and meetings. October 1997 Staff interviews consulting teams & negotiates contract TAG: Staff Technical Advisory Group formed Working Group: Begin review of existing conditions November 1997 Consultant contract to Council TAG: Finalize data base and existing conditions Working Group: begin alternatives exploration December 1997 Working Group: Alternatives development TAG: Begin technical analysis of alternatives EIR - Notice of Preparation and scoping January 1998 Working Group: Alternatives Evaluation re Goals & Objectives TAG: comparative analysis of alternatives EIR: Describe baseline conditions, affected environment Community Update Forum: Comments on alternatives February 1998 Review and comment from Boards, Commission and Council on preferred alternative. EIR: Alternatives description March 1998 Working Group: Refine preferred alternative Consultant: Begin conceptual plan preparation EIR: Begin impact analysis April 1998 TAG: Review Administrative Draft Concept Plan and 60% EIR: Complete impact analysis Working Group: Preliminary Draft Plan review May 1998 Consultant: Conceptual Coordinated Area Plan for Public Review Working Group: Draft Plan review EIR: Administrative Draft review June 1998 Consultant: Revisions to Draft Plan Working Group: Implementation, capital improvements plan, guidelines & development standards review EIR: Produce Draft EIR July 1998 Consultant: Production of Final Draft Coordinated Area Plan EIR: Production of Draft EIR for Public Review August 1998 Public Review of Final Coordinated Area Plan Public Review of Comprehensive Plan Amendments and Zoning Amendments Public Review of Draft EIR Review/Approval: ARB, HRB/PAC, Planning Commission S :~LAN~PLADIV~CMR~ sob JEC September i 998 EIR: Certification of E!R Council Adoption of Coordinated Area Plan, Zoning Amendments and Comprehensive Plan S :kPLANkPLADIV~CMRkP SOB JEC Attachment G ~<~ ’-0 oo oo O 0 0 Attachment I I 0 0 0 0F- 0 h-0 ~,. 0 0 0 0 Z N ~8 0 .~. 0~J ~) ~O ~ o’~0 0 LU LU 0 0 tu 0 0 = Z × 0 0 h-Z 0 0 ,Z0 Z X 0 0 Z Z LU 0 0 ’~0o H 0 F- A~C, achrnen~ J MEMORANDUM TO: FROM: RE: DATE: Lisa Grote, City of Palo Alto Alexander Quinn, Senior Associate Matt Kowta, Principal SOFA II Economic Analysis = Draft Findings June 20, 2002 The purpose of this memorandum is to provide the analysis, findings, and conclusions regarding an Economic Analysis conducted for the preparation of Phase II of the South of Forest (SOFA) Coordinated Area Plan. Study Objective The City of Palo Alto retained BAE to evaluate the economic viability of proposed zoning amendments in the South of Forest Area (SOFA) Coordinated Area Plan, Phase II. This study has been prepared in response to a portion of the Coordinated Area Plan ordinance (No. 4454), which calls for planning efforts to include an analysis of economic conditions so that development plans work within the context of existing market conditions. The zoning alternatives include an option for a 1.15 Floor Area Ratio (FAR) maximum recommended by the SOFA Coordinated Area Plan Working Group, an alternative specifying a 1.5 FAR. maximum, proposed by City staff, and a third 2.5 FAR‘ alternative that was defined for the purposes of this analysis, to bracket the high end of potential SOFA Phase II area density. In addition, BAE evaluated the existing zoning (0.6 FAR.) as a baseline condition. For each of these zoning alternatives, the urban design fwm of Freedman, Tung & Bottomley (FTB) developed a series of illustrative development prototypes that served as the basis for BAE’s financial analysis. FTB created a development prototype for each FAR level for both a small and large site. For each of the different prototypes, BAE estimated the resulting residual land value. For the small site, BAE assumed a 10,500 square foot corner lot on Alma Street with approximately 9,800 auto-related building square. The large site was modeled after the small corner lot site plus the adjacent City owned parcel at 841 Alma Street, which currently is the site for a City electric utility substation. The small site and the City parcel combined provide 26,250 square feet of site area. Finally, BAE analyzed each development prototype assuming reduced parking requirements, in addition to standard parking requirements. In addition to analyzing the economics associated with the different density regulations, the City of Palo Alto also requested that BAE evaluate the economic viability of restrictions on ground floor office uses in certain portions of the SOFA II area. Specifically, the Working Group proposal would limit ground floor office to 2,500 square feet on any single parcel, with a maximum of 5,000 total square feet ofofficel including upper floor office spaces. The Working Group proposal would also prohibit ground floor office, including medical and professional Sacramento Region Office 530.750.2195 740 G Street 539.750.2194 fax Davis, CA 956516 bayareaeconomics.com Headquarters 510.549.7310 along Emerson Street and Homer Avenue and general business and office on ground floor south of Homer except Alma Street. BAE evaluated the general demand for retail space within the SOFA Phase II area and the viability of retail uses within specific corridors of the SOFA Phase II area. Study Approach As background for the economic analysis, BAE researched existing market conditions for ¯ office, retail, rental residential, and for-sale condominiums within the vicinity of SOFA. The market information provided BAE with an estimate of the current balance of supply and demand for these land uses as well as for the revenue potential that might be associated with new development. BAE also collected development cost and operating cost inputs from local developers, lenders, contractors, and insurers. Using the findings from the market research and these additional inputs, BAE created a pro-forma analysis for each development prototype. The pro-forma analyses estimate the residual land value or -in other words- the value of the land remaining after accounting for the cost to develop each prototype. The residual land value represents the amount a developer would need to pay for a given piece of property upon which to build the specified development prototype, while allowing for a reasonable profit. After calculating the land residual value, BAE then evaluated the general economic feasibility of the various zoning alternatives for the small and large sites, considering the current economic value of the sites in their current condition. The result provides an analysis of the zoning alternatives and whether the alternatives offer sufficient economic incentive to land owners and developers to redevelop property within the area. For a development prototype for which BAE estimated .that the residual land value is higher than the current economic value of the site, BAE deemed the zoning alternative to be economically feasible. In addition to our own market survey, BAE also reviewed the South of Forest Area - West Retail Market Study (Wallace & Steichen, Inc., June 2001) on the City’s behalf to assess the economic viability of restrictions on ground floor office uses in the SOFA II area. Limiting Conditions The following limiting conditions apply to this memorandum and the BAE analysis conducted for the study: All development program assumptions for each scenario (e.g., number of residential units, parking square footage, etc.) were provided to BAE and are considered reliable Most of the assumptions used in the BAE financial analysis could change over time, depending on market and economic conditions. These assumptions include construction loan interest rates and loan-to-value ratios, development ’project revenue, construction costs, City fees and tax assessments, etc. Sacramento Region Office 740 G Street Davis, CA 956516 Headquarters 530.750.2195 539.750.2194 fax bayareaeconomics.eom 510.549.7310 The BAE analysis did not involve in-depth market analysis of future demand for retaill housing, or office space. The availability of on-street parking for new commercial space (e.g., office or retail) in the Plan area was not analyzed or considered in the BAE work. The BAE analysis did not include an assessment of any physical development constraints in the Plan area such as potential environmental contamination, easements, infrastructure capacity, etc. The BAE analysi$~d~also~not assess highest and best use for any particular parcel. Development Prototypes As discussed previously, BAE, FTB, and the City of Palo Alto’s Planning and Community Environment Department created development prototypes for three zoning alternatives, each with a standard parking alternative and a reduced parking alternative. In general, FTB created development prototypes that maximized the allowable floor area ratio by specifying large three bedroom-two bathroom residential units of approximately 1,500 square feet each, in addition to the allowable commercial building floor area. In certain cases, FIB was unable to utilize the parcel to its fullest allowed FAR because the site could not fit the required parking. For example, FTB could only fit 16 residential units with 58 parking spaces in the 1.5 FAR standard parking altemative on the large site but could fit 22 units and 52 parking spaces in the 1.5 FAR reduced parking altemative for the same large site (See Appendix O and Appendix P). The table on the next page summarizes the development prototypes BAE analyzed for the SOFA Phase II area. Appendix S provides a more detailed description of the type of construction and unit amenities assumed for each development prototype. Sacramento Region Office 740 G Street Davis, CA 956516 Headquarters 530.750.2195 539.750.2194fax bayareaeconomics.com 510.549.7310 Development Prototypes by Zoning and Parking Alternative Development.Prototype i ~’ i~" ~:Construcfion.Type Existing Zoning, 0.6 FAR 1.15 FAR Standard Parking 1.15 FAR Reduced Parking 1.5 FAR Standard Parking 1.5 FAR Reduced. Parking 2.5 FAR Standard Parking 2.5 FAR Reduced Parking Existing Zoning 0.6 FAR 1.15 FAR Standard Parking 1.15 FAR Reduced Parking 1.5 FAR Standard Parking 1.5 FAR Reduced Parking Wood Frame, 2-Story Apartrnents/Commereial Wood Frame, 3-Story Condos Wood Frame, 3-Story Condos Wood Frame, 3-Story Condos Wood Frame, 3-Story Condos Wood Frame, 3-Story Condos Wood Frame, 3-Story Condos Wood Frame, 2oStory Apartments/Commercial Wood Frame, 3-Story Condos/Commercial Wood Frame, 3-Story Condos/Commercial Wood Frame, 3-Story Condos/Commercial Wood Frame, 3-Story Condos/Commercial 6,300 10,500 10,500 15,000 15,000 22,000 22,000 14,975 29,200 29,200 29,200 39,300 ..ReSidentiaLUnits ~i~3 bed’2bath: 2 @ 1,400 Sq.Ft. each 7 @ 1,500 Sq.Ft. each 7 @ 1,500 Sq.Ft. each 10@1,500 Sq.Ft. each 10@1,500 Sq.Ft. each 10@1,500 Sq.Ft. each 15@1,500 Sq.Ft. each 7 @ 1,425 Sq.Ft. each 16 @ 1,500 S.F. each 16 @ 1,500 S.F. each 16 @ 1,500 S.F. each 22 @~1,500 S.F. each :Commercial ~ ’ : Parking: 3,500 Office 18 Surface 17 Podium 11 Podium 23Podium 15Podium 33 Undrgmd 21.Undrgmd. 5,000 Office 36 Surface q 2,500 Office 4 Surface 2,700 Retail 15 Tuck Undr. 39 Podium 2,500 Office 4 Surface. 2,700 Retail 15 Tuck Undr. 24 Podium 2,500 Office 4 Surface 2,700 Retail 15 Tuck Undr. 39 Podium 2,500 Office 4 Surface 2,700 Retail 15 Tuck Undr. 2.5 FAR Standard Parking 2.5 FAR Reduced Parking Wood Frame, 3-Story Condos/Commercial Wood Frame-Steel Joists, 4-Story Condos/Commercial 38,500 53,300 20 @1,500 S.F. each 33 @~1,400 S.F. each 4,000 Office 3,000 Retail 2,800 Office 2,750 Retail 33 Podium 29Undrgmd. 24Podium 19 Surface 24 Undrgmd. 26 Podium 19 Surface Sacramento Region Office 740 G Street Davis, CA 956516 Headquarters 530.750.2195 539.750.2194~x bayareaeconomics.com 510.549.7310 4 Current SOFA Area Real Estate Market Conditions BAE conducted a survey of currently leasing/for sale residential, retail, and office properties in the vicinity of SOFA. BAE surveyed approximately 60 properties. The results of the survey are shown in Appendices A, B, C, and D. BAE also reviewed recent property transactions for vacant land and condominium sales within Palo Alto. Based on these surveys, BAE has utilized the rental rate/sales price assumptions shown in the following matrix, summaries of which are provided below. For-Sale Condominiums BAE located 18 condominiums for sale within the vicinity of SOFA. The properties varied in price and size but averaged $534 per square foot. Excluding an adult living unit (persons 55 years and above) with an available pool and spa and asking pdee of $811 per square foot, the average asking sales price was $517 per square foot: BAE also reviewed condominium sales withinthe downtown zip code (94301) over the last 12 months. BAE located 30 condominitun sales that averaged approximately $460 per square foot with an average building age of 30 years. Based on these eomparables, a conservative estimate for a new condominium project with reduced parking (1.5 per unit) is $500 per square foot, while a new condominium project with standard parking (2.3 per unit) could conservatively obtain $515 per square foot in the SOFA Phase II area. Rental Residential BAE obtained rental information for 13 properties within vicinity of SOFA. Rental rates varied from a low of $1.43 per square foot to a high of $2.78 per square foot. Overall, the average per square foot rental rate was $1.81. BAE also reviewed RealFacts data, which maintains multifamily housing summary information on 13 projects in Palo Alto. In March 2002, three bedroom-two bath units within the 13 projects averaged $1.88 per square foot. New three bedroom-two bathroom rental units would likely generate more than the average per square foot rental rate, but the actual rental rate would clearly be contingent upon unit and building amenities. Office, BAE obtained leasing information on 23 office properties within the vicinity of SOFA. In total, BAE found approximately 115,000 square feet of vacant office space within the area with a median lease rate of $3.75 per square foot, triple net (NNN). The spaces varied in size and type, with vacant Class A office space asking from $2.00 to $4.50 per square foot, NNN. Based on the comparables, a new office space of the type envisioned in the development prototypes could conservatively generate approximately $3.50 per square foot, NNN. Retail BAE located three properties with available retail space within the vicinity of SOFA. The three spaces averaged approximately $4.00 per square foot with lease terms negotiable. BAE also contacted commercial brokers that work within SOFA to further understand the retail demand within SOFA. All of the brokers indicated there is a lack of parking within SOFA which Sacramento Region Office 530.750.2195 740 G Street 539.750.2194 fax Davis, CA 956516 bayareaeconomics.com Headquarters 51,0.549.7310 reduces retail opportunities. Brokers stated that SOFA will continue to struggle ,to compete with better parked and heavier auto and pedestrian traffic retail areas in downtown and elsewhere, in Palo Alto. In addition, two commercial brokers felt that downtown employee parking spilled over into SOFA further reducing the number of. available parking spaces for SOFA retailers. The City recently estimated a downtown parking shortfall of approximately 1,450 spaces. The City is currently constructing another 700 public parking spaces in. the downtown, which will help to alleviate parking press~es in downtown and in surrounding ~ including SOFA. Pro-Forrna Analysis The pro-forma analyses synthesize local market data, construction cost information, and operating expenses to estimate land residual values for each development prototype. The land residual value is based on stabilized project occupancy, or -in the case of condominiums- project sell-out. It is important to note that construction costs, operating expenses, and revenue potential can change in response to economic cycles and other macro and microeeonomic conditions; however, BAE has based this analysis on existing conditions. Development Cost Assumptions Appendix S provides a detail of development costs by prototype. These costs are a synthesis of information from building contractors, developers, and BAE’s review of the 2002 P,S Means. Square Foot Cost manual.’ In general, BAE used conservative construction cost estimates and assumed high-quality construction and ample unit amenities. Parking costs are represented on a per square foot basis and were obtained through conversations with developers and contractors that work within the Palo Alto region. Underground parking represents the most expensive parking type, priced at $75 per square foot. Underground parking on smaller parcels (e.g. a small 10,500 square foot lot) becomes quite expensive due to a lack of parking efficiencies (e.g., a major portion of the underground parking area is dedicated to the ramp). BAE estimated the cost of building underground parking on the small site at over $35,000 per space. ~ RS Means, Square Foot Costs 23rd Addition, 2002. The KS Means manual provides national construction cost data for a broad range ofdevelopment types. The RS Means manual includes construction cost multipliers for Palo Alto. Sacramento Region Office 530.750.2195 740 G Street 539.750.2194 fax Davis, CA 956516 bayareaeconomics.com Headquarters 510.549.7310 The following table summarizes the construction cost assumptions by land use and site size: Mixed-Use Apartments / Commercial Condominiums Mixed-Use Condominiums/ Commercial Construction.Costs/ :~ Parl~ng Costs/., Apartments: $141 Commercial: $156 Small Project: $160 Larger Project: $150 Condominiums: $140-$150 Commercial: $150- $160 Surface: $8 Surface: $8 Podium: $45 Underground.: $70-$75 Surfade: $8 Tuck:Under: $30 Podium: $45 Underground: $70 $20/Bldg. Sq. Ft. $17,000 - $18,000/urdt exeld. BMR costs $13-$26/ Bldg. Sq. Ft. excld. BMR costs ¯ Construction, ¯ FinanCing Terms Rate 7.5% LTV 0.75 Points: 1.5% Drawdown: 0.55 Rate 7.5% LTV 0.75 Points: 1.5% Drawdown: 0.55-0.60 Rate 7.5% LTV 0.75 Points: 1.5%-2.0% Drawdown: 0.55-0.65 Developer Profit. BAE contacted a number of local lenders to obtain construction lending criteria within Palo Alto. Overall, BAE found that lenders look favorably upon projects within the City of Palo Alto and assign lower underwriting criteria compared to the Bay Area overall. Capitalization rates are generally lower in Palo Alto than in neighboring cities. Nonetheless, lenders stated that commercial projects in general, and office projects specifically, are deemed to involve more risk than residential projects in today’s economic climate. To offset the higher risk, lenders require higher developer profit margins. In this analysis, BAE assumed a strictly residential project would require a 10 percent return on total costs minus financing costs, while a mixed-use project would require a 12 percent return on total costs minus financing costs. Defect Liability Insurance for Ownership Residential Projects. BAE contacted local insurers to obtain cost information on wrap insurance policies that protect developers and their contractors from construction defect claims (particularly for condominium construction). While BAE located two insurance brokers that provided insurance cost estimates, both brokers indicated that the short-term future of wrap insurance policies is uncertain. The brokers stated that the stagnant stock market combined with September 11, 2001 severely damaged the insurance industry. Compounding the problem is the prevalence of construction defect claims within California on condominium projects. As a result, insurers have been more hesitant to offer higher risk insurance policies, including wrap insurance policies. Currently, wrap insurance policies are estimated at $420,000 for coverage capped at a maximum of $3,000,000 without the ability to augment the amount of coverage. Insurance brokers and developers stated that wrap insurance policies may disappear altogether. The result would be a near standstill in condominium construction throughout California, including Palo Alto. Developer ~ Profit 12% 10% 12% Sacramento Region Office 740 G Street Davis, CA 956516 Headquarters 530.750.2195 539.750.2194 ~x bayareaeconomics.com 510.549.7310 BAE’s analysis assumes a developer would be able to obtain defect liability insurance. If this insurance were not available, redevelopment feasibility would be reduced because multifamily rental units do not generate similar values compared to condominium values. As an example, a 1,500 square foot rental unit in SOFA would generate approximately $22,000 in. net revenue a year. Based on local capitalization rates, the apartment could sell for approximately $318,000.3 A comparable condominium with similar unit amenities could sell in Pale Alto for approximately $750,000, which is more than twice the value of the rental unit. Operating Costs Assumptions BAE calculated operating expenses for retail and office space assuming a triple net lease arrangement, under which the property owner passes most of the property operating expenses on to tenants. The property owner’s assumed monthly management and property maintenance expense rate is $0.35 per office square foot and $0.33 per square foot for retail. The estimated apartment operating expense rate is 30 percent of gross potential rent for the small two unit apartments presented in Appendix E, due to a lack of economies of scale, and 25 percent of’ gross potential rent for the seven unit mixed-use project presented in Appendix L.4 After reviewing existing market lease rates within SOFA, BAE developed revenue assumptions for office, retail, apartment, and condomimum uses.. The following matrix provides a summary of the revenue and operating expense assumptions: Land Use Description Office Retail Very small scale multifamily project (2-unit project) Small scale project (7-unit project) Condominium - Standard Parking Condomimum - Reduced Parking mixed use multi family mixed use Monthly Lease Rate/Sq. Ft. $3.50 $3.25 $1.90 $.1.95 $515 (sales price) $500 (salesprice) Operating Expenses/Sq.Ft. $0.35/Month $0.33/Month 30% of Gross Rent 25% of Gross Rent Not applicable Not applicable Assumed Vacancy 10% 10% 5% 5% 5% Marketing and Brokerage Fee 5% Marketing and Brokerage Fee Capitalization Rate 8% 8% 8% 8% Not applicable Not applicable Assumes a three bedroom-two bath unit could garner $2,850 per month with an annual expense rate of 30 percent of gross potential revenue. Assumes a capitalization rote of 7.0 percent.4 Dollars and Cents of Multifamily Housing, National Apartment Association, Urban Land Institute, 2000. Local multifamily housing developers, 2002; U.S. Bank, 2002; Mid-Peninsula Bank, 2002. Sacramento Region Office 530.750.2195 740 G Street 539.750.2194 fax Davis, CA 956516 bayareaeconomics.com Headquarters 510.549.7310 Redevelopment Incentive Thresholds As part of the economic feasibility analysis, BAE evaluated the financial returns that would encourage landowners to redevelop his or her parcels. Specifically, BAE analyzed the existing economic value of the small site with 9,800 square building auto-related service and added demolition costs and redevelopment profit to estimate the price that a developer would need to be able to pay the property in order to make it financially attractive for the owner to sell the property rather than continue with the current economic use of the property. The analysis assumes that the small site owner will continue to operate its building as is without renovating or redeveloping me site if its existing economic value exceeds what a developer could afford to pay in order to acquire the site for a given development prototype. BAE determined the building’s economic value by assuming the building is leased to a separate auto repair business in its current condition. As shown ia, Table 1, at an assumed lease rate of $1.85 per square foot (NNN), a monthly management expense of $0.19 per square foot, vacancy of 10 percent, and a capitalization rate. of eight percent, the 9,800 square foot auto service building has an economic or capitalized value of $2,175,600. ~BAE then added $10 per building square foot demolition costs and 10 percent redeveloprqe~rofit resulting in a land residual goal of $2,491,160 or $237 per lot square foot. This is ~°e~timated financial incentive necessary to redevelop the small site. ; , BAE also analysed the necessary financial ~neentiVe to make it worthwhile for the City of Palo Alto to augment or upgrade an existing electric substations that could replac~ the electric capacity currently PrOvided by the City’s substation at 841 Alma. According to the City’s Utilities Dep~krtment, a~[ough~~stimate ~f replacement costs is one million dollars. Adding. redevelopment profit of 10 percent results in a land residual goal of $1.1 million or approximately $70 per lot square foot. Therefore, the combined land residual value goal is $1.1 million plus $2.49 million results in a combined site land residual value goal of approximately $3.59 million. While the economic value for the substation is substantially lower than small site’s economic value on a per lot square foot basis, the substation site’s land residual value as a vacant property would be approximately $53 per square foot based on existing zoning standards.~ The small site is assumed to contain an~ existing building -on the other hand- that exceeds existing zoning standards and does not require new construction to generate economic value. ~ Based on a floor area ratio of 0.6 with a maximum office square footage of 5,000 square feet. Assumes 5,000 square feet of office with four 1,100 square foot rental units. Sacramento Region Office 530.750.2195 740 G Street 539.750.2194 fax Davis, CA 956516 bayareaeconomics.com Headquarters 510.549.7310 Table 1: Economic Value and Redevelopment Feasibilit~ Thresholds Small Site - Auto-Related Service Lot Size .10,500Auto-Related Service Building Size 9,800Estimated Lease Rate As Is (NNN)$1.85Monthly Lease Revenue $18,130Less Vacancy (-10%)($1,813)Estimated Expense Rate ($0.19)~Monthly Expenses ($1,813)Total Monthly Revenue $14,504 Lot Sq. Ft, Bldg, Sq. Ft. /Bldg. Sq.Ft. /Month /Month /Bldg. Sq.Ft. /Month Annual Revenue $174,048 /YearC.. aapitalizat~on Rate 8%Building Capitalized Value $2,175,600 Total Site Value $2,175,600Demolition Costs $98,000 @$10/Bldg. Sq. FL R=.R_edevelopment Profit 10% of Site ValueTotal Land Residual Goal $2,491,160Total Land Residual Goal/Sq Ft.$237.25 /Lot Sq.Ft. 841 Alma, Cit~ Utilit7 Substation "Lot Size Estimated cost to remove substation and upgrade other to maintain capacity Total Site Value Redevelopment Profit Total Land Residual Goal Total Land Residual Goal/Sq Ft. 15,750 Lot Sq. Ft. $1,000,000 $1,000,000 10% of Site Valun $1,100,000 $69.84 /Lot Sq.Ft.. jSmall Site Land Residual Goal Total Land Residual Goal/Sq Ft.$2,491,160 $237.25 $3,591,160 $136.81ICombined Site Land Residual Goal Total Land Residual Goal/Sq FL /Lot Sq.Ft. I /Lot Sq.Ft.1 Sources: City of Palo Alto, Planning and Community Environment Department, 2002; BAE, 2002, Development Feasibility Results BAE compared the land residual values for each development prototypes to the economic or capitalized value of the small site and the small site and the City substation’s combined large site discussed in the previous section. These results are summarized on the next page. Overall, the reduced parking hltemative adds to the efficiency of the site but only provides marginally higher returns where a site can physically accommodate the higher parking requirements without reducing the building intensity. Existing zoning standards do not provide sufficient economic incentive to landowners to redevelop their property. Owners of smaller parcels have more barriers towards redevelopment than larger sites because the larger sites offer better economies of scale and improved site parking effieiencies. Redevelopment potential for sites that do not have sufficient size to build underground or partially submerged podium parking would be severely limited under the standard parking requirements. In addition, a City policy that restricted parcel consolidation would reduce redevelopment feasibility due to a loss of economies of scale and reduction in site effieieneies. Small Site Redevelopment Opportunities Ex.isting market conditions would not provide sufficient incentive to redevelop a small site (approximately 12,000 square feet or less) under a 1.15 FAR alternative. Based on BAE’s economic analysis, the 1.5 FAR alternative would provide sufficient incentive to redevelop the small site with a marginal increase of one percent to the project value. While a 1.5 FAR parking alternative provides redevelopment incentive for smaller sites, redevelopment would likely result in condominium projects and not mixed-use projects because of the higher parking requirements for office and retail uses. Due to the marginal feasibility of the small site, a 1.5 FAR zoning alternative may have difficulty providing a local public benefit (e.g. open space, available public parking, etc.), which would be necessary to apply for the 1.5 FAR without eliminating the site’s economic feasibility. The 2.5 FAR low parking requirement, would generate the highest land residual value at $3.1 million. Using the land residual goal model discussed earlier, BAE can give a rough estimate of development feasibility for small redevelopment projects in general. If BAE assumed a similar sized parcel with an 8,000 square foot building averaging $2.00 per square foot (NNN) a month, the 1.5 FAR alternative with standard parking would provide sufficient incentive for site redevelopment. Simultaneously, if BAE assumed a 9,000 square foot building on the same parcel and $2.50 per square foot lease rate redevelopment would only be economically feasible under a 2.5 FAR reduced parking alternative. Large Site Redevelopment Opportunities Due in part to the lower economic value of the substation and greater site efficiencies, the 1.15 FAR standard parking alternative would provide sufficient financial incentive for redevelopment. Similar to the small site, the standard parking alternatives for the 1.5 and 2.5 FAR alternatives would curtail the total building square feet regardless of the FAR limitations. If BAE applied the FAR alternatives to a similar sized undemtilized parcel (26,250 lot square feet), containing a 15,000 square foot building that generated $2.00 per square foot in revenue, a 1.15 FAR standard parking would offer sufficient incentive to the property to redevelop his or Sacramento Region Office 740 G Street Davis, CA 956516 Headquarters 530.750.2195 539.750.2194fax bayareaeconomics.com 510.549.7310 11 her property, If the same building leased at $3.00 per square foot, a 1.5 FAR reduced parking alternative would provide sufficient economic incentive. Economic Feasibilit3, Analysis Summar~L Existing Zoning 0.6 FAR 1.15 FAR Standard Parking 1.15 FAR Reduced Parking 1.5 FAR Standard Parking 1.5 FAR Reduced Parking 2.5 FAR Standard Parking 2.5 FAR Reduced Parking Existing Zoning 0.6 FAR 1.15 FAR Standard Parking 1.15 FAR Reduced Parking 1.5 FAR Standard Parking 1.5 FAR Reduced Parking 2.5 FAR Standard Parking 2.5 FAR Reduced Parking $1,537,000 $3,757,000 $3,599,000 $4,392,000 $4,192,000 $7,078,000 $6,396,000 $3,208,000 $8,426,000 $8,109,000 $8,426,000 $9,954,000 $10,791,000 $14,075,000 $1,989,000 $5,137,000 $4,988,000 $6,838,000 $6,646,000 $9,773,00O $9,496,00O $4,!42,000 $13,344,000 $13,023,000 $13,344,000 $16,819,000 $16,528,000 $22,898,000 $452,000 $1,380,000 $1,388,000 $2,446,000 $2,454,000 $2,696,000 $3,099,000 $934,000 $4,918,000 $4,914,000 $4,918,000 $6,864,000 $5,737,000 $8,823,000 Not feasible Not feasible Not feasible, needs ~25% increase, in gross revenue Feasible with ~1% increase in gross revenue Feasible with ~1% increase in gross revenue Feasible Feasible, could absorb some reduction in condo values or increased costs Not feasible Feasible, and feasible with substation priced at $155/Lot Sq.Ft. Feasible, and feasible with substation priced at $155/Lot Sq.Ft. Feasible, and feasible with substation priced at $155iLot Sq.Ft.. Feasible, and feasible with substation priced at $280/Lot Sq. Ft. Feasible, and feasible with substation priced at $205/Lot Sq. Ft. Feasible, and feasible with substation priced at $400/Lot Sq. Ft. Sacramento Region Office 740 G Street Davis, CA 956516 Headquarters 530.750.2195 539.750.2194 fax bayareaeconomics.com 510.549.7310 12 Ground Floor Office Restrictions As part of the economic analysis, BAE reviewed retail market conditions within SOFA Phase II. BA~ did not estimate the gross annual demand for retail space within the area or forecast future retail demand within SOFA. Rather, BAE reviewed existing work performed by Wallace and Stiechen, Inc. in June, 2001 and contacted local retailers, developers, and brokers within SOFA to gather qualitative information on the overall retail demand within SOFA, as a substitute for office uses. Further analysis on available parking, the total potential retail space in SOFA, and an .analysis of retail demand within walking distance of SOFA would provide a more comprehensive understanding of retail market conditions within SOFA and the potential economic impact of curtailing office uses on the ground floor. SOFA - West Retail Market Study The South of Forest Area - West, Retail Market Study (Wallace & Steichen, Inc., June 2001) was limited to a general overview of existing retail conditions and to analyzing demand for grocery store space in SOFA Phase II. The study does not attempt to estimate the total supportable retail space in the area nor analyze other retail store categories on their economic viability in the SOFA Phase II area. According to the SOFA Retail Market Study, the SOFA Phase II area has 62,000 square feet of retail space, with more than 50 percent of the space dedicated to grocery and eating and drinking establishments. These establishments are scattered throughout the SOFA Phase II area with slightly greater concentrations of retail space on Homer Avenue and Emerson Street. The SOFA Retail Market Study assumed households within the 94301 zip code to be the primary trade area. According to their retail market study, the primary trade area has 7,609 households containing 16,510 residents. These households tend be more affluent and have lower household sizes than Palo Alto households in general, with an estimated per capita income of approximately $82,000 in 2000 and an average household size of 2.1 persons per household. The SOFA Retail Market Study estimated the amount of supportable retail square feet for grocery retail within SOFA. The analysis shows SOFA’s total supportable grocery demand at 44,000 square feet.’ After accounting for the 22,000 square foot Whole Foods store at Homer Avenue and Emerson Street, the report estimates SOFA could support another 22,000 in grocery retail space. The SOFA Retail Market Study did not provide a supportable square foot estimate for other retail categories, but rather, provided a rough estimate that another 30,000 to 100,000 square feet of retail could be supported in SOFA within a ten-year period. If the SOFA Phase II area could only attain the lower estimate of 30,000 square feet, a new commercial building or buildings with existing retail tenants could be financially impacted by a zoning ordinance that curtailed office use on the ground floor. 6 The SOFA Retail Market Study estimate a total sales potential for grocery expenditures of $35,120,000 and assumes $800 per square foot. Sacramento Region Office 530.750.2195 740 G Street 539.750.2194 fax Davis, CA 956516 bayareaeconomics.com Headquarters 510.549.7310 13 Due to scope constraints, BAE did not obtain the total existing and potential commercial square footage within the SOFA Phase II area. Nonetheless, assuming a 30,000 square foot retail square foot absorption over ten years and limiting office uses on the ground floor for new and existing retail buildings would likely result in higher eornmereial space vacancies, especially in areas that do not have retail synergies and lack walk-by traffic. Based on .the higher 100,000 square feet retail absorption estimate, new and existing retail space could expect healthier real estate conditions but still may be impacted if newly redeveloped parcels added more than 100,000 retail square feet in addition to the estimated 62,000 retail square feet already within the SOFA Phase II area. Retail Absorption Under the Working Group and the Staff Alternative, only new commercial space within specified area of SOFA Phase II area and buildings that already contain retail tenants in specified areas would be affected by the ground floor limits on office uses. Existing ground floor office buildings are grandfathered in and could continue to lease to office tenants. If the office tenant vacated the space, the landowner would have a year to baeldill the space with another office tenant as long as he or she did not expand the total square footage of the building. Therefore, the area shou!d not experience a sudden injection of available retail space but rather, will likely result in an incremental increase in the amount of retail square feet as sites are sporadically redeveloped. Existing Office Market Conditions The regional office market is currently recovering from a considerable increase in office vacancies and subsequent decline in market lease rates as a result of the slowdown of high teeh and venture capital employment and a recent injection of office space. According to CB Richard Ellis 2002 1st Quarter Report, Palo Alto’s office market had an overall vacancy rate of 18 percent and lost approximately 34,000 square feet in the total occupied office tenant space from the previous quarter. The report also estimated another 167,000 square feet was under construction. While Palo Alto has been affected less than many other jurisdictions, it has seen a rise in office vacancies. Compounding the increase in office vacancies is new office developments under construction at Whiskey Gulch in East Palo Alto, showing a short-term risk in developing office space of any considerable size. Lenders indicated a general hesitation to underwrite large office projects. While this creates some impact to small office developers, they do not compete at the same level as large scale office projects which are more affected by regional economic downtums. Nonetheless, the Overall office market in Palo Alto is soft and do not justify large scale new.specu!ative construction in the short term. On the other side, retail real estate market conditions have remained relatively healthy. BAE found only three buildings within the vicinity of the SOFA Phase II area that had available retail space for lease. In general, those spaces were asking comparable lease rates to available office spaces. BAE did not locate any subregional retail market reports that spoke to retail real estate conditions ha the Palo Alto area. Sacramento Region Office 740 G Street Davis, CA 956516 Headquarters 530.750.2195 539.750.2194 fax bayareaeconomics.com 510.549.7310 14 Developing Retail Synergy Certain areas within the SOFA Phase II may be better suited for retail. The intersection of Emerson andHomer Avenue contain higher concentrations of retail uses compared to the SOFA Phase II area overall. The Retail Market Study states that, "small retailers cannot survive unless they are located close to other retailers that supply similar or complimentary goods and services.’" Targeting specific retail nodes within SOFA Phase II for retailers while allowing office users elsewhere may encourage the concentration retail uses and improve local retail synergy. This assumes that a commercial building can obtain a higher premium for office use than for a retailer. In this scenario, office users would locate along streets that allowed for large office space thereby pushing retailers towards specific locations within the SOFA Phase II area. Currently, office and retail lease rates are comparable and a commercial building owner would not fred sufficient financial incentive to target office tenants over retail tenants. Notwithstanding, certain streets within the SOFA Phase II area are not conducive to retail uses. For example, Alma Street is a heavy auto traffic corridor that does not have on street parking. This area would not be conducive to retail uses. Commercial Space Flexibility and Absorption Limiting commercial landowner flexibility is likely to be the largest economic impact as a result of curtailing office uses within the SOFA Phase II area. A landowner with vacant retail space would only be able to target retail tenants rather than allowing either a retailer or an office user to inhabit the space. This may result in longer vacancies and -if the space remained vacant long enough- a reduction in the asking lease rates as the landowner weighs the loss in potential revenue over a vacant property generating zero revenue. Simultaneously, owners of ground floor office spaces may be hesitant to lease space to a prospective retailer because -under the proposed ordinance- the landowner would be unable to convert it back to office space. Under existing conditions, retail remains relatively healthy in Palo Alto overall compared to a recovering office market. However, fluctuations in real estate market conditions that increase demand for office and reduced demand for retail can and do occur. The result would be a loss in potential revenue as commercial landowners would be precluded from leasing the space to a higher income generating use. Parking The SOFA Retail Market Study points out that, "...successful convenience retailing requires convenient, easily accessible parking."’ BAE did not obtain an inventory of parking within the SOFA Phase II area but did receive qualitative information from brokers, developers, and landowners who stated that there is a shortage of parking within the area. As discussed earlier, they argued that they the SOFA Phase II area retailers would have to compete with downtown retailers, which are part of a parking district. While new development would likely cover its share of parking demand under the Specific Plan’s parking requirements of four spaces per 1,000 building square feet, an existing parking shortfall within SOFA could reduce the Wallace, John; Retail Market Study South of Forest Area - West, City of Palo Alto, June, 2001, page 17. Ibid, page 18. Sacramento Region Office 530.750.2195 740 G Street 539.750.2194 fax Davis, CA 956516 bayareaeconomics.com Headquarters 510.549.7310 15 economic viability of retail in the area. As discussed earlier, the City of Palo Alto is attempting to alleviate the existing parking shortfall in the downtown by building 700 additional public parking spaces. This will help to alleviate parking pressures placed on adjacent communities, including the SOFA Phase 1I area. Conclusions Curtailing ground floor office .uses within the SOFA Phase II area altogether may deter redevelopment projects that create mixed-use products. Properties not within close proximity to other retail services that could not create retail synergies are likely to struggle to maintain a retail tenant at comparable office lease rates. The result would be a greater emphasis on residential projects compared to building both retail and residential mixed use. Furthermore, if parking availability is exceedingly constrained within the area, developers may have difficulty competing with nearby downtown retail space, which are a part of a parking district. Notwithstanding, current retail market conditions are relatively healthy and would likely support new retail. A possible alternative could be to limit ground floor office uses along specific retail nodes and allow ground floor of-flee in areas that are less conducive to retail. ¯ Based on existing retail conditions, logical retail loeati0ns appear to be Homer Avenue and Emerson Street. Corridors less conducive to retail include Alma Street and Ramona Streets. Sacramento Region Office ’ 530.750.2195 740 G Street 539.750.2194 fax Davis, CA 956516 bayareaeconomics.corn Headquarters 510.549.7310 16 o o ,- 0 0 0 0 0 0 0 0 0o888°o 8 8 8 ° o o =,. 0 0 0 0 0 0 0 0 0 0 0,.,~.8 8 8 8 o zzzz (D z z ¯~z ~o zzz 0 0 0 0 0n~ 0 0 z z zzz zz zz z z (:3 ®.~ o o m o 0 0 0 ¯ Appendix E: Small Site, Existin Zo~ Regulations (0.6 FAR) Developreent Pro~rem Number Unit Parkln~l Required SpsceeLot Size 10,500 Sq. FL Retail Perking 1 Sid250 Sq. FLCommercial Space 3,500 Bldg. Sq. FL Office Perking 1 Sp/250 Sq, FLRetail Square Feet Residential Parldng 2 Sp/UnitOffice Square Feet 3,500 Bldg. Sq, FL Total Rental Units 2 Units@l,400 Sq. FL Each Pa~kln~ T~e SpacesResidential Square Feet 2,500 Sq. FL Surface ParkingTotal Building Square Feet 6,300 Sq. FL Podium Parking Underground Paddng 14 4 19 HARD COSTS Item Number Unlt Price Unit Itare CostsSite Area Improvements 10,500 Sq. FL $6 ISq. Ft.$63,000Commercial Censt~JcUon (a)3,500 Bldg, Sq. FL $156 /Bldg, Sq,FL $546,000Roaidenttal Building (b)2,800 Bldg. Sq, FL $142 /Bldg. Sq.Ft.$396,872~Surface Parkln~l (c)6,000 Sq. FL $8 !Sq. Ft,$48 000TOTAL6,300 Bldg, Sq. FL $1,053,872 SOFT COSTS Item Number Amhimcture Fees $1,053,872Eagineedng Fees $1,053,872I.,,J~~t Fees and Buildine Fa~s Development Impact Fees Commendel 3,500Reeidential2Building Fees Plumbing, Mechanical, and Electric 6,300Building Fees $1,053,872 School Fees Commendal Residential Plan Check Fees (d) UBity Fees (d) i an’ ¯ Loan to Value Ratio Length of ConstnJction Pedod Drawdown Factor Consb’uction Loan Rate Loan Fees Permanent Loan Fees Proiect Contin~lenc,/ TOTAL SOFT COSTS Unit Price Unit Itere Costs Total Hard Costa 5% of Total Hard Costs $52,694Total Hard Costs . 2.5% of Total Hard Costs $26,347 Bldg. Sq, FL S18,75 /Bldg. Sq.FL $65,625Unltr~l,400 Sq. Ft. Ea S6,930 /Unit $13,860 Bldg. Sq, FL $0.18 /Bldg. Sq.FL $1,134Total Hard Costs $5,892 * $3.85/additJonel $1,000 ~6,105 3,500 Bldg. Sq. Ft,$0.34 /Bldg. Sq.Ft,S1,1902,800 Living Area S2.14 /81dg. Sq. Ft, of Living Area $5,9921 Project $14,539 /Project $14,5391 Project $20,800 /Project $20,800 $1,262,158 Total Value 0.75 of Total Value 8 mo~ths $946,618 TotalLeen 0.55 of TotalLoan"$946,618 Total Loan 7.5% of Total Loan/Year $26,032S946,618 Total Loan 1.5% of Total Loan $14,199$976,792 Permanent Loan 1% of Permanent Loan $9,768$1,312,157 Nard & Soft Costs 5% of Hard & Soft costs $65,608 $323,893 DEVELOPER PROFIT $1,327,766 Hard & Soft Costs (e)12% of Hard & Soft cests (e) $159,332 TOTAL CONSTRUCTION COSTS:. i.;$i,537 00~ REVENUE ................... ............... REVENUES end EXPENSES Number Unit Price Per Unit TotalOFFICE LEASING Monthly Lease Rate (NNN)3,500 Bldg. Sq. FL $3.50 ISq. Ft.$12,250Less Vacancy 10% of Potant~l Revenue ($1,225)Monthly Operating Expenses 3,500 Bldg. Sq. Ft.($0.35) ISq, Ft.($1,225)RESIDENTIAL LEASING Monthly Leese Rata 2,800 Bldg. Sq, FL $1,90 /Sq,~=t.$5,320 1750Less Vacancy 5% of Potential Revenue ($266)21000Monthly/Operatinc~l Expenses 30% of Potential Revenue _IS1,5961 300000TOTAL MONTHLY REVENUE 6,300 Bldg. Sq. Ft,$2.10 /Bq. Ft.$13,258 NET ANNUAL REVENUE:;.. $159,096 LAND RESIDUAL VALUE Capitalized Value Estireats Net Annual Revenue $159~096Capitalization Rate 8,0%Total Capitalized Value $1,988,700Minus Total Development Costs $1,537,097LAND RESIDUAL VALUE $43.01 /Lot. Sq. Ft,~ Notes; (a) Assumes wood frame construction with tenant improvements included at $40 per square foot, See Appendix S for a full building detail, (b) Assumes 1,400 square foot units with wood frame construction, custom quality construction, skylighL and full appliances. (c) For surface parking assumes 333 square feet a space with landscaping. (d) See Appendix T for a detail list of planning, building, and development impact fees. (e) Financing costs are not included in calculating developer profit, (f) The estimated monthly unit expanse rate is $4,000 per year due to a lack of economies of scale. Soumes: RS Mean Square Foot Construction Costs, 2002; Ross Construction, 2002; Seque Construction; 2002; J.R, Roberts Construction, 2002; Classic Communities, 2002; Dollars and Cents, Multifamily Housing, 2002; BAE, 2002. =Appendix F: Small Site~ 1.=~15 FAR Alternative=Standard Parkin9 Development Program Lot Size Commercial Space Retail Square Feet Office Square Feet Total Condominiums Residential Square Feet Total Building Square Feet Number Unit 10,500 Sq. FL Bldg. Sq. Ft. Bldg. Sq. Ft. Bldg. Sq. Ft. 7 Units@l,500 Sq. Ft. Each 10,500 BId~l. Sq. Ft. 10,500 Bldg. Sq. Ft. Parking Required Retail Parking 1 Sp/250 Sq. Ft. Office Parking 1 Sp/25OSq. Ft. Residential Parking 2.3 Sp/Unit Spaces 17 ~Type ~Surface ParkingPartially Submerged Podium Parking 17 Underground Parking HARD COSTS Item Number Unit Cost Unit Item Costs Price/UnitSite Area Improvements 10,500 Sq. Ft.$6 ISq. Ft.$63,000 $9,000Residential Building (a)10,500 Bldg. Sq. Ft.$160 /Bldg. Sq. Ft.$1,680,315 $240,045Podium Parking (b)7,200 Sq. Ft..$45 ISq. Ft.$324,000 $46,286TOTAL10,500 Bldg. Sq. Ft.$2,067,315 $295,331 SOFT COSTS Item Number Architecture Fees $2,067,315 Engineering Fees $2,067,315 ¯ Defect Uability Wrap Insurance 1 Video Recording of Construction 1 . Development Impact Fees and Buildinq Fees Unit Cost Unit Item Costs Price/Unit Total Hard Costs 5% of Total Hard Costa $103,366 $14,767Total Hard Costs 2.5% of Total Hard Costs $51,683 $7,383Project$420,000 $3 Million in Coverage $420,000 $60,000Project$50,000 /Project $50,000 $7,143 Development Impact Fees 7 Units $6,930 /UnitBMR Residential In-Lieu Fee $5,407,500 Appraised Apt Value 5% *Appraised Apartment ValueBuilding Fees Plumbing, Mechanical, and Electric 10,500 Bldg. Sq. Ft.$0.18 /Bldg. Sq. Ft.. Building Fees $2,067,315 Total Hard Costs $5,892 + $3.85/additional $1,000Excavation Fees 9,600 Cubic Yards $1,000 + $100/additional 1,000 C.Y.School Fees 10,500 Living Area $2.14 Bldg. Sq. Ft. of Living AreaPlan Check Fees 1 Project $21,260 /Project Utility Fees 1 Project $25,300 /Project _.Construction Financinq Costs Loan to Value Ratio $3,094,179 Total Value 0.75 of Total ValueLength of Construction Period 16 months Drawdown Factor $2,320,634 Total Loan 0.60 of Total LoanConstruction Loan Rate $2,320,634 Total Loan 7.5% of Total Loan/Year Loan Fees $2,320,634 Total Loan 1.5% of Total Loan Proiect Contingency $3,268,226 Hard & Soft Costs 5% of Hard & Soft Costs TOTAL SOFT COSTS $48,510 $6,930 $270,375 $38,625 $1,890 $270 $10,111 $1,444 $1,900~$271 $22,470 $3,210 $21,260 $3,037 $25,300 $3,614 $139,238 $19,891 $34,810 $4,973 $163,411 $23,344 $1,364,323 $194,903 DEVELOPER PROFIT $3,257,590 Hard & Soft Costs (d)10% of Hard & Soft Costs (d)$325,759 $46,537 REVENUE REVENUES and EXPENSES RESIDENTIAL UNIT SALES Market Price Brokerage and Marketi~=~ Expenses TOTAL REVENUE Number TOTAL CONSTRUCTION COSTS:~ . ,i.. ~3 757,397 S536,T11 Unit Price Unit Total Price/Unit 10,500 Bldg. Sq. Ft. 10,500 Bldg. Sq. Ft. $515 /Bldg. Sq: Ft.$5,407,500 $772,500 5% of Potential Revenue (.$270,375)($38,625) $489 /Bldg. Sq. Ft.$5,137,125 $733,875 .LAND RESIDUAL VALUE ................ $131.40/Lot. Sq. F~. Notes: (a} Assumes 1,500 square foot units with wood frame high-quality construction, skylight, wood floors and full kitchen appliances. See Appendix S for a full unit detail (b) Assumes 423 square feet per space~ (c) See Appendix T for a detail list of planning, buildingl and development impact fees. (d) Financing costs are not included in calculating developer profit. Sources: RS Mean Square Foot Construction Costs, 2002; Ross Construction, 2002; Segue Construction; 2002; J.R. Roberts Construction, 2002; Classic Communities, 2002; Dollars and Cents, Multifamily Housing, 2002; BAE, 2002. A__ppendix G: Small Siter 1.15 FAR Alternative-Reduced Parkin9 . Development Program Number Unit Lot Size 10,500 Sq. Ft. Commemial Space Bldg. Sq. Ft. Retail Square Feet Bldg. Sq. Ft.Office Square Feet = Bldg. Sq. Ft. Total Condominiums 7 Units@l,500 Sq. Ft. Each Residential Square Feet 10,500 Bldg. Sq. Ft.Total Building Square Feet 10,500 Bldg. Sq. Ft. Parkin~l RequiredRetail Parking 1 Sp/250 Sq. Ft. Office Parking 1 Sp/350 Sq. Ft. Residential Parking 1.5 Sp/Unit $~eaces ¯ Parkln9 TypeSurface Parking Partially Submerged Podium Parking Underground Parking 11 11 HARD COSTS Item Number Unit Cost Unit Item Costs Price/unitSite Area Improvements 10,500 Sq. Ft.$6 /Sq. Ft.$63,000 $9,000Residential Building (a)10,500 Bldg. Sq. Ft.$160 /Bldg. Sq. Ft.$1,680,315 $240,045Podium Parking (b!4,700 ScI. Ft,$45 ISq. Ft.$211,500 $30,214TOTAL10,500 Bldg. Sq. FL $1,954,815 $279,259 SOFT COSTS Item Number Unit Cost Unit Item Costs Price/UnitArchitecture Fees $1,954,815 Total Hard Costs 5% of Total Hard Costs $97,741 $13,963Engineering Fees $1,954,815 Total Hard Costs 2.5% of Total Hard Costs $48,870 $6,981Defect Liability Wrap Insurance 1 Project $420,000 $3 Million in Coverage $420,000 $60,000Video Recording of Construction 1 Project $50,000 /Project $50,000 $7,143rDeveloement Impact Fees and Buildinq Fees Development Impact Fees 7BMR Residential In-Lieu Fee $5,250,000Building Fees Plumbing, Mechanical, and Electric 10,500’ Bldg. Sq. Ft.Building Fees $1,954,815 Total Hard Costs Units $6,930 /Unit $48,510 $6,930Appraised Apt Value 5% *Appraised Apartment Value $262,500 $37,500 Excavation Fees 6,300 Cubic YardsSchool Fees 10,500 Living Area Plan Check Fees 1 Project Utility Fees 1 Project . Construction Financing] Cost.~ Loan to Value Ratio $2,963,949 Total Value Length of Construction Period 16 months Drawdown Factor $2,222,962 Total Loan Construction Loan Rate $2,222,962 Total Loan Loan Fees $2,222,962 Total Loan Project Contingency $3,130,671 Hard & Soft Costs TOTAL SOFT COSTS $0.18 /Bldg. Sq. Ft.$1,890 $270$5,892 + $3.85/additional $1,000 $9,664 $1,381$1,000 + $100/additional 1,000 C.Y.$1,600 $229$2.14 Bldg. Sq. Ft. of Living Area $22,470 $3,210$20,589 /Project $20,589 $2,941$25,300 /Project $25,300 $3,614 0.75 of Total Value 0.60 of Total Loan 7.5% of Total Loan/Year $133,378 $19,054’1.5% of Total Loan $33,344 $4,7635% of Hard & Soft Costs $156,534 $22,362 $1,332,390 $190,341 DEVELOPER PROFIT $3,120,483 Hard & Soft Costs (d)10% of Hard & Soft Costs (d)$312,048 $44,578 TOTAL REVENUE REVENUES and EXPENSES Number Unit RESIDENTIAL UNIT SALES Market Price 10,500 Bldg. Sq. Ft. Brckera~e and Marketin~ Expenses TOTAL REVENUE 10,500 Bldg. Sq. Ft. Price Unit CONSTRUCTION COSTS:~ i$3,~9g~253 $5i4,i79 LAND RESIDUAL VALUE . Total Price/Unit $500 /Sq. Ft.$5,250,000 $750,0005% of Potential Revenue ($262,500)($37,500)$475 /Sq. Ft.$4,987,500 $712,500 $132.21 /Lot Sq. Ft... ". ~$198,321 Notes: (a) Assumes 1,500 square foot units with wood frame construction, high-quality construction, skylight, wood floors and full kitchen appliances. See Appendix S for a full unit detail (b) Assumes 427 square feet a space. (c) See Appendix T for a detail list of planning, building, and development impact fees. (d) Financing costs are not included in calculating developer profit. Sources: RS Mean Square Foot Cons~uction Costs, 2002; Ross Construction, 2002; Segue Construction; 2002; J.R. Roberts Construction, 2002; Classic Communities, 2002; Dollars and Cents, Multifamily Housing, 2002; BAE, 2002. Appendix H: Small Site~ 1.5 FAR Alternative-Standard Parkin~l .Development Program Number UnitLot Size 10,500 Sq. Ft. Commercial Space Bldg. Sq. Ft.Retail Square Feet Bldg. Sq. Ft.Office Square Feet Bldg. Sq. Ft.Total Condominiums "10 Units@l,500 Sq. Ft. Each Residential Square Feet 15,000 Bldg. Sq. Ft.Total Building Square Feet 15,000 Bldg. Sq. Ft. Parkin9 Required ~acesRetail Parking 1 Sp/250 Sq. Ft. Office Parking 1 Sp/250 Sq. Ft. Residential Parking .2.3 Sp/Unit 23 Parking Type Surface Parking Partially Submerged Podium Parking Underground Parking ~Daces 23 HARD COSTS Item Number Unit Cost Unit Item Costs Price/UnitSite Area Improvements 10,500 Sq. Ft.$6 /Sq. Ft.$63,000 $6,300Residential Building (a)15,000 Bldg. Sq. Ft..$151 /Bldg. Sq. Ft.$2,259,000 $225,900Podium Parking (b)9,775 Sq. Ft.$45 /Sq. Ft.$439,875 $43,988TOTAL15,000 Bldg. Sq. Ft.$2,761,875 $276,188 SOFT COSTS Item Number UnitArchitecture Fees $2,761,875 Total Hard Costs Engineering Fees $2,761,875 Total Hard Costs Defect Uability Wrap Insurance 1 Project Video Recording of Construction 1 Project Development Impact Fees and Buildinq Fees ((1) Development Impact Fees 10 Units Building Fees Plumbing, Mechanical and Electric 15,000Building Fees $2,761,875 Excavation Fees 13,100 " School Fees 15,000 Plan Check Fees 1 Utility Fees 1 ~ Construction Financinq Cost.~ Loan to Value Ratio $3,617,098Length of Construction Period 16Drawdown Factor $2,712,823 Construction Loan Rate $2,712,823Loan Fees $2,712,823 Project Contingency.$3,820,560 TOTAL SOFT COSTS Cost Unit 5% of Total Hard Costs 2.5% of Total Hard Costs $420,000 $3 Million in Coverage $50,000 /Project $6,930 /Unit Bldg. Sq Ft..$0.18 /Bldg. Sq. Ft. Total Hard Costs $5,892 + $3.85/additional $1,000 Cubic Yards $1,000 + $100/additional 1,000 C.Y. Living Area $2.14 Bldg. Sq. Ft. of Living Area Project $25,680 /Project Project $33,150 IProject Total Value 0.75 of Total Value months Total Loan 0.60 of Total Loan Total Loan 7.5% of Total Loan/Year Total Loan 1.5% of Total Loan Hard & Soft Costs 5% of Hard & Soft costs DEVELOPER PROFIT Item Coats Price/Unit $138,094 $13,809 $69,047 $6,905 $420,000 :$42,000 $50,000 $5,000 $69,300 $6,930 $2,700 $270 $12,852 $1,285 $2,300 $230 $32,100 $3,210 $25,680 $2,568 $33,150 $3,315 $162,769 $16,277 $40,692 $4,069 $191.028 $19,103 $1,249,712 $124,971 $3,808,126 Hard & Soft Costs (d)10% of Hard & Soft Costs (d)$380,813 $38,081 REVENUE REVENUES and EXPENSES RESIDENTIAL UNIT SALES Market Price Below Market Rate Unit Price (e) Brokerage and Marketing Expenses TOTAL REVENUE TOTAL CONSTRUCTION COSTS: ....$4,392,400 i.... Number Unit Price Unit Total Price/Unit 13.500 Bldg. S~ Ft.$515 /Bldg. Sq. Ft.$6,952,500 $772,5001,500 Bldg. Sq Ft.$164 /Bldg. Sq. Ft.$245,388 $245,3885% of Potential Revenue ($359,894)($35,989)15,000 Bldg. Sq. FL $456 /Bldg. Sq. Ft.$6,837,994 $683,799 LAND RESIDUAL VALUE $2.32.91 /Lot Sq. eL [ $2,445,594-=’] $244,559 Notes: (a) Assumes 1,500 square foot units with wood frame construction, high-quality construction, skylight, wood floors and full kitchen appliances. See Appendix S for a full unit detail (b) Assumes 425 square feet per space. (c) See Appendix T for a detail list of planning, building, and development impact fees. (d) Financing costs are not included in calculating developer profit. (e) The below market rate unit price is based on Santa Clara County’s median income for a four person household according to the Department of Housing and Community Development. See Appendix U for an explanation of the BMR home ;)rice. Sources: RS Mean Square Foot Construction Costs, 2002; Ross Construction, 2002; Segue Construction; 2002; J.R. Roberts Construction, 2002; Classic Communities, 2002; Dollars and Cents, Multifamily Housing, 2002; BAE, 2002. Appendix I: Small Site~ 1.5 FAR Alternative-Reduced Parking . Development Program Number Unit Lot Size 10,500 Sq. FL Commercial Space Sq. Ft. Retail Square Feet Office Square Feet Sq. Ft. Total Condominiums 10 Units@l,500 Sq. Ft. Each Residential Square Feet 15,000 Bldg. Sq. Ft.Total Building Square Feet 15,000 Bldg. Sq. Ft.- Parkin~l Requlrad Retail Parking 1 Sp/250 Sq. Ft. Office Parking 1 Sp/350 Sq. Ft. Residential Parking 1.5 Sp/Unit spaces 15 Parking Type Spaces Surface Parking Partially Submerged Podium Parking 15 Underground Parking - HARD COSTS Item Number UnitSite Area Improvements 10,500 Sq. Ft. Residential Building (a)15,000 Bldg. Sq. FL. Podium Parking (b)6,400 Sq. Ft.TOTAL 15,000 Bldg. Sq. Ft. SOFT COSTS Item Number Architecture Fees $2,610,000 Engineering Fees $2,610,000Defect Liability Wrap Insurance 1Video Recording of Construction 1 Develol0ment Imoact Fees and Buildin.q Fees~} Development Impact Fees 10 Building Fees Plumbing, Mechanical, and Electdc 15,000Building Fees $2,610,000 Unit Total Hard Costs Total Hard Costs Project Project Units Bldg, Sq. Ft.. Total Hard CostsExcavation Fees School Fees Plan Check Fees Utility Fees Construction Financinq Co~t.~ Loan to Value Ratio Length of Construction Pedod Drawdown Factor Construction Loan Rate Loan Fees Pmiect Contin~en~ TOTAL SOFT COSTS 8,600 Cubic Yards 15,000 Living Area 1 Project 1 Project $3,451,829 Total Value 16 months $2,588,872 Total Loan $2,588,872 Total Loan $2,588,872 Total Loan $3,645,995 Hard & Soft Costs Cost Unit Item Costs Price/Unit $6 ISq. Ft.$63,000 $6,300 $151 /Bldg. Sq. Ft.$2,259,000 $225,900 $45 ISq. Ft.$288,000 $28,800 $2,610,000 $261,000 Cost Unit Item Costs Price/Unit 5% of Total Hard Costs $130,500 $13,050 2.5% of Total Hard Costs $65,250 $6,525$420,000 $3 Million in Coverage $420,000 $42,000 $50,000 /Project $50,000 $5,000 $6,930 /Unit $69,300 $6,930 $0.18 /Bldg. Sq. Ft.$2,700 $270$5,892 + $3.85/additional $1,000 $12,252 $1,225$1,000 + $100/additional 1,000 C.Y.$1,800 $180$2.14 Bldg. Sq. Ft. of Living Area $32,100 $3,210$24,778 /Project $24,778 $2,478$33,150 /Project $33,i50 $3,315 0.75 of Total Value 0.60 of Total Loan 7.5% of Total Loan/Year $155,332 $15,533 1.5% of Total Loan $38,833 $3,883 5% of Hard & Soft Costs $182,300 $18,230 $1,2,18,294 $121,829 DEVELOPER PROFIT $3,634,129 Hard & Soft Costs (d)10% of Hard & Soft Costs (d)$363,413 $36,341 REVENUES and EXPENSES RESIDENTIAL UNIT SALES Market Price Below Market Rate Unit Price (e) Brokerage and Marketin~ Expenses TOTAL REVENUE LAND RESIDUAL VALUE Number Unit TOTAL CONSTRUCTION COSTS:. ~.. $4,_!.9!17~.7 ’ ".~.~!_$4~9 17~i Price Unit Total Price~nlt 13,500 Bldg. Sq. Ft.$500 /Bldg. Sq. Ft.$6,750,000 $750,0001,500 Bldg. Sq. Ft.$164 /Bldg. Sq. Ft.$245,388 $245,388 5% of Potential Revenue ($349,769)($34,977!15,000 Bldg. Sq. Ft.$443 /Bldg. Sq. Ft.$6,645,619 $664,562 ...-: .....S233.71/Lot. Sq.:Ft. ~;- .-] S2,453,911 J . S245 391 Notes: (a) Assumes 1,500 square foot units with wood frame construction, high-quality construction, skylight, wood floors and full kitchen appliances. See Appendix S for a full unit detail (b) Assumes 425 square feet per space. (c) See Appendix T for a detail list of planning, building, and development impact fees. (d) Financing costs are not included in calculating developer profit. (e) The below market rate unit price is based on Santa Clara County’s median income for a four person household according to the Department of Housing and Community Development. See Appendix U for an explanation of the BMR home price. Sources: RS Mean Square Foot Construction Costs, 2002; Ross Construction, 2002; Segue Construction; 2002; J.R. Roberts Construction, 2002; Classic Communities, 2002; Dollars and Cents, Multifamily Housing, 2002; BAE, 2002. Appendix J: Small S|te~ 2.0 FAR Alternative-Standard Parking! O~valopment Program Number UnitLot Size 10,500 Sq. FL Commercial Space B~dg. Sq. FLRetail Square Feet Bldg. Sq. FL ~ Square Feet Sldg. Sq. FLTotal Condominiums 14 Ualts@l,$80 Sq. FL Each Reeldsn6al Squ~ra Feet 21,000 Bldg, Sq. FL Reeident~al Corridor CirculaUon 1,000 Bldg. Sq. FLTotal Building Square Feet 22,000 Bldg. Sq, Ft. Perktn~R~lulrad Reta=l Parking 1 Sp/250 Sq. FL O~ce Parking I Sp/250 Sq. FL Residential P~’ldng 2.3 Sp/Unlt Tuck-Under Alley Perking Parl~ally Submerged Podium Perking Underground Parking (a)33 HARD COSTS Item Number Unit Coat Unit Item Costa PrlcelUnltSite Area Improwments 10,500 Sq. Ft.$6 ISq. Ft.$63,000 $4,500Reeidenl~l Building (b)22,000 Bldg. Sq. FL.$152 /Bldg, Sq.FL $3,347,080 $239,077Underground Psddn~ Ic)15~675 Sq. Ft.$75 ~.. Ft.$1,175,625 . $83,973TOTAL22,000 Bldg. Sq. FL $4,585,705 $327,550 SOFT COSTS Item Number Unit Cost Unit Item Ceeta Prlce/UaltArctdteeture Foes $4,585,705 Total Herd Costs 5% of Total Herd Costs $229,285 $16,378Engineering Fees $4,585,705 Total H~d Costs.2.5% of Total Hard Ceets $114,643 $8,189Defect Liability Wrap Insurance .1 Project $420,000 $3 Million in Coverage $420,000 $30,000Video Recording of ConstnJct~on 1 Pmjeet $50,000 Project $60,000 $3,571Devefooment ImPact Fees and Butidine Fees t’c~ Units $6,930 /Unit $97,020 $8,930Appraised Apt Value (e)5% °Appraised Apartment Value $154.500 $11.036 $0.18 /Bldg. Sq,FL $3,960 $283 $5,892 ÷ $3,85/nddit~eesl $1,000 $20,057 $1,433$2,000 ÷ $100/sddti~onal 10,000 C.Y.$2,200 $157 $2.14 /Bq. Ft. of Living Area $44,940 $3,210$36,910 /Project $66,910 $2,636$40,950 /Project $40,950 $2,925 0.75 of Total Value 0.60 of Total Loan 7.5% of Total Loan/Year $293,634 $20,9741.5% of Total Loan $85,252 $4,6615% of Hard & Soft costs $307,953 $21,997 $1,881,303 $134,379 Development Impact Fees 14 BMR Fee $3,090,000Building Fees Plumbing, Mechanical, and Electric 22,000 Bldg. Sq. FL. Suilding Fees $4,585,705 Total Hard CostsEacavaUon F~24,400 Cubk= YardsSc~ Fees Residential 21,000 Living AreePlan Check Fees 1 ProjectUtility Fees 1 Project Construction Financinq COSt# Loan to Value Ratio $8,800,170 Total ValueLength of Construction Period 18 months Drawdown Factor $4,350,127 Total Loan Const~Jction Loan Rate $4,350,127 Total Loan Loan Fees $4,350,127 Total Loan Proiect Contingency/$6,159,055 Herd & Soft Cost~TOTAL SOFT COSTS DEVELOPER PROFIT $6,108,123 Ha~d & Soft Costa (e)10% of Hard & Soft Costs (d)$610,812 $43,629 REVENUES and EXPENSES Number Unit PHce Unit Total Price/UnitRESIDENTIAL UNIT SALES Market Prk:e 19,500 Bldg. Sq. FL $515 /Bldg. Sq. Ft.$10,042,500 $772,500Below Market Rate Unit Pdce (f)1,500 Bldg. Sq. Ft.$164 /Bldg. Sq. Ft.$245,388 $245,386Brokerage end Marketin~ Expenses 5% of Potentia! Revenue ($514,394)($36,742)TOTAL REVENUE $9,773,494 $698,107 Notes: (a) Assumes two levels of’undsrgiound paridng. (b) Assumes 1,500 square foot units wi~ wood fi’ame construction, high-quality constm~on, skylight, wood floors and full Idtchen appliances. See Appendix S for a flJti unit detail (c) Tuc~ Under AJley Parking assumes 250 square feet a space. Underground parking assumes 475 square feet a space. (d) See Appendix T for a detail list of planning, building, and development impact fees. (e) Financing costs are not included in calculating developer profit. (f) The below market rate unit price is based on Santa Clara County’s median income for a four person household according to the Department of Housing and Community Development. See Appendix U for an explanation of the BMR home price. Soumes: RS Mean Square Foot Cons~’uction Costs, 2002; Ross Construction, 2002; Segue ConstnJction; 2002; J.R. Roberts Construction, 2002; Classic Communities, 2002; Dotters and Cents, Mul~amily Housing, 2002; BAE, 2002. Appendix K: Small SiteT 2.0 FAR Alternative=Reduced Parkin9 , Development Pro~lrare Number Unit Lot Size 10,500 Sq. FL Commerd~l Sl~ce BIdg, Sq. Ft. Retail Square Feet Bldg. Sq. FL Offi~ Square Feet Bldg. Sq. FLTotal Condominiurea .14 Units@l,500 Sq. FL Each Reek~’~l Square Feet 21,000 Bldg. Sq. FL Residential Con’ldor Circotation 1,000 Bldg. ScI. Ft.Total Bugdthg Square Feet 22,000 Bldg. Sq. FL Paddng Required Spaces _ Retail Parking 1 Sp/250 Sq. FL O~ce Parldng 1 Sp/350 Sq. FL ReeideetJal Parking 1.5 SpA/nit 21 ~s.i’Spe~:oa Tuck-Under AJley Parking Partially S.ubmerged Podium Parking Unde~round Parking 21 HARD COST~ Item Nuraber Unit Coat Unit Item Coats Prise/UnitSite Area Improvements 10,500 Sq. FL $6 /Sq. Ft.$63,000 $4,500ResidenSal Building (a)22,000 Bldg. Sq. FL.$152 /Bldg. Sq.FL $3,347,080 $239,077Underground Parking lc!9,500 Sq. FL $70 ISq. Ft.$665,000 $47,500TOTAL22,000 Bldg. Sq. Ft.$4,075,080 $291,077 SOFT COSTS Item Number Unit Coat UnitArchitecture Fees $4,075,080 Total Hard Costs 5% of Total Hard CostsEngineering Fees $4,075,080 Total Hard Costs 2.5% of Total Hard CostsDefect Liability Wrap Insurance 1 Project $420,000 $3 Million in CoverageVideo Recording of Co~struc’don 1 Project ~50,000 /Projectt a Fees end Euitdine Fees fc) Development Impact Fees 14 Units $6,930 /UnitBMR Fee $3,000,000 Appraised Apt Value (e)5% "Appraised Apartment ValueBuilding Fees Plumbing, Mechanical, and F_.~cttic 22,000 Bldg. Sq. FL,$0.18 /Bldg. Sq,Ft.Building Fees $4,075,080 Total Hard Costs $5,892 ÷ $3.85/addit~onal $1,000Excavation Fees 14,800 Cubic Yards $2,000 ÷ $1001additional 10,000 C.Y.School Feea Residential 21,000 Living Area $2.14 /Sq. Ft. of Living AreaPlan Check Fees 1 Project $33,882 /Project Utitit~ Fees 1 Project S40,gS0 /ProjectConstnJction Finandn(~ o~. Loan toValue Ratio $5,241,605 TotalValue 0.75 of TotalValueLength of Construction Period 18 months Drawdown Factor $3,931,204 Total Loan 0.60 of Total LoanConstruction Loan Rate $3,931,204 Total Loan 7.5% of Total Loan/Year, Loan Fees $3,931,204 Total Loan 1.5% of Total Loan $5,565,929 Hard & Soft Co~ts 5% of Hard & Soft Costs TOTAL SOFT COSTS Itere Costs Price/unit $203,754 $14,554 $101,877 $7,277 $420,000 $30,000 $50,000 $3,571 $97,020 $6,930 $150,000 $10,714 $3,960 $283 $18,042 $1,289 $2,100 $150 $44,940 $3,210 $33,882 $2,420 $40,950 $2,925 $265,356 $18,954 $58,968 $4,212 $278,296 $19,878 $1,769,146 $126,368 DEVELOPER PROFIT S5,519,902 Hard & Soft Costs (d)10% of Herd & Soft Costs (d)$551,990 $39,428 TOTAL CONSTRUCTION COSTS:" $6~306~2.16 REVENUE ~ REVENUES and EXPENSES RESIDENTIAL UNIT SALES Market Price Below Market Rate Unit Pdce (e) Brokerage and Market.in~ Expenses TOTAL RESIDENTIAL REVENUE LAND RESIDUAL VALUE Number Unit Price unit Total Price/unit 19,500 /~ldg. Sq. FL $500 /Bldg. Sq. Ft.$9,750,000 $750,0001,500 /Bldg. Sq. Ft.$164 /Bldg. Sq. Ft.$245,388 $245,3885% of Potential Revenue I$499,7691 ($35,6981 $9,495,619 $678,258 " : ~ ~ .-.~" ...."$295.18 /l~0t Sq. FL .[ $3,099,403 ] $22~;366 Notes: (a) Assumes 1,500 square foot units with wood frame const:ruc~en, high-quatity construction, skylight, wood floors and full kitchen appliances. See Appendix S for a full unit detail (b) Assumes 452 square feet per space. (c) See Appendix T for a detail list of planning, building, and development impact fees. (d) Financing costs are not included in calcotating developer profit. (e) The below market rate unit price is based on Santa Clara County’s median income for a four person household according to the Department of Housing and Community DevelopmenL See Appendix U for an explanation of the BMR home pdce. Sources: RS Mean Square Feet Construction Costs, 2002; Ross Construction, 2002; Segue ConstnJction; 2002; J.R. Roberts Construction, 2002; Classic Communities, 2002; Dotiars aod Cents, MultJfamily Housing, 2002; BAE, 2002. Appendix L: Large Site, Existing Zoning Regulations (0.6 FAR) D~vetapment Pro~lram Number Unit Parklnl~l Raqulrod 8peceeLOt Size 26,250 Sq. FL Re~il Pa~ing I S~ Sq. FLC~I Spa~5,~ Bldg. ~. FL ~ P~I S~ Sq, FL 20Re~i Squ~ Feet Bldg. Sq. FL R~en~al Pa~2.1S~n~+1 Sp 16~ Square F~t .5,0~ Bldg, Sq. FL T~I ~iniums 7 U~@1,425 Sq. FL Ea~Pa~lng T~SpacesR~l~n~l Sq~m F~t 9,975 Bldg. Sq. FL Suda~ Pa~36T~I B~ing Squa~ F~t 14,975 Bldg. Sq. FL P~ium Pa~g ~’ Und~mund Ps~ng HARD COSTS Item Number Unit Cost Unit Item CoatsSite A.’ee Improvements 26,250 Sq. FL $6 ISq. FL $157,500Commercial Construction (b)5,000 Bldg Sq. Ft.$~} /Bldg. Sq.FL $450,000ResidenSal Building ()g,975 Bldg Sq. FL $140 /Bldg. Sq.Ft.$1,396,500Surface Perking (d/12,000 Sq. Ft.$8 /Bq. Ft.$96,000TOTAL14,975 Bldg Sq. Ft.--$2,100,---------~--’ 8OFT COSTS Ram Number ArcNtecturo Fees $2,100,000 Engineering Fees $2,100,000 ~o~ment Imeect Fees and Buildine Fees O~velopmant Iml:~Ct Fees Commerdal 5,000 Re~ldenUal 7BMR Reeldenth~l In-L~u Fee $2,O42,381Budding Fees Rumb~ng, Mechanical, end Eloc~ic 14,975Bui~ling Feea ’ ¯ $2,100,000Bchool Fees Unit Coat Unit Item CostsTotal Hard Costs 5% of Total Hard Costs $I05,000Total Hard Costs 2.5% of Total Hard Coats $52,500 BIdg Sq. FL $18.75 /Bldg. Sq.FL $93,750Uni~1,425 Sq. FLEa $6,930 /Unit $48,510Appr~deed .&~t Value 5% "Appraised Aparm~ent Valu e $102,119 Bldg Sq, FL $0.18 /Bldg’. Sq.Ft.$2,696Total Hard Costs $5,892 + $3.85/additional $1,000 $10,237 Commercial 5,000 Bldg Sq. FL $0.34 /Bldg. Sq.Ft.$1,700Reeld~ntial 9,975 Bldg Sq. FL $2.14 /Bldg. Sq.FL $21,347Plan Check Fees 1 Project $20,750 Project $20,750UUlity Fees 1 Project $75,550 /Project $75,550~7~nstruction Ftnan~nq Costs Loan to Value Ratio $2,634,158 Total Value 0,75 of Total ValueLength of Consb~Jction Pedod 8 monthsDrawdown Factor $1,975.618 Total Loan 0.55 of Total LoanConsUuction Loan Rate $1,975,618 Total Loan 7,5% of Total Loan/Year S54,330Loan Fees $1,975,618 Total Leen 1.5% of Tbtal Loan $29,634Permanent Loan Fees S2,038,591 Permanent Loan 1% of Permanent Loan $20,386Pro~ect Contin~enc~$2,738,507 Hard&SoRCor, ts .5% of Hard & Soft Costs $136,925TOTAL SOFT COSTS $775,433 DEVELOPER PROFIT $2,771,083 Hard& Soft Costs(e)12% of Hard&Soft Costs (e)$332,530 .REVENUE REVENUES and EXPENSES Number Unit Price Unit TotalOFFICE LEASING Monthly Lease Rate (NNN)5,000 Bldg. Sq. FL $3.50 /Bldg, Sq, Ft,$17,500Less Vacancy 10% of Potential Revenue ($1,750)Monthly OperoUng Expenses 5,000 Bldg. Sq. FL ($0.35)/Bldg. Sq. Ft.($1,750)RESIDENTIAL LEASING Market Rent Monthly Lease Rate 9,975 Bldg, Sq. Ft.$1,95 /Bldg. Sq. Ft.$19,451Less Vacancy 5% of Potential Revenue ($973)Monthly/Operotin~l Expenses 7 Units 25% of Potential Revenue {$4,863!TOTAL MONTHLY REVENUE 14,975 Bldg. Sq. Ft.$1.84 /Bldg. Sq, Ft.$27,616 TOTAL CONSTRUCTION COSTS: LAND RESIDUAL VALUE NET ANNUAL REVENUE:$331,391 Capitalized Value Estimate Net Annual Revenue $331,391Capitalization Rate 8%Total Capltallsed Value $4,142,381Minus Total Development Costs $3,207,963LAND RESIDUAL VALUE $35,60 /Lot Sq. FL ~ Notes: (a) Assumes wood frame construction with tenant improvements included at $40 per square foot. See Appendix S for a full unit detail. (b) Assumes 1,500 square foot units with wood frame construction, custom quatity construction, skylight, and ful~ appliances. (c) Assumes 333 square feet a space with landscaping, (d) See Appendix T for a detail list of planning, building, and development impact fees. (e) Financing costs are not included in celcolating developer profit. (I) The estimated monthly unit expense rate is $3,600 per year. Sources: RS Mean Square Foot Construction Costs, 2002; Ross Construction, 2002; Segue Construction; 2002; J.R. Roberts Construction, 2002; Classic Communities, 2002; Dollars and Cents, Multifamily Housing, 2002; BAE, 2002. HARD COSTS Item Number Unit Cost Unit Bsm Costs’Bite Area Improvements 26,250 Sq. FL $6 /Bq. Ft.$157,500R~identkal Bu~ing (e)24,000 Bldg. Sq. FL.$150 /Bldg, Sq,FL $3,601,200Cow, mendel Building (b)5,200 Bldg. Sq, FL.$152 /~ldg. Sq.FL $790,400Surfmce Parking (c)1,000 Sq, FL $8 ISq. Ft.$8,000Tuck UnderAlley Parking (c)3,750 ’Sq. FL $30 ISq. FL $112,500Podium Parkin~ Ic)13,260 Sq. Ft.$45 ISq. Ft.$596,700TOTAL29,200 Bldg. Sq, FL $5,266,300 SOFT COSTS Item Number Unit Cost Unit Item CostaArchitecture Fees $5,266,300 Total Hard Costs 5% of Total Hard Costs $263,315Eng~eedng Fees $6,266,300 Tote] Hard Costs 2.5% of Total Hard Costs $131,658Defect Uabgity Wrap Insurance 1 Project $420,000 $3 Million in Coverage $420,000Video Recording of Constru~on 1 Project $80,000 /Project $80,000Develooment Impact Fees and Buildine Fea~ Development Impact Fees Residential 16 Units $6,930 /Unit’Commercial 5,200 Bldg. Sq. FL,$18.75 /Bldg. Sq.FLBMR Fee $4,635,000 Appraised Apt Value (e)5% "Appraised Apartment ValueBuilding Fees Plumbing, Mechanical, end Electric 29,200 Bldg, Sq, FL $0.18 /Bldg. Sq,FLBu~ing Fees $5,266,300 Total Hard Costs $5,892 + $3.85/addiflonal $1,000ExcavelJonFees17,700 CubicYards $2,000 + $100/additional 10,000 C.Y.School Fees Residential 24,0~0 UvlngAree $2.14 ISq. Ft. of LivingAreaCommercial5,200 Bldg. Bq. FL.$0.34 /Bldg, Sq.Ft,Plan Check Fees (d)1 Project $41,154 /ProjectUtility Fees (d)1 Project $52,350 /Project~onsh’uctien Finanqinq Loan toValue Rat~o $6,778,137 TotalValue 0.75 of TotalValueLength of Construction Pedod 18 menths DmwdownFactor $5,083,603 TotalLoan 0.60 of TotalLoanConstruc~on Loan Rate $8,083,603 Total Loan 7.5% of Total Leen/YeerLoan Fees $5,083,603 Total Loan 1.5% of Total LoanPermanent Loan Fees $1,167,668 Total Office Perm. Loan 1.0% of Office LoanProiect Contin~enc~$7,209,211 Hard & Soft Costs 5% of Hard & Soft CostsTOTAL 6OFT COSTS DEVELOPER PROFIT $7,138,597 Hard & Soft Costs (e)12% of Hard & Soft Costs (e) $110,880 $97,500 $231,750 $5,256 $22,747 $2,100 $51,360 $1,768 ¯ $41,154 $82,350 $343,143 $76,254 $11,677 $360,461 $2,303,371 $856,632 TOTAL CONSTRUCTION COSTS: REVENUE ’: ....’i:" .................. REVENUE6 and EXPENSES Number Unit Price UnitRESIDENTIAL UNIT SALE6 Mad<at Pdce 22,500 /Bldg. Sq. Ft.$515 /Bldg. Sq. Ft. Below Market Rate Unit Pr~:e (f~1,500 /Btdg. Sq. Ft.$164 /Rldg, Sq, Ft. Brokerage and Marketin~ Expenses 5% of Potential RevenueTOTAL RESIDENTIAL REVENUE COMMERCIAL LEASING Monthly Office Lease Rate (NNN)2,500 Bldg. Sq. FL Monthly Retail Lease Rate (NNN)2,700 Bldg, Sq. FL Less Vacancy Monthl7 Operating Expenses 5,200 Bid9. Sq. Ft.TOTAL COMMERCIAL LEASING REVENUE Annual Revenue COMMERCIAL CAPITALIZED VALUE $168,210 /Year ~,425,303 Total Price/Unit $11,587,500 $772,500 $245,388 $245,388 <$591,6441 ($36,978~$11,241,2,~$702,578 $3.50 /Bldg Bq. Ft.$5,750$3.25 /Bldg Sq. Ft.$8,775 10% of Potential Revenue {$1,753)($0.341 /Bld~ Sq. Ft.~$14,018 Capitalization Rate Capitalized Value 8% /Annual Revenue $2,102,625 TOTAL PROJECT VALUE J Sl 3,343,06~ LAND RESIDUAL VALUE ....$187,34/Lot Sq, FL I $4,917,566 I " Notes: (a) Assumes 1,500 square foot units with wood frame construction, high-quality constz’u~on, skylight, wood ricers and full kitchen appliances. See Appendix S for a full unit detail (b) Assumes wood frame construction on stucco. Tenants are ground floor restaurant and small office user. See Appendix S for building detail, (c) Assumes 250 square feet per space for surface parking & tuck under altsy, and 340 square feet per space for podium parking. (d) See Appendix T for a detail list of planning, building, and development impact fees. (e) Financing’costs are not included in calculating developer profit. (f) The below market rate unit pdce is based on Santa Clara County’s median income for a four person household according to the Department of Housing and Community Development. See Appendix U for an explanation of the BMR home pdce. Sources: RS Mean Square Foot Construction Costs, 2002; Ross Construction, 2002; Segue Construction; 2002; J.R. Roberts Construction, 2002; Classic Communities, 2002; Dollars and Cents, Muitifamily Housing, 2002; BAE, 2002. Appendix N: Large Stte~ 1.15 FAR Alternative-Reduced Parkin~l HARD COSTS Item Number Unit Coat Unit Item Coats Site Area Improvements 25,250 Sq. FL $8 /Sq. FL . $157,500 Roold~ni~al Building (a)24,000 Bldg, Sq. FL $150 /Bldg. Sq.Ft.~ $3,601,200Commendel Building (b)5,200 Bldg. Sq, FL.$152 /Bldg. Bq.FL $790,400 Sul’fsce Paddng (c)1,000 Sq. FL S8 /Sq, Ft.$8,000 Tuck UnderAIley Parking (c)3.750 Sq. FL S30 /Bq, FL $112.500 Podium Perking (c)8.160 ~. FL =$45 ISq. Ft.S367.200 TOTAL 29,200 Bldg. Bq, Ft.$5,036,000 SOFT COSTS item Number An:hitectora Fees $5.036,800 Engiooering Foos $5,036.800 Defect Liability Wrap Insurance 1 Video Recording of Conetruc~mm 1 .=~.~e!oom~nt Imooqt Fees and Buildina Fees (dJ Development Impact Fees R~ldent~el t6 Commemial 5.200 BMR Fee $4,500,000 Bulk:ling Fooa Plumbing, Mechanical, end F3e¢~ic 29.200 Building Fees $5,035,800 Excavation Feos 10.900 School Fees Resident|el Commercial Plan Check Fees U b’lity Fees ConstTuc~on F|nancino Casts Loan to Value R~Uo Length of Construction Period Drawdow~ Factor Construction Loon Rate Loan Fees Permanent Loan Fees Pmiect Co~’~tingenc~/ TOTAL SOFT COSTS Unit Cost Unit Item Costs Total Hard Costs 5% of Total Herd Costs S251,840 Total Hard Costa 2.5% of Total Herd Costs S125,g20 Project ~42G,000 $3 Million in Coverage $420,000 Project $50.0OO /Project $30.000 Units $8,930 /Unit S110,880 Bldg. Sq. FL.$18.75 /Bldg. Sq.FL $87,500 Appraised Apt Value (d)5% "Appraised Apartment Value $225,000 Bldg. Sq. Ft.~0.18 /Bldg. Sq.Ft.$5,256 Total Hard Costs $5,892 + $3,85/addlUonal S1.000 $21,838 Cubic Yerds S2,000 + $1001eddldoool 10.000 C.Y.S2,100 24,000 UvingAraa $2.14 /Bq. Ft. of Living Area $51,360 5,200 Bldg. Sq, Ft.,$0,34 /Bldg. Sq.FL $1,768 1 Project S39.788 Project S39.788 1 Project $82.350 /Project $82,350 $6.522,400 TotalValua 0.75 of TotalValue 18 months $4,891.800 Total Loon 0.60 of Total Loan $4,891,800 Total Loan 7.5% of Total Loan/Year $330,197 $4,891,800 TotalLoan 1.5% of TotalLoon $73,3T’/ S1,167,668 Total Office Penn. Loa~1.0% of Office Loan $11.677 $8.937,650 Hard & Soft Costs 5% of Hard & Soft costs S346,883 $2,247,733 DEVELOPER PROFIT $5,869,283 Hard & Soft Costs (e)12% of Herd & Soft Costs (e)$824.314 REVENUE REVENUES end EXPENSES Number Unit RESIDENTIAL UNiT SALES Market Price 22.500 /Bldg, Sq. Ft. Below Market Rate Unit Price (f)1,500 /Bldg, Sq. Ft, Brokera~le and Markettr~ Expenses TOTAL RESIDENTIAL REVENUE TOTAL CONSTRUCTION COSTS:$8,108,8~7 Price Unit Total Price/Unit $500 /Bldg. Sq. Ft.$11,250,000 $750,000 $164 /Bldg. Sq. Ft.$245,388 $245.388 5% of Potential Revenue ($574,769)($35,923) $10,920,619 $682.539 COMMERCIAL LEASING Monthly Office Lease Rate (NNN)2.500 Bldg. Sq. FL Monthly Retail Lease Rate (NNN)2,700 Bldg. Sq. Ft. Less Vacancy Monthly/Operating Expenses 5,200 _Bldg. Sq. FL TOTAL COMMERCIAL LEASING REVENUE Annual Revenue COMMERCIAL CAPITALIZED VALUE $166.210 /Year TOTAL PROJECT VALUE $3.50 tBIdg Sq. FL $8,750 $3.25 /Bldg Sq. Ft.$5,775 10% of Potential Revenue (S1,753) ~Ft.($1,755) $14.018 Capitalization Rate Capitalized Value 8% /Annual Revenue $2,102,625 I LAND RESIDUAL VALUE $187.22/Lot Sq. Ft.[ $4,914,397 I Notes: (e) Assumes 1,500 sauare foot units with wood frame conalructJon, high-quality consVu~on, skylight, wood floors and full kitchen appliances. See Appendix S for a full unit detail (b) Assumes wood frame cosstrucl~on on s~ucco. Tenants are ground floor restaurant sn~ small office user. See Appendix S for building detail. (c) Assumes 250 square feet per space for surface perking & tuck under alley, and 340 square feet per space for podium parking. (d) See Appendix T for a detail list of planning, building, and development impact fees, (e) Financing costs are not included in calculating developer profit. (f~ The below marXet ra~e unit pdce is basso on Santa Clara County’s median income for a four person household according to the Department of Housing and Commdnity Development. See Appendix U for an explanation of the BMR home pdce. Sources: RS Mean Sauare Foot Construction Costa. 2002: Ross Construction. 2002: Segue ConsVuct~on; 2002; J.R. Roper~s Construction. 2002: Classic Communities, 2002; Dollars and Cents. Multifamily Housing, 2002; SAE, 2002. A_~p=pendix O: Lar~qe Site~ 1.5 FAR Alternative=Standard Parking _Development Program Number Unit Parking RequiredLot Size 26,250 Sq. FL Office Parking 1 Sp/250 Sq.Commend~l Space 6,200 Bldg. Sq. FL Retail Perking 1 Sp/250 Sq. FLOft~e Square Feet 2,500 Bldg, Sq. FL ’Residential Parking 2.3 Sp/unltRetail Square Feet 2,700 Bldg. Sq, FL Tol~l Condominiums 16 Unlle@l,500 Sq. FL Each1 parking Type ..........SpsceeResidential Squm’e Feet 24,000 Bldg, Sq. FL Surface Parking 4Total Building Square Feet 29,200 Bldg. Sq. FL Tuck-Under AJley Parking 15 Pa.,lletiy SubmergeS Podium Parking 39 I0 11 37 HARD COSTS Item Number Unit Cost Unit Item CostsSite Area Improvements 26,250 Sq. FL $6 ISq. Ft.S157,500Residen0al Building (a)24,000 Bldg. Sq. FL.$150 /Bldg. Sq,Ft.$8,601,200Commercial Building (b)5,200 Bidg. Sq. FL.$152 /Bldg. Sq.FL $790,400Surface Perking (c)1,000 Sq. FL $8 /Sq. Ft.$8,000Tuck Under Alley Parking (c)3,750 Sq. FL $30 tSq. Ft.$112,500Podium Parking Ic!13,260 Sq. FL $45 /Bq, Ft.$596,700TOTAL29,200 Bldg, Sq. FL $6,266,300 SOFT COSTS item Number UnitArchitecture Fees $6,266,300 Total Hard Costs Engtaeedng Fees $5,266,300 Defect Li,~bgity Wrap Insurance 1Video Recording of Consb’uctJon 1_.~evbiooment Imoact Fees and Buildino Fees ~ Development Impact Fees Residential 16Commercial5,200 BMR Fee $4,635,000Building Fees Plumbing, Mechanical, end Electric 29"200 Bulk:ling Fees $6,266,300 Cost Unit Item Costs 5% of Total Hard Costs $263,315Total Hard Costs 2.5% of Total Hard Costs $131,658ProjectS420,000 $3 Million in Coverage $420,000Project$50,000 /Project $50,000 Units $6,930 /Unit S110,880Bldg. Sq. FL,$18.75 /Bldg. Sq.FL $97,500Appraised Apt Value (e)5% "Appraised Apartment Value $231,750 Bldg. Sq. FL $0.18 /~idg. Sq.FL $5,256Total Hard Costs $5,892 + $3.851addil~onal $1,000 $22,74717,700 Cubic Yards $2,000 + $100/edditJonel 10,000 C.Y.$2,100Excavation Fees School Fees Resideet|aI Commercial Plan Check Fees Utti~ Fees Construction Finsncina C0~il~ Loan to Value Ratio Length of Constructio~ Patios Drawdown Factor Co~lstn~ctJon Loan Rate Loan Fees Permanent Loan Fees Proiect Centin~lenc~, TOTAL SOFT COSTS 24,000 Living Area $2.14 /Bq. Ft. of Living Area $51,3605,200 Bldg. Sq. FL.$0.34 /Bldg. Sq.FL $1,7681 Project $41,154 /Pmjest $41,154I Project $82,350 /Project $62,350 $6,778,137 Total Value 0.75 of Total Value18 months $5,083,603 TotslLoan 0.60 of TotalLoan $5,083,603 Total Loan 7.5% of Total Loan/Yeer $6,003,603 Total Loan 1.5% of Total Loan $1,167,668 Total Office Perm. Loan 1.0% of Office Loan $7,209,211 Hard & Soft Costs 5% of Hard & Soft costs DEVELOPER PROFIT $7,138,597 Herd & Soft Costs (e)12% of Hard & Soft Costs (e) $343,t43 $76"254 $11,677 $360,461 $2,303,371 $856,632 REVENUE, TOTAL CONSTRUCTION COSTS:; 1.1I $8,426 303 Price Unit Total Price/UnitREVENUES and EXPENSES Number UnitRESIDENTIAL UNIT SALES Market Price 22,500 /Bldg. Sq. Ft.$515 /Bldg, Sq. Ft.$11,587,500 $772,500Below Market Rate Unit Price (f)1,500 /Bldg. Sq, Ft,$164 /Bldg. Sq. Ft.$245,388 $245,388Brokera~le and Marketin~l Expenses 5% of Potential Revenue ($591,6441 1536,978!TOTAL RESIDENTIAL REVENUE $11,241,24,4 $702,578 COMMERCIAL LEASING Monthly Office Lease Rate (NNN)2,500 Bidg. Sq, Ft.$3.50 /Bldg Sq. Ft.$8,750Monthly Retail Lease Rate (NNN)2,700 Bldg. Sq, FL $3.25 /Bldg Sq, Ft.$8,775Lees Vacancy 10% of Potential Revenue ($1,753)Monthl)~ Operatin~l Expenses 5,200 Bid9. S~. Ft.($0,341 /BId~ S9. Ft.($1,755!TOTAL COMMERCIAL LEASING REVENUE $14,018 Annual Revenue COMMERCIAL CAPITALIZED VALUE $168,210 /Year TOTAL PROJECT VALUE Capitalization Rate Capitalized Value 8% /Annual Revenue $2,102,625 LAND RESIDUAL VALUE .....$187.34/Lot Sq. FL ~: Notes: (a) Assumes 1,500 square foot units with wood frame consthJction, high-qualit,/construction, skylight, wood floors and full kitchen appliances. See Appendix S for a full unit detail (b) Assumes wood frame construction on stucco. Tenants are ground floor restaurant and small office user. See Appendix S for building detail. (c) Assumes 250 square feet per space for surface and tuck under parking and 340 square feeis space for podium parking. (d) See Appendix T for a detait list of planning, building, and development impact fees. (e) Financing costs ere not included in calculating developer profit. (f) The below market rate unit price is based on Santa Clara County’s median income for a four person household according to the Department of Housing and community Dsvbiopment. See Appendix U for an explanation of the BMR home price. Sources: RS Mean Square Foot Construction Costs, 2002; Ross Consb’uction, 2002; Segue ConstnJction; 2002; J.R. Roberts ConstnJctlen, 2002; Classic Communities, 2002; Dollars and Cents, Multifamlly Housing, 2002; BAE, 2002. .Appendix P: Large Site. 1.5 FAR AJtemativ~Reduced Parking] HARD COST~ Item Number Unit Coat Unit Item CostsSitoAl’ea Iml~ovements 26,250 Sq. FL ~6 /Sq. Ft.$157,500ResidentJ~l Building (e)34,100 Bldg. Sq. FL.S!43 /81de. ~q.FL $4,869,480Co, martial Building (b)5,200 Bldg. Sq. FL.$152 /Bldg. Sq.Ft.$7g0,400Surfsce Pa~king (c)1.000 Sq. FL $6 /Sq. Ft.$6.000Tuck Under Alley Parking (c)3,750 Sq. FL $30 /~q. FL $112,500Podium Porldn~! (c}11,110 Sq. Ft.$45 /Sq. Ft.$499 950TOTAL ....39,300 Bldg. Sq, FL $6,437,830 SOFT COSTS ~t~m Number Unit Cost Unit ¯~em CostsArchitecture Foes $6,437,830 Toted Hard Costs.5% of Total Hard Costs $321,892Engineering Fees $6.437.830 Total Hard Costs 2.5% of Total Hord Costs $160.946D~ect Ll~bility Wrap Insurance 1 Project $420,000 $3 Million in Coverage $420,000Vldes Recording of Construction 1 Project $60,000 /Project $60,000_J~D~do~mont Imeact Fees and Buildina F~s td~ Developmest Impoct Fees Rosldent|al 22 Units $3,930 /UnitCommorci~l 5,200 Bldg. Sq. FL.$18.75 /Bldg, Sq,FLBMR Fee S1,$60,000 Appraised Apt Value (d)5% *Appraised Apartment ValueBuilding Fees Plumbing, Mechanical, and Eloclzic 39,300 Bide, Sq, FL $0.18 /Bide. Sq.FLBuildk~g Fees $6,437,830 Total Hard Costs $5,892 ", $3.851eddit~oaal $1,000Excaval~on Fess 14,900 Cubic Yards $2,000 + $1001eddil~ona110,000 C.Y.School Fees Residential 32,600 Living Area $2,14 /~q. FL of Living AreaCommorcial5,200 Bide. Sq. FL.$0.34 /Bide, Sq.FLPlan Check Fees 1 Project $48,706 ProjectUtility Fees 1 Project $68,550 /Project~..~:~sb’uc~on Financino Co~i|~ LoestoVaiue Ratio $7,970,962 TotalVaiue 0.75 of TotalValueLength of Construction Pedod 20 monthsDrawdow~ Factor $5,978,221 Total Loan 0.60 of Total LoanCanstract~on Loan Rate $5,978,221 Total Loan 7.5% of Total Loan/YearLoan Fees $3,978,221 Total Loan 1.5% of Total LoanPermanent Loan Fees $1,167,668 Total Office Porto. Loan 1.0% of Office LoanProject Contingency/$8,520,678 Hard & Soft Costs 5% of Hard & Soft costsTOTAL SOFT COSTS DEVELOPER PROFIT $6,396,996 Hard & So~I Costs (e)12% of Hard & So~t Costs (e) $152,460 $97,500 $75,000 $7.074 $27.372 $2.100 $69,764 $I,768 $48,706 $66,550 $448,367 $69,673 $11,677 $426,034 $2,508,882 $1,007,639 REVENUES and EXPENSES Number UnitRESIDENTIAL UNIT SALES Market Pdce 30,000 /Bldg. Sq. Ft. Bolow Market Rate Unit Pdce (e)2,600 /Bldg. Sq. Ft. Brokerage and Marketing Expenses TOTAL RESIDENTIAL REVENUE COMMERCIAL LEASING Monthly Offico Lease Rate (NNN) Monthly Retail Lease Rate (NNN) Less Vacancy Monthly, Operatin~ Expenses TOTAL COMMERCIAL LEASING REVENUE 2,500 Bldg. Sq. Ft. 2,700 Bldg. Sq. FL 5,200 Bid9. Sq. FL Annual Revenue COMMERCIAL CAPITALIZED VALUE $168,210 /Year TOTAL PROJECT VALUE LAND RESIDUAL VALUE Notes: TOTAL CONSTRUCT/ON COSTS::~ $9;954,352 Price Unit Total PrlcolUnlt $3.50 /Bide Sq. Ft.$3,750$3.25 /Bldg Sq. Ft.$8,77510% of Potential Revenue ($1,753)($o.3~1/B~d~ S~. Ft.~$14,018 Capitalization Rate ,Capitalized Value8%/Annual Revenue $2,102,625- I S16,811i,862--2~ $261.51 /Lot Sq. FL ~ (a) Assumes 20 units at 1,500 square feet end two units at 1,300 square feet with wood frame constm~on, high-quality construction, skylight, wood floors and full kitchen appliances. See Appendix S for a full unit detail (b) Assumes wood frame construction on stucco. Tenants am ground floor restaurant and small office user. See Appendix S for building detail. (c) Assumes 250 square feet per space for su~ace ond tuck under parking and 340 square feet e space for podium parking. (d) See Appendix T for e detail list of planning, building, and development impact fees. (e) Financing costs are not included in calculating developer profit. (~) The bolowmarket rate unit price is based on Santa Clara County’s median income for a four person household according to the Deparb"nent of Housing and Community Development. See Appendix U for an explanation of the BMR home pdce. Sources: RS Mean Square Foot Construction Costs, 2002; Ross Construction, 2002; Segue Construction; 2002; J.R. Roberts Construction, 2002; Classic Communities, 2002; Dollars and Cents, Multifamily Housing, 2002; BAE, 2002. $500 /Bldg. Sq. Ft.$15,000,000 $750,000$189 /~ldg. Sq. Ft.$490,776 $245,388 5% of PotantielRevenue (S774,539!~$14,716,237 $668,920 Development Program Number UnitLot Size 26,250 Sq. FL Commer~al Space 7,000 Bldg. Bq. FLOffice Square Feet 4,000 Bldg. Sq. FL Retail Squ~re Feet 3,000 Bldg, Sq, FL Total Condominiums (e)20 Units@l,500 Sq. FL each Residential Squ~ Feet 30,000 Bldg. Sq. FLResiden~l Corridor Circutstion 1,500~Total Building Square Feet 38,500 Bldg, Sq. FL Psrktn~Required SIOffice Parking 1 Sp/250 Sq. FL 16Retail Parking 1 Bp/250 Sq, FL 12Residential Parking 2.3 Sp/Unit 46 Parkln~ T~pe SpacesSu~ace Paddng 19 Partially Submerged Podium Parking ~26 Underground Pedium Parking 29 HARD COSTS Item Number Unit Coat Unit Item CostaSlteArsa Improvements 26,250 Sq. FL $6 ISq. Ft.$157,500Open Space Improvements 2,000 Sq. FL $20 /Sq. Ft.$40,000Residential Building (a)31,500 Bldg. Sq, FL $150 /Bldg, Sq. Ft.S4,726,575Commendsl Building (b)7,000 Bldg. Sq, FL $152 /Bldg. Sq. Ft.$1,064,000Su~l’ace Peddng (c)4,750 Sq. FL 58 ISq. Ft.538,000Partially Submerged Podium Parking (7,700 Sq, FL $45 /Sq. Ft.-$346,500Under~mund Parkin~ Ic!10,500 Sq. Ft.$70 /Sq. Ft.$735,000TOTAL38,500 Bldg. Sq. Ft.= $7,107,575=" SOFT COSTS Item Number UnitArchitecture Fees $7,107,575 Total Hard CostsEngineering Fees 57,107,575 Total Hard CostsDefect Uabilib/Wrap insurance 1 ProjectVideo Receding of ConslmctJon 1 Project,~Develeement Im~ct Fees end Buildin(~ Fees Development Impact Fees Residential 20 UnitsCommercial7,000 Bldg. Sq. FLBuilding Fees Plumbing, Mechanical, end Electric 38,500Building Fees $7,107,575Excavation Fe~s 26,600 Bldg. Sq. FL Total Hard Costa Cubic Yards Cost Unit Item Costs 5% of Total Nard Costs $355,379 2,5% of Total Hard Costs $177,689$420,000 53 Million in Coverage $420,000S60,000 /Project $60,000 $6,g30 /Unit 5138,600$18.75 /Bldg, Bq. FL $131,250 School Fees Residendal 30,000 Lk, ingAree $2.14 /Bq. Ft. of LivingAreaCommercial7,000 Bldg, Sq. FL $0.34 /Bldg. Sq. Ft.Plan Check Fees 1 Project $52,485 /ProjectUtility Fees 1 Project $88,150 /project_Construction Financino Co~ Loan to Value Ratio $8,636,856 Total Value 0.75 of Total ValueLength of Construction Pedod 20 monthsDrowdow’nFactor 56,477,642 TotalLoan 0.60 of Total LoanConstnJc0on Loan Rate $6,477,642 Total Loan 7.5% of Total Loan/YearLoan Fees $5,4T/,642 Total Loan 1,5% of Total LoanPermanent Lees Fees $1,739,630 Total Office Perm. Loan 1,0% of O/tics LoanPro]eel Contin~enc,/$9,237,240 Hard & Soft Costs 5% of Hard & Soft CostsTOTAL SOFT COSTS $0.18 /Bldg. Sq. Ft.$6,93055,892 * $3:851additJonsl $1,000 $30,019 52,000 ÷ 5100/additional 10,000 C.Y.$2,200 $54.200 $2,380 $52.485 S88,150 $485,823 $97,165 $17,396 $461,862 $ 2,591,527 DEVELOPER PROFIT S9,098,718 Herd & Soft Costs (e)12% of Hard & Soft COSts (e)$1,091,846 TOTAL CONSTRUCTION COSTS: REVENUE ....:: ....., . ¯ REVENUE5 and EXPENSES Number Unit Price Unit Total Price/UnitRESIDENTIAL UNIT SAL.ES Market Pdce 27,000 /Bldg, Sq. Ft.$515 /Bldg. Sq. Ft.$13,905,000 $772,500Below Market Rate Unit Pdce (f)3,000 /Bldg. Sq. Ft.$164 /Bldg. Sq, Ft.$490,776 $245,388Brokerage and Marketin~l Expenses 5% of Potential Revenue ($719,789/ I$55,989)TOTAL RESIDENTIAL REVENUE 513,675,987 $683,799 COMMERCIAL LEASING Monthly Office Lease Rate (NNN)4,000 Bldg. Sq. Ft.$3.50 /Bldg Sq. Ft.$14,000Monthly Retail Lease Rate (NNN)3,000 Eldg. Sq. Ft.$3.25 /Bldg Sq. FL $9,750Less Vacancy 10% of Potential Revenue ($2,375)Monthly Operating Expenses 7,000 Bldg. Sq. Ft.($0.34! IBIdg S~. Ft.($2,363ITOTAL COMMERCIAL LEASING REVENUE $t9,013 Annual Revenue Capitalization Rate ~s COMMERCIAL CAPITALIZED VALUE $228,150 /Year 8% /Annual Revenue $2,851,875 TOTAL PROJECT VALUE I $16,527,862~LAND RESIDUAL VALUE $219 /Lot Sq, FL I $5,736,914 I Notes: (a) Assumes 1,500 square foot units with wood frame construction, high-quality construction, skylight, wood floom and full kitchen appliances. See Appendix S for a full unit detail (b) Assumes wood frame construc6on on stucco. Assumed tenant is a ground fleer restauranL See Appendix S for building detail. (c) Assumes 250 square feet per space for tuck under parking and podium parking, and 360 square feet per space far underground parking. (d) See Appendix T for a detail list of planning, building, and development impact fees. (e) Financing costs are not included in calculating developer profit. (f) The below market rate unit pdce is based on Santa Clara County’s median income for a four person household according to the Department of Housing and Community Development. See Appendix U for an explanation of the BMR home price. Sources: RS Mean Square Foot Construction Cos!s, 2002; Ross Construction, 2002; Segue Construction: 2002; J.R. Roberts Conslruction, 2002; Classic Communities, 2002; Dollars and Cents, Multifamily Housing, 2002; BAE, 2002. Appendix R: Large Site, 2.5 FAR Alternative-Reduced Parkin~ ,Developmant Pre~lrom Number Unit Lot Size 26,250 Sq. Ft.Commercial Space 5,550 Bldg. Sq. FL Ornce Square Feet 2,800 Bldg. Sq. FLRetail Square Faal 2,750 Bldg. Sq. FL Total Condomink~ms (a)33 UNtsResldenUal Square Feet 45,750 Bldg. Sq, FL Residential Circulation 2,000 Bld~, Sq. FL~Total Building Square Feat 53,300 Bldg, Sq. FL Perkln~!Required SpacesOffice Paddng 1 Sp/350 5q, FL 8Ratall Parking 1 Sp/250 Sq. FL , 11Rosklen~al Parking 1.5 Sp/Unit 50 Pe~in~ T~fpe SpacasSurface Parking 19Partially Submerged Podium Parking 26Uodarground Pal~dhg 24 HARD COSTS Item Number Unit Coat Unit Item CoatsSite Atee Improvements 26,250 Sq. FL $6 ISq, Ft.$157,50"===~ResldenUal Building (a)47,750 Bldg, Sq, FL,$150 /Bldg, Sq.FL $7,176,348Commercial Building (b)5,550 Bldg. Sq. FL,$152 /Bldg. Bq.FL $843,600Surface Parking (c)4,750 8q. FL $8 /Sq. Ft,$38,000Podium P~’tdng (c)7,700 Sq. FL $45 /Sq, FL $346,500Und~round Parkin~l (c)8,640 Sq. FL $70 /Sq, Ft.$604 800TOTAL53,300 Bldg. Sq. FL $9,166.748 5OFT COSTS Burn Number UnitArchitecture Feas $9,166,748 Total Hard CostsEngineer~ing Fees $9.166,748 Total H~u’d CostsDefect Liability Wrap Insurance 1 Video Recording of Construction 1 ~Dect Fees ar~Development Impact Fees Residential 33Commercial6.550BMR Fee $2,100,000Building Fees Plumbing, Mechanical, and Electric 53,300Building Fees $9,166.748 Coat Unit Item Coats 5% of Total Hard Costs $458,337 2.5% of Total Hard Costs $229.169Proj~-t $420,000 $3 Million in Coverage $420,000Proj~’t $60,000 /Prej~ct $60,000 Units $6.930 /Unit S228,690Bldg. Sq. FL.$18.75 /Bldg. Sq,FL $I04,063Appraised Apt Value (e)5% "Appraised Apsrlment Value $105,000 Bldg. Sq, FL $0.18 iBI0g. Sq,FL $9,594Total Hard Costs $5,892 ÷ $3.851additional $1,000 $38.15223,800 Cubic Yards $2,000 ÷ $1001addltJonal 10,000 C,Y,$2,200 45,750 Living Area $2.14 /Bq, Ft. of Living Area $97,9055,550 Bldg. Sq. FL.$0.34 /Bldg. Bq.FL $1.8B71 Project $66.010 tProJect $66,0101 Project $90,750 /Project $90.750 $11,078.504 TotalValue 0,75 of TotalVaiue24 months $8,308,878 Totel Loan 0,65 of Total Loan $8,308,878 Total Lean 7.5% of Total Loan/Year $81(},116$8,308,878 TotalLoan 2.0% ef Total Loan $166.178$1.491,550 Total Office Pann, Loan ;I.0% of Office Loan $14,915$12,069,712 Hard & Soft Costs 5% of Hard & Soft Costs $603.486 $3,50~,450 $11,681,989 Hard & Soft Costs (e)12% of Hard & So~ Co~ts (e)$1.401,839 Excavation Fees School Fees Residential Commercial Plan Check Fees Utility Fees _.~.gnstnJction Financtno Costs Loan to Value Rat~o Length of Consth~ctlon Pariod Drawdown Factor Construction Loan Rate Loan Fees Permanent Loan Fees Pro~ect Continc~enc,/ TOTAL SOFT COSTS DEVELOPER PROFW ,REVENUE REVENUES and EXPENSES RESIDENTIAL UNIT SALES Market Price Below Market Rate Unit Pdce (f) Bro~ora~le and Market~n~ Expenses TOTAL RESIDENTIAL REVENUE COMMERCIAL LEASING Monthly Office Laaee Rate (NNN) Monthly Retail Lease Rate (NNN) Less Vacancy Monthly/Operatinc~ Expenses TOTAL COMMERCIAL LEASING REVENUE TOTAL CONSTRUCTION COSTS:’$!,4,.0.75.037 Number Unlt Price Unit Total Prise/Unit 42,000 /Bldg. Sq. Ft.S500 /Bldg, Sq, Ft.$21,000,000 $700.0003,750 /Bldg. Sq. Ft.$196 /Bldg, Sq, Ft.$736.164 $245.3885% of Potential Revenue ($1,086,80~ $20,649,356 $625.738 2.800 Bldg. Sq, FL $3;50 /Bldg Sq. FL 59,8002,750 Bldg. Sq. Ft.S3.25 /Bldg Sq. FI $8,93810% of Potential Revenue ($1,874)5,550 BId~, Sq. Ft.($0.341/sid~l Sq. Ft 151,8731 $14.991 Annual Revenue COMMERCIAL CAPITALtZEDVALUE $179,888 /Year Capitalization Rate Capltalleed Value 8%/Annual Revenue $2,24~,.594 TOTAL PROJECT VALUE ~ LAND RESIDUAL VALUE ""$336,11 /Lot Sq, FL -~. Notas: (a) Assumes 30 units at 1.400 seuare feet and three units at 1.250 seuara feet with wood frame high-quality construction, skylight1 wood floors, and full kitchen appliances, See Appendix S for a full unit detail, (b) Assumes wood frame construction on stucco. Tanants are ground floor restaurant and small office usar. See Apl:)endix S for building detail (c) Assumes 250 square feet per space for tuck under parking and podium parking, and 360 square feet per space for underground parking, (d) See Appendix T for a detail list of p~anning, building, and davelopment impact fees. (e) Financing costs are not included in calculating develooer profit. (f~ The below market rate unit price is based on Santa Clara County’s median income for a four person household according to the Department of Housing and Community Devalopmant, See Appendix U for an explana~on of the BMR home edce, Sources: RS Mean Square Foot Construction Costs, 2002; Ross Construction, 2002: Segue ConsttuclJon: 2002; J.R, Roberts Construction, 2002; Classic Communities. 2002: Dollars and Cents. Multifarniiy Housing, 2002; BAE, 2002. Appendix T: impact Fees and Planning Fees Development Impact Fees Commercial In-Lieu Fee (Housing) Parks Fee Community Center Fee Lib===~.~ Fee Total Fee Commercial Unit Multifamily .Unit$15.00 Isq. ft.Not applicable$3.38 /sq. ft.$5,210 /unit$0.19 Isq. ft.$1,250 /unit$0.18 /sq. ft.$470 /unit$18.75 /sq. ft.$6,930 /unit Below Market Rate Program School Fees Building Fees Electrical Permit Fee Mechanical Permit Fee Plumbing Permit Fee Building Permit Fee Building Demolition Permit Excavating, Grading, and Fill Permits Plan Review Development Project Preliminary Review Regular Negative Declaration Plan Check Fire and Life Safety Plan Check Zoning Plan Check Strong Motion Instrumentation Surcharge Address Changes Architectural Review 5.00% of Appraised Value or 1 BMR unit every 10 units $0.34 /sq. it.$2.14 /sq. ft. Commercial Unit Multifamil~/ Unit$0.06 /sq. ft.$0.06 /sq. ft.$0.06 Isq. it.$0.06 /sq. ft.$0.06 Isq. ft.$0.06 /sq. ft.$5,903 Per Million in valuation plus $3.85 for each additional $1,000 in valuation $100 /Project $100 /Project $1,000 /first 1,000 cubic yards, plus $100 for each additional 1,000 cubic’yards Commercial Unit "Multifamil~/ Unit$3,000 /Project $3,000 /Project$650 /Project $650 /Project75% of Building Permit Fee 75% of Building Permit Fee 45% of Building Permit Fee 45% of Building Permit Fee 25% of Building Permit Fee 25% of Building Permit Fee $21 /$100,000 of valuation $10 15100,000 of valuation$100 Per Change $100 Per Change $1,815 /Project $1,815 /Project Utility Fees Commercial Unit Multifami!~/ " UnitGas Service $3,000 /Project $3,000 /ProjectGas Meter $500 /Meter $200 /MeterDomestic Fire Service Water $6,000 /Project $6,000 /ProjectFire Service 6"$6,000 /Project $6,000 /Project4"Water Meter $3,000 /Meter $3,000 /Meter1" Irrigation Meter $150 /Meter $150 /Meter2 Sewer Laterals $4,500 /Project $4,500 /ProjectRelocation of Utilities $10,000 o$20,000 Small-Large Project $10,000 -$20,000 Small-Large Project Sources: Public Works Department, Planning Department, City of Palo Alto, June 2002; Palo Alto Unified School District; June 2002. Palo Alto Utilities Department, 2002; BAE, 2002. 0 07/31/02 17:27 FAX 415 781 8118 SEDWAY GROUP ~002 July 3 !, 2002 Property Owners SOFA II Pale Alto, CA Attachment K SEDWAY GROUP J Real Estate and Urban Economics 505 Montgomery Slreet Suite 600 San Francisco, CA 94111-2552 T 415781 8900 F 415 781 8118 sedway@sedway.com Re: Draft SOFA Coordinated Area Plan, Phase II Neighborhood-Serving Retail Provisions Dear Property Owners: Sedway Group is pleased to submit this letter report to you summarizing our analysis of the retail component of the City of Pale Alto’s Draft South of Forest Area (SOFA) Coordinated Area Plan, Phase II (hereinafter referred to as SOFA II). At your request, Sedway Group reviewed the portions of the Draft Plan pertaining to the neighborhood-serving retail, service, and restaurant orientation of. ground floor space along Emerson Street and Homer Avenue, as provided in Policy L-3. As we understand, the land use component of the Draft Plan would require all ground floor office space along these two streets within the Plan area to be converted to retail space when vacated by the existing office tenants. In like manner, all existing non-residential properties along these streets could on|y accommodate retail space on the ground floor when developed or redeveloped, such as the existing automotive uses. You are concerned this land use policy, if implemente~d, would result in an oversupply of retail space, which would negatively impact the marketability of the properties along Emerson Street and Homer Avenue as well as the health of Pale Alto’s retail market. Accordingly, you asked Sedway Group to conduct an independent analysis of the Draft Plan’s retail land use policy, assessing the junctu¢e between the prospective supply of new pedestrian-oriented retail along Emerson Street and Homer Avenue and prospective pedestrian-oriented fetal! demand. To conduct this analysis, Sedway Group engaged in several tasks, as follows: Reviewed relevant portions of the SOFA lI Draft Plan; Met with you and Steve Emslie, the Pale Alto Planning Director, to review our scope of services and to identify a pedestrian-oriented retail market areai Conducted field work in SOFA I1 to assess the existing land use pattern; Inventoried the properties on Emerson Street and Homer Avenue; Identified the maximum potential retail space in SOFA II pursuant to the Draft Plan provisions; Analyzed the likely surplus or deficit of off-street retail-oriented parking pursuant to the Draft Plan’s retail land use policy; Conducted field work along University Avenue to review the retail climate; Reviewed and assessed for reasonableness existing University Avenue retail vacancy data compiled by you; Identified a pedestrian-oriented SOFA II retail market area; a CB Richard Ellis Company 07/31102 17:27 FAX 415 781 8118 SEDWA~ SOFA II Property Owners July 30, 2002 Page 2 SEDWAY GROUP [Real Estate and Urban Economics Forecasted demand for pedestrian-oriented retail demand in SOFA II, including existing and projected resident demand, area worker demand, and spin-off demand from University Avenue; and Compared the SOFA II retail supply and demand projections to assess the prospective over- or .under-supply of retail space based upon the Draft Plan provisions. Our summary findings are presented below. These findings are subject to the Assumptions and General Limiting Conditions found at the end of this letter report. All cited exhibits are included in an Appendix. SUMMARY OF FINDINGS Sedway Group’s research findings indicate that if the provisions of the Draft Plan are fully implemented, SOFA II could have a retail inventory comprising approximately 170,000 square feet. This assumes all existing retail space is retained as retail, all ground floor office space is converted to retail, and that all existing automotive sites are redeveloped as retail at a 0.4 FAR. By contrast, Sedway Group’s retail demand analysis for SOFA II’s pedestrian-oriented retail market area - which is larger than SOFA II and bounded by Middlefield Road, Embarcadero Road, Alma Street, and University Avenue - forecasts pedestrian-oriented retail demand for approximately 75,300 square feet. This estimate is based on the following market components: Existing pedestrian-oriented market area residents Projected pedestrian-oriented market area residents Existing pedestrian-oriented market area workers Downtown spin-off demand The net result of our pedestrian-oriented retail supply and demand analysis, summarized in the table below, indicates that SOFA II’s existing supply of approximately 72,500 square feet of retail space is already sufficient to meet the estimated 75,300 square feet of pedestrian-oriented retail demand. The analysis further indicates that the potential supply of retail in SOFA II pursuant to the provisions of the Draft Plan supply would so outstrip pedestrian-oriented demand that SOFA II could have an estimated 94,000-square-foot surplus of retail space, equivalent to 56 percent of all potential retail space. SOFA II Pedestrian-Oriented!;.?. .:.~Retail Supply and Demand AnM~;S!~": ¯ " Markg!Cha tacteristic [Sqiiare:Fe~t .... Retail Supply Existing Retail Space 72,499 Potential Retail Space 96,83 Sub-total 169,330 Retail Demaud Pedestrian-Oriented Retail ]75,304 Retail Surplus/Deficit Oversupply of Ketail Space [94,026 07/31/02 17:27 FAX 415 781 8118 SOFA II Property Owners July 30, 2002 Page 3 SEDWAY GROUP SEDWAY GROUP IReal Estate and Urbart Economi(:s A 94,000-square-foot surplus of retail space in SOFA II would be damaging to the area and to the City of Pato Alto in many ways. Even if Sedway Group’s demand estimate is increased by 50 percent, a substantial surplu~ would still remain. Moreover, if all the existing office space is converted to retail, Sedway Group estimates the retail along just Emerson Street and Homer Avenue would have a deficit of 202 to 27l off-street parking spaces to support these retail uses. This deficit would serve as a deterrent in its own right, both to prospective retailers and to shoppers, as the availability of off-street parking is a joint expectation, regardless of the pedestrian-orientation of a shopping district. A high SOFA lI retail vacancy rate would result in buildings with poor upkeep and unsightly appearances, translating into lower property values, which would reduce Palo Alto’s property tax base. In an effort to boost occupancy, building owners would feel pressured to be less selective about tenants, and more willing to accept less credit-worthy tenants. Such lower-paying tenants would result in a lower quality retail environment, which could repel rather than attract shoppers. A less than savory retail environment in SOFA II could backfire on the adjoining University Avenue shopping district by reducing its base of shoppers. Even if Sedway Group’s dire estimates are not realized, the success of SOFA II could occur at the expense of other existing retail districts in Palo Alto. This could result in the siphoning away of tenants from other existing areas, increasing their retail vacancy rates. At a time when a highly successful and well tenanted shopping district such as University Avenue has a relatively high retail vacancy rate, with at least seven storefronts vacant as of June 2002, this does not seem a prudent policy direction for the City of Palo Alto. In an era where the City of Palo Alto is seeking to preserve retail space, pursuant to other policy directions sought by City staff, it does not seem appropriate to implement a policy designed to increase the City’s retail base, especially in an area with limited inherent strengths as a retail location such as SOFA Therefore, if asked by the City of Palo Alto, Sedway Group would encourage the elimination or substantial restructuring of the Draft Plan’s L-3 policy requiring the transition of ground floor commercial space to retail. As included in the Draft Plan, this policy does not seem to be in the be~t interests of the City of Palo Alto. DETAILED FINDINGS Existing and Prospective Supply of Retail Space Sedway Group’s inventory and analysis of existing and prospective retail space in SOFA II involved the compilation of a parcel-specific database as well as review of a SOFA-West Retail Market Study prepared for the City of Palo Alto by Wallace & Steichen, Inc. in June 2001. The Wallace & Steichen report was useful as a source of the existing retail square footage in SOFA II exclusive of Emerson Street and Homer Avenue. Sedway Group’s existing corra-nercial land use findings for Emerson Street and Homer Avenue are summarized in Exhibit 1, with the detailed parcel findings documented in Exhibits 2 through 5. The detailed findings include information on property address, existing tenant name, building use, zoning designation, number of building stories, building square footage, lot size, actual FAIL and number of off-street parking spaces. Exhibits 2 and 3 present the detailed findings for the north and south sides of Emerson Street, respectively, while Exhibits 4 and 5 present the detailed findings for the east and west sides of Homer Avenue, respectively. 07)3!/02 17:28 FAX 415 781 8118 SEDWAY GROUP SOFA II Property Owtters July 30, 2002 Page 4 S~= DWAY GROUP IReal Estate and Urban Economics The existing commercial land use findings are summarized in the following table, indicating the existing ground floor and total square footage distribution of land uses on Emerson and Homer. ." i; .~-:" ... ¯ " .-:":.: .i :. i . Em~s~i Stree:~~in~iiH0mer A~,~nue. ......:i ::--. ~ :~i-:: ’- :.: :... office 71,286 47%96,739 46% ’Automotive 28,379 19%28,370 14% Warehouse 6,750 4%32,850 16% Total 151,774 I00%208,458 ~ I00% This information indicates that office space comprises the dominant land use along Emerson Street and Homer Avenue, both at the ground floor level and total, with almost 50 percent of the existing square footage. Retail, by contrast, comprises a much smaller percentage, dose to one-third of all ground floor space but only one-fourth of all existing square footage. Office space is still the dominant land use in the area even when SOFA lI’s other existing retail space is added to the Emerson Street and Homer Avenue inventory. This additional space totals an estimated 22,000 square feet according to the Wallace and Steiehen report (see Exhibit 6). Thus SOFA II’s estimated inventory Of existing retail space totals 70,499 square feet, as summarized below. ¯: .:-.~’~isfing..SOFA II-Retail Space . Locatioii ;.: :.-. ::..Sq. Emerson & Homer Retail 50,499 Additional Area Retail 22,000 Total Existing SOFA II Retail 70,499 Implementation of the Draft’ Plan’s L-3 land use policy would shift the balance of development in SOFA II, greatly increasing the area’s retail inventory. As documented in Exhibit 6, if all existing ground floor office space was converted to retail space, and all existing automotive sites were redeveloped with retail, Sedway Group calculates SOFA II’s retail inventory as follows: . . ..:-.:~Potgntial SOFA.H.Retafl,Space".. . ¯ . " ... Maximum:Potential:.i: Emerson & Homer Retail 50,499 Additional Area Retail 22,000 Office 71,28~ Automotive 25,545 Total 169,330 07/31/02 17:28 FAX 415 781 8118 SOFA tI Property Owners July 30, 2002 Page 5 SED~A¥ GRObP ~ uu~ SEOWAY GROUP |Real Estate and Urban Economics Thus SOFA II’s retail inventory would more than double, increasing from an estimated 70,499 square feet to an estimated 169,330 square feet. For a small area such as SOFA II, this would be a significar~t increase in retail inventory. Such a dramatic increase in retail space would require a significant change in market dynamics. This is especially true if the new retail space is created at the expenge of existing office and automotive uses, such that the very daytime population that currently helps ,to support the area’s retail would be reduced in order to accommodate new retailers. Parking Implications Sedway Group conducted a very preliminary analysis of the parking implications of the Draft Plan’s L-3 policy. This analysis assumes area retail development would need to be parked at level required in the Municipal Code, at four off-street parking spaces per 1,000 square foot of building area. Based upon field work identifying the number of off-street parking spaces associated with each parcel (and documented in Exhibits 3 through 8) and an estimate of the number of off-street parking spaces associated with the existing ground floor office spaces, Sedway Group presents the following findings: The existing Emerson Street and Homer Avenue retail properties have an existing deficit of up to 69 off-street parking spaces; The existing ground floor office spaces would have a deficit of 202 parking spaces if converted to retail space absent any site renovation; and It is assumed that any redeveloped automotive sites will be designed to sufficiently accommodate the required parking. Cumulatively, these figures, documented in Exhibit 7, suggest an area deficit of 202 to 271 parking spaces required to support the existing and potential retail uses on Emerson Street and Homer Avenue. While the Draft Plan’s intent is to create a pedestrian-oriented retail environment, minimizing the need for parking, both shoppers and retailers will continue to have an expectation of the availability of parking. While shoppers are often indifferent to the nature of the parking, especially regarding off- street versus street parking, the lack of an adequate supply of parking could be a shopping deterrent. Moreover, it could be very difficult to attract and retain retail tenants in an area with an inadequate supply of parking. Despite local policy goals, retailers will be unwilling to invest in an area without a perceived supply of customer and supplier parking. This suggests that the adaptation of existing office spaces to retail, as provided for in the Draft Plan, would only exacerbate retail vacancy conditions in SOFA Projected Pedestrian-Oriented Retail Demand Sedway Group prepared a demand projection for pedestrian-oriented retail demand. This projection examines four sources of prospective demand, as follows: Existing pedestrian-oriented market area residents; Projected pedestrian-oriented market area residents; Existing pedestrian-oriented market area workers; and Downtown spin-off demand. Highlights of these findings, summarized in Exhibit 8 and documented in Exhibits 9 through 12, follow. The summary in Exhibit 8 indicates supportable demand for approximately 75,300 square feet of pedestrian--oriented SOFA II retail space. A discussion of the components of this demand follows. 07/31/02 17:28 FAX 415 781 8118 SEDWAY GROUP .~uut SOFA II Property Owners July 30, 2002 Page 6 $ I~ DW~I~Y GROUP Estate and Urban Economics Existing Resident-based Pedestrian-oriented Retail Demand. In conjunction with the City of Palo Alto Planning Department, SOFA II’s pedestrian-oriented retail market area was defined as the area bounded by Middlefield Road, Embarcadero Road, Alma Street, and University Avenue. ~According td estimates prepared by Claritas, a national provider of census-based demographic ~stimates and projections, this area includes approximately 4,100 residents. , Using a proprietary retail demand model, Sddway Group estimated the retail spending potential of this population group, taking into consideration income and national retail spending patterns for like income groups. The results, documented in Exhibit 9, indicate this population group has $70 million in retail spending potential. No neighborhood, let alone no city, ever captures 100 percent of its market area resident’s retail spending potential. Thus this $70 million expenditure figure was adjusted to reflect an estimated pedestrian-oriented retail spending capture rate for SOFA II. This adjustment occurred on a retail category by category basis. These adjustments are documented in Exhibit 9, but include the following estimated capture rates for select retail categories: apparel, 5 percent; food stores, 50 percent; eating and drinking places, 10 percent; and auto dealers and auto supplies, 0 percent,j These and the other retail category-specific adjustment factors take into consideration the nature of the shopping category (i.e., comparison or convenience), the range of shopping opportunities available in Palo Alto and neighboring cities, and the characteristics of the types of retail goods sold. The result of Sedway Group’s adjustment process indicates estimated SOFA II retail capture of $7.8 million in retail sales. Based upon estimated sales per square foot figures derived from the Urban Land Institute, this level of sales can annually support an estimated 21,400 square feet of retail spaee~ Thus SOFA II’s existing resident-based population is estimated to have the ability to support this amount of retail space. Projected Resident-based Pedestrian-oriented Retail Demand. According to the City of Palo Alto, the combined SOFA and SOFA II area has the potential for the development of 300 new residential units. At an average of 2.3 persons per household, Palo Alto’s average household size according to Claritas, these 300 new units have the potential to contribute an estimated 690 new residents to the pedestrian.- oriented retail market area. Using the same per capita spending patterns estimated for the existing population, as well as the same SOFA II retail capture rate and sales per square foot figures, these 690 new residents are estimated to annually support approximately 3,600 square feet of SOFA II retail space (see Exhibit 10). Employee-based Pedestrian-oriented Retail Demand. Sedway Group also prepared an estimate of local worker support for pedestrian-oriented retail in SOFA II using the same pedestrian-oriented market area definition as for residents. For this area, American Business Information, a business resource database, estimates a workforee of 10,445. While Sedway Group did not verify this figure for accuracy, it corresponds well with the area’s inventory of office and other commercial space and considered reasonable for the purpose of projecting worker retail demand. Sedway Group’s estimate of employee-based retail demand relies upon findings from a national worker expenditures survey conducted by the International Council of Shopping Centers. This survey focused on daytime and nighttime worker spending in the workplace community. As with the resident- based demand, capture rates and sales per square foot estimates were applied to total estimated worker spending. The results, documented in Exhibit 1 l, indicate that the market area’s workers are estimated to spend $35.3 million annually in Palo Alto, or $3,38l per worker. The overall capture rate estimated for SOFA II (as distinct from other Palo Alto shopping areas such as University Avenue and Stanford ’ Please note these uses are distinct from the area’s existing automotive repair services. 07/31/02 17:29 FAX 415 781 8118 SOFAI[ Property Owners July 30, 2002 Page 7 SEDWAY GROUP ~lOO~ S EDWAY GROUP J~eal Estate and Urban Economics Mall) is 19 percent, resulting in $6.7 million in sales potentially captured by SOFA II retailers. Based upon category-specific sales per square foot estimates, this $6.7 million is estimated to annually support 22,344 square feet of SOFA II retail space. This estimate will of course be reduced proportionally if any area employees are displaced due to conversion of ground floor office space on Emerson Street and Homer Avenue to retail space in accordance with the Draft Plan’s provisions. Downtown Spin-off Demand. Pursuant to the request of the City of Palo Alto, Sedway Group also incorporated a demand component based upon spin-off demand from the highly successful concentration of retail along University Avenue. Our approach to this was to examine and compare existing retail sales capture rates for University Avenue and SOFA IL These results, based upon information provided by the City, indicate that University Avenue and SOFA II historically capture 14 percent and 1.5 percent of Palo Alto retail sales, respectively. With extremely effective marketing, appropriate signage, and the attraction of unique retailers to SOFA II not already represented on University Avenue, it may be possible for SOFA II to increase its share of Palo Alto’s retail capture rate as a result of spin-off demand from University Avenue. Tke extent of this market share increase is difficult to determine, but for analytical purposes Sedway Group assumes it is 0.5 percent, increasing SOFA II’s retail sales, capture rate by one-third, to 2.0 percent. In other words, SOFA II would capture 13 percent of the combined expanded SOFA IIAIniversity Avenue retail sales (i.e., 2.0 percent into 16.0 percent), versus a current 10 percent (i.e., 1.5 percent into 15.5 percent). Sedway Group believes any larger increase in SOFA II’s sales would likely not be realistic given the area’s peripheral, albeit adjacent, location to University Avenue. This is especially the case due to University Avenue’s strong composition of retailers, already satisfying many shopping needs. Based upon an inflation-adjusted estimate of Palo Alto’s retail sales, we estinaate that SOFA II’z maximum potential increase in retail sales is equivalent to $8.4 million (see Exhibit 12). Based upon a conservative $300 per square foot sales estimate, reflective of a range of retailers, this is equivalent to annual support for a maximum of approximately 28,000 square feet. Thus Sedway Group concludes that SOFA II’s spin-off potential from University Avenue is no greater than 28,000 square feet. Cumulative Market Area Pedestrian-Oriented Demand. The cumulative total of the four components of pedestrian-oriented demand for SOFA II retail .space is approximately 75,300 square feet, as summarized in the following table. Existing Residents Projected Residents Area Workers Downtown Spin-off Total 21,402 3,58I 22,344 27,977 75,304 28% 5% 30% 37% 100% 07/31/02 17:29 FAg 415 781 8118 SOFA II Property Owners July 30, 2002 Page 8 SEDWAY GROUP SEDWAY GROUP jReal Estate and Urban Economics This indicates that projected demand is comprised of r, oughly three of the demand segments, existing residents, area workers, and downtown spin-off demand. In contrast, the projected area residents will contribute an almost insignificant amount of support for area retail space. This is important to note given that at one point the Draft Plan indicates that it is expected that "the market for neighborhood local retail and service uses will improve with the private redevelopment facilitated by the Plan due to increased number of residents and employees in the area.’a Not only will the future residents support an insignificant amount of retail space, but it is unclear to Sedway Group what future employees this Draft Plan statement involves since the Draft Plan’s primary land use provision is for the displacement of office workers with retail workers. Since office workers typically occupy space at a higher density level than retail workers, the end result may be a reduction rather than an increase in area workers. Please note that Sedway Group did not take this potential workforcr reduction into account in the area workers retail projection, thus resulting in a potential overestimate of supportable retail. However, the results of this correction are not estimated to be material to the analysis. Supply and Demand Implications The results of Sedway Group’s estimated supply and demand analysis for SOFA II retail space are documented in Exhibit 13 and summarized below. These results indicate that SOFA II’s existing supply of approximately 72,500 square feet of retail space is already sufficient to meet the estimated 75,300 square feet of pedestrian-oriented retail demand. The analysis further indicates that if the provisions of the Draft Plan are fully implemented, retail supply would so outstrip demand that SOFA II could have an estimated 94,000-square-foot surplus of retail space, equivalent to 56 percent of all potential retail space. Even if Sedway Group’s retail demand projections are aggressively increased by, say, 50 percent, which we believe to be highly unlikely due to factors such as the loss of office workers from the conversion of office space, the area could still have an oversupply of space equivalent to 33 percent of all space, a most unhealthy retail vacancy rate. SOFA II PedeStrian-Oriented ¯ . iRef!ii! ~.S_.upp!~La. :~d.~Demandi!Analysis MarketCharacteriSf!~:i ..... -SquareF~et-::" Retail Supply Existing Retail Space Potential Retail Space Sub-total Retail Demm~d Pedestrian-Oriented Retail Retail Surplus/Deficit Oversupply of Retail Space 72,499 96,83I 169,330 I m 75,304 94,026 A 94,000-square-foot surplus of retail space in SOFA II would be damaging to the area and to the City of Palo Alto in many ways. A high area vacancy rate would result in buildings with poor upkeep and unsightly appearances, translating into lower property values, which would reduce Palo .Alto’s property tax base. In an effort to boost occupancy, building owners would feel pressured to be less South of Forest Area, Draft Coordinated Area Plan, Phase I1, page 5. 07/31/02 17:29 FAX 415 781 8118 SEDWA¥ GROUP SOFA II Property Owners July 30, 2002 Page9 SEDWA¥ GROUP R~Reeal Estate and Urban Economics selective about tenants, and more willing to accept less credit-worthy tenants. Such lower-paying tenants would result in a lower quality retail environment, which could repel rather than attract shoppers. A less than savory retail environment in SOFA II could backfire on the adjoining University Avenue shopping district by reducing its base of shoppers. Even if Sedway Group’s dire estimates are not realized, the success of SOFA II could occur at the expense of other existing retail districts in Palo Alto. This could result in the siphoning away of tenants from other existing areas, increasing their retail vacancy rates. At a time when a highly successful and well tenanted shopping district such as University Avenue has a relatively high retail vacancy rate, with at least seven storefronts vacant as of June 2002,3 this does not seem a prudent policy direction for the City of Palo Alto. In an era where the City of Palo Alto is seeking to preserve retail space, pursuant to other policy directions sought by City staff, it does not seem appropriate to implement a policy designed to increase the City’s retail base, especially in an area with limited inherent strengths as a retail location such as SOFA II. Therefore, if asked by the City of Palo Alto, Sedway Group would encourage the elimination or substantial restructuring of the Draft Plan’s L-3 policy requiring the transition of ground floor commercial space to retail. As included in the Draft Plan, this policy does not seem to be in the best interests of the City of Palo Alto. Sedway Group was very pleased to conduet this analysis of the retail implications of the Draft SOFA II Plan. Please let us know if you have any questions regarding our letter report and the supporting documentation. Sincerely, Amy L. fterman, AICP Managing Dir~tor ALH:skw Enclosure Based upon Sedway Group field research conducted in June 2002. 07/31/02 17:29 FAX 415 781 8118 SEDWAY GROUP ~011 SE:DWAY G,ROUP ~Real Estate and Urban Economics ASSUMPTIONS AND GENERAL LIMITING CONDITIONS Sedway Group has made extensive efforts to confirm the accuracy and timeliness of the information contained in this study. Such information was compiled from a variety of sources, including interviews with government officials, review of City and County documents, and other third parties deemed to be reliable. Although Sedway Group believes all information in this study is correct, it does not warrant the accuracy of such information and assumes no responsibility for inaccuracies in the information by third parties. We have no responsibility to update this report for events and circumstances occurring after the date of this report. Further, no guarantee is made as to the possible effect on development of present or future federal, state or local legislation, including any regarding environmental or ecological matters. The accompanying projections and analyses are based on estimates and assumptions developed in connection with the study. In turn, these assumptions, and their relation to the projections, were developed using currently available economic data and other relevant information. It is the nature of forecasting, however, that some assumptions may not materialize, and unanticipated .events and oireumstanees may occur. Therefore, actual results achieved during the projection period will likely vary from the projections, and some of the variations may be material to the conclusions of the analysis. Contractual obligations do not include access to or ownership transfer of any electronic data. processing files, programs or models completed directly for or as by-products of this research effort; unless explicitly so agreed as part of the contract. This report may not be used for any purpose other than that for which it is prepared. Neither all nor any part of the contents of this study shall be disseminated to the public through publication advertising media, public relations, news media, sales media, or any other public means of communication without prior written consent and approval of Sedway Group. 07/31/02 17:29 FAX 415 781 8118 SEDWAY GROUP ~012 S!E DWAY G.ROU P R~I Estate and Urban Economics APPENDIX 07/31/02 17:30 FAX 415 781 8118 SEDWAY GROUP ~013 ~Real Estate and Urban Economics EXHIBIT I EXISTING COMMERCIAL LAND USE SQUARE FOOTAGE EMERSON STREET AND HOMER AVENUE (1) PALe ALTO, CALIFORNIA JUNE 2002 Current Laud Use (2)Ground Floor Total " ..:Location Square Feet Square Feet Retail North Side of Emerson 6,534 6,534 South Side of Emerson 4,078 4,678 East Side of Homer 4,540 9,080 West Side of Homer 30,207 30,207 Total 45,359 50,499 Ot~ce North Side of Emerson 37,213 60,388 South Side of Emerson (3)9,250 10,250 East Side of Homer 18,823 20,10 i West Side of Homer 6,000 6,000 Total 71,286 96,739 Automotive North Side of Emerson 840 840 South Side of Emerson 9,339 9,339 East Side of Homer 9,800 9,800 West Side of Homer 8,400 8,400 Total 28,379 28,379 Warehouse North Side of Emerson 0 0 South Side o[Emerson 0 0 East Side of Homer 5,250 5,250 West Side of Homer 1,500 27,600 TotaI 6,750 32,850 (1) 700 to 999 Emerson Street and 100 to 249 Homer Avenue. (2) See Exhibits 2 through 5 for detailed inventory. (3) An additional 4,076 square feet of office space is located on the ground floor era 5-story residentia[ building on the southwest corner of Forrest Avenue and Emerson Street. Sources: First American Real Estate Solutions; and Sedway Group, l:\word_pmcessing\word_docs\projects\! 7302X[Future Retail.xls]Existing[MB 30-Jul-02 07/31/02 17:30 FAX 415 781 8118 SEDWAY GROUP 0 ¯ ~" 00o ~ ~’~ ~ 0~oo 0000000 07/31/02 17:30 FAX 415 781 8118 SEDWAY GROUP 07/31/02 17:30 FAX 415 781 8118 SEDWAY GROUP 0 <.000 ~ 07/31/02 17:30 FA~ 415 781 8118 SED~AY GROUP 07/31/02 17:31 FAX 41S 781 8118 SEDWAY GROUP 0 07/31/02 17:31 FAX 415 781 8118 SEDWA¥ GROUP D 0 0 ~ ~0 0 0 07/31/02 17:31 FAX 415 781 8118 SEDWAY GROUP D O0 0000000000 07/31/02 17:32 FAX 415 781 8118 SEDWAY GROUP ~0~ SEDWAY GROUP I Real Estate and Urban Economics EXHIBIT 6 POTENTIAL FUTURE RETAIL (I) SOFA I1 I’ALO ALTO, CALIFORNIA JUNE 2002 Existing or Developable Current Land Use Potential Retail Lot Size Retail Location Space (Sq. Ft.)(Sq. Ft,)FAR (Sq. Ft.) R~tail (2) North Side of Em=rson 6,534 NA NA NA South Side of Emerson 4,678 NA NA NA East Side of Homer 9,080 NA NA NA Wc~t Side of Homer 30,207 NA NA NA Total 50,499 NA NA NA O~ice (3) North Side of Emerson 37,213 NA NA NA South Side of Emerson (4)9,250 NA NA NA East Side of Homer ! 8,823 NA NA NA West Side of Homer 6,000 NA HA NA Total 71,286 NA NA NA Automotive (5) North Side of Emerson NA 2,614 0.4 1.045 South Side of Emerson NA 29,750 0.4 I 1,900 East Side or’Homer NA 10,500 0.4 4,200 West Side of Homer NA 2 t,O00 0.4 8.400 Total NA 63,864 0.4 25,545 Potential and Existing Retail Square Footage (Homer and Emerson):147,330 Existing or Developable Current Land Use Potential Retail Lot Size Retail Location Space (Sq, F~)(Sq. Ft.)FAR ~Sq. Ft.) Peach 6,000 NA NA NA Watercourse Way 6,000 NA NA NA Peninsula Creamery Snack Shop 1,000 NA NA NA Polo Alto Hardware 9,000 HA NA NA Total 22,000 NA NA NA Total Potential and Existing Retail Square Footage (SOFA I1 Area):169,330 (I) Includes the retail potential or" 700 to 999 Emerson Street and 100 lo 249 Homer Avenue a.s well as other existing area retail space. (2) Inclades all existing retail space. See. Exhibit I. O) Includes all ground floor office spac that would transition to retail pursuant to the DraR SOFA [1 Plan. (4) An additional 4,076 square feet ofo~ce space is located on the ~roond floor of a 5-story residential building on the southwest comer of Forrest Avenue and Emerson Street. (5) This development potcntial is calctdated based upon site size and the anticipated retail FAIL It a..’~umes all existing automotive sites would be redeveluped as retail. Sources: Fit~t American Real F.slam Solutions; Wallace & Steichen, lnc~; and Sedway Group. J:\word_pmec~singXword_docs~rojects\17302~[Futere Retaii.xls] Future[MB H]30-Jul-O2 07/31/02 17:32 FAX 415 781 8118 SEDWAY GROUP ~o~3 SEDWAY GROUP I Real Estate and Urban Economics EXHIBIT 7 SOFA II OFF-STREET PARKING REQUIREMENT POTENTIAL RETAIL SPACE PALO ALTO, CALIFORNIA JULY 2002 Current Land Use Retail Off-Street Retail Existing Parking Surplus/ Spaces Requirement (1)(Deficit) Retail 133 133 - 202 (2)0 - (69) Ground Floor Office (3)83 285 (202) Automotive (4)HA NA HA Total 216 418 - 487 (202) - (271) (1) In accordance with Chapter 18.83 of the Municipal Code, City of Palo Alto, fllere are required to be four off-street parking spaces per 1,000 square feet of building use. (2) Range represents current spaces gmndfathered at the low end and required spaces per the Municipal Code at the high end. (3) Existing spaces are assigned to the current ground floor olTtce space in proportion to the total building area. (4) No surplus or deficit is estimated because it is assumed these sites will be redeveloped and parked per the Municipal Code. Sources: City of Palo Alto Municipal Code; and Sedway Group. J:\word..processing\word_does\projects\ 17302\Parking.xls[MBH]30-Jul-02 07/31/02 17:32 FAX 415 781 8118 SEDWAY GROUP 07/31/02 17:32 FAX 415 781 8118 SEDWAY GROUP 07/~1/02 17:32 FA~ 415 781 8118 SEDWAY GROUP (~026 07/31/02 17:33 FAX 415 781 8118 SEDWAY GROUP 07/31/02 17:33 F/L~ 415 781 8118 SB])WAY GROUP 07/31/02 17:33 FAX 415 781 8118 SEDWAY GROUP ~029 SEDWAY GROUP Rl~eaeal Estate and Urban Economics EXHIBIT 13 SOFA II RETAIL SUPPLY AND DEMAND ANALYSIS PALO ALTO, CALIFORNIA .l~ark~t .Characteristic Existing Retail Space (1) Potential New Retail Space (I) Sub-total Square Feet . 72,499 96,831 169,330 Demand Sidg Supportable Pedestrian-Oriented Retail (2)75,304 ~plus/Defid~ Oversupply of Retail Space 94,026 Notes: (1) See Exhibit 6. (2) See Exhibit 8. Source: Sedway Group. J:\word_proeessing\word_docs\projects\ 17302\[S&DAnalysis.xls] S 30-Jul-02 Attachment L April 22, 2002 To; From: SOFA Colleagues and Interested Parties Steve Pierce SOFA II Plan I have been aboard this drifting ship we call the SOFA II Working Group for years, and although we hear, "Land ho," from my viewpoint, we have not reached the port for which we set sail. In short, the SOFA II Plan should not be adopted as written. I have analyzed it in detail and have concluded that the vision is good, but the implementation is not. The goals of the plan will not be met. There are three fundamental problems. 1.The plan is not economically feasible. Landowners will not implement this plan, and thus, it does not meet the City Council directive. 2. The development standards are highly flawed. They will not shape development; they will discourage the very type of development desired. 3.There is little land left to be developed, and the plan does not offer sufficient incentives to direct the development of that land, let alone the redevelopment of that which is already developed. The attached paper seeks to support these conclusions. Unfortunately, this plan is not good for anybody. City leaders should not expend their resources on, or endorse, a plan that will not work, This plan does not serve the people who want to see its vision realized, nor does this plan serve landowners who will be adversely affected by its provisions. At this juncture, I offer three alternatives. 1. Scrap the plan and walk away. 2. Adopt those portions of the plan that will provide guidelines for what little development may occur in the future. 3.Have staff revise the plan. It needs to be bold and based on economic fundamentals. ANALYSIS OF SOFA II PLAN Presented to SOFA II Working Group (April 9, 2002) CONTENTS: A. INTRODUCTION B. ANALYSIS OF LAND ECONOMICS: Case Study - Bill Young Building (940 High Street) C. ANALYSIS OF DEVELOPMENT STANDARDS D. ANALYSIS OF DEVELOPMENT POTENTIAL E. CONCLUSIONS F. RECOMMENDED ALTERNATIVES A. INTRODUCTION Vision of SOFA: Land Use Goals a. Enhance neighborhood-serving character of retail and service uses b. Increase housing opportunities c. Support a mix of uses, including housing, retail, and small offices Purpose of Analysis .a. Demonstrate why proposed plan will not meet goals b. Suggest alternative actions and how goals can be met of balance Constraints/Facilitators to Redevelopment a. Constraints/Facilitators ¯Floor area ratio (FAR) ¯Density: Dwelling units (du)/acre o Development standards (e.g., setbacks, allowed uses) .Parking ¯Land economics b. To be realistic, a plan must strike a balance among the various constraints/facilitators development. ¯ Example: Development standards (e.g., setbacks and parking) appropriate for one size lot may be overly restrictive for a smaller or narrower lot. °Example: Rents may be too low to support development allowed by zoning. Example: An FAR may not be achievable given height and setback standards. Development standards need to be flexible (e,g., performance criteria) to foster and, therefore, fewer impediments to meeting the intended zoning. B. ANALYSIS OF LAND ECONOMICS: Case Study - Bill Young Building of (940 High Street) Why Bill Young? a. Underutilized property with redevelopment potential b. Lot large enough (barely) for underground parking c. Characteristics ¯Existing building FAR 44% -Lot: 7875 sf o Lot width: 75 ft. Assumptions a. Commercial construction costs (hard costs, i.e., "bricks and mortar") ¯$100/sfrehab ¯$250/sfnew b. Residential construction costs (hard costs) ¯ $175/sf new c. Parking costs (hard costs) o $20/sf surface o $100/sfunderground d. Soft costs (e.g., architecture, financing, city fees, insurance, etc.) @ 20% e. Office rents o Downtown: $2.50 to $4.50/sf o SOFA: $3.50/sf °Value: 8% capitalization rate f. Condo sale prices o Downtown: $350/sfto $500/sf(avg. $424/sfbased on most recent 16 sales) o SOFA: $400/sfto $450/sf (Lower end of range most likely due to characteristics adjacent uses) g. Overview: ° Proformas are conservative Costs underestimated, not included: development fees, guest parking, etc. Income overstated, not reduced by: cost to sell units (5% to 7%), leasing expenses, "cost" of BMR, etc. ° Assumptions could be refined, but not needed, would not alter results o Results a. Description of scenarios (Summary, Exhibit A) ¯Scenario 1: Refurbish existing building (Exhibit B) Fix-up and rent out for commercial use Surface parking Value (if sold): $1.SM Solved backwards for land value, based on 10% profit Annual cash flow (if not sold): $143k ¯Scenario 2: Build new residential (FAR @ 0.75) (Exhibit C) FAR per Working Group recommendations Surface parking Sell 5 condos Average unit size: 945 sf (large 1 bedroom) Lose ($282k)to ($518k) Scenario 3: Build new residential (FAR @ 1.50) (Exhibit D) FAR per staff recommendation in Alma and High corridor with Planned Community (PC) zoning -Sell 7 condos -Underground parking, thus costs increase -Average unit size:; -- 1350 sf(large 2 bedroom) -- Larger unit size than Scenario 2 due to recommended density (40 du/acre) Make $84kto lose ($388k) o Scenario 4: Build new mixed use (Com. FAR @ 0.40; Res. FAR @0.75) (Exhibit C) -FAR per Working Group recommendation -Underground parking -Sell 5 condos and commercial space -Lose ($388k) to ($624k) o Scenario 5: Build new mixed use (Com. FAR @ 0.40; Res. FAR @ 1.10) (Exhibit F) -FAR per staff recommendation in Alma and High corridors with PC -Underground parking -Sell 7 condos and commercial space -Lose ($69k) tomake $341k ¯Scenario 6: Build new residential (FAR @ 3.0) (Exhibit G) -FAR for demonstration only (FAR @ Alma Place = 3.9) -Physically not feasible on site this small -Sel118 condos -Density @ 100 du/acre Average unit size: 1050 sf Lose ($13k) to make $932k Conclusions a. Refurbish (Scenario 1) best alternative , Least risk ¯Best return b. SOFA Scenarios 2 to 5 ¯High cost ¯Higher risk ¯Lose money or ~ake inadequate return (Most lenders require a 20% profit to finance proj cots.) ° Proposed FARs are insufficient to generate production of housing c 3.0 FAR (Scenario 6) ¯Higher cost and risk , Greatest potential among Scenarios 2 through 6 for financial return ¯ Maximum estimated return (12%) still inadequate,to finance project d. Other ¯A sane property owner will only refurbish (Scenario 1) ¯Feasibility increases with FAR ¯Higher FAR’s will be more profitable on larger parcels due to economies of scale, especially parking 917 Market has verified results of analysis , Proposed FAR’s (Com. @ 0.40; Res. @ 0.75) not significantly different than existing CD-S FARs, which allows residential and mixed use (Com. @ 0.40; Res. @ 0.60) ¯Over past two decades, no residential or mixed use projects built or proposed without a PC or Transfer of Development Rights (TDR) , Under present zoning, property owners have opted to refurbish (e,.g., 849 High; Alma; 955 Alma; 999 Alma,...) o Alma Place and Ross (800 High Street) proposal demonstrate financial viability of higher FARs. C. ANALYSIS OF DEVELOPMENT STANDARDS Office FAR (Refer to Exhibit H) a. Existing zoning: FAR @ 0.40 to maximum of 5000 sf/parcel b. Proposed zoning: FAR @ 0.25 to maximum of 5000 sf/parcel (SOFA Plan, Section 5.3d) c. Effect of change ¯Of 0.40 commercial FAR, 0.15 must be non-office (i.e., retail and related services) locations. there viable. SOFA II does not have critical mass to attract retail, especially in scattered ¯Landowners will not create space that cannot be rented. ¯Will create hardships; for example: -Bill Young rehabs existing building -43% of building (1483 sf: 0.19 FAR of existing 0.44 FAR) must be retail -Small retail in remote location is not viable Conclusion ¯This change will not bring about the desired effect of creating retail space ° This change will reduce the amount of office space, the use that typically subsidizes other less economically attractive uses (e.g., residential and retail) ¯If landowners create less commercial space (25% FAR rather than 40% FAR), will be less space available for conversion to retail should (when) it becomes (Some retail rents are currently competitive with office.) Office location restrictions a. Existing zoning: No locational restrictions b. Proposed zoning (5.3d): Plan Maximum 2500 sfon 1st floor Not allowed on first floor on Homer and Emerson °Working Group change: Office not allowed on first floor south of Homer o Staff recommendation: Allowed on 1 st floor south of Homer with store front design Maximum 2500 sf on 1 st floor c. Effect of change ¯Requires retail in areas where it will not survive Not all of Homer or Emerson are good retail locations 4 if Example: -- Ole’s is on fringe and is a poor retail location -- Most of Emerson south of Homer is not suitable for retail o Requires retail in building not suited for retail If building not suitable, replacement is likely, contrary to regulation 5.14(d)(2) of Plan Example: Ole’s building o Restricting office to second floor will create hardship for landowners wanting to rehab. Example: Bill Young’s one story building would have few, if any, viable uses rehabed. ¯ Requiring that some, or all of office be on second floor creates problems for multistory structures. Mixed use structure~ would then have commercial and residential spaces on both floors. Design issues are significant: -- Residential has special requirements: private open space; privacy; noise attenuation; etc. -- Commercial and residential have different building code requirements. Mixed use is best separated by floors. (Preferred design is commercial on first floor and residential above.) Conclusion ¯This change will not bring about the desired effect of creating retail space. ¯There will be numerous unintended hardships on landowners. o Inordinate amounts of staff time will be required to administrate and to deal with exceptions and hardships. o Seismic Bonus a. Existing zoning: o Floor area bonus (the greater of 2500 sf or 25% of building floor area) is available to selected unsafe structures if seismically upgraded. °Bonus may be used for any use allowed in zone. ¯Bonus may be transferred to another building (transfer.development rights: TDR). b. Proposed zoning (5.2k) ° Bonus can only be used to create residential units. o Bonus can only be used on-site (no TDR). c. Effect of change ¯ This diminishes incentive for seismic retrofitting and could decrease pace and number of buildings upgraded. ° Some buildings may be unsuitable for residential, thus making the bonus worthless. d.Conclusion o Reason for diminishing incentive to upgrade is unclear ¯ Reducing incentives for dealing with a significant health and safety issue is not prudent. o This code change is unlikely to cause additional housing units to be built. 4. Historic Bonus and TDR 5 a.Existing zoning: Same as seismic bonus; available for rehabilitation of selected historic structures b. Proposed zoning: ¯ Bonus is 25% of gross floor area if bonus used for retail or residential. (The greater of 25% or 2,500 sf is elim~ated.)i . Bonus is 10% of gross floor area, if bonus used for office. c.Effect of change ¯Given the size of the historic structures in the SOFA area, the bonus is equivalent to one or two residential units. o This change diminishes incentive to rehabilitate rather than demolish historic structures. d. Conclusion ¯ Structures that have Palo Alto historic classifications that make them eligible for the bonus are also subject to restrictions on demolition and standards for rehabilitation (Secretary of Interior Standards). o The Dames and Moore study identified many eligible structures that do not have Palo Alto historic classifications. These structures are more vulnerable to unregulated modification and demolition. Therefore, incentives to encourage owners to voluntarily seek a Palo Alto historic classification are appropriate. ¯The proposed zone change could reduce the amount and degree of preservation. ¯Due to the small size of the bonus and the expense of small scale mixed use, few, if any, residential units will .be created by this change. o average . average Residential densities (5.3b) Existing zoning: 16 to 30 du/acre Proposed zoning: 30 to 40 du/acre depending on type of project and location Conclusions o Density standards should be eliminated in SOFA II area with any future zoning -Concern is bulk of buildings (FAR) -Concern is not number of units and traffic generated (du/acre) because of proximity to transportation center. Developer has incentive to create as many units as feasible, therefore, density standards are not needed. ¯The FAR and density standards of the proposed zoning are not in sync, and unit size are skewed inappropriately (e.g., compare Scenario 3, Exhibit D, unit size 945 sf, to Scenario 4, Exhibit E, average unit size 1350 sf). Alto size). Maximum unit size a. Existing zoning: no maximum b.. Proposed zoning: 1500 sfmaximum c. Effects of change ¯Eliminates larger family units ¯Eliminates shared housing, the most prevalent default low cost housing in Palo Conclusion o If the goal is to eliminate large luxurious condos, there are better ways to do it a cap on average unit size or a limit on the percent of units over a particular and Why prohibit all large or luxury condos, as they can help to subsidize the BMR smaller units? The 1500 sf unit should be eliminated. not Setbacks for residential only projects a. Existing zoning: Setbacks required per RM-30 zone b. Proposed zoning: Revised setbacks (Note: No setbacks for commercial and mixed use projects.) c. Conclusion o Setbacks create problems on small lots. ¯Setbacks create problems with refurbished building (Example: Bill Young could meet setback standards if converted to residential).. o Setbacks will occur regardless due to requirements for open space and of Uniform Building Code. What is achieved by requiring a residential use in a commercial area to adhere to different standards than adjacent uses? ¯Setbacks should be eliminated. (Code revision will result in change in setbacks for mixed use under existing zoning) Special .provisions and other standards a. Eliminate standards that over specify and reduce flexibility to comply with intent b. Examples: o Exact size of landscape pockets (5.3j) ¯First floor residential required to be above grade (5.14h) will parcels d. Planned community (PC) a. Existing zoning: PCs allowed as elsewhere in city b. Proposed zoning: There was much discussion about prohibiting PCs in SOFA II. The fear of many is that the Planning Commission and City Cotmcil will allow what, in their judgment, are large inappropriate projects. c. Effect of change o Without the PC, there is no chance that a significant number of residential units be built. ° Without the PC, the opportunity to achieve the vision on the few remaining will be lost. Conclusion ¯ SOFA II is the perfect place for the PC because of: -The variety of land uses, building types, lot sizes (i.e., lack of homogeneity) -The unique locational attributes of the area: near transportation center and between downtown and residential districts ¯SOFA II is the perfect place for the PC because of: The need to think "outside the box" to meet SOFA II and Comprehensive Plan goals o The PC should be maintained as it is under the present code. 10.Conclusions: The development standards are flawed a. Will not generate the land uses desired b. Will result in unintended hardships c. Are complex and will be cumbersome to administrate d. Will reduce incentives for seismic upgrades and historic preservation D. ANALYSIS OF DEVELOPMENT POTENTIAL permitted Alma, There is limited potential for development in SOFA II. Most sites are already developed or have development restrictions (Refer to Exhibit I). a. Historic structures will not be replaced of converted to residential. b. Highly developed properties will not be redeveloped (e.g., former Sports Clinic Bldg., former Ellison’s garage, condos on Ramona, Keenan Bldg.). Many highly developed buildings have. FARs in excess of what is and will be and therefore, are even less likely to be altered (e.g., 917 Alma, 955 Alma, 999 700 High, Whole Foods). d. " Small properties c .armot redevelop to FARs exceeding 0.40-to 0.45 because they are physically too small for underground parking. E. CONCLUSIONS The Plan FARs are not high enough to make redevelopment feasible. a. There will be few, if any, new residential units. b. Redevelopment will be, as in the past, fix-up and convert use of existing structures. 2. There are few sites available for redevelopment. Fo 3.Plan will result in stares quo. 4.Plan development standards are complex and flawed and will create problems. a. Some provisions will hamper redevelopment, even of the type desired. b. Existing zoning is less flawed. 5. If want more housing and a critical mass of retail, the plan needs to be bold. RECOMMENDED ALTERNATIVES Alternative A: Do not adopt SOFA II Plan a. Scrap the SOFA II plan entirely b. Allow redevelopment to proceed under existing zoning with PCs bringing in the type and quantity of uses desired. c. Allow zoning update to clean-up problems with existing zoning Alternative B: Adopt a modified plan as a guideline only a. , Adopt portions of Chapter 2 (Vision), Chapter 3 (Policies), and Chapter 4 (Design Opportunities) as follows: ¯ As guidelines for future development, not_ as a coordinated area plan o Expunge all quantitative standards and couch as guidelines b. Do not adopt Chapter 5 (Development Standards) and Chapter 6 (Implementation). c. Allow redevelopment to proceed under existing zoning, including PC’s. o Alternative C: Revise plan a. Return plan to staff to devise a realistic method to achieve vision ¯Conduct economic feasibility studies to support FARs and other plan features °Devise development standards that are easily understood and do not micro manage b. that II Consider: Incentives (e.g., FARs) that will cause landowners to use or create large parcels will accommodate land uses desired ¯Incentives (e.g., FARs) for land uses desired -Largest incentive for rental housing -Incentive for residential (for sale condos) and retail ¯ Incentives to redevelop Block 5, which includes Whole Foods parking lot as follows: Large retail component, to create critical mass needed to foster retail in SOFA (Whole Foods is a natural anchor tenant) Limited office component : Large residential component Parking for Whole Foods and the above uses 9 Scenario: Commercial FAR Residential FAR COSTS: Commercial Residential Parking Total Hard Costs Soft Costs Land Total VALUE: Commercial Residential Total ~GAIN/(LOSS): Exhibit A Bill Young Building: 940 High Street Alternative Development Scenarios. 1 I 2 Refurbish Working Existing Group Building Res. Only 0.44 0.75 ($ooo) 3 4 Staff Working Option Group ’ Res. Only [Mixed Use J 0.40 1.50 I 0.75 Staff Option Mixed Use 0.40 1.10 6 High FAR Res. Only 3.00 $345 $788 $788 $1,034 $2,067 1,034 1,516 $4,134 98 56 490 735 945 1,260 443 .1,090 2,557 2,557 3,249 5,394 .87 218 511 511 650 1,079 1,100"1,100 1,100 1,100 1,100 1,100 (1,630)(2,408)(4,168)(4,178)(4,999)(7,573) 1,890/2,126 3,780/4,2521 (388)/(84) 1,654 1,654 1,890/2,126 3,270/3,686 3,544/3,980 4,930/5,340 (624)/(388) (69)/341 1,811 181 (518)/(282) * Derived, based on 10% redevelopment profit Prepared by: Steven R.’ Pierce 7,589/8,505 (13)/932 Exhibit B Scenario 1: Refurbish Existing Building . COSTS Commercial Area (Existing bldg. @ FAR 0.44) Cost (@ $100/sf) Residential (N/A) Area Cost Dwelling Units Area/du Parking Commerical (4/1000 sf) Residential Total Area (350 sf/space incld, circ.) Cost (Surface @ $20/sf) Total Hard Costs. 3,450 sf 345 4 spaces 0 spaces 4 spaces 4,900 sf Soft Costs (@ 20%) Land (deduced from bldg. val. below w/10% profi~ 1100 Total 98 443 87 530 VALUE ¯ Commercial (Rent @ $3.50/sf; Cap @ 8%) Residential . Total GAIN OR (LOSS) (1,630) 181~1 181 Exhibit C Scenario 2: Build New, All Residential (FAR @ 0.75) COSTS Commercial (N/A) Area Cost Residential Area (@ FAR 0.75) Cost (@ $175/sf) Dwelling Units (@ 30 du/ac.) Area!du (@ 80% yield) Parking Commerica! Residential (@ 1.5/spc/du) Total Area (@ 350 sf/space incld, circ.) Cost (Surface @ $20/sf) Total Hard Costs Soft Costs (@ 20%) Land (Per Scenario 1) Total VALUE Commercial Residential (@ $400 to $450/sf) ]Tota! GAIN OR (LOSS) 5,906 sf 5 du 945 sf 0 spaces 8 spaces 8 spaces 2,800 sf ($000) $1,034 56 1,090 218 !,308 1,100 (2,403) 0 1,890/2,126 (518)1(282) Exhibit D Scenario 3: Build New, All Residential (FAR @ 1.5) COSTS Commercial (N/A) Area Cost Residential Area (@ FAR 1.5) Cost (@ $175/sf) Dwelling Units (@ 40 du/ac.) Area!DU (@ 80% yield) Parking Commerical Residential (@ 2 spc/2 BR) Total ~Area (@ 350 sf/space incld, circ.) Cost (Underground @ $100/sf) Total Hard Costs Soft Costs (@ 20%) Land (per Scenario 1) Total VALUE Commercial Residential (@ $400 to $450/sf) Total GAIN OR (LOSS) 11,812 sf 7du 1,350 0 spaces 14 spaces 14 spaces 4,900 ($ooo) $2,067 490 2,557 511 I 1,100 (4,168) 3,780/4,252 (388)/84 Exhibit E [ Scenario 4: Mixed Use, Com.(FAR @ 0.40)/Res. (FAR @ 0.75) COSTS Commercial Area (@ FAR 0.40) Cost (@ $250/SF) Residential Area (@ FAR 0.75) Cost (@ $175/sf) Dwelling Units (@ 30 du/ac.) Area/du (@ 80% yield) Parking Commerical Residential (@ 1.5 spc/du) Total Area (@ 350 sf/space incld, circ.) Cost (Underground @ $100/sf) Total Hard Costs Soft Costs (@ 20%) Land (Per Scenario 1) Total VALUE Commercial (Rent @ $3.50/sf; Cap. @ 8%) ’Residential (@ $400 to $450/sf) Total GAIN OR (LOSS) 3,150 sf 5,906 sf 5 du 945 sf 13 spaces 8 spaces 21 spaces 7,350 sf ($ooo) $788 1,034 735 2,557 511 1,100 (4,168) 11654 1,890/2,126 3,544/3,980 624)/(388) COSTS Commercial Area (@ FAR 0.40) Cost (@ $250/sf) Residential Area (@ FAR 1.1) Cost (@ $175/sf) Dwelling Units (@ 40 du/ac.) Area/du Parking Commerical Residential (@ 2 spc/du) ITotal Area (@ 350 sf/space incld, circ.) Cost (Underground @ $100/sf) Total Hard Costs Soft Costs (@ 20%) Land (Per Scenario 1) Total VALUE Commercial Residential (@ $400 to$450/sf) 1Total GAIN OR (LOSS) Exhibit. F Scenario 5: Mixed Use, Com. (FAR @ 0.40)/Res. (FAR @ 1.10) ($ooo) 3,150 sf 8,662 sf 7 du 1,237 sf 13 spaces 14 spaces 27 spaces 9,450 sf $788 1,516 945 3,249 650 1,100 (4,999) ~ 1,6542,276/3,686 4,930/5,340 (69)/(341) Exhibit G Scenario 6: Build New, All Residential (@ FAR 3.0) COSTS Commercial (N/A) Area Cost Residential Area (@ FAiR 3.0) Cost (@ $175/sf) Dwelling units (@ 100 du/ac.) AreaJdu (@ 80% yield) Parking Commerical Residential (@ 2 spc/2 BR) Total Area (@ 350 sf/spc w/circ.) Cost (Underground @ $100/sf) Total Hard Costs Soft Costs (@ 20%) Land (Per Scenario 1) Total VALUE Commercial Residential (@ $400 to $450/sf) Total GAIN OR (LOSS) 23,625 sf 18du 1,050 sf 0 spaces 36 spaces 36 spaces 12,600 sf ($ooo) $4,134 1,260 5,394 1,079 1,100 (7,573) 7,560/8,505 (13)/932 FAX: (650) 571-8590 HAROLD A. JUSTMAN, ESQ. REAL ESTATE ’A’I-]’OR N EY 3130 LA SELVA DRIVE, SUITE 307 SAN MATEO, CALIFORNIA 94403-2192 "TELEPHONE: (650) 573-0307 Attachment NI May 13, 2002 Ms., Karen Holman 725 Homer Avenue Palo Alto, CA 94301 Re: Response to Pierce’s Economic Analysis Dear Ms. Holman: In response to your request of me on.May 8, 2002, at the Planning Commission hearing for the back-up data for my statements to the Commission regarding the economic feasibility of~SOFA If, I report below. I understand that this information’ may be provided to others~ including the Planning Commfssion. I consent to this publication of the information which I am providing to you. This report is based upon the numbers provided in Mr. Pierce’s analysis of SOFA II. I did not add factors which he did not~ include. For example, Mr. Pierce’s analysis did not factor in bank loans and/or debt service. Accordingly, my analysis is based upon an all-cash build out. The only change I made in his numbers was to adjust .the land value for Scenarios 2 and 4. Scenario- 2: Build 5 new residential condominiums of 945 square feet each. Land $ 800,000 Improvements 1,200,000 Total Investment $2,000,000 Rent each condo at $2,000/month. Annual cash flow of $120,000. Rate of return 6%. hoIman 5-13 ltr.doc Ms. Karen Holman May 13, 2002 Page 2 Scenario 3: Build 7 new residential condominiums of 1,350 square foot each. Land Improvements $I, i00,000 3,100,000 Total Investment $4,200,000 Rent each condo at $2,500/month. Annual cash flow of $210,000. Rate ofreturn 5%. Scenario 4: Mixed use = 5 new res±dential condominiums of approximately 1,200 square feet and 3,150 square feet of commercial. Land $ 900,000 Improvements 3,100,000 Total Investment $4,000,000 Rent each condo at $2,000/month ($120,000). Rent commercial space at $3.50/square foot ($132,000). Annual cash flow $252,000. Rate of return 6.3%. The rate of’ return in each scenario would, of course, improve as soon as the general economy improves. In each scenario, a long-term investor could expect the value of the project to do~ble in 7 to i0 years. Please let me know if I can be of further assistance. Yours very truly, HAJ:ma cc: David Bubenik Harold A. Justman holman 5-13 ltr.doc City of Palo Alto Historic Resources Board Meeting of April 17, 2002 Attachment N HISTORIC RESOURCES BOARD Approved Verbatim Minutes April 17, 2002 Draft South of Forest Area (SOFA) Coordinated Area Plan Phase II: review and recommendation to the City Council. Board Chair Susan Haviland: We now move to the Public Hearings. And the first item on the Public Hearing is a review of the proposed South of Forest Area, SOFA, Coordinated Area Plan, Phase II and recommendation to the City Council. There are two Board Members--there’s a little business that we need to take care of before we proceed to this item--there are two Board Members, myself and Martin Bernstein, .who have a conflict of interest on this item. My office is actually located within the SOFA II area. Martin, perhaps you can explain your conflict? Vice-Chair Martin Bemstein: I’m conflicted out of this item because I own.property within 500 feet of SOFA. Chair Haviland: Roger? BM Roger Kohler: I have a question. I just discovered I may have a conflict but we’re not sure. Is within a year of doing work with somebody, is that the time period? Staff Lisa Grote: My understanding of this is that it is. If it has been a year or more then you do not have a conflict. If it’s been less than a year, then there is a possibility of a conflict. BM Kohler: Okay, well, neither of us could remember when I worked with this fellow. It’s probably been almost a year. I mean, I guess I can sit today and just verify if it’s been more than a year. Staff Lisa Grote: You do need to verify if it’s been more than a year. You may want to consult with our attorney’s office, which is our advice to Board Members who may have a conflict. BM Kohler: Yes, I normally do but I didn’t realize there was an issue until just a few minutes ago. Because ifI leave then we don’t have a quorum, is that correct? Staff Lisa Grote: That would be correct. There would not be a quorum. BM Kohler: Well, I think it’s been more than a year, so I don’t know what to do. City of Palo Alto Historic Resources Board Meeting of April 17, 2002 2 Staff Lisa Grote: It is your decision. The responsibility ultimately rests with you rather than with the City, so it is up to you to verify that it’s been more than a year. BM Kohler: Okay. It was a very small item so it wasn’t a major project. I think it’s my calculation that it’s probably more than a year for now and I’ll just have to research it, I just don’t know. Chair Haviland: Thank you, Roger. Since this is going to be a lengthy item, both Martin and myself are actually going to leave and we’ll give our phone numbers to Diana. And if there could be a recess after this item is completed, we can be called at the beginning of the recess and we can be here for the next item on the agenda. BM Kohler: What is the next kem? Chair Haviland: The next item is 900 High Street, that’s Item #2. We, unfortunately, cannot switch the order because of staff being here. BM Kohler: That’s fine. Chair Haviland: And Carol, since you are the previous Board Chair, if you would chair the meeting until my return? Thank you very much. BM Carol Murden: I have a question for staff before we begin. I think what I would like to do is have the applicant make the presentation, or the staff make the presentation, take public comments, and then I was thinking if we went through the CAP and had Board Members both ask questions and make comments at the same time, would that be appropriate? I thought things might proceed a little bit more quickly that way. Would that be all right? Staff Lisa Grote: I think that’s fine. BM Murden: So, this is Item #1 on the agenda, review of the proposed South of Forest Area, SOFA, Coordinated Area Plan, Phase II and recommendation from the HRB to the City Council. And this item was continued from April 3, 2002, which was a cancelled meeting. So, does the staff have a presentation? StaffLisa Grote: Thank you very much, Board Members and Chair Murden: Thank you for having me here to outline the Coordinated Area Plan, and Phase II of the South of Forest Area Coordinated Area Plan. As many of you know, the Coordinated Area Planning process started in 1997. It was originally one approximately 18-block area that was divided into two areas in order to address the Palo Alto Medical Foundation leaving the area--Phase I of the area--sooner than some of the other sites were expected to re- develop. So it was divided into two phases, Phase I and Phase II. Phase I was approved in March 2000. Some of that development is now occurring. City of Palo Alto Historic Resources Board Meeting of April 17, 2002 So this really encompasses just Phase II of the South of Forest Area. And that generally is the area that’s bounded on the north by Forest Avenue, the south by Addison, the west by Alma Street, and on the east by most of Ramona Street with some exceptiong on the west side for about 3 parcels on the west side of Ramona Street. On the map in front of you [map displayed on easel], the South of Forest Area Phase II is shown in pink in this area here. That particular map is intended to show the relationship of the South of Forest Area II to downtown. As you’ll see in the Coordinated Area Plan in the vision statement, the South of Forest Area is not intended to compete with downtown in terms of intensity or types of uses. It is intended to be a distinct area. And so this map was produced for the Working Group so that they could see the distinctions between the downtown and the SOFA area. As you read through the Coordinated Area Plan, the vision for the South of Forest Area Phase II is to preserve and enhance the pedestrian nature of the area, the neighborhood serving character of the area, the walkability and the general neighborhood orientation of the area. And that does include the historic resources that are in the area. There are, if you look at the goals and policies section of the Coordinated Area Plan which are pages roughly 18 through 20, there are several policy statements that relate directly to the historic resources in the area. There are about 30 buildings that have either been designated historic on our local Inventory, being Categories 1 through 4, or have been determined to be eligible for the National or State Register of Historic Places. And so, in total, there are about 30 such resources. Those are shown on a map in the Coordinated Area Plan--it’s Map 6. Since this is a draft, it’s a hand-written Map 6; it faces page 20 in the Coordinated Area Plan. So the darkened sites show those sites that have a historic designation. In particular, Policy DC-13, which is on page 19, calls for a Transfer of Development Rights program to be developed for historic resources in the area, so that if a property owner wishes to rehabilitate their existing historic building, that they can obtain the right or use the right to transfer off the extra square footage that would be obtained from doing that rehabilitation onto an eligible receiver site,, either in the SOFA Phase II area or in the downtown area. And that program is fully explained on page 35 of the plan in the Development Standards section of the plan. So that was a very strong feeling on the part of the Working Group and staff: that in order to help preserve the historic buildings in the area, that a Transfer of Development Rights would enable that to happen, so that you wouldn’t have to use that additional square footage on the site itself. There are two different square footages that can be obtained, or floor area that can be obtained, for a historic bonus. One is up to 25% of the total gross building floor area for any permitted use other than non-retail commercial (that usually equates to office). So, if you are adding retail commercial uses to a historic building, you can get up to 25% of the gross floor area in bonus square footage. If you are adding non-retail commercial uses, which would be typically office uses, then you would get 10% of the gross floor area of the existing building as a bonus. So there is less bonus for certain types of uses, commercial uses that are not seen as contributing as much to the overall vision of the City of Palo Alto Historic Resources Board Meeting of April 17, 2002 plan. So that you would have increased floor area for those uses that do contribute to that neighborhood serving vision in the area. There are several differences between the Working Group alternative, which was summarized as an attachment, Attachment E to the staff report, and the staff alternative. Those primarily have to do with floor area ratio in the overall Plan Phase II plan area and parking requirements in the overall plan area. And the FAR differences, floor area ratio differences, occur in specific parts of the plan area. The parking differences occur in the entire plan area. The FAR, based on the Working Group recommendation would be a maximum of 1.15 in the entire area. For a staff recommendation, we have put forward an alternative which would allow up to 1.5 FAR in certain areas along Alma Street, and those have been designated on the two plan concepts that were attached to your staff report as Attachment E and Attachment F. And primarily, the differences are along Alma Street between Addison and Forest with the exception for height limit at Homer. The height limit and the FAR would both drop down to 1.15 at Homer arid Alma. So that there would be a consistent FAR and height limit along Homer Avenue, which was seen as the historic retail core of the area so that that would not be altered. So that the height limits and the FAR would remain at 1.15 and 35 feet measured to the peak of the roof along the entire length of Homer within the SOFA II area. But that the FAR and the height could increase to 1.15 and 50 feet to the mid-point of the peak along Alma Street. Whereas the Working Group would retain 1.15 and a 35-foot height limit to the mid-point of the peak of the roof all along Alma Street. The parking requirements that the Working Group has proposed would equal those found in our current Municipal Code in 18.83 with no reductions permitted for location or proximity to the train station or other transit alternatives. The staff recommendation is to allow reductions in the parking requirements based on the proximity to the transit alternatives and the train station. So those are summarized in the plan itself, if you have questions about that. Then we also did show you a prototype development in the area based on the Working Group concept and then based on staff alternative concepts. So those have also been presented in your staff report as Attachments G, H and I, if you have questions about those. So, in summary, there is basic agreement between staff and the Working Group as to the vision and most of the policy statements. There are some alternatives presented by staff to the FAR and the parking requirements in the area. I know that there is at least one Working Group member here to speak to the plan, and I believe there are some potential applicants that are in the project area here also to speak to the plan. So with that I’ll conclude the staff report and be available for questions. BM Murden: Thank you, Lisa. As I said earlier, I think a good way to tackle this would be to take public comment and then to come back and just work through the plan quickly, City of Palo Alto Historic Resources Board Meeting of April 17, 2002 and see if people have questions or comments. However, before we start, does anybody have any specific questions they wanted to ask the staff or very general ones? 5 BM Kohler: Yes, very general. BM Murden: Okay, sure. BM Kohler: What’s your expected result from us today? Staff Lisa Grote: I would like to obtain comments from the Board, recommendations. If there are specific parts of the plan that you think may need some modification, ! would appreciate those comments. So, general comments and recommendations that will then be forwarded on to the Planning Commission and City Council before the City Council takes their action. This is also going to the Architectural Review Board tomorrow. BM Murden: And I think most of our comments will come on the section on historic preservation and design guidelines and so on. I will now open the Public Hearing and I have two cards: one from David Bubenik and then the next one is from Carol Jansen. ¯David Bubenik, 420 Homer Avenue, Palo Alto: Good morning. I’m Dave Bubenik, I live at 420 Homer Avenue, very close to this area. In fact, I live within the SOFA I area. I’m very interested in what happens here. I’m also here as a member of the Working Group, although I’m speaking for myself, not officially representing the group, and as President of Palo Alto Stanford Heritage, another item of interest in this area. SOFA II is probably Palo Alto’s most historic area, as we all know. It was born in 1891 when Anna Zschokke built the first new house in the University Park town which later became called Palo Alto. Since then, it’s developed into Palo Alto’s workshop; it keeps the traces of all phases of that evolution. There really is, I believe, a treasure for our City, one which many other cities would like to have for themselves. As a member of the Working Group, I’m very pleased to see staff write the provisions into the Working Group plan--the staff plan, too--for the preservation of these. It was a joy to work with them on that and to work out the details of how these would be preserved. I think we have the strongest regulations and opportunities set up in this Coordinated Area Plan of any plaCe in the City, given the legal framework for preservation we have in Palo Alto. And I urge you to go along with it and if you see opportunities to strengthen it, please do. The area contains 30 buildings, it depends on which map you look at. I’ve seen others marked with H, given to us as Working Group members which show 19. This one I’m holding can be interpreted as having 42 maybe, if you count the addresses in the shaded areas. It occurred to me last night what we really need is a definite list of the resources here which are covered under the preservation incentives and regulations. And I would urge you to ask for that. City of Palo Alto Historic Resources Board Meeting of April 17, 2002 As President of Palo Alto Stanford Heritage, I urge you to support our resolution, not only for the historic preservation of this area but for the maintenance of its particular character. And this includes not only maintaining the historic resources but what goes on around them, what is allowed to be built around them. And this, of course, means maintaining what you see on the photos there as a characteristic low-rise light density development of this area. Some density will occur but this area should not have to solve all of Palo Alto’s problems. . You are presented with two plans: a Working Group and a staff alternative or staff recommendations, depending on which text you read. That, as a Working Group member, is a surprise to me and also a cause for not a little dismay. Since this process started in mid-February, we were all working from a staff-generated draft plan. And what you see labeled as a Working Group is essentially that plan worked in a few details. Very late in the process, the staff aRernative appeared. In fact, I had a meeting which was called, well, it wasn’t even scheduled, and suddenly see larger densities being proposed as a staff recommendation outside of the Working Group process. Whereas all along I thought we members of the Working Group are working very closely with staff to develop a joint plan. This is not the forum to debate that but I do want to let you know, from an insider’s perspective that there are two plans here. I don’t know why, and it’s certainly was not because the Working Group and staff were fighting. Not during the meetings, anyway. Though, please do right by this area. I think, in general, support the Working Group plan. It’s the right thing to do from citizen participation, and also I think it’s the better plan for the area. Thanks very much. BM Murden: Thank you, David. The next card I have is from Carol Jansen. Carol Jansen, 575 Hawthorne Avenue, Palo Alto: Good morning, my name is Carol Jansen. I live at 575 Hawthorne Avenue in Palo Alto, and I’m working with the 800 High Street partners on the residential project on the former Peninsula Creamery site. I would just like to point out a couple of things that are actually contained in your staff report (but because these things are, as you know, have a lot of pages to them) related to the original Council directive to the staff and to the group that was working on the SOFA II plan. If you look at the ordinance, it’s number 4454 on page 2, and also on page 6, there are two very strong directives. I’ll read the one on 6 alone and it states that "A determination of the economic and physical feasibility of the plan with specific analysis of marketplace factors and incentives and disincentives to the desired development product, etc." Fundamentally, there was a very strong directive from the Council to look at the economics of the SOFA II plan. And I think that it relates back to the Council’s desire, strongly stated at the time, too, do we want housing in this area and, yes, we do, and how can we achieve that? And how can we work with these regulations, a Coordinated Area Plan, in order to achieve that? City of Palo Alto Historic Resources Board Meeting of April 17, 2002 7 If we go back to the last meeting of SOFA II, it was the very first time that there was any evidence introduced about what the economics of the proposals were, not only what the SOFA II Working Group was recommending, but also the staff alternatives. And those economic in a pro forma analysis basis was done by Steve Pierce, who happens to be a member of the Working Group and has regularly attended the meetings. In that analysis, he showed, first of all, a couple of, I think, important factors. One is that there’s literally only a handful of properties left within the SOFA II area that can be developed. The others have already been developed, substantially rehabed, have been approved for development or they are historic, and so they are not going to be eligible for substantial changes to them. And I’m talking about 4 to 5 parcels, fundamentally, one of which actually was considered at the meeting, that is, the Whole Foods parking lot, and the owner of that property, Chop Keenan, was there and said, "Color it any color you want, but nothing is going to happen to this so long as Whole Foods is on this site." In Steve’s analysis, he showed the group that even looking from a 1.15 FAR up to a 3 to 1 FAR on the Bill Yotmg Automotive service site, and I think he used that because it was sort of representative of a mid-size parcel that could be developed, and would probably be re-developed at some point in the future if the regulations permitted, that it was not economically feasible to develop this property for any other use in rehabing the existing building for purposes of, basically, use as a general office or general business kind of use. I think that was a very compelling and surprising thing for the group to hear, and I think it’s one of the reasons why there was a 6 to 5 vote with the 5 members who voted to continue the SOFA II Coordinated Area Plan simply because they didn’t see that they had addressed that and did not know how they were going to address it in the future. If you look at the SOFA II area, there’ve only been two housing projects developed in the last two decades, with regulations not all that dissimilar from what this Coordinated Area Plan is suggesting. And that is the Palo Alto Housing Corporation project, which was a Planned Community zone and, depending upon how you count the parking in, the floor area ratio between the 2.45 and a 3.78 FAR. And the 901 Alma site, which is office and four rental residential units which was also a Planned Community zone and was done at market initiative. The recommendations of the SOFA II Working Group and the staff also recommended that there be no PC’s permitted under this plan. I think it’s important for you to know that because it gets down to the fundamental question. Do you want housing there or do you not? If you do, then these plans will not produce it. Thank you very much. BM Murden: Thank you. My next card is from Doug Ross. Doug Ross, 909 Alma Street, Palo Alto: Good morning. I’m Doug Ross. I am a property owner in the SOFA II district and a partner in the proposed development that the HRB has [reviewed]. City of Palo Alto Historic Resources Board Meeting of April 17, 2002 BM Murden: Could you also state your address, too, please? Thank you. Doug Ross: So, I’m a property owner of the district and have interest in the property that’s under review for development as a PC. So, in following Carol’s comments, We do have an application pending for a PC for a housing project on the old Creamery site . which you’ve taken a look at on the Study Session basis before. So, my concern as a property owner is that in echoing Carors comments is that I believe the SOFA group has worked hard and long at doing their study. ButI think they really need to look more carefully at the economics because if they really want to encourage the 140-housing units that is the remainder left over after SOFA I for the 300-unit goal, somebody needs to look carefully at where that housing is going to be placed because there are very few opportunities. And elimination of the PC really is a down zoning, in essence, of those opportunities. And I guess in closing, I’d like to understand from the staff and from the HRB where a viable PC application fits into the process relative to the SOFA II study. Thank you. BM Murden: Thank you, Doug. I think a discussion of your last comment will come up as we through this. I have another card from Skip Justman. Skip Justman, 828 Ramona Street, Palo Alto: Good morning, I live at 828 Ramona Street, just down the street here, in the old Victorian that I remodeled a couple of years ago. And as a resident of this area, I wanted to address the economic issue. I guess the points being made, unless you give a higher density zoning, people can’t afford to build more housing. And I think the economic issue needs to be addressed in terms of what we presently see. Right now, there are a lot of vacant rental units in this area. And if you walk through north Palo Alto, you’ll see a lot of vacant rental units. So, right now, economically nobody is going to build anything because .the economy is not conducive to any building. And Jim Baer has told me he’s not going to be building his office buildings this year. So, the economics are dictated by macroeconomic events and, of course, if you rezone the density of a property high enough, it will encourage people to build even in a recession. But economically we can’t support any development at this time because nobody will rent it even if you build it, or you won’t rent it all out. And if you have vacancies, then economically it’s not viable. I think now is a bad time to argue that we need to build housing that’s affordable and zone the property at the highest density so that a developer can build as many units as possible. I think the marketplace will adjust, and in the future you can build lower density properties that will be economically viable as the marketplace adjusts. As demand starts to exceed supply when the economy recovers, then smaller density projects will be economically viable. But to come to you in a recession and say we need more density to justify, the economics is asking to put blinders on to the fact that we live in a real estate market that is boom and bust, and when the boom comes again, smaller density will be .economically viable. Thank you. City of Palo Alto Historic Resources Board Meeting of April 17, 2002 BM Murden: Thank you. I have another card, from Elaine Meyer. Elaine Meyer, 609 Kingsley Avenue, Palo Alto: I’m speaking as the President of University South Neighborhood Group and as a member of the Working Group. I don’t have much to add to what people have said before, just simply to support the recommendations of the Working Group to you. We didn’t just jump at some number arbitrarily. We argued about every detail in the plan and we hope you’ll support our recommendations. We also are property owners in this area. We own our homes here and we would like the community to look the way we recommended in this report. Thank you. BM Murden: Thank you. This question of what was presented at the last Working Group meeting has come up, I don’t know whether you want to comment on that or not? Staff Lisa Grote: A couple of comments were made about different alternatives that have been put forward. After staff looked at the 1.15 alternative that we had been discussing with the Working Group in terms of how that could be fit physically on the site, we found that it would be difficult to have a 1.15 FAR and still be able to meet the parking requirement. You’d have to put parking underground on all of the sites, basically, and some of them are quite small which would make it difficult. But it would also be economically harder to do if you had a 1.15 FAR and were putting parking underground. So we looked at a 1.5 possibility and a 1.7 possibility. It became economically more feasible to do it at a 1.5 or 1.7. We brought that back to the Working Group. The Working Group did not support a 1.7 at all and so staff said, okay, we will remove that from the discussions. There was disagreement, a variety of opinions about the 1.5, so staff retained that, but said it is more likely that you can get the underground parking with a 1.5, and recommended that the PC, the Planned Community zone process, be retained in order to get to that 1.5 FAR-,with some very specific public benefits that are also outlined in the plan, but they would have to do with childcare, public open space, other kinds of community services, perhaps public parking, other types of community oriented services. So that shows up now in the staff alternative to allow a 1.5 along Alma with public benefits as specified in the plan. At that point, one of the Working Group members did put forward some economic analysis of whether or not it was possible even with the 1.5 or 1.7 FAR to make the proposal economically feasible. His numbers show that it would be difficult. It would be difficult with anything less than something close to a 3 to 1 FAR. We had indicated that the economics will change over time and that if the Working Group wanted to continue doing that kind of an economic analysis, we would change the schedule and take longer to have that analysis done. The Working Group did not elect to do that. They felt that the schedule was important enough, and that enough work had been done to date to indicate that with a change in economic scene that this may become viable in the future. And we put it forward with the two different alternatives as shown in the plan. City of Palo Alto Historic Resources Board Meeting of April 17, 2002 10 BM Murden: Thank you, Lisa. I don’t have any more cards so I will bring it back to the Board. What I’m going to do is go through the table of contents. As I said, I think most of our discussion probably will be centered around the design character and guidelines in that area. I don’t think there’s any historic preservation before that. But I will run through these and if anybody has a comment to make, please stop me. I also will point out whether there has been an altemative presented by the staff. So, the first one is the Vision for the plan which is on page 3. Then the next one, Policies, which is chapter 3, the first one under that is Land Uses and that starts on page 4. And there is a staff altemative which Lisa has referred to which is allowing a greater FAR with an approved Planned Community zone change. I don’t know whether anybody wants to comment on that as we go through or they want to comment on that one later. BM Kohler: I guess I have another questibn for staff. When we reviewed SOFA I, one of the issue~ that came up was that there was an entitlement apparently granted to the developers of Phase I, in SOFA I, which meant that there were no options given to the committee reviewing SOFA I as to square footage and size and height of the building, that there was no flexibility provided for the design review group. And what happened was that, actually 3 of us were on the committee as well as ARB members, we were always trying to recommend that they cut off a comer of a building, reduce the height there, adjust things like that but we were told that we didn’t have that option. We were not permitted to reduce the square feet of the buildings. We were not permitted to reduce the number of units on the projects. We basically were commenting on the skin of the building rather than the overall shape and bulk and mass of the project because it was pre-determined within the initial program that that was signed off by City Council. And it was an item that kept coming up constantly through all the projects and the Board’s members, ARB and HRB, became very frustrated in that we really weren’t able to review the projects that we normally might do and make recommendations that if you took off these two units on the coruer of the building, the impact on the comer would be reduced if you were able to lower the height or this or that. The flexibility of a normal review process, especially if yoffve been at ARB meetings, they are pretty demanding and make some really stringent requirements on owners, and yet the Board Combined Group did not have that flexibility. And my question today is, is the same sort of built-in kind of granted maximums in place or would there be the flexibility? I guess the point of what I’m trying to say is that PC’s could be a really great thing, and having a PC in my mind does not mean a negative. In fact, it could be a huge positive where there could be some really great benefits to the community if there is a PC on the site where you get extra units but you actually gain parking, or you gain a small park, or there’s some retail. There’s a whole number of items that PC permits in a project that you don’t have, as you know, in standard zoning. But the issue that I have is that if you have PC’s and they come back and it says, well, it says here we can go 3 to 1 ratio and they were entitled to do that, that’s my question. I mean, I’m trying to understand as we go through all these issues, it’s kind of an overall guiding City of Palo Alto Historic Resources Board Meeting of April 17, 2002 .11 light--have there been standards that are kind of like a minimum in a way that these owners would be entitled to receive, or do we have flexibility? So if they come forth witha PC and they want 500 units, so we say, well, no, you have to have 3. I know that’s an extreme option but I’m just saying, would a normal PC process be in place; where you can ask, if they want extras, we get something in return, which I think you’ve already said. But I still remember some of the meetings we had. It was really contentious and it was very disappointing on the part of the Board Members not to have some. bargaining chips, in a sense, of how to work with the project on SOFA I. Staff Lisa Grote:. A couple of things. The first is that in SOFA I, I think you’re referring to a development agreement and parcels that were subject to a development agreement, which did further restrict what could be built on the site and what was agreed to as part of that development agreement, which then restricted the Board’s ability to make certain kinds of comments. That’s not the case with SOFA II. There isn’t a parcel or a set of parcels that are subject to a development agreement. There are, however, in both, if you want to call it the Working Group recommendation and the staff recommendation, limits on maximum FAR. In the Working Group version, it’s a 1.15 maximum with no opporttmity for a Planned Community zone change application. Specifically, the majority of the Working Group has said that if you want to, as a property owner, deviate from the plan in any manner, that would require a plan amendment which would go back through the review process and Council approval. In the staff alternative to that, there is some flexibility, but it would only allow up to a 1.5 FAR, and that application would have to have certain public benefits associated with !t, which are community oriented in nature. So there is just a bit of flexibility there to go up to 1.5 in certain locations, and those are called out along Alma Street. So there wouldn’t be an opportunity to apply for something greater than 1.15 in most of the area or 1.5 along Alma. So it does set some very strict limits to what can be applied for. .BM Murden: Does anyone else have any questions? Thank you, Lisa. If not, we’ll keep going. We were on Land Uses. There is another staff comment on page 5 but I believe this comes up again, later and maybe we should discuss it when we get to that. I think it comes up in the historic section, as I recall. So, if there are no other questions on the Land Uses, we come to Housing. And again, on page 10, and this is what Lisa, again, has just been talking about. Staff Lisa Grote: IfI could interject here. There is a typographical error on page 10 under the Working Group alternative. It should say, "SOFA II Plan allows residential development with a Floor Area Ratio of up to 1.15 to 1." The decimal points were inadvertently changed there. So, it should say 1.15 to 1. BM Murden: Okay. But again, this does refer to this PC zone that Lisa was talking about earlier. BM Kohler: What was that, 1.5? City of Palo Alto 12 Historic Resources Board Meeting of April 17, 2002 Staff Lisa Grote: The one on the Working Group alternative, it should say up to 1.15. BM Kohler: Okay, thanks. Staff Lisa Grote: And then under staff alternative, it’s the 1.5. BM Kohler: Okay. BM Murden: If we don’t have any questions on that, we can proceed through Housing. BM Kohler: May I ask another question? So, this happens to be one of those ratios that if you’re not in an area that would permit a PC, you would have to comply with this number? There’ll be no flexibility, I guess is what I’m asking? Staff Lisa Grote: Under both the staff and the Working Group version, if you’re in the majority of the area, it’s a 1.15 FAR. It’s only in the staff version that allows a bit of flexibility along Alma to get up to 1.5. BM Kohler: Okay, all right, thank you. BM Murden: Okay, going on: Housing and then we come to Transportation. On page 18, this is where the Working Group policy DC-5 recommended that there be no Planned Communities allowed within the SOFA II area. There was a minority opinion--I think the vote on the Working Group was 6 to 5--six said there should not be PC’s, five said there should be under certain conditions. The minority opinion is in green, and then the staff alternative is in red. [pause] Beth? BM Beth Bunnenberg: I had a question on some further clarification on what is meant by "substantial public benefit." Is that different from the sort of general statement of public benefit? Staff Lisa Grote: I think it was intended to indicate that there needed to be a great deal of public benefit to get up to the 1.5. We haven’t attempted to say it has to be a certain amount of square footage or it has to be worth a certain "~alue, but that there needs to be a considerable amount of one of these things such as childcare, affordable housing, parking. It was a way to indicate that it wasn’t just a token public benefit. BM Bunnenberg: Roger, would you consider that one of those chips--in terms of being able to deal project by project with things? BM Kohler: You mean the word "substantial"? BM Bunnenberg: Yes. City of Palo Alto Historic Resources Board Meeting of April 17, 2002 13 BM Kohler: Well, yes, I would think that’s part of the reason the PC is used, that you’re supposed to get public benefit. In the past some of the public benefits I’ve seen I’m not sure are really public benefits, but that’s another debate. But I think that’s the comment, yes. BM Murden: And certainly, as we go along, if people want to make comments on these as well as asking questions, I think that would be appropriate to do. BM Bunnenberg: Then I definitely feel that that "substantial" should have real backing and clout because in essence to give away some of the additional FAR, why, it really has to be something of value. And I think some of the things listed have been of considerable value, including childcare and single residency. Is there any proposal anywhere out there for an additional single residency? Staff Lisa Grote: A single room occupancy, such as an SRO? BM Bunnenberg: Right. Staff Lisa Grote: There is not, in SOFA II, any additional SRO other than the one that already exists there. At this point, there isn’t. BM Murden: I know, I was on the Working Group and I was one of the people that did vote against the Planned Community and that my feeling was that certain height limits, FAR’s, and so on, had been put in place by the group, and that that was what they wanted in this area. And that to allow a PC to come in where you get a larger building, you have greater FAR, was perhaps not appropriate. [pause] Starting on the same page, page 18, there is a section on Historic Preservation, and several policies are put forward on the continuing pages. Does anyone have any questions or comments to make on those? BM Kohler: Did we get transfer square footage? BM Murden: Yes, that’s talked about later. I don’t think it’s mentioned here. BM Kohler: All right. Staff Lisa Grote: The first place that the Transfer of Development Rights program is mentioned is the bottom of page 19 under DC-13, which is the policy statement. BM Kohler: When you transfer the rights, does the owner of the historic building have any requirements placed on him ifhe’s transferring square feet. Does he have to then maintain his building and use the money? City of Palo Alto. Historic Resources Board Meeting of April 17, 2002 14 StaffLisa Grote: The requirement is that a rehabilitation be under way in order to obtain the transferable development rights, and as conditions of approval for that rehabilitation there probably would be long-term maintenance requirements as well. But you do, as a property owner of a historic site, you need to be rehabilitating your building to be able to obtain those development rights that you could then transfer. BM Kohler: I guess we’ve reviewed several of those in the past where the project was in process. There was the new building where the Italian market is. Staff Lisa Grote: They usually run concurrently. Someone would be applying for both at the same time. BM Kohler: Okay, thank you. BM Murden: And there is some more on the development fights on page 35 which we will come to in a minute. Does anyone else have any questions or comments on these policies? Beth? BM Bunnenberg: Actually, as I look back, we passed over one area that is a very minor point and I wondered if it might be a typo even. And that was back on page 16 under some comments about the Museum of American Heritage and the Garden that is sometimes open there. And it’s about the middle of the page. There is some open space located at the museum--the Garden-- "although presently public access to the space is limited to guided tours during the hours the museum is open. And that sounds like you must even have a guided tour when the Museum is open." There are guided tours that happen during the week, and the gardens are open during that time. And the Garden is open to the public during the public hours that the Museum is open, which is Friday, Saturday and Sunday. Staff Lisa Grote: So, you don’t necessarily have to be on a guided tour to see the Garden? BM Bunnenberg: No. Staff Lisa Grote: Okay, I’ll correct that. BM Bunnenberg: It is a matter of having docents available because we have just fairly recently heard how passionate the historic gardeners are about even their freesias that are moving into the lawn. And so, the Museum feels very strongly that docents need to be keeping an eye on the people in the Garden, but they are absolutely free to use the Gardens during those open public hours. Staff Lisa Grote: I’ll correct that in the text. BM Michael Makinen: Just one comment here regarding the Policy DC-8 ("Allow exceptions up to 25% less than the full parking requirement to encourage.. Y), it’s on page city of Palo Alto Historic Resources Board Meeting of April 17, 2002 15 19, dealing with the exceptions to allow less than full parking requirements. Justthe figure 25% that is being proposed in here, I wondered what the rationale was for that number that you selected. Staff Lisa Grote: That was based on conference with our transportation planners, who have participated in other kinds of shared parking facilities or right-of-share type programs, who indicate that you can probably reduce parking up to 25% if you’re close to public transit and other means of transportation. So we had chosen the high-end of what could be the result of a successful transit program. BM Makinen: Well, I guess what I was hoping is maybe we could put some language in there that would allow some greater flexibility if it was reviewed by the HRB for compelling cases. Staff Lisa Grote: You could certainly recommend that. BM Makinen: That would go along with more of an incentive for the historic resources, that grant them a greater exception. BM Murden: Depending on circumstances when it was reviewed. How do the other Board Members feel about that? Beth? BM Bunnenberg: I have a very positive feeling about that because there are certainly times when, in the past, this Board has looked at properties and said, oh, my goodness, if we meet the parking regulations the wisteria will go or part of the back of the building will have to be changed significantly to allow for parking. So, I would really hope for a good bit of flexibility in parking. BM Makinen: I guess what I was suggesting, if we could put some language in there that would give the HRB some ability to set the number. BM Kohler: Maybe you don’t need to set the number. You just say exceptions are permitted with review and comment by the HRB and Transportation Department. Staff Lisa Grote: And we could make that recommendation, or you can make that recommendation. I’m hearing that it would also be for reasons other than successful Transportation Demand Management programs. It would be for historic preservation purposes so that other historic features could be preserved. BM Kohler: Well, the Museum itself wouldn’t be in existence if we had to meet the required parking on the site. BM Murden: Any other comments on these policies? BM Kohler: Are we commenting as we go? Or, we’re going to summarize it? City of Palo Alto Historic Resources Board Meeting of April 17, 2002 16 BM Murden: I think so, yes. BM Kohler: Okay, well, I was just going to say that, in genei:al, these policy statements are fairly well-written and I think would be good policies to have in place, just to comment positively rather than negatively all the time. BM Murden: We can certainly come back and comment on it. I’m just trying to figure out how we can get us through this: Public and Private Trees, and then we come to the Design Guidelines for Public Property which is on page 21. Does anyone have any ¯ comments on the public property, and then there is a section there that covers private property? BM Bunneberg: I very much support the encouragement of the paseos and alleyways. I think that has become a very effective tool downtown, and I would particularly like to highlight that one as one that is desirable. BM Murden: And then, on page 25, we come to the Design Guidelines for Private Property. I actually had a question on this, it’s on page 26--4.20.4 has Massing/Building Articulation. And it talks about, "fagade composition be articulated in modules of 50 feet or less, with major roof line or massing variations of a full story at increments of 100 feet..." I wasn’t quite sure what that meant. I understand the 50 feet modules but it was the 100 feet that I was not quite clear about. ~Staff Lisa Grote: I believe that is referring to buildings on separate pieces of property so that massing variations are 100 feet apart on different properties so that the streetscape has a certain rhythm to it. So this isn’t intended to be 100 feet on the same site but in between buildings on different sites. BM Kohler: It’s not written very well. Staff Lisa Grote: No, it isn’t. BM Kohler: Because the way I read it, it sounds to me like the fagade of the building has to be articulated in modules. And if you leave out the actual number, it makes a lot of sense, but to say, in 50-foot modules, you need to articulate this building within 50, but you’ve got a height of 50 feet, I mean, it’s a pretty huge, it sounds like you’re doing a high-rise building. I mean, my sense is it sounds like you’re articulating the fagade of the building in modules of sornething and I don’t know if those are the right numbers. But if I hear what you’re saying, it sounds like if you’re going down the block, every 50 feet there should be a ....I’m just not sure this is written very well. I don’t know what else to say. BM Murden: Yes, I thought with the 50 feet that it meant it should look as if, even though it might be one building, it should look as if the buildings were 50 feet, 50 feet, not wider than that. City of Palo Alto Historic Resources Board Meeting of April !7, 2002 BM Kohler: Oh, I see. BM Murden: Because that is a pattern in that area. I mean, there are many small buildings, but then the 100 feet is what confused me, but, yes, perhaps, it needs to be clarified. 17 Staff Lisa Grote: I think it does need to be clarified, and it was intended to mean 50 feet for the modules in the building itself, but then 100 feet between buildings so that you’ve got some sort of a rhythm or a pattern there, but it’s not reflected very well in here. We can work on that. BM Makinen: Would some type of graphic be helpful to explain that? Staff Lisa Grote: A graphic? Yes. And we can, again, have that prepared probably before the Planning Commission hearing on that. But I think it needs some clarification on just what we’re intending here anyway. BM Kohler: The graphic might work, but the graphics that are in the two-story design review are going to create more problems than I think they solve. But this is not clear on what’s going on, so it probably would be helpful. Staff Lisa Grote: Let me work on clarifying the wording and then having a graphic prepared which would probably be along the lines of the prototypes that were included in your packet, which are sketches rather than meant to be absolutely specific. BM Murden: Thank you. Beth? BM Bunnenberg: We have not talked a lot about height anal, of course, that runs through a number of these different reports, both the 35-foot max and the 50-foot. This Board did fairly recently review a proposal that had a 50-foot, but then had a parapet or another piece that extended even higher. Is there any way to put some limiton that kind of thing? BM Murden: Maybe if you can hold that question until the next section because I know we’re coming to that. BM Bunnenberg: Okay. BM Murden: The next section is Development Standards which start on page 28. These are not guidelines, these are standards..The SOFA II Working Group suggested one land use designation in the SOFA area. The staff suggested that there be two land use designations. I don’t know whether you wanted to comment on that, Lisa? Staff Lisa Grote: That really gets back to the previous conversation that we had about the 1.15 FAR and the 1.5 FAR, and these limited areas where you could get slightly higher City of Palo Alto Historic Resources Board Meeting of April 17, 2002 18 FAR. I would want to point out that both encouraged to the extent possible mixed-use projects, so an incorporation of retail commercial with housing. BM Murden: And then on the following page, that would be page 29, number N. The Working Group recommended that general business office would be prohibited on the ground floor south of Homer Avenue and along Emerson Street, and limited to 25% of the site area up to a maximum of 5,000 square feet (2,500 of which could be on the ground floor). The staff alternative was no limitation on the type of office in the area south of Homer Avenue. The difference here was the Working Group felt that Homer and Emerson were the commercial areas in the SOFA II plan of the area covered by that. And they felt that the area south of Homer should be restricted like the rest of Homer and Emerson, the staff alternative differed on that. Staff Lisa Grote: And ifI could,just a little bit of clarification. The staff and the Working Group were in agreement as far as Homer and Emerson in not allowing ground floor office of any type. You could above the ground floor, but not on the ground floor. It’s just the area south of Homer that there’s a slight difference of opinion. The Working Group had said no general business office south of Homer. You could still have medical or professional offices south of Homer on the ground floor, but no general business office on the ground floor south of Homer. That’s where staff said we would recommend that with the same size limitations but allow general business office south of Homer. So that was the distinction. BM Murden: Any one have comments on that? BM Bunnenberg: Well, each time you began to allow general business office, in some ways you cut down the pedestrian, the foot traffic, or the chances of small retail kinds of businesses going [in]. BM Murden: And then moving on, we come to the Site Development Regulations. There is a definition in here of compatibility with the existing area, this is on page 30. It’s saying the compatibility with the existing area is required for all new and remodeled structures. And then it goes on to define compatibility. And then on page 31 there are several staff alternatives and these are related to density. There is also a minority Working Group alternative under the Floor Area Ratio, which is in the middle of the page. BM Kohler: I guess, in general, the numbers, without seeing a project or physical result of these numbers, it’s hard to see. The lots are so varied you don’t know what you’re going to end up with in terms of these numbers. BM Makinen: I had one thought to go along with your earlier comment, Roger, about the inflexibility in our prior process here. It might be advisable to put some type of alternative that a person could go to other than these strict numbers if they make an appeal. City of Palo Alto Historic Resources Board Meeting of April 17, 2002 19 BM Kohler: Well, that was part of my original comment that, in fact, the previous SOFA had kind of an extreme, they’re guaranteed so many square feet and heights. And here we now are, they’re restricting the maximum, but I guess my original comment was that to not just automatically eliminate PC’s although I know there’s a lot of discussion about it. It seemed to me that they might be losing out on something that would actually be a benefit to the City. I hate to go against what everyone has worked on, and they went into a great depth where I have not. So that’s just off the top of my head, I think that’s sort of what Michael is saying, too, is that the numbers sound fine. So Lisa, I guess, if someone came to you and said, you know, if we came up with a 1.25 ratio instead of 1.15, we get another unit and the City gets some parking and they said we couldn’t do that, is that correct? Staff Lisa Grote: Only along Alma, as proposed currently. So they couldn’t do it in the rest of the area. BM Makinen: Well, that was what I was kind of suggesting, that maybe some type of mechanism, Or there’s an appeal process, or exceptional merit of some sort could be built in, or there could be some. flexibility inthis rather rigid framework. BM Murden: I was going to say, as I understand this, the staff is recommending that there be PC’s but there still is a limit. Staff Lisa Grote: There’s a limit still of 1.5 and there’s a location restriction as well, or limit as well. So it’s flexibility but only in certain parts of the SOFA II area. If the HRB would like to comment that there should be other types of exceptions, then we can note that in the comments that go to the City Council ultimately, but that would be up to the Board. BM Murden: Beth, on page 32 they talk about the heights. BM Bunnenberg: Andmy concern is that, as we’ve looked at some projects, 50 feet is really quite high when you compare it to some of the surrounding properties, and then I have great concerns that there are these additional bits that can even be tucked on the top. Is there a way to make sure that the 35 and the 50 are more absolute kinds of numbers? Staff Lisa Grote: That again, would need to be a recommendation coming from the Board. At this point, the Working Group alternative as well as the staff alternative doesn’t change the 15 foot additional allowance for rooftop screening. BM Kohler: Did you say, it doesn’t allow for the extra? Staff Lisa Grote: It doesn’t change the allowance which means it is allowed. Under our current Zoning Ordinance, you can have up to 15 feet above the height limit in any district for rooftop screening of mechanical equipment. So, that would be retained in this City of Palo Alto Historic Resources Board Meeting of April 17, 2002 plan. Now, the HRB may want to comment on that and forward those comments on to the City Council. BM Kohler: So, if you’re building a house and put an air-conditioning unit o~ the roof, you get an extra 15 feet? Staff Lisa Grote: Any commercial district, excuse me. BM Kohler: Okay. Staff Lisa Grote: Commercial or industrial. 2O BM Kohler: It seems to me that that goes back to the original question, just what Michael was saying, that the flexibility goes both-ways. If the 50 feet plus 15 is just not working on a site, it’s not an automatic grant that you’ll get permitted to do that. Staff Lisa Grote: It still goes through design review. So if the Boards that are reviewing a particular project cannot make a finding that that design is compat!ble with the surrounding area, there would be grounds for changing it, reducing it, of asking/requiring a different location for mechanical equipment. So there are options in there. You don’t have to approve the additional 15 feet. BM Kohler: Yes, I think that’s where some issues in the past didn’t have that option, I guess. Okay, thank you. BM Murden: Underlying this whole plan is the fact that there is this compatibility requirement. Staff Lisa Grote: That’s correct, and the Working Group and staff both felt strongly that the compatibility requirement should be part of the Development Standards. So that’s why you see it in that section so it gives additional means for review and for modification should something not be compatible. BM Murden: All fight, are there any other comments or questions on this area? I’ll have a question in a minute. One of the things that somewhat concerns me, and I think this happened a little bit or somewhat in SOFA I: whereas I agree with the historic bonus and the Transfer Development Rights and so forth, sometimes I think that can end up, and particularly in the SOFA II area where you have small buildings, if you had 2500 square feet, I’m talking about the seismic bonus now [as an addition] to a 1,500 square foot building, I had a little bit of concern as to what you would end up with. I know it must be compatible; but I don’t know, maybe Dennis actually might want to comment on that, on these additions. I’m concerned that you’ll get a small building with a huge addition in theory, because these are supposed to adhere to the Secretary of Interior Standards. You should be able to say no, you can’t put that much square footage on. City of Palo Alto Historic Resources Board Meeting of April 17, 2002 21 Staff Dennis Backlund: This matter is discussed in the Secretary’s Guidelines under additions. The Guidelines are designed to help one to use the Standards more precisely and what’s addressed there is that a successful addition is usually subordinate in the way that it’s experienced. Scale and sometimes even height can be a matter of apparent perception. It can be made to seem smaller through design strategies. But the apparent experience of the addition should be subordinate to the historic building, or’it dominates the character of the entire structure and, therefore, reduces the significance, of the historic structure. BM Murden: So that even if the seismic bonus was given, but by using the whole, say, 2,500 square feet, this impacted the historic character of the building, then the applicant would not be allowed to use the whole 2,500 square feet. Is that correct? StaffBacklund: I can defer to Lisa also on this but my own impression is that if it is a historic building and an outcome was found by the Board not to comply with the Secretary’s Standards, it would be .returned to the applicant for redesign and differing strategies until it did appear to comply with the Standards. BM Murden: It’s a difficult thing in that you want people to seismically upgrade their buildings, and I think it’s great to give them the extra square footage. But it also places, I think, the Board in a little bit of an awkward position when you come back to them and say, "Well, you can’t do that because it doesn’t meet the Standards." Staff Lisa Grote: The way the current wording is stated, the seismic bonus actually has to be used on site, and I understand your point. It doesn’t allow for transferring that off. So if your building is eligible for both the seismic upgrade and a historic rehabilitation, then we would be in essence saying you could transfer off the extra square footage for the historic rehabilitation but not the seismic upgrade, which isn’t consistent. We would want them to be able to transfer off the seismic bonus as well to enable the preservation of the existing building and yet not penalize the owner for doing the seismic upgrade. So, I think.what we may be headed towards is minor allowances for transferring seismic bonuses if they are on a historic building and cannot be found to meet the Secretary of Interior Standards. So that you then wouldn’t be penalizing the owner for doing a seismic upgrade; they could sell or transfer their additional square footage. BM Murden: Yes, that might be a good solution. Because, as I’ see in SOFA I, there .were historic buildings that got seismic upgrades. And so if you ended up with a much larger building, and particularly in SOFA II where ttie buildings are smaller, generally speaking, to begin with, One could see a bigger, real problem. Staff Lisa Grote: You may want to come back to this as part of your recommendations. You may want to modify, or recommend modifying, the seismic bonus section of the Development Standards to enable transfer of development rights in those instances when the building is eligible for both--historically and seismically in need of an upgrade--so City of Palo Alto Historic Resources Board Meeting of April 17, 2002 22 that if that seismic bonus square footage is not determined to meet the Secretary of the Interior Standards, it may be transferred off the site. BM Murden: I would like to make that recommendation. Staff Lisa Grote: You may want to make a motion on that kind of recommendation. BM Makinen: You want to wrap all these up in the end as one recommendation? StaffLisa Grote: I would saY that you would probably want to make all your recommendations together so that if you want to include this one, to include it at the end with all your other recommendations. BM Murden: All right. Does anybody else have any comments on this section? We’re going through it. Okay. And then we come to this section on Implementation; page 37 is where it starts. And at the bottom of page 38, it talks about who is going to review what and how it will be reviewed. And what is being recommended is that identified historic uses and sites and non-historic uses and sites that are adjacent to or across the street from historic uses and site shall be reviewed by a combined HRB/ARB Board, and process is established and so forth. Non-historic uses and sites that are not adjacent to or across the street from a historic use or site would be reviewed by the ARB alone, which is different from the way they were reviewed last time. Yes, comments from the Board? BM Kohler: My first impression was that the entire site is somewhat historic as was noted in the beginning of the report and to suddenly say, within this historic site, this project is not near historic buildings, per se, and the HRB is no longer involved, there seems to be a bit of a conflict there. I thought it said here in the beginning that this whole area is a historic site. So, I’m not at all sure if they’re asking for.more work on the part of the HRB but I’m just, that’s my first thought on that one. BM Murden: You feel that it shouldgo to a combined ARB/HRB? BM Kohler: Probably it ought to. BM Murden: Michael? BM Makinen: There’s a concept within the area of federal property historic preservation called the area of potential effect. That’s if you have a project that has the capability of affecting a historic property, and it’s in the area of what they call potential effect, that has to be taken into account. And maybe that philosophy can be applied here--that if properties which could have an effect upon historic properties are within a potential effect, they shall be considered. Staff Lisa Grote: You may want to make that recommendation. That’s pretty much the reasoning behind the recommendation for adjacent to or across the street because most of City of Palo Alto Historic Resources Board Meeting of April 17, 2002 23 the time those areas of potential effect impact or affect the site directly next door, directly adjacent to the historic property itself. But you may want to recommend that that become clear. BM Makinen: That boundary for area of potential effect is somewhat nebulous but if you can say your project does influence a historic property, it could be two properties away or could be five properties away. But I think if you had some language there that can reflect that or to accommodate that. BM Murden: Beth? BM Bunnenberg: Well, certainly, the whole concept of the streetscape which is very important on, for instance, Homer, and probably some other areas, that the look of the street certainly extends much more than one property over or two properties over, and the fact that a very large building could totally overshadow both physically and visually some very small resource. BM Makinen: Maybe we could have some language when we get to the recommendations that states that the HRB shall find the area of potential effect for this project when something occurs within that area of potential effect, even though it’s not historic but it could affect a historic property, and [this] shall be taken into account and reviewed by the HRB. That would be my recommendation. BM Murden: What I’m hearing the Board saying is that they would like to review everything that goes on in that area. BM Makinen: I think the HRB should be given an opportunity to define the area of potential effect for these projects, not just if it’s adjacent or across the street.. That is a recognized concept, though, within the federal government. I have had dealings with SRO and I’ve had to work through those arguments myself on several times, several occasions. Staff Lisa Grote: It is, in fact, why the SRO on Alma was determined to come through the HRB because it was next to the Pringle Gas Station, which is a historic resource, and it was within the area of potential effect, or the Pringle Gas Station was in the area within potential effect. However, I don’t think the Board determined that. I think that was a staff determination and then we brought that project to the Board. So, you may want to discuss who makes the determination that a project is within the area of potential effect. BM Murden: Does the Board want to say that everything in SOFA II should be reviewed by the HRB, or that each project should, as Lisa said, come to the Board and the Board decides that this is one they would like to rule on or review? BM Kohler: It may be that there’re so many historic sites in here that just about everything is going to have an impact on historic sites. I guess I was the first one who City of Palo Alto Historic Resources Board Meeting of April 17, 2002 24 initiated this, but I think the idea of at least looking at potential projects with some staff guidance, we could probably come up with a pretty good list of items that could help determine when, in fact, the project has an impact on a historic site--even two or three units, or lots, or a block away or whatever. But this area is not a large area so this may be a moot point. In fact, almost everything may be related to a historic building of one kind or another. But I think our future comments probably ought to be put in there. BM Makinen: That is a well-recognized concept and it’s used in the federal world for historic preservation. BM Murden: But as Lisa said, who would make that determination? The staff or Historic Preservation Officer? BM Makinen: In general, historic people concerned with historic properties would make that determination. I would think appropriately it would be the HRB. BM Kohler: One comment about that hotel--I mean, the single-unit project next to the gas station--is the fact that the project that the HRB reviewed is not the one that eventually got built. There were some subtleties on the end [wall] of that project that related directly to the gas station and that we were told were going to happen. And when it got built they didn’t happen, which was a surprise to me. There was supposed to be more of a setback on the one unit closest to Alma; then you go out there and it’s basically on the property line. The original drawings we saw, it was a 4, 5 or 10 feet, I can’t remember, setback. In actuality, it ended up getting built closer to the gas station than on the drawings that we saw, which I found a little disturbing. But at that point there’s not much you can do about it, neither here nor there. Staff Lisa Grote: We would need to look into the specifics of your comment. BM Kohler: It’s nothing I’m asking you to do. I’m just saying. Staff Lisa Grote: Yes. It’s the area of potential effect, it sometimes doesn’t span the entire site that’s adjacent. And in that particular case, I think it was that one wall, and that’s why modifications were made to that one wall. It didn’t extend to the entire project but there is certainly some discretion there on what can be done to modify a project so that it doesn’t negatively impact a historic resource. So, my recommendation is that the area of potential effect would be determined by a historic resources planner, and then those determined to have that kind of an impact would be brought forward to the joint Board, the joint HRB/ARB, for a review. BM Makinen: I guess my comment would be if the historic resources planner proposes that, it should be confirmed by the HRB for the area of potential effect. It’s okay for the planner to propose it but it should be confirmedby the HRB. City of Palo Alto Historic Resources Board Meeting of April 17, 2002 BM Murden: So that would mean that any project, I’m not sure what you’re saying. any project in that area would confirm the conclusion of the Historic Preservation Planner? 25 BM Kohler: Maybe the Board should have at some point, maybe the recommendation would be that the Board have a meeting to review the federal standards and things like that as to what creates an impact and for us to either adopt those or create our own set of requirements that would help the Preservation Officer with this when the projects come along. I think I’d be happy with that. BM Makinen: Well, some determination by somebody with some oversight should be part of the process, I believe. BM Kohler: I guess we had a thing when we were doing the compatibility review. I guess it’s typical of a consent calendar item that if we were notified that there’s a project coming forth and the Preservation Officer has determined it doesn’t have an impact, that the Board, if they wanted to~ or there’s enough members who felt that they wanted to talk about it, it would get at least to come to the Board for discussion. Maybe that’s the way to go. BM Murden: Now, perhaps items could be put on a consent calendar for the HRB and if the HRB felt that they should be reviewed by the joint HRB/ARB, they would then go to the joint HRB/ARB Board. BM Bunnenberg: I believe that I could go along with that, but one of my concerns is that sometimes on this Board we don’t know that something is moving forward unless we get some kind of list of addresses and so forth that are early in the process, and then suddenly we’re needing to play catch up or say, "Wait, is there a way we can look at that." So to try to head that off and have early notification, say, the consent calendar, I think might be very helpful. BM Murden: How does staff feel that that would work? Staff Lisa Grote: Well, I did want to mention that Dennis has put together a list of the buildings in the SOFA II area that do have historic significance. And those include Categories 1 through 4 in our local Inventory, as well as those that are eligible for the California State Registry. So, we do have that kind of a list. And I’m sorry it didn’t get included in your packet, but we do have that. BM Bunnenberg: But mine was consideration of a list of projects coming up. That would be a very, very handy list. And thank yofi, Dennis, for getting that ready because that would be helpful, but I was speaking of addresses of projects upcoming. Staff Lisa Grote: I think what we would need to do is look into the applicability of this area of potential effect. I’m aware that we have used that in the past. I don’t know that it City of Palo Alto Historic Resources Board Meeting of April 17, 2002 26 applies to every project on a historic site or every project that may affect a historic site. So we would need to look into the applicability of that potential area of effect, and to be able to determine what sites may or may not be subject to it. BM Murden: What I hear the Board saying, and correct me if I’m wrong, is that the whole SOFA II area is considered a historic area andthat, therefore, anything that’s done there should be reviewed by the HRB/ARB. But then I think the Board perhaps went on to say that there might be some projects that maybe we don’t need to review. Is that correct? It’s not a very big area. Staff Lisa Grote: I don’t think that there has been an analysis done of whether or not the entire area is historic. Certainly it was looked at--all the buildings in the site area--and we determined those that were eligible for National or State Registry, and we have our own Inventory that would designate 1 through 4 Categories. But the entire area hasn’t been found to be historic. So it’s not a historic district. That’s why we separated out those sites that are specifically historic from those that are not. If the Board recommends that the area be treated as a whole, then that would go forward as your recommendation. I don’t know that there’s enough substantiation for staff to be able to support it being treated as a historic area overall. BM Murden: No, it hasn’t been recognized. Does anybody else have any general comments? If not, we can try and make these recommendations. Okay, there was One on parking, the one on the seismic bonus, i think we want to say something on this reviewing and perhaps we should make a recommendation on the Planned Community. Does anybody want to attempt to do this? BM Kohler: Do you need to reiterate each of those in detail? BM Murden: I think Lisa wanted it in specifics. Staff Lisa Grote: Yes, if you could. BM Kohler: Why don’t you start with your list? BM Murden: Okay, on the PC, which is the difference of opinions or the different things put forward that are on page--do you know what page that is on, Lisa? Staff Lisa Grote: Page 31 is where the development standards for Floor Area Ratio and where references to PC’s are made. BM Murden: I think the Board could recommend if either the Working Group’s, the minority Working Group’s, or the staffs alternative, if one of those specifically was something that the Board agreed with. Or, of course, we could change them. City of Palo Alto Historic Resources Board Meeting of April 17, 2002 27 BM Kohler: I guess my point is, from a HRB point of view, which is what we are doing here today, that my comment would be that to automatically remove the possibility of Planned Community designation might have a possibly negative impact on a historic structure, and the fact that you would preclude the possibility of doing some, I don’t. know what, but there may be something that with a PC might provide an incentive, a benefit to the historic structure, or site that may not be available if you’re limited with no PC option. I guess that’s what I’m thinking in terms of the historic structure, it might be like on the low-income housing site in SOFA I, they moved one of the buildings, and I guess my point is that the PC does allow flexibility with zoning and requirements and that may be a benefit to preserving a historic structure or enhancing a historic structure that may not be available with the strict recommendations. So, I guess when it comes to a historic building I would say the HRB would recommend that it not be totally outlawed in the sense of absolutely not permitted. I don’t know how to phrase it but maybe a PC option would be available if it was a benefit to a historic structure. Maybe a simple phrase like that might be of some use. Because as a Board our goal here is preservation of historic buildings, historic sites, landscaping and gardens, and from my experience in planning it may be that the PC provides an alternative that’s not available with strict adherence to the zoning to preserve a historic building. BM Murden: I had a question in reference to that. The City zoning underlies this unless the plan changes the City zoning in some way. So, certainly for residential properties, things like HIE and so forth would still be available? StaffLisa Grote: For the existing single family residential HIE would be available but the plan really does change most of the sites. So, the underlying zoning which is CD-S, in most places it’s CD-S(P), would no longer apply. Now, the plan does retain the R-2 and I think there’s a bit of RM-15 in there so it does retain those residential zones. BM Murden: So what Roger is suggesting in reference to the PC is that there be a Planned Community option if there is a benefit to a historic structure. And the next one was the parking. BM Kohler: This is to staff. You’re going to respond, in fact, it [PC zoning] is a major negative and that there’s no way it could possibly happen, is that correct? You’re here to take our recommendations; then you will respond in the future? Staff Lisa Grote: That’s right. I’m here to get your recommendations. Some of them staff may be able to support, some of them we may not be able to support, depending on what they are. BM Kohler: Okay. Staff Grote: But we will forward them on to the Council whether or not we support them. City of Palo Alto Historic Resources Board Meeting of April 17, 2002 28 BM Murden: Michael, on the parking, you had recommended that the HRB have the option of being flexible on the parking rather than the 25%. I apologize, I didn’t write these pages down. BM Makinen: Well, the HRB should be given the opportunity to make the recommendation on what the allowance should.be rather than just 25%, or whatever is appropriate. StaffLisa Grote: And that’s on page 19, it’s Policy DC-8, and the parking reduction could be considered for preservation of historic features on the building or site. BM Makinen: Yes, a preservation incentive. So I guess that captures everything. BM Murden: And then the next one is the seismic bonus. And that was, in the case of a seismic bonus, there bethe possibility that part of the seismic bonus on a historic building could be used as a TDR. And then the last one was what should be reviewed. Does anybody want to try and put that into words or into a recommendation? BM Makinen: The historic planner shall make a determination as to what the area of potential effect is, and that the proposed area of potential effect shall be reviewed by the HRB and confirmed. It probably needs some additional words in there, too, tied back into the projects. StaffLisa Grote: And if it is confirmed, that those projects would be reviewed by the joint HRB/ARB? Is that where you were headed? BM Makinen: Yes, I guess. Staff Lisa Grote: Okay. BM Murden: Okay, so what I have now, and Lisa you may have this a little bit more clearly than I do, is that the HRB recommends that there be a PC option if there’s going to be a benefit to a historic structure. PerhaPs I would like to add that there should still be the constraints that there are in the staff report, that is, it can’t go above a certain size. Staff Lisa Grote: You need to put that forward to your Board Members. BM Murden: Yes, right. The staffis recommending that there be PCs but there are some constraints on those. Or do you want to just make a general comment, Roger? Just say a PC would be allowed. It’s on page 31. BM Kohler: Oh, I don’t know~ BM Murden: Did you just want to make that general? City of Palo Alto Historic Resources Board Meeting of April 17, 2002 BM Kohler: General is fine, I would think. I have a feeling it’s not going to come up. BM Murden: Okay, that was the Planned Community. Then the second one I have is that the HRB should be given the option to determine what the parking requirements are on historic buildings. Is that what you have? Staff Lisa Grote: I would say the joint HRB/ARB, since that’s the review body, and that the parking reduction could be determined as an incentive for historic sites, that the parking reduction could be determined by that Board. BM Murden: That’s much better, right. BM Makinen: That’s the parking reduction benefit: BM Murden: Okay. Then the next recommendation is that it be considered that part of the seismic bonus be allowed to be used in the TDR? Staff Lisa Grote: Again, you might want to put that forward to the Board but it could be that all or a.portion of the seismic bonus could be transferred if it’s not found to be compatible with the Secretary of the Interior Standards. BM Murden: I think that’s fine, too. And then the last one was that the historic planner make the determination on projects as to what the area of potential effect is and that those projects be reviewed--the ones that he decides are going to be in an area of potential effect. 29 BM Kohler: I think what Michael is saying is that all projects should come forth in the district. In other words, ifhe’s decided that they be reviewed, to see whether we feel they have a potential, not just those that he defines have a potential. That was the idea. I think that was what Michael was asking. At least we have the option of saying we think it has a potential even though the staff says it doesn’t. I think that’s what we were saying. BM Makinen: Yes. I guess that comes back to what was said before. It might not be right next door or across the street. It could be something greater than that. BM Murden: Okay. The historic planner would make the determination as to what the area of potential effect is and then that would be confirmed by the HRB? BM Makinen: Exactly. BM Kohler: Yes. BM Murdeni And that those projects that are deemed to be in an area of potential effect be reviewed by the HRB/ARB? City of Palo Alto Historic Resources Board Meeting of April 17, 2002 BM Makinen: Those projects that are within the area of potential effect. BM Murden: Yes, okay. All right, so then are we r~ady to vote on these? BM Makinen: Yes, indeed. BM Murden: All in favor? 30 All: Aye. BM Murden: Opposed? That passes unanimously with the 4 members here. Historic Resources Board Action: The Board voted to forward the following four primary recommendations to the City Council: (1) Allow Planned Community zone changes throughout SOFA 2 if the public benefit is historic preservation; (2) Allow the ARB/HRB to modify on a case by case basis the provision of Policy DC-8 so that parking exceptions on historic sites could exceed 25% to encourage historic preservation; (3) Allow all or part of the seismic square footage bonus for historic properties to be transferred offsite when applying it onsite would not be consistent with the Secretary’s Standards for Rehabilitation; (4) Allow the ARB/HRB to review new construction anywhere in SOFA 2 that might adversely impacrthe significance of the area’s historic resources if indicated by application of the federal concept of the Area of Potential Effects. Vote: 4-0-2-1 (Mario absent, Haviland and Bemstein not participating) BM Makinen: All subject to Roger’s review of his potential conflict of interest. BM Kohler: Where’s Millie? Is she coming back? BM Murden: I don’t know. So, Lisa, is there anything else that we need to give you? Staff Lisa Grote: No, I think that was fine. Thank you very much for your recommendations and I will, on those areas of the plan that you commented on the lack of clarity, I will go in and review those and get those clarified. So, thank you. BM Kohler: So, are all projects in SOFA now subject to the SOFA plan? Or are put on hold? Staff Lisa Grote: Those that are proceeding under the existing zoning, the CD-S(P), are still proceeding through because they are under existing zoning. The SOFA plan has not yet been approved so it’s not yet applicable. There is the Planned Community application that’s currently in process. That pre-screening was put on hold by the Council until the SOFA II plan is acted upon. City of Palo Alto Historic Resources Board Meeting of April 17, 2002 31 BM Bunnenberg: And I just wanted to thank Lisa for a very.clear presentation and also to thank you for the charts that summarized ihe major points: That was very, very helpful. BM Murden: Thank you. We will take a 5-minute break now. Architectural Review Board Verbatim Minutes April 18, 2002 DRAFT EXCERPT Attachment 0 Chair Bellomo: Motion passes, 4-0. We’re moving on to New Business, Major Public Hearings, Item #3. SOFA II Coordinated Area Plan Discussion, request by Staff for Architectural Review Board review and comment on the Draft SOFA II plan. Lisa? Staff Lisa: Thank you, Chair Bellomo and Board Members. It’s a pleasure to be here to present to you the Draft SOFA II plan. As you, may be are aware, the Coordinated Area Plan process started in 1997 with the approval of the Coordinated Area Plan Ordinance and a policy fi~amework which were included in your packets with your StaffReport and the plan itself. Originally, the SOFA area was one generally, 18-block area that was divided into two areas, Phase I and Phase II in order to respond to the Palo Alto Medical Foundations vacating the Phase I area to locate on their new campus. The Phase I plan was approved in March 2000 and is currently partially under construction. So what’s before you today is the 9-block area that is Phase II of the SOFA area, and SOFA does stand for South of Forest Area. It is bordered on the north by Forest Avenue, on the south by Addison Avenue, on the west by Alma, and then on the east by Ramona. And that is shown in a couple of site plans and maps in your Staff Report. The vision for the SOFA II area is to preserve and enhance the existing architecture and variety of uses to preserve the walkability and the neighborhood character of the area. That’s the general vision as stated in the vision statement in the plan. The goals and the policies all support that vision and in particular call for historic resources that went to the Board yesterday, call for a transfer of development rights program to allow historic square footage that is accumulated by a rehabilitation of a historic resource to be transferred offthat historic site and on to an eligible site either non-historic site, either in the SOFA II area or in the downtown. So that was an order to preserve and enhance the 30 some historic structures that are in the area now. One of the comments that the Historic Resources Board made, and I think there is a Historic Resources Board member here to go over their comments. One of the comments that they had made is that transfer of development rights program should be applicable to seismic bonuses as well in order to preserve historic resources. So, if a building is undergoing both the historic rehabilitation and the seismic upgrade that the portion of the square footage that’s allotted for the seismic upgrade should be able to be transferred off the site as well, either into the SOFA area or in the downtown area. And I believe Roger Kohler is here to give you more details on that, what the Historic Resources Board had said about that program and about the plan in general. The development standards outlined what can actually be built or added to existing sites in the area. There’s a substantial agreement between the working group that has been working on this plan for the past three years, and especially in the past couple of months and the Staff Page 1 recommendation. However, I’m sure you noticed that there are some areas where there are working group alternatives and Staff alternatives, and I did want to go over just briefly on some of those areas. One is that the working group plan does call for a maximum of a 1.15 floor area ratio for each site in the area. Within that 1.15 FAR .4 of it can be used for commercial purposes. So, retail or office or other commercial related purposes. That is consistent with what is currently in the SOFA II area. That is also consistent with Staff recommendation. The remainder of the 1.15 FAR are about .75 can be and needs to be, is required to be used for housing. And that is seen as a slight bonus over and above what is currently in the SOFA II area to encourage and promote housing. So, it would be a 1.15 total FAR. The Staff recommendation is to along portions of Alma and portions of High Street, allow up to 1.5 FAR. Again, only .4 of that to be used in commercial purposes but the remainder to be in housing purposes, too, or for housing use to further encourage housing. As part of that 1.5, however, a PC application would need to be made and approved and substantial public benefit including things like childcare, public parking, public open space, other kinds of public related facilities would need to be part of that Planned Community application. The differences there are in the FAR itself being able to go up to 1.Srather than the 1.15 and also the ability to apply for a PC in order to accomplish that. In the working group alternative or in the working group plan, there are no accommodations for a Planned Community zone changes. Any project that deviates from the plan itself would need to go through a Plan amendment and be considered by Planning Commission and City Council. The parking is another area of some difference. The working group has recommended that the parking standards found in 1883 of our Municipal Code of the Zoning Ordinance, in other words the existing parking requirements be maintained in that area that reductions not be considered for either transpo.rtation demand programs or proximity to the train station or other forms of public transit. The Staffs recommendation is that reductions do be considered for transportation demand management programs and also for the location close to the train station and other forms of transportation. So we are recommending reduced parking rates as outlined in the plan. The height limits are measured still to the mid-point of a slope or pitched roof for both the working group alternative and the Staff alternative. There are areas that are allowed to go up to 50 feet to the mid-point of the sloped roof. However, the difference between the working group plan and the Staff recommendation is that where that 50 feet can .be located is in a slightly larger area for the Staff recommendation. It does extend along a greater length of Alma Street and on to portions of High, whereas the working group alternative is in a shorter area of Alma Street. There are office limitations in both the working group plan and to the Staff recommendations. The office limitations would include no new office along Homer or Emerson for the entire length of those two streets within the SOFA II area. That’s in both the working group plan and the Staff recommendations. The difference is that also south of Homer in the working group plan, there Page 2 are general business office limitations being recommended. So that in no location, south of Homer Street could there be a general business office, a new general business office. It does allow for medical and professional offices south of Homer. That’s on the ground floor. You could have offices on the second floors but not on the ground floor. The Staff alternative is not to limit business office south of Homer so that you could have professional, medical or general business offices on the ground floor, subject to sizelimitations, which are up to 5,000 square feet maximum on a site and 2,500 of that being on the ground floor. So, it’s less of a limitation on general business office. Today, we are asking that you comment on the South of Forest Plan, making any recommendations that you would like forwarded to the Planning Commission and City Council. Roger Kohler is here to discuss the HRB’s review of the plan yesterday. And also [Allison Kendall] is here to go over the prototypes that were included in your packet that look at the 1.15 and 1.5 FAR altematives, So, she is here to assist with questions if you have them. So, with that, I would conclude the Staffreport. Chair Bellomo: Thank you, Lisa. Roger,.would you like to add? HRB Board Member, RogerKohler: Good morning, Board Members. The Historic Resources Board met yesterday and reviewed the same material, I think you’re looking at today. We had 4 items that we were going to recommend on to the Council. The first one has to do with the PC policy. The Board felt that if a historic building, with the ease of preserving a structure in the site might be better facilitated if a PC was available for that project, that it might allow for different setbacks, height limit, parking, that kind of thing. So the PC, we felt should not be automatically eliminated from the entire program and that at least might be an option for some of the historic sites on the project. We also felt that the parking ought not to be a defined limits when relating to a historic structure that if, in fact, it may be a preferred item to not have anywhere near the required parking to preserve a historic building. We just felt that putting in an exact number on there was a little bit limiting when it comes to some of the historic structures. Lisa has already commented about the seismic bonus. We felt that that ought to be transferred fight as well, when it comes to the historic structure that if you can be operating of a historic building allowing transfer of rights for that proj ect would help pay for the seismic upgrade of an older building. And we also, the last item was that we felt that when the projects are coming forth that the effective fear of involvement of the project might not be limited to just those immediate change in projects. In other words, a historic structure might be two or three properties down from a new, proposed project that we at least have the option to look at the impact of any proposed structure on a historic site in the SOFA area. And give our recommendation as to whether or not it ought to be reviewed by the combined HRB/ARB Board, instead of not being reviewed at all. Those were the 4 items that the Board came up with and that’s what we are going to pass on to the Council. Thank you. Chair Bellomo: Thank you, Roger. At this time, would Allison like to speak briefly to the FAR? Page 3 [Allison Kendall]: Thank you. I just wanted to show you on the drawings over here, some of the implications of the different development standards under the working group and the Staff proposal. The top illustration here is the working group proposal of 1.15 FAR. And one of the things we did in studying these through prototypes is try to identify what were actually the development standards that were limiting the amount of housing that would be able to be put on the site. So, I think what’s particularly interesting here is that the really controlling factor between the working group scenario of development standards.and the Staffproposal, which has the same FAR, the same maximum FAR of 1.15 is that it’s really the parking ratio that determines how many units can be put on the site. And on this sample site, which is probably somewhat larger thana lot of the sites that are available to be developed in the area, we can only get, for example, 9 units under this scenario and 11 units under the Staff scenario. And the only real difference between them effectively is the actual parking standard. Another thing that’s interesting to look at is that the availability of the PC scenario permits substantially more density on the site at 1.5 FAR. So we also wanted to reinforce that for areas along Alma, for example, and High, that’s a very important ability to provide substantially more housing units. In this case, the density can actually go up to potentially 42 units per acre if it was ¯ all affordable housing, for example, with the parking scenario that is not infeasible given the size of the site and the economics of development. And I’d~be happy to answer any questions if you have any. Chair Bellomo: I’m sure we’ll have some. Thank you. So we can return to the Board for some questions. Ken, would you like to start? BM Komberg: Thank you. I didn’t see in my packet, but is there any in the packet which indicates where the historic elements of the SOFA 1I is? Which page? Staff Lisa: Hopefully there is a map in your plan. I think it’s facing Page 20. Because this is a Draft, it still has a hand note on it and I think it says, Map, either 3 or 6, but let me look. It’s Map 6 and it faces Page 20. BM Kornberg: Those gray areas are the lots that have historic structures on them? Is that correct? StaffLisa: That’s correct. BM Komberg: And then you indicated in this the recommendations in the SOFA 11 that adjacent properties and properties across the street would also be included as requiring historic review? Is there anything left, I guess, is what I’m asking? Staff Lisa: It covers quite a bit and what you were referring to is the process. And currently, as written into the plan, the process for a review would call for non-historic sites that are adjacent to or across the street from historic sites to go through the joint HRB/ARB BOard. That would include quite a few sites because there are, as you noted, there are 30 historic sites and then there are going to be sites on either side and across the street from those sites that are not historic but Page 4 that how it’s written into the plan would be subject to an HRB/ARB review. The thinking being behind that is that anything that goes on, on those non-historic sites has the potential impact on the historic site. BM Komberg: For example, if you look at Ramona between Forest and Homer, would that entire block on the south side fall under that review? There’s one sliver parcel in the middle but it shows that there are two not subdivided parcels on both sides. So is that entire area would all be under the requirements of this? Staff Lisa: This is on Ramona between Homer and Forest? BM Komberg: Yes. On the south side of Ramona. You have that one very narrow piece of property but then you have two parcels on either side. StaffLisa: That’s right. The two parcels on either side would be subject to the ARB/HRB joint review as would probably the larger of the two across the street. BM Komberg: So, if you’re not part of SOFA II, you would still require the historic review even if you’re not on historic structure? Because the other side of the street I thought was not part of SOFA II. StaffLisa: The other side of the street wouldn’t be, so I’m sorry, the lot goes through. I was looking on the other side of Emerson. So, yeah, those that are not in SOFA II would not be subject to this. Those parcels on the, if you want to call it the north or the east side of Ramona would be subject to SOFA I review procedures. BM Kornberg: Okay. The second question I had was, is it unusual to exclude PC options in this kind of area plan as being requested by the working group? Staff Lisa: I don’t think it’s either usual or unusual. This is only the second Coordinated Area Plan that we have done in Palo Alto. And so it really is open for discussion. ~BM Komberg: Okay. Is there any description of the on street parking requirements as it relates to the different parcels? Staff Lisa: We currently don’t have on street parking requirements. We require all uses to be parked on site. There’s the discussion of how much parking should be provided on site but we have not included any on street parking to be allocated for on site uses. BM Kornberg: So, are you assuming that these are all going to be green or just unlimited parking around? Or will it be regulated according to the particular type of development? Staff Lisa: There has been quite a bit of discussion actually with the working group about increasing the number of green zones, limited time parking especially along Homer and Emerson as those are sden as the primary retail/commercial spines in the district. And that is something that our Transportation Planning Division is more than willing to consider and look at. So there Page 5 is a policy in the transportation section of the plan that calls for increased use of limited parking for commercial uses. BM Kornberg: The mission statement that’s included in the information that we received explained the SOFA II, calls for, it’s actually the vision statement. It says, "to preserve and enhance the eclectic nature of the area along with the.walkability and livability of the area." I think that’s excellent but to me, it’s different from what the rest of the many descriptions that I see which are asking for in adherence to particular styles. And that’s where I started to get confused because I couldn’t understand what exactly is the intent of the SOFA II regulations or recommendations are in terms of the historic elements. Because I see eclecticism a lot when I walk around SOFA II. But then if you take the historic structures, I’m trying to understand if you try to adopt only the 30 historic structures, whether you would end up with the same eclectic mix that you’re asking for in the vision statement. So, I!m really having trouble of trying to understand what the effort is. Staff Lisa: It is to preserve and enhance the eclecticism and to recognize that there are a significant number of historic resources in the area and not to necessarily mimic those styles or the characteristics of those buildings but to reference them in terms of massing and pattern, and maybe some of the features. But not to necessarily try to duplicate or replicate them, but to acknowledge and design into any new building something that would be compatible with the historic buildings. And, in fact, there is a compatibility standard that was included in the development standards that tries to define what compatible would be without limiting the style of dictating the style. So, there wasn’t an intent to dictate the style of a new building or an addition to an existing building. BM Kornberg: I guess that’s where I was having the most trouble with. I’m not sure how you enhance the scale of one of the structures or enhance the massing. What is that? What are you trying to do? I mean, that’s where I think we can have a lot of input is to try to understand architecturally, what kind of influence we can have in that area. Does "enhance the scale" mean make it the same or does it mean make it different or does it mean make it larger? Staff Lisa: I think it means improve upon it or which would include some modification, some change. I think when we talked about the word "enhance" it meant overall, not necessarily that you’re enhancing a particular building or you’re making it bigger but that you’re improving or making better something that’s already there. BM Kornbergl So, if it’s a good scale, make it better. And if it’s a bad scale, make it better? Staff Lisa: I suppose you could put it that way. BM Kornberg: Okay. And the same with the massing and the third was the character? ’[pause] Okay, I’m not trying to be picky. I’m just trying to understand what you’re after and what I’ve seen, the misinterpretation of what I think you’re may be after is that you end up with imitative architecture, and that’s where I hope this isn’t leading. And I’m worried that what the emphasis on historic is not the emphasis on eclecticism because I think what you see in SOFA II now is examples of architecture representative of the different periods that those projects were Page developed. And if we try to adopt something that’s similar to everything, in anything adjacent or across the street t~om these elements that are considered historic are supposed to resemble it somehow, or somehow do something in the same historic nature, whether it’s referencing it or enhancing it. I’m not really sure what you’re after. The best example of architecture’in historic zones that I’ve seen was some sort of the rows along the [camon] in Cambridge, England where you have these beautiful 12th and 13th century buildings and adjacent to them are glass steel, modem things which these things really stand out well and that really is a remarkable way to accentuate and enhance these. But I don’t know if that’s what you mean because that’s what I thin is the most, the contemporary or the best way to do it. Staff Lisa: I don’t think that enhancement in any way to mimic what is there, that there was an acknowledgement on the working group’s part that the resources themselves should be preserved to the greatest extent possible, and that new buildings should not detract from the resources so that they would fit or be generally compatible. So there wasn’t an intent at all to try and mimic the existing historic resources. BM Komberg: So, when you say, use roof lines or scale similar to, does that mean you want elements of the adjacent historic structure in the adjacent building? Or in any way, trying to influence the style of the adjacent building? Staff Lisa: Not necessarily trying to influence the style, but trying to create the same kind of a feel to the area, rather than mimicking the style. BM Komberg: I agree with you, but I don’t think it comes out of this. And I think it’s important that whatever we say, when you say the architectural design and styles of the new construction shall enhance the scale, massing and character, that it not be interpreted to be imitative. And that’s where I think this needs a better description because that’s what this commonly ends up doing, is that when you say you want to work with reference, then if somebody comes up with a design which is imaginative or inspirational, that person can think it fits in with the scale, but if it doesn’t have the dormers or the steep grooves, then it could be interpreted that that’s contrary to what the wording that you have here. Staff Lisa: So what I’m hearing is that a possible recommendation that would come t~om this Board would be that further explanation in the vision statement that this is not intended to be promoting imitative architecture or architectural styles? BM Komberg;: Yes. Staff Lisa:. Okay. BM Komberg: No, for example, I don’t think frankly I’d write buildings would fit in SOFA II according to the wording that you have here and I’m worried about that. I mean, I’m worried about somebody who’s a fine 20th century or 21 st century architect being excluded from doing work here. And I think that’s the way I interpret the writing that you have. And also, there’s Page 7 almost no reference here to sustainability and to the important influence of modem technology and architecture. Was that intentional or was that not considered necessary? Staff Lisa: It was not intentionally left out. If the Board would like to make that kind of a comment, we can certainly take that forward. BM Komberg: Okay, thank you. Chair Bellomo: Thanks, Ken. Judith? BM Wasserman: Thank you. I have a couple of questions, it’s kind of along Ken’s line of questioning. Could you, without going into too much detail, tell us how different or how similar is this plan to the SOFA I CAP? I mean, is it sort of a more of the same as it goes towards Alma, or is it really different? Staff Lisa: I’m actually going to ask John Lusardi to get some of that background since he was involved with SOFA I. But it is, the FAR’s are different than in SOFA I. StaffLusardi: Mr. Chairman and Board, actually the FAR is in the development in SOFA II is slightly less than what was approved under SOFA I. The SOFA I had a maximum of 1.5 in the multiple family district, the AMF district. So, this is slightly less than that. I think the greater emphasis with respect to SOFA II than SOFA I is there is an increase or much more discussion about the issue of compatibility in addressing the issue of the eclectic or the mixture of uses in SOFA II, whereas in SOFA I, it was really a re-development issue. It was with respect to re- developing the medical foundation and compatibility with the single family surrounding it. Here, I think there’s a greater emphasis on the existing environment within SOFA II, the mixture of uses and the whole issue of compatibility in how you address that in the context of historic structures, Homer Avenue as a retailquarter, that kind of emphasis is greater in SOFA II than was in SOFA I. BM Wasserman: Thank you. With respect to the Comp Plan, whatever happened to the concept of village residential? I don’t see that type of zoning in here at all? Staff Lisa: Village residential is a land use designation included in the Comp Plan. We don’t currently have a zoning district that is comparable to that land use designation. So it’s not. applied in SOFA II or actually anywhere in the City yet. So, we didn’t attempt to create that definition for this area. We’ll deal with that definition or address that definition as part of the Zoning Ordinance update. BM Wasserman: In terms of this joint review with the HRB and the ARB, is this envisioned to be the same type of joint review process that SOFA I went through? Staff Lisa: The way it’s written in this Draft that’s before you is, yes, for some sites. It would be a joint review for those historic sites and then those that are either adjacent to or across the street from historic sites, so that would be using the joint review that was created as part of SOFA I. Page 8 For non-historic sites that are not adjacent to historic Sites, those sites would go through the Architectural Review Board only. BM Wasserman: No, I was just referring to the joint review parcels. And that was a process where they were two members of each Board that reviewed? I just want clarification of what that process is. Staff Lisa: I believe it’s 3 members of each Board. BM Wasserman: Three members from each Board? Staff Lisa: Correct. BM Wasserman: In my very imperfect recollection, that was a less than wonderful process. From what I heard from various people, there was not. a lot of agreement on things. I was wondering if the Staffhad considered any kind of a training program before, any sort of joint review boards were instituted? Staff Lisa: We have considered that kind of a cross-training. That was something that the working group also felt strongly about. And that members ofboth Boards would benefit from that kind of exchange. BM Wasserman: I have a question about the PC. You said that one recommendation was not to have any PC’s allowed but that in order to do something different, you would have to have an amendment to the plan, and that that would go through the Planning Commission and the City Council. But a PC also goes to the Planning Commission and the City Council. What is the difference? Staff Lisa: There is a discussion about the policy framework that was included as part. of your Staff report. The members of the working group felt that PC’s were not necessarily consistent with the policy framework that was adopted in 1997. That in that policy framework, there are references to projects that don’t comply.with the plan needing to go through a plan amendment. It is Staffs position that ifPC’s are allowed as part of the plan, that an application that comes through for a PC is not necessarily inconsistent with the vision or the goals or the policies of the plan that they certainly aren’t meeting the development standards but that that can be assessed on a project by project basis on the project merits on the public benefit package. So there would not be a need for a plan amendment, there would be a need for evaluating the particular project. The difference in process is that for a plan amendment, public benefit would not be considered. The difference also would be that if any changes are made to the plan, they would be applicable area-wide, not just to that site. So there are some differences. BM Wasserman: Oh, that’s the major difference, I would think. I didn’t even realize that. Are you considering a review of the whole PC concept and process at this point? I think it maybe that people feel that PCs have been abused or it’s sort of a destruction of the zoning and not of real benefit. And so, if there was a review of how PCs were done, the idea of public benefit Page 9 being largely undefined at this point. I noticed in the plan that there’s substantial public benefit, there was a beginning of definition of what things would be accepted. Is this going to be kind of a city-wide look at PCs that will apply to this? Or is that specifically applicable only to the SOFA II CAP? Staff Lisa: The way it’s written into the plan currently as a Staff alternative would only apply to the SOFA II area. And we did attempt to better define at what kinds of benefits we would be looking for, and that included child care and open space and public parking and other community services. There is a parallel effort through the zoning ordinance update that will address PC city- wide and the rest of the City. What is written into the SOFA II plan currently only applies in the SOFA II area, however. BM Wasserman: With respect to historic properties, historic buildings and their adjacencies and the appearance that hardly anything in the SOFA II area is not affected, I don’t know what the constitution of the working group was. Is there a sense that the historic resources tend to govern the re-development of the area? Staff Lisa: The working group and I think there are a couple 0fworking group members here really did represent a cross-section of residence in the area as well as design professionals and property owners and business owners in the area. So there were approximately 18 people who were active in the working group. So there were really a cross-section of opinions. I think it was pretty generally felt that the area has quite a few historic resources that should be acknowledged and preserved. And that is part of the reason there is concern about not just the historic sites but what is next to and around the historic sites because they do have a great influence in the area. BM Wasserman: But if the Historic Resources Board is recommending that maybe even buildings two or three towards down be included in the joint review, that actually if you look at the map that means every property in the area. It gets subject to joint review. Now, that may not be a bad thing if there’s proper preparation from the group but in Kerfs line of questioning where you’re looking for compatibility and enhancement, it’s all very vague. And maybe a word like respect is what you’re looking for. Like don’t squash this building but build something that allows quality, co-peaceful, co-existence, you know. What I would like to avoid getting, (I will stop after this one and not get into too many comments) I would like to avoid turf wars in the SOFA II. Thank you very much. Staff Lisa: If I could also just explain and Board Member Kohler may want to talk a little bit more about the HRB’s comments, they made a recommendation that was called the potential area of effect be evaluated for each project that comes in. We need to look at the applicability of that potential area of effect. That’s a federally recognized term that means, any project that has a potential impact on a historic resource, needs to factor into its design that potential impact and mitigate any adverse impact. Now, the applicability of that requirement may only extend to those buildings that are on the National or eligible for the National Register. We need to check that. So, the potential area of effect isn’t necessarily every site within three blocks or three sites over. It changes, depending on what the project is what the site is. So, it’s something that we need to evaluate. So that was a recommendation from the Board, from the HRB. Page 10 Chair Bellomo: Thanks, Judith,.Ken. Drew? BM Maran: Would that potential area of effect, is it designated who is supposed to make that determination? Staff Lisa: If that recommendation is accepted by the City Council, Staff had recommended that the determination be made by our Staff, historic resources planner. The Board was recommending that if that determination is made by our historic resources planner that it be brought forward to the Board for confirmation. We would need to discuss the timing implications of that and what would occur if there is a difference between our Staff recommendation and the Board recommendation. So, we would need to look at process and the implications of incorporating that kind of a review. BM Maran: Is there a spokesperson from the working, group here today? Staff Lisa: I believe there are a couple of people here from the working group. I believe Dave Burbenic is here and perhaps Elaine Meyer. BM Maran: And is anybody appointed to.speak for the working group? Staff Lisa:. They are speaking as members of the working group but not as official spokespeople. BM Maran: Okay, thanks. In trying to sort all this, perhaps I could ask some questions that would help me understand it and may be simplify it a little bit. For example, a model project that comes before us in a couple of years when we resolve this definition, and what the differences are within the model project between the different definitions were different preferred definitions of the SOFA II plan. Does that make sense? Staff Lisa: I think in any event a model project would include a mix of uses that would probably have some retail and some housing, perhaps some other types of commercial use might be a personal service, but it would have a mixture of uses with the housing component. Now, the difference between the two recommendations is that under one, there would be more parking under the working group definition, there would be more parking and perhaps slightly fewer residential units. Under the Staff recommendation, there would probably be less parking because of its proximity to the train station and perhaps slightly more units. That’s a very general description but it would be a mixture of uses. BM Maran: Thanks, that’s helpful. So, given what we know of the SOFA I reviews and where we headed with that in terms of the way in which developers and landowners used those guidelines, what do you see, and this is perhaps a little too subjective. But I’m having trouble understanding what we’re really going to end up seeing in this neighborhood and we are in the neighborhood. What are we really going to see happening? What’s going to be the trend in development or the projected trend in development as you see it? Staff Lisa: I think there is the opportunity for mixed use development. I think there are probably some members of or some people who want to speak today who will have different opinions Page ii about this. But I believe it won’t be the same as SOFA I. I think that SOFA I had constraints definitions for what uses could be there via the development agreement. There are no development agreements in SOFA II. So I don’t think there are those same kinds of constraints. I do believe that you may see housing projects that come through as exclusively housing projects, not mixed use projects. I think there’s some opportunity for.that as the housing market gets better, changes, evolves over time. I think you may see some on the smaller sites, you may see some remodel and upgrade of existing buildings without much change to them but a remodeling and upgrade of them. BM Maran: Thanks, and I’m sorry for putting you on the spot. But somebody’s got to be there. What’s the primary issue as you see it? If you could simplify the PC issue, as a zoning issue and what does it really mean in terms of long-term impact for this neighborhood? Staff Lisa: I think the primary issue is seen by many working group members and probably many members of the community is certainty versus flexibility. And that if you have a PC, there is a certain amount of flexibility there that can be unknown. That’s why we try to further refine it in the SOFA II area to put a cap on the maximum FAR that could be applied for and to try and further define what the public benefits could be to provide greater certainty within that Planned Community process. So, I think that summarizes the concern. BM Maran: Thanks, that’s helpful. Within the discussions in general, have there been and are there discussions of how population is growing, what the demographic shifts are within the community and within the Bay Area and Peninsula in particular? Staff Lisa: We didn’t include a discussion of the demographics and those kinds of changes in the plan. It is anticipated that this would be individual to small family housing types that there would not be a lot of family housing, that there’d be limited impact on the school district because of thenature of the housing type. But we didn’t include an extensive discussion of that in the plan. BM Maran: And in terms of its SOFA II relationship to downtown and also to [Professor Bill], that’s sort of the link between those two neighborhoods, what’s the direction of these policies in that regard? Staff Lisa: It is a transition area to ease the transition between downtown and the neighborhood, the single family neighborhood. It is actually in the vision statement that the intensity of development in SOFA II is not intended to compete with downtown, that this is seen as a secondary area. It’s not intended to have the FARs, better allow downtown, it’s not intended to have the mass in bulk overall that’s allowed downtown, or the height. BM Maran: Thanks. Staff Lusardi: Mr. Chair, if I could just add to Board Member Maran’s question and also back to Board Member Wasserman’s question. I think it’s important with respect to SOFA II that the working group also had a great deal of discussion with respect to the longevity of this plan. They looked at this as not a development plan that happens necessarily tomorrow but over ten Page 12 years. And so, I think that’s an approach that I think is important for the reviewing bodies to look at that you can look out there what’s there today and envision what you may want there next year. But this is also a very long-term plan. And I think that’s part.of the focus of the plan. So looking at that context as opposed to SOFA I, which was looked at as a much short-term plan because we saw a development happening right away. Chair Bellomo: Speaking of long-term, John, Lisa, we’ve had some projects throughout the downtown and the neighborhoods that have come to us and occasionally the buildings under the subject property is deemed historic. What, in fact, would keep buildings from continuing to be, let’s say, historic in nature as time goes on? And how could that change the fabric of development? Staff Lisa: Once the building is deemed historic, what would take it off the historic list? Chair Bellomo: What puts it on? What puts the building on the historic resource? Because it seems that it can be discretionary internally. Staff Lisa: There are actually criteria that the HRB uses to evaluate the integrity of the building and if it has been maintained over time. And so if a majority of the original features and design are still intact, then it has a greater likelihood to be found historic. Chair Bellomo: So, I guess to answer my question, it might be that buildings can continue to be put on the resources list. Staff Lisa: Yes, yes, they can. There is a general eligibility factor of 50 years or greater. Chair Bellomo: Well, I guess, that’s bringing the point of that as time passes, things can hit that 50 year mark and/or sympathetically, these buildings can be put on the resource list. Staff Lisa: Once they hit the 50-year mark, they are theoretically eligible to be considered as a historic resource. But they would then have to be found to be consistent with the standards that would qualify. And that means that the original features and style of the building has been maintained. Many buildings that are over 50 years old have been modified during that time and would not be eligible for historic status. Chair Bellomo: A good example was the apple store, for example. In this region, there was a band of tile and there was some features that were deemed historic and they were preserved and the building had hit a 50-year mark and it was the [Burge Clarke]. And I guess my question is, the historic list can grow? Staff Lisa: Yes, it can. Chair Bellomo: Okay. The other point, did the working group have a chance to look at, in my opinion I guess, Drew used the word "model examples" of current projects, and I briefly wrote down a list of projects that we have recently seen keeping what we do know of the SOFA II guidelines during our review, conscious of those features. There’s 800 High. There’s 901 Page 13 Channing that we’ve just recently seen on a study session. The laundry French building was on the cusp, but certainly that was pulling into SOFA II, the High Street Forrest Building by [Genzler]. [Ellison]’s is a wonderful example of a newer building that kind of worked with the historic nature of that building. [Olie’s] was another design we’ve seen that I don’t believe is going through, but it was certainly a building that kind of mixed uses and looked at a lot of the things I’ve seen. So did the working group have a chance to dig into those designs and look at where SOFA went, or in fact, where SOFA II is going? There’s a parking structure down there. There’s a rhythm that’s changing very soon in the area. Staff Lisa: We didn’t pull out plans and look at specifics, but certainly there was an acknowledgement that the area has and is changing, that there are mixed use projects being proposed today under an existing one-to-one FAR. And I think the working group took that into consideration as they said, okay, we would like to continue that, what’s becoming a mixed-use tradition, and enhance it in that we’ll allow extra FAR for some additional housing. So I think they were taking a pattern that is developing and saying, yes, we agree with that mixed-use concept. We would like to see it used even more for greater housing opportunities. Chair Bellomo:~ Did Allison have the opportunity to look at those as far as form code goes as far as how you were reaching those FAR criteria? Allison: Sure. We did actually look at all of the projects that had been built in the area and some of the one’s that have been proposed, including the various 800 High projects and so on. And we looked at those particularly to find out how a developer or designer would approach the specific constraints of these sites in terms of the size of the parcel, the difficulty of providing parking of various economic sizes and types, to make sure that the prototypes we were developing were realistic and actually achievable as well as complying with the policy guidance and the plan. Chair Bellomo: I guess my question is did you find it useful to look at those forms as far as developing FAR standards? Allison: I think so. I think there’s definitely a wide variety of approaches to form. We do have a few examples over here. Chair Bellomo: Well your form code more speaks to a Summerhill type, at least a graphic one, more ofa Summerhill-type project than what we’ve been seeing in SOFA II. So I would say that the form code you developed was SOFA I where that’s the confusion lies for me. Why aren’t we seeing in a sense... Allison: Right. Well, just to clarify, these are illustrative prototypes and not necessarily guidelines or connected to any particular style. The idea was to really represent what would be one possible solution for the various types of sites. Certainly, particularly in the areas where you have higher density development, you could have a form that would be perhaps more industrial or contemporary in its character. Page 14 Chair Bellomo: I guess as a comment it would have been helpful to see some of those forms as we’ve been reviewing because we haven’t yet seen, we’ve seen many, a list of developments, kind of form code, or developments come to us, and we haven’t yet in SOFA II seen that type of development, though we definitely saw that in SOFA I, that type of form. I’m not sure. So that’s my question is maybe there’s an opportunity to show some of those buildings or forms to relate to certainly what’s kind of a direction built out there. It’s more of a comment. But would that be something, Lisa, that could be included? Staff Lisa: We can certainly try to get prototypes developed by the time this goes to the Planning Commission and certainly City Council, to show them maybe some other types of forms that could be built. ’ Chair Bellomo: I think that’s something that can be really helpful. Staff Lisa: Okay. Chair Bellomo: Those are all my questions. The rest have been asked. Any other questions? We,ll have some public comment. I have two cards and two speakers. The first is Carol Jansen, 575 Hawthorne, followed by David Bubenik, and we have three minutes per speaker. Carol Jansen, 575 Hawthorne, Palo Alto: Good morning, members of the ARB. My name is Carol Jansen. I live at 575 Hawthorne Avenue, and I am working with the 800 High Street Partners to develop a condominium project on the former Peninsula Creamery site. I’d like to make some comments since I was present at the last SOFA II meeting about the study over all, and particularly with relationship to the economic feasibility of that study. And that includes both the recommendations from the working II group and from the Staff. I think the fundamental question, because that was the original Council directive in terms of looking at both SOFA I and SOFA II was to facilitate housing and particularly redevelopment of certain areas for housing in that area. And so the one question is: Do we want housing? And I’d like to give you in the coordinated area of planned direction from the Council that’s in your packet here. One of the criteria and purposes is to analyze and consider the economic environment so that the planning process works in conjunction with the marketplace rather than independent of it. I think that’s critical because there was a lengthy discussion at the last SOFA II meeting about the economic feasibility, and one of the members of the working group, Steve Pierce, who’s in regular attendance, presented a pro forma analysis of the Staff recommendations up to a three-to-one floor area ratio housing project on the Bill Young Automotive Service site. It was just sort of a prototypical pro forma. None of those scenarios worked economically. They were all losers for housing on an 8,000 square foot lot in SOFA II. The only thing that worked economically was conversion of the existing building to some form of general business or office purposes. And so I think you need to know that there’s only been two housing projects that have been built in the last couple of decades. One is four units in association with 901 Alma, the other is the Palo Alto Housing Corporation single-room occupancy hotel. Page 15 That FAR, by ~he way, of that project ranged between 2.45 to 3.17, generally it would be 3.17 in the way that you count parking that’s semi-depressed. It is also built at 267 units to the acre as an SRO. The Staff recommendation, which is a higher recommendation I believe, contained on page 31 of your report, is to limit SROs to 50 units to the acre. So I think when you look at some of those numbers, and with the fact that you simply have not achieved housing in the SOFA II area, and there’s a need for a minimum of 140 units according to the former Council direction, it’s a question of are you going to achieve that with these recommendations, and particularly in light of the fact that there are no PCs permitted under both the Staff and the working group recommendation. So I just ask the question again: If you want housing, then do you believe you can achieve it with these recommendations? I believe you can’t. Thank you. Chair Bellomo: Thank you. Dave Burbenik followed by Kurt Peterson. David Burbenik, 420 Homer Avenue, Palo Alto: Good morning. I’m David Burbenik, 420 Homer Avenue, Palo Alto. I’m here as a SOFA resident, as a member of the SOFA working group, as president of Palo Alto Stanford Heritage, vice president of Community Strategies for the University South Neighborhood Association. It,s going to be a busy morning. SOFA is Palo Alto’s historic core and I believe a prime focus of its architectural and cultural heritage. It was where the first house.was built in the new town of University Park in 1891, where our citizens of Asian and African decent lived and worked in a less tolerant town, and it was Palo Alto’s workshop. And all that in nine blocks is becoming a vibrant residential commercial area now with a just-so urban feel. I think that’s a heady prospect. SOFA also stands a very good chance of becoming our city’s blighted area if mismanaged. I believe the SOFA process is a very heavy responsibility in that regard. The physical SOFA character is an organic eclectic that works, mixed styles and a spontaneous harmony much exceeding its parts. Nobody designed it; it occurred over the last century. But if we lose it, it cannot happen again. Modem development’s paradigms will not permit another SOFA. Area’s architectural character is a funky mix with a distinctive charisma, original Queen Anne Victorians, a genuine bungalow court, a neighborhood grocery, an amazingly intact row of teens’ and twenties’ commercial edifices, modem auto dealerships from the era when Cars were not mere commodities, a twenties’ gas station with actual visual appeal, relic utilitarian buildings serving new uses of today, a sizable affordable housing complex, and an artless PC bulk to remind us of what happens when city planning disregards neighborhood character and future. My vision is for SOFA to continue as Palo Alto’s prime architectural mosaic, it’s variety and vibrancy ever enhanced by new good ideas. My concerns are massing and scale. The SOFA urbanscape is low rise, open, human scale, and above all friendly. It’s what cities strive to create. We’ve got it now. I believe the working group plan maintains its character while permitting new development that will serve our city well. Page 16 And let me advocate for the working group plan. It is essentially a slightly revised version of a concept that Staff put before the group about two months ago. I have it right here. It reflects a government citizen process operating as it should. During itI felt that Staff and the Working Group were pulling together toward a mutual product, am therefore amazed by and much regret the so-called Staff alternatives and recommendations put before you. Staff showed them to the working group in a last-second surprise, and Staff now seems to promote them in opposition to its so-called working group concept. Not a good way to build citizen trust, but that’s for another forum. Please support the working group plan. It’s right for SOFA and it’s a Palo Alto processes ought to be. Chair Bellomo: Thank you. Kurt Peterson. I believe that is our last speaker. Kurt Peterson, 909 Alma, Palo Alto: My name is Kurt Peterson. I’m with High Street Partners at 909 Alma. We currently have a planned community zoning application in process in the SOFA II area, and again, as I said before, the real question here is do we really want housing in the SOFA II area. In reading the policy framework adopted by Council in 1997, two of the key goals are: Provide a significant quantity of housing, and make a determination of economic feasibility. Theworking group proposal eliminates the PC zone and is only a slightly increased zone from that which has been existing for the last 20 years. And as noted before, in the last 20 years we generated housing in only two locations in SOFA. One is the SRO and one is four units in another project, and both of those were PC zone projects. The Staff proposal allows for somewhat greater density with a limited PC zone option, but the only economic analysis that’s been completed to date on this has shown that the Staff proposal is not economically feasible. And in evaluating the SOFA II area and looking at the size of the projects, one of the issues I think everybody agrees upon is that in order to build housing at a density anything greater than FAR of one, you have to have underground parking. This requires a pretty good sized site, and in reviewing the existing parcels and the level of development, it’s our opinion that there are really only four sites in all of SOFA II that can accommodate underground parking and housing above. So the odds of getting any housing are very slim, particularly with these two options. So we basically go back to the question: Do we really want housing in the SOFA II area? If we do want housing, we need to retain the current PC zoning option so that some flexibility can be allowed to generate a project that is economically feasible, or increase the density in FAR limits in the current SOFA II proposal. Thank you. Chair Bellomo: Thank you. No other speakers, we can return to the Board for comments. Ken? BM Kornberg: First of all I.want to compliment Lisa and Staff and working group on all the work they’ve done. It’s really been a lot of very fine work here. I want to go back to the issues that I was concerned about in my line of questioning. It’s clear to me from my 30 years doing architecture that to enhance something you cannot make a copy of it. Page 17 If anything that diminishes it. And I think what Lisa says, which is they want to make sure that there’s not imitative work associated with the style or the design, should be put into the SOFA plan somehow. And we can work with you on the wording, but I would like to make that as one recommendation of the board. But if you have a Buddhist temple or a Japanese building, and you put another one right next to it, I don’t think that enhances the mass, the character, the style. If you put something opposing to it, very contrary to that, it’ll enhance it much more. It’ll certainly make it more distinct, more of a feature. And if it’s truly the intent to preserve the historic nature of the buildings in the SOFA II area, then I think we should make it very clear that it’s important that we use architecture which is very different from the architecture that’s there. And if that’s the route that you want to go, then I think we should work with you on that wording. I think it’s a very slippery path to say we want to enhance it, and not indicate how. And I would actually recommend that we not make references to architectural style at all if we want to preserve what’s there. But that’s another thing that I would be happy to work with you on as far as wording. I think it’s also important that what the working group member, Bob, said was that SOFA II occurred, it wasn’t imposed, and we need to be careful about that too. If we want it to be as fine a hundred years from now as it is now, if that’s what you want to preserve, then we should observe the same rules that were observed in the 20th Century and the 19th Century, and that we not go out of our way and tell people what they can and can’t do in terms of style and that kind of direction. And I think it’s important to remove any reference to "across the street" or "adjacent" in that context. I think if we start saying that we want things to be done in a certain way "adjacent" and "across the street," then we’re ~oing to lose what SOFA II is about. And so I would also propose as a member of this Board that any reference to historic, that we take out that requirement. Just delete "adjacent" and "across the street." Otherwise you’ve taken care of describing what you want to do for’over 90 percent of what’s there, and I think that’s a dangerous route for us to recommend. It’s hard for me because I don’t want to tell people what music they can play, what art the Commission Should allow there, and then tell them, however, the architecture shall be a certain style. Because if you want 19th or early 20th Century style there, and then you want the Art Commission to encourage public art, should it o,nly be public art that was done in the 19th Century? Shall we only play music of Rachmaninoff and no Mozart. I’m really not sure what kind of path we’re trying to push people. So I want to recommend that any reference here to style be removed. Otherwise I think we’re going to diminish the qualities there. Thank you. Chair Bellomo: Thanks, Ken. Judith? BM Wasserman: Thank you. I really appreciate Ken’s comments because now I don’t have to say it; I can go on to my stuff. On the issues that you brought up, I’m just going to dive into this. There was the issue of the PCs, there were actually three alternates here, and I actually come down in the middle, which I believe is the green one, in that PCs would be allowed only along Page 18 Alma Street with the FAR cap. But I do also strongly recommend that PC be very well-defined and the public benefits be well-defined, and that it not look like a zoning for sale auction. I also think that the height limit of 50 feet be limited to Alma Street as well, that there should not be offices on the ground floor. If we’re looking for a pedestrian friendly, active, lively situation, offices on the ground floor doesn’t cut it. Going through the document, in the DC section, I think the emphasis on scale, bulk, and mass, rhythm, and a fine-grained aspects is really the key here, and that Ken really has the number on not dictating styles. I think in policy DC 2, you ought to include paving treatments and public art in the list of things that enhance the pedestrian experience. In the design opporttmities, in the Gateway section, please include public art there. In pedestrian amenities, 4.10.6, don’t forget newspaper racks. In the lighting section, I think you need to really emphasize lighting for pedestrians as opposed to lighting the roadway. I think the lighting should really be small scale, low, deal with height and shielding and all that stuff. Oh, and in the landscaping, which only seems to tallk about trees and lawns, I think you should have some color in there too. .And the signage I think is an interesting start. But I actually think that you might add that consistency is signage is not required quite specifically. And then in the section on entrances, it seems to me there is an uncertainty in purpose. One sentence says something is encouraged, and the next sentence says it must lead. And I think when you go back through the language of this you should decide whether you’re going to require something or whether you’re going to encourage something. And if you’re going to encourage it, why aren’t you requiring it, and if it’s not required, are you going to talk about it. I think that whole area of wording, and if you go into the definitions when it says "shall" it means it’s required. When it doesn’t say "shall" it doesn’t mean it’s required, then that’s not the language you use. Winn will read this, right? Good, okay. In the section on driveways, I think the maximum driveways are way too wide. That’s my personal opinion. There’s another’ lighting section of 4.20.8 where it says "minimize glare.’’~ I think it has to say, "prevent glare." Not any glare at all. What’s a reverse vending machine? Okay, i’m not going to get into the definitions because that’s way too complicated. I think that’s the end of these. Oh, yeah. Please, please, please train thai joint review panel. I just think that that’s absolutely essential or we’re going to have large problems down the road. I think that this is really encouraging. I hope we’re going to have more area plans. I think that’s how this city grows and works in these smaller areas, and I hope we have another chance to look at these things. Thank yOU. ChairBellomo: Next [inaudible], Drew? .BM Maran: Thanks. I’d like to thank the Staff and Lisa especially, also everybody in the working group, and retroactively everybody in the SOFA I committee. It’s a tremendous task, so I’m going to try to push through some of these comments quickly. Page 19 In terms of format, having been on the SOFA I joint HRB/ARB board, I also agree that it is not a successful, or should not be used again. The main thing that I found as a member of that board was that there were two very different perspectives coming in, and there wasn’t what I felt enough of a basic unity of intent in terms of the difference between reviewing architecture and preserving old buildings, and the separation of those intents was so great that at times I felt that we were working in different directions, so I would oppose that as a format for future reviews. I think the separate review by HRB and ARB are important and x)aluable in the upcoming SOFA II applications for development. I also want to salute the proposal that includes creating models of future development. And I think that in that light the only way we can really look at the effect of our guidelines and the impact of our guidelines is to take real economic models and work with them. This isn’t to say that if a developer is not going to earn a tremendous profit from a project that we should then not create a guideline. But it is to say that we have to look at partnerships with developers and with homeowners and landowners as an important input source for guidelines for development. And we can actually have the reverse effect. We can actually make more profitable good development with the proper guidelines, and I believe that’s where we’re headed with this set of guidelines. In terms of preservation, I’m starting to dread now that some of the buildings around us are going to turn 50 years old pretty soon. I never realized that was such an important point; it kind of reminds me of that ten-year cut offin a marriage. You have to really lose it or go on before you hit that cutoff or you’re in big trouble, and I’m afraid that we’re going to be in big trouble pretty soon around here, perhaps even including the building we’re sitting in now. So in that light I think also that I definitely support what Ken said about not including buildings adjacent to or across the street from historic buildings. I think that becomes a really dangerous slippery slope that we’ve already been sliding on in the SOFA I reviews. Lastly this issue of sustainability and green building. I think that since we’re getting very specific in this set of guidelines, I’d like to make very specific recommendations and see that there are very clear and decisive guidelines in terms of green building and green design in the SOFA II. I appreciate that it’s difficult because there are not federal or state regulations that go beyond let’s say Title XXIV or the environmental impact reports, and we’ll probably get into that in the next review that we do also. But I think it’s ironic that it’s perfectly legal for us to use let’s say lumber that comes from a clear cut or from a forest that was completely devastated and therefore mined an entire community or ecosystem and led to perhaps economic devastation in an area. And I’m not just talking about in rain forests in the Third World, but in Oregon, Washington, and Northern California. In other words it’s perfectly legal for us to use that material, to specify that material, but we do environmental impact reports on a very local and sort of micro-community basis, and those issues don’t get addressed. It’s also legal to use non-renewable energy, gas and oil and nuclear energy and water that’s pushed through hydroelectric dams, and yet we do the environmental impact reports and they don’t acknowledge those issues. So I think it’s time, as we’ve been moving forward in Palo Alto on the issues of sustainability, I think it’s time to start writing them into our guidelines and Page 20 ordinances for a relatively small development area such as this one. And I’m happy to contribute to that if it’s needed, but I think that we really have to address it in a more specific and more concrete way. So specifically creating energy use guidelines, material, recycling and salvage guidelines for the buildings that are going to be demolished, minimum specifications for toxicity levels on new buildings. All those things are possible as guidelines, and I’m getting very specific because this clearly is an area that seems to have been set aside or ignored throughout these guidelines, so I’d like to add that. Other than that I salute the efforts here. I think this is an exciting and really energetic potential for this area and for the whole city, and I really look forward to having another great guideline, or another neighborhood that’s enhanced by the City’s participation in working with its community. Thanks. Chair Bellomo: Thanks, Drew. I really feel like the coordinated area plan being developed here is really, encourage all of the efforts set forth by Lisa, yourself, and the working group. You’ve heard a lot of good comments; I’m going to try not to repeat them. I’m going to just say a few things. One, I like these two words, "walkability" and "livability" with the highlight on "livability" in today’s world. And I think that’s really a key point. I think there is technological advances and progress that we need to place ourselves in and not to discard the past but to enhance the prese.nt and the future. I was a member of the HRB/ARB subcommittee, and I think more than anything the biggest problem was that there was a predetermined stylistic urban plan set forth. And we really didn’t have an opportunity to look at the style. We really just were left with some details. The height I think went back and forth through Council on an appeal, two or three feet. We didn’t have much say on the design, which was fine. That was how it was set forward., But I would like this coordinated plan to reflect I believe the new found approach. And those were my questions as so much as the form code. My fear is that a form is delivered and is expected. I think we have to be careful. We speak to style; we look at images, and they’re powerful. I think there’s pretty much a unanimous, at least feeling on the Board here, so I don’t feel alone, that certainly imitative, derivative, or some clue of a style from a form code be delivered, and certainly there are many ways to approach blending. And we’ve certainly seen that really successful; I used Ellison’s as an example. Feel it’s for an office building on Alma it’s a very clever techniques of a historic fagade with an infield building beyond it of modern materials, and it fits in and it works. And there’s other examples, and I believe that it’s important to encourage this coordinated plan with a form code that reflects some of the model, not only developed, but soon to be developed buildings that this board has dug into around all of those issues. And hopefully that those could be included into these model examples. I’d like to suggest that the joint review be reconsidered and talked to the chairperson of this board and the HRB to know how that works. Because it had some problems on what we are reviewing. This board tends to review, we get down to that maybe a service delivery node can affect the design, and how in fact does it work as a whole. Where I believe the HRB is looking at different things. So it really does, I think Judith mentioned, that we would need a educational Page 21 development. I think we sort of get educated by working together, and that’s sort of a long process. So I think that needs to be considered very carefully. As far as the PCs certainty versus flexibility, I always advocate flexibility and looking beyond the box. And I know that there’s some concern on PCs bulk, mass, density. But certainly I believe that there can be something with careful wording as Judith puts it. There could be a PC that developed that could create these unusual lots to become more than what we think they can through an enhancement, a public benefit. So I’m in support of some sort of PC certainly along Alma, certain sections of High Street, and as far as height goes, it could lead back in a bit towards High, depending on where. Also there might be some consideration of this adjacency. I think adjacency or across the street, certainly we always look at streetscapes. I believe a streetscape is the device that you really look at these buildings, the mass and scale working together. And I know that we always request that, so those are things that I think also can be included. There were some questions on housing, and that’s again I believe this area does need housing; how do you obtain it with appropriate densities is, I fall back again to the PC and the flexibility for certain joint shared rights, open space, and how you create the density needed. Those are most of my comments and I believe at this time you’re receiving those comments and we’re not voting on anything. Staff Lisa: We are receiving your comments. If you could make it in the form of a motion and it may be a generalized motion to forward these comments on to the Planning Commission and City Council, that would be appreciated. Chair Bellomo: Okay. I know there was even comments on lighting. How general or how specific would you like us to dig in? Staff Lisa: That’s entirely up to the Board. If you would like to be specific, that would be great. Then you may not want to restate all of those items. You may want to make a generalized motion to incorporate all of the comments if you’re in agreement with those comments as a board. Chair Bellomo: I believe there’s consensus and agreement. BM Kornberg: I agree. BM Wasserman: I haven’t heard anything I disagree with. BM Kornberg: I guess I would make a motion that the comments that were proposed today by the board members be presented to the City Council as representative of what we would like to communicate. Chair Bellomo: I have an idea that the Staff could assemble the comments and the subcommittee could review those comments for clarity, and that could be a good way to achieve a very specific, bulleted line item on every comment. BM Wasserman: You could have my annotated plans. Page 22 Staff Lisa: That would be fine. And I can attempt to summarize these and put them forward to your subcommittee for review. [comments not miked] No, you don’t get full minutes, so I’ll summarize them and put them through your subcommittee. Chair Bellomo: Thank you. Thank you, Lisa. BM Wasserman: I second that. Chair Bellomo: All those in favor? All: Aye. Chair Bellomo: Thank you very much. Yes, and add note. You can put it in our packet and we obviously can all read it in our next packet. We will take a 5-minute break and return for our next item. Chair Bellomo: Let’s see, proceed to Item 4, New Business, 4219 E1 Camino Real, Hyatt Rickey’s Hotel and Residential Development (99-D-2, 99-ARB56, 99-UP-24 and 99 EIA-9): "ARB will review and comment on selected sections of the Draft Environmental Impact Report (DEIR). This project proposes the redevelopment of a 15.84-acre hotel site with a new 320- room hotel facility (275,000 square feet) and 302 multiple-family residential units (eight buildings). The Planning and Transportation Commission will hold a public hearing to accept comments on and review the DEIR only on April 24, 2002, 7:00 p.m., and will be held in the Council Chambers. The public is welcome to attend this meeting. Separate public hearings to comment on the project and planning applications will be noticed and held at a future dates." Staff?. Staff Lisa: Thank you very much, Chair Bellomo and Commissioners. I would just like to very briefly introduce the proj ect Staff from the Staff City perspective. On my right is Paul Jensen, who has been the project manager managing the EIR preparation on a daily basis. And then on my far left is John WagStaff from WagStaff Associates, who authored the environmental document. And then I think you all know [Winn Furth], our senior assistant attorney. And then also in the audience is Rick Williams, who created a couple of the alternatives that are in the document as a result of the joint planning process between the neighbors and the applicant. And we’ll review that in more detail later, but Rick is the design consultant who created some of those alternatives for the document. I did also want to draw attention to a letter that’s at your places from Winn, making a correction to the Staff report where it says that there has been a conclusion on whether or not a conditional use permit would be required for increased use or intensity of use on the [Wilke] Way driveway. Actually we have not made a determination on that. That is still under consideration. So we did want to make that correction publicly for the record and for you as board members. That particular issue is not something that you may have many comments on or that is a particular design issue, but since it was in your Staff report we wanted to correct that for you. So with that I will introduce Paul Jensen. He’s going to give a brief background and then John WagStaffwill go over some of the content of the document. We will not be presenting a full Page 23 review of the document. We did have an educational briefing earlier this month to do that, and we would like to give the Board as much time as possible to comment and have public input as well. The project applicants are here today should you have questions of them, however this is not really a hearing to discuss the project or the project merits, it’s a hearing to receive comments on the environmental document. And Winn would like to make one comment as well. Thanks. Winn Furth, Senior Assistant Attorney, City of Palo Alto: I just wanted to add that the applicant’s attorney has pointed out to me that in our letter correcting one error I generated another one. There’s a reference to where the residential traffic would enter and exit this site. It’s not primarily the Wilke Way driveway; it’s primarily the Wilke Way Central Charleston and Southerly E1 Camino Driveway. So I will now stop and hope not to generate more errors. Paul Jensen: Good morning, my name is Paul Jensen, and by way of background, the Hyatt- Rickey’s project encompasses 15.84 acres of land located at the intersection of East Charleston and E1 Camino Real. In mid 1999 planning applications were filed for redevelopment of the property. The site is currently developed with a 344-room hotel. There are 47 buildings on the site, mostly low rise, and there’s one mid-rise, six-story tower situated at the eastern end of the site. The redevelopment program proposes a new 320-room hotel complex contained primarily in two buildings close to E1 Camino Real with 302 multiple-family residential units proposed to the rear. Site access is proposed from E1 Camino Real, Charleston Road, and an existing Wilke Way driveway. Following completion 0f the application in November 1999, Staff prepared an initial environment study which concluded that the project had the potential to result in a number of environmental impacts. Subsequent to that we published what is referred to as a notice of preparation, which allowed the public and agencies 30 days to comment on this recommendation and also to comment on what should be included and studied in the EIR. And as a result of that process, the comments that werereceived were used in formulating the scope of the EIR. During this initial process we also got a number of.requests to include a study of specific site plan alternatives. And that is why we have a large number of site plan alternatives in the EIR, including an all residential development of the site, an all hotel development of the site, and actually looking at the property as two separate parcels with one parcel containing hotel development and one parcel with residential development. And as Lisa had mentioned, during the EIR preparation process, we initiated a series of meetings with the project sponsor and representatives of the neighborhood association for the purpose Of developing one alternative that could conceivably address all interests. We brought in Van Meter, Williams, and Pollock, the City’s urban design consultants that are working for the City on the South E1 Camino design study. And they developed some concepts, but no consensus was reached on any one plan among the members of the group. So consequently we directed several alternatives to be developed with each alternative addressing the individual group interests. At this point I’d like to turn it over to John WagStaff, and he’ll provide a summary of those sections of the DEIR that we would like comments from you on. But before I do so, I would like Page 24 to note that we have received about 25 letters of comment on the DEIR and the project so far. The public review period closes next Wednesday, so we do expect more comments. Thank you. John Wa~Staff: Good morning. I’m John WagStaff with WagStaff and Associates. We prepared the EIRjust before you, under the supervision of your Staff. I’ve been before this group once before when we prepared the EIR for the Varsity Theater project. I’m not sure whether any of you were on the Board at that time. As Paul indicated at the initial part of the process we had a scoping exercise where we came up with some 12 environmental categories that warranted focused analysis in the EIR. I gave you each a handout which I’m using for my presentation and perhaps can guide you as well. And on the first page of that handout the 12 categories are listed. Of those 12 1 think four are pertinent to your charge. Land use is one, and aesthetics factors is another. Transportation, parking, is a third. Biological resources, and specifically tree removal is another. So I will quickly summarize our key findings in those areas. With respect to land use and visual factors, those two sections of the EIR are highly interrelated, and the conclusions are overlapping. The key conclusions are, first of all, with respect to building height, it was determined that the City’s 35 foot maximum height limitation for residential districts would apply in this mixed use case, would apply to both the commercial and non-commercial components of the project. On the other hand the applicant’s interpretation of your ordinances is reflected in the project design, which includes 50 foot building heights, which are inconsistent of course with this EIR finding. So to mitigate that particular inconsistency the EIR does Call for redesign of the project to reduce maximum building heights to 35 feet. Otherwise either a variance or a rezoning would be necessary. With respect to land use compatibility and visual compatibility, those are the areas that are overlapping, the EIR found that the project would have a beneficial impact on the visual character of that segment of E1 Camino Real, and the architecture, the shingle style, still being roofline character of the project and the lack of large parking areas in front in combination with a uniform landscaping treatment along the front, the project would serve to meet your E1 Camin0 Real guidelines calling for visual cohesiveness and harmony along that segment. On the other hand with respect to the residential edges of the project, the north and east edges of the project, one along Charleston Road, and the other along Wilke Way, the EIR does indicate a significant adverse impact concern. Incidentally we did compare, as you have noted, visual simulations, photo montage, computer-generated visual simulations of the project from various key vantage points along E1 Camino Real, Charleston Road, and Wilke Way, which are blown up here and mounted on these boards. So the principle finding with respect to those edges was that the, well with respect to the project in general, was that the FAIR increase from what is now around .32 up to about :88 would have a significant effect on the land use pattern in.the area, and in particular the two and half to three story residential buildings, the seven residential buildings along the northern and eastern residential edges would have compatibility issues with single-family residential on the opposite sides of those streets. And to mitigate that impact the EIR calls for increasing a concept that’s Page 25 already reflected to some degree in the project and that is the idea of reducing density, a transition of density if you will, from the center of the project to the edges. And the EIR calls for increased stepping back of residential intensity, reduction of the building footprint and height at those residential edges, and in fact those themes are reflected in three of the various nine land use alternatives in the alternative section. The first three site plans to the right of the;number four on the wall reflect that concept, and all three of those alternatives, two developed by your urban design consultant, one by the applicant, show single-family residential units along those edges to increase project compatibility with residential on the opposite sides of Wilke and Charleston. With respect to transportation and parking, the EIR did indicate that the project, that in the future the Charleston/Alma intersection will be operating [inaudible] F say around 2010, .and that the project will contribute significantly to delays at that intersection. And the EIR describes some physical improvements to that intersection to reduce those impacts to sensible levels including the addition of a right-turn lane on the eastbound approach to the intersection. But then the EIR further notes that in doing that there would be significant secondary impacts associated with that improvement, which would involved either moving the bike lanes up onto the sidewalk in order to maintain your travel lane standards, or widening the road. In both cases the impacts would be significant of the mitigation. The other alternative that’s identified in the EIR if widening is found to be unacceptable, are reducing the residential intensity of the project. And there are two residential intensity reduction alternatives described in the EIR. One is if the current access configuration is retained, the two driveways on Charleston, the two on E1 Camino, and the one on Wilke, the EIR indicates that a 40 percent reduction in the residential unit total from 302 down to 181 would be necessary to mitigate that Alma!Charleston Road impact. Alternatively if access is limited just to E1 Camino Real, to the project, then that reduction would be 20 percent, 300 units down to about 242. Similarly on the Charleston Road easterly driveway access to the project, we indicated a significant impact associated with left-turn movements in and out of that driveway. To mitigate that impact our traffic engineer called for prohibiting left-turn movements in and out of that driveway through the installation of a median at that segment of Charleston. And the analysis also indicated that median would divert some of the exiting traffic onto Wilke with significant impacts on the Wilke Way residential environment, applying your general plan tire index criteria. And the bottom line really in the EIR is that to mitigate that Wilke Way impact and the Alma Street impact, one of the two reduction alternatives that I mentioned, would be necessary. By reducing the impact on Alma you would also inherently reduce the impact on Wilke to less than significant levels. With respect to parking the EIR does indicate that the proposed parking provisions may not be adequate to accommodate some of the special events, ten to 12 special events per year that would be conducted at the hotel. And to address that concern, a major concern of the neighbors, the EIR calls for a comprehensive parking management plan prepared to the satisfaction of ARB and the Planning Commission, and your traffic Staff. And that would include a very detailed shared parking description, how the parking was to be shared between the hotel and residential during Page 26 these special events. The traffic management’s plan would need to include a ten percent margin of available parking at all times, provisions for valet parking during special events, and most importantly a parking monitoring program for the first three years. The EIR goes into some detail about this parking management plan concept, parking monitoring plan calling for monitoring during high attendance events, and describing the monitoring responsibilities and the oversight by the City. And the need in combination with that to provide some design contingency in the project design that would allow additional parking to be readily supplied if indicated by the monitoring such as an initial parking deck, architectural or structural detailing that would permit readily the addition of a parking deck if the monitoring showed that that was warranted. At least two of the alternatives, the first three alternatives do show such a parking configuration where a parking deck could be added. Incidentally, your code would require about 1100 parking spaces if these two part components of the project were looked at individually, the hotel and residential. The applicant through your zoning provisions is asking for a reduction to 962 units given the shared parking opportunities of the site. So this is the issue. Lastly I think with respect to tree loss, there are currently about 360 trees on the site, and the ordinance as you know also has protections for heritage and so-called protected trees. Of the 362 trees some 130 to 160 would be displaced or damaged by the project construction. Ten of those would be so-called protected trees, so the EIR calls for a tree removal and replacement plan again to your satisfaction, that has tree replacement ratios that you and your arborists accept, and ongoing replacement and monitoring and maintenance requirements, some requirements for redesign to your satisfaction to avoid as many of the protected trees as possible. ¯ And then finally, as Paul indicated, we do have an alternative section that is unusually comprehensive for an EIR, that includes nine land use alternatives and five access alternatives, and again, many of those alternatives, particularly the alternatives calling for reduced residential density along the edges incorporate quite a few of the mitigations in the EIR, and illustrate how those mitigations would be implemented. There are also a number of alternative access configurations that are looked at and compared including access limited to E1 Camino, access limited to E1 Camino and Charleston only, with right turn only in and out of Charleston. Another one similar to that but with all turn movements in and out of Charleston. And finally an access alternative that combines the southerly E1 Camino driveway with the adjacent Elks projects, or Elks site, in anticipation of future development there. So that is a very quick overview. I’d be happy to answer any questions. Obviously any questions that you have or any comments will come up today from the public we will be addressing in the final EIR. Thanks very much. Chair Bellomo: Thank you. We can start with questions. Judith, would you like to begin? Page 2 7 BM Wasserman: Thank you. I have never reviewed an EIR before,so I’m maybe completely out to lunch .on a bunch of stuff, So excuse me, but I see that you had this list of criteria that you reviewed and none of them included sustainability. I don’t know if you were here for our previous hearing just before this when Drew brought up the concept that we review just local ’ impacts but we haven’t, in the City policies you compared the project with the comprehensive plan, but the City also has a sustainability in construction policy that you didn’t look at. Do you intend to look at these other policies as well? You looked at the trees that are coming down on the site because we have a tree ordinance, but you didn’t look at other policies that the City had. John WagStaff: We did look, as you noticed the policies in your adopted comprehensive plan as well as your E1 Camino Real design guidelines and your zoning ordinance regulations. With respect to the sustainability policy I frankly am not aware of the status of that policy, whether it is in fact a general plan policy, but in order to treat all projects equitably we do apply the general plan as our guide. If you request us to and Staff deems it appropriate, we can certainly expand that evaluation to look at your sustainability provisions and how they apply to this project. BM Wasserman: Okay, that sounds good. In that direction there was a letter from the Water District, that discussed issues of drainage and sewage and flooding. So what happens to the water that comes into the project? Did you also look at where the water was going to come from that the projectwould need to serve these large number of residences and, see, this almost doubles the population on the site. Like there’s about 300 hotel rooms now, and there would be 300 hotel rooms and 300 residences, so they all take showers whether they live there only for a day or whether they live there all the time. John WagStaff: The answer is yes. Section 11 of the EIR does include an analysis of the project’s water demands and the ability of the City to meet those demands with respect to both domestic and fire-flow demands. And we did not identify a significant deficiency in that area. Things were determined to be adequate through your public works Staff. BM Wasserman: So that must have been one of the sections we didn’t have to read. John WagStaff: I did not summarize that section for you today, nor did I tell you about our evaluation of storm drainage which is also included. Our team included a civil engineer who did peer review, the project drainage plans and made comments and recommendations with respect to that issue. BM Wasserman: E1 Camino as a whole is .being looked at now by a design team and a technical advisory group, and they’re coming Up with thoughts about E1 Camino specifically, and that area is one of the tough parts of it because there are so many parcels that are available for redevelopment down there compared to places that are really built up. Did you look atthe possibility of coordinating efforts between the E1 Camino design team, and this is sort of in the line of looking at the cumulative effects of environmental impacts which would include traffic, and traffic impacts always include air quality issues. Trying to get this all under the rubric of ¯ EIR and not something else. Page 28 StaffLisa: We did as part of the joint effort between the project applicants and the City and the neighborhood association have Rick Williams, who is the primary consultant on the E1 Camino Real design guidelines, come into those meetings and actually the alternatives that were developed as part of those meetings were put together by Rick with input from the various parties, so they are aware of and part of those design guidelines were incorporated into those alternatives. BM Wasserman: Okay, because it’s always a tough thing to design a project knowing that there are existing guidelines and also knowing that those are going to change any minute. So people are working both sides of these guidelines now? Staff Lisa: That’s correct. And as Rick was just pointing out the streetscape project which is slightly, again, slightly different, yes, was also incorporated into the overall review. But yes we are attempting to incorporate all of those elements. BM Wasserman: Is there any difference in the impact of the project whether the residential units are sold or rented? Because it said somewhere that the applicant intends to sell them eventually. Staff Lisa: That’s not strictly an environmental concern, however, we have informed the applicant if they intend to sell these units, they need to apply for a condominium map, which is essence a subdivision application in order to, and that needs to occur prior to a building permit so that it is known whether or not these would be condominium ownership units or not. BM Wasserman: But it doesn’t have an impact on the environment in the when? Staff Lisa: The data we used doesn’t generate different numbers for example for traffic or expected household size, depending on kind of tenure, depending on whether you lease an apartment or own a condominium or sublease, or lease a condominium that somebody else bought. BM Wasserman: Thank you. i guess that’s what I was trying to get at. This is a weird question but in your evaluation of the aesthetic impact, you made a point that the craftsman shingle style with the swoopy roofs was going to look really cool. And I don’t really understand that because this is an Eichler neighborhood, why did you think that craftsman style was going to be a benefit? John WagStaff: Actually the broader finding is just the visual interest of the building, and it’s scale and it’s relationship to the street is consistent with and represents an improvement with respect to E1 Camino Real, the old design guidelines for that segment. We did have some positive things to say about the shingle style given the craftsman-style heritage of this sub- region. So it was more of that broader craftsman-style heritage that we were .considering in making that statement, rather than the more recent Eichler design style of the residential units off E1 Camino Real. BM Wasserman: And I just wanted a clarification of the parking versus numbers of units mitigation of traffic impacts, mitigation of the amount of required parking on site kind of thing. Page 29 That always seems to me to be an equation where the fewer units means less parking, means less traffic, so the total impact of the project gets smaller and more manageable. We ran into this for example at Albertson’s where the size of the grocery store, as the grocery store became not the issue, but just the amount of parking required by the size of the grocery store became the issue. And they made the grocery store smaller, needed less parking, were able to manage the site better. Is that the sort of thinking that went into some of these alternatives, or was there some other formula that you used? John WagStaff: Well if I understand your question, one of the.obvious ways of addressing a parking problem is to reduce the demand by reducing the size of the project. However in this particular case in a sequence situation of this nature, there is legislation, state legislation that indicates that we are not to reduce residential density as a means of mitigating such an impact, that we are rather to be looking at the project as proposed by the applicant and to see what needs to be done to address that project as proposed. If there is no other physical means of mitigating that parking impact, then we can turn to reducing the actual intensity of the project. If that gets to your question. BM Wasserman: Yeah, actually that’s very helpful information. John WagStaff:~ And with respect to the reductions that I mentioned for the Alma, that’s why I brought up these reductions for the Alma/Charleston intersection. If it is determined by the City that the physical improvements identified in the EIR for that intersection are unacceptable because they do not meet your standards with respect to not compromising bicycle activity along the Charleston Road, then you have a legal basis to begin to reduce the project intensity for that particular impact. I might also say for parking, again we’re talking about the difference between what your code requires, if the uses are looked at individually, which would be a total of about 1100 spaces, versus 962, which is proposed, given the intermixing of residential and hotel uses and the opportunities there for shared parking, and the suggestion actually in your own ordinances that shared parking is something that you should consider. So the question is on a discretionary basis is the reduction that they’re suggesting going to work or is it too much. And that was the struggle, to try to identify definitively whether or not the combination of parking provided was sufficient. And the indications were that it may not be, and therefore this parking monitoring program has been strongly recommended. BM Wasserman: And the problem seems to center around the special events, big conferences, and things like that? John WagStaff: Yeah. BM Wasserman: Thank you very much. Chair Bellomo: I have a note here that a speaker would like to speak before she needs to leave. I think it’s appropriate that she would do that. [Heather Trossman]. I just want to remind the public speakers they have three minutes. Come forward please. You have a maximum of three Page 3 0 minutes. We have about 20 speakers, but we’ll do you, return to questions, and then proceed into the public. Heather Trossman: Thank you so much for allowing me to speak before I have to leave. My name is Heather Trossman-Cushlin. I’m a Palo Alto resident, and actually I grew up in Palo Alto as a little girl and care very passionately about the quality of the city. I’m also an architect practicing on the California Avenue Business District of Palo Alto and a member of the Palo Alto Chamber of Commerce’s Government Action Council. Although I am not necessarily representing it in these comments. I would like to express strong and enthusiastic support for the general design concept of the Rickey’s Hyatt project as it is currently proposed. I am confident that this project will be an asset to, and an encouraging precedent for the South E1 Camino Real corridor and for the Palo Alto community as a whole. Naturally the project site plan, which must negotiate a complex series of land use and contextual issues is at a preliminary stage. There are certain specific issues that I feel could be better addressed. These include.the way in which the front of the hotel meets both the important intersection of E1 Camino Real and East Charleston and the entire E1 Camino frontage. A very challenging design problem and the unfortunate presence of proposed on-grade parking at the southern portion of the E1 Camino frontage and conventional strip mall fashion. However, I’m confident that these issues can and will be skillfully addressed in the next phase of design by the projects very distinguished design team. I encourage the ARB to look favorably upon the proposed project density, both that. of the hotel, 320 rooms, and multiple-family residential units, 302 apartments. If ever there were a site that offered the opportunity for appropriately increased density, this one is certainly it. Surely this site cries out for the comprehensive planned schools for the South E1 Camino area, mandating a well-designed, compact, vital multi-neighborhood center with diverse uses, one with pedestrian-friendly design features, such as sidewalks, street trees, onsite parking, public spaces gardens, outdoor furniture, art, and an interesting architectural details. If we cannot promote these things with a density appropriate to a site bordered by two major arteriats providing public transportation in a city desperate for adequate affordable housing and in a portion of that city, Southwest Palo Alto, yearning for its shareof convenient retail and service uses, then we are failing in imagination and a commitment to the important urban planning ideals in which we as a community profess to believe. The Rickey’s Hyatt site has the good fortune to be bordered along the two arterials along East Charleston and Wilke Way by tall, mature trees. Chair Bellomo: If you could finish up, your three minutes is... Heather Trossman: Oh, absolutely. I’d like to add three questions to the record and then the rest of my comments will be in this letter. How can the DEIR say that this project will be visually incompatible when it also says that you could hardly see it from Charleston Meadows or the other neighborhoods? Why doesn’t the DEIR recognize that two-story buildings are proposed along Wilke Way when there are two-story buildings in that very neighborhood? Why doesn’t Page 31 the DEIR point out that virtually all of the trees that are now treasured were planted by and for the hotel and that the new trees would be there in the future. Thank you.. Chair Bellomo: Thank you. We’re going to return to Drew. No questions? Ken. BM Komberg: I wanted to continue a little along the line of the E1 Camino Real questions that Judith was asking. What were the proposals that Rick Williams might have made that were incorporated? We were given a presentation at a retreat which a lot of different standards were being proposed for E1 Camino Real, and I’m not really sure what the City’s ambition is for that stretch and how that would fit into the overall development guidelines that are being presented. StaffLisa: The proposals that Rick put together had to do with the design guidelines for private property along E1 Camino Real, so he can speak to those. Those were the ones that were incorporated in the altematives, and these guidelines are proposed, they’re not adopted yet. We have guidelines along E1 Camino Real that are from 1979, which some of those concepts are still relevant, some are not, and so the ones that Rick would be speaking to are proposed at this point. BM Komberg: Does it include this zoning that’s being proposed on this particular site? Is that consistent in the new? StaffLisa: The zoning is not proposed to change on this site. The application that’s been submitted falls within the existing zoning more or less with some notable exceptions as pointed out in the draft EIR. But the zoning is not proposed to be changed on this site. BM Komberg: What is the vision for this area regardless of this project? Are you looking for 50 foot high buildings lining that portion of E1 Camino? Are you looking for one story buildings, five foot setbacks? Staff Lisa: I would refer to Rick to talk about those proposed guidelines. Rick Williams: Thank you very much. Rick Williams from Van Meter Williams Pollock. We worked with both the Staff, the applicant, and the adjacent neighborhood representatives on the development of this, and we also evaluated somewhat the original proposal. And there were .really about four or five different main features that were incorporated into a couple of,the alternatives that we developed to try to illustrate the spirit of where the City’s comprehensive plan was going, and a number of them addressed E1 Camino Real. Particularly one of the emphases was to attempt to place more building frontage directly up to the street on E1 Camino Real, active uses, retail oriented uses. That was both at the intersection with Charleston where looking at the internal configuration of the hotel we recommended that the retail be placed at the comer as part of the conference center rather than internalized within the hotel. That was within the working floor plans. And then also to. place instead of surface parking along the frontage of E1 Camino Real, but to have retail commercial uses in the front along El Camino Real as well as possibly second story commercial uses or office uses above it in a small way, and then have the surface parking in a Page 32 limited extent directly behind it, and then also the incorporation of a parking structure as an alternative to the amount of surface parking that was provided in the original application. BM Komberg: So the original application and what the draft environmental impact report really isn’t based on your recommendations, it’s based on the proposal itself. And these alternatives derive from some of the studies that you did of the proposal. Rick Williams: That is correct. BM Kornberg: Because it seems inconsistent to me with the things that I heard at the retreat a year or so ago that this would be a two-aisle parking lot along about 70 percent of the frontage, and I also assumed it would be buildings mostly, and so there’d be more activity than just parking spaces. Rick Williams: And you can note on Alternatives 2 and 3 there up on the wall that that is in fac’t the way it’s oriented with really the one open face to the project that isn’t completely building lining E1 Camino Real being what has been envisioned as a fairly grand entrance to the hotel that would be really a landscape accent to kind of mark the entry to the hotel, but that buildings would be the primary frontage. BM Kornberg: I need to disclose that I had a meeting with the architects representing the applicant and also received a phone call from one of the community group leaders, and in the meeting with the architects that was one thing I asked them about, whether parking was essential for the success of the retail elements that they were proposing along that E1 Camino frontage. And they seemed to think it was. But it’s something that may be inconsistent with what the guidelines are. Thank you for your presentation. Rick Williams: If I could just address one other issue very briefly, and that was something that will probably come up in the future, and that is the issue of the aesthetics of the hotel. And our goal was not to do anything but develop the site plans really, but we have discussed a number of times with the applicant that without thinking of it stylistically that a more urban-style building and less of a chateau-Style building along E1 Camino Real may be more appropriate and more consistent with the eventual.guidelines developed. That is not trying to develop it as a style, but that of a more urban type of building along the E1 Camino fringe might be more appropriate and be considered later. BM Kornberg: On Figure 7.2 of the Environment Impact Report, Mr. WagStaff, could I please ask you was that generated by your office or who generated those images, those renderings? John WagStaff: Yes, the EIR team generated those images using digital information electronically transmitted from the applicants architect. But the renderings were prepared by our team. BM Kornberg: On the top image which indicates existing you have about 20 cars in a lot that looks like it takes about 20. And then on the proposed you have about eight cars or nine cars in a lot that takes 200. And I think it has a major difference in the impact. And when you indicate Page 33 that there’s a positive impact from that photograph, I think you’re neglecting a rather major component of what that frontage is going to present, and that large parking lot is significant. I also want to agree with Rick that getting on to the visual elements and whether this is indeed an improvement, I don’t think an anachronistic element there is an improvement. In fact I think if you look at the context of that particular project in relation to the things that are going to be there in the next 20 years whether it’s automobile dealerships, it looks very out of character to me, and I don’t know why that’s considered an improvement that’s something that should be so out of context, not developed with particularly orientations of either the traffic patterns or the architecture should be considered a true improvement. I had a sort of a general question that I’m not sure who could answer. Is your net assessment that this development would increase or decrease the property values of real estate immediately affected by this project? John WagStaff: That’s a financial question you’re asking me, and we are specifically limited in our scope. Our mandate by the state is not to evaluate fiscal issues in an EIR, so it’s not something we addressed. BM Kornberg: Does Staff get involved in questions like that? Staff Lisa: We do not evaluate that. BM Komberg: Okay. Just curious. I had another question, maybe Winn or Lisa could help me with this. When I was in the presentation by the two architects, the first thing that seemed to me contrary to the ambitions of the City and possibly to a coherent design°team, was that these two sites were treated.distinctively because of the ownership of the two different properties. Is there some mechanism similar to what is done on the Stanford Industrial Park where leases can be treated, in this case it’s a 69 year lease that is on this particular parcel, so that the project itself could be tr.eated as one site? In other words a conditional use permit that would last for69 years that would allow the site to be treated as one entity rather than two separate entities? Winn Furth: I think it takes a code amendment. What we do at the Stanford Research Park is the reverse. We have one big parcel and we treat smaller lease sections as sites for development analysis. In this case we have multiple parcels but functionally two with separate owners of the two on the side. Our code is quite specific about how it defines site, so I think we would have to have a code amendment that would let us treat a parcel that was under common right to use, tenancy, for a period of years in order to do that. If we had that provision, then we could do that. BM Kornberg: Is that difficult to do? Is that a technicality or is that an act of Congress? Winn Furth: It takes five votes of the City Council. BM Kornberg: It’s something I propose because you see it in the proposed scheme in many different ways as you look at the circulation and the architecture. My first thought was of hotels that I’ve seen in other urban areas where you have residential suites on different floors of a hotel, Page 34 and it’s seamless. You’re not aware that there are people living there in ~iddition to people who rent, in addition to people who come there for single night occupancy. And I think that would be a very nice way to treat this thing. Winn Furth: So you’d like to propose that as a mitigation or an alternative that we might consider to get better results when we do some of these impacts. BM Kornberg: Yes. Thank you. I had a question about Wilke Way. When you see the current line of trees along Wilke Way, to me it seems like a barrier to efforts in major developments to integrate projects with the neighborhood. And that barrier I think is very important to the residence on the eastside of Wilke Way because they see it as protection from what a large developer can do to a piece of property. But I see it as more as a barrier that long term is going to keep these neighborhoods separate, and I wondered is there any reason why we couldn’t look at that as something that’s more malleable than the way the proposal’s been treating it, and substitute those trees also in ways in which we could make the two sides of that Wilke Way seem like it’s more balanced and part of the same neighborhood. And then how is the Environment Impact Report treating that? Was it treating it as something that is important to keep or something that could be... John WagStaff: The EIR does not treat that issue specifically. It’s kind of implied in some of the alternatives that show single-family residential along that edge. But even in those alternatives, the single-family residential, I think in all cases is oriented inward away from Wilke Way. It’s secondary internal residential lanes rather than on to Wilke Way. So the EIR does not include an alternative that really opens the site up to integrate it into the Wilke Way neighborhood. I think we were staying away from that because the intent of the alternatives analysis is to identify mitigations of identified impacts, and that gets into a whole new area of policy that we would want your guidance and direction on. BM Kornberg: I though Alternatives 2, 3, 4, and 6 were much more integrated as far as the way they worked with the environment, and it seemed to me that the plan, the scale, the massing, the message, and really what the identity of the site was clear from those schemes than it was from the proposal. And I wondered, did you address that at all? In the areas that I read, I didn’t see it brought up. But when you look at the site as developed in the Schemes 2, 3, 4, and 6, there seems to be a coherent message that you get as you go through the plan, and there isn’t in the proposal that I’ve seen from the applicant. John WagStaff: I think we simply stated that those alternatives would have a better visual relationship to Wilke Way than the others, but we didn’t get into details with respect to design relationships, neighborhood relationships, that perhaps you’re looking for. Chair Bellomo: Couple of questions. Are there any specific requirements for this development for open space? John WagStaff: There are specific park requirements that are addressed in the EIR. Your park requirements indicate that a project of this size, residential units, would warrant about a one-and- Page 35 a-half acre neighborhood park, and that can be provided either onsite or with [in lieu fees], and three of the altematives incorporate a neighborhood park of one-and-a-half acres you’ll see at the comer of Charleston and Wilke, on three of the alternatives there is a neighborhood park incorporated. Chair Bellomo: The proposed number one scheme, does that propose open space? I guess I just don’t see it on the edges. I do see it on Alternate 2 where you have on Wilke and Charleston there is an edge park, but.on the proposed plan, I just don’t seem to... John WagStaff: Are you referring to like a standalone park-type open space, or open space integrated within the project? Chair Bellomo: I think standalone park. John WagStaff: No. Not under the current proposal. Chair Bellomo: So what you were speaking to is general open space, the total amount of open space. When you spoke of in lieu fees, what was that? John WagStaff: I was talking about parks. With respect to your open space requirements within a project and that level of development review I defer to Staff. Staff Lisa: There is a discussion of the 30 percent open space that is required as part of the RM 30 zoning requirements, and so, yes, it was analyzed as part of the project alternative. And I think Paul has some details on that. That is separate from the park demand or requirement. So the project as proposed does not include a park, but it includes the open space required, which is private [talkover] It’s common usable open space. Right. It can be a number of things. Sometimes it is passive open space with tables and chairs for people to sit. Sometimes it’s active open space. But the concept is that it’s common and usable for everyone who lives on the site. Chair Bellomo: Because I do notice oia Alternate 2 that there is a scheme that shows a comer node of open space which the gesture is not park then. It’s just trying to include the open space in a comer node for community obvious use, intemal!extemal use. Correct? Staff Lisa: It would be part of the common open space requirement. It wouldn’t be dedicated public park. Chair Bellomo: With a development like this it’s based on the existing zoning, correct Lisa? This is not aPC, doesn’t go there, though it feels like a PC. Staff Lisa: It is based on the existing zoning. There are some areas as noted in the draft EIR that don’t meet under Staff’s analysis zoning requirements, but the intent is to be considered under existing zoning. Page 36 Chair Bellomo: So certainly a developer could enhance a public benefit for a site this size. They could certainly show amenities that go beyond zoning requirements to pull in the community at large. Staff Lisa: There wouldn’t be anything to prevent that. Chair Bellomo: I think in an effort of time I’m going to end my questioning and get to some of these speakers that have been patiently waiting. So I think I’m going to do this. Any other questions? Okay. We do have approximately 20 speakers, and I’d like you to certainly all need a chance to speak to this. If there’s a chair or a neighborhood representative that can consolidate some of the thoughts, that would be good in the effort of time. But we will start. You have a maximum of three minutes, and let’s begin with our first speaker, and I’m going to name the speaker and those who follow so you can. be prepared. The first speaker is Betsy Allen followed by Philip Smaller. Betsy Allen, 4186 Wilmar Drive, Palo Alto: Thank you, and thank you for allowing me to speak because I do have to leave. My name is Betsy Allen. I live at 4186 Wilmar Drive which is right offArastradero across from Turman in South Palo Alto. I have lived there for 28 years. I think the question here today is will we or will we not continue to protect the viability of our established neighborhoods. We’re not speaking of just one neighborhood with this project, we’re speaking of eight neighborhoods: Walnut Grove, Charleston Meadows, Green Acres I, Green Acres II, Barron Park, Palo Alto Orchard, East Meadow, and Ventura. We’re also speaking about a school corridor and a commute corridor. We have five elementary schools, two junior high schools, two high schools. We have seven private schools that use this corridor, and we have access to five different parks in the City of Palo Alto. We have also the potential development on or near CharlestordArastradero Road behind Crown Plaza, 22 houses plus a hundred condominiums, 689 Arastradero Road which has just been sold for development of high density condominiums, the Courtyard on E1 Camino and Los Altos Avenue, the possible Elks Club development, large sites of land between E1 Camino and Foothill on Arastradero, apartments already being built on E1 Camino, possibly 304 units on Stanford land, 2755, 3606, 4102, 4146, 4131, 4143, 4315, to 4329 E1 Camino Real already identified in the housing plan for the City and the future development on San Antonio Road. So what’is acceptable for our one zoned neighborhoods in the Hyatt Rickeys DEIR? Project Alternative 3, City Option B, identified as environmentally superior. I have written you a letter which is enclosed in your packets, but the hotel size of 320 hopefully fewer, building height 35 feet, 108 residential units, elimination of all access from Charleston Road and Wilke Way. Access only on E1 Camino Real for safety, Charleston is not a Palo Alto designated truck route. E1 Camino, San Antonio, and Page Mill Road are. This Charleston!Arastradero school and neighborhood corridor from Highway 101 to 280 with it’s access to Foothill Boulevard, Page Mill Road, Stanford University is a prime candidate to become the Oregon Expressway South. Limiting this project would send a clear and unequivocal message of the City’s future intentions. Thank you. Page 3 7 Chair Bellomo: Thank you very much. Philip Smaller followed by Rex Garr. Philip Smaller, 4155 WiNe, Palo Alto: My name is Philip Smaller. I live at 4155 Wilke in Palo Alto. In reviewing the draft EIR we found it does not adequately address the impact of traffic divergence during high usage periods. To appreciate the full impact of 302 new apartments would have on a geographically limited, small neighborhood likeCharleston Meadows, the EIR needs to consider that the blocks in this area have 20 to 22 homes along their, length, therefore adding 302 new apartments would create the equivalent of 15 blocks of new homes. A driveway on Wilke would create the opportunity for a large percentage of the new residents’ cars to impact the adjacent surrounding quiet streets. A backup of cars on Charleston between Wilke and Alma would undoubtedly result in eastbound cars using, such streets as [Edly] to reach Alma via Park. Northbound cars would cross Charleston to Wilke to reach West Meadow and then turn left to E1 Camino or fight to reach Alma..In any event Wilke looks like it’s going to have a significant increase in cut through traffic. And remember, the source of this traffic is the equivalent of 15 blocks of single-family homes. The draft EIR also failed to address the reduction in automobile traffic flow that would be caused by additional residents living in the project; residents become pedestrians as well as drivers. Anyone who has waited for a pedestrian light to change on Charleston knows how trafficflow is slowed while pedestrians cross the four lanes. Therefore the backups on Charleston which happen right now can only be magnified if the project is allowed to proceed with driveways on Wilke and Charleston. We conclude that the project as currently planned is too big for the area. And even if the number of units is reduced, no entrance or exit on Wilke or Charleston should be allowed. The equanimity and desirability of our community should not be held hostage by the need to maximize the profits of the Hyatt Corporation. Thank you very much. Chair Bellomo: Thank you. Rex Garr followed by Dennis [Lupiccolo]. Rex Garr: Hello, thank you. After three hours I really appreciate you folks, what you have to listen to. I’ve never been to one of these meetings before. It’s terrific that you’ll listen to all this stuff. I came today to talk about the size of the project, which I’m really against. I’m not against the project as a development. I know they’ve got to do something to improve their property. You have to do that as a business enterprise. However, it’s just too big, and I find that my concern was voiced in this thing that I just found here today, April 18, the Staff Report, where they say on page 21, they’re talking about transitions and street levels I guess, but I think they’re concluding remark is very meaningful to me anyhow where they say, "the recommended mitigation is to redesign the project, in this case to improve scale transition along the edges." I won’t pretend they’re talking about the whole thing, but I feel that way about the whole thing because I’m concerned primarily about heights here. I wanted to talk about heights just for one more minute. Page 3 8 In the DEIR 313 where they do list these heights, I don’t know about the definition, the zoning ordinance, they explained it to me here. I just know when I look at a wall or a building I see how it’s big or it’s not big. And I’m concerned about the heights that I see in the second column on 3. This is on page 3.35. There are two of the heights that are only 26 feet/27 feet. Eveiy other one is above certainly the 35 foot limit with several being 52 feet. Now they’re talking about going to a ridgeline, so maybe that’s to be ignored in our architectural consideration, I don’t know: But to me that seems very high. Only one other thing I’m going to talk about. That is there’s another table, 5.5 here. And actually the accompanying drawing, this is on page 526, a drawing that shows the proposed buildings inserted into the surrounding neighborhood. And then on table 5.5, they’re talking about how the neighborhood has one to four stories, which is terribly misleading. I mean the only four story building we have here, you’ll see in the figure on the facing pages here, little. building, Dinah’s Court. That’s essentially a three-story building with an underground parking, which I just went down to see this morning because I said, what four-story building do we have around here"? So really basically we have essentially a two-story neighborhood. The Elks Club, I’ll mention just one more thing. The Elks Club shown here, this will lead to the south of the proposed development in the figure here on page 527, they show two squares here, both labeled C for commercial, one apparently a two-story building, which is true, that’s the Elks Club. There is no other building. That other C is not there. There’s a swimming pool there..I don’t know why they show a three-story building. Chair Bellomo: Thank you. Dennis Lupiccolo followed by Peter [Staulking]. Dennis L.upiccolo: Good morning. I’ll be very, very brief. I just wanted to comment on the aesthetics. I understand that not everybody really agrees on what they’re seeing here and whether it’s this or something similar, it has to be a pleasing improvement over what is currently there. So it’s really a modem hotel, housing has got to be a plus/plus. And that’s it. Chair Bellomo: ThankYou, Peter. I’m sorry. This is Peter Staulking followed by Mark [Schafer]. Peter Staulking: My name is Peter Staulking, and I’m director of catering at Hyatt Rickeys in Palo Alto, am responsible for selling the hotel. And as you know the hotel business is very competitive out there, and we’re anxious to move this project forward, put up the modem facility that represents the City of Palo Alto. The Hyatt Corporation also provides all the services and benefits that go .along with that to the local community. So I’d just like to .say that. Thank you. very much. Chair Bellomo: Thank you. Mark Schafer followed by Jessie [Delapena]. Mark Schafer: Good morning. Thank you for the opportunity to speak. I want to say right upfront I’ve not been involved in a forum like this before, so I apologize if any of my nervot~sness comes out. Page 39 My name is Mark Schafer, I live in Palo Alto. I wanted to take a moment to address the parking issues that I’ve read in the EIR. It indicates to me that currently the hotel has situations where we are actually running out of parking spots and have been forced to direct people onto Wilke Way and into the neighborhood parking at the Elks Lodge. It has been my experience since I’ve been involved in the operation, almost a year now, that that is really not the case. But what happens is our Customers, like myself and others, prefer to have convenient parking that’s close to our end destination, meeting room, or social function that we’re going to. And what will happen is folks will park there because they’d rather be steps away from their destination than what can seem like football fields away when you look at some of the parking spaces that are always left open on the facility, but that are unfortunately located in one far comer or one far end in a more isolated spot at the end of a 0ne-way, curvy, hard-to-kind-of-find location when you come back out of your function late at night. It is also my clear understanding that the new facility will provide convenient, centralized parking that will allow everyone, no matter where their destination is on the property, to be steps away and will eliminate the desire that they currently have for parking in the areas that are on. Wilke Way and the Elks Lodge. But again, one last comment is that in my time here we have not mn out of parking spaces. It is rather an issue of convenience. Thank you for your time. Chair Bellomo: Jessie Delapena followed by Bob [Glazier]. Jessie Delapena: Good morning, everyone. My name is Jessie Delapena. I’m the hotel controller. I actually started working at Hyatt Rickeys in July of 1979, and through those times there are many changes, and one of them is we do not have enough below market apartments. My son just graduated from college in Santa Clara and would like to live in Palo Alto, but he cannot afford it. So I do support the project. And also Hyatt Rickeys just since 1998 has paid occupation tax totaling about 7 million dollars. So just information. Thank you. Chair Bellomo: Thank you. Bob Glazier followed by [Carlin Otto]. [comments not miked] Okay. Carlin Otto followed by [Deborah Drew]. Carlin Otto: My name is Carlin Otto. I live in Palo Alto. First I’d like to address a piece of misinformation that was communicated to you reading directly out of the DEIR about water distribution systems. It says, "the existing eight-inch water main along E1 Camino would adequately serve the existing proposed hotel only. However, the new multi-family residential units will require increased water distribution capacity and will require construction of a new water distribution system, and this has been identified as a potentially significant impact." So please do read the EIR and don’t just depend on other people telling you the facts. Okay. I would like to speak to you about Section 18 which is the alternatives. The draft has identified 40 significant negative impacts for this proposed project. Of these seven require a project redesign in order to eliminate or mitigate the impact. These seven are: 5.1, 5.2, 7.1, 8.1, 8.7, 9.10, and 15.2. Many of these fall in your area. The other 33 ~impacts could be mitigated and are said so in the EIR by smaller things such as median strips or screening. For example of Page 4 0 the alternatives number 3 eliminates three of these seven unmitigatable types. Alternative 6 eliminates two of them, that’s two out of seven. None of the draft’s alternatives reduces all or even a majority of these seven unmitigatable impacts. This is a serious flaw in the draft. The intent of presenting alternatives in EIRs is to demonstrate how a project could be fixed or redesigned so as to eliminate the negative impacts, or at least reduce them to below significant levels. None of the drafts impacts do this. The final EIR must include some alternatives that cause significantly fewer impacts, maybe six of the seven or seven of the seven on Palo Alto and the adjacent neighborhood and streets. At least one should create no significant impacts. I want to know how can this project.be designed in order to have no impacts. Is it possible? If this cannot be done, the City must conclude that this project cannot be built without causing grossly significant negative impacts on the City. I have also submitted a list of inconsistencies in Section 18 in my attempt to analyze the section it was hindered tremendously by an enormous inordinate number of inconsistencies. You can’t even determine whether a particular proposal has access on Wilke or not, or whether it has heights of 35 or 50 because there are many, many inconsistencies. Please get this fixed before the final EIR. Chair Bellomo: Thank you. Deborah Drew followed by Herb [Greeman]. Deborah Drew: I have comments that will probably take three minutes, but there were a couple of questions that were raised and I think I’d like to address those very briefly in a sentence or two because I have information that wasn’t presented in response to the questions that a couple of the ARB asked. May I do that very briefly? With regard to the trees that Mr. Kornberg, he asked a question about the trees. I just want to point out that there’s special zoning there that was created to provide, the trees are a part of a special zoning that was created to provide a visual and physical buffer for the neighborhood, and that’s important to understand, that it’s specific zoning that we’re dealing with. It’s not just that the trees are there and can we work around them, but I want to make sure you know about the specific zoning. It’s called a landscape zone. And then Ms. Wasserman asked a question and the EIR consultant replied about a statute that can in some instances affect whether you can reduce the number of units. That really doesn’t apply here because the project has to comply with ~he Comp Plan and if it doesn’t comply with the Comp Plan, that is an area in which the number of units would have to be reduced. So, if you’re following me on that. The Comp Plan specifically requires adequate on-site parking so he raises something that would not be a barrier to reducing the number of units if you need to do that in order to have on-site parking. And then the only other thing I want to point out is there is an attachment to our submittal. A letter from somebody in our neighborhood regarding the instances of on-site parking overflow. I mean parking flow into the neighborhood. A man from the Hyatt said that it hasn’t happened with in a year. This letter refers to a March 22nd date and I also saw this. Hyatt personnel were lined up with a few yards between them with flashlights at night directing a snake of cars all the Page 41 way from E1 Camino through their property, out the Wilke Way driveway and into the Elks lot for overflow parking. They were lined up at short intervals. I don’t like to hear misrepresentations like that to a governmental entity and that really boiled me. Okay, I’m ready, I’m sorry. Chair Bellomo: You have about a minute more. Deborah Drew: No, I need 3 minutes. I’m sorry, I wouldn’t have made those comments ifI wasn’t being clear that I was hoping that I have 3 minutes. May I? First, a little background. The Planning Department gave Hyatt advanced notice of its failure to comply with the Zoning Code, ARB standards and Comp Plan and letter is dated February 11, 1999 and April 23, 1999. It advised Hyatt to change its plans prior to filing for approval. Hyatt shows to make no changes at all and, therefore, the EIR is analyzing a plan which Hyatt has known all along cannot be approved. I’d like to address the subject of fuzzy Math. The DEIR assumes the project should be treated asa Mixed Use under the Zoning Code. We disagree because there’s no real integration between the uses and the possibility of future subdivision makes it clear this is not really one project but two. Even if it were Mixed Use, the DEIR goes too far in using the Mixed Use concept to recalculate density, FAR and open space in ways that make no sense and are very misleading. For example, the DEIR states that the FAR for the housing component is .48 when in fact, it’s 1.07. It states the project contains 19 units per acre when it actually contains 39.7 units per acre. And it states the housing component has 37% open space when it really only has 20 or 22. And now, I’d like to talk about the DEIR’s analysis of compatibility and visual impacts. Our homes are one and two stories on 6,000 square foot lots with generous setbacks between them. Hyatt proposes a near unbroken line of high density apartments along the border with our neighborhood. They are 3 stories high with taller parts extending even higher and are arranged in 8 blocks, many units long, deep and wide. They are totally incompatible with our neighborhood in height and footprint. For small projects, transition may be less important because there are fewer impacts to buffer against. However, the Hyatt project is so large it would overwhelm and destroy the small scale and quiet feeling of our neighborhood. For such a large project, the only effect of mitigation would be a buffer of single family homes of similar size on similarly sized lots. The DEIR underestimates the compatibility problem and is wrong when it states the landscape zone would provide adequate screening to mitigate most of the visual impact. Please look at Figure 7.10 from the DEIR because you need to understand why it would not provide mitigation for the visual impact. The landscape Zone is fairly narrow. It has two rows of alternating trees. It’s not a thick grove which could fully block the use of the project. The fence is likely to be gone in the future.- I know many people on the Planning Department just don’t want it there. There are large gaps between the trees leaving the buildings exposed, about half of the trees will be eliminated and the proposed driveway would leave a gaping hole through which you could clearly see and feel the project. The DEIR fails to address the only real mitigation which is a buffer of single family homes. Page 42 Chair Bellomo: Thank you. [Herb Greenman], followed by [Bob Gillespie]. Herb Greenman, 293 Tennessee Lane, Palo Alto: Herb Greenman, 293 Tennessee Lane. I would like to speak about the report regarding open space and trees. The Draft Report does not have a [S.S.] of projects non-compliance with open space requirements. Hyatt’s proposal design include a park. But the project would have to provide 1.4 acres of parkland for the estimated 713 residents to maintain the City’s park standard of 2 acres of neighborhood parkland per 1,000 residents. The Draft Report says Hyatt .could mitigate the lack of adequate, parkland than [in lieu fee] that such a fee is not true mitigation because the park wouldn’t be built elsewhere since there’s no land available, The report’s calculation of 37% usable open space is not correct because it double counts hotel gardens, walking paths, and other hotel features towards the open space requirements for the housing units. The gardens should have their own open space. Imagine, parents allowing their children to play in public hotel gardens without the hotel guests coming and going. In addition, the Report impro.perly counts hotel recreation facilities such as pools or fitness center as kind of facilities when they will be available only to the residents who pay membership fees. The Report does not adequately assess the impact of the destruction of trees for the project. It was said before, Hyatt wants to cut down 50% of the trees on the site. That’s 136 to 148 mature trees. Hyatt proposes planting new trees that even had a 2:1 ratio, those new immature trees will not compensate for the large mature trees that are lost. Hyatt should be required to leave most of the mature trees in place. Among the trees that Hyatt proposes to cut down are 9 protected oak trees, and one potentially protected redwood. Protected trees should not be cut down unless it’s clearly dead. The report fails to offer any mitigation for destroying these trees. And in fact, there can be no mitigation. The focus is on specific trees but it doesn’t address the impact on the grove itself. When you destroy a large number of trees, you destroy the cohesiveness of the grove itself and the healthy and thick grove is essential to any attempt to minimize the visual impacts from the project. Also, an independent assessment of the tree impact is needed. Thank you. Chair Bellomo: Thank you. Bob Gillespie, followed by Lane Liroff. Bob Gillespie; [Woodglen] Drive: Good morning, I’m Bob Gillespie, 1 live in [Woodglen] Drive and I’m considered a neighbor. I’m here this morning to address several points about parking in and around the Hyatt project. First, the DEIR fails to full address the issue of an adequate parking, as well as the issue of the overflow parking that would result, even more than it does now on my street and other surrounding the Hyatt property. Hyatt seeks a 13% reduction in the amount of property that would otherwise may require by the Zoning Code. This would include parking for both the hotel and housing on a shared parking theory. The CEQA guidelines provide that inadequate parking is a, per se, significant impact. The Comp Plan also requires the City to "protect residential areas from the parking impacts of nearby businesses and to discourage parking facilities that would intrude into adjacent residential neighborhoods." Page 43 The DEIR fails to address the feasibility of the shared parking arrangement. There is no analysis of the frequent number of evening and weekend events. And as a neighbor, I have observed many more than the 10 to 12 a year that Hyatt claims. There could be no shared parking for these evenings and weekend events because the residents are home during these times occupying their own parking spaces. The DEIR also accepts the feasibility of valet parking but no analysis where the cars would be parked.. Hyatt cannot rely on the valets using nearby residential streets for valet parking because they are legally required to provide adequate on-site parking. They cannot rely on the availability of the Elks lot because there is a high likelihood that the Elks will redevelop their land. Also, the DEIR’s suggest mitigation of a 3-year monitoring program is totally unacceptable. Monitors are never around when you need them and this will end up requiring neighbors to police the situation, constantly .documenting what we already know. The parking is inadequate. The DEIR also fails to address the impact of the Hyatt’s inadequate parking will result in cars parked along Wilke, [Woodglen], [Edley] streets. And these cars, will as a result end up creating unacceptable traffic and safety impact on these purely residential streets. The second point I wish to cover is the below grade parking that is to be situated across the street from residential housing along Wilke Way. This parking adds, of course, height to the building which is bad because it’s located right across from single family homes. The DEIR fails to address this impact. The height.should be kept to one or two stories, not two and a half. And this should be based on a flat, not raised grade. The parking would create other significant environmental impacts on these neighbors as well, which are not included in the DEIR. Several examples are noise when vehicles start its tire screeching, night time illumination, fuel emissions and that’s it, thank you very much. Chair Bellomo: Thank you. Lane Liroff followed by Sandra Rosenberg. Lane Liroff, Wilke Wag, Palo Alto: Hi, my name is Lane Liroff, I live on Wilke Way, that’s right across the street from the Hyatt project. And Mr. Kornberg, I wanted to point out that the row of trees is a landscape buffer but you can see through them very easily. And the pictures that the DEIR presented to you misrepresent what it looks like from my front lawn. And you know, that’s what’s most important to me. And, in fact, it provides almost only one shot of pictures on Wilke Way, and that one shot is terribly ugly. It will look ugly all the way down Wilke Way towards Charleston. I think that’s something you need to be aware of. But I wanted to talk to you today about the three driveways. There are five driveways proposed for this project but three of those driveways cross the landscape zone and the Zoning Code provides that you can’t cross that with a driveway unless there is certain protections that are provided. It is very unlikely that those the driveways on Charleston and the driveways on Wilke ¯ Way are ever going to be allowed to violate that Zoning Code. Page 44 The DEIR incorrectly says that there is a grandfather use to the Wilke Way driveway. I’ve looked at that, we’ve met with the City Attorney, there are serious problems to that Wilke Way driveway. It involves an intensification of a non-conforming use. They have morphed a chicken ranch into a luxury hotel usage that has limited use. And now what they propose to do is provide access for 300 apartments. And that’s a preposterous intensification of a non-conforming use. The DEIR to the extent that Mr. Jensen suggest to them, suggests that it is permissible is wrong. The residents are going to contest this. We’ve contested it to you. We’ve already met with the City Attorney and we will go to the City Council and we will contest it farther than that. There is a problem. So I think it is important for you when looking at this site to recognize that three of these accesses won’t work. Three of these accesses cause significant impacts, and require approval that it’s unlikely that they can obtain. Now, one last thing I wanted to mention, I know the clock is running down that the suggested mitigation of 40% in the DEIR doesn’t do what it purports to do. If you have a leak in your roof and you put.a bucket down, all that does is prevent the water from running over at that moment. But the project is too large. If you reduce it by 20% and put the only access on E1 Camino, what’s going to stop those travelers from going on to the Charleston quarter? It doesn’t do what it purports to do. Thank you very much. Chair Bellomo: Thank you. Sandra Rosenberg followed by [Jean Homestead]. Sandra Rosenberg, 4211 Wilke Way, Palo Alto: Hello, my name is Sandra Rosenberg. I live at 4211 Wilke Way. Basically, the first driveway at Charleston and Wilke, I am very concerned about the Wilke Way access. I will find it difficult to get out of my driveway if this continues as it is planned with the Wilke Way access. And the lights on Wilke will be activated more often because more cars will use that, slowing down all the traffic on Charleston. My other concern is any access the project has on to Charleston, especially the right turn only, any one who doesn’t want to go right turn on to Charleston will end up making a U-turn on Wilke, going through the signal twice and creating even more back-up if they want to go on to Arastradero or through north through the area. And I don’t think the U-turn was even addressed in the EIR, if they do allow right turn only on Charleston, it will create a havoc in frout of my house. Thank you. Chair Bellomo: Thank you. And our last speaker is [Jean Homestead]. Jean Homestead, 240 West Charleston, Palo Alto : Thank you, I’m Jean Homestead, 240 West Charleston. I’m speaking about open space. We all know now that open space is important to people who live in apartments and don’t have backyards. You know about the 30% requirement. You know about the 37% proposal that this project presumably provides. And I’ve reached the point of questions which you seem to have many of, too. I’d like to know where this open space is. I’d like to see it on a map. I’d like to know what it is. What kinds of areas are being counted, whether these areas meet the standard definition of open space, whether they were more creative. I’d like to know how the landscapes strip share of this open space is calculated because the strip starts in the middle of Charleston and the middle of Wilke. How much open space is there? Page 45 And, I’d also like to hear your thoughts about the sharing of space between hotel guests and residents. After all those questions are answered, I want to be sure that a reasonable amount possibly half of the open space is in the residential part of the project where it’s most needed. Open space at a distance isn’t as useful. I want to be sure that the residential part of the project won’t be left with an open space deficiency when the residence are sold and the link with the hotel is broken. And I want to be sure that hotel facilities that are available only to paying residential members are not counted as open space. The Draft EIR is incomplete until these questions are answered. Thank you. Chair Bellomo: Thank you. I see no further cards or no further speakers, we can return to the Board for their comments. Judith, you start it. BM Wasserman: I don’t really feel confident to say whether this EIR is adequate or not. I mean, this is not my area of expertise. I think there are still a lot of unanswered questions. I think the areas that I was questioning earlier is just the sustainability and compliance with City policies including all the policies and ComP Plan need to be addressed, issues of where the water comes from, where it goes, issues of where the energy comes from. I guess even issues of waste management need to be addressed. I think in terms of our urban environment and the impact on our urban environment that coordination with E1 Camino is extremely important. Transition to the neighborhood is ¯ extremely important. I suppose if you drew a conceptual site section, it would be low at the Wilke Way end and high at the E1 Camino end, I would think that the E1 Camino end would be no shorter than 3 5 feet. And that it would have retail along the whole front in that you would enter actually through the building in some ways. So that urban pedestrian experience on E1 Camino was really reinforced. And I don’t know if this has anything to do with anything but if I ever saw a place for traffic circle, that looked like one to me, the Wilke and Charleston, keep everybody moving, move people out of the project and around. And I’m not sure what the status of that driveway on Wilke Way is. I forgot to disclose that I met with the architects, Ken and I actually met them together. We were told that that driveway was required as access to one of the properties because it’s not all one property but even if the driveway is required to remain, it doesn’t need to be used. It can have a fence across it in som~ way that the traffic doesn’t use it. And some other creative blending of the residential area of the project with the existing residential neighborhood could still keep the traffic on Wilke down to a residential level if you couldn’t get to it as a hotel resident and into the higher density housing. I think a lot of creative site planning still needs to be done to mitigate the parking and traffic issues. I have so much of the issues of this project are really involved in design and site planning and that it’s hard to talk about the EIR without, anytime the EIR says mitigation means redesigning the project. Then where are we that project gets redesigned? We’re back here looking at the impacts again. I don’t really know how this circular process ever ends. Although, Lisa did Page 46 reassure me that if things got smaller, they wouldn’t have to do a new EIR. So maybe we get to actually look at architecture for a change. Thank you. Chair Bellomo: Thanks, Judith. Drew? BM Maran: I agree with Judith’s comments. I have no other comments. Chair Bellomo: Ken? BM Kornberg: I agree with Judith’s comments as well. I have a few additional ones. I’m reassured in the EIR by the number of alternatives and I think they address many of the issues that we’ve grappled with here at the ARB for the last year, more than I’ve been on the Board, And I think the interest that I have in the architecture isn’t really addressed by the alternatives because they are just plans, but I think that’s something that if they are pursued, it would be nice to see them pursued three-dimensionally. It’s not very easy to tell really three-dimensionally how this project develops and I think maybe Judith is right that it goes from low to high as you go from east to west. But it’s hard, I really can’t tell. I think that.intersection, I’ve experienced it since 1959, almost every week and it’s always been tough. And when you take E1 Camino Real which is 6 or 8 lanes, you really need to treat it in a way that it’s clear what to do when you come to that intersection and it’s not clear because of the way Hertz has two driveways and then Rickey’s has had two driveways also. I think in the end, it’s not going to help a lot to have a major entrance offWilke. I think somehow it has to be addressed with a specific stoplight which takes care of traffic for that particular complex. And I don’t know if you have to take it underground or over ground or what. But I can’t think of any way that you can add 600 people as essentially permanent occupants on that site and not affect that intersection adversely, unless it’s done through some specific mechanism. It just doesn’t seem to be that tributaries will have a chance at it. I think the DEIR certainly touches on all these areas and I’m not sure whether comments that we can make can direct you directly but I think there are a lot of tough problems with this proposed plans and I think they’re not as bad with the alternatives. I guess that’s all I have to add at this point. Thank you. Chair Bellomo: Yes, thanks, Ken. Thanks to Staffand all the writers of the EIR and the script ’ of the presentation here. I agree with the comments from both Judith and Ken. I think the best tools I saw to mitigate some of the impacts of the project for the neighborhood traffic calming is in some of the alternatives. Without a clear vision, I guess an overview though, I ’m very familiar with the intersection in the site, I really want to encourage vehicular pedestrian circulation patterns, as well as open space layered on top of this plan as it comes back as we see, obviously the new approaches, which I believe are warranted with all of the information. I think through those vehicles, through those type of forms and area planning, we can see some of the broader problems. Though it’s covered here and shows, I guess I want more 3-D, in a sense more 3-D or visual graphic studies presented, and I’m sure they will be coming. I, too, am leaning towards some of the other schemes I did see into as far as E1 Camino. I think the urban Page 47 nature of E1 Camino needs to be reinforced and we have seen projects that have recently come through the Board. The one on E1 Camino Way, for example, a smaller project but reinforcing that pattern of E1 Camino, of an urban feeling. And I find myself struggling with seeing again, parking out in front of E1 Camino. It seems natural to may be push it forward, creating more open space that could be a combined residential neighborhood parkland in a sense. One thing that we do look at is curb cuts. There are five that the proposed plan proposes. May be, in fact, that’s what needed but certainly we here, always want to look at how to reduce those and how to create more circulation on-site, reducing the amount of roadways. And again, some of the alternatives touched on those things. I think the EIR needs to adequately address kind of green building techniques that could be implemented into a progressive project that I believe that this applicant would like to present forward. And open space, I want to reinforce open space. It’s a technique to outreach to the neighborhood, as I think a real site planning again, technique that I think could make this a win- win situation for the developer and the neighborhood. And I really want to encourage more outreach, making this in the sense a community vision because I really do think certainly the user needs a good use but the neighborhood needs a friendly perimeter and a friendly design. And I want to add that I’m concerned to look at the some of the chateau designs presented in the EIR. I’m wondering again, I think we had an earlier meeting based on once we start establishing form and style that it’s kind of hard to stop. So I’m looking forward to seeing other architectural styles and character in mass come forward, I’m very concerned. I would say that would be the thing that I hope that is again, brought back forward. So, I really appreciate the neighborhood being here, Hyatt, the neighbors and all speaking to it passionately. It’s important for us to hear your feedback and we do all appreciate that. Lisa? Winn Furth: I just had a couple of concluding comments from a legal point of view. Board Member Wasserman commented on her feeling of inadequacy and deciding whether this was an adequate Draft EIR or a final EIR when it’s completed. Of course, the ARB’s role in this one is to read it and it’s very helpful to have your comments. It will be a much better document for them but ultimately, the Planning Commission will make a recommendation and’the City Council make a determination as to whether this document adequately describes the project and its effects in ways of minimizing or removing those effects. With the alternatives, of course, when the City is doing an EIR on its own project and those alternatives are things that the City can decide to implement and go forward with, here we have a private applicant who has a particular vision in mind and at the moment, our alternatives would be to say yes or no, not to have them adopt one of the project alternatives described in the EIR. Those are suggestions but nothing we can require somebody to do it as a whole, and that’s part of the reason for the design viewpoints will be taken about the effect drawings. But the reason for the design is because that’s the applicant’s design. That’s the applicant’s proposal for the site. And then finally, Carlin Otto commented that you really needed to read the document, not listen to Staff. And she’s correct, the same point has been made by the applicant. While we do provide some ways, we do provide Staff reports, we do provide our best responses. It’s the document Page 48 itself that we ultimately.get judged by and that you need to rely on. In fact, I don’t believe we made an error when we said there was inadequate water supply. We’re referring to the amount of water we get from the Hetch Hetchy and not from the size of the pipe in the street, but those are all relevant issues. Chair Bellomo: Winn, I have a question for you. In thinking, if in fact, an EIR is developed and approved or sets forward with this site plan, and let’s say it is approved, or the EIR is approved. Winn Furth:. Right, as opposed to project. Chair Bellomo: And this site plan comes back and we still know there’s still problems or we need to dig in and review this as we d.o on the Board and look at options and how did this evolve and really start from the beginning. But we’re seeing something that has had a beginning and a sense, an end to design. Is there another technique that maybe we can learn from it? We have a study session before an EIR plan is developed to this level. Because it kind of sets itin place. Winn Furth: Well, the applicant decides how much they want to work with the City on modifying things and there were a number of sessions and they could have modified their project, but they preferred not to do so. But the fact that an EIR analyzes the impacts of the project sets some outer limits. It doesn’t mean that it has to be approved. It doesn’t mean that it can’t be approved. As you know, if adverse environmental impacts are identified, it doesn’t mean the Council can approve a project. It means the Council has to consciously explain why it’s appropriate to approve the project anyway. First of all, EIR intended to have us not accidentally do things or do things without being aware of the consequences. They don’t prevent the Council from saying there are other factors that maybe we should go ahead anyway. There are requirements to adopt feasible mitigation measures. So if there are ways to make things better that are economically in other ways feasible, then we do have an obligation to do that. BM Wasserman: So let me just get clear on this. If this EIR in its final form is approved so that the project can go forward as a project, and it comes to us, it could be redesigned, the applicant could redesign it as long as the basic parameters don’t change so that the FAR doesn’t get any bigger, the buildings don’t get any taller, the parking deficit doesn’t get any worse. Winn Furth: So the impacts don’t get more severe. Some people who are more experienced might want to talk about this but, including John WagStaff, but there are. a lot of procedures for dealing with modifications. There are simply short documents where you analyze the fact that the new project has less serious impacts in every regard so that no further environmental document preparation is needed. I mean if there are minor changes that are needed, you do a supplement to the EIR. Depending on the changes that flow from the new proposal, you may need to do a bit more analysis. But if it doesn’t show any new significant impacts or any increase in them, then you don’t need additional environmental documentation. BM Wasserman: Okay. So, just to put a fine point on this. If there’s a 40-car parking lot shown on E1 Camino now and in the next time we see it, it’s not on E1 Camino. It’s somewhere else. It’s Page 49 not going to make any difference in that the EIR, I don’t want the applicant to have to basically, there’s too many trees already. John WagStaff: I think to the extent that any future changes are mitigating changes, this EIR will remain adequate. If any of the changes, as the one you’d suggested, if moving the parking. garage to another location of the site distributes traffic in a different way so that it actually increases the severity of impact substantially or creates a new impact, then there would need to be a supplemental environmental document. So that the idea is to try to keep future ’refinements to the project and redesigns within the EIR umbrella and ensure that they are mitigating changes rather than changes that create new impacts, or increase its severity of impacts. Winn Furth: When you think about what your charges, in terms of site and design review, you’re charged to make things better, to make things more compatible’, to make traffic and circulation work better. It’s hard to imagine a change that you would want that would have an adverse. environmental effect. BM Wasserman: This is actually the question that .we asked on the previous project. The previous review of the SOFA plan. This is not a development agreement. This is an EIR. So if they come back with [mesian] buildings or non-crafty [whatsis], it’s not going to make any difference. Winn Furth: I don’t know. It’s not about that level of design and esthetic. And if you go back and look at towards the back of the document, there is the initial study. And it lays out, for example, what an esthetic impacts from an environmental point of view are, which are much more dramatic and damaging and less subtle than the kinds of design issues that you’re talking about. BM Wasserman:- I think that we are speaking here from being more than once burned, and now we are more than twice shy about seeing very allegedly preliminary documents that have what look like final drawings and flavors, as Joe says that we would not encourage and support if they were to come to us as, you know, your every day garden variety project. And here they are shingle style, swoopy-roofies, and if we don’t like them, does that mean that we and the applicant more to the point is in a bind because they have sort of promised the EIR people swoopy-roofies and we don’t like them. Winn Furth: No. BM Wasserman: Good. Chair Bellomo: Okay BM Kornberg: Joe, I have a comment to make, I’m sorry. Chair Bellomo: Yes. BM Kornberg: We were given specific instructions on what was given to us and we were not asked to review the EIR. We were asked to review spe.cific sections only and that’s what I tried to do is to comment on things that I thought were more pertinent to what we are being asked. Those instructions has changed from the end of March when we first got it to what we received this week to what Mr. WagStaff thought we agree on reviewing today. And it covered most of Page 50 the same things so I just thought from the standpoint of the public’s understanding of our obligation, that’s what I felt. Chair Bellomo: Thanks, Ken. Staff Lisa: What we would ask you to do is make a motion to forward comments to the Planning Commission and City Council. So, if you’re comfortable with the comments you’ve made, you can for’ward those. Chair Bellomo: We might ask you to do the same thing as the previous application is to bullet those for us and include them in our next package. StaffLisa: That would be fine. Chair Bellomo: Thanks, Lisa. BM Kornberg: I so move. Chair Bellomo: All those in favor? All: Aye. ~Page 51 Planning and Transportation Commission Verbatim Minutes EXCERPT Attachment P 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 2o 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Planning and Transportation Commission May 8, 2002 Verbatim Minutes EXCERPT NEW BUSINESS. Public Hearings: South of Forest Phase II Coordinated Area Plan: Request by staff for Planning and Transportation Commission review and comment on the Draft SOFA II Plan. Chair Butt: So our first item the South of Forest Phase II Coordinated Area Plan has been in the works for a long while. Before we begin Commissioner Bialson has a comment. Commissioner Bialson: I am going to have to announce that I will not be able to participate in this matter as a result of having a client who’s property is located within the .study area. Ole Christensen is the client’s name. I was informed I would have to tell everyone who that was. Chair Burt: Thank you and I am sorry that you will not be able to participate. Lisa, would you like to begin? Lisa Grote, Chief Planning Official: Thank you, Chair Burt and Commissioners. Before you tonight is Phase II of the South of Forest Area Coordinated Area Plan. We are recommending that the Commission review, comment and make recommendations to the City Council on this draft Phase II Plan. As you are probably aware the Coordinated Area Planning process beganin 1997 with the passage of the Coordinated Area Plan Ordinance and also the policy framework both of which were included as attachments to your Staff Report. Originally the SOFA Area was an 18 block area, it was divided into two phases, one and two, in order to ~espond to the Palo,Alto Medical Foundation’s vacation of many parcels in what became the Phase I area and the recognition that those parcels would privately redevelop much more quickly than the long term private redevelopment of the Phase II Area. Phase I is currently under construction and what is before you now is Phase II. The roughly nine block area bounded by Forest Avenue on the north, Addison on the south, Alma on the west and then portions of Ramona on the east. That is outlined in your plan as well. The vision for the area as stated in the plan is to preserve and enhance both the eclectic uses and the eclectic architecture of the area. It is to preserve and enhance the pedestrian orientation and the walkability of the area and it is to preserve the historic buildings and character of those buildings in the area. There are a considerable number of goals and policies in the plan that Support that vision statement. One of the most notable goals is a new goal to develop a transfer of development rights program specifically for historic buildings so that they can transfer the bonus square footage that they obtain through a rehabilitation to another site either in the SOFA II Area Page 1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 46 or in the Downtown area. So that that square footage does not have to be used onsite but can be used on other eligible receiver sites. The Historic Resources Board reviewed this plan and made a number of comments which I will go over later but one of their primary comments was to support that transfer of development rights policy and also to expand it to include square footage obtained through a seismic rehabilitation as well. So it would be square footage that could be transferred from historic sites for either historic rehabilitation or a seismic rehabilitation of those historic buildings. The development standards have probably generated the most discussion over the last several weeks. As you knoW, development standards are the parameters within which physical development can occur either for a remodeled or rehabilitated building or for new construction on a site. There is substantial agreement between the Worldng Group, which calls for certain development standards or recommends certain development standards and the Staff. However, there are certain areas where there are some slight differences and I would like to go over those with you. They are alternative ways for addressing the same situation. They are not meant to be in opposition to each other however they are different and one would need to be recommended over the other. The Working Group Plan calls for a 1.15 floor area ratio in the entire area, .40 of that could be used for commercial purposes. The .75 that remains would be for housing purposes only, for residential use. Staff is in agreement with that division of that 1.15 FAR. Where Staff is recommending a slight difference is that the maximum FAR could extend to 1.50 along portions of Alma and High Street. That would be with a Planned Community development including substantial public benefit which would include items such as public parking, other public facilities, child care, public open space and other types of public services within the SOFA II area. So it could go up to 1.50 with a Planned Community Zone. The areas were that would be possible are shown in your plan under a Staff Recommended Alternative. Both the Worldng Group and the Staff support a maximum unit size of 1,500 square feet which would ensure that these would not be luxury units that are built but would rather be more attainable units, probably in the two to three bedroom size. There is also a slight difference between minimum densities. Both the Working Group and Staff support 30 units per acre maximum densities, however, Staff included a minimum density of 15 units per acre. There isn’t a minimum density in the Working Group alternative. The next development standard is Parldng. The Working Group alternative calls for existing parldng regulations as outlined in Section 18.83 of the Zoning Ordinance to be implemented in the South of Forest Area. Staff is calling for reductions in those parking standards for both the residential uses and for mixed use projects which would take into account reduced ratios because of the area’s proximity to the transit station and also bus service and shared facilities. Height limits are generally the same. It would be 35 feet for most of the area measured to the midpoint of a sloped roof or the top of a mansard or flat roof. With the exception that along portions of Alma and High it could go up to 50 feet, again measured to the midpoint of a sloped roof or the top of a mansard or flat roof. The difference being that there is a slightly longer or greater area that the Staff alternative includes along Alma Street where the 50 foot height limit would be extended to and those are shown in the two maps that are attached to your Staff Report. Page 2 " 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 46 The Worldng Group alternative calls for a prohibition on Planned Community Zone changes. The Staff alternative calls for the allowance of a Planned Community Zone change again along Alma or High tip to 1.50 FAR with substantial public benefit. There are some office limitations being proposed. One is that there be no new ground floor office along Homer and Emerson Streets. Staff and the Working Group are in agreement with that. It would allow for existing office uses to remain. This would be no new office use. We did not recommend any changes to the non-conforming use policies so if you have an existing office it can remain andit can also roll over to a new or a different office use. So there were no changes to the non-conforming use sections of the current ordinance. The difference is that the Worldng Group is proposing no new business office south of Homer Street. You could still have medical or.professional offices but no general business office south of Homer. The Staff alternative does not include that prohibition. In both cases, any ground floor~oflice would be limited to 2,500 square feet with the total amount of office use being a maximum of 5,000 square feet but 2,500 of that could be on the ground floor. The Plan does include compatibility standards and definitions in the development standards themselves. Those were developed along with the Historic Preservation Planner partially in response to some of the concern over the Phase I development and wanting to be as clear as possible about what compatibility means and how to apply that. So those were included in the development standards themselves. Finally, the review process is that non-historic sites would be reviewed by the Architectural Review Board, historic sites and non-historic sites that are adjacent to historic sites would be reviewed by the joint HRB/ARB Board that was created during the Phase I process. The HRB and I will cover those in a minute, and the ARB both had comments about that process and I lmow that there are representatives here from both Boards to tall; to you about that. Finally, I did want to mention the section on Economic Analysis and address the fact that we at Staff level had not hired an economic consultant to do the economic analysis. We had completed an economic analysis during Phase I of the process and did not anticipate that Phase II would be economically infeasible since there was at least one application submitted in the area for a mixed use housing and commercial development within existing standard, which allowed for less FAR than the proposed standards. That application is being proposed now so we did not anticipate that increased FARs would not be economically feasible. We had also been talldng with several other developers who are proposing mixed use projects under the existing FAR. Again, because this was increased FAR over the 1:1 ratio that is currently allowed we did not anticipate that this 1.15 or 1.50 would be economically feasible. One of the Worldng Group members has provided informati~)n that was attached to your Staff Report that would indicate that the economic feasibility is difficult at 1.15 if not impossible and that would also be true at 1.50. This is information that he will probably want to talk to you about in more detail as a member of the Worldng Group. This is not information that we have tested. It does indicate that in order to have an economically feasible project the FAR would need to be close to 3:1, which is an FAR that equals what is allowed Downtown. That is in conflict with what the vision statement for the area states which is to have this area be secondary to Downtown to have it be more neighborhood oriented and less intense than Downtown. SO there would be some need to review the vision statement for the area if in fact those FARs were to be considered. Page 3 1 2 3 4 5 6 7. 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3O 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 46 In general, the Historic Resources Board supported the Plan. They made four primary comments that are outlined in your Staff Report. One is to support Planned Community Zones for historic sites if benefit to the historic building would be a result. Also to modify the wording in one of the policies so that the parking reduction allowed on historic sites would actually be determined by the ARB/H Joint Board on a case by case basis and that parking reduction could actually be more than five percent, that the bonus square footage for seismic upgrades also be allowed for the transfer development rights program and then instead of using the terminology that a non- historic site that is adjacent to or across the. street from an historic site they supported using "the area of potential effect" when determining which buildings should be reviewed by the HRB/ARB. The "area of potential effect" is a nationally recognized term that is applied to structures that are on the National Register which state that if you have a project that would have some impact on an historic site that that project would need to be reviewed in light of the Secretary of the Interior’s Standards. That the area of potential effect would be determined first by the Historic Preservation Planner and that would then be reviewed by the HRB in order to determine which projects should go through the joint HRB/ARB. So that was their final comment regarding the process. A summary of the Architectural Review Board’s comments was also included in your Staff Report. Their primary concern was that the plan should be clear that enhancing an area doesn’t mean using duplicating or imitative architecture. That while the historic nature of some of the sites need to be recognized and preserved it does not mean that that particular type of architecture needs to be imitated and that should be made clear in the plan. That all references to the word "style" should be taken out or deleted especially since we have compatibility standards and definitions in the plan so that we can remove the word "style". Also the Board had some differences with the review process. They generally recommended that only historic sites go through the HRB and that non-historic sites go through the ARB, that the joint HRB/ARB not be continued. They did support prohibiting ground floor general business in locations south of Homer. They also cautioned to be careful when using a form code approach, which this plan attempts to do. We have developed some prototypes and Alison Kendall is here tonight to go over those prototypes should you have questions about them. We have hired her as a consultant to produce the prototypes, they are hanging on the wall and they were also included in your staff report. There was concern by the ARB that those prototypes not be considered the only way to develop sites and that there could potentially be other physical forms that could be used on those sites. We did as a result of that comment include one additional prototype in your packet that is not hanging on the wall that shows a different roof form than the steeply pitched roofs that you see in the original prototypes. So with that I would conclude the Staffreport and we are available for questions. Chair Burt: Thank you. I know that the Chairman of the Worldng Group has an important additional commitment so I would like to give him an opportunity to make his comments as early in the process as possible. Alison, was it your intention to also make a presentation? No, okay. If its alright with the Commission I would like to ask Mr. Hasset to make comments on behalf of the Worldng Group. At this time we will be opening the public hearing. Page 4 1 Mr. Larry Hassett, Chair, Worldng Group: Thank you Mr. Chair. I don’t really have any 2 prepared remarks I was just going to follow Lisa and kind of comment on anything that she may 3 have presented in a way that differed a little but form what the Worldng Group had done. Byt 4 she did a very good job, my compliments to her on that. 5 6 7 8 9 10 11 12 13 14 15 16 17 1.8 19 20 21 22 23 24 25 26 27 28 29 3O 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 46 I do want to stress a little bit about the process, the Worldng Groyup and when and how it was formed. It was created about 4.5 years ago and it was appointed by Council and there were many stakeholders that were appointed and represented on the SOFA Working Group including a broad range of people in housing, transportation people, environment. I represented the commercial and service area. There were residential people, developers. So most of the stakeholders were truly represented there. I have to compliment all of them, they did a fabulous job. The Working Group over the last 4.5 years has met what I counted up to about 40 different times. Those were all open public meetings. We had the ability to take public comment at each and every one of those meetings and the public did come out and respond at that time. We have had the ability to work with three different Planning Directors, Eric Riel, Ed Gawf, and now Steve Emslie. We have had the advantage ofworldng with liaisons from ARB, HRB and the Planning and Transportation Commission. Wehave had numerous people who have moved on in life and moved up the ladder. We have a former member that is now in Council and two that are on the Planning Commission here. I believe it was an absolutely fabulous group to work with and for. ~ I believe the Plan that is coming forward is a good plan. Nobody is completely happy with everything. I don’t think that would be a good plan. It is a compromise. Everybody is upset a little bit with this or a little bit with that. I think that is good, I think that is healthy, I think that shows that no one stakeholder got everything that they wanted. I think the vision of those people that sat on that Worldng Group is fairly unanimous. The vision truly amongst the group is really there. It is now the implementation and some of the last minute quarterbacking on how things are going to turn out that may be in question now, but the vision truly I think is a good vision. I would like to comment a little bit about some of the things that have gone on in the last few weeks. There have been suggestions that the plan should be trashed. That would be disappointing. The plan does alot of good things. If you were to trash the plan, just eliminate it completely, you go back to a zoning that is far less conducive to encouraging residential use. There are no takeaways more or less in this plan. So to trash the plan I think is the wrong direction to go. The plan should stand, the pluses on this plan, and it is a very difficult thing for this group to deal with is how you can enhalice and maintain the economic engine that has been operating in the SOFA II area. How you protect the auto service industry, the retail, the lower income office uses that have occurred, how do you protect those without putting so much development pressure on them that you end up changing the whole character of the area? So it was not easy to do. I think the guidelines that this plan came forward with do preserve and help maintain the character that is there now. I think that character is something that the City certainly desires. I think what we have seen in the past is a dot.com era came through, it put an awful lot of pressure on businesses to fold or change into offices. I think this plan helps protect those businesses that are still remaining. As I count them in the nine block area there are over 10 auto service businesses remaining. I think it is in the City’s best interest that those auto serving businesses are encouraged to stay. I would hate to see Palo Altans have to drive to Redwood Page 5 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3O 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 City to have their cars repaired. I think that the lower rents that are afforded now to some of the other service and retail businesses needs to be protected. So overall I am very pleased with how the plan accomplishes it in a very balanced way. I would like to comment on a couple of other things. One is the elimination of the PC Zone by the Working Group. The Working Group on two occasions actually voted oh whether or not to retain PC use in the SOFA II area.- At the last two meetings votes were taken and in both cases they were turned down, PC should be eliminated from the area. I think those were both six to five or six to four votes. Interestingly enough the composition of the committee on both evenings was different. So in reality if you combine those two you get the same outcome. Also this as well, that the group that decided to allow PCs strongly encouraged that there be a cap and not go so high that it really does influence and change the entire character of the area. I think one of the other things that we should be looking at is this is not a Working Group plan that it is a redevelopment plan, so that we can redevelop this area inthe next year or two, it is a long term plan meant to guide with design guidelines and proper community standards the direction that we want to see this are to continue to evolve. So I don’t think it is right to look at this as something that is a quick fix to change the character of SOFA at all. I think it is a long term plan that lays out the vision and the guidelines that will fulfill the vision that the Working Group truly believes in. So that is my off the top of my head remarks and I’ll answer any questions as the Worldng Group Chair. I will have to leave for another public meeting that I am responsible to attend. Thank you. I’ll take any questions that you might have of me now if you would like. Chair Burt: Do Commissioners have questions of Mr. Hassett or regarding the Worldng Group? Phyllis. Commissioner Cassel: Yes. In what way do you really think this plan will preserve the auto repair stores that are there? Mr. Hassett: If you look at the history in the last three or four years what you are seeing is basically businesses that left because the dot.corns took over those building shells, radiator shops, the glass company. There was tremendous pressure on that to occur. One of the things that this does is it stops office migration soiith of Homer. So that ldnd of in a way protects it. It also hopefully will be protected by having development that is reasonable in scale and mass and everything else that the development potential to increase the size of buildings and stuff will be lessened. So that the pressure for a property owner to change from an existing auto use to an office or another use is lessened if the potential, it just lowers the development potential to the point where they are hopefully protected in some way. I think we are still going to lose a few more. I am hoping that we don’t lose too many more before it is all over. Chair Burt: Bonnie. Commissioner Packer: In your remarks you didn’t mention anything about the proximity of this area to the train station and the bus center. Could you discuss how the Working Group talked about this as a potential transit oriented area? Page 6 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17. 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 46 Mr. Hassett: A lot of time was spent on taldng advantage of the transit opportunities that exist. There were a couple of things. One, the encouraging units of 1,500 sqaure feet or less was certainly targeted at trying to encourage transit oriented development to occur. In addition to that attempts were made to encourage affordable housing and low income housing along the Alma corridor. There was a tot of conversation about car sharing and other projects that might also come a long way in promoting transit oriented housing to be added. The plan itself doesn’t add any more incentives for any more commercial. That .40 FAR for commercial is what exists now and it is what exists in the proposed Worldng Group ,FAR. All the additional FAR that is being proposhd is for residential and hopefully that will be just infill residential that will take advantage of the transportation corridor and hub. Commissioner Packer: Did you discuss changing the parking requirements at all? Mr. Hassett: Yes. A lot of time was spent talldng about parking. That is the one area where Staff disagrees a little bit with the Working Group. The Working Group, I could best express it by saying this is an under-parked area right now. That the impact of the business community right now really is inundating not only that area but is spilling over into the truly residential area. And that for there to be an encouragement of being able to under-park a building when you develop didn’t necessarily relieve any of the problems and in fact it exacerbated the problem that exists there now. The problem with the SOFA area is it is out of the parking assessment district that exists to the north and it has almost zero change of ever attaining a parldng assessment district to address the parldng issues. So what we are really looking at is ways of hopefully having some of the newer developments that might come along do some parking sharing situations where residential might be ale to compliment some of the commercial that may be in the same building or a different building. Chair Burt: Thank you Larry. I would like to personally thank both yourself and the Worldng Group for the tremendous commitment. It took a lot of perseverance to go through not only the first SOFA plan which was intended to be the only one but then also Phase II. For all the Working Group members and in particular those who-have gone through a five-year commitment to this, it really demonstrates a great commitment to the community and to this sub area of the City, and we want to thank all of you for the real commitment that you’ve made.and the contribution that you have made. Mr. Hassett: Thank you. Mr. Steve Emslie, Planning Director: To the Chair? Before we move on to the public hearing I just did want to point out that we did receive several letters that were received not in time to be distributed in the packet. They are at your places. I would just like to acknowledge that we did receive a letter from Bob Kuhar dated’May 7, which is at your place. We did receive an email from Irvin Dawid also at your place that was dated Wednesday, May 8. We have a letter dated May 5 from Dave Bubenik, a member of the SOFA II Worldng Group. We also have a letter from an attorney, Curt Schmidt, which was dated May 7. We have an email addressed to the Board of Directors of the PAST Heritage, which was adopted on April 3, 2002. Also at your place we have a letter dated May 8 from Joseph F. Martignetti from Ventana Property Services. We have a letter dated May 8 from Carrasco & Associates, owned by Tony Carrasco. We have a Page 7 1 letter dated May 6 from Patrick McNenny from Full Degree. We also have a letter dated May 6 2 from Eric Sterger for Kurts and Dorns Auto Service. Lastly, we have a letter dated May 6 from 3 Pam Davis, President of the Buena Vista Residents Association. We also have copies available 4 of these at the back of the Council Chambers should anyone care to have a copy. 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 46 Ms. Wynne Furth, Senior Assistant City Attorney: Finally there are black and white copies of color maps that Commissioner Griffin has brought to be part of the presentation tonight as well. Chair Burt: Those maps are also available in back? Ms. Furth: Yes, you will have to color them yourself. Chair Burt: Karen. Commissioner Holman: I also brought something tonight that has been copied and is at the back. Mr. Emslie: I do apologize. We do have a letter from Karen Holman regarding SOFA II dated May 8 and I am sure we will be talking about that a little bit later. Chair Burt: Thank you. At this time we have five speaker cards with more arriving. We now have nine and I suspect we may have more before the evening is out. So I would encourage everyone to come forward and put the card in. Our first speaker is Harold Justman to be followed by Herb Borock. Each speaker will be allowed five minutes. Welcome Mr. Justman. Mr. Harold Justman, 828 Ramona, Palo Alto: Good evening Chair Burt and honorable Commissioners. My mother and I have been investing long term in residential real properties in Palo Alto since 1968 and most recently in 1999 1 rebuilt 828 Ramona and in the year 2001 I rebuilt 242 Ramona. I am familiar with construction costs, land values, rental values and I have tested Steve Pierce’s economic analysis and I can report to you that the SOFA II Plan is economically feasible for a long term investor. As a long term investor I see golden opportunities in the SOFA Plan and I think other long term investors would agree with me that we have a.vefy good economically feasible plan here. Using Steve Pierce’s numbers I’d like to briefly go through some numbers with you that demonstrate the economic feasibility of the plan. Mr. Pierce broke out six scenarios and I’ve taken a couple of those scenarios and will demonstrate the economic feasibility. The scenario two is five condominiums on roughly 8,000 square foot lot and the condos being 945 square feet each. I do adjust his land values. For this scenario the land value of $100 per square foot instead of $140 per square foot that he put in would be more appropriate. With that adjustment using his other numbers what we see is that for an investment of $2.0 million a long term investor would have five condominiums even in today;’ depressed residential rental market which is the worst I have seen since 1974, those units could rent for $2,000 per month. That would give you an annual cash flow of $120,000 which is a rate of return of six percent on your investment. So as a long term investment you are getting a six percent return on your money and in a recession environment obviously as the economy picks up your rate of.return is going to Page 8 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 46 increase and long term you will have substantial significant appreciation. You could expect to double your money in seven to ten years under these numbers and scenarios. In scenario number three you have seven condominiums. They are two bedrooms on the 1,350 square feet. Even in this recession environment they would rent for $2,500 per month. So with an investment of approximately $4.2 million you could have an annual cash flow of $210,000, a rate of return of five percent whichfor a long term investor is economically feasible and attractive. For example, the Treasury sells long term Treasury Notes, 10-year Treasury Notes, yielding five percent and the Treasure has no trouble selling those notes even in today’s present recession. So the government vies a five percent return over 10 years as an economically feasible investment and many investors must agree because they buy these notes up every time they are sold. The plus of course is that in the SOFA II Plan you get the long term appreciation of these properties. In seven to ten years you can double your money and make five percent during that period of time. The scenario four shows five condominiums and approximately 3,000 square feet of commercial. There are 3,150 square feet of commercial. Under this scenario when you invest $4.0 million and you end up with a cash flow of $252,000 or a 6.3% return on your investment with the expectation that on the long term you are going to double your money in 17 years. We have an economically feasible plan for the long term investor. This plan is not for the short term investor who wants to make a million bucks in 18 months as scenario six would indicate. You don’t need 18 units on 8,000 square feet of land to make an economically feasible job out of this SOFA II Plan. Long term it will encourage long term investment and will ultimately provide us with housing and a good return for these investors and the plan is surely economically feasible and for a long term investor it is a gold mine. Thank you. Chair Burr: Thank you Mr. Justman. Are your comments available in writing? Mr. Justman: The economic ca!culations I just did for you I haven’t reduced to writing but the general o~erall analysis; the conclusion that we have an economically feasible project for long term investors, is available in writing. I have copies here if you would like them. Chair Burt: Please. Any other questions for Mr. Justman? Karen. Commissioner Holman: Could you make the other information available? I think you said you had not the analysis but your statement was available. Could you make the analysis available as well? Mr. Justman: I’ll need some time to put these numbers down in writing and crunch out the numbers and do a spreadsheet analysis like Mr. Pierce did. Yes, I could do that it is just going to take me awhile. The conclusions were easier to articulate in writing right away. Chair Burt: Would staff appreciate that? Page 9 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 46 Mr. Emslie: Yes, we would. Chair Burt: Phyllis. Commissioner Cassel: I have a question. You said you have been developing in the area. This plan proposes a 1,500 square foot cap on the size of units. Will that also work or does that cause any problems? Mr. Justman: No, the 828 Ramona I built, it is 1,400 square feet and is economically feasible. I live in it. Then the 242 duplex that I just built, each unit is approximately 750 square feet. So you have a combined of about 1,500 for that and that is economically feasible. It is all rented out and doing just fine. You can have economically feasible projects with these parameters. Chair Burr: Mr. Justman we are giving you your exercise this evening. Mr. Justman: I’ll just stay here until you tell me I can sit down. Chair Burr: Okay. Karen. Commissioner Holman: You had changed your base numbers from $140 per square foot as Mr. Pierce had used to $100 per square foot. You said that was more appropriate. Can you either correct me or explain what your justification for that was, p!ease? Mr. Justman: I only did that on scenario two which is the five condo project. I reduced the land value to $100 per square foot instead of $140. On scenarios three and four I used $140 per square foot value as Mr. Pierce had, although I think it is probably a little high. There was only one scena{io where I felt it was inappropriate to use the $140 per square foot because $140 per square foot really is the land value if you have a completed office building 0n the lan& I don’t think it is appropriate for the residential. The residential should be more like $100 per square foot. But eveia using the $140 in scenarios three and four you still generated a cap rate that is consistent with an economically feasible and attractive investment. Chair Burt: Great, thank you very much. Our next speaker is Herb Borock and then after that I would like to give the representatives of the ARB and the HRB an opportunity to comment. I had not appreciated that they were here and may like to comment and express the perspectives of their Boards. Mr. Borock. Mr. Herb Borock, Palo Alto: Thank you. I appreciate Mr. Justman’s comments because he is an experienced property developer and owner in the area and has credibility on the figures he has given you. However you also need the appropriate economic analysis for someone who wants to turn over the property quickly to develop it. Unfortunately the numbers that you have before you from Mr. Pierce don!t do that type of analysis. They don’t show you how a developer l~verages money by borrowing most of the cost. I tried to find out that information about this particular property today and unfortunately I couldn’t go to San Jose to look at the information on the deed but there is some information across the street in the Development Center. There is a private company that provides that information on microfiche that is available there. The information Page 10 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 46 was in a form, which mean someone has to go down and do the actual research in order to provide the appropriate analysis. I will tell you what I did find. According to the information available in the Development Center this property was purchased 20 months ago and the price that it shows is $760,000 with a 90% mortgage. The assessment shows a $1.0 million assessment showing the $760,000 as the land cost and $240,000 as improvements. Just to take these numbers and compare what Mr. Justman said, the $760,000 land cost comes out to $95.50 per square foot, which compares to his $100 per square foot. By taking the $1.0 million total it comes out to $127 per square-foot compared to that of a fully redeveloped numbers that were used in the examples of Mr. Pierce. It seems to me it would make much more sense to take a look at what was actually paid for the property recently and do an economic analysis rather than looking backward as has been done in Mr. Pierce’s examples before you to impute some land value. There are standard weighings over at the Land Institute that they can show anybody. There are the books they publish about how to do the kind of analysis that a developer does to determine what the rate of return on the developer’s investment is. When someone has those numbers and I hoped I would have the time to do it, and maybe Staff can do it, you can work out from this one example the 940 High Street what the rate of return would be on the various costs for those that have been presented to you. This property is also adjacent to property which is labeled as historic, 900 High, in both Mr. Pierce’s example and in the Staff Report. I understand that property is going before the Historic Resources Board. Maybe it is a category change or maybe it is for historic: I don’t exactly know what the status is so I don’t know what is listed here is historic. I don’t know if that is something ttiat already is historic or that someone is applying to get the historic credits. As I understood for that property the intent was to transfer the development rights. That gets into the question of whether the proposal from the Working Group is different from the current way to transfer development rights works. Currently, receiver sites depend upon the type of use and the zoning for the potential receiver sites. If residential is treated differently than commercial for receiver sites and residential in general is treated differently than residential in Planned Community Zones. You might want to compare what the Working Group is proposing to let you have. Finally, on the types of uses the residential versus retail versus office, the residential and retail are essentially given the opportunity to lcnow in the future the intensity of development. The office use development, as we have seen over time, can always be intensified in the same square footage leading to more cars and more traffic and more parking needed. Residential and retail uses tend to put an upper boundary on what can be done in the future in the same structure. So to create that kind of a balance of what you want with office, retail and residential you should keep that in mind. Thank yOU. Chair Burt: Thank you. We have a representative from the HRB, Mr. Kohler. Mr. Roger Kohler, Historic Resources Boardmember: Good evening. I was asked to come down here and espouse on what our Board came up with. I think Lisa Grote has done a very good job of explaining the four major items that we came up with. I am here just to answer if you have any particular questions about the four items that we came up with as our recommendation to the SOFA Plan. I think number four is the one that we talked about a great deal. It was the area potential effect which, even though a building is not next door to an historic project it has impacts on that Page 11 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 historic building in other ways than just being adjacent to the property. Height, traffic, pedestrian use, these kind of items, would have an impact on a structure that might not be immediately adjacent to an historic property. Dennis Backlundis here tonight and he gave me an interesting note. Right now there are 28 identified historic resources in the SOFA II area and potentially several more in the area which are not on the list and may not be eligible for the California Register of Historic Structures but are older structures that we may want to consider as part of the historic fabric of this area. So that was one of the major areas. The actual definition are of potential effect is something that we were going to go into in greater detail and see if we could come up with an acceptable definition that would be used as part of working through this program. I just am here if you have any questions I can answer them. Chair Burt: Phyllis. Commissioner Cassel: Yes. This area of potential effect does not give any sense of certainty, it would seem to me. The hope here is to develop a plan that gives people some certainty that they don’t have to go through a long process. They have been through it. How do people know whether their building is going to have an area of potential effect if you can’t even tell us where. it is? Mr. Kohler: Because this just came up two weeks ago and we haven’t had a good time to discuss it, right now it is somewhat vague at the moment. The idea was that if you had a property that was in the area it would run past Dennis Backlund, the Historic Planner, he would make an initial determination whether in fact it had any impact at all on an historic building and then if it did it would come before the Historic Resources Board. That was part of what we ~vere going to talk about in a future meeting and define what we might recommend if it has an impact or what ldnd of impacts it might have. It may be more than just saying setback the third floor three or four feet. I don’t know. That is what we haven’t decided. That is why it is On the list. Chair Burr: Bonnie. Commissioner Packer: There are design guidelines and development standards that talk about new structures being compatible architecturally and in mass and scale. Wouldn’t that encompass any concerns that you would have on the relationship of a new or remodeled building on an historic structure? Why would you need to set a different set of standards for something that is historic as opposed to just a nice building? Mr. Kohler: That’s true. In some ways the differentiation might not be that tremendous but what I envisioned is there might possibly be a project which is say 100 feet width on the street frontage and then it might be like a 25 foot wide property next to it and then just beyond that might be an historic building. If you go by the letter of the way it might be written only the adjacent site would be considered as having any impact on this large project. Yet the lot line is all of 25 feet away from whatever this large building might be. I am just guessing having been on the SOFA I HRB/ARB Committee. We were constantly up against the problem or the Page 12 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24. 25 26 27 28 29 30 31 32 34 35 36 37 38 39 4o 41 42 43 44 45 46 difficulty in defining how these new structures were worldng within the historic Homer Street street when we were working on several of the projects there. One of the things that not only the HRB members felt restrained but the HRB as well is that in the SOFA I program the allowable square footage was predetermined. There was no flexibility in that. I can’t remember the actual term but the developer was granted a certain amount of square feet and there was no flexibility. So typically if you come to an Architectural Review Board meeting you will see that the Board Members will recommend that some square footage be taken off the upper floor or on the side to make the building more compatible with adjacent properties. On the SOFA I project we had no flexibility to do that. The builders were guaranteed a certain amount of square feet. That, for me, was particularly frustrating. I found it very upsetting that we did not have the normal flexibility that the ARB normally has when they review projects. So when this plan was presented I see that there is a lot of flexibility and there are no guaranteed square footages in any of the properties as far as I can tell reading the proposals. To answer your question all they wanted to do was have at least a look-see to at least say okay, the building is big but it probably has been designed in such a way that it is compatible with the street, the homes down the street, or the existing small commercial buildings across the street. That is all we are hoping for. We are not trying to be onerous or limiting in any way. We just want to be able to at least comment on the proposed project. Chair Burr: The HRB position differs from the ARB position on whether, not just adjacent sites, but if potentially affected should be reviewed by HRB. Any comments on that? You are an architect as well as a member of the HRB, what are your thoughts on how you would respond to the ARB position? Mr. Kohler: Well since this is a public forum I am going to limit my comments to the fact that it is a difference in philosophy in effect. I think, myself and a lot of members on the Board as well as members of the community, value the reuse of older structures in a way that there is something to be gained by having these buildings reused in some fashion. You look around at the [Zebeba’s] for one which is an older building which is now a very successful bar and restaurant. There was some question on the Board whether in fact that was preserving an historic building. There was more work done on that building than you might like to see but on the other hand the old building is still there and you can see it and it is being reused. So I think the Board Members are realistic in the fact that we can’t preserve every single building that is here in town but it is amazing at how little it takes to incorporate existing structures into a new structure and make it work successfully as [Zebeba] points out in my mind. So that is what we are trying to do. Chair Burt: Karen. Commissioner Holman: Can you respond to Mr. Borock’s query comparing the TDR program that is proposed in the plan compares to the current TDR program in regards to how it would be applied to retail or housing? Maybe this is a question for sti~ff. Mr. Kohler: I am not sure I can give you a really knowledgeable comparison.. I think the goal of our comment on number three about creating office and development rights for seismic upgrade is that the Historic Resources Board has always been to try to provide incentives for maintaining Page 13 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 and keeping historic buildings as well as historic homes. In the works, as you know, is an historic home incentive program. If you have an older home you will get incentives and breaks from the Zoning Ordinance in exchange for preserving your historic home or structure. So our goal here was that if you are upgrading and rehabilitating an older structure and you are not utilizing your total development area that you might be allowed to transfer that somewhere else in exchange for money to use to upgrade the historic structure. That was the goal of our item number three here. I couldn’t pretend to tell you how it compares. I am not an expert on that. Chair Burr: Thank you. We appreciate your comments. Mr. Kohler: Good luck. Chair Burt: We have a member of the ARB here this evening as well? Ms. Grote: No, unfortunately they couldn’t attend. Chair Burt: Very well, thank you. Our next speaker is Ian Irwin to be followed by Steve Pierce. Mr. Ian Irwin, 800 Cowper Street, Palo Alto: Good evening. I am a member of the Working Group. I live on the comer of Cowper and Homer in a house originally built in 1906 as a boardinghouse replete with Murphy beds in the wall. When my wife and I bought this house we considered it a good investment. We have been there for six years and have four tenants. So it is still serving its original function across from the Women’s Club. I am here tonight to support the SOFA II Working Group Plan. I just can’t avoid contrasting this plan with the SOFA I plan and consequences. What is on the ground in SOFA I was really something that was hatched behind closed doors between former Staff of the City, developers and property owners. In spite of the fact that there was a SOFA I Working Group for the first phase in fact that process was violated and one only has to have been at some of the public meetings since the outcome of the PAMF redevelbpment to really sense the depth of feeling and betrayal that the community had at large. What has that actual outcome left us with? Well it has left us with in the SOFA I area a very large executive overbuilt housing, luxury housing, and a great deal of office space that was objected to by residents, This are residents, that endorsed and advocated for a park which is now probably a reality, advocated for be!ow market rate housing which is a reality, and also advocated and supported a childcare facility which is also a reality. I think SOFA II is a tremendous contrast to that. SOFA II brought together new City Staff, many new City Council Members, many who came into their positions as a result of some of the feelings and activism of SOFA I neighborhood, new public Commission Members as well. I think the plan was developed not behind closed doors but democratically out in public over pizza, many nights of sometimes intense discussions over various issues. I think all in all as Larry said, the plan represents a consensus and a good plan which allows for growth in the area which invites long term development. Again pointing to SOFA I we can look at what is on the ground. We had a lot of office and if you look around that office right now has been postponed, delayed and what we have are vacant lots. The economic climate in which those projects were proposed and developed is long past us. Now we come to SOFA II and many will come before Page 14 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 you saying that this plan is not economically feasible. I would remind you that these are the same voices that basically breathed life into the economic bubble of a year or two ago and told us that we need offices in the area. This is when office space was competing with that in Tokyo and New York City. They saw the big score. Well, now they see the next big score and that’s 20 or 30% profit turn the land around, build housing. It kind of reminds me of farmers who are notorious for this. If one farmer is successful one year, the next year everyone plants the same crop and they will go bust. That is the way it works. Anyway, you have heard that many of the presentations are the economic infeasibility are probably quite challengeable just on the data simply alone. I think we have heard some good evidence of that. I will say that there is going to be pressure to ask for increased FAR, to ask for increased massing, reduction in parking requirements, any loophole and you probably should see yourselves more as an accountant being approached by a taxpayer in terms of how can we get around this. More than anything that I am fearful of is that this process will be taken behind closed doors again. So I ask you to look at the plan carefully. I think it is a good one it has taken an awful lot of work. As Larry said, it doesn’t suit everyone but it certainly suits people that are going to be in Palo Alto for the tong term, who invest here and are going to build a community as I and many of the people you are going to hear from tonight are. Thank you. Chair Burt: Thank you. Steve Pierce to be followed by Ole Christensen. Mr. Steve Pierce, 209 Cowper Street, Palo Alto: Good evening Members of the Commission. I have been a member of the SOFA Committee for four plus years. By profession I am a developer and real estate broker, by training I am a City Planner and formerly I worked with Stanford Research Institute on Staff as a real estate consultant. In overview, I agree with Larry. The vision of the plan is good. Where I disagree is I think we have very poor implementation and good vision. A planning requires that the public and private sector be swimming in the same direction. The public sector in many cases provides sort of the vision, the goals of what they want achieved but it has to rely largely on the private sector to pick up that goal and to implement it. The problem we have with this plan in my vision is that the private sector just isn’t going to pick it up. It is not going to be implemented as the vision. How do I come to this conclusion? First I did an analysis that embraced two things I would like to cover. First a little background. The existing zoning allows a floor area ratio of 40% for commercial and 60% for residential for a total of 100%. The SOFA concepts that we discussed at some length was sort of this notion of zoning plus, keep the underlying zoning but create incentives so that people would build more residential as well as potentially retail. So as a consequence we had the underlying zoning and residential tweaked up from 60% to 75% and then in the Staff option perhaps up to as high as 150%. So my goal was really to test the hypothesis. Would these floor area ratios likely result in implementation of our vision? That vision being more residences and mixed use and those ldnds of projects. What I did was to test the various FARs that were allowed under the plan and some of the recommendations of Staff on typical sites. The one I presented that you have there in your Attachment K was to take what I call the Bill Young site as that is the name on the building out on High Street. The analysis that I went through, really Bill’s best option was to paint up his building and lease it out. That is to say Page 15 1 2 3 4 5 6 7 9 10 11 12 13 14 15 16 17 18 19 2O 21 22 23 24 25 26 27 28- 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 at the time that he decides he no longer wishes to work at that site. All the other options, mixed use, residential, etc., I found lost money. That is to say they didn’t have a poor profit potential but lost money. Those were for sale projects in deference to Mr. Justman’s comments a rental project would render returns in the area of, by my calculations, four to five percent. We can talk about that later. What basically I demonstrated was probably the obvious because what have we seen over the last couple of decades? We have seen people not tearing down their buildings and creating mixed use or residential property as they could under the existing zoning but we have seen them paint them up and lease them out for primarily office uses. That basically what is feasible out in that area. Why is that? Why is it better to just paint up your existing building rather an go up to an FAR of 150% with residential? A lot of it has to do with parldng provision. When you start getting up to the higher FARs certainly over 75% with residential parking needs to go underground. As soon as you are underground you at about $35,000 per stall and you just need more of a building to be able to support the Cost of that ldnd of parking. So when you cross Over that line the projects become much, much more expensive. The second analysis that I did was kind of a land analysis. I went out and looked at all the parcels based on a lot of the data that Staff had produced and looked at what would likely actually turn over or be redeveloped. In the map that you have there in that exhibit what I did was I eliminated the historic sites, the sites that are overdeveloped by today’s standards as well as those that are proposed, the small lots, those too small for underground parking, the proposed projects. What you have left is about 10% of the land area and about half of that is the Whole Foods parldng lot. So what we have really is very little land that is likely to be redevel0ped at all under any FAR that is acceptable to me or anybody else in this City and so we have a SOFA Plan that is really dealing largely with a developed area. By developed I mean what appraisers would call sort of the highest and best use. So if we want to change that we really have to do something that is probably significantly different than what we have in our plan. Commissioner Packer: I have a question. Could you explain whatwe need to do? Mr. Irwin: I think as I see it is really a question of sort of vision. If the vision is that we want incremental change out there, that is to say sort of a continuation of this upgrading process that we have seen over the last few decades, then we keep the existing zoning or something close it and allow that process to continue. If our vision is to say yes, we really do want mixed use, we want more residences, then we are going to have to face the fact that we need higher FARs probably in selected locations. So it is really a question of which vision you want. I am not here to say yes, lets crank up the FAR, I am saying which vision do you want. But recognize that the vision statement in the SOFA Plan is disconnected from the floor area ratios that we have and we shouldn’t expect that that plan is going to render mixed use projects or more residences. So I would recommend basically that you not endorse this plan, that we keep the status quo zoning and allow the Zoning Ordinance Update to sort of deal with some of the flaws of the existing zoning. Alternatively, if we do want something more aggressive then I think we need to go back to Staff and say we need a plan that is really achievable in terms of what is going to be feasible and what developers with actually follow through on. Page 16 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 . 43 44 45 46 Chair Burt: Any other questions? Thank you. Mr. Irwin: Thank you. Chair Burr:. The next speaker is Ole Christensen to be followed byDavid Bubenik. Mr. Ole Christensen, 801 Alma Street, Palo Alto: Commissioners, I been a member of Palo Alto since 1955. My dream was to grow up here, live here, bring up my kids here, have a business here and when I get ready to retire do something with my property that would be appreciated by everyone. On a separate issue you need to understand the auto industry in Palo Alto is in serious trouble. When I am done speaking you can ask me questions about that. Any development, in my opinion, in the SOFA Area must allow for continuing parldng for current business owners in the area, access to streets. It is clear that if we don’t have street parking for our businesses without doing any construction we are going to have a problem. Developers need to provide off-street parking for their workers during any of these projects away from that area so they won’t interfere with us. I went to a lot of the original SOFA I meetings and for personal reasons couldn’t be involved in the SOFA II. I feel that a lot of the stuff that Larry talked about is clear interest to the neighborhood. I appreciate everyone’s effort that worked on that. I do have some comments that I want to make in areas that I disagree. I don’t feel it should be scrapped but I think it should be modified. I don’t think developers in this area can do any kind of development and bring more housing to this area unless they are getting more larger FARs out there. Two to 2.5 would not be uncommon to make it work. Another 20 years from now we are going to need 20,000 more places for people to live in this City and we need to think about it now and head in that direction. So if we are not seeing housing production now, what are going to do in 20 years? There is no doubt that the City is going to need to .do planning in the area of more density housing rather than some single unit . stuff..PCs in this area I think should be allowed. I am in full support of that. My own personal property, I’d like to do that with also. Since my property is on Alma Street I don’t have a problem considering doing something in the 40 to 50 foot range with some staging off of the main street. I have been contacted by the City of Palo Alto. They have a potential two-year plan to move the electric yard next to my building and move it over to Quarry Road it is not really congruent with the neighborhood. I think that would be a good thing: With that I am open for questions. Chair Burt: Michael. Commissioner Griffin: I will take you up on your offer to talk a little bit about the problems with the auto industry in Palo Alto. That is one of the things that we are trying to preserve here and I would be interested in your comments. Page 17 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 46 Mr. Christensen: Well, number one, the last auto parts store in Palo Alto left just a few months ago. We have no support system for it. Everything that we get now is shipped in. The closest we can get is Redwood City. Delays in getting parts into our shops just to get cars fixed means that we have a lot shorter period of time in the day to get stuff done. We are squeezed in getting stuff in the morning coming in, it is an hour or hour and one-half for deliveries. If we don’t get them there in that reasonable fashion cars don’t get done by 5:00 that day and they are put off to the next day. So it is really tough. There has been probably a diminishment of at least 20 car repair shops in the City in the last 20 years. The last couple of years we have lost a few more. It is to the point where the auto parts store couldn’t even sustain itself here so he went ahead and just sold out to another place that can do shipping in with us. It is two hours to get parts from them so it doesn’t work. So we are hurting. People aren’t bringing their cars in anymore. There has been a lot of big money in the last few years and people are buying brand new cars, long time leases that include service contracts. I used to run eight mechanics full time and have cars wall to wall down Alma Street and now I am down to three mechanics and I can’t keep them busy. So I think the cowis out of the barn and I am not sure the auto service industry is going to sustain any length of time here. I am going to do my best to do that. I am even willing to go in. and work with another shop and join my business with another one. That is probably what you are going to see happen. I think for the most part most of them are gone and that is going to be a problem. That’s mycomment. Commissioner Griffin: So it is primarily than lack of parts availability locally to have an expeditious repair operation and long term leases on new cars diminishing the requirements of your services? Mr. Christensen: Yes, that’s it. Chair Burt: Thank you. David Bubenik to be followed bY [Shalamath] Rubinfien. Mr. David Bubenik, 420 Homer Avenue, Palo Alto: Good evening Commissioners. I live in the SOFA I district and I am also a member of the SOFA II Worldng Group although I am here speaking on my own behalf only. I am here to advocat~ for the SOFA Worldng Group Plan and give you a few perspectives on how I see it coming together and why I took certain positions. My vision for the area is that it would stay like it is. I find my self in a rather profound and surprising agreement with Chop Keenan immediately on that point and with Steve Pierce too. I don’t mean this place is going to stay exactly like it is with every building in place, etc., and every business in place. It is an evolving area. It is Palo Alto’s oldest historic area. It has been evolving for over 100 years and it will continue to. I think it is a wonderful [ferment] over there and that is what I would like to see continue. So it was a great privilege to be on the Worldng Group and be involved in helping to guide and some sense preserve the evolution of this area and in some sense what is really desirable about it. The Working Group has been considering SOFA II as a unit for almost two year, almost for really 10 or 12 months of that intensively. I think it has come up with a very good plan. For 10 months we wrangled chiefly over land use issues, housing was going to be a priority, how do we allow commercial in there, neighborhood retail was a big one. Ten months Page 18 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3o 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 46 off and Staff synthesized all that into what amounted to a very good plan. This is a draft plan that was given to the Worldng Group when it recommenced in mid-February and what you have before you labeled as the Working Group Plan now is really the rework of this Staff plan and the democratic process and the Working Group. We had a wonderful collaboration with each other, we didn’t always agree but in the end there was a compromise. Not everybody got everything they wanted but everybody got something. I think it was a great process and I want to defend its product here. It therefore surprises me to see this being labeled the Worldng Group Alternative given its heritage with Staff, the 1.15 FAR, that was the maximum in here, various setback, other details that we worked on. I would like you to consider whatever Staff proposes as their alternative very carefully. It is a last minute thing that came upon us without warning and greatly to my surprise and not a small amount to my disappointment. First of all the plan does guarantee housing contrary to what our newspapers might lead you to believe. In fact it favors it by a ratio of almost two to one at the minimum. To the point where you build a 1.15 FAR building you can build entirely housing. You can get .40 of that as commercial if you wish and I think that’s wonderful in the area. It adds to the eclectic-ness of it. I am ldnd of bothered that the report, page 5, says that the plan will not meet its housing goals. Number one, we have to wonder what those actually are. There are some straw men put forth, 140 units for this area making up for the balance of a 300 that the clinic allegedly displaced where it is. I have to question that because where the clinic displaced the Hubbard Johnson Lumber Company next to it was a pet hospital, a hotel and so on and of course Town & Country Shopping Center. Nobody is doing housing over there. I am very satisfied in Phase I the clinic properties are going to be redeveloped to replace the housing that the clinic displaced when it was there not withstanding conversion of some of SOFA I’s vision from multi-family to office. In fact twice during the latter part of the process I asked Staff point blank, will our plan achieve the housing goal, the 140 housing unitsin SOFA II. Twice, yes it will. I have that on tape and I am very puzzled then to hear repeatedly that it will not. I am wondering what has changed. I know the SOFA Working Group Plan is not, some other perception must have. Economic issues have finally come to the fore. Several of us Worldng Group Members have asked for numbers during the plan. We haven’t gotten them and I must honestly admit that this plan is based not on any kind of analysis but upon a more feel of what we think we’d like. We don’t know how much traffic this will generate, how much additional demand on utilities and so on, although, it is claimed that this is covered in the EIR for a much greater density. Yet I am uncomfortable as an engineer, my day job, not knowing exactly what I might be agreeing to here. My final comment is that if this Commission objectively finds that changes are necessary to this plan,, and has recommendation for them, please remand it to the Working Group process so that we can finish what we have begun so well and set a very positive example for the next coordinated area plan process. Thanks very much. Chair Burt: Thank you [Shalama] Rubinfien to be followed by Hal Loft. Ms. S. Rubinfien, 501 Kingsley Avenue, Palo Alto: I am not a member of the Worldng Group but of the USNG Board. I am spealdng tonight in support of the draft plan as you have it Page 19 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3o 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 designed by Working Group and Staff because it is a very measured and responsible answer to the priority of housing without oversetting all other ldnds of neighborhood considerations such as traffic and parking and compatibility. Now we hear that this kind of nuanced vision, if you want to call it that, is something we can’t afford or so we have just been told. In fact the implication is that the only kind of housing we can add into SOFA II that has any significance at all is by way of some indigestible mass or two. This is according to one set of figures. We have heard from Mr. Justman however that if we look to long term investment then it is quite feasible to think in terms other than the kind of mass that we know is on the drawing boards facing us today for this neighborhood. I think that probably your next job is going to be as deep and profound an investigation as you can make into these economic issues and sort them through further. Certainly the first view that we must have 17 or 20% or whatever it is on investment and that should happen within a year and one-half or two is a sort of knee-jerk reaction probably fostered by the economic climate we just so recently enjoyed. But that need not necessarily guide us for the future. I think it is incumbent upon you know to look to see how to keep this vision which is admittedly by all parties a good one and see that we can afford it. Thank you. Chair Burt: Thank you. Hal Loft to be foltowed by Elaine Meyer. Mr. Hal Loft, 1020 Ramona, Palo Alto: I am a member of the University South Neighborhoods Group Board and I am also a member of the SOFA II Working Group. I think the discussion has been focusing largely on issues of economic viability. I would like to focus on a couple of those aspects. I was struck by the opening comments from Lisa Grote about the fact that there .are current applications in process with the existing 1.0 FAR. Some people obviously feel that that’s viable. There are certainly issues in terms of potential profit because that is what drives people to make change. We need to think here about both the costs and the potential return that leads to that opportunity for profit. In some cases the costs may be too high because the land value or the land price paid for was too high. Those land Prices are often based on expectations. As all of us have seen in the stock market particularly those who bought into tech stocks when the NASDAQ was at 5,000 that was based upon future expected earnings which pushed up the price: When those prices went down nobody feels that they have a right to make a profit on those inflated investments. So one of the questions here is whether some of the problems in the economic feasibility being faced by some potential developers is that they bought too high. I own some stock and took a bath. I took it. SOFA II was not an area that was dying. It was not an area that needed a redevelopment designation. It wasn’t an area that was seen to be economically infeasible. If anything there was too much development that was happening too quickly or is of the wrong type. It has a strong infrastructure in the sense that it is very close to transit, there is a vital Downtown, a fun place to live. I love walking Downtown. It is easy to get there and I live just outside, just a little bit south of SOFA II. The Working Group offers what is really zoning plus. What Chop Keenan asked for multiple times in multiple meetings with the Working Group is more than 1.0 and it really doesn’t change things too much. But it wasn’t intended to guarantee profitability. Now near the end of the Working Group process we heard a number of concerns raised by Staff with respect not so much to the FAR issue but with respect to certain physical constraints that went in an earlier version. Some of these had to do with setbacks or whether you measure the Page 20 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 46 roof at the peak of the midpoint, etc. That created design problems, not visual design problems, but just started malting the box too small and became a constraint that was more binding than FAR. In their final version those things were relaxed. Whether we got them all I don’t know. I think Staff pointed out where some of problems were and there was a lot of flexibility in that last meeting regarding setbacks, regarding roof heights, etc., that my sense was that Staff thought that that reduced and eliminated those other constraints. So what we are talking about here now is whether one can do what needs to happen in the long run with the kind of FARs that we are talking about. We are talking about the long run. We are talking about a coordinated area plan that does and is intended to impose some constraints. That was the intent. The issue here is whether having those constraints and thinking in the long run we can come up with creative solutions. As Steve Pierce pointed out most of his problems are driven by the parldng constraint to self park onsite. Parking is important but there may be nearby sites that one can have developed parking availability. For example, as Ole just pointed out, if the City moves the substation that is nice large are in which one can have a parking structure and then you don’t have to park everything onsite. So one of the issues here is to make sure that the coordinated area plan maintains a long term vision, creates incentives for people to think creatively and does not lock us into short term solutions to solve long term problems when we are going to have to live with the built structures that may be far too large and far too complex if one tries to design programs that get us to the number of units one wants with existing land prices and housing costs. Thank you. Chair Burt: Thank you. Elaine Meyer to be followed by Doug Ross. Ms. Elaine Meyer, 609 Kingsley Avenue, Palo Alto: I am a member of the Worldng Group. All the people that have spoken have made very good points. In particular I appreciate Mr. Justman’s letting a little sunshine into some dark predictions and some reality. I guess intuitively, if you own a house in Palo Alto over any number of years you know it increases in value, you know that property increases in value over time. I appreciate his analysis. What I actually want to address is a procedural question. To begin with Steve Pierce’s document says that it is addressed to the Worldng Group. It is not. It was not. I didn’t receive a copy until I received the packet for this meeting over the weekend. I believe a number of other SOFA people also did not receive a copy of it. It has not been studied or vetted by the Working Group. The analysis may be true, it may be fiction and likely it is a combination of both. The important point is this document has not been seen by the Worldng Group. It is not a Worldng Group product. I hope the Planning Department won’t include it in the packet that goes to the City Council. The City shouldn’t be giving the appearance of promoting selective interests or businesses and attaching it to the report does give that impression. The way this started is that at the very, very last meeting of the Worldng Group when we had an extended meeting that was intended to help us meet the City Council’s deadline, Steve Pierce presented what I think was two hours but maybe it was an hour and one-half talk with spreadsheets on an overhead on the wall. Lots of numbers, lots of assumptions and I suppose maybe a couple of people understood what he was talking about. I think most did not. When you have a meeting when you are working on a deadline, a very public deadline, and somebody takes an hour and one-half or two hours, again I wish I remembered exactly, out of that meeting Page 21 6 7 8 9 10 11 12 13 14 15 16 17 18 .19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 46 1 you wonder what is going on. I will just give you my own opinion which is that I thought he was 2 trying to prevent this from finishing the job in order to discredit the Working Group’s decisions. 3 In other words, if my side doesn’t win nobody gets to play. However, we did stay late, quite late, 4 and we did get done. i hope you take the results seriously as we did in working on them. Unlike 5 SOFA I this report reflects a little more of what the neighborhood wants. It is not a very large area and give it an opportunity to give it a few years and see how it works. If the neighbors have their say on how it should be developed many compromises were made andit is by no means the resident’s opinions that prevailed. It is a very good document and I hope you will give it the respect that it deserves. Thank you. Chair Burt: Thank you. Doug Ross to be followed by Curt Peterson. Mr. Doug Ross, 909 Alma Street, Palo Alto: Good evening. I have had a business in Palo Alto for over 20 years and I own a piece of property on the comer of Alma and Channing which is developed under the PC process. It is my belief that the Working Group does not represent the majority of the property owners and tenants in the area. An overwhelming majority of the commercial property owners and tenants with the larger parcels and the parcels that have some development potential do not endorse the message behind the Worldng Group. I am not saying that they are rejecting it entirely but I think they certainly want the options left open for the PC process. These property owners and tenants, a partial list of them includes, IDO, Keenan, Roxy Rapp, Santana, Hill Glazier, [Palo Alt]o BMW, Ole who spoke earlier, Mark Anderson and several others. The question raised in the Staff Report is what is the City’s vision of the SOFA II Area. A simple overview leaves one two choices, do you want housing or do you want minimal growth? The Council policy framework for the area was to create additional housing opportunities. These goals are reinforced by the Comp Plan and the Draft Housing Element. Both of which support housing in this area. The SOFA II Area has a unique opportunity given its proximity to transportation, which is not available to other areas in town. Having a plan that encourages housing is appropriate. Having a plan that encourages laousing without being economically feasible is inappropriate. Given the parcel sizes within the area and the independent ownership of the land there are only a handful of sites that are really available to develop housing. The Working Group desires to protect the character of the area at the exclusion of housing. Housing opportunities are directly related to parking. To achieve the housing goals contemplated by the Council framework requires underground parldng which increases the costs for the housing. I have reviewed the economic analysis prepared by Steve Pierce and concur with the findings. The Working Group densities will not produce any meaningful housing in the area. They are barely over what the existing zoning allows, 1.0 FAR compared to 1.15. While various people have perspectives on pro formas and what the economic vitality of area is I think the best way to really evaluate this without a lot of studies is to look back over the last two decades to see what has really happened within the existing zoning ordinance. The new recommendations are not significantly larger than those. There has been no new housing except for the two PCs, the SRO and the development I did. With that exception there has been no housing. So if you want to fast for~vard, and we went through several boom cycles in that period, and we didn’t get much out of it in terms of the Page 22 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 housing mandated by the plan. I believe the retentions of the Planned Community Zone is vital for the City to have flexibility to evaluate projects on their own merits and public benefits. The PC process provides opportunities for additional affordable housing and perhaps the only chance to add much needed parking to an area which is severely under-parked. A day doesn’t go by without a newspaper article discussing the critical housing shortage in the area. Smart growth policies recognize the importance of having housing near transportation which helps ~;educe traffic congestion and pollution: Putting housing closer to jobs and transportation is critical to improving one’s social and physical environment. Don’t let this valuable and unique Opportunity create mixed use or multi-family housing opportunities within walking distance of Downtown services and transportation slip away. We can all agree that housing is important. If we can’t build it in SOFA II Area, where else is there? Thank you. Chair Burr: Thank you. Curt Peterson to be followed by Carol Jansen and then we will take a ten minute break. Mr. Curt Peterson, 909 Alma Street, Palo Alto: I am also a member of the Palo Alto High Street Partners. We currently have a Planned Community Zone application in process in the SOFA II Area. We have kind of hit on this a lot but I think the real question is do we really want housing? I think that the Working Group did a good job and I think based on the tools that they were given I think that they felt that they were doing the right thing. I think the economic analysis really is fairly critical. Steve’s is very close. Numbers can bounce around like the exact land cost really depends on what you can buy it for. Herb Borock brought up a sale price 20 months ago. What can you buy land for today? The Housing Element talks about land prices in the area being $150 t0 $167 per foot. That is kind of a realistic number. They are actually probably going up fi:om there. The $140 Steve used was fairly reasonable and I think his costs for construction were reasonable. His was a for sale program and that is the way a lot of developers look at it particularly for condominium. The rental program Mr. Justman brought up, one of the points on Mr. Justman’s, I think maybe we might have left out some of the expenses because he was saying $2,000 per month for rent and carried that through as a gross number but there are expenses, property taxes and maintenance, etc. that usually knock offbetween 18 and ~25%.of.actual rent number, So -that gets it bacl~ down t0 m0re to four .or five percent return that you would have on an ongoing basis. Part of thew0blem with a four or five percent return that basically is a return on your pure cash. So that would mean you would have to put all of your money in. If you want to go out and finance anything you are going to have to pay, about the best that a developer can do maybe Mr. Justman can do better but, seven and one-half or eight percent is about the best you are going to do, So if you are earning four to four and one-half percent and you are paying seven or seven and one-half percent you really can’t leverage, you can’t build a large project. You have to just build what you can afford to do with your own cash. So that usually doesn’t encourage development. That is probably why over the last 20 years there hasn’t been much housing development. So we.see the question as do we want housing? We got involved in the project because the prior developer had a project that we felt that the neighbors were not that excited about and there were in fact some of the housing Working Group folks, we have quotes from various places where they said we need places for people to live, we favor high density housing to maximize yield. So it was our understanding that if we put in all housing that it would be something that everyone Page 23 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 2o 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 42 43 44 45 46 would support. The size and the mass is an issue and I think that needs to be dealt with and we would like that to be dealt with on a PC basis. The limitation of a 1.15 FAR simply won’t work for for2sale housing. Even a 1.5 FAR will not work for for-sale housing. So then the real question comes back. Do we want housing? If we want housing in SOFA II we need to allow the PC to continue or we need to raise the FAR, one or the other. This program will not do it. If we do want housing we think that is the right way to go. Thank you very much. Chair Burr: Thank you. Our final speaker before the break is Carol Jansen. Ms. Carol Jansen, 575 Hawthorne, Palo Alto: Good evening Members of the Planning ’ Commission. I am worldng with the High Street Partners for the residential project at 800 High Street. I would just like to make a couple of comments with regard to some of the initial.Staff comments on the economicsofproject within the area and the basis for the original conception that the SOFA II Plan was "economically feasible." The actual example that was given and many of the examples that have been used here this evening relate to mixed use projects. I think it is important to note that mixed use.and all residential projects have a very different set of economics. As you recall the previous Roxy Rapp proposal on the Peninsula Creamery site came in as an all commercial project and then added 35 rental subsidized housing units for teachers as an addition to that original project. That was able to be done at that time during that market for offices simply because the office carried it. I think that is important to note. The second thing is that in many of the discussions about the SOFA II Plan we have talked about it as if there were a oneness in terms of the deliberation of those. I was there the evening that the final vote was taken and am also familiar with votes that were taken in the past. We had a six to five vote on two very critical aspects of that plan. One was whether or not to retain the Planned Community Zoning which lost in a six to five vote in the previous discussion with the SOFA II Group. The second was the final vote which after the economic feasibility analysis which Steve Pierce presented and which I believe are totally on target, after those were presented there was a great deal of discussion at this group and it was a six to five vote as to whether or not to keep the plan and continue to review or get more economic analysis or to send it forward, You even had as diverse backgiounds as people as Dave Bubenik and Chop Keenan voting in the same place on that particular issue. I think that is important for the Commission to note because the Planed Community Zoning in particular is the only real zoning option that we currently have to allow residential in the City of Palo Alto. Finally I would like to make a couple of comments about the Housing Element. On February 4 the Housing Element draft was considered by the City Council. I would just like to make a couple of comments. One is that in that report there is a commitment from the City Council to convert non-residential to residential which is something that is essential in this community if we really want to see any more housing. Another commitment was made to providing more market rate housing and to allow higher densities within 2,000 feet of a transit station. All of those are on record. At the same time that that February 4th report was done on April 19th I believe the first administrative draft of the SOFA II Plan came out which if we believe the economic feasibility analysis that have been presented here tonight will not generate substantial new housing within the area as presented. In the Housing Element that is proposed there are 1,100 new units that are suggested could be built within the entire City of Palo Alto in under 21 Page 24 1 projects. One of which is the 800 High Street project which is shown as proposed for 61 and 2 application pending or 61 to 65 units. I think 1,100 units in the City as a whole even identified 3 with all of the options here shows just how few options we really have for housing. So I urge the 4 Commission to keep that in mind and to basically remember the roles of the Housing Element in your consideration of the SOFA II Plan and to keep that PC optign open so that you will get some housing in this community and especially near transit stations. Thank you. Chair Burr: Thank you. We will adjourn for a 10 minute break and then reconvene.’ Thank you. Chair Burt: The Commission meeting will reconvene at this time. Our next speaker is Jean McCown to be followed by Tom Harrison. 5 6 7 8 9 10 11 12 13 Ms. Jean McCown, 527 Seale Avenue, Palo Alto: Good evening Members of the Commission. I 14 am here tonight as a part of the High Street Partners group representing them. I wanted to talk 15 not specifically about their project in any respect but really about the broader policy and process 16 issues that are associated with the potential for housing development as it relates to the SOFA 17 Area. What I would hope is that as you proceed forward in your recommendations and 18 considerations going forward to the Council that you keep open the opportunities for 19 consideration of serious substantive housing projects in the SOFA Area. The enormous potential 20 of that area as a transit oriented location for housing is self evident. Many people have 21 commented on that tonight. It is probably one of the most special areas in the community in 22 terms of the opportunity that it presents the City for that type of development. I think a project 23 like 800 High Street, and that is the only time I am going to mention it, is a serious substantive 24 proposal for housing. I would hope that whatever process comes out of this allows for projects 25 like that to be brought forward and be taken through the most complete process which we know 26 is how we would do it in Palo Alto to really consider the opportunity that that represents. I think 27 the City has a unique window o£opportunity right now with the respect to the possibility of 28 housing projects being developed in the Downtown area. In the 20-some years that I was 29 involved in working on these issues there were very few, very rare moments, when any housing 30 project was able to compete to be the use made of a commercial site Downtown. That just has 31 not been part of the history. I think you can count them on a few fingers of one hand the number 32 of projects that were able to be developed on sites that were fundamentally commercial sites. 33 The most recent few years, as people mentioned, the dot.com boom has been obviously one of 34 the most extreme periods in terms of the pressure and the desirability of office uses as the use 35 that commercial sites would be put to. We have seen in a way a sad but perhaps beneficial 36 significant slump in the office market place. There is enormous amount of office space in the 37 area generally and it is going to take a very long time before that becomes a competitive 38 marketplace again. So I think you have here a situation where you may see a chance for housing 39 projects to actually be competitive in terms of uses of commercial sites Downtown. I know that 40 the housing policies, the Housing Element, and City Comprehensive Plan Policy has always 41 looked for opportunities to steer commercially zoned properties into the housing arena. There 42 have been very few occasions when that was really feasible. I think it is feasible now for a 43 period of.time, for probably a few years hopefully, where the depression in the commercial 44 marketplace will be a benefit to the possibility of housing. 45 Page 25 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3o 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 So I would really urge that the City seize that window of time because it probably will go away again and housing projects will not be able to be as competitive as a use of land for landowners as they are right now. You have heard it from several speakers before me, I would certainly urge you to retain the PC process. Again, when I think about housing projects I think many of them, the major ones, have been developed if not most under a PC process in the Downtown area. I don’t know that it is right right now to arbitrarily decide as the Staff is suggesting to you that 1.50 FAR is the magic number over which there couldn’t possibly be a project that would be a successful project and a successful addition to the neighborhood. So I would urge you to keep the PC process and don’t go with some kind of an arbitrary cut off. That is precisely what the PC process enables you to look at. Finally, don’t decide these major policy issues, which I think are in front of you and in front of the Council, by default which sometimes happens when we delay action for the benefit of further analysis or further studies no matter how well intended that is. So I would urge you to move this forward with your advise and your recommendations to the Council which will obviously compliment the information that is in ttie Worldng Group proposal itself and frame these policy issues in a way in your referral forward to the Council in a way that they can grab a hold of this and give us direction on which way we want to go on this critical housing question. Thank you. Chair Burt: Thank you. Tom Harrison to be followed by Mark Sabin. Mr. Tom Harrison, 232 Homer Avenue, Palo Alto: I am a member of the SOFA II Committee. I own property on Homer Street, ran a company there which was 65 years on Homer Street. Also I had a store in Stanford Shopping Center. So Iam one of the people who is addressed in the SOFA II as a friendly retailer or a businessman. I was asked to join SOFA II because of that. I have some problems with the report and those who were on it know what my problems are. That is that I want to preserve commercial property. I have a 50 year overview of my area, the SOFA II Area, and commercial property has been shrinking there for some time. It is going to disappear and once it disappears it isn’t replaced. After you reach a threshold where you don’t have enough commercial property then all businesses cease and it just will fill in with housing. Now one of the goals of SOFA II was to try to develop friendly neighborhood retail and other commercial services. The way it is written and the way I read it, and I have sat down and read it several times, is that you have to if you have new development you have to have a retail part of it. I agree with that, it’s fine, I’ll go along with that. But all those which are grand fathered in will lose their grand fathering once they lose their tenant or their lease and they will slowly be forced back into retail. Now this may sound very nice but I own only 5,000 feet. The beautiful thing about SOFA II is that it is owned by small business people or small land holders. It is not one of those places where developers rushed in and built huge things all over the place. If you are faced with only renting to retailers you are doomed because retailers cannot pay the developmental costs for you to fix up your building. I fixed mine up. If you have ever walked my area or gone into my building, you are welcome to take a look at it. I spent well over half a million dollars fixing it up and I have an office person in there. I have an advertising firm. I couldn’t have done it without leasing it to them. So what happens is if you say you can only develop this and use it for retail, and retail rents at about $1.00 to $1.25 per foot, you just aren’t going to get development. You aren’t going to get your neighborhood friendliness. What I Page 26 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3o 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 46 would have like to have seen was a real flexibility in the use of commercial space. No rules. Just have the landlord rent to anybody doing.anything at any time. The marketplace will take care of it. Your retail will come back. It will go away for awhile, it will come back. Whenever cities try to create certain things it seldom works. In fact San Jose, Downtown, is a great example of billions of dollars creating something which is vacant. So I urge you to really look at SOFA II, the commercial part of it, it doesn’t make sense to me. It just doesn’t make sense. What you will do is you will get rid of the rest of the businesses in the area. You won’t do it immediately but the long term effect will be what I feel basically is going to happen in SOFA II Area, it is going to become housing. It will be higher and higher denser housing, not affordable housing, we will just get housing. We have one group of developers looks like to me are going to replace another group of developers. I personally like multi-use development. It has bad features, yes, but I prefer to have commercial and residential together. I don’t want to see it developed and changed into just a high density place that rents for a lot of money. We have plenty of that in Califomia and there are lots of places for you to go and live. I’d like to see SOFA II remain like itis. It .is a beautiful neighborhood. I have spent 50 years of my life there and that is how I want it to remain. I know it will changed but I was hoping that SOFA II would not allow it to Change radically, go big development office or go to the other side all housing. That is what I expected out of the SOFA II Plan. I am not sure I am going to get it. In fact I feel I won’t, thank you. Chair Burt: Thank you. Mark Sabin to be followed by Paul Kelleher. Mr. Mark Sabin, 4274 Wilkie Wag, Palo Alto: Good evening. My concern with what is being proposed has been a concern of a lot of folks here is the lack of flexibility. I suppose there are ways where at the lower FAR you could do something that is economically feasible but I think to a certain degree is in conflict with meeting the needs of this community. I think we need to look bigger at that. The litmus test has to be higher than just. economic feasibility. If we keep such a low FAR basically we eliminate any possibility of having higher density housing. And if we eliminate that possibility or eviscerate it, which I think this would do, what you basically have limited high-end housing and nothing that address th~ needs of the folks in the middle. Nothing that addresses the needs of people who might be working Downto~vn, or might be interested in taldng transit or taldng advantage of those things. There is a very large segment of critical contributors in this community who are finding it harder and harder to live here and not just for a short time but for an extended time as well. If you just build 700 square foot duplexes ..... [break in recording] ..... have the opportunities are these contributors to root in this community. You don’t have the opportunity for those people to perhaps sit on committees like this and really make a contribution to this community on a long term basis. We need to be mindful of that. We need to be mindful of creating those opportunities for the people who not only want to live here but are really struggling to. We are in a recession and I am in the process of trying t6 find what has been talked about as attainable housing. Basically what I’m faced with is even in a recession I am looking at probably five to up to 20 people competing for that same unit and looking at anywhere from 10 to 30% above the asking price, in a recession. That is what I have been faced with and that’s what I have been beat up with so far in my search. If we aren’t doing something and taking the opportunities here that we need to to keep this community vital then we are digging a deeper hole than we are already in. We not only need the higher PC levels just for the housing but unless we have that we are not going to be able to build a structure that is also going Page 27 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3O 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 be able to have underground parking that is going to address the needs of the people who live there but even perhaps address the needs of the people who might be doing business around there and having a need to park. If that isn’t done then those folks are going to be parldng over in the outer neighborhoods and that just raises the ire of those neighborhoods and creates even more problems. So we need to have a process that is flexible enough that is going to maximize the utility and not just be economically feasible if we are really serious. I hear politicians and as an ex-politician myself, talking the good talk about providing housing, attainable affordable housing in this thing. But if we are creating policies that are going to thwart that from ever happening this town’s vitality is in trouble. I would urge that what you propose that you give it the opportunity to have some flexibility and help us meet our needs in this town. Thank you. Chair Burr: Thank you. Paul Kelleher to be followed by our final speaker Jeff Mayer. Mr. Paul Kelleher, 426 Homer Avenue, Palo Alto: I was a late addition to the Working Group for SOFA II. I would urge you to support the Working Group’s plan. It does represent higher density than the current zoning that we have on ttiese parcels. It does represent a push toward residential uses. That is really challenged by some circumstances which we were in the area . before we got there. The whole feasibility discussion is kind of a quicksand because we have seen a very small picture of one particular type of parcel down there. It would really be a mistake to apply those numbers across the whole spectrum. Mr. Justman has pointed out how you can look at these things differently for longer term investors but I would like to point out a couple of things. It is no surprise that the small lots are tough to do with higher density residential housing. Even Mr. Pierce has said this is not exactly a startling conclusion. What has kind of been missed in all this is why the starting point for these land values is high. It is because we have zoning that allows office uses already. The office uses are generous to the smaller lots because it allows you in some of these auto shops for example to plunk in 100% office space in what space they have and that pumps up the underlying land value and makes any kind of residential conversion challenged by that starting point. That’s not something that you can overcome by high FARs as Mr. Pierce has shown. Even the 3.0 number on small Bill Young lot does not generate economic feasibility there as for-sale housing.. So one starting point would be to ban all theoffice Uses that are happening there now. That was kindofn0n-starter for the Working Group. We weren’t going to do that. So it is not surprising that we can’t make small lots easily converted to residential housing. If you take a longer term view of this you have to look at those small lots as potentially bigger lots down the road. There may be lot combinations, there may be projects that combine with each other and that is something that we have to look to happen to some of the small lots if you want to get higher densities. On the other side of the coin you have the bigger lots. If you want to look at the economic feasibility of a bigger lot take the 800 High Street properties and ask Mr. Pierce to do exactly the same feasibility study on those lots. I think you will be surprised by what happens because if he bases the land value on the potential office conversions like he did with the Bill Young property he is only going to have about 15,000 square feet of office space to build land value there and that is going to be a pretty low starting point. I think you will find that the lower density housing options would be economical on that site if you used exactly the same feasibility analysis. So that’s wl~y I think it is inappropriate to have that one feasibility snap shot played across the Page 28 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 46 whole area. If you want to see feasibility on 800 High Street use the same methodology and I think you will be surprised. The last point is that a lot of the buildings that have been taken off the table as far as long term housing potential are the recent conversions to offices that were done, really propelled to conversion, by the office boom around here. So you have a number of these buildings, which I consider more like disguised cinderblock structures parading as office buildings. Long term, are those viable for ever? I don’t think so. I think they are in play. If you take a longer term view of the area those are potential residential conversions not in the existing cinderblocks but in another form sometime. So I also think when you look at these housing goals and whether we achieve them it is not appropriate to just ’x’ those lots out and say they are gone forever. Just as they have evolved into office uses now over a reasonable planning horizon they can further evolve into residential uses. I don’t think any of us can predict now what the trade-offs and economic comparison will be between residential and office and retail uses I0 or 15. years down the road. All you can do is do reasonable zoning nowand get the right FARs in there so that the thing doesn’t destroy our neighborhoods around there. Thank you. Chair Burt: Thank you. Our final speaker is Jeff Mayer. Jeff is not here. Thank youvery much. I would like to extend appreciation to all the member of the public who have commented tonight for their very thoughtful and valuable comments on this subject. It really does contribute to the entire process and we appreciate everything that you have had to say. At this time as the Commission starts wading into its consideration we have some broad issues that we need to consider. We have timelines in which this is scheduled to go to Council. At this time I should close the public hearing as we go forward in this discussion. Would Staff care to comment on the constraints that we have and the options we have on being able to complete this item as we are already at 9:40 with one more item on our agenda tonight? Ms. Grote: This is scheduled to go to the City Council on May 28, Looking at your agendas coming up if you were to consider this further than tdnight;.May 15 is full, May 22 is the Zoning Ordinance Update Study Session. It would be difficult if you continued it to May 22 to get it to the City Council on May 28. There wouldn’t be enough time to turnaround Staff Reports and minutes. So if you were to consider continuing this it would probably need to be a special date on some day during the week other than a Wednesday. So we would need to talk about that. Chair Burt: We have the ZOU on? Ms. Grote: Chair Burr: Ms. Grote: On May 22. On the 22nd. Right and that is on the Industrial Manufacturing Zones which was continued a couple of times from April 10 to another date in May and then May 22. Chair Burt: Karen. Page 29 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 Commissioner Holman: static schedule? Ms. Grote: It is. The libraries that we have next week, are those all set in stone? Is that a Commissioner Cassel: We obviously can do some work tonight. Can we meet next Tuesday evening? The preparation has been done tonight. Ms. Grote: .Unfortunately, Tuesday evening I have a policy and services meeting that I need to be at. Monday is City Council. Thursday might be possible if that is possible for you. Chair Burt: I have been notified that the last speaker who had been waiting quite a while has returned and out of fairness I would like to reopen the public hearing and give Mr. Mayer an opportunity to speak. Mr. Mayer? Mr. Jeff Mayer, 4675 MacArthur, Newport Beach: Thank you. I just want to make a very brief statement. I am with an architectural firm by the name of Gensler and we represent the property owners at 657-653 Alma Street. You may know it as the [Kraft Floral Shop] at the corner of Alma and Forest. As you may know it has been owned by the [Veccioli] family for many decades. It is an interesting property. We have one lot within the SOFA II district and one that is not, it kind of straddles that. We have been working very hard with John Lusardi and [Rich Adhocs] for actually close to three years now. They have been very helpful working with us. We started with an all office property and realized that that was not practical. There has been a lot of discussion tonight about the economic feasibility of the CUP. I think my message is that we are in the process of working very hard to make our project work. We have a mixed residential and non-residential project that is within the FAR within the SOFA II guidelines. I am hoping that we are going to be able to pull the design of the building within the pro forma of the landowner. We don’t know that yet. It is a very interesting proposition putting two land uses on two small properties. Some of the things that we might be looking for is a little bit of flexibility in terms of-moving allowable square footages between these two properties with a possible zone change. I think I just wanted to comment that I think the spirit and the vision of he SOFA II ,Worldng Group and their document is commendable. I think it is well articulated and I think overall it will serve the community very well in the long term. I cannot specifically speak to the economics of some of the other landowners. We don’t know whether ours will werk yet. We have a construction budget and we are worldng very had with a contracting firm to make those numbers work. I hope I will be seeing you in the near future telling you that they do work. That’s really all I wanted to say and thank you for the opportunity. Chair Burt: Phyllis. Commissioner Cassel: Could you tell me what the FAR is that you are hoping for? Mr. Mayer: It is within the guideline of the 1.15. We are looking to do the a little bit extra. We have I believe 10 dwelling units within about 15,000 square feet. We have two levels of Page 30 1 underground parldng which of course makes it quite challenging but we are parked from what 2 we can tell. 3 4 Chair Burt: The two lots combines are 15,000? 5 6 Mr. Mayer: The total square footage on the site, the buildable area is about 42,000. The 7 footprint on the site is around 11,500 1 believe. I have the numbers back in my office. 8 9 Chair Burt: I’m sorry, could you say that again? 10 11 Mr. Mayer: The total buildable square footage that we are designing to is 39,000 square feet 12 actually. I am looldng at my notes. It works within the footprint of the two lots working 13 together. 14 15 Chair Burt: So close to an acre? 16 17 Mr. Mayer: Not the site itself, no, but the buildable area that can be built with on the site, 19 Chair Burt: So the site itself is about 39,000, is that what you said? 20 21 Mr. Mayer: Yes, we are going to be building 39,000 within the regulations. 22 23 Chair Burt: I see. Thank you. 24 25 Mr~ Mayer: Thank you very much. 26 27 Chair Burt: Okay. We will close the pubic hearing again. Steve, any further thoughts on this 28 time constraint that we have? 29 30 Mr. Emslie: It really looks like the only alternative is a special meeting next week in order forus 31 to meet the deadlines and the turnaround and staying on the schedule. It looks like Thursday 32 would be the day that would have no conflict with Staff and other meetings that were scheduled. 33 We are not sure if we would be able to have this room. We may need to meet in the conference 34 room. 35 36 Chair Burt: How does Thursday work for the Commission? 37 38 Commissioner Cassel: It can’t be before 7:00 but I can do it at 7:00. 39 40 Chair Burt: Okay. I think this is important that we be able to fully consider these important 41 issues. So next Thursday at 7:00 we would convene a special meeting on continuing the SOFA 42 II item. Steve? 43 44 Mr. Emslie: If the Commission is intending to continue the discussion, at this point I did have a 45 few comments I just wanted to wrap up with. 46 Page 31 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 2o 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Chair Burt: I think we have some questions as well as your comments. those comments now? Did you want to make Mr. Emslie: That would be fine if that is the Commission’s pleasure. I just wanted to provide a little bit of the procedura! framework to help the Commission put this into perspective. What is before you is a collaborative effort by. a divers group of stakeholders that the City invited to give this Commission and the City Council its advice. They went and set about doing that and spent many years pouring over details, working with Staff coming up with recommendations and the effort is laudable and to be commended. Ultimately, this process depends on two bodies to make a decision as required by state law and our own local ordinance. This is a Coordinated Area Plan. In order for a Coordinated Area Plan to be adopted it must receive the recommendation of the Planning and Transportation Commission to the City Council who must consider that recommendation. Those are the two decision points in this. So it is very important that the Planning Commission take this advice, consider it, you obviously have a very clear division. In the comments that you have, you have two distinct points of view which knowing Palo Alto is not unusual. Healthy disagreement, professional disagreement is really a way of life and it ultimately contributes to, I think, the best land use decisions because you really are considering a variety of points of view. From Staff~ s perspective, just to kind of maybe leave you with a couple of points to be thinldng about as we move into the discussion. The economic feasibility is obviously an issue that needs to be dealt with but before we get into that just a word about the vision. I think the vision is sound. It talks about creating an environment that would be very appropriate for Palo Alto. The problem is in some of the quantified goals. The housing goals that are listed in the plan talk about achieving a number of 300 units in both the SOFA I and SOFA II areas. The balance that is remaining since we were able to achieve a great deal of housing in SOFA I, very fortunately, leaves as you heard 140 units to be constructed in SOFA II. What we are hearing and this is where I think the economic analysis, while perhaps it is subject to individual opinion and perhaps debate, at least it is showing that there is some disagreement as to whether or not you are going to achieve that goal. I think in the interest of this Commission giving thoughtful recommendation to the ultimate decision-maker, the City Council, I think it is important for that to be considered and weigh the evidence that you have before you as to whether or not you think credible evidence has been submitted that will ensure that you are going to make that goal. There is another important piece of information that I wanted to emphasize to the Commission and that is in order to approve a Coordinated Area Plan there are very specific Ordinance requirements. It says that it needs to work in conjunction with market forces and not against it. So in some respects you are hands are tied. You are really obligated under the Ordinance to consider this. So a test of the market conditions and market current is important in fulfilling your obligation under the Coordinated Area Plan Ordinance and giving that recommendation. So even though there may be some disagreement I think you have to consider all points of view and make sure that you have satisfied yourselves that you have a good test of the economic conditions because you are going to have to make a finding that this plan works in conjunction with those. Page 32 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 46 Then I think the last two issues that I think that are kind of related to the economic realities that we are hearing some disagreement over, two issues are the PC, whether or not PCs are allowed or not. In some respects the PC is the ultimate safety valve that you could kind of defeat the whole economic analysis question by really relying on more case by case analysis as PCs come up. They are reviewed and you could take the temperature of the economics at the time. That is what the City has done historically over the years by using the PC process as a way to evaluate the benefits and really take a snapshot of what is going on economically. So that is an important factor, I think, in you deliberations as to whether or not the PC stays or is eliminated as an option. It is one way to address the economic realities as they will change and continue to change and I think probably in a far more rapid cycle that we are used to in the past. I think everyone agrees that that is going to be the more current state of affairs. The last issue that I think the Commission should consider is SOFA II has really been considered as a unit. These rules, these guidelines, these recommendations apply over the whole area. I think one c~f the revelations that really came to Staff and the Working Group as We discussed is that there are fairly limited opportunities where economic value is depressed enough that the improvements that are on those lands are so undervalued or so lack intensity that they have no economic value other than to be removed and the site’s intrinsic land value is what is important. Those sites are relatively few because there are as was mentioned many times in the testimony you have uses that have been converted over, properties that have been held by property owners for a long time, long term investors that have taken properties and made them very viable and very economic. I think was occurring to Staff is that there are probably relatively few that could not be shined up and buffed up to the point where they are economic and that they probably present the greatest opportunity for redevelopment because they are large enough to support the kind of infrastructure, parldng primarily, to allow for their reuse. So think in terms of maybe a more specific view of the development potential and not rules that would apply throughout the whole area. I think those are the thoughts that we would like to leave you with as you enter your deliberations. Chair Burt: Thank you. Bonnie. Commissioner Packer: ~ have a procedural question. front of City Council? That is my first question. What is magic about the May 28th date in Mr. Emslie: There is nothing magic about it. We set about to establish a schedule for all the Boards and Commissions to weigh in on this, the ARB, the HRB, now the Planning and Transportation Commission culminating with a Council hearing. Kind of preserving that date is fairly important because Council’s agenda is like yours, booked up far in advance. So it was important to preserve a date so that we cbuld keep momentum going and have information be fresh and not call upon people to come to countless hearings and make each hearing important and count. Commissioner Packer: So there wasn’t anything external except the normal processes of things. Do we also have an option, if we decide that there needs to be more work, to send this back to the Working Group or not? Page 33 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 "40 41 42 43 44 45 46 Ms. Furth: I am sure that you can work with Staff to ask for additional information but at this point the Ordinance says that it is in front of the Planning Commission for you to hold a hearing and consider the evidence from the public. It also says that the Director dan refer the matter to other bodies to provide you with additional information. That is what happened with the ARB and the HRB. I suspect the Director has some freedom to solicit additional information from the Working Group but the plan is in front of you now. The matter, the CAP is in front of you now. You can always ask for additional comment. You can ask the Director to have another meeting of the Worldng Group to provide you with additional information but at this point they are advising you the matter is in front of you. Chair Burt: Karen. Commissioner Holman: So maybe one more procedural question. SO would it be possible also for the Planning Commission to make decisions and recommendations about certain aspects of the plan, forward those on to Council, but Caveat the one or two or three things that we think do need more study So at least the bulk of the information could go forward? I know that doesn’t make a complete ordinance but at least it does give good direction on a majority of the plan. Ms. Furth: What the Ordinance says is that you shall make a recommendation on the plan. It also says that the City Council can accept that plan, it can .reject it or it can modify it. So they are not bound by what you do. If you find yourselves unable to make recommendations on parts of it then you could tell them that. I am sure it is preferable to have a complete set of recommendations but if you felt unable to do that and believed it was more important to get your partial recommendations to them, I think you should just be clear as to whether you were asking them to send it back to you again for further input. This doesn’t contemplate that. Chair Burt: If we were to request an economic analysis and concurrently with that make some recommendations to Council on broad issues that are not dependent upon the economic analysis, would then there be the opportunity for this to be an interim review by both the Commission and the Council and then subsequently have a final review after we have received the economic analysis? Is that procedurally appropriate? Ms. Furth: If you want to give them a progress report and I’m puzzled because I am not sure what the answer is and the Director may have some useful discussions. The Ordinance contemplates that you will get the information you need, you will make a recommendation and it will go on to them and they will make a decision. They have a Council date. It is tight. You may believe that you should really have more information but you may want direction from them as to whether they would rather you just got it on to them or took that additional time. Chair Burt: Within in SOFA I we in fact did have a process similar to that. Ms. Furth: And we split it. Chair Burt: But within SOFA I we had an interim progress report where Council provided their " feedback on the general concepts that had, to that point in time, been adopted within the plan to see whether we have a general concurrence on the direction of major issues. So that is what I Page 34 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 .24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 was wonder is if we have certain major considerations do we want to have a reality check with Council prior to attempting to have the final refinements to the plan? Ms. Furth: Well, the Director is suggesting that one thing you could do is make a report to them, keep the matter still on your agenda, make a report to them and indicate both where you think you would like to go, ask for their comments and explain how you would like to proceed. You could formulate that next Thursday. Mr. Emslie: In some ways I think that is very advisable because a lot of time has lapsed, lots of things have changed. There was a lot of initial description of the goals and objectives of this. So I think it would be completely understandable that you would want to have some sort of progress report just given the amount of time that has passed. Chair Burt: Phyllis and then Michael. Commissioner Cassel: I had two questions of you and then a comment on the issue that you are talking about. The question here is has everyone received the Environmental Impact Report that was done in February 1999? I think some of the people on the Commission may not have that document and it would be very difficult not to do that. That is one issue. Ms. Grote: You have not received that as this Commission. The previous. Commission that was hearing SOFA I received it. We can make copies of it and get it to you if that would be helpful. Ms. Furth: In fact we have to because you can’t make a recommendation until you have read it, both the EIR and I think there is a First Amendment to it. Commissioner Cassel: That would be helpful. Then my other one is, in the Staff Report usually when we are malting a recommendation to City Council pro or con on an item it doesn’t say review and comment it says review and recommend. Then it indicates that if you have findings that you.want us to make that you list those findings. This Staff Report does not do that. Can you get those to us by our packet on Friday? Ms. Grote: We can get those findings that you need to make to you, yes. There is a general statement in here that the comments and recommendations will be forwarded to the City Council. We can make those much more specific to the findings. Commissioner Cassel: It usually is and I think it may help what seems to be very confusing for us is I think that level in that recommendation isn’t here and it is adding to the ability to know quite where to proceed and how to proceed. I think we need to try next Thursday to see if we can do this. If we can’t do it and we need something else then we forward it to City Council saying this is where we are at with this reason or that reason. We need to at least make an attempt and then see what happens. Maybe we don’t have the data and we will need to do that. This has been a long time in its development stage. Chair Burt: Bonnie. Page 35 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3o 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Commissioner Packer: I am a little freaked out right now because I didn’t know about this EIR and we have a couple of EIRs on the library to read and now this EIR and all these meetings. I just think that this is a bit much. If we had gotten the EIR with the report, the CAP Plan, it would have been helpful. It is really squeezing it tight is my concern. I don’t know if I can give it the kind of analysis this short a time with the other things that we have to consider by Thursday. Chair Burr: My concern may help address yours and that is I am going to have a very difficult time being able to make specific recommendations on what is an appropriate detailed plan with FARs and the specifics of the plan that are ultimately designed to be part of it in the absence of an independent economic analysis. We have heard some valuable input from several different perspectives and in the absence of an independent and more thorough analysis I don’t think we can do our job thoroughly and completely, This is such an important issue that I am going to have a difficult time being able to make specific recommendations to Council in that absence. If the Commission ends up being in concurrence with that perspective then it will alleviate your problem on having adequate time to digest the EIR. Ms. Grote: Also ifI could interject on the EIR question. That EIR has been certified. So we wouldn’t be asking for your review and comment of the EIR. You would use it as a resource or a source document but not for your review and comment. Chair Burt: Yes, understood. Michael. Commissioner Griffin: You made my point nicely, thank you, about the necessity for economic analysis. Steve just told us that that was a very vital and integral part of this decision-making process and yet I am listening to dueling economic theories, out here and not having any guidance as to will the real pro forma please stand up. I think we could stand a little help from Staff on this. Chair Burt: Karen. Commissioner Holman: I feel l!ke we are doing dueling banjos up here. We are a bit between a -. rock and a hard.place. Actually more than a bit. I guess I ha~e some questions. How long would Staff say that it would take to do an economic feasibility study and what economy is an economic feasibility study done? For what period of time? How does an economic feasibility weigh in versus the other goals of a plan? It has to be economically feasible plan but again there are other goals and vision for this plan as well. I know that there have been some comments that no development of housing, for instance, has happened in the lastseveral years. I would like Staff to comment on this. I have some thoughts about that. One is that office was allowed on the ground floor and we have had a long term boom for office development and office rates. Maybe I am making a statement but if you could comment on it. The residential development standards actually worked contrary to encouraging housing and the allowance of office as it does cyclically do it seems to me, I think Paul Kelleher made this point, it seems that the office allowance would drive up the property costs. So I know that is a lot of things at once. i guess the last point I would make at this stage would be we do have a time constraint it would seem because the reason the Council is meeting on this, it is a Special Meeting for them as well, if we don’t meet Page 36 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3o 31 32 33 34 35’ 36 37 38 39 4o 41 42 43 44 45 then as I recall it was perhaps September before they could look at this again. There are development projects in the pipeline. So it lets those just fly with the wind. So it is a very difficult situation but I think we need to consider carefully putting it off as well as continuing. Chair Burr: One of the things that I might suggest for our few minutes remaining tonight is that we focus on trying to frame the issues for our Special Meeting so that Staff is clear and we are clear on some of the issues that we would like feedback on and that we would attempt to address at that time. If we were to tonight have a concurrence on whether we think an economic analysis is going to be needed 15efore final adoption of the plan then ~hat might help frame the issues and the scope for our Special Meeting. Bonnie and then Karen. Commissioner Packer: Just on its face, this plan that is before us doesn’t comply with the requirements of the CAP Ordinance because it doesn’t have the economic analysis, it doesn’t have a program of implementation measures, it doesn’t have this Item B about the proposed distribution of all the infrastructure. It has in the back, and I can understand Staff’s work load, but all the definitions are just lifted out of the Zoning Ordinance but are not related to the CAP. Details like that. It is really not a complete document so there is so much more that needs to be done. I would agree that we need an economic analysis if nothing else to be in compliance with the CAP Ordinance let alone help us analyze this. If we have to go to September to do it right that would make sense to me. This is important, there is a lot of work that has gone into this by the Working Group. We wouldn’t want to say oh it’s okay, we want to put in the analysis that it deserves. Chair Burr: Karen. Commissioner Holman: Actually, I would like some response from Staff on some of my questions regarding how does it take to do an economic feasibility and all that sort of sm~ ff. Mr. Emslie: The economic analysis would most likely go out so there are many firms that specialize in this area, very economically oriented firms that link land use decisions to the economic realities. It is a common question that gets asked in land use as you well know. So we would, given Staff’ s work load, given the commitments we have made. in achieving the Council’s top five priorities, we are fairly booked up. So we would most likely look to bringing in a firm to do that. Again it depends on the availability of the firm and their current work load but I wouldsay three months would be kind of a short period of time, possibly longer if the firm is backed up and couldn’t do it as quickly as we would like. A little bit about the nature of the report. I think it would look at a broad range of scenarios which you have heard here. I think some of the dissidence you hear between the two pro formas is really different relationships with the economics of the land. Clearly land that has a tremendous amount of equity in it is going to develop differently than that that has no equity. Coming in, land with viable improvements is going to cost out differently than those that the improvements are a liability that actually add to the land value. So I think it is good to look at that full range and that perspective to help put into focus what ultimate land use decisions you are going to make. So I think it would kind of take that form and give you a more broad Page 37 1 2 3 4 .5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3o 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 spectrum look at the different economic factors. I understand Wyrme would like to answer second part of that question. Ms. Furth: I heard part of your question as being aren’t economic factors just one of a number of values or goals in this process. I think that the point of the economic analysis in the CAP is to make it an intellectually honest document. It doesn’t drive your conclusions. It doesn’t drive what you set as your goals. But it says if we say we want to achieve this, our economic analysis indicates that we have written a plan that will. So specifically it talks about a determination of the economic and fiscal feasibility of the plan with specific analysis of the marketplace factors and incentive and disincentives to the desired development product as well as a cost benefit analysis of public infrastructure investments and projected economic benefits in the City and community. In some ways, when this was written it was envisioned as a sort of public/private partnership redevelopment. Not with the kind of direct investment or powers of eminent domain that redevelopment agencies have but with this notion of putting together a plan which assumed that there was some change in the public infrastructure that needed to be evolved. In this case, of course, one of the big elements is the Homer Pedestrian Undercrossing, and that the CAP would be seen as leading towards certain kinds of redevelopment in the sense of conversion of uses or construction of new buildings or construction of new public improvements. All it actually says is that whatever your plan says it is for, it needs to be for, even after you have done the economic analysis. Chair Burt: Steve, do you think that you will have an opportunity to have a little bit more information on the timing of analysis and availability of firms even if it is not complete information but something more a week from tomorrow? Mr. Emslie: Yes, we do. Chair Burt: Great. Wyrme. Ms. Furth: One other thing that I should say is that because the Worldng Group has been working constantly to arrive at its decisions about the contents of the plan we haven’t tried to edit it to fit the kind of !egal format that We normally use. That is something that we are working on now. That is not intended to make any substantive changes but it will change the layout. Chair Burt: Karen. Commissioner Holman: I have one more question. What happens in the meantime to development out there if we aren’t able to finish next Thursday and forward this on to Council for their deliberations? What happens in the world of SOFA II development in the meantime? Mr. Emslie: The land is SOFA II currently is designated under the Comp Plan for achieving certain goals. There is zoning that currently applies. So there are land use controls that are in place that would govern how projects that were to be submitted to the City however they would be reviewed, what criteria you would use, until that is changed you would use the current land use designations. Page 38 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 46 Ms. Furth: If the Council believes that the existing zoning should not be implemented then if a super majority of the Council believes that they can adopt an interim zoning moratorium on new development. But that requires a super majority of the Council. Commissioner Holman: My concern is that my frustration over the last couple of years while we waited for this plan to be finished is that we did lose some housing opportunities and other opportunities to development that suited the existing zoning. So I am going to be cranky if we end up with more development in SOFA II losing still more opportunities for housing and neighborhood serving commercial and retail because a project satisfies the current zoning and doesn’t have the design standards that theoretically could be approved. So I am just going to forewarn you that I am going to be real cranky about that. Chair Burt: It seems that from the guidance of the City Attorney as well as from what I am sensing of the concurrence of the Commission that we need an economic analysis to fulfill the Ordinance requirements. What we need to do is try and proceed on it as expeditiously as possible and concurrently, at our next meeting, we can address some of the broad policy issues that are not necessarily going to be driven by the economic analysis. We could give our guidance to Council and receive some interim feedback on whether we have concurrence with Council on broad directional issues and also look at whether we agree with the broad vision of the plan. Ms. Furth: Excuse me. I realize another question that Commissioner Holman asked that we didn’t really try to answer was how up to date and how current does an economic analysis need to be. I think you can probably say safely that when the CAP Ordinance was written we did not envision as volatile an economy as we subsequently experienced. We didn’t lcnow we were going to live through another gold rush. So one of the questions is going to be how out of date is the original fiscal analysis. We may have gone back to where it was. The more general answer which is necessarily general is it has to be good enough to satisfy you all. Chair Burt: Phyllis. Commissioner Cassel: Also I suspect that the City Council may or may not want to fund such a project if it is going to be expensive. They may take our recommendations and decide whether or not they want to proceed with or without it. Chair Burt: Although I think they would have difficulty complying with the Ordinance if they did not. There are number of issues that at the next meet that I and probably other Commissioners would like to raise regarding specific aspects of the analysis and what may or may not be appropriate within it. I think we should try to wrap up at this time on this item. Karen, do you have one more comment? Commissioner Holman: Yes, I have one more question for the City Attorney. What would have to happen and how long would it take to make a determination if the existing economic feasibility that was done when this was one joint plan, SOFA II and SOFA I did not exist it was the SOFA Plan, what would have to.happen how long would it take to evaluate if that economic feasibility study would be accurate because the economy has turned? Page 39 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 t6 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 46 Mr. Emslie: That would be the starting place. That is where the consultant would begin to look at the assumptions that were made in that original document. Then they would compare them to current conditions. Then they would begin to focus on the variance between the two. So that in a Iot of ways it would updating that document and they would know fairly quickly where there was going to be discrepancies. There are going to be differences. I think that I wouldn’t feel comfortable saying that there should be any expectation that you are going to go back to the same economic conditions there were five years ago. I think that there it is going to be different. It is predicting the future and it is an art at best. So as far as how long they last it really kind of depends on a lot of external factors that are unpredictable. To give you an anecdotal example, I remember the recession of the early 1990s where I had credentialed economic people tell me that the Bay Area had 15 years of supply of office that would never be absorbed in 20 years. We all saw that that evaporated very quickly. So it is an art and they do have a fairly short half-life. Ms. Furth: .The other thing is that if you look at the original charge from the City Council in 1997, its economic analysis focuses on the feasibility of development to permit sale of the PAMF lands and the attendant public improvements. Of course the big public fund commitments in SOFA which was an entity of the whole at that time are the park, the below market rate housing, the Roth Building. That is where the big capital City investments and the childcare site took place and that is where the Council gave a great deal of thought to the ec6nomic feasibility of that. So a lot of that analysis of SOFA as a whole pertained to those big City capital undertakings. Chair Burt: IfI might suggest for the Commissioners, some of the broad issues that we want to be considering at the next meeting perhaps, and this can be decided whether the Commission concurs, whether there should be one zoning over the entire area or whether there should be a different FAR for the transit oriented corridor. Second, whether PCs should be permitted. Third, if there is a transit corridor should there be a minimum density requirement there. Fourth, what sort of building heights would apply throughout the area. Whether there would be different heights if there were different zoning areas. Fifth, whether there would be different parldng requirements in the transit corridor. Those are some that have come to mind to me and there very well may be other significant considerations for the meeting. If I can ask of the Commissioners for us to real quickly try and wrap up so we can get to the final item. Then we will have plenty of time next meeting. Bonnie. Commissioner Packer: Yes, we may want to add the issue of where and whether to restrict office uses. That was one of the other issues. I was also wondering if also on Thursday we could indicate, maybe this is already assumed by these economic consultants, but some of the things that we want them to be sure to look at like the affect of a small lot versus merged lots and things like this or the effect of whatever our discussion are, ifparldng requirements are reduced how that would effect the economic analysis. We may come up with other questions ,for the consultant that would help the review. Hopefully these kinds of issues m~y help us in the bigger scheme of things when we are looking at the Zoning Ordinance Update. It may be a way to sell the consultants contract. Chair Burt: Phyllis. Page 40 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 Commissioner Cassel: It is an issue that has come up tonight from the Historic Resources Board called the area of potential effect and from the Architectural Review Board related to whether units next door and across the street should be considered for HRB/ARB review. Chair Burt: Steve and then Karen. Mr. Emslie: Perhaps Commissioner Holman was going to mention this but I just want to call attention to the note that Commissioner Holman passed down. That is something that Staff would think would be a big factor in the economic analysis and that is the expanding concept of TDRs. I think that obviously factors into economic analysis. So that would be something that we would want to follow up on. Chair Burt: Great. Karen. Commissioner Holman: Thanks for bearing with me here. It is one other point about what our possibilities are and what our capabilities are. Let’s assume that next week we can’t finish. Everybody wants economic study and we can’t finish, perhaps the City Attorney has to respond to this. Would it be in our purview to forward to the City Council some interim recommendations for the SOFA Area? Is that something that we could do short of a moratorium are there interim recommendations that we could make for the SOFA II Area? That is my question. Ms. Furth: Well, you can make interim recommendations. The question is what would you want done with them? They only have an effect on the property development if they are adopted as zoning by the Council. They can be adopted as an urgency regulation by a super majority or they can be adopted on first and second reading after public hearings in front of the Planning Commission and the City Council. So by the time you got all that done you might be up to September because you would not have held a noticed public hearing on those proposed zone changes. So unless they are done as an urgency matter, which I think requires seven votes of the City Council, they have to come back to you for a noticed public hearing and go all the way through again. That is an interim zoning measure rather’than a moratorium. Commissioner Holman: Yes, and that is what I was taking about. Would that be possible? Would that be something that we could recommend short of a moratorium? Ms. Furth: You certainly have the legal power to make recommendations to them on anything pertaining to the physical development of the City but they won’t have an ability to implement that very quickly unless a super majority wishes to adopt interim zoning regulations. Chair Burt: Okay. So we will continue this item until Thursday, May 16, 2002 at 7:00 PM either in this room depending on availability or the Council Conference Room as the likely alternative. Thank you everyone and we will meet again. Page 41 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Planning and Transportation Commission Verbatim Minutes May 16, 2002 EXCERPT Other Item s: 1. South of Forest Phase II Coordinated Area Plan: Chair Burt: So, this meeting is a continuation of the discussion of the South of Forest Phase II Coordinated Area Plan, and it’s a request by Staff for Planning & Transportation Commission review and comment on the Draft SOFA II plan. Would Staff like to introduce this? Ms. Grote: Thank you very much, Chair Burt and Commissioners. I did just want to draw your attention to items in your packet that you received last week. The DEIR and the Final Environmental Report were included, as well as the first and only addendum to that EIR, as well as the economic analysis that was conducted for the first, what became the first phase, the overall SOFA area. And also, I did include the draft ordinance that the Council ultimately adopted for approval of this Phase I SOFA cap, and that outlined some of the findings that you would need to recommend malting to the Council in order for them to ultimately approve the document. In addition, I did want to update you on a conversation I was able to have with earlier today with Matt Kowta, who wrote the original economic analysis for Bay Area Economics,. and he is available to update that analysis. He believesit would take about four weeks, with a start date of May 24th, which would be a week from tomorrow, and then he could have an initial draft to us by June 24th. He did say that an economic analysis is generally good for about six months, especially in rapidly changing economic situations or conditions. If the economic situation is not changing as rapidly, it could possibly have a longer lifetime than six months, but very rarely does it extend beyond a year. He did say that he felt it is one way to test policies. It shouldn’t be used as a way to determine policy necessarily, but it is a way to test policy. And then given what you learn in that test, you then make tradeoffs as to how long you may want to wait for a market adjustment to take place, or if you want to wait for the market to adjust to different zoning, but he said it really depends on what we would discover during that economic analysis. But he is available to update that original study. With that, I think there was some discussion. Before I close, there was some discussion of a tentative date of May 28th for a possible progress report to the City Council. That date doesn’t look like it can be kept, but we are looking at a June 24th potential for a study session with the City Council, and kind of a joint study sesgion with the Planning &Transportation Commission and City Council to go over at least the preliminary document and some of the larger policy questions and then whatever economic information we do have in draft form on the 24th. So with that, I would close this Staff report, and we’re available for questions. Chair Burt: Great. Any questions? Bonnie? Page 1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27’ 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Commissioner Packer: Regarding the information that Matt Kowta would want in order to frame the model, which he would use for the economic analysis, is that something you would like to seek from us here, or would he just take the draft plan? My question is, the draft plan has certain parameters, and it’s possible we may have some additional parameters. So, I was wondering if we could just say, in addition to the plan, we would like the economist look at X, Y and Z. Ms. Grote: Yes. Yes, you can do that, and what he had indicated he would need are the new prototypes, and Alison Kendall is here tonight, if you’d like to talk in more detail about the prototypes. But we would need to give him the new prototypes. He would also need information about recent projects that have occurred in SOFA II Area. He would probably need some information about SOFA I as well. Also, construction costs, soft costs, things like that, but, yes, if you can make comments on the parameters that are outlined in the plan now, then those can also be factored into the analysis. Ms. Furth: Another point on which you may want to give guidance is while studies are often quite short term, if somebody’s trying to sell an investment, it’s been repeatedly pointed out that this is a longer term document, and so one of the questions is not only what sort of developments and conservation are you expecting to see, but what’s the time frame. I mean, if you wanted a hundred units of housing within 24 months, you’d do something different than if you wanted a certain number of units in the next five to ten years. Timeframes to the extent you have views on those are also relevant. Chair Burt: Michael. Commissioner Griffin: Well, that actually addresses somewhat the point that I wanted to raise, which is, considering the fact that these economic projections are only good for six to twelve months, why bother? Ms. Furth: The short answer is because the Council requires that we do this. The more complicated question is, how do you make it a meaningful exercise? And I think that the more you tell the consultant about what it is you’re trying to achieve, the more he’ll be able to say this is how much we can tell, and beyond that, we can only speculate. Ms. Grote: But I think it goes into helping make recommendations on the tradeoffs that you would want to recommend to the Council. And if you’re willing to wait a longer period of time to get additional housing or if you would rather have perhaps different FARs and get development more quickly, certain types of development more quickly, and whether you want that type of development. Commissioner Griffin: And would he be able to, in fact, deal with this subject of FAR in terms of what kind of, getting back to these pro forma questions that we were dealing with the’ other night, could he address that level of density? Ms. Grote: Yes, he will. In fact, he’ll look at those prototypes and talk about the feasibility or analyze the feasibility of those different prototypes. Page 2 1 Commissioner Griffin: Well, that’s encouraging. 2 3 Ms. Furth: Just to split hairs, of course, density and FAR are different issues. I mean, parking 4 has also come up as a maj or economic factor, perhaps. Any of those things may be things you 5 want looked at. 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 Chair Burt: I don’t know if all the commissioners got a chance to review the previous economic analysis report that was done for Phase I SOFA. It was completed on February 17th, 1998. So, it was really done in ’97, and it reflected data that went backwards in time from there. I hadn’t read it in four plus years, but what it really provided for me was that there were still comparative judgments that carried, that probably will carry forward and we’ll see similar patterns, with different numerical values and maybe some adjustments in the comparative value of different development types. But, when we hear that the economic analysis is only good for six months, does that mean that the actual hard numbers are only reliable for that period, but it doesn’t mean the whole analysis lacks validity beyond that? Is that correct? Ms. Grote: That’s correct. That’s correct. Steve Emslie, Planning Director: Typically, an economic analysis is based on a set of assumptions, and those assumptions may change numerically but the assumptions stay consistent, so it’s a matter of updating those and plugging those in, and that’s one of the reasons why we sought out the original consultant, because it would be quicker to update the assumptions, rather than go back and recreate them. Chair Burr: Karen, and then Bonnie. Commissioner Holman: Yes. Will his analysis consider or show us, in an economic time when things rent for less, how that relates to how land costs might be less, too? So, I mean I think everybody kind of considers that the economic bubble that the dot com period of time reigned in the area really had ballooned rent rates, but in a more normal and more sane economy, will he look at. I’m repeating myself here. Will he look at how those two things relate,, because there’s situations now where people are saying, well, if it doesn’t raise much money, so you have to have more development, blah, blah, blah, so. Ms. Grote: Yes, he will. He will also look at, he mentioned that given a certain zoning and what creates land costs, it’s not always just the zoning, but what else goes into land costs being higher in this city than it may be in other cities, so he’d look at unique characteristics or situations in this city that cause land costs to be what they are. So, he would be factoring in a lot of what you were talking about. Commissioner Holman: And one other piece is, will he also look at or will this be part of his scope? Why there hasn’t been like the encouragements or discouragements of residential housing in SOFA II in the past, because that’s been raised as an issue. Wilt that be a part of his economic purview, economics purview? Page 3 1 2 3 4 5 6 7 8 9 10 11 12 13 .14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 46 Ms. Grote: We can have him look at existing zoning and what’s occurred in the recent past. We can make that part of his scope. Commissioner Holman: Obviously, the reason I’m bringing it up is because previous zoning, or the current zoning actually, has discouraged housing actually, and so I don’t know if it’s appropriate to address that in the economics feasibility study or not. Ms. Grote: We can certainly bring that up to him, up with him, and see if that’s something he can factor into his study. I think there were other elements of the existing zoning that discourage housing, such as the physical development standards themselves. I don’t know how much of that he would be taking into account. Ms. Furth: One interesting thing about the existing previous study is it deals with the Palo Alto micro-economies. You know, how does this area compare with something a few blocks one way or another, so that’s probably interesting in its own right and what are the specific characteristics of the.SOFA area thitt make it more attractive for one kind of business than another, and that kind of detailed information may be very useful to you. Chair Burt: Bonnie. Vice Chair Packer: Yeah. I’m looking at the finding that the City Council meets to make, and it seems to me that’s the reason we would have an economic study at all, because I mean there are a lot of decisions that we make, or City Council makes, without economic studies. I don’t know why they make some of those decisions. Anyway, it says that, this was in your Staff report that came for this meeting and that Finding No. 5, that the City Council has to consider the economic and fiscal feasibility of the SOFA cap in light of market factors and incentives and disincentives to the desired development product, as well as the cost benefit analysis of the public infrastructure investments, etc. So it’s a little broader than a kind of penciling out that a developer would do, like what’s in it for me kind of analysis that we would need. It’s a broader kind of thing, and I would think that if we go ahead with this economic analysis that’s in the context of the findings that we need to recommend on in City Council and not go beyond that, you know, at this point for such a small nine-block area. Ms. Grote: That’s correct. The other thing to keep in mind is that the public improvements in SOFA II will not be equal to what was going on in SOFA I, that we have the Homer Street undercrossing, but we don’t have the park. We don’t have the affordable housing. Those are all done under SOFA I for the entire SOFA area. So, SOFA II won’t have the public improvement package that SOFA I had. Commissioner Packer: So, we don’t have to include that in this finding? Ms. Grote: Well, I think we do, but it will be a much smaller part of the economic analysis. Commissioner Packer: Of course. Ms. Grote: But, yes, it will be in there. Page 4 1 2 3 4 5 ,6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3O 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 46 Commissioner Packer: Right. Chair Burt: Perhaps what we first should do is go through our decision-malting on whether we want to request an economic analysis prior to our formal comments on the plan. At our last meeting, we had talked perspectively about an option of requesting the economic .analysis, and then, at the same time, tonight addressing a number of broad conceptual issues that would be presented to the Council at their study session, and then, after the economic analysis, try to integrate the broad conceptual issues with the additional data and make more specific recommendations. So, maybe we can see if we have a consensus to seek an economic analysis. Any comments on that? Karen. Commissioner Holman: It doesn’t seem as though we have an option not to, since it’s a requirement of the cap, right. Ms. Grote: That’s correct. Yeah. Chair Burr: Any disagreement with that? Good. One decision down. Okay. Yes, Phyllis. Commissioner Cassel: I would just like to make one comment that’s a language issue. As I was reading the documents, I realize that we use Phase I and Phase II in two different ways, and we have to be careful when we listen to it, and sometimes we’re talking about it as a timing phase, what we did the first time and what we’re doing the second time. And sometimes we do it as a geographic phase, and while you think they’re going to be always the same, they aren’t necessarily, so we will do a study. We’ve considered, for instance, whether or not we have library space for the whole of the project in Phase I of the timing. And as we read this, I just want to bring this to peoples’ attention so we are watching, because sometimes that gets me confused, and I suspect it does others. We look at it in both directions and we’re using the same language. Chair Burt: Thank you. And what we may want to do at this time is provide Staff with any additional-recommenda.tions on what we think should be included in the economic analysis beyond what’s been discussed. Commissioner Packer: I think that might come up as we go through the discussion of the specific issues, like density and FARs. And we can say it, as we’re discussing tonight, that’s something that we need more information on in the economic analysis. Chair Burt: Well, why don’t we discuss the economic analysis now and what we can identify as should be included, and then, if there are other things that come up later in the meeting, we can add those to it. Karen. Commissioner Holman: Two things. One, as Lisa pointed out, a lot of the things in this document that you sent forward, which was both the ordinance and the findings that Staff, excuse me, that Council needed to make Phase II, just so when we’re having this discussion we don’t confuse some of the things, there’s some things in here that really aren’t appropriate. Well, Page 5 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 46 there are a lot of mentions of the clinic properties, of course, which should be eliminated, but there’s some things that you have brought forth which is all the infrastructure investments and such that we’re really not applying really as much in Phase II as Phase I, so we should keep that in mind while we’re going through this process, and there are other things such as streamlined city review processes, which was because the clinic was being redeveloped, so there are a lot of things like that I think we need to keep in mind that don’t apply this time. Ms. Furth: With respect to the streamlined review process, that is a goal of cap plans, generally. So, they are supposed to permit a streamlined review plan. That’s one of the goals of the cap under this code. Commissioner Holman: And then the other thing was, when we’re asking for things to be included in the economic analysis, if Staff could help keep us in line so we don’t ask for things that make this a six-month process. If Staff could kind of help keep us on line in that regard, it would be much appreciated, if the other commissioners are in agreement with that. Chair Burr: Kathy. Commissioner Schmidt: And I just wanted to comment for the record that, although I was not at the last Wednesday meeting a week ago when this came up, I reviewed the video. Chair Burr: Yes, Bonnie. Commissioner Packer: I realize that we have to do any disclosures of people that we spoke with, and I don’t think we’ve had an opportunity to do that yet, so before we enter this discussion, I think. Ms. Furth This is a largely legislative. Commissioner Packer: Okay. Ms. Furth: It never hurts to do it, but thi~ is largely a legislative matter. It does have economic findings, but I do think we’re treating thi~ as a legislative matter. Commissioner Packer: Okay. Chair Burt: Great. Earlier, I heard one comment by Commissioner Holman about, if I understood this correctly, the impact of the zoning on the land value, which then would affect the economic computations for subsequent development on that land. Is that an item in your report? Commissioner Holman: Well, actually, I was thinldng about what, if you’re referring to the same thing, it’s what current rents are for various uses and how that impacts land value and how that changes as rent values go up, don’t just the property values go up. And maybe that’s not even a part of an economic analysis. Maybe that’s just a general statement that could be made. That’s where you guys have the expertise. Page 6 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3O 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 46 Ms. Furth: I think one thing to keep in mind is that the economic analysis is going to look at the comparative rents for different uses and for different configurations, so while it’s true that the price that a person’s willing to pay for a lot will go up or down over time, in addition in response to zoning, because of larger economic factors, what it’s really looking at is, given this set of constraints in the existing development that’s there, what, under current circumstances, when would a rational investor think, okay, it makes sense to tear down X and build Y. So, we’ll be looking at the thing you addressed earlier, which was this very high, now burst bubble in office rents, but since they’re looking at what’~ likely to change, when does it make sense to just, as they say, paint up the buildingyou’ve got and keep’ it leased out for the range of uses that we’re going to permit leasing? And when does it make sense to do new capital investment and shift it to another use? That’s going to be principally what it’s looking at. Chair Burt: Bonnie. Commissioner Packer: Yeah. When I looked at the economic analysis. It was done a few years ago, and it seems to me that all those issues, if it’s going to be a unit that’s for sale or a unit for rent, all that gets factored in, and there are tables of the rents for the various types of spaces. All that’s in there. So you’ll have that, and I suspect, because now that the bubble’s burst and what I understand the rents are going down, I suspect he’ll change very few numbers. But, that’s my guess. We can take bets on it, but he may just have to change the date on the economic analysis because we’re backwhere we started, so the only other issue that we may want to raise, if we’re looking for items to go into, what happens if you have, you know, a reasonable size parcel and you can build a 1.0, 1.5 to 2.5 FAR, where in different densities and the impacts of height limits, those kinds of things, on developers’ incentives, and then the other question I would want to know is a little bit more about what kind of density in terms of street traffic, I mean pedestrian traffic, is necessary in order to maintain neighborhood retail or any kind of retail uses. Because in the report there’s a long discussion about, they didn’t there was enough population density to support neighborhoods serving retail. That was a conclusion of the report in ’98. And so the question to ask, well, if density is increased because you’re allowed to build higher density housing, is that going to help that residential retailer [inaudible], so that would be a question that I’d like to see looked into. The nexus between allowing 40 units an acre, let’s say, and the potential of that happening and how that could impact the neighborhood serving retail that people are looking for on Emerson Avenue. Chair Burt: If I might just comment on the retail aspect. That struck my eye also when I reread the report, but the assumption was whether the surrounding neighborhood in itself could support the retail, and we have uses that we would define as neighborhood serving retail, Palo Alto Hardware, Whole Foods, that are thriving in that area and they’re not dependent, even primarily, on the immediately adjacent neighborhood, even though they’re valued by the immediately adjacent neighborhood, and they’re still defined as neighborhood serving. So, that distinction I think is an important one, if we look at economic viability of the retail. I had a couple of others that I want to add to the list. one is the perspective impact of inclusion of TDRs on the viability of projects. Bonnie had already mentioned the comparative viability of Page 7 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 the same density on different parcel sizes or, put differently, what is economically viable on various different parcel sizes? And then, also, it was brought out in the public comments at our last meeting that a lot of what’s economically viable is partially dependent on, essentially, the type of developer. Whether it is a developer who would be building and immediately reselling or a developer who would obtain a parcel and hold that parcel for a long time as an ’investment or perhaps a developer who would already own the parcel and the economics and the feasibility of developing that parcel might be quite different in each of those different circumstances, and I’m not quite sure how that would best be integrated or Whether that is typically done, but it certainly seems to be a reality that is part of what goes on here. Ms. Grote: That is one thing that Matt did mention that would need to be factored in and that he would factor in. Chair Burr: Karen. Commissioner Holman: Parking also. That’s certainly a factor that drives up any kind of use, and I’m interested in some parking comparatives. I was just saying I’m interested in some parking comparatives, because parking drives up the cost of any kind of development. Chair Burt: Any other comments on the economic analysis? Karen, one more. Commissioner Holman: It’s the Pat and Karen show this time..Just to confirm, the study will consider as you’re looking at viabilities of different kinds ofuses, for instance, neighborhoods serving commercial and retail. It Will consider, I would have to think, the development that will be happening in Phase I and the Homer Avenue undercrossing, and all those sorts of things will be taken into consideration. Okay. Thank you. Chair Burt: Bonnie? Commissioner Packer: One of the dominant uses in parts of SOFA II is the auto repair industry~ and there was some discussion during the public hearing about the viability of that industry and its future. So, if there’s any information on that that would give us an idea of whether there’ll be more parcels that may become vacant, or if it’s even feasible from a building code or environmental perspective, to include some aspects of an auto service as a mixed use, and I say this because, some of you know, I live on top of my father’s auto parts store, and we had a machine shop. You know, it happens, so whether that’s feasible at all to provide another opportunity for development. Chair Burt: Well, that brings up an interesting component, and we’ve been talldng about economic analysis of perspective changes, but there’s also perhaps an appropriate analysis of the economic viability of retaining desirable components that exist today, and how viable is that and what sorts of incentives may be needed or disincentives may exist that would influence those decisions? And one that’s specifically mentioned in the plan is to help retain the automotive service sector that’s one of the last in the city. Karen. Page 8 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4o 41 42 43 44. 45 46 Commissioner Holman: You lead me back to the TDRs and looking at those and the economic viability of them, and those would be, I would think, in relation also to what the other zonings are and what else is allowed in terms ofplarmed community, for instance. There has to be a market for TDRs is what I’m saying. ’ Ms. Grote: That’s correct. And also, you mentioned planned community zones and that has an affect. Whether or not planned community zones are allowed in the area will have an affect on the land costs and the land value, and so that would have to be one of the scenarios is, with PCs, without PCs, but, yes, and TDRs would be in there as well. Chair Burt: Okay. If we don’t have any other comments on this aspect, we can go onto some other parts. I think Michael had had one thing he wanted to address a little bit later. IfI might just frame the discussions for the balance of the evening, I was anticipating two major aspects. One is to look at what I’ll, for lack of a better description, call the vision aspects of the plan. Things that do not seem to be in much disagreement between the worldng group and the Staff report and things I’ve heard so far from the Commission, but we should, nevertheless, comment on that and identify any things that we wish to specifically support or recommend modification to. And then second would be a series of the broad policy issues that we would want to consider making recommendations to Council on. Ones that we can address in the absence of the economic analysis and then, after the economic analysis, return to those to make specific recommendations on density and FARs and the other factors that are influenced by the analysis. Bonnie. Commissioner Packer: I think I’m going to find it hard to separate, have a separate discussion on the vision and a discussion on the actual proposals because they have to be inter-related, the implementation, so I would suggest we go right into the nuts and bolts of this thing and test it against the vision. Because we can talk about motherhood and apple pie, but if there aren’t any apple trees, you’re not going to have apple pie, so. I just made that up. Chair Burt: Michael. Commissioner Griffin: Okay, that’s fine, although, in fact, this little three-minute pitch here does fit in with your vision concept. Chair Burt: Why don’t we let Commissioner Griffin share with us some information that he was interested in sharing at the last meeting, and we ran out of time. So, Michael, your stage. Commissioner Griffin: I’d like to briefly put this SOFA discussion into a regional context and you’re going to be interested in the two Visions here. But a regional context, so we can see some big picture planning aspects Qfwhat we’re dealing with tonight. It turns out that the working group has not been the only designers of SOFA II. Two weekends ago, myself and about eight other people from Palo Alto, Yoriko Kishimoto on Council, and we had some people from planning Staff as well, plus some residents, in addition to about 200 more people with strongly held agendas, met in Mountain View at an ABAG workshop. Page 9 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 46 The ABAG people, Association of Bay Area Governments, had a meeting where we planned the growth of Santa Clara County for the next 20 years. ABAG presumes that the Bay Area must be able to accommodate a million people, a million new people coming into the area, and this first map shows how they think that it ought to be handled here in Santa Clara County. This map is an ABAG growth template that we voted to accept. It’s basically a transit-oriented development scheme with the growth impacts directed to the three rail lines. The Cal Train line is the yellow diagonal there from left to right. BART is represented by a couple of beige dots over on the right hand side of San Jose, and the VTAs trolley line.. No bus lines are involved here. This is strictly a rail-oriented development. Now, look at the top of the map, and I’m not sure whether you can see it or not, but in the far left-hand comer, there is an area with blue hash marks, and if you look through the rest of the map, you’ll notice that those blue hash marks are unique to that area up there on the top left, so let’s, Robin, take a look at the next map, please. So, as you guessed, the blue area is Palo Alto, or at least the 75% area of town to the east’of E1 Camino Real, so it was with a great deal of curiosity that we looked at the legend to see what all that meant and the answer, 5% increase in residential growth and 15% increase in employment. Now, I thought we already had a jobs/housing imbalance, but perhaps ABAG knows something about this that we don’t. In any event, you’ll also notice the bull’s eyes there on the Cal Train right-of-way indicating the five target areas for the most intense future development, and, Robin, if we could take a look at the last map? So, finally, we get to Ground Zero, and this is the growth impact zone for downtown, radiating out from the University Avenue train depot. You’ll notice a couple of things. First of all, all of the downtown area shown in red is treated the same by ABAG, all the way from San Francisquito Creek in the north to Embarcadero Road to the south. It’s all classified as medium high-density town center. ABAG defines that as a mixed use area,.with a five-story average building height, with some high rise. They don’t say how much high rise, bm some, surrounded by one to four-story residential buildings. And they gave us a document called a Place Types Manual, which is this, and the definition of medium high-density town center is what Palo Alto is right now. In other Words, the description that they give to the existing University Avenue commercial core, they’re now applying that same town center density to the neighborhoods in downtown north and SOFA II. Second thing is th.at by spreading the University Avenue density toward the north and the south, they’ve more than doubled the size of today’s Palo Alto downtown commercial core district. NOw, whether or not you consider that kind of growth to be smart growth or not, I guess is irrelevant at this stage, but it does put our discussion tonight into a regional context in terms of what at least the ABAG planners, as well as various interest groups that were represented at that meeting, what they would have us build here in Palo Alto, and it gives you a visual concept of what transit-oriented development in North Palo Alto might eventually look like. Getting back to your comment about vision, Pat, I think that the ABAG vision is basically 180 degrees from the relatively low growth vision that we seen in the SOFA II plan, so now you’ve got the rest of the story, and you can see what other people have in mind in terms of vision for SOFA II. Page 10 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 I6 17 18 19 2o 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37. 38 39 40 41 42 43 44 45 46 Chair Burt: Karen. Commissioner Holman: Hearing that, I also feel kind of compelled to say that we do also have a comprehensive plan in place, which doesn’t promote that kind of development’. Commissioner Griffin: I hear you talking, and it was a iittle bit of a mind expanding experience to sit there and see what other people have in mind for Palo ¯Alto. At the moment, as you know, ABAG does not have any direct control over us, but there is legislation floating in Sacramento right now, the idea of which is to combine ABAG with the MTC, and MTC is a state body, and if, in fact, those two organizations do get together, it may, in fact, increase the leverage that the state has on us in this regard. Chair Burt: Bonnie. Commissioner Packer: Thanks, Michael. The reason I said the thing about apple pie is because the vision does talk about, oh, yeah, the vision in the SOFA II plan does talk about that it is near a transit center, and there should be higher density housing because of that, and so it gives a lot of nice language about it being near a transit center. The problem is in the implementation that the densities that are proposed and the height limits that are proposed is a disconnect, because it will not provide the high density that this area should have. Because in Palo Alto, and when you look at the ABAG map, if there’s any place that is a candidate for serious transit-oriented development, it’s this SOFA area. And if we don’t look at it that way, then we’re missing a great opportunity to develop it appropriately, and that I believe is consistent with the comprehensive plan which does talk about creating transit-oriented development that’s realistic. It’s not just adding a few more residences. It’s adding a dense amount of residences, so people will use the transit, because if you don’t have the critical mass of people using the transit, the transit fails. It doesn’t support itself. Commissioner Griffin: I hear you speaking, and I’m drawn to a paragraph here, number C in the SOFA plan on page 2. The last sentence says, most of the uses in the SOFA II area have traditionally supported the uses downtown and the SOFA II area is not expected to co.mpete with the downtown for type or intensity of land use, and my observations were, from the ABAG point of view, they were saying that SOFA II is absolutely the same as the downtown commercial ¯ district. So, that’s why I point out that there is a difference of opinion here as to what the vision is. Chair Burt: Well, I’m not quite sure in terms of whether it’s the same vision in what now has emerged as the vision for SOFA II, which is fundamentally a conversion from a plan and a zone that has historically been predominantly commercial and the original objective was to have a greater emphasis on mixed use and more residential in that mixed use to plan objectives that are clearly favoring residential and looking towards this area as perspectively long-term predominantly residential, albeit at a higher density than other areas that are not in the transit corridor. So, in that sense, even thougfi the density compared to downtown may or may not be comparable, the type of land use being predominantly residential in the long-term would be a different vision if this were adopted. Page 11 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33: 34 35 36 37 38 39 4o 41 42 43 44 45 Commissioner Griffin: I won’t quibble. Chair Burt: One of the things that I saw just on the same overall thematic concept, one of the, most striking things when I was reviewing the economic analysis was that what’s called Block Group 4 in the economic analysis which is Table 3, that the way the analysis was done, there was a Block Group 3 and a Block Group 4, and that was a little bit of an odd analysis method, because Block Group 3 was essentially from Forest to University, which I didn’t think had a great deal of relevance to this, and Block Group 4 was, in essence, from Addison to Forest, with a little bit of zigzagging. And all the way from Middlefield to Alma. And what was very interesting was that the percentage of existing residences were little less than 20% single-family detached homes in that area, 11% single-family attached, 37% multi-family two to four units, 30% multi-family five units, and 1% other. And so the single-family detached homes represent less than 20% of that area. Now, from Addison toward Embarcadero certainly it’s a higher percentage, by far. But that was a very interesting statistic and an eye-opener, and, frankly, in hindsight, it made me reflect on the fact that the original SOFA working group deliberately had a renter representative and, as we all lcnow, it’s difficult to find people who are not home owners who can commit the time and have that interest to commit the time, but really, as we’re trying to have this reflect a multi-stakeholder group, the 80%. We have kind of an 80-20 rule here, the 80% of residents in that area are not part of this process, and it’s a shame that we don’t have more of that representation, and I think it’s incumbent on us to include the concerns and perspectives of that overwhelming majority of the residents in that area. Bonnie. Commissioner Packer: Well, thanks for pointing those statistics out because probably the high percentage of the multi-family units are because they are already existing, and people seem to forget that high FAR apartment buildings all on Forest. And they’re part of our fabric and we’ve learned to live with it and nobody’s complaining, and it’s already dense there, so to resist high density near Alma and to have the low density that’s being proposed in the SOFA plan, I think is low. I think 1.0 is really low for that area, seems to be an anomaly. I mean, we already have good examples of some buildings are nicer than others, but you know, of some high-density buildings, in downtown. Chair Burt: Kathy. Commissioner Schmidt: I just to wanted to support both Bonnie and Pat’s comments that this is really the key, or one of the key places in Palo Alto, to support higher density housing. Close to transportation, close to a transportation hub that we have visions for making terrific improvements to. I mean, what better area could we find to really consider putting higher density housing? So, I think that I definitely want to be !ooking at what higher densities we can make there, and then I think it’s an important point here to consider that this area is already made up of high rental housing area, and it is fine to increase that or certainly continue an emphasis in that area. Page 12 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 Chair Burt: Well, maybe next we can move on to some of these broad policy issue discussions, if that is okay with the Commission. The first question that I had on my list, and please feel free to add to these as we go through, if I omit ones that are important. Yeah, Karen. Commissioner Holman: Actually, I may have misunderstood quite where you’re going, but I think it’s a little bit incumbent on us, too, to look at the vision, because to me, that’s not only the goals and objectives for the plan and see if we have any comments on those, because this was for Phase I and Phase II, and to see if there’s anything that needs to be amended there, but there were goals and objectives for the plan, and then also look at the vision and make any comments on that or not, because, otherwise, we’re really talking ina vacuum. That needs to be our touchstone. Chair Burr: Right. Let’s do that then. Let’s open discussion to the broad vision issue, goals and objectives of the plan, and other things that we might categorize as the broad vision for the area. Commissioners, any comments? Bonnie. Commissioner Packer: Well, you lcnow, if we’re talldng about the vision on page 3, is that what we’re talking about? I don’t have that. I’m just looking what’s in the SOFA plan. If they don’t put it in here. Chair Burt: Well, let me start by taldng what the vision statement is in the Staff report. The vision of the SOFA II area is to preserve and enhance the eclectic nature of the area along with the walkability and livability of the area. In addition, traffic calming and the preservation of local retail and other service uses is strongly supported. The worldng group and Staff are in agreement about this vision for the area. So, that’s the vision statement. Ms. Furth: Excuse me; it probably is preferable to work from the actual document’s vision statement, if you can. Chair Burt: Okay. Ms. Furth: Because we’re going to be responding to your comments in this document. Chair Burt: All right. Start with that as a summary. I’m not going to attempt to read the entire vision statement, but that ldnd of gives a one-paragraph summary that’s in the Staff report, and then on page 3 of the SOFA plan, which is Chapter 2, The Vision Statement. So, having said that, Commissioners, comments on the vision? Commissioner Packer: I think in general it’s great. You know, it’s motherhood and apple pie goes. I mean it’s hard to argue with wanting to have a walkable character and neighborhood serving retail and all the nice things. Preserving the quiet, calm streets. But I also go down to the bottom of the page and it calls for higher density housing, and I think that’s what we want to also focus on. High density housing in the area. You know, it’s more intensive along the Alma Street corridor is what I think is a good part of the vision and I would support that. Page 13 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3o 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 And when we get to the details about development standards, I might have some minor points there, but, sure, the only issue I have is on compatibility with existing buildings could be a problem, because I don’t l~now if we want to have compatibility with the sheds that are used for auto repairservices, for example. I mean we have to have compatibility with something that’s already vibrant and something you want to emulate. It’s nothing wrong with auto repairs, but I mean architecturally, they’re not the epitome of beauty. So, that’s one detail issue, but, in ¯ general, I think the general goals are fine so long as we truly implement the higher residential density along the Alma Street’corridor. Chair Burt: Well, ifI might just comment that the challenge of the plan is to reconcile those different vision goals, not only the higher density and a vibrant mix use area, but with the fundamental aspects of, as the plan states, pedestrian scale urban design, so we’re not talking about high rises here. It needs to remain pedestrian scale, calming of traffic, a variety of household types, and preserving and enhancing the existing streetscape, among other things. So, we’ve got a number of vision concepts that must be reconciled with each other. It’s not an either or situation, in my mind. Bonnie. Commissioner Packer: I want to correct what seems to be an incorrect assumption. Pedestrian scale does not mean everything is the height of the pedestrian..Manhattan is one of the most walkable cities in the world. In fact, it’s absurd not to walk. It’s a wonderful, vibrant place to walk and the buildings are all very high. So, pedestrian scale has to do with the streetscape- feeling warm and inviting because what’s on top of it doesn’t upset the pedestrians. What’s on top of it doesn’t upset the pedestrian scale at all. So, I don’t see that that’s a conflict, and it shouldn’t be considered to be a conflict. Chair Burt: Well, each commissioner is entitled to their opinion on these subjects. I’m not sure that I ~vould necessarily consider some of the local examples of high rises as conducive to pedestrian scale. Kathy. ¯Commissioner Schmidt: I’d support Bonnie’s comments again. That’s I agree with the main analogy to New York, that pedestrian scale to me means that it is vibrant, exciting, fun for the pedestrian to walk along there, and it means what happens at the street level, and, you know, yes, you can have ugly high rises with nothing for the pedestrian at the street scale, but you can have wonderful things happening at the street scale, or at the street level for the pedestrian in any height buildings, and so I would agree with Bonnie that they’re not in conflict by having both density and pedestrian scale to it. Chair Burt: Phyllis. Commissioner Cassel:. And that’s the challenge, of course. And I think it would be wise if we stopped referring to Manhattan, because no one here wants this place to be Manhattan, and I think they’ll probably run us out on a rail and tar and feather us as well if we keep using that analogy. But I agree with the general concept that it doesn’t necessarily mean that it’s people height. Page 14 1 Commissioner Packer: I’m not saying that we should be Manhattanites, not at all. I mean I’m 2 not living there any more.. I like it here, ~but, just as a comparison, in South Palo Alto so the 3 Eichlers that face inward, and these are low-rise buildings, are not pedestrian friendly, so that’s 4 what I say. It’s an issue by itself and it’s not related to the size of the building. 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3O 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 46 Chair Burt: And I guess my clarification would be that it is not wholly dependent upon the size of the building. I might disagree as to whether there’s any relationship to it. Karen. Commissioner Holman: Just for the shock factor for some people, I’m going to agree with that. It doesn’t mean that a tall building can’t have pedestrian scale. It’s all about design. Chair Burt: Okay. Any other comments on these vision ast~ects? So, in general, we consider them to be good and reconcilable? Is that correct? Kathy. Commissioner Schmidt: This can be again interpreted in many ways. And maybe that’s good to give it some flexibility. I see a lot more reference to (it may not be a good thing to say) but to quiet then might be appropriate for that. I understand what’s being aimed for, but vibrant is probably more a vision that I would have for the area; just a comment. Chair Burt: I see vibrant down in the final paragraph. Is there any specific language that seems to emphasize that character that you’re concerned with? Commissioner Schmidt: The quiet part occurs more often and at the beginning, and the vibrant and density parts occur at the end. Chair Burt: So, the vibrancy builds as the vision progresses? Commissioner Schmidt: Maybe that’s the way to look at it. .Chair Burt: Okay. Any other comments? All right. What about general goals and objectives in those kinds of policies, ones that will not be specifically addressed in some of these policy issues that we discussed last time. Anything that anyone wants to comment on? Commissioner Cassel: You mean the Comp Plan goals and polices? Chair Burt: No, where we have policies within the ’SOFA plan. Ms. Grote: Which are not goals and policies. They relate to the Comp Plan, but they’re not the same as the Comp Plan goals and policies..They’re meant to augment them. Chair Burt: Karen. Commissioner Holman: Just one point for Staff or a question for Staff. Is there any point or any advantage to us commenting on the goals and objectives for the plan that Council set forward? I mean, they’ll probably make their own corrections, but should we make any comments on those? Page 15 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Ms. Grote: Yes, I would say that would be very helpful. Commissioner Cassel: I guess I don’t quite know. In this section, it says, Chapter 3 policies. Is ~ that what you’re talking about, and should we be going through those one at a time? Commissioner Holman: This was Attachment C in the May 8 Staff report to us. It included a copy of the Council’s goals and objectives that they set forth on September 22, 1997. Chair Burt: So, that’s what Karen was referring to. Commissioner Cassel: You mean in this document at the beginning? We did several documents that look very similar. ¯ Chair Burt: Yes. Commissioner Holman~. May 8th Attachment C. Chair Burt: Excuse me, please. So, what Karen was referring to is the policy framework that was originally adopted by the Council, Attachment C of the May 8 Staff report. What we previously were discussing was Chapter 3 of the plan, which is a section called Policies. And Karen was asking whether there would be a benefit to initially just review the original policy framework that Council provided and then, as I understand it, to compare that and have that as a context for when we discuss the policies that are now proposed in the plan, is that correct? Commissioner Holman: Yes. If Staff thinks that would be of benefit, and then also, if we recommended that there be any changes to it, because there are a lot of references to PAMF in here. And that’s something I would assume that Council would change, but if you were looking for our comments on it, too, then we should make them. Chair Burr: Wynne. Ms. Furth: I think the Council’s unlikely to, the Counqil doesn’t need to do a new set of principles and policies because this was for SOFA as a whole, and when you split it. When they decided to split it into two phases, even as the EIR was done for the whole area, while some of it’s more applicable than others, other parts of it, they don’t really need to redo it. That’s the kind of analysis that I think the Commission can do, and recommend such changes as you want us to make and we can do those revisions. I think there are two values for the Council in your going over those goals. One is to relate and analyze for them how this plan implements or doesn’t implement those goals, and then, in addition, if you believe that the passage of time or the emergence of new realities makes some of these goals more or less attainable or desirable than they were at that time, I mean, they’re probably interested in hearing from you on that, too. Commissioner Cassel: Yeah, I think that what we have to do is use this as a basis to check back and make sure that we have met these goals when this document is produced and forwarded to Page 16 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 2O 21 22 23 24 25 26 27 28 29 3o 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 46 them, that we, in fact, show a map that designates all land use and consistency. That’s one of the reasons we’re doing the infrastructure plan, and so that each of these goals that they have to meet, and we certainly are capable of saying, oh, yes, that was for the other part, but back to this issue of phasing. In the first phase, a lot of the issues that relate to parks and open spaces were discussed in the EIR and come through and we just have to pick them up and make sure and see how it follows through and that’s up to us to do that. Chair Burt: Well, why don’t we go ahead and proceed on, first, any comments or observations about the original policy framework adopted by the Council on September 22, ’97. This is Attachment C of the May 8 Staff report. So, comments or observations about those goals and objectives? Bonnie. Commissioner Packer: Well, the goals and objectives were fine for the PAMF/SOFA coordinated area plan, and I read them a couple of weeks ago, and it didn’t seem that there was anything in the proposed cap for SOFA II that’s terribly in conflict. It’s just more focused for the nine-block area. So, you know, I don’t know if we gain a lot to go through and wordsmith and compare words if we can just say, well, yeah, walkable neighborhood. That’s covered. That’s kind of reducing traffic impacts with Homer and Channing. Yeah, they covered that. I don’t ¯ think this is a big issue. Chair Burt: Well, if you don’t have specific comments, we’ll let other commissioners’ comment on it. Commissioner Packer: Okay. Chair Burt: Okay..Any observations or comments that commissioners would like to share? There are two that I would just like to point out. One is the automotive service and other service uses that was a specific plan goal, and I think that that has been not specifically been looked at and addressed. We’ve had testimony that, and we certainly can observe, that. Pardon me. I’m sorry. We can certainly observe that we’ve had a great deal of loss of those services since the original policy framework was adopted. And so, this may be something that we want to look at and see whether the plan adequately addresses that issue. And one other point I’d like to make is that when we’ve looked at community facilities, we had some great accomplishments in that area within SOFA I and the primary plan objectives for community services and facilities were achieved there, but I would like us to not completely neglect that concern for the SOFA II area. One of the original concepts was the possible inclusion of pocket parks within SOFA II and other, whether it be pocket parks or other public common open space, and I think it’s a very important new urban concept that goes hand in hand with the densification at the transit corridor that, as a tradeoff to the loss of private open space, there needs to be a recognition and a valuing of public open space, and I’d like to make sure that that remains part of the considerations of the SOFA II plan, as well. Any other comments? Phyllis. Commissioner Cassel: Pat, down here under process for approvals upon plan adoption, one of the things we want to keep in mind as we work along with this. This is on page. Oh, I can’t even Page 17 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 see a page number on this. It says S. Turn over a couple of pages. There’s .a timeline for plan preparation of process for approvals. When we finish with this plan, the presumption is that we will be able, that a developer will l~e able to come in and have their plan processed as a minor architectural review board application, which means that enough detail needs to be in place that they can proceed. And that’s what this plan says the cap should be doing. Now, whether we’ve accomplished that or not, I don’t know, or whether that was the intent of the working group, I don’t know. Chair Burt: I think that’s a very, good point and one that perhaps we should take a moment to discuss. Because that was an original concept of the plan, and it is a question as to whether that is, we consider and the Staff considers that to be an appropriate approach moving forward. I’d welcome Staff comment on whether adoption of this plan would and should result in eliminating further review by HRB, ARB, and the Planning Commission. And, in fact, specifically in the plan, we had some discussions about ARB and HRB roles. Any Staff comments? Ms. Grote: The plan doesn’t anticipate eliminating HRB or ARB review. It does anticipate combining and streamlining those reviews. That is why I think the Joint HRB/ARB was created as part of Phase I. That’s why, for at least some of the sites in Phase II, the worldng group and Staff have recommended continuing that combined board review, so that you would have a streamlined process. Now, there have been various comments from both the HRB and the ARB about that process. The HRB primarily wantir~g to redefine perhaps which sites would go through the Joint ARBiHRB review. The ARB, in fact, making a recommendation that the reviews be split and that non-historic sites go through the ARB and historic sites go through the HRB in Palo Alto, a more traditional review process, rather than the combined process. But the plan itself does anticipate a streamlined review, but not the elimination of any further review. Chair Burr: And the role of the Planning Commission, Would it only exist if there were PC applications? Ms. Grote: That’s correct. PC applications or perhaps amendments. CommissionerCassel: Of course, that’s true now. But the way the plan is written is exactly as you say, but the way this is written indicates that, although we were considering this HRB/ARB review, it indicates that the process would be much more streamlined than this plan seems to say, and that’s one of the factors I think we need to look at. Chair Burt: Right. Although it’s important to remember that SOFA I specifically established an ARBiH joint group. Commissioner Cassel: Well, that’s for a single development process. Chair Burt: Yeah. Steve. Page 18 1 2 3 4 5 6 7 8 9 10. 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 46 Mr. Emslie: Thank ygu. Just to maybe elaborate on Lisa’s comments. I think one thing you need to keep in mind as you consider the process. Really, streamlining works best in a specific planning context, which this is, when you’re giving clear policy guidance in the .design. You’re giving very specific design standards in a form code level of analysis. I don’t think we have that level of detail in this plan, So I think you need to keep that in mind as you consider the process, and really consider retaining the checks and balances that you have in place now, unless you are able to expand upon the design objectives that you have in a very graphic form in this plan. I think you would want to really strongly consider keeping the process as it’s currently configured. Chair Burt: So, perhaps this would be appropriate for the commission to make a recommendation to Council regarding this process issue. Is it most appropriate in the form of a motion or would it be more appropriate for commission comments? Ms. Furth: You could do a consensus statement, if it’s a consensus of the Planning Commission, and that can be recorded in your Minutes. Commissioner Cassel: But I’d like to do it at the end, when we’ve gone through this and see what we have here. Ms. Furth: So, somebody keep a list. Chair Burt: All right. So, we’ll at that request, we’ll review that at the end of the discussion. So, any other comments regarding the over-riding policy framework that was originally provided by the Council? All right. Then, we can perhaps proceed to Chapter 3 of the plan itself and the policies. There are going to be within this the substantive policy discussions. We could do it two ways. Just sequentially as we go through the plan, hit those, but in a way, they pop up several different places. What I could do right now is review some of the items that we had discussed at our last meeting as perspective substantive policy discussion issues and see if that list seems to cover the-issues that the Commission would liketo discuss. Does that seem fine? Okay. One has to do with whether there should be a single zoning and FAR throughout the plan area or whether there should be two zones, one more immediately adjacent to the transit hub and another for the balance of the area. The second would be whether PCs should exist in the plan area. If so, should they exist in the entire plan, be allowed in the entire plan, or should they only exist if there are in one of the zoning density areas. Second, regarding PCs, whether there should be any limit on the maximum FAR that would be allowed under a PC. Next item. Should there be minimum density? If there is a separate zone, should there be a minimum density either there, or should there be a minimum density throughout the plan? Next, whether, what sorts of height limits? Should there be one height limit throughout the area, or should there be two height limits? Page 19 1 2 3 4 5 6 7. 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3o 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 46 Next, parking issues. First, what should there be? Should the entire plan area follow the general city guidelines on parking densities or should there be a different parking density requirement either for the entire plan or for this perspective different higher density zoning in the area most adjacent to the transit center? Next, whether lot combining should be allowed and what sorts of encouragement or discouragement should occur for lot combining? Next, whether office use should be restricted and if so, how? And then, this other issue that ties in to what we were talking about just a moment ago, which is what sort of historic review should occur? We had a couple of different alternatives, one in the report, one by ARB, one by HRB, as to whether only the historic building itself should be reviewed, whether adjacent buildings should be reviewed by HRB or whether affected buildings should be reviewed by HRB? Any other major items that other commissioners would like to add to that list? Phyllis. Commissioner Cassel: Well, we need to review again because it’s an issue that didn’t get resolved or is scheduled to be resolved later, but just review the two-way street issue for Channing and Homer. Chair Burt: So we could put that under the entire traffic flow issue, okay? Anything else? Karen. Commissioner Holman: I think there’s more than just, it came up, whether there was, what properties would be reviewed by the HRB or ARBiHRB, and there’s also the issue of that program. Chair Burt: I’m sorry. What do you mean by that program? Commissioner Holman: Well, there were some members of the ARB who wanted that program, were questioning the value of that program. So, was that something you wanted us to discuss? Ms. Grote: Or thatprocess I thinkis what they were questioning. Whether or not we should continue with a joint HRB/ARB board is how the ARB had approached it. They were not recommending that we continue with that process. Commissioner Holman: And then also, would you consider TDRs as a separate thing that we would need to address here, ! would think. Ms. Grote: Yes, the TDR policy and program that goes along with those. Chair Burt: Good additions. Bonnie. Commissioner Packer: And the last, and probably should be the last, is the relationship or the design guidelines to the development standards and vice versa. Chair Burt: Okay. Great. We’ve got a good list. What about the sequence? There’s a few things that were just added that maybe should more appropriately be included in the earlier Page 20 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 grouping, but shall we proceed first into the broad issue of whether there should be a single zoning for the entire district. Yes, Wyrme. Ms. Furth: There is an issue that’s phrased that way in the plan, but I do want to say again that as the plan is presently before you, whether it’s the working group recommendations or the Staff recommendations, it’s not a single zone plan. In addition to the fact that there’s an area, which is, zoned R2, when you read through the zoning standards, they apply differently in different sections, and those are different zones conceptually. Those, if you say, office except over here, those are different zones, when you’re thinking about how many different ways are we categorizing property in terms of what you can do at it, so I thinkthe discussion will be easier for us to follow, if you keep those different segments in mind, and there’s a lot of overlap and it’s not yet clear to me, and maybe not to you either, as to what’s the best way to lay that out so that people trying to figure out what can happen where have an easy way of telling you without getting endless alphabet soup, but all the proposals before you have multiple land use classifications. Chair Burt: Point well taken. So, it’s a more complex discussion than I was characterizing it. Karen. Commissioner Holman: If I could suggest, I think there might be some things that we could accomplish that are maybe not is complicated and interlaced with other things perhaps as the zoning. For instance, we could look at review processes. We could look at lot combining. We could look at some of those things and get those accomplished and done, rather than doing this one first. That would be a suggestion of mine because this one entails so many things. We could spend the whole night talking about ’it, which it merits, but not accomplish anything else. Chair Burt: Bonnie. CommissionerPacker: I know, it’s the essential issue is for us to figure out if we’re going to have two areas in which different development standards like FARs and heights may apply. It’s very hard to talk, and otherwise, we’d be talking in a vacuum, because the Staff proposed in the plan two different area~, which I was never really clear what the boundaries were? That’s what I was going to ask. You know the areas closer to Alma and the areas that are not closer to Alma. And I think if we can understand what those are, even if we don’t have the exact boundaries, if we can decide that it’s reasonable to make a distinction between the higher density areas that Staff was proposing, then I think it would help our discussion about all those other items, because you were framing it that way. If we wait, then we’ll get to this very important thing too late in the evening. Chair Burr: Yeah, I’d certainly prefer to tackle the big important issues, but would Staff like to briefly summarize how the working group and how the Staffhave addressed this issue? Ms. Grote: And the issue primarily being the density, the FAR and the heights, at this point. There were two maps attached to your May8th Staff report, just for reference. And they’re also hanging on the wall, I believe. Yeah, they are. Attachments E and F, and Attachment E goes over the working group alternative, which calls for a 1.15 FAR over the entire area, that’s not R2. Page 21 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 over the rest of the area, with a height limit of up to 50 feet for a section of Alma Street, and that is shown in a hatched marked area along Alma. It start north of Addison two lots in from Addison on Alma. It goes across Channing and then it stops at the one lot in from Homer. So, it approximately one, two, three, about four to five lots along Alma and then on the far side or the north side of Homer, it starts one lot north of the Homer/Alma intersection and then goes to Forest. And that’s called a residential transition at 50 feet. So that’s essentially where the higher buildings would be allowed. Now, for the Staff alternative, along with those higher heights would come a slightly increased floor area ratio. Yes, Karen. Commissioner Holman: I just wanted to let you know that Alison’s putting this up here so it might be easier to explain and for people to follow, and that was happening behind you. Ms. Grote: Okay. Thank you. Thanks. Maybe I should stand up. If it’s the darker area along Alma Street that would be allowed to go up to 50 feet. And, again, it drops down at Homer to 35, to keep the Homer Street corridor at a consistent 35 foot height limit. Commissioner Cassel: I’m hate to have you do this, but try it over again, because I’m not finding this very easy to understand, this map. It’s a black and white shaded map. Ms. Grote: The higl~er heights up to 50 feet would start where Alison is pointing out at Forest, on the north side of Forest and then extend down to just one-lot in from Homer where it drops down to 35 feet for that lot on that side of the street. Also 35 feet on the other side of the street. That keeps the Homer corridor at a consistent 35 foot height limit. Then it goes up to 50 feet again until about mid-block Alma between Channing and Addison, and then it drops down to 35 feet at that point in order to transition into some of the lower density residential areas on the other side of Addison, on the south side of Addison. That was the thinking for the working group to have that kind of transition into the residential area. The Staff has a variation on that, which shows a residential transition along, again, Alma starting where Alison is pointing out, going again to Homer, dropping down to 35 feet there as well on both sides of Homer, and then going up to 50 feet for the full length of Alma to Addison, and then on the other side of Addison dropping down to 35 feet for that transition into the single- family neighborhood. In addition to going to 50 feet in height, it would have a higher FAR as well, up to 1.5, and that would be with a planned community zone change and it would be with specific public benefits, including things like child care, public services, public open space, public parking, other public services or facilities within the SOFA II area. So those were the basic differences in height. Bonnie. Commissioner Packer: How high is the complex in which Bob and Bob, you know, across the street on Forest? Is that 35 feet or 50 feet? You know, the one that has the little odd shapes. It’s not within SOFA. I just want to get a sense of the surrounding neighborhood and how the heights are. Does anybody know that offhand? Ms. Grote: I don’t. I would have to look at plans. I don’t know how tall that is. Page 22 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Chair Burt: I’m pretty sure that’s above a 35 feet height. It’s multi-story. Five stories? Yeah. In fact, I don’t know whether anybody has it with them, but one of the original SOFA I maps had the building heights of existing properties throughout the SOFA plan. I don’t know if it included the adjacent ones. Commissioner Packer: That would be an interesting document to have. The properties all around downtown that are already high. You know how they had a big map in the Hyatt EIR, which showed all the different sizes of the buildings around to give a feeling for what was happening. That would really be helpful for people to see what’s possible and what exists. Ms. Grote: We can make it available for you. We do have the existing conditions information, so we can make that, not this evening but at a future date. Chair Burr: And, Lisa, would you like to characterize the balance of the plan area? Ms. Grote: Okay, back to the working group concept, it would then be 35 feet in terms of height and FAR would be 35 feet for the remainder of the area with a 1.15 maximum for area ratio. There would be no new ground floor office along Homer and Emerson. Existing ground floor office could remain. If there were an existing retail, personal service, or other type of neighborhood service use, it could not convert to office, but an existing office could remain. There would also be a 2500 square foot limitation on ground floor offices anywhere in the area, up to 5,000 square feet for any given parcel. In addition, anywhere south of Homer, there would be no new business office. You could still have a new medical or professional office, but not a new business office, and those are defined specifically in the zoning ordinance and in the cap. Yes. Commissioner Holman: Just for clarification. So any kind of neighborhood serving commercial, that sort of thing, is allowed. Ms. Grote: Yes. Yes. It would be south of Homer and elsewhere in the area, yes. So, for the Staff alternative, again, there is a 35 foot height limit for the remainder of the area and it-would include the same office restrictions along Homer and Emerson. However, the office restriction along, or I’m sorry, south of Homer would not be the same as the working group. In other words, you could have a business office, a professional office or a medical/dental office, so there wouldn’t be that business office limitation south of Homer. In addition, and this is not shown on these particular plans, but is written in the development standards themselves, the parking requirements are different. The parking requirements for the working group alternative are those that are found in Section 1883 of the zoning ordinance currently and that is any residentiM unit with two bedrooms or more has two parking spaces required for each of those units, plus a guest parking requirement. Then also there are parking requirements for retail uses. One space for every 200 square feet of retail and then there are parking requirements for office, and I believe that’s one for every 250 square feet of office. Whereas, in the Staff alternative, those parking ratios .are reduced, I’m going to need to read these out of the code, but for a residential use, there would be 1.5 space per unit requirement, and that Page 23 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 would be in conjunction with types of transportation demand management programs, such as car sharing, transit passes provided, other types of incentives for reducing the number of cars you. might have. Also, for non-residential uses, for office and commercial uses, it would be one space for every 350 square feet of floor area, which could again be reduced by another 5% if there is a TDM program in place. And then for retail, it would be one space for every 250 square feet, except that the first 1,000 square feet of ground floor retail would be exempt from any parking. So, that is again to encourage combining trips, encourage use of the transit station and other modes of transportation, so I think that summarizes the basic. Chair Burr: Lisa, we also have this perimeter of R2, kind of a buffer zone that is on Ramona, circling around to Addison? Is that correct? Ms. Grote: That’s right, and that would remain in place without changes. Chair Burt: So that’s designed as a transition to the neighborhood? Ms. Grote: Yes. That is correct. Chair Burt: Great. And on the parking issue, ifI might ask, we don’t have many examples in the downtown area of fully parked buildings that have been constructed in recent years. We have the SRO, and then I think this building right over here on Hamilton. Is it the Coldwell Banker building? I’m trying to recall. But my question has to do with when we’ve had fully parked buildings, what sort of utilization of parking have we seen? Do we have that kind of information? Ms. Grote: We haven’t done parking surveys to determine whether or not fully parked buildings are using their parking all of the time. I don’t know. We have not done those surveys. Chair Burt: Okay. Thanks. Other questions? Kathy. Commissioner Schmidt: Yeah. On both plans, this is noted that essentially next to Alma Street, it’s recommended 50 foot heights. But it also shows an overlay dotted line of sites with redevelopment potential and, essentially; along Alma Street, there’s only one site that’s got redevelopment potential, so am I missing something? Sort of like, what good does it do to say, yes, let’s have higher density there if there were greater heights if it’s not going to get redeveloped? Or is not likely to get redeveloped? Ms. Grote: I think that redevelopment potential was more immediate redevelopment potential. ¯ Ultimately, the sites do have redevelopment potential, but it’s in the longer term. Those that are in the dashed areas are more immediate than some of the others. So, in essence, a lot of this wouldn’t redevelop immediately, but it will over the length or the life of the plan, which might be another 15 years. Chair Burt: Karen. Page 24 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Commissioner Holman: Could Staff update everybody because I’ve been hearing of late that there’s another parcel that could be added to that where the transformers are now. Is that rumor? Mr. Emslie: It’s not rumor. It has to do with the Utilities Department and the recent conversion over to.a different electrical delivery system, which has eliminated the need for as many substations as the city currently operates. Given the current system, we have probably five times as many substations as necessary. Because this one clearly has a redundancy with the existing substation on Corey Road near the Stanford Mall, there is consideration that the Utilities Department is giving to recreating that in that facility and making this site available for redevelopment. Chair Burt: Bonnie. Commissioner Packer: I have a quick question. On page 31 of the plan, it talks about floor area ratio, the blue part. It says that on exclusively residential, it’s 1.15, but it says, except along Homer and Emerson. Can you elaborate on that parenthetical? Is there something or was that parenthetical, is it a typo? Ms. Grote: I believe that was to encourage ground floor retail uses or personal service and other commercial service uses on the ground floor, so that you would, in fact, have a mixed use project along Homer or Emerson that then would mean the full FAR wouldn’t be in residential use. Chair Burt: Okay. Why don’t we open it up to the Commission for discussion of the concept of whether there should be a different and perspectively higher density along a corridor that’s most immediately adjacent to the transit area and further discussion could be, if so, what sort of boundaries do we think are appropriate? Bonnie, and then Karen. Commissioner Packer: Well, I think the boundaries for the higher density and the higher heights can certainly be larger than either. The Staff recommendation certainly is larger than the working group recommendation. I don’t see why we couldn’t have the higher density and higher height along High~ Street as well, except towards the south near Addison, because certainly you wouldn’t want it near the residences on that end. But there are no residences in that area, and certainly you want to protect the historical sites, etc., but, on the areas that potential for development, I don’t see any reason why we couldn’t have the higher density and the higher height, with appropriate design guidelines, for all the reasons that Michael mentioned before, and I mention that this is a transit-oriented area and it should be developed for residence, for mall mixed use. You know, I would propose something like a .4 for ¯ commercial and the rest residence. And with our criteria that you would have higher density for projects that had 25% BMR, for example, and other amenities that you set out. In fact, I was going to propose a transit-oriented development area, which would allow a 50 foot height, higher FAR, maybe 2.5 or 3. A high density 40 units per acre, provided that there was a 25% BMR, and what else? And that there was lower parking requirements. One parking stall per unit, for example. But to take into consideration existing items that we have in our zoning Page 25 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 46 code when a project is near residences, that 150 foot guideline which calls for 35 feet in daylight planes when you’re within 150 feet of residences. And that’s what I would propose. I think this is a great opportunity to create a defined TOD area. Chair Burt: IfI might see what our opinion is on what we should do tonight, one of the discussions we had talked about within the context of the need for the economic analysis would be to restrain ourselves from making specific FAR proposals until we see that analysis and then come back and revisit specific proposals after we have that additional necessary information, rather than try to zero on FARs tonight. But that’s open to the Commission as to how specifically we would like to go. Before we proceed, is there a consensus on whether we should attempt to make specific FAR type proposals tonight or we should talk conceptually on these issues? Any thoughts on just that subject for the moment, and then I’ll retum to Karen. Karen. Commissioner Holman: I think conceptually is better. Then when we have the information, then we can make better determinations. Chair Burt: Phyllis. Commissioner Cassel: I prefer doing it the conceptual Way. I had a comment, however, on this subject. Do you want to wait? Chair Burr: I’l! return to that in just a moment. Kathy. Commissioner Schmidt: I would say conceptually also. I mean as we talk about making things more dense, like I agree with the kinds of things that Bonnie is talking about, but I don’t think we’re going to come up with the exact densities of anything tonight. Chair Burt: I see Michael nodding his head as well. Okay. Phyllis. Commissioner Cassel: In terms of increased density, it doesn’t make any sense to go to a 50-foot height limit rather than a 35-foot height limit and keep it at the same FAR. All that does is give you a tall building.. It does give you a tall building and more open space, but what’s the point? Otherwise, you might as well just leave it at 35 feet. Chair Burt: Karen. Commissioner Holman: Yeah. One thing that I’d like for us to consider is if we’re looking at higher densities, whether it’s along Alma or wherever it is, how do we get there and for what purposes? For instance, do you get there because you zone it taller and more dense and a higher FAR? Or do you get there because you have a TDR program, (just so we don’t talk like in a vacuum here) or do you get there because you have PCs that a Staff has recommended that or allowed for very specific public benefits, so I’d like for us to keep those things in mind so we don’t just say, blanket, you know, 70 feet tall, and you know what I’m saying. Chair Burt: Right. So, first, we certainly have the city-wide 50 foot height limit that presents a cap, but what I understand you to be asking is the question of whatever density ends up being Page 26 1 adopted, would it be ban entitlement or would it be under certain conditions that it would be 2 allowed, and maybe we can hit that even more as we go into this PC question, but that’s where I 3 was thinking that even within the PC question, your issue on TDRs may get intertwined. 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3O 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 46 So why don’t we, before we take a break, see if we can arrive at any consensus on the basic concept of are we in favor of greater density in the, shall we say the core area, and, if so, the core area most adjacent to the transit hub, and, if so, what boundaries do we think are most appropriate for that core area? Kathy. Commissioner Schmidt: I’ll say that, yes, I’m in favor of higher densities in the core area, that being near Alma Street, and I would tend to go with Bonnie’s suggestions about taking it the whole block into High because we might get some development done that I think a lot of the things along Alma will not change for a while or have been updated already, and we won’t get anything out of this, unless we look a little deeper into this. Chair Burt: And I might add another sub-issue to this. If we support a higher density, should there be articulation at the street face to have the less appearance of a 50 foot height limit right at the street face or should we not? Kathy. Commissioner Schmidt: I was going to say, I think, can we talk about. That’s getting into, you know, the form here. I mean, I don’t think we can get too detailed. I think, you know, the rate we’re going, we’ll be talking about this for three more weeks here. Chair Burt: Okay. Commissioner Schmidt: If we want to cover a!l these topics, so I think we should be talking about some general concepts tonight and not get into a lot of detail. Chair Burt: Okay. Ms. Grote: And ifI could, just for clarification. When you’re speaking of the core area, I’m assuming you mean High and Alma from probably Forest and that one block north of Forest all the way down to Addison? Is that what-you’re referring to as a core area? So, it would be two lots deep, fronting on High and fronting on Alma? Chair Burt: I would concur with that, with the exception that I think that I would support a mid- block transition in the block between Channing and Addison, so that there is a transitional zone to the lower densities of the outlying areas. Is that boundary approximation seem to be. I’m seeing heads nodding. Michael. Phyllis. Phyllis, Kathy, Bonnie? Karen. Commissioner Holman: I’m more along the lines of the, actually, because there’s not even very much difference between the Staff and the working group recommendation for this, and for the height limits which is what we’re talking right now, and to keep in mind that there’s a difference between height limit and density. Everything is on balance, and one tenet is thi~t you don’t change heights in the middle of the street, and so that’s something that I’m considering, so that would tell me not to do 50feet all the way down to Addison on High Street, and the other thing Page 27 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 that that does is, well, all the way down to Addison,too, I think there’s a residential, single-story residential on Addison south of High Street as well. So, I’m falling somewhere with the working group end, Staff recommendation for the 50 foot height. Chair Burt: Okay. Bonnie, do you have something else? .Commissioner Packer: No, I was just going to concur. Pat’s drawn a little picture. Maybe we should see if the rest of the commissioners agree with the boundaries. Chair Burt: Yeah. If I might describe it. Consistent with the comp plan and what Karen had been talking about, emphasizing m. id-block transitions in density and height, rather than at the street face, to have this core zone go from Alma to the middle of the High Street block. The middle of the block separating High and Emerson. And then extending from Forest down to the middle of the block or maybe there’s some other tweaking of the boundaries, but the middle of the block between Channing and Addison. Yes, and then what Alison is drawing in also is the concept of retaining the Homer corridor at a 35 foot height limit. Is that also something that the Commission thinks is appropriate? Commissioner Packer: I don’t know if we need it. I’m not sure about that, when it’s near Alma Street. Or is that already developed at those low levels? Chair Burt: It is not developed above those levels at Alma. Karen. Commissioner Holman: I was just going to say, to do what’s drawn here will, I mean, I don’t have a magic wand here, but I think to do this is going to absolutely eliminate and defeat some of the other goals of the working group (not the working group) but the Council objectives, and that’s to retain the mixed use fabric and to build on existing character, and you’re going to lose any of the smaller retailers that are there. You’re going to lose them. You’re going to lose. You’re going to lose Reach. You’re going to lose Watercourse Way. You’re going to lose all the automotive. All things are on balance, and we have to consider what else we’re trying to accomplish here, as well as density. And density doesn’t always relate to height, by the way, of course. Chair Burt: Well, I think that brings up an important issue that maybe we can tackle after break is reconciling this concept with some other of the planned values and objectives. So, if that’s all right, we’ll take our ten-minute break now, and come back and tackle meaty issues. Chair Burt: One of the things that we might want to look at is considering that last night we had a meeting from 6:30 until 11:30 and I think both the Commission and Staff are somewhat exhausted from that, and the appearance that we will not be able to really give our discussion of the plan full justice tonight, maybe we should consider attempting to adjourn the meeting no later than a quarter to ten. How would the Commission feel about that? And then have a follow-up meeting at which Staff is looking for opportune dates, and we have this opportunity now, since the Council meeting has been pushed out from their May 28th date into June. So, while Staff is looking at what dates are possible, what do you guys think about cutting it off at around that timeframe? Page 28 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Commissioner Holman: No later than 10:00. Commissioner Cassel: I think that would be excellent. Chair Burt: Okay. We may not have a quorum, but, okay. Let’s pick up where we left offthen of Commissioner Holman was raising. Oh, Kathy? [pause] Yes. She was raising a substantive question of the need to reconcile some of the discussions we were having aboutheight and density in this core area with some of the other plan objectives and how those things can be reconciled or may not be able to be reconciled. So, I would welcome discussion on that concept, as well. We seem to have preliminary consensus of most of the Commission supporting the concept of that greater core area, but let’s move into a discussion of reconciling that concept with other planned objectives and values. Commissioner Cassel: You know, as we are talking about this, I just would love to have more housing, but I think there’s other ways of getting housing than to go. I don’t really want to go into the 50 feet on the other side of High, and I’m still feeling my way about doing it on both sides, because of this transition issue. So that we don’t all have a sense that we’ve got a very strong feeling one way or the other on this, I’m really feeling my way. A lot of work was done by the working group, and while I don’t agree with everything, I would like to preserve a good deal of it and see how it goes. Chair Burt: Well, if I might add, that concept that you were talking about on the height on the street is why earlier I was raising this issue about perspectively having setbacks, and this was something that the working group at different times had had considerable discussion, and we don’t have to resolve it tonight, but that’s one way that we may reconcile a height limit on the property and, ultimately, some of the design features that may transition this sense of scale. Commissioner Cassel: And as we have some height along Alma, we also gain some real density in there, we actually provide a buffer from all of that noise into the living area. Chair Burr: Bonnie. Commissioner Packer: Yeah. I’d like to attempt to address some of the philosophical questions that Karen raised, and I’m not. I just want to say, it’s not so much the height that I would advocate. It’s just trying to find a way, whether it’s through density or whatever, or, I mean, through FAR or whatever it takes to get a little bit more density, maximum unit size, whatever, lowering the parking requirement, various things that we can do but within the area that was defined is what I’m talking about. But to go back to Karen’s comment about, well, if we do this, are we going to lose some of the existing businesses? Is it going to detract from the scale and the walkability and the pedestrian feel, all those nice things that are there now, and my answer is, is that because we’re dealing with just really, in reality, a few parcels that would potentially take advantage of any of this increased opportunities that a SOFA cap with these new densities would provide, I don’t think it’s going to happen that you’re going to have, a big mass of things going in and it’s only going to happen if Page 29 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 1 it’s economically feasible. We’ll find that out from the economic analysis. Whether Reach 2 would sell out in order to take advantage of new zoning or not, I don’t know if that’s going to 3 happen. But so much of the rest of the area would not have these densities and you’d have that 4 area along Homer and Emerson, and we’d certainly want to have design guidelines and ways to reduce any impact of massing that would happen with a greater FAR or a greater height, " whatever it is. So, I think it’s doable. I don’t think we should be afraid of well-managed change. Chair Burt: If I might add one other potential mechanism to reconcile some of these issues is that, if there is a greater density allowed in certain core areas, if parking is mandated to be undergrounded in conjunction with that density, then the scale of the building is not necessarily increased, and so that may be something we want to consider. Karen. Commissioner Holman: Yeah, just to look at the map along High Street, there are a lot of properties actually with development potential on them that are identified, so it wouldn’t just be one or two parcels, and getting more density. You know, we’ve talked about the Palo Alto . Housing Corp Project in SOFA I, and how it’s really very compatible with the neighborhood, and it has a very high density. And so I’m just trying to balance these things and also be respectful of the work that’s been.done Previous to this, Pat and I both having been a part of that since the very beginning. But just not wanting us to be so very, very married to height, because density is not always married to that, so that’s where I’m headed, and I’m looking more interested in parking requirement reductions, one of which, just briefly, I’ll mention right now, which is the Staff recommends 1.5 units,~excuse me 1.5 spaces per unit,’and I’m wondering why, for studio units, you’d have 1.5 spaces. Ms. Grote: It’s actually one space for a studio, but then 1.5 for other one-bedroom and two- bedroom units. Commissioner Packer: Well, I think that’s the existing requirement is one for studio, and I don’t believe it’s reflected in the development standards that we saw, that’s recommended. Ms. Grote: It does need to be clarified.. It is currently one for a studio. Yeah, for a studio, it’s one space per unit, and then for one bedroom, it’s 1.5, and then, yeah, two bedrooms, it’s two, and more than two bedrooms, it’s two spaces. So, I can clarify that in the parking section. Commissioner Packer: Thank you. Chair Burt: Michael. Commissioner Griffin: Are we ready to wrap up this portion here having to do with the perimeter of our higher height zone? Chair Burt: Yeah. Maybe we could do that with an acknowledgement that after we’ve gone through the other issues tonight and at a subsequent meeting, we may find it appropriate to do a final revisit on that and see whether we still feel the same way about the boundaries. Wyrme? Page 30 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3o 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 46 Ms. Furth: We wanted to reiterate one other thing, whichis that you’re used to looking at. We ¯ all are used to looking at zoning standards that are going to apply in a whole range of places. This is not that. This is the reverse.- This is a set of standards for this exact part of the city, and that means that you don’t have to think in terms of a standard that applies to an entire lot. So, you don’t have to set height limits at one side of a lot of another. If you believe that there is a distinctive feature in this area that needs to be treated in a distinctive way, that’s what form codes do. They’re seen sometimes as being very prescriptive about what a property owner can do and reducing flexibility, but, in some ways they can also increase it because you can vary the standard across a lot, so that,, for example, if you think that a higher structure might be suitable if it leaves enough view corridors or has enough set backs so you don’t shade the street excessively, or loom over people or whatever, you can deliver those kinds of instructions in pretty specific terms in a situation like this. Chair Burt: Okay. If we’ve aired that one for tonight, do we have a preliminary consensus on a core zone approximately along the boundaries that Alison has drawn? Commissioner Cassel: I’m not sure that I agree with going quite that far, but I’m interested in looking at it in the future. I think where we do have a consensus is, I get a sense that we have consensus that this should have a different height along here, and I guess we haven’t discussed density then. Chair Burr: Right, and we may want to separate the conceptual issue of whether there’s a core area that should have perspectively different densities and heights as opposed to determining what those should be. Karen, did you have something? Commissioner Holman: Well, since you asked. I was thinking that one thing that we might be able to state is whether we build on it or not is another issue, but do we agree with either the working group recommendation or the Staff recommendation. Maybe that’s even not a statement we should make tonight, but we may or may not want to build on that as far as the heights along Alma or along Alma and High Street, so what I’m saying is, maybe we could agree on one or the other of those options, and then we could agree that we will or won’t add onto that later, but at least get the base thing accomplished. Chair Burt: I think that Karen is asking whether we would like to lend support to either the working group densities. Commissioner Holman: I’m sorry. We’ve been talking about height a lot, so I was thinking that something we could tick off is in looking at the working group map and in looking at the Staff map regarding heights along Alma and High Street, would it be helpful if this group agreed with one or the other of those, and then also kept it open that we might add to that area of 50 foot heights in the future. Chair Burt: The sense I got from Phyllis earlier, which I think I would concur with, is I’d prefer to defer that discussion to a subsequent meeting, so that we have a little better chance to digest the other aspects that we’re discussing and then revisit that aspect. What does the rest of the Commission think? Bonnie? Page 31 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 46 Commissioner Schmidt: I think we’re confused here. Chair Burt: Okay. Commissioner Schmidt: It sounds like we’re saying that, yes, we support higher density and probably higher height in a band along Alma and we’re not quite sure how deep it goes, and maybe many of us think it would go at least to High Street and possibly be part-way into the block, and we don’t know how far we want it to go, but we’d certainly want it at least along the face of Alma and probably at least along the first whole block, and can we just leave it in a broad concept like that? Chair Burt: I’m comfortable with doing that at this time, and revisiting the refinement of the issues at either our next meeting or after the economic analysis report. Bonnie. Commissioner Packer: Alison’s drawings and prototypes there gave me some feeling for the relationship between the FAR and the height and what densities you can achieve, and I think it’s really hard for us to talk about each of these things separately, and I don’t think we should be doing it, and that’s what’s getting us confused and all tied up into knots. Is there some way, is there some kind of like a spreadsheet? There are a lot of 50x100 foot lots and then there’s some larger ones, and one the various lot sizes, if let’s say you had 1.5 and 35 foot limit and you were allowed 40. What’s the maximum density of reasonable living size units can you get on these things, and is there a little spreadsheet where we could see, oh, well, if we did this, we would get X amount of units for the area that we’re talking about. I think that would give us a sense of what we would eventually accomplish. I know it’s made complex because some of the parcels have. historic buildings on them. Some are already very-well developed and are unlikely to change, like Whole Foods or that document storage building, so it’s that kind of a analysis that would be really helpful, and we can go beyond the 1.15 FAR that’s been proposed and get a view of what would it be like, and that kind of analysis might also be helpful for the economist. Ms.Grote: I thinkwe have the beginning of that in the attachments that we gave you with the prototypes and it says, for instance, on the Staff recommended mid-block residential transition, it’s says that on a 110x80 foot lot, you can essentially get six units, with three-story townhouses, 30 units per acre. And you’d essentially get six units. On some of the other prototypes, it shows that you can get eight units. On another one, I think it shows you can four. When we used kind of typical lot sizes, we could try to do this prototype on a greater variety of lot sizes. And then you get a sense of how many units and what it could look like. Would that help if we expanded the prototypes a bit, the number of them and the type of lot size that they’re on? Commissioner Packer: If the other commissioners feel it would help. I don’t want to be the only one asking for this. Page 32 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Chair Burt: So, Alison, is it fair to say then, in summary, that on smaller lots, it’s going to be very difficult for a developer to build something that would even use a 1.15 FAR, whereas on larger lots, it’s much more economical to do so and more likely that that would occur? Ms. Kendall: Yeah. As soon as you get to the size that maybe sort of 10,000 square foot lot size, where you can efficiently doing the podium parking scenario, it’s the FAR that becomes the controlling factor, generally. But it’s definitely an issue how much guest parking, for example, you have provide and a whole bunch of.things like that, which are all difficult on these kind of sites. So they’re just very, very difficult, and the reality is, as you saw, and the developer cites, when they’re dashed, they’re all very weird shapes and they all have very unique conditions. Commissioner Cassel: And if we don’t allow any lot combining, then they’re going to keep that in a very awkward situation? Ms. Kendall: Yeah, we will tend to do that. What we have suggested is that these were sort of prototype size lots, but given the fact that they’re so few remaining developable sites, what we’re proposing to do in conjunction with the economic analysis is to take a few actual sites and play them out fully, because I think it’s easier for people to imagine the specifics of each site and we can take some of the larger end of the scale and then some of the smaller, and I think we can kind of get a sense of at what point do you really run into some just serious physical challenges in fitting in any kind of housing on the site. What we did point out to the working group is that absent a minimum density, you might actually find that a lot of the sites along Emerson and High might actually wind up being developed as small lot, single family housing, rather than even be attached townhouses, just because of the market reality being that you can get substantially more for that housing type on a for sale basis than for other types and the difficulties with solving the parking problem. Chair Burt: Karen. Commissioner Holman:~ You led right into a question I wanted to have some clarification on. Fifteen hundred square foot as a maximum unit size was chosen because, and why 1500 as opposed to 1200. There are three bedroom, 1200 square foot houses or townhouses, whatever, too, so how would that impact? Would somebody be as likely to develop a single-family, 1200 square foot house as opposed to a 1500 square foot house, and how would the 1200 maximum unit size affect other kinds of development if there were minimum densities? Ms. Kendall: I think the difficult is presumably a three bedroom apartment would require the same parking as a 1500 square foot apartment or unit, for sale unit. So, again, you’re going to be able to, the real expensive item here is the land cost and next to that there’s construction cost for the parking podium. So, you’d be undermining the economic feasibility for the developer without changing the number.of housing units possible on this site. It would tend to discourage perhaps a small lot, single family, but it may not be worth it for the impact it might have on the economic feasibility. Page 34 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Chair Burt: I think Steve wanted to make a comment, too. Mr. Emslie: Well, since you made the connection to the economic analysis, what I hear maybe we’re getting at is looking at that core area and looking at the development potential, looking at the lots that have the maximum development to the potential that we’ve already identified, and then looking at that as a total in terms of what numbers you could get at different FAR levels. If that’s what I hear you’re getting at, and that could be very important information in terms of the economic analysis. So, we can kind of look at that area as a group and look at what different scenarios would produce. Commissioner Packer: Yeah, and I think the other benefit that might come of it is that when it’s all said and done, and when people are concerned, oh, we’re not going to Manhattanize it, but say, total, we’re only going to put in a hundred more units. Oh, it’s maybe not so dense after all, or maybe it’s going to be a lot more and there is that so that we have a sense of what we’re talking about in reality. Chair Burt: Okay. Phyllis. Commissioner Cassel: Well, I tried today to take a 6,000 square foot lot with the density that we had at 1.15, and obviously, I’m not an architect and I haven’t sat here and done a lot of figures, but I did look up the amount of space for a parking space, and if it was going to take two parking spaces per unit, and you have a maximum of 1500 square foot place, and you had a 15 foot setback across the front of that for 60 feet, and I think I ended up with about 900 feet left or 1,500 feet left and no driveway to get the cars in and out, so it was very, very tight, and so I was kind of curious more in terms of numbers, whether this was feasible, I was hoping. Alison Kendall, Consultant: Can I make a comment on that? Commissioner ~assel: Yes, that would be helpful. Ms. Kendall: It’s tree that the very small sites are extremely constrained and what we found when we did the prototype which has the smallest lot size, slightly over 8,000 square feet, is that we basically are forced to do the parking on the surface, predominantly not covered or with carports, but basically you don’t even have the room todo a ramp to go down to the half below prototype, which is the most efficient and most aesthetically appealing solution for parking for multiple family residential in this area on most of these sites unless perhaps you have a comer lot, and then you might have a little bit more room. But all of those are very, very tight and they are very, very constrained. The comer lots have more possibilities, and as the lot gets beyond 100 feet wide, you have the possibility of doinga parking garage and accommodating the kinds of setbacks and so on that you generally need. But it’s very difficult, and the main constraint is the parking, number one, particularly if we were to use the 18.83 ratios, and the number two constraint is the floor area ratio, in terms of achieving the maximum densities, and we’re assuming that a developer would generally be wanting to build the larger units because the land value is very high and so they want to be able to either rent or sell at the upper end of the possible market. So, it’s very, very difficult. Page 33 1 2 3 4 5 6 7 8 9 Chair Burt: Let me ask. Has Staff had an opportunity to look at perspective.dates for continuing this hearing? Ms. Grote: It looks like June 5th would probably be the best date at this point. There is one other item and that’s your final recommendation on the bike plan, and also now, it would be SOFA II. Chair Burt: Does that seem fine with the Commission? Great. So how does everybody feel about wrapping up now and continuing it on June 5th? Very good. So, thank you very much. Page 35 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Planning and Transportation Commission Verbatim Minutes June 5, 2002 EXCERPT South of Forest Coordinated Area Plan - Phase 2: Continuation of the Planning and Transportation Commission review and comment on the Draft SOFA II plan. Chair Burt: There are people in the lobby waiting for the Item 2, SOFA discussion. Commissioner Bialson: I am going to have to leave at this time because I do have a conflict that doesn’t allow me to participate in SOFA II matters. That conflict is representation by my law firm of.Olie Christiansen who’s property is in SOFA II. Good-bye. Chair Burt: Commissioner Bialson will not be participating in Item 2. See you soon. Is the public hearing closed on this item now? Ms. Grote: Yes. Chair Burt: So just for clarification, we have previously taken public comments and the public hearing is closed. Lisa, would you like to introduce the topic? Ms. Grote: Thank you, Chair Burt and Commissioners. This is a continuation of your discussion of the SOFA II Plan. You did start that discussion on May 16, 2002. You asked that additional economical analysis be completed so we have hired Bay Area Economics to do that analysis. They are in the process of doing it and that is why we asked you earlier to have a Special Meeting on June 27th to be able to consider that. What they will be doing is taking some of the prototypes that Freedman, Tung and Bottomley have produced and actually model them whether or not they would be economically feasible. In order to do that, Alison Kendall will be working on some revisions to those prototypes so that they reflect a number of different options in regard to Floor Area Ratio. So we will have that at least in some draft form for you on the 27th. So tonight, we thought that you could continue talking about some of the general concepts that you started talking about on May 16th. Some of those include: whether or not there should be one zone over the entire area or perhaps two zones over the Phase II area; whether or not there should be minimum densities in the transit corridor; whether or not there should be height variations within the overall Phase II area; whether or not there should be different parking requirements in the transit oriented portion of the corridor; or whether we should implement our current parking standards which are found in 18.83 of the existing ’Zoning Ordinance. What the process for project review could be, I think we summarized what is in the plan as drafted now but also then the comments that we received from both the Historic Resources Board (HRB) and Page 1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 the Architectural Review Board (ARB). They had very different opinions on how to review projects within the SOFA II area. The topics that you may want to consider later after getting further economic analysis would be whether or not to include Planned Community zones in the area and where, if at all, to restrict ground floor office use and what those restrictions might be. Also, following up on transfer of development rights programs, whether or not their support, actually you could talk, conceptually on whether or not there is support for Transfer of Development Rights programs tonight. And I know one of the Commissioners had also recommended that you discuss expanding that concept to include Transfer of Development Fights for open space development, as well as Historic preservation. So you may want to discuss the concept of that tonight but defer further analysis or discussion of it into a later date. Those were the topics that I had written down from May 16, you may have some additional top(cs that you want to talk about, but those are the ones that I had written down that you could probably cover tonight or at least get started on. The other thing I wanted to mention is that Zariah has put at your places a couple of pieces of additional information. One is a map of the SOFA II area with a chart that goes with it that summarizes the assessor parcel numbers, the street addresses and the lot square footage along with an estimate of the FAR, the Floor Area Ratio on those lots. This data was pulled from [Metroscan] so it is not 100% accurate. It is an estimate but it does give an idea of what the existing Floor Area Ratios are in the SOFA II area. So that is one piece of information. We do have it also at the table over there to the side. There is also some additional information on parcels that are along Forest Avenue. We included those because there are a lot of residential projects that have varying FARs but that some of the Working Group members had been interested in knowing how did those FARs compare to what is in the SOFA II area now, and what do those FARs look like on the ground. So that was included at places for you. And then an additional piece of information that I’ll pass out now is our Historic list of those buildings that are on the Historic Inventory now, as well as those buildings that were found to be eligible for the National Register and eligible for the California Register by Dames & Moore who are the consultants that we hired to look at the entire City and eligible buildings for Historic status. The map is in your Plan right now. Bu(this is the corresponding list of properties that goes with that map. So with that, I would open it up for Planning Commission comments and discussion. Chair Burt: We have these other two maps, as well as the map that you have previously provided. Ms. Grote: Yes. I wanted to comment on those as well. We revised the Staff recommendation map so it correctly summarizes or shows what is written in the plan. We tried to put together, we called them Planning Commission Recommendations and I wanted to clarify that those really aren’t your recommendations at this point. That was premature to call them that. That was what you had discussed at the last Planning Commission meeting. Particularly with regard to heights Page 2 6 7 8 9 10 11 12 13 14 1.5 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 1 and where the 50-foot height limit may extend to. And again, that was not at all a formalized 2 recommendation. That was just a beginning discussion on the Commission’s part. Again, we 3 just reprinted the Working Group recommendations and put all of them in color so that they are 4 easier to differentiate because I think the black and white drawings were hard to tell where the 5 different zones really were. So they are shown in color up on the wall and in color in your packets or in your memos. Chair Burt: I had one additional item and maybe other Commissioners will have, we had a discussion on lot combining and how we would want to approach that. Or whether we could want to facilitate that or discourage it or encourage it or whatever? Any other major topics that other Commissioners have on their list? Phyllis. Commissioner Cassel: The FAR. Is that on that list? Chair Burt: I don’t know if Lisa said it. Ms. Grote: Yes, I had said one zoning district or two districts meaning, specifically should there be different FARs. Chair Burt: And what FARs within those. Commissioner Cassel: There was a question brought up in the Staff Report of about producing of housing. The Plan will produce enough housing and I presume we will discuss that later with the economic part of it. Chair Burt: So really housing amounts and housing types? Ms. Grote: You may want to talk about whether, and you can do this without the economic analysis but whether or not you support the concept of higher densities in this area. And whether or not you would support different densities in different parts of the area given the proximity to the train station. So, in other words, higher densities along Alma and High, or some area rather or over the rest of the area. Chair Burt: And then, I think complimentary to what Phyllis was talking about on the total housing amount and the type of housing. What economic segment would be served by the housing? There’s one other related item. And that is going back and looking at the sort of Mixed Use that we would want to encourage or allow. Right now, we have Mixed Use that has certain percentages allowable for office and would we want to look at a greater yet emphasis on housing either through an incentive basis or through mandated zoningl Commissioner Cassel: One other issue. I think we didn’t mention traffic flow and the questions, the Board recommends the two return to the 2-way traffic. Chair Burt: Yes. So traffic patterns. Bonnie. Page 3 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3o 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 46 1 Commissioner Packer: I think eventually we have to get to some of the details about the design 2 guidelines and the development standards and which is which because there’s some things are 3 qualitative and some things are quantitative and the way it is laid out in the draft right now. We 4 may want to look at that in greater detail. That is something I think we can do without the 5 economic analysis. I have a question about the list that we are going through right now. I 6 thought we were trying to figure out what we talked about tonight without the benefit of the 7 economic analysis. I was thinking that last time when we discussed about this, Istarted talking 8 about FARs and we can’t talk about FARs until we have the economic analysis.. So I don’t know 9 how the other Commissioners feel about it. Do we have some policy decisions that we want to talk about regardless of what an economic analysis might tell us or would we want to wait? Chair Burt: Well, how would we address that kind of policy decision without understanding the economics of it? Commissioner Packer: Exactly. So, we’re just listing these items that we are going to talk about without the economic analysis. Chair Burt: Lisa had identified PCs, ground floor office, and FAR as definitely issues that would need to have the input of the economic analysis. And did you say prospectively that TDR concept although that might have some discussion now and some later? Ms. Grote: That’s right. You could talk conceptually about TDRs. I don’t know how much additional information we will have in economic analysis about Transfer of Development Rights. We have hired the economic consultant to do kind of the basic analysis of some different FAR potentials and didn’t include the TDR program. We would recommend that that would be if even a follow up item after this gets through the City Council. And that if additional information .is wanted on the economics of the TDR program, that it be done at that point but.not before. Chair Burt: Bonnie. Commissioner Packer: So that brings me back to my question about the zones because the zones are initially defined by.F_~ARs and heights and things like that that we are going to discuss after the economic analysis. So I would recommend that the issue of zone to where they would be might come after we have a more thorough discussion on. Ms. Grote: Yes. Alison is mentioning that we could talk about physical design with different FARs currently because we do have some prototypes developed and she can go over the details of those physical building results. Chair Burr: I envisioned that we would discuss tonight conceptually wheth’er there would be one or two zones and where those boundaries, based on our current thinking, might be with a final recommendation pending the economic analysis. Wynne? Ms. Furth: Two things. One is that when you are talking about how many zones for us in drafting, what we are interested in knowing is do you think there should be uniform standards across the entire area or if the standards should vary. You can figure out later how to describe Page 4 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 .39 4o 41 42 43 44 45 46 that whether it is overlays or lot by lot descriptions since you are dealing with such a small area. But the question is what standards should be uniform throughout the area, except for R-2 and whatnot, and what standards do you think should vary across SOFA II. That is one part of it. The second part of it is that as Alison says, there is a lot of thinking you can do about what does a particular FAR look like, what traffic might it generate, how many units might it have. The economic study isn’t going to dictate your ultimate answer. It is going to tell you what range of things are feasible and whether something you propose is likely to get you to one of the goals you’ve adopted. For example, generating a certain number of housing units but it is only a part of your decision-making. Chair Burt: Right. Karen. Commissioner Holman: I have two or three things. One would be when we’re talking about FARs and heights, can we combine in that same conversation the density? That should be part of, I think of that same conversation. Ms. Grote: That would fine. Chair Burt: Excuse me, by density, how are you differentiating that from the FAR? Commissioner Holman: Number of units to theacre because it’s not necessarily, it’s notthe same thing. Chair Burt: Okay. Commissioner Holman: Another would be a policy addition that I would like to make. And I would like to hear other Commission member comments on it. And that would be an addition of not losing any existing housing units. That policydoesn’t exist anywhere else in town and I would like to see that there’s a no net loss of any housing units that currently exist. Chair Burt: Do you mean net for the overall plan or you mean each individual parcel? Commissioner Holman: Each individual parcel because there are many, many different owners in this area. So if there are three units already existing on a parcel, I would hate to see that lost for the sake of some other purpose or fewer housing units. Chair Burt: Okay, that can be a topic for discussion. Ms. Grote: And that would then be on a policy b~isis so you would be recommending that the Commission discuss adding that as one of the policy statements in the housing section of the plan. It is a policy in the proposed Housing Element. So it wouldn’t be inconsistent with what kind of direction the City is considering citywide. Commissioner Holman: Great. Then just, I probably didn’t articulate this very well last time, but I was thinking there were a couple three things that we could just tick off and get accomplished. For instance, where the R-2 zone is now, can we just agree that that is where we Page 5 1 2 3 4 5 6 7 8 9~ 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 want to have the R-2. Or should it be R-1 since just most of us are represented there? There is a coruer of Homer and Emerson, which is probably RM-15, if not RM-30. There’s some things like that I think we could just tick off and have done. And maybe we could agree or not that Homer Avenue should be 35 feet both sides. There are some things like that I think we can just accomplish, get them done, so that we are not just leaving everything til!the last dog is dead. Chair Burt: Well, I would certainly support addressing as many of those as we can by. 10:00 p.m. So I think this is a good list. In reality, I think we are not going to be able to complete this discussion tonight. So out of this list, why don’t we identify those things that we think are most important to accomplish tonight? We just had a list, hopefully, everybody’s got a pretty good sense of it. Commissioner Griffin: I have a question. Could you just run through the difference between residential transition, this is called RT-35 and pedestrian oriented residential transition, RT-35? Ms. Grote: The residential transition is a t.15 with up to 1.5 with a PC. Whereas, the pedestrian oriented residential transition doesn’t have the option to have the PC with the 1.25. We tried to summarize that in the chart. Chair Burt: Can you identify that again on which chart? Ms. Alison Kendall, Consultant: Basically the pedestrian oriented designation was predominantly for Homer Avenue and for Emerson under all of these concepts. And that really grew out of the original Working Group recommendation to basically allow only residential or retail ground floor uses on those streets. It was sort of a broader waY of expressing that it should pedestrian oriented and pedestrian generating uses so there are limitations on office uses in those, ground floor office uses in those districts in order to further that goal. Now there are slightly different approaches that might be possible to achieving that goal obviously. Commissioner Holman: Alison, I believe it was not just retail but neighborhood serving as well on the ground floor. Ms. Kendall: Only neighborhood serving retail under the Working Group scenario. Ms. Grote: It is actually neighborhood serving uses. So it could be business services, it could be personal services, it could be other types of neighborhood serving needs. Chair Burt: I just added Item #18 for our discussion which is the sort of services or retail that would be prescribed by the plan. Ms. Grote: They would be neighborhood-serving uses which could include personal services, it could include business services, it could include other types of neighborhood oriented uses serving retail and restaurants are to be included in that. Chair Burt: Alison, would you like to walk us through some things? Page 6 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 2o 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 46 Ms. Kendall: Yes. I wanted to describe sort of generally what the differences are in terms of the plans and then also what are some of the findings from looking at the prototypes so that you can really understand some of the variables that you working with in terms of the development standards. So just conceptually, the Working Group recommendation, which is represented here, did include the idea that, as we mentioned this pedestrian orientation for these two major streets. It also included the concept of a higher height limit on Alma but it does not increase the Floor Area Ratio. So to .some degree, it is a little bit unclear to what degree a developer would choose to build at four stories rather than three, the full 50-foot height limit given that their Floor Area Ration would remain 1.15, which is we illustrated over there is more of a two to three stories height limit. The other thing that basically distinguishes the Working Group from the Staff recommendation is the idea that there might be larger area of the 50-foot zone and that within that area that can be 50-foot high that there would be the possibility of using a tool like the Planned Community permit to increase the FAR up to 1.5 and that could include some very specific public benefitS. For example, affordable housing, open space, public parking. Ms. Grote: Community services, childcare. Chair Burt: A question for Lisa and Steve. Is the Staff also awaiting the economic analysis to prospectively revise their proposal on that basis? Ms. Grote: What we are going to be doing in the economic analysis is to take the 1.15 FAR and set of constraints in the Working Group scenario, take the 1.5 Planned Community sort of approach that is an option within the Staff recommendation. And then take a sort of hypothetical higher FAR that also is a little bit more p;rmissive in terms of ground floor uses and test that mostly because we want to make sure that we find out at what point we get the kind of economic motivation that would actually induce a property owner of an existing property to go through the development process and hopefully produce some housing. So, we are really trying to find out what it takes to get that to happen under normal set of criteria. Ms. Kendall: So in terms of just stepping you through the prototypes, I think there are some very interesting things that we learned from doing this and I wanted to make sure that it was as clear as possible to people how we were able to develop these standards. And actually with the Working Group really, we were able to refine those standards quite a bit as we found out that sort of inadvertently certain fairly arbitrarily chosen numbers were becoming constraints to producing housing on the site. We actually did have a good dialogue and modified the Working Group proposal quite a bit, and then in turn the Staff proposal in response to learning about this. One of the things that we looked at with this scenario is the [rear yard] dimension which turned out to be, would be the initial one was something lille 20 feet which was a fairly large rear yard dimension and was ending up basically constraining the parking and, therefore, meaning that there were far less units on the site. So that was something that we were able to adjust. Page 7 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 46 At this point, the real constraint was the 1.15 FAR. It was a combination of the Floor Area Ratio itself and even more importantly, the parking requirement. The parking requirement under the Working Group scenario is the 18.83 standard zoning requirements, which mean that the average 1,500 square foot larger size unit would require two parking spaces plus the guest spaces. So that in turn basically ends up working backward to constraint the number of units you can put on the site. To some degree, the 1.15 FAR does that also but I would say that for most sites, this is a fairly large easily developed site. It is a corner site, which means that you can bring your parking access in from the side and get a very efficient ramp and garage configuration compared to a mid-block parcel. But even on this parcel, the numbers are fairly challenging. The other thing that we did adjust with the Working Group was the knowledge of how important this parking constraint was, was the idea that tandem parking would be permitted for multi-family units. It is already permitted for single-family units and that can provide far ’more efficient parking spaces per construction costs for the garage. So you really can get more spaces in, you can provide most units with their two units in some sort of combination of either single spaces or tandem spaces. Chair Burt: I am sorry, were those tandem spaces be on a per unit basis, not shared? Ms. Kendall: Yes, in other words you and your husband or something would be sharing a tandem space but you wouldn’t have to coordinate with your neighbor. Commissioner Griffin: Alison, these comments that you are making are not in this comment block. This is new stuff?. Ms. Kendall: They are in very, very shorthand form. They are in this sort ofc0mments. I’m kind Of adding a little bit of explanation for you to try to understand what with each one becomes sort of the most critical Set of issues. So I think, one thing that you can notice with this scenario is that it is predominantly basically two-story development, it is over a podium, that you could develop this kind of density which is, I believe is roughly 24 units to the acre so it is not achieving the maximum density but it is a fairly respectable moderate density project with only two stories plus this sort of attic space. You have it over a podium so you have slightly less expensive parking than if it were fully underground. Commissioner Packer: What is the lot in square foot, the lot size? Ms. Kendall: This lot is 110x150. I forget offhand what all that calculates into but it is basically 16,500 or something. It is roughly a third of an acre, so we calculated it to basically nine acres on this size lot or the equivalent of 24 units an acre. This is a fairly, there are actually lots out there that correspond to this size. It is roughly a third of the lot depth and this is a standard depth. However, there is not an alley basically in the SOFA. Although every lot has its own peculiarities, this was one that does exist. Ms. Grote: If I could point out, in the Working Group alternative they did not recommend allowing tandem parking. It was in the Staff recommendation that the tandem parking came out. That is why you’ll see the difference between the Working Group number of units in that Page 8 1 2. 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 46 prototype and in the Staff recommended residential transitional prototype. I think there are two more units in the Staff recommended version partially, there are other things that went into that but partially, it is because of the tandem spaces. So the parking is~ a critical element in what you get on the site. Chair Burt: What Staff recommended, is that 29 anticipated and 24 on the Working Group? Ms. Kendall: Right. Recognize that you have more units in this scenario, too. But yes, if you are not able to do the tandem parking spaces, then you really are constrained to a fairly low number of units on the site. Chair Burt: The second map that says 24 units per acre, that’s with tandem parking? Ms. Grote: NO, that is without. Chair Burt: SO with tandem, then you bridge the gap between the two? Ms. Grote: Well, it’s actually tandem and a reduced parking ratio to begin with on a per unit basis. So you really need reduced parking plus the opportunity to have tandem spaces that would get you up to 29 units per acre. Whereas if you have the standard parking requirement, you are down to 24 units per acre. Ms. Kendall: Exactly. You can get basically to the 30 unit per acre maximum even on a somewhat constrained site and even within a basically two to three-story height. Commissioner Cassel: Alison, you are using tee 1,500 square foot maximum Size unit in doing that? Ms. Kendall: Yes. Commissioner Cassel: So people could put in smaller size units? Ms. Kendall: Yes. They could do that but actually, they have to be substantially smaller before they drop down to a lower parking requirement. So that is not a cost effective way. Commissioner Cassel: No, but you happen to have some of them as 1,000 square foot units and it might take several of those to make a difference in the numbers. Ms. Kendall: Yeah, the parking requirement is based on number of bedrooms. Commissioner Cassel: No, no, the parking would be the same anyway. You would presume and I realize that, but the units don’t have to be that big. Ms. Grote: You couldn’t get more units because you couldn’t provide the parking under the standard parking. Page 9 1 2 3 4 5 6 7 8 9 10 11 12- 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Commissioner Cassel: anyway. Chair Burr: Bonnie. But this is proposing a maximum of 1,500 square feet in this area Commissioner Packer: It doesn’t become really cost prohibitive to have two underground levels for parking? Ms. Kendall: Yes, it is very, very difficult. You would not want to do it for this kind of housing project. We actually did look at it for higher densities assuming that there was a fair amount of office included in the project. But here, you have a podium parking design. To go down another level requires a ramp that is equivalent of something like 80 feet long. To even fit that on this lot gobbles up a good portion of your parking garage. So, e’ffectively you don’t find it very often. The one exception is that the SRO has used that approach by putting the parking actuNly one level is half below and the other level is actually half above. And then they’ve got some tall retail/office kind of spaces on the front so you are not looking at the parking garage. That approach is something that we illustrated in an earlier version of this scenario ac~ally where we looked at that kind of strategy rather than a fully underground level. The problem was that the zoning basically penalizes you for doing that even though you are not having to look at the garage it is contributing to the bulk that is above the waterline as it were, above the grade and, therefore, it is counted within your FAR which is a very unattractive scenario obviously for a developer. So the ideal scenario is to try to get your parking not to count into your FAR and to instead have revenue producing uses whether.they are residential or office. Chair Burt: Bonnie. Commissioner Packer: So that begs the question is that something we would want to look into in certain situations where you need more parking whether you can give an FAR benefit so that kind of parking wouldn’t be counted into the FAR. Ms. Grote: Or that you design it in such a way that it is four feet or less above grade and then you wouldn’t count that as FAR. Chair Burt: Is that the way it is proposed? Ms. Kendall: What we are proposing here is that we were basically not counting this parking because it is effectively three to four feet maximum above the grade level. So it is really experienced as just the podium of the residential and not as the whole level. Chair Burt: So it is similar to the standards that we have for R-1 and a basement and all of that? Ms. Grote: Right. Exactly. Chair Burt: And you were saying that the podium parking is considerably more economical than even a single level fully submerged parking, is that correct? Page lO 1 Ms. Kendall: Yes: One o,f, the things, it’s less excavation for one thing: It is also possible to do a 2 little bit of natural ventilation. It probably would not be fully naturally ventilated because you 3 would want to manage the appearance of the street sides and make them appear to be solid and 4 not be looking into the parking garage. But on the backside, you can usually get some 5 ventilation which helps decrease the cost of the artificial ventilation in the garage.; So all of those 6 things would help. 7 8 9 10 11 12 13 14 15 16 17 18 19 2O 21 22 23 24 25 26 27 28 29 3O 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Commissioner Schmidt: If you lose some space with parking at the ramp? Ms. Kendall: Yes, that is another important consideration. The ramp is only 40 feet long instead of 80. Chair Burt: Phyllis was raising the issue about different unit sizes and it seems that the scenario we have is going to make it so that if the same parking is r~quired for a 1,500 square foot unit and 1,000 and we have a cap of say, 30 units per acre, we have virtually no incentive for a developer to put in smaller units. Is that a correct interpretation? Ms. Kendall: It would be accepted as part of our roles. Chair Burt: I would be interested in what alternatives we might have to address that in a way that we might find more favorable of having a greater variety in unit sizes and costs, affordability. Commissioner Schmidt: You said that this is a comer lot with good accessibility and so on. Are there many sites in this 9-block area that can support very many units? We have a lot of little pieces there. Ms. Kendall: The basic answer is there are not very many substantial sites. There are very few that even work reasonably well for podium style parking which is kind of the most efficient, most cost effective parking style for this type of area with this type of land cost and so on. IfI point over here, these on~s that are outlined in dashed lines basically represent the relatively few major development sites in the SOFA areai Thatis based on a very quick analysis of places where the FAR is say .5 or less, places where the lot sizes don’t have an historical structure with major constraints, it doesn’t have an extremely awkward, very narrow configuration for example. So the few that we were able to identify that either have been discussed in terms of redevelopment in the recent past or appear to have some potential for redevelopment are here and we are including even the Whole Foods parking lot, which obviously would be a pretty complicated scenario and you’d have to replace all the parking. Nobody as far as I know has mentioned that so far but it is still theoretically possible. Most of the other sites, it’s mostly because they have a relatively small building on them or there’s actually an actual proposal that has been raised on them. Commissioner Schmidt: .So then these sites outlined have Historic structures as well? Ms. Kendall: Even some of these do have constraints, yes, that’s true. In fact, this one for example is an Historic structure but the discussion is to perhaps use some TDR approach to Page 11 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 2O 21 22 23 24 25 26 27 28 29 30. 31 32 33 34 35 36. 37 38 39 40 41 42 43 44 45 46 develop the two sites that belong to the same owner. So there are possibilities out there but if you really look at it, they are relatively limited. The 800 High one is a very developable site in terms of configuration. The Peninsula Creamery kind of parking lot picnic area, whatever it is, is another. Almost all the rest of them have existing structures that have some economic value. So you. have to actually compete with the kind of simpler scenario of converting those into some sort of use that can continue. Commissioner Schmidt: And then, as I recall in the Staff Report, it said that the length of this plan is likely 10 years or something like that so it’s possible that there may not be much change in the area in that amount of time. Ms. Grote: Well, I don’t think the Staff Report said that part. I think the Staff Report said the life of the plan may be 10 to 15 years. And in fact, things may cycle through in.that time. Commissioner Holman: There was also some discussion of this being a 10 to 20 year plan. How did we arrive at 10 to 15? Ms. Grote: I think that is an estimate. I don’t think we ever said this is intended to go for ’x’ number of years but it is a range of 10 to 15 or 10 to 20, until we redo it as a City. Chair Burt: I’m sorry, rmjust going to add that issue as one is the intended life of the plan as something we may want to discuss. Ms. Furth: There are two aspects to this intended life of the plan. One is how long you expect these regulations to generally to stay in effect. And there is no sunset provision or proposal for a sunset provision, they might be there for many years. The other thing is when you are looking at its redevelopment goals and what is your timetable for seeing the kind of change you want to see. Chair Burt: Right. Bonnie. Commissioner Packer: Dealing with the third of an acre, we have certain restraints. Does the flexibility increase proportionate to a larger size or does it even geometrically increase, let’s say you had two2thirds of an acre, do you get more than twice the amount offlexibiiity? In other words, can we be thinking about zoning that in a sense developers to want to combine lots in order to achieve a better project? Ms. Kendall: Definitely a larger lot is less constrained and opens up more possibilities. One of the special challenges in the SOFA area is we don’t even have an increment that is really optimal. For example, in downtown Mountain View, we had blocks that were 150 feet deep. And you can do a parking garage much more efficiently at 150 feet deep than you can on these parcels, so there are just awkwardnesses that come from the very specific scale of this area. For example, this is a typical block along Alma, all of those lots are 105 feet deep. Then thye have the alley that is taking some of the block width that is only 20 feet wide. Then they have another 105 roughly foot parcel on the other side. The 105 feet is a real nightmare as any of the developers who have tried to work with it. It is not really quite wide enough for two full bays of parking. It requires [reduced contortions] to use that efficiently. And it also, if you were to, for Page12 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 example, in the case of the SRO, if you do a piece of parking that’s kind of in the back and it is screened by other uses, the uses that are screening it are very, very narrow because your typical double parking bay is about 60 feet. You only have about 40 feet of stuff to put in front of it that is not really enough for any kind of viable retail, it is a very awkward office as well. It is just very difficult. That’s all I can say. So, we really are trying to work with the specifics sizes and dimensions that are found here, particularly the depths. That’s really one of the biggest constraints. Chair Burt: Karen. Commissioner Holman: I don’t mean to throw you a curve, Alison. But these drawings that were from when we were looking at SOFA I and there is not that much difference between 1.0 and 1.5. There werevery different configurations used for but possibilities, there could be. So I guess I am looking, and these don’t have like the whole grid information accompanying that. But I would assume that I think these were done with current parking requirements. So there is quite a difference between these examples and that (these examples). So could you speak to that? Am I throwing you a too big of a curve here? Ms. Kendall: Well, this I don’t recognize exactly but it is similar to some small lot single-family type typologies that we looked at earlier. So this looks like a 50x100 foot lot, or maybe 150 possibly, with something that is similar in massing to a single-family house and a kind of garage/carriage house unit. There is the possibility of developing some of these smaller lots in that way. Actually, we did have a sort of 3rd scenario that was for smaller lots. The fact is that there is quite a market for those things but there is a limit to how much density you can get with that kind of type. So it generally goes up to maybe 17 or 18 units per acre. So you can get the kind of bungalow court little design that we looked at for the other part of the SOFA area. To some degree, you can do it as sort of a townhouse type unit maybe with a token little five foot separation, but you really don’t get quite the densities of 20 units per acre or 30 units per acre. So, if you want to start to get those, something more like that kind of density you are looking at a kind of townhouse design. This is even more efficient than the townhouse in that the parking is pooled and the podium underneath. Whereas generally when you have to have individual garages, that is going to take a little more space. Chair Burt: After you receive the economic analysis, will you be able to provide some approximations of what you would guess would be the potential number of housing units over say, the next decade? That is a very hard thing to estimate but one of the things we are trying to figure out is how many units would in all likelihood get built. I recognize that, that’s going to be a pretty subjective appraisal but I think I’d certainly welcome whatever you are able to provide on that subject. Ms. Kendall: We can do that. We are always trying to guess about some tl~ings that are really not entirely rational economic decisions. So the economic analysis will allow us to kind of get a rough sense of the residual land value under different scenarios of development standards. And then say, okay, if so and so is here who does auto repair business and if he knows he could convert to general business service without investing a whole lot of money and get ’x’ rent or you he could go through much more headache and cost and do this, would he do it or not? So I Page 13 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 ¯30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 think we can do that. We can’t really account for the fact that he may just not do it because it is too complicated. Chair Burr: Right, right. So it may need some pretty broad ranges that you have to provide. Ms. Grote: I think that is what we would be looking at. I don’t think our economic consultants will be doing that but they will be giving us the information so that we can do that and make that kind of estimate, again range. Ms. Kendall: I think that sort of underscores one of the really key points about trying to encourage housing is to the degree you can have development standards that are fairly clear and have a clear statement that you actually do want to have housing at a certain density and not be giving double signals which is fairly common for City Council that sort of want housing but don’t want the neighbors to be complaining that it is big or different or something. So to the degree you can work through that and then come out with what exactly you want and show it in a prototype or something, you are more likely to actually get the projects that you might have. Commissioner Griffin: Can I ask a question in here? Chair Burt: Yes. Commissioner Griffin: Alison, ifI understand it, you are saying that this template that you have up here really dimensionally does not correspond with the smaller parcels that we are contending with in the SOFA II area? Ms. Kendall: Well, for example say, a lot of parcels are smaller than 10,000 square feet. So this one is already at basicaily 16,000 square feet. Commissioner Griffin: So when we come back and do this again, is it possible with your CAD/CAM to adjust to this so that it more closely reflects the parcels sizes that we are actually. faced with down there? Ms. Kendall: There is such a range that we are sort of wrestling with that. What we have, what we decided to do for the economic analysis is to look at a basic sort of 100xl00 or I think it is 105x100 parcel, which is fairly typical and on the smaller side and what is possible on that. Commissioner Griffin: And then I am thinking if we went through this lot combining process, for example, I’m not saying we’re going to agree to that but if we did, then we could make these. modules and we could tack them on and perhaps get the facility for more parking and whatnot that you have been talking about. Ms. Kendall: Right. It seems that this 100x100 is sort of the threshold at which, particularly if it’s on the comer, the threshold at which the podium parking starts to work reasonably well, smaller than that it is fairly difficult. Page 14 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 46 Commissioner Griffin: And you can get them so that they are in this 35-foot height zone, for example? Ms. Kendall: Yes, it can work within the 35-foot height zone. For example, this works within the 35-foot height zone. We did refine a little bit how it gets measured. Commissioner Griffin: I mean, that is the predominant preliminary zoning that we have up here are the 50-footers. So I am trying to make this reflect as much as possible but we are actually going to wind up with. Ms. Kendall: Yes. So you get two to three stories at the 35-foot height. Chair Burt: Karen and then Bonnie. Commissioner Holman: There’s another scenario that we haven’t really talked about. And in this scenario, I was kind of grinning at Kathy because I can see her looking at these plans and just thinking real hard, being an architect. There’s another scenario that we haven’t really talked about whichwould be there are some smaller lots here. But if you have a 6,000 square foot lot, I go back often to the houses that were on Bryant that have now been lived in become single- family homes. But some of those had 3 and 4 living units in them. So, I am thinking, what would it take to get someone to take a 6,000 square foot lot, for instance, and put in three 700 square foot units? And if we allowed uncovered or carport parking that could not be enclosed at a later date? Could we accomplish some of the housing that we are after without ending up with big boxes even podium parking because it seems like in this area, that is going to be more likely where we are going to see development since there aren’t very many big parcels. Commissioner Cassel: Because I did the numbers last week and I couldn’t get six or seven parking spaces on a lot with 6,000 square feet even at that size units. Chair Burt: What is the threshold of where the parking requirement drops on a unit size? Ms. Grote: Studios are 1.25 spaces per unit and then a one-bedroom is 1.5 spaces and then two bedrooms is two spaces. Commissioner Cassel: I want you to have a half the quarter of a space and see what you do with it. Ms. Kendall: There definitely are some scenarios as I mentioned. The bungalow design, there’s the duplex, there’s a sort of a four-sided, it’s kind of four houses that look like one. So some of those have been developed in various places. The four-sided one actually, an example that just being completed in Mountain View and that’s kind of an interesting one because it can function with the podium parking which is efficient if you have the right size lot which would need to be say, 80 feet wide or that a minimum I would say. Chair Burt: So an 8,000 square foot lot approximately? Page 15 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3o 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Ms. Kendall: Yes, you could conceivably make it work on that with the fight development standards and so on. Chair Burr: Bonnie. Commissioner Packer: I have a question on the opposite end of that spectrum because we do have some areas that would be 50-feet high and some larger lots. What kind of FAR’s would work on those lots to create buildings that have enough parking either in the lower part of [inaudible] and that’s the smaller unit, as well as the open space and the daylight plane that are those kinds of nice things so that we don’t have boxes. Do we have any sketches? I don’t understand what the relationship has to be in between the height, the density and the FAR because for us to dictate an FAR and a height and relative lot size that I know what we’re going to end up with. So if there’s some information on th~it, I think it would help us in making decisions about the 50-foot height. Ms.. Kendall: Well, we are looking at that really right now with doing the higher density prototype and sort of being open minded I guess about what that number is and trying to work within a 35 to 50-foot height and trying to get some amount of stepping down at the edge of building so that it doesn’t sort of loom over you and also some articulation and the massing. This is not exactly 1.5 in that the way we measure the FAR, this parking which is exactly at grade level would normally be counted into the FAR. So if you were to count that in I suspect this one is perhaps at 1.7 or something. I don’t have an exact number but you can kind of estimate it. It is approaching, too. You do wind UP with some funny things because of the alley, for example, you’d like to have some convenient parking maybe off the alley. So you wind up actually kind of decreasing the FAR by narrowing the building down to do that parking. So you have a lot of kind of issues that come up. You find yourself wanting to break up the massing and so on. So it is not like you want to have a big block that goes up three stories. So my feeling is that 3.0 is too much because we do want to have articulation. We certainly want to have a sense of the original sort of grain of the area, the variety to have it not look enormous next to the older buildings that are right next door that may well take forever or never change scale. So we are sort of testing right now and our feeling is it is something perhaps in the neighborhood of 2.0 and it’s probably not more than 2.5 in terms of what would sort of feel like too much even no matter how fabulously it is designed it is going to seem like a lot to put in that location. There are some subtleties about how you are measuring in terms of are you counting that parking that you can’t see but that is contributing to the amount that is above ground. What we are proposing is to just adopt a standardized way of saying if it is half below grade or less, we’re not going to count it in the FAR. Commissioner Packer: Does that prototype assume the current parking requirements? Ms. Kendall: No. This one was developed again with the reduced parking requirements that the Staff recommendation included, which was the 1.5 spaces per unit, for example, for residential and so on. No guest spaces was another Staffrecommendation and the possibility of a sort of discount on both office and retail so it is business service. There is going to be incentive for retail that says that the first 1,000 square feet doesn’t have to provide parking and then you have both [inaudible] then you do because retail parking requirements are very high. And basically Page 16 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 -31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 given that retail on its own in the SOFA area is difficult. The fact that you have to provide this very, very expensive parking which in all likelihood actually wouldn’t probably be used much by retail customers because they don’t really want to go driving down into a garage just to pick up some milk or a sandwich or whatever. Chair Burt: One item that might tie into that at least on High Street is a discussion that we have brought up a couple of times of the prospect of turning High into one lane, one-way and increasing the on-street parking with diagonal parking on one side and hopefully still be able to retain parallel parking on the other side. If we could have a little more exploration of that, that could help us in our consideration of the viability of the retail. Ms. Grote: We had originally hoped to get a grant to do the parking circulation study. That wasn’t approved. We didn’t get that money so we have recommended deferring the transportation circulation parking aspects of this to a follow up action rather than trying to tackle that at this point. Chair Burr: Kathy. Commissioner Schmidt: Is there a different way to approach this? Is there a simple way to do this? It seems like there are so many details and it is such a complex puzzle and there are so many existing pieces. And we are trying to imagine what could happen and we are probably not imagining what would really happen and we are still trying to analyze every possible thing. It just seems like we are making it way too complicated. Is there a way to do this in a simple way? If we want to have incentives for housing, we want to say taller toward Alma and 35 on Homer or just some guidelines or something and then we have a designer view. I know the purpose of a coordinated area plan is really to kind of get everything zoned and then projects can happen but it just seems to complicated. Ms. Grote: I think you’d have to be fairly fine-grained because that is the charge of the coordinated area plan. We are working within a policy framework that requires us to do certain types of economic .analysis and other kinds of very specific evaluation. We have tried to keep it, and I know these are a little complicated but we’ve tried to keep it somewhat general in saying okay, higher heights and densities towards Alma, then transitioning back towards the residential. Those are the bigger concepts in retaining Homer and perhaps Emerson as kind of a neighborhood-serving core whether they’re all retail or othertypes of uses but a neighborhood serving core along those streets. SO to keep that kind of general but then to really start looking at the specific applicability of that on very specific sites and use some examples that say~ will those general concepts work when applied to this size site? Will they work better or differently if they’re applied to a bigger site? We are doing that specifically because of the policy framework that the Council passed requires us to do it as part of the plan. Ms. Kendall: I have a comment on that, too. I think the one thing that really came through to me and frankly, there are fewer potential sites than there were three years ago when we started this process. So, at some point you really are dealing with so many peculiar and very particular issues. What it really seems to indicate to me is that there is actually a value to having something like the PC process but with more structure to it so that people know exactly what Page 17 1 2 3 4 5 6 7 8 9 10 11 12. 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3o 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 46 public the benefit is and what the trade-off is. It provides an increased sense of confidence by the developer that they are going to finally get out the other end with something that will be approved or approvable. It also provides I think more comfort potentially to neighbors to know that there is, for example, a maximum FAR and there is some really tangible benefits that they agree are valuable open space, for example. Perhaps affordable housing, perhaps public parking, perhaps certain kinds of retail that are guaranteed to be retail. There might be real value in sort of spelling it out and letting people take their team and really approach each site and do the best possible job with it but within the set of overall constraints that is not completely open-ended. I think that is the concern historically with the PC process. Ms. Furth: Although it is a fine-grained, look, because you’re looking at a very small area, when you take out not only the site that’s been recently developed, there’s a fair amount of the spaces are already a PC, that they’re approved PCs, probably [internet] those out, too, in our next iteration of the map. There is nothing that requires you to have specific setbacks or specific parking requirements or any of those things in the legal framework. I think it is a practical matter to provide both the assurance for those who live there or have property there and for those who want to develop you need to set some margins but you don’t have to have all these standards if you don’t want. I think there’s a better way to do it. Chair Burt: we are now 25 minutes past our intended closing time. So, if it is all right, we’re going to have to cut off. Commissioner Holman: Just one little quick thing that Alison was saying about PCs. That is kind of where I was coming from with the TDR’s is we could decide a variety of locations where we thought that [pocket parks] might be a good thing. And rather than waiting for somebody to come along and say, I want to develop here and a part of this is going to be public open space. We could decide where the best places are for pocket parks and allow, so we are in charge of the process, the City is. So then allow TDR to be used at a particular site and let somebody develop to a greater extent someplace else but you get the pocket park where you want it and control the design of it and the maintenance of it. Chair Burt: Last one. One more? All right. Commissioner Cassel: No, no, I’m willing to quit because this is a whole long discussion of how big this area is and how many more parks are going to be put it in. Commissioner Packer: Keep in mind that SOFA I, we were dealing with one major property owner and here we have out of how many zillions of property owners and it’s a very different way of looking at things. And if we’re trying to work with the criteria that the Council set up when it was one CAP for an area, I think we’re getting ourselves boxed into the wrong direction. And what Kathy said and what Alison Said, maybe we have to think about a simpler way and a way to allow developers to have the flexibility through a PC but with greater parameters in our existing PC process process has. Chair Burt: More defined you mean?. Page18 1 2 3 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3o 31 32 33 34 35 36 37 38 39 40 41 42 43 44 Commissioner Packer: Yes, more defined, more detailed parameters. Ms. Furth: Pat, ifI could say one more thing. The other thing is we have a lot of use definitions which you have been struggling with and the Council has been struggling with and the public has been struggling with for the last few years. You don’t have to use any of those. You can define the range of uses that you think are appropriate on Homer or on Emerson or in this area. Think about what those uses are and we can develop a term and a definition. So when you are thinking about what you want to do, sometimes it is helpful to think about the outcome you want rather than in the categories we already have. We know they don’t adequately get where you want to go when you’re thinking about neighborhood commercial, for example. Commissioner Griffin: So ifI want Watercourse Way to stay as sweet as it is, we can do something? ’Ms. Furth: The spa is high priority, ten points. Commissioner Griffin: We can call this Water Course Way zone or something? Chair Burt: No, you can’t do that. Commissioner Griffin: I’m asking the question. Chair Burr: I’m telling you. Ms. Furth: If you can articulate that you think that is a valuable use, then we can try and figure it out. First of all, you can say it, this is a CAP. This has all kinds of discussion in it. You can say along the wonderful features of the area is or are. I mean, we have this rhetorical section so you can put it in there. But we can also be sure that we specifically say that that’s the kind of uses permitted. Commissioner Holman: And another way to retain that kind of specific use is don’t put a 50- foot height and a 3.0 FAR on the parcel. Commissioner Griffin: Maybe that was what I was getting at. Ms. Furth: And encourage seismic upgrades. Chair Burt: We will continue this item to June 27th, a Special Meeting on Thursday at 7:00 PM. And we’ll define, potentially in this location. Ms. Grote: Zariah, do you have a date for the Council? Chair Burr: Is this available? It is not. All right. So the Council Chambers on June 27. I would like to then adjourn this item until June 27th. Page 19 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Other Items: 2. Planning and Transportation Commission Verbatim Minutes July 31, 2002 EXCERPT Continuation of review and recommendations regarding the South of Forest Coordinated Area Plan Phase 2. Ms. Grote: Thank you Chair Burt and Commissioners. Tonight, before you is the opportunity to make your final recommendations on the SOFA 2 Plan. This was before you in May and June at which time you talked about two of the 12 primary topics that are encompassed in the SOFA 2 Plan. Those included height and floor area ratios. The topics that you have to discuss tonight are the ten remaining topics. Those include whether or not to allow Planned Community Zone Districts, whether or not to have a reduced or standard parking rate for the area, where and if to reduce or prohibit ground floor offices in certain locations, what the maximum or minimum residential densities should be in the area, how to deal with non-conforming uses and facilities, historic preservation, floor area bonuses for both seismic and historic upgrades, transfer of development rights programs, how to deal with alleys and then finally the process. In your packet we included a revised map, which is now entitled, "Planning Commission Discussion," rather than Planning Commission Recommendation because you have just started your discussion. That included potential areas for a higher than 1.15 overall FAR and also where a higher than 35-foot height limit might be considered and that would potentially go up to 50 feet in height. So that was included in your packet and it is called, Planning Commission Discussion. Then in addition we included the Working Group recommendations and the Staff alternatives to a couple of the Working Group items. Those primarily focused on again, where to include slightly higher floor area ratios of up to 1.5 and then where to include higher or taller buildings up to about 50 feet. So those are shown graphically in the packet.~ The primary topics to discuss tonight are the PC Districts and whether or not they should be allowed. The Working Group is currently recommending that they not be allowed. Staff is recommending that they be allowed in what has been called the RT, which is Residential Transition 50-foot height limit area with a Planned Community Zone with specific public benefits that are called out in the Plan which include additional below market rate housing units, other community services, public parking and public open space. Currently the Working Group is recommending that a standard parking ratio be used throughout the area and Staff is recommending a reduced parking ratio throughout the area. Currently the Working Group is recommending office limitations on the ground floor along Homer and Emerson and then certain office limitations south of Homer for general business office, not for medical or professional, but for general business office. As we were going over those recommendations at your last hearing you did ask for an economic analysis to be completed to be in line with what the City Council had recommended in their Page 1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 policy direction about four or five years ago. So we have hired Bay Area Economics (BAE) to complete that economic analysis. They are here and are prepared to give their recommendations to you tonight. They did prepare a report a couple of weeks ago that was forwarded to you. The report was reviewed by the SOFA 2 Working Group and they had a lot of very specific comments on both the methodology that was used as well as some of the conclusions that were drawn. They asked that BAE be available to respond to those comments at this meeting tonight. So what you will see as part of BAE’s recommendation and report is their response to those comments. The BAE report was based on prototypes that were developed based on.the Working Group’s recommendation of 1.15 FAR on a prototypical small lot, which was about 10,500 square feet in size and a larger lot, which was about 26,000 square feet in size. Those prototypes were also included in your packet and can be discussed tonight. There were some changes to the prototypes based again on the Working Group review of them last Thursday night. Alison Kendall from Freedman Tung & Bottomley is here to go over some of those changes to the prototypes. Again, they were based on Working Group recommendations of 1.15 FAR on a small and large lot, on a Staff alternative of about 1.5 FAR on a small and large lot and then a comparativelY higher FAR for comparison purposes of up to 2.5 FAR on a small and large lot. What you may have noticed in reviewing your prototypes is that the 2.5 FAR could actually not be comfortably fit physically on to a small site. So what the analysis actually shows is about a 2.1 FAR on the smaller sites. If you really do try to put 2.5 FAR on the small sites they are very crowded and you cannot get the standard parking allocation on that site. One of the Working Group comments had been that that is therefore an unrealistic analysis and that we should be trying to put the full FAR on both the small and large site, however, we still believe it is a realistic analysis because quite often on many sites throughout the City maximum FAR is not achieved because of other site development requirements notably parking and open space requirements. So we don’t think it is unrealistic to assume that you could not get the full FAR on a site and that it would be something slightly less. So with that I will conclude the Staff Report and ask BAE to summarize their findings and methodology. Then also if you would like Alison Kendall to just go over some of the changes to the prototypes from what you saw in your study session about a month ago to what is being talked about tonight she is available to do that as well. So I would like to introduce Matt Kowta and Alexander Quinn from BAE. I believe Matt will be making the presentation. I believe you have already met Alison and she is available as well. Chair Burt: Thank you. Ms. Grote: I am sorry, I think there has been a slight change in that Alison will go first to cover those minor prototype changes and then Matt will present the economic analysis which is based on Alison’s prototypes. Ms. Alison Kendall, Consultant Planner: I think we felt it would be easier to start from the physical design of the prototypes so that you understand what was being modeled. If you refer to the handout in front of you, Commissioners, and there are copies at the back for the members of the public you can see that we have developed a series of prototypes for the different size sites Page 2 1 that correspond to the different FAR recommendations of the Working Group, the Staff and then 2 a kind of hypothetical above 2.0 FAR scenario, which as Lisa mentioned was really constrained 3 in some substantial ways by the parking and just by the sort of comfortable scale on the site. So 4 we did not set out to do necessarily 2.5 but we did find that somewhere above 2.0 we started to 5 run into constraints in terms of both scale and realistic parking scenarios. 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3O 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 46 The 1.15 FAR scenario the Working Group proposes is the first one in your packet. What I want to point out is that the prototypes are really intended to help us in our discussion of some very ¯ critical questions. One that we addressed early with the Working Group is are we creating inadvertently some critical constraints to creating housing in this area by the way the De’~elopment Standards are formulated and does the Working Group affirmatively believe that is the right development standard or is that an inadvertent effect. So we did some fine tuning earlier in this process, earlier in the year, working with them and showing them the effect of Certain setbacks and so on. So they have already been revised to sort of reflect some of those. One of those critical constraints of course is always the lot configuration and that in particular in relationship to how parking is accommodated on this site. The third one is always the floor area ratio limit. That in combination with the limit on the unit size winds up driving the design in a very substantial way in concert with parking. So that is something to start out with as an understanding. The purpose of looking at these drawings I think is for the Working Group and Planning Commission to really critically think about the issue of the desirable character for a housing development in this area. I think from that point of view it is really helpful to look at the section drawings and look at the [exometrics] and imagine yourself walking past these buildings and imagine them being next to existing buildings in the area. So that I think is particularly important. One of the interesting things that we ran into in that is the fact that there are really very few large sites, there are really a lot of small sites and the character of much of this development would be generally in the two to three story range that is currently found in the area with some limited four story potential if we were to look at higher densities. Lastly I wanted to point out that tkis exercise in trying to assess the maximum capacity of the site was very useful and tended to result in this result of somewhere between 2.0 and 2.5 in the case of the large site it is easier to accommodate more and they came to 2.25 as a desirable maximum capacity. That resulted for example in a four story in the center portion of the site and a three story along the two edges of the site, which is in line with some. existing development in the area particularly along Alma Street where this site is located. Last of all I just wanted to note that the economic feasibility of the projects was the focus of the most recent discussion. And that in terms of the physical constraints there are a few things to be aware of on that front. One is that costs do not increase in a strictly lineal way as you increase the density on the site. With townhouses you have less circulation, less cost associated with elevators and other kinds of amenities. As you increase to flats and other kinds of mixed-use development your costs go up significantly. So there is quite a range in that sense. Even more importantly, in terms of parking solutions you have tremendous variations between and at grade surface parking lot accessed offthe alley moving up to parking that is half below the grade in a sort of podium structure and increasing again with parldng at one level below and even more with parking at two levels below the site. Those again are not linear functions. After you get to Page 3 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 a certain number of spaces you suddenly have to increase the allowance for the parking costs dramatically. So that is a difficult thing to model and I think as a result of that it is not very easy to model such a huge range of different sites. Given that, I think we do have some insights, which the BAE scenario can give you. In terms of the physical design what I want to point out is that the actual appearance of 1.15 and a 1.5 scenario for example on a small lot is very similar. We have two-story towntlouses, they are a little bit more densely packed with a 1.5 FAR scenario and the effective density on the site is 40 units per acre instead of 30 units per acre but you really would not perceive the difference, I think, from the street. You would basically still be seeing the same kind of townhouse Unit with a front lot. So that is something to be aware of in terms of there are certain ways in which increases in FAR do not necessarily translate into height increases even, in this case. As you move up to 2.1, which is the density that is illustrated on the high intensity small lot scenario, you do see a transition to three story development with the ground floor being a flat. That ground floor flat is actually at grade level so again the increase in height is about half a story, it is not dramatically more than you would see probably with the other scenario. So there seems to be very little need to go all the way to a 50-foot height limit on a small lot. The real constraint here is floor area ratio and related to that the parking requirement. The parking scenarios are spelled out in terms of the low parking requirement and the high parking requirement on the little charts below but what you will see is there is quite a dramatic increase in the number of spaces required and sometimes that drives you to a very expensive parking solution as you get to the higher intensities. On the large lot, stepping through it quickly, what is interesting in this one is that the 1.15 would actually result in something like.a two-story development at the edge of the site, three story in the center of the site, but predominantly two story potentially. So it is a very low intensity and very compatible with even some of the single-family residential development nearby. This would include a scenario for mixed-use development, which may or may not be the developer’s desire in terms of maximum return but the retail in this scheme is oriented toward Homer Avenue to reinforce the corridor there. As you step up to 1.5 you get into a combination, which is basically three stories and the final high intensity residential scenario again as I mentioned is three stories on the corner and four stories in the center of the site. We did feel that four stories across the site would seem to be too intense and that having some three-story element was desirable to make the transition to adjacent development, which in this case is actually single story. So hopefully that gives you some orientation to this part of the analysis. We did do some refinements to it to reflect the various comments made by the Working Group in terms of circulation, percentages and so on. Those have been built into the BAE analysis that they will be sharing with you tonight. If there are any questions I’ll be happy to answer them. Chair Burt: Thank you, Alison. We have the representatives from BAE. Mr. Matt Kowta, Bay Area Economics (BAE), Davis: Good evening. I am a principal of the firm and have been with the finn for about ten or 11 years now. During that time I have actually had the pleasure of working a few different projects right here in the City of Palo Alto as well as Page 4 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 46 elsewhere in the Bay Area and Northern California and the western US conducting economic analysis on a whole range of topics. This analysis, as Lisa and Alison explained, was to test the feasibility of some of these development concepts that are possible within the range of options being considered for this update of the zoning requirements. As the previous speakers have also stated although we were only able to pick a certain number of alternatives to model we think what we have modeled is a pretty good range of alternatives that represent conditions that could occur within this area but realizing that there is no way to set out a set of examples that represent every possible situation one might encounter. So let me see ifI can make this work and quickly run you through the different alternatives that we looked at. I’ll talk a little bit about the methodology first. As we said, we need to define what the alternatives were that we were going to analyze. This is just conceptually getting together with Staff and also Alison. Prepare the development specifications for each alternative. So Freedman Tung & Bottomley going through this exercise of drawing the drawing and looking at what fits on the sites was able to provide specifications for how many square feet of commercial space or how many square feet of residential space was there, the number of residential units, what type of parking is necessary in order to achieve the different parking requirements. So we had a whole set of specifications which we can then model financially. We need to estimate what the development costs are, we need to estimate what the potential developer revenues are from either the sale or leasing of those completed products and then we are estimating the residual land values in this case. That is to make an estimate of the price that a developer could afford to pay in order to complete this project achieving a reasonable profit for the land that they would need to acquire in order to complete that project. Knowing that the SOFA area is in fact almost built out there aren’t that many nice clean vacant pieces of land out there, we need to acknowledge that this is really more about a redevelopment process sort of a slow transition of uses from the current uses that are there potentially to different uses or more intensive uses of those sites. So we needed to ask ourselves what would it take in order to make it financially attractive for property owners and developers to consider redeveloping to these different scenarios given that in most cases there is some economic value to the sites that they have above and beyond just a raw land value. So it was necessary for us to consider that in our analysis and I will talk a little bit about how we approached that next. We needed to define these different prototypes. One of them was the small site prototype where we assumed there was about 10,000 square feet of site area, 10,500, 10,000 square foot auto service building. This is loosely modeled after an existing property within the area. That existing building generates an economic value in terms of the ability for somebody to use it for their business or alternatively to lease it to somebody else for their use so we wanted to factor in the value that comes with that type of an existing development. We looked at another site, which was a large site, which involved taking a small site and then assuming it was combinable with an adjacent site. In this case publicly owned lands with improvements costing approximately $1.0 million to relocate. We looked at .those two sites to estimate what the existing economic value was and whether there would be enough incentive based on the amount of money that a developer could pay for the site in order to bring that redevelopment around. Now, we had prototypes for both the small and large site as Lisa and Alison mentioned we had the different density levels of 1.15, 1.5 FAR, in the case of the small site we were able to develop a prototype for 2.1 FAR and the large site with a little bit more space, a little bit more flexibility for design, Page 5 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 46 Freedman Tung & Bottomley was able to come up with a 2.25 floor area ratio. We also had variations that included the standard parking requirements and then the reduced parking variations. Theoretically, when you reduce the parking costs you allow a cost savings that should make development more feasible as long as you don’t reduce the parking so much that we begin to get extremely reduced values for the finished product. As we mentioned, last week we presented our analysis to the Working Group and I want to just quickly tell you a little bit about what we shared with them to recap that. For the small site we felt that there was adequate redevelopment incentive at approximately 1.5 FAR with either standard or reduced parking. That above that there would actually be an increased incentive for redevelopment particularly in the case where you allowed the reduced parking at the higher densities. For the large site what we found was there was a redevelopment again based on those assumptions about the particulars of that large site that the incentive would be achieved at about 1.15 FAR with either the standard or the reduced parking. Again, the redevelopment incentive generally increasing as the density level allowable increases. Also what I think we observed in that exercise With the incentive value of the parking reduction tends to increase as the density and hence the cost of parking construction increases. What we have in front of you, I believe you were given a set of matrix that outlines some of the comments that the Sedway Group made on behalf of one of your local property owners and developers. Again, as Lisa mentioned the Working Group asked us to go ahead and look at those comments, take them into consideration to decide if there was some changes that were warranted and to look at how the analysis changed. I don’t have a slide on the overhead but for folks out in the audience the summary sheet that outlines those issues raised in the Sedway letter and then the changes we made is available in the back. If you will refer first to the one that has the boxes on it and the top is labeled, "Summary of Responses to Sedway Group Comment Letter," I’d like to talk about that first. Chair Burt: I don’t know if we have that. Mr. Kowta: Can we get some copies? Alexander is going to bring them forward. Sorry about that. Generally the tone of the Sedway comment letter was that we should have assumed higher costs to develop the projects within the study area. In particular they analyzed the high-density alternative on the large site and made some specific comments with regard to that and then said that generally they felt that those same kind of issues would apply to the other alternatives. So we will kind of walk through what the high points of that are assuming you are interested in all of that. Again, they had indicated that they felt that we should have attempted to model that highest density as close to 2.5 FAR as possible. I don’t think I need to get into the details of why we couldn’t get all the way to 2.5. I think Alison addressed that pretty well but suffice to say that in doing some refinement we Were able to bring our prototypes up a little bit higher. So we have 2.1 FAR on the small site and we have 2.25 FAR on the large site. Building circulation space is the common area dedicated to circulation, in other words foot traffic within your building that is not necessarily leasable or sellable to one of your ultimate tenants. Sedway Page 6 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 suggested in the higher density alternatives where we have the stacked flats that they would prefer to see us allow for 10% to 20% circulation space in that design. We had Freedman Tung & Bottomley take a look at that, they made some adjustments to the circulation areas we also allowed for some additional costs in exterior circulation. So in essence I am saying that we responded to that, we have incorporated some slightly higher circulation costs into our analysis so that is reflected in the results I’ll talk about in just a few minutes. Construction costs for elevators, here again we took another look at it with Freedman Tung & Bottomley. There are some alternatives as indicated in this matrix where we did add some additional costs for elevators based on the revised specifications that FTB provided us with. So we have that covered now. Developer soft costs, these are costs that are not sticks and bricks, as they say, the actually hammering of nails and purchasing wood and that sort of thing but are developer overhead, legal costs and so forth that can add to the actual cost of constructing your project. Again, Sedway suggested that they should be higher than what we had assumed. On reflecting on that we have made some slight adjustments as indicated here, an additional three percent cost, to allow for some of those costs that we did not specifically call out in the first analysis. So that is reflected across the board in the revised analysis. The developer interest carry is the interest that would be required in order to get a developer interested in putting up their money to build the project and hold it until the time that they can sell it and cash out of the project. Sedway is suggesting that in addition to the developer profit levels that we calculate on a gross basis for the project that there should be some additional developer equity interest carry for the project. In our view that is not necessary, that the overall profit levels that we have factored in would allow for the payment or the compensation for that equity investment. It is a concept that we might try to model more specifically if we were doing a discounted cash flow analysis where we are really trying to track over time how long somebody has their money out there and what the return is when you factor in the fact that it does take you some time to develop a project. In this case, it is a static pro forma we are looking at it as kind of a snapshot in time. We have standards in there for profitability that have been based on conversations with developers and bankers that are active in the area. So I think they are reasonable for the purposes of this analysis. That goes back to the final point, which was that Sedway was arguing for a higher developer profit rate. Again, we think that the figure that we have here is within the ballpark of reasonability. I will go now to what the actual results are. Taking into consideration the comments of the Working Group, the Sedway letter, direction from the Staff. I need to go back, one thing I didn’t mention is on the BMR affordable housing requirements. The.letter pointed out that there is a consideration being made to increasing the below market rate housing requirement from 10% to 15%. Staff direction was to go ahead and factor that into the model as if that will occur. So I think we have that in there now. We have also been directed that there is a new method of calculating what the in lieu fee is if a developer doesn’t actually provide the inclusionary units within their projects. So that represents a cost increase as well and that is factored into the analysis now. Having said all that, the results. On the small site what we found, and now you can switch to that first summary sheet that has the shaded area to the right. When we compare the residual land values to the targeted redeve!opment incentive values that we established for the small site none of the alternative achieve that targeted redevelopment threshold, although, at the 2.1 floor area ratio with the reduced parking we are within about one percent of that threshold. Based on Page 7 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35. 36 37 38 39 40 41 42 43 44 45 46 1 being realistic about the precision of this sort of analysis we are basically saying that that 2 alternative under this set of circumstances creates a pretty decent incentive for redevelopment. 3 On the large site we are estimating that there is adequate redevelopment incentive for 4 development down to 1.15 FAR with standard parking, however, we need to acknowledge that 5 that is kind of a unique situation. In this case that redevelopment threshold is based on the City 6 owned property being compensated at a level adequate to relocate the existing public 7 improvements, in this case an electrical substation type equipment, and provide a limited 10% 8 premium if you will for the trouble of going through that. We don’t see that there is an 9 additional value in that site that is adequate to give the City say closer to a market rate of return 10 for the land itself until we get to the alternatives around 1.5 FAR with reduced parking. That is where we ended up with this analysis. I would like to say that I think that what you see here is starting out as something that is relatively conservative in terms of development feasibility. On that small site we modeled the site that actually has a very high FAR to start with, it is not quite 1.0 but it is close to it. It has a. good economic use that we assigned a considerable value to so in that case we are setting a pretty high standard for what it would take to spur redevelopment. There are other situations out there perhaps where we have much more functional obsolescence of the building that it would take less of an incentive in order to achieve the redevelopment. On the large site this is one where we have at again that 1.1 FAR level we are saying it meets the feasibility threshold. That is kind of a unique circumstance as well, perhaps a little bit on the low side. You might think more along the lines of the 1.5 FAR with the reduced parkingas being where you would really maybe have something representative of situations that private land owners might be looking at in that area. It is just important to realize that all of these situations are unique. Everybody has a different set of constraints and circumstances that affect that decision-making process. Keeping all that in mind, again, I think that the analysis that we have done has some pretty significant assumptions in terms of the actual cost of developing. There is probably room for people to get creative and figure out less expensive ways of development and maybe find ways to make some of these projects work that wouldn’t necessarily work if you followed all the assumptions of this analysis specifically. At the same time there are circumstances where somebody could say well, my site is special I can’t possibly do these things and get feasibility even at these levels that you have analyzed. For the small site, as the density increases the profitability is declining relative to the large site at a comparable density. I think what we are observing there is that on the small site you just have much less flexibility to configure the project in the most optimal way in order to really make it efficient and profitable to develop. As the floor area ratio increases, again, that parking standard reduction becomes more valuable. What you are seeing is that as you get the higher floor area ratio you move from the less expensive parking types that are partially above ground to the fully submerged underground parking which is much more expensive to build. So every time you give a reduction to that you are creating a pretty nice economic incentive to help make redevelopment or development more attractive. That is in a nutshell what we were able to learn from this analysis. I think it is telling us that generally as you increase the FAR level you are creating more incentive for redevelopment but at the same time there are these physical constraints and other development standard constraints Page 8 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 that might say it is very difficult really get much higher than that 2.0 or 2.25 level on these sites with a reasonable mass of a building there. So if there are any questions I will be happy to answer them now. I do expect that we will have some comments that may raise additional issues so I am more than happy to come back later if you have additional questions to ask me after you have heard some other testimony. Chair Burt: Michael. Commissioner Griffin: I am wondering if you could elaborate on this slide the second paragraph where it says, "added flexibility for small sites will be a useful redevelopment incentive." Mr. Kowta: Sure. What I mean by that is that on the small sites they are much more difficult to configure because there is just less room to work with. You have things particularly in the area of parking efficiency where you need ideally a certain dimension of site so that you can lay that out in a way that you are making the most use of it. As the site gets smaller it becomes more difficult to do that, the same thing with the design of the building itself. So when you consider how these regulations might turn out you might give some consideration to recognizing that the smaller sites, in order to really encourage and facilitate that development, may need some additional consideration to flexibility as opposed to a site that is much larger and regularly shaped. In a way this is not a whole’lot different than the concept of a variance for somebody who has an odd size lot and needs to have a variance to their setback or what have you in order to put say a reasonable single-family house on it. Commissioner Griffin: So your idea of flexibility revolves around parking primarily? Mr. Kowta: I think it is parldng that is one of the easier things to point at. I think that in addition we are dealing with some pretty small sites that it would extend to other physical development standards. Commissidner Griffin: The reason that I am getting at this in such detail is that we are told that there is a danger that these sites are not going to be redeveloped because they are predominantly small in size and present some pretty snaky problems. : We can use all the help we can get and advice from your good self. Mr. Kowta: Did I answer your question adequately? Commissioner Griffin: No, but I am willing to let it go for the moment. Mr. Kowta: Okay, I will be happy to come back. Chair Burt: I have. a couple of questions. One on what is called the large site, which is envisioning combining the substation property at essentially free land except for the $1.0 million cost of moving the substation, approximately how much would this pro forma change if that were a fair market value on the land? Page 9 1 .2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3o 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 46 Mr. Kowta: The fair market value for that land is difficult to say but I think if we go back here to the large site results, the second part of that paragraph would indicate that the alternatives were the 1.5 and 2.25 FARs and reduced parking would allow the City of Palo Alto to pay for the substation relocation, the $1.1 million, and realize land values of about $100 per square foot if you are down closer to the 1.5. I think we calculated as reflected on that ;ummary sheet that you could probably get up to about $200 per square foot if you were fight there at 2.25 and also have the benefit of that parking reduction. So I think that’s the point where I said that I thought that may be a little more typical reflection of how a private property Owner might be looking at that large site development situation. Chair Burt: My second question is that when we have looked at alternatives we look at existing zoning and existing use as a baseline, correct? Mr. Kowta; Right. Chair Burt: Then we jump up to a redevelopment of a 1.15 FAR, various parking arrangements and on upward from there. What we have had in this district is another alternative of redevelopment and that has been, I will use the example of Ellison’s Auto where we took one use of an automotive repair use and they converted it to office, as I understand it took a loft area and were legally allOwed to convert that to essentially a second story office interior and were grandfathered in with no parking requirements. One, if that is a correct assumption I would like to understand how that economic alternative would be compared to some 0fthese others and is basically are we potentially going to create a circumstance where what might be a very undesired redevelopment alternative becomes the most economical one put forward. Mr. Kowta: I think that the potential to do one of these adaptive reuses that allows somebody with relatively minimal investment to upgrade the property and essentially open it up to a whole different type of tenant class, a whole different rent structure and so forth, would create a situation where maybe the modeling that we did on the small site alternative which said that instead of trying to do an adaptive reuse with that existing auto service structure they take it down entirely and start over that there may be this sort of intermediate step which is to renovate it and figure out some way to achieve a higher rent based on that existing building. YOU would have to do the math. I can’t do it on the fly here but I could envision a situation where with a relatively small investment you get a significant return andsomebody says that is more attractive to me than to go this other step and tear it down and start over. Chair Burt: And then we are left with a parking deficit and perhaps an even greater intensification of the use at the same time and harm to the jobs/housing imbalance and yet maybe that is one of the alternatives that we are creating as a good economic viability. Lisa or Steve, do you have any thoughts or comments on that scenario because it is one that troubles me? Ms. Grote: When that particular site redeveloped that is under the existing ordinance, which is the CDS and that use was actually classified as business service rather than office. Business service has the same parking requirement as the vacated automotive use had. So in terms of definitions under the Zoning Ordinance the parking need did not get bigger and therefore whatever deficit was there did not become greater. So it was classified as a business service use Page lO 1 2 3 4 5 6 .7 8 9 10 11 12 13 .14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 -31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 46 rather than an office use, which is how it was allowed to make that conversion. That is what limits currently a lot of the conversions of existing buildings is that if the use intensifies and you need more parking typically the parking cannot be provided on the site and so that limits what can go into that building as an adaptive reuse. So it makes a lot of difference as to what is being proposed as to whether or not they can obtain approval for that. Chair Burt: So current regulations would restrict an adaptive reuse, which would be a change of use that might require greater parking? Ms. Grote: That’s correct because very few of the sites have the ability to provide more parking. Some of them do and there are some examples of that but most of them do not. Chair Burt: Over the last few years we had various sites in the SOFA 2 area that had this sort of adaptive reuse, some went from one form of office to another but others went from what I perceived to be lower density lower intensification uses to higher ones without being required to put in parking. What is the reality there? Ms. Grote: Sometimes that is because with the Ellison’s example the use was classified as a business service rather than an office. Sometimes that is fine line as to what the distinction is but for that particular one it is because there was a lot of prototype development occurring, there is a lot of large open work space rather than the typical office cubicles, at least as it was described when it was coming in and going through its review process. Sometimes in a couple of cases the site actually could provide the additional parking. Sometimes that meant just a couple of spaces but that is what was needed for that incremental difference. I can think of two that did that. Then I would have to look at the specifics of others. So it has to do with use definitions and then also the ability to provide that parking on site. Chair Burt: Michael. Commissioner Griffin: So just to make sure we have got this now, on the large site results you are saying that 1.15 worked but thanks to a low valued City parcel being included in the analysis. If you went to, pardon me but, more of a real-world scenario with a privately held parcel the FARs that work then go to 1.5 with reduced and 2.25 FAR with standard. Am I putting words in your mouth there? Mr. Kowta: Yes, actually the 2.25 scenario that we modeled under the reduced parking gives you that higher level of return, allows you to pay more for the land, the standard parking would be below I think what is probably a real-world scenario. Commissioner Griffin: You are saying 1.15 and 2.25. I don’t know, will the real number stand ’up which one is it? Mr. Kowta: Right. The alternatives that have the 1.5 and 2.25 FAR with reduced parking I think are the ones that give you that increased value that you can attribute to the land itself once it has been cleared. If we go back to the summary sheet the 2.5 FAR with the standard parking generates a residual land value which is about $147 per square foot and that is just marginally Page11 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 above that initial target that we set saying all we are trying to do is compensate the City for the cost of relocating the substation. So again you can see here when you are at that high density level the impact of a reduced parking requirement is pretty substantial in affecting the overall attractiveness of the redevelopment. ; Chair Burt: Karen. Commissioner Holman: Over what period of time did sales happen that you considered for determination of land value and over what geographic area and did you break that out by what uses where there that determined the land value? Mr. Kowta: Again, wedidn’t actually try to determine what the land value is, just a raw land value, because we felt that wasn’t really a representative situation within this area. Anecdotally we are being told over the last several months that somewhere around $100 to $150 per square foot might represent kind of a vacant land value in this area. Again, the basis for our analysis on that small site was to take a look at the building that was there, to estimate what the net revenue being generated from that building is to capitalize that and convert that into a lump sum value of the building and the land as well. So that is how we ended up with approximately $2.5 million dollar figure for that small site. Then when.we combine that with the adjacent City property for the large site scenario we added in the cost to relocate the substation, provide a slight premium on that, if you will, and said that is theminimum threshold. Again, it would assume that you pay the small site property owner this economic value of his site and that the City really needs to be incentivized by being able to cover the cost of its relocation. When we originally started conceiving of this alternative we thought this might be a situation where the City would say there may be some public benefit to providing this site, that there may be some negotiation over additional affordable housing for example or some other sort of public benefit. So in that case we are looking at some consideration other than pure market value as being a motivator for selling that site. Commissioner Holman: Just as a follow up and I understand what you are saying as far as all of these factors have to be considered as far as encouraging someone to redevelop to a different use, at.the same time the land value is a portion of that. So when you determined roughly you said $110 per square foot, is that based on recent sales over the last several months and is that several months or a couple of years? Mr. Kowta: Yes, I can’t verify any of those specifically. I know that when we did work before we looked more specifically at land sales and those sort of prices were coming up but for this current go round it is just anecdotal. There may be some other folks who want to get up and talk about what they see as the market land value here. Again, the standard that we used is not dependenton a determination of what the land value itself was but rather what the to~tal economic value of that site is so that you could then say, okay, can we get more of a return by redeveloping it than we can by just leaving it the way it is. At that point you can’t separate the building from the land and say I want this much for the building and this much for the land, it all comes as a package together. Again, when we say what is the more realistic scenario on that large site if we assume that we are getting closer to the higher value I think that again we had about $237 per square foot for the small site that has that building improvement on it with an economic value Page 12 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 there. If you are closer to $100 or $150 per square foot that is giving you a pretty good value for that land relative to the value of the building in the other case. So I don’t think it is a bad place to be but I can’t say that it is the number that you would find if you offered that piece of property up in the market. Chair Burt: Just one other quick question. On the various proposals there is 2,500 square feet of office that is used for the assumption. Could you, or perhaps Lisa, refresh me on is what would be allowable under the FAR as proposed? Ms. Grote: What would be allowable under the FAR currently the requirement is either 5,000 square feet of office or 25% of the overall site area whichever is greater. There was concern on the Working Group’s part that that 5,000 square feet on the ground floor was too great and that it should be limited to something smaller which would have a greater likelihood of being. neighborhood serving. So that is why it was reduced to 2,500 square feet. Chair Burr: Are you referring to the retail or the office? Ms. Grote: That is the office portion. So of the .4 that is allowed for commercial purposes, meaning non,residential, the office portion on the ground floor would be limited to 2,500 square feet. That is a portion of that .4. Chair Burt: Okay, great. Thanks. Any other questions before we take a break? Thank you very’ much Matt. That was very informative. We may have one more question. Karenl Commissioner Holman: I am a little concerned because we do need to take a break but at the same time we have members of the public here who have been waiting a long time. It is 9:20 so if we can j ust keep our break really brief or just go ahead and hear the public, one or the other. Chair Burr: I don’t think we want to wait an hour to take a break and have our break at 10:20. We will take our break at this time and then when we reconvene we have so far about a dozen speaker cards with the potential for more. Each speaker will have up to three minutes to speak on the subject, Thank you. We have so far I think a dozen speakers and as everyone can see we are already at 9:30 so we will encourage the speakers, if any of them wish to support statements made by previous speakers please feel free to do so. This is likely to be our last public comment period on the SOFA 2 project plan. Our scheduled follow up meeting for August 21 is not expected to have an open comment period for the public. Our first speaker is Ian Irwin to be followed by David Buberiik. Mr. Ian Irwin, 800 Cowper Street, Palo Alto: I am a member of the Working Group and been involved with the process for the several years that it has been going on for SOFA 1 and SOFA 2. I am here tonight to speak basically in favor of the outcomes of the SOFA2 Working Group, the plan that was put forward. I would like to just touch on a couple of things. The purpose and the charge from the City Council to the SOFA Group was not to create a redevelopment district Page13 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 in SOFA 2. It wasn’t to develop the most economically attractive situation to change the community from what it is. Actually if you read the purpose of the coordinated p.lan it was to really preserve much of what was there and preserve the walkability and the character of the neighborhood. First of all the argument seems to be shifting more to how can we get the existing buildings changed into something else. How can we incent this economically? I want to point out first of all that is not the point. I think the Working Group plan which came up with an FAR of 1.5 was a good one. It is economically feasible, in fact. With respect to the economic analysis if you said something about the stock market a year ago you would have had a certain kind of economic analysis. Clearly these things are transient and temporary. I don’t think anyone .who does one is going to bond it as an accurate outcome. So I think you have to take it with a grain of salt. I think that when the City obtained this from BAE as an independent review it shows that it is certainly possible. I think some of the other information we have seen from the Sedway Group for example, that has added things on there that almost reminds me of some of the accounting one sees. They want first 10% for the developer on the money he is putting on million dollar property so he has about a third of that and then on top of that soft cost he is to et 15% profit on the total. If you just sit down and figure that out we are talking about 50% to 60% profit on a project that turns around in a year or so. I would ask you to consider that in terms of trying to do this. If you make it worthwhile to build new buildings there they will be built, if you simply allow the neighborhood to grow, if you implement it the way the SOFA Plan proposes then What you will see is the evolution of a wonderful neighborhood as it is. That’s all, thank you very much. Chair Burt: Thank you. David Bubenik to be followed by Bob Kuhar. Mr. David Bubenik, 420 Homer Avenue, Palo Alto: Good evening Commissioners. I live just a few blocks away from this area. I have cared about it deeply for much more than the five years that I have lived there. I am also a member of this Working Group and I remember well when this process started two years ago when SOFA 2 was due to start. I like this economic analysis or rather I like the fact that we do have an objective appraisal of all of this finally. I think we could have saved ourselves a lot with this basis for discussion, we would have been much further ahead in this process had we had-this when we started out. Unfortunately it is still not finished. It is like they are in the right pew but the wrong church. They have given some analysis of redevelopment scenarios but their metric is redevelopment incentive, we saw it on the screen there for a long time. Net to Chapter 19.10 of Palo Alto Municipal Code establishing coordinated area plans uses the word incentive no redevelopment is used. It seems to me that this process is consistently, like a car with a bad wheel alignment or maybe a loose [nubby] on the steering wheel, keeps veering into a redevelopment direction. I believe if we want to do a redevelopment here we should stop the SOFA process and start over with an explicit redevelopment process. In the meantime let’s not talk about redevelopment. Let’s talk about economic incentive, economic feasibility. Significantly the SOFA Plan does not define that in its extensive list of definitions in its appendix. We are left to guess what it means. We have one interpretation here, I am sure it wasn’t the authors they were guided toward it. I think it is wrong. This is not a redevelopment incentive area. Possibility should not be evaluated in terms of their redevelopment incentive. They should be evaluated in terms of their economic feasibility. What might that mean? To me it means, in the spirit of the SOFA Plan and the Page 14 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 policy framework that we all received from City Council, that it should not put anybody out of business. It should allow continued use of current uses and it should allow more broadly owners fair use of their property and continued use. Most importantly it should not cause undue expense. For example, let’s get a non-feasible scenario. The Working Group comes up with a plan which says we want to have all nice surface free of cars, no parking anywhere, everybody gets to build with zero parking, but in the meantime the City needs to spend a billion dollars to build underground parking garage in the area to support this. That is my example of economic infeasibility. It has nothing to do with incentivizing redevelopment. It does permit adaptive reuse, reuse or continued enjoyment of the property by the current owner. That is all I have to say as a private citizen. Thanks very much. Chair Burt: Thank you. Bob Kuhar to be followed by JeffMayer. Jeff Mayer to be followed by Tom Harrison. Mr. JeffMayer~ 18642 Via Torino, Irvine: Good evening. I appreciate the opportunity to speak again. I was here at a recent Planning Commission meeting. I represent not only my firm Genzler but US Trust in the Veccielli Family who owns the property at the comer of Alma and Forest. As you may know, I am with a very large architectural firm. We are involved in about $4.0 billion in construction every year and we see all types of development. We have had a lot of very helpful advice from John Lusardi and Steve Emslie and Amy French and others and we have been working hard, as I mentioned last time, to try to develop a project that meets the anticipated objectives of SOFA and the Planning Commission. We are representing a real live situation. We have been working on the design of this property at the comer of Alma and Forest for three years. We are working with a maj or general contractor who has been doing construction cost estimating on our building. We know exactly what it is going to cost to develop the building that we would like to develop within a reasonable framework. I would like to make four comments tonight. First of all to address the costs of construction identified in the BAE study, to address the load factor, the developer’s margin and the feasibility of retail on Alma. First of all I think our biggest concern in your review of the BAE’s study is the cost of construction that they have outlined is significantly lower than our contractor, which is a major contractor in the Bay Area, is anticipating. The primary reason being we have two levels of underground parking required in order to meet the parking requirement. We have a mixed-use building that is not that similar to the FTB prototype because when you integrate non- residential and residential you move to different construction techniques and floor plans that create a lot of complexity and higher costs. We are probably another 70% or 80% higher in construction cost than is being shown by BAE. Second point, we would agree with Sedway’s findings that the cumulative factors are much greater than the BAE report. That makes leasability more difficult in terms of the percentage of usable space. I would argue that the developer profit margin is important because to develop a property you have to have to contingencies for changes in market conditions. Our client has concluded that it is not possible to redevelop a property, which currently does not have a ’ Page 15 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 desirable use, as you know it is a building that has been condemned for seismic reasons in the parking lot, at a 1.5 FAR. Thank you. I would like to say more but I guess I am out of time. Chair Butt: I have a question. I don’t know if you can answer this offthe top of your head or give me a rough notion of the answer. If you were allowed a project with slightly less commercial, say a .25 FAR commercial, but a total of 1.5 FAR what is your sense of the viability of that scenario? Mr. Mayer: That would not work under the construction cost scenarios that we are seeing in this market right now. I can give you numbers if you are interested. Chair Burr: What is your estimation of what would be the threshold? Mr. Mayer: We feel we need to be at a 2.0 FAR but the .4:1 just does not work for us for office. We are quite willing to develop residential but the mix of residential and non-residential in a building really needs to be about 60% non-residential, 40% residential or about a 1.2:1 ratio of non-residential to site area to make the economics work. Chair Burt: Thank you. Karen. We have one more question for you. Commissioner H01man: Can you enlighten me because I believe when you spoke before your. proposal was for a much lower FAR. I was thinking it was about 1.1 or 1.2. IfI recall correctly that is what it was and I am really confused about what has changed. Can you help enlighten me on that? Mr. Mayer: I don’t recall having said that. I hope I didn’t misrepresent in any way but the building has not changed in its design effectively since the last time that I spoke. We are designing right now to 1.94 with anticipation for a PC Zone change application to make it work for us. " Chair Burt: Phyllis, you have a question also? Commissioner Cassel: Yes, you were going to say something about retail on Alma. Mr. Mayer: Yes. I wanted to say something briefly about that but it was corroborated.by BAE the issue of shortage of street parking on Alma. It does make it difficult and there is a concern there. Also the lack of critical mass of other adjacent retailers in the area and while we are parking our own building within the guidelines there is no opportunity for surface level parking. All parking has to be underground which is not really feasible for retail. Chair Burt: Thank you..Tom Harrison to’be followed by Wayne Swan. Mr. Tom Harrison, 230 Homer Avenue, Palo Alto: I am a member of SOFA 2. I guess I am talking for the small, small lot holder of 5,000 square feet. I am here to urge you to be as flexible as possible for business. What I am afraid is that we will become a redevelopment area. I think if you make it difficult and this seems difficult to me. When you say we are going to have so Page 16 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 much retail so much of this and so much of that for commercial space that what we are gong to do is we are going to switch over and the developers that you are thinking about are going to disappear and a new set of developers are going to arrive and they are going to put housing and this entire area will be high density housing, which I know that a lot people would like to see. But the community would really like to see small business stay and to do that we have to have flexible ability to rent to whoever we wantl Believe me, office space might be hot for a while but it won’t remain hot. There will be other things come and go over the period of time, long term. If you want to keep small lots as we have now you will have to allow flexibility. Otherwise we will sell to each other or we will sell out to a developer and you will have large lots for large projects and large buildings. So please be as flexible as possible. Thank you very much. Chair Burr: Tom, I have a question. Is there language in the proposed plan that does not meet your flexibility aspiration? Mr. Harrison: The proposal that you have to have retail. I just think you can be a commercial building and rent to anybody, you want except obviously we don’t want massage parlors and things like that. I think that you will find that you will get a mix of businesses. As soon as you micromanage it what happens is a landlords need to make money like anybody else, my building is for my retirement and ifI have a situation where I can’t depend on my building I have to sell it. I am retired now and I need the money obviously to live. The other people around me who are small business owners or small landholders basically are in the same positions. I don’t want to see the neighborhood change. Maybe I am a little bit more conservative than some people but I don’t want it to go to high-density housing. I don’t want it to become three story high apartment houses and townhouses. Chair Burt: So the aspect of the plan that you are referring to is where if you converted from a current non-conforming use to a conforming use, if you converted from your present office to retail, you would not be allowed to then convert back to the non-confirming office. Mr. Harrison: Right, and I would like to see for people who want to develop commercial done on the bottom and residential done on the top. If my building would lend itself to that I wouldn’t be averse at all to putting housing above mine. We are always going to have a parldng problem. That is just the way it is and merchants can live with that. Thank you. Chair Burt: Thank you. Wayne Swan to be followed by Elaine Meyer. Mr. Wayne Swan, 240 Kellogg Avenue, Palo Alto: Good evening. I live south of Embarcadero a short way but I am kind of related to the South of Forest Avenue too. I noted the Staff Report presents the fact that the undercrossing at Homer is about to happen. I remember being here with the City Council recommending the undercrossing at Homer a long time ago to get to the clinic. There are a couple of other traffic issues that might not be covered to my knowledge anyway in the SOFA 2 Plan. One is the need for a traffic signal at Channing and Alma so that people making left turns don’t block Alma Street traffic. The other issue is the one-way traffic on High Street if it is going to be continued the one-way pattern will work and if it is going to be changed why I don’t know whether it will work or not. The information I read in the Staff Report brings Page 17 1 a big issue that you are talking about, the Planned Community District, up and I think that needs 2 ¯ to be resolved. That is the heart of most of the problems of planning in Palo Alto. Spot zoning 3 for a small lot areas, they go under a planned community development district and make a deal to 4 suit their own property. I think one of the biggest problems of planned communities is that the 5 lots are too small. In San Mateo Woodlake was a planned community development. In Palo 6 Alto Oak Creek Apartment development was a planned community type of development. When 7 you get down below 2.5 acres it isn’t much of a community anymore. So maybe there is a ¯ 8 possibility if planned communities are permitted, and the Working Group recommends against it 9 and I think that is wise, thenit shouldbe 110,000 square foot lot minimum. If it is larger than 10 that a planned community can be developed. Thank you. 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 Chair Burt: Thank you. Our next speaker is Elaine Meyer to be followed by Earl Schmidt. Ms. Elaine Meyer, 609 Kingsley Avenue, Palo Alto: Good evening Mr. Chairman and Members of the Commission. I am a member of the Working Group and President of University South. Listening to some of the earlier speakers I was reminded of the saying that to a hammer everything looks like a nail. In this case, to a developer everything looks like a redevelopment area. SOFA is not a redevelopment area. It is not blighted and our charge in the Working Group was not to redevelop but rather to allow a gradual compatible eclectic development to occur over an extended period of time, maybe five or ten years or longer. It is a really bad idea, it seems to me, to create financial incentives for property owners to demolish or enlarge or sell, which is what happens when you allow higher FARs and heights. The Working Group recommended an FAR of 1.15. The Staff recommended an FAR of 1.5. It seems to me that the proper area for your discussions should be within those two parameters. They are both economically feasible in a large variety of circumstances. Not a day passes that we don’t read. in the paper about citizens who object to large developments. I read recently about Los Altos citizens who are upset about their City Council plans for a new Town Hall. One spokesman said people want half the cost and half the size. A neighborhood in Los Altos is petitioning for a single story overlay. In Mountain View neighbors are objecting to the Home Depot development. In Menlo Park Lynfield Oaks is upset about large developments being proposed. In our own town people who live near Edgewood Plaza are very upset about large development. People who live near East Meadow are very upset about Hyatt development. Only last week the Mayor mentioned that 13 neighborhoods in Palo Alto have.applied for single story overlays. Even the upgrading of the library they are citizens in Palo Alto who are objecting to the plans as too big, too expensive over-development. So SOFA isn’t a NIMBY situation we are reflecting a national trend. In fact in New York the plans suggest for Ground Zero a lot of the citizens of New York were saying they are too big. People have seen the results of runaway over-development and they have become sensitized to it. As far as SOFA 2 is concerned, it is not our charge nor is it desirable to convert every possible site to housing. The neighborhood has a mix of uses and that’s the way it should remain for the health of the neighborhood. Thank you. Chair Burt: Thank you. Earl Schmidt to be followed by Mary Smitheram-Sheldon. Page 18 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16. 17 18 19 20 .21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 46 Mr. Earl F. Schmidt, 201 Homer Avenue, Palo Alto: We live at Homer and Emerson in a property that has been in the Cassel and Schmidt families ever since the turn of the century. We are very proud of our property, several of them. There are five that are adjacent to that corner all have been well maintained by family members ever since they were built. The proposed SOFA Coordinated Area Plan fails to create incentives for housing and it is punitive to existing businesses and property owners. The zoning plus approach could have created carats in the existing CDS District to encourage additional housing, retail and adequate parking. This area is a classic mixed-use neighborhood, which the market is constantly redefining. Some properties are appropriate for one use and not another. Members of the Working Group, with the exception who moved out in order to rent his building and be able to retire, who voted for the SOFA recommendation where exclusively non-property owners within the SOFA 2 area as it is comprised today. There is not One active member of that group that is a resident of the area. This is not the consensus necessary to impose such wholesale rezoning in an economically important area of the town. We are long past the mania of the dot.com boom and we need to address the specific plan in the context of a more historic economic environment. Our family owns five properties adjacent to the corner of Homer and Emerson. One is residential, four are commercial and have been since 1900 to the 1920s. All are potentially historic. We do not see any evidence of consideration of historic properties within this plan. Thank you. If this sounds familiar you’ll some of my words exactly in Chop Keenan’s letter to you and the Council. Thank you. Chair Burt: Thank you. Mary Smitheram-Sheldon to be followed by Curt Peterson. Ms. Mary_ Smitheram-Sheldon, Sedway Group, San Francisco: Good evening. I am a Managing Director with Sedway Group. We are a San Francisco based urban economics and real estate consultants firm. Our .firm has been privileged to work for cities such as Palo Alto, San Jose, San Francisco, Redwood City, San Mateo as well as the private sector including lenders, corporations, property owners and developers. I was retained by Ross Construction to review the land residual analysis contained in the BAE economic feasibility study. I had an opportunity to present some issues and concerns at the July 25th Working Group meeting. I am pleased that they incorporated a number of the items that were brought up by both the Working Group members and in a letter that I had an opportunity to submit at that meeting. However, the revised analysis does exclude a number of items that still overstate feasibility. Of particular interest the concept of developer equity interest carry. There are a number of ways that that can be conceptualized. Essentially the developer equity is the difference between project ~ost and the amount of the construction loan that the developer might get from a bank such as Wells Fargo. There are a number of ways where the developer can get that money. The developer can get what is called a mezzanine loan, which is like a second loan. The developer can obtain a partner, an equity partner, in the deal or the developer can pull that money from an alternative investment. Another way to do is to have the landowner enter into a joint venture on the development where the landowner receives a preferred return. At any rate, no matter how this is. conceptualized there is a real cost to that money. In fact I have an article with me written by a gentleman, Marcus & Millichap, that deals with capital markets and he indicates that interest rates on mezzanine financing range from about 12% to 16%. So it is a very real cost that should be factored into a development pro forma such as those included in the BAE analysis. Page 19 1 2 3 4 5 6 7 8 9 10 11 There is also the issue with respect to developer profit. Lenders like to see a minimum level of 15% hopefully greater profit level in a developer’s pro formabecause that provides additional cushion for the lender. The last thing that the lenders want and especially they learned their lesson from the S&L debacle in the 1980s about being very strict in their underwriting criteria and looking at potential loans and particularly construction loans very carefully. Thank you. Chair Burt: Thank you. Curt Peterson to be followed by Doug Ross. Mr. Curt Peterson, 909 Alma Street, Palo Alto: I am a member of the Palo Alto High Street Partners. Again the question that we always keep coming back to is does Palo Alto really want housing? If we want housing it has to be economically feasible and we have had a lot of 12 discussion about it. BAE has done an excellent job on their initial analysis and they made some 13 changes today that cover a lot of the other items. The program that we have here is one that 14 includes all the costs for development in a format that is more typically used to obtain project 15 financing. So it includes the land, it is not a residual analysis it includes all the costs that are 16 associated to develop a project. We based the lot size on the same size as the large lot for the 17 BAE analysis and we used a 2.0 FAR to start with. The circulation that we have determined for 18 a 2.0 FAR project is more realistically about 15% and I think that is about where we are now 19 with the Freedman Tung & Bottomley issues rather than the 4.5 used in previous analysis. The 20 circulation, when you deduct the circulation you have 35 units averaging 1,473 feet. Now what 21 we have done is we have included the land cost. We talked about what the real land cost is or 22 land value today. The City of Palo Alto Housing Element page 81 there is a sheet in there that 23 talks about land values being between $150 to $167 and that is reasonable in terms of some 24 recent appraised values of sold property so we used the midpoint thereof. We used the same 25 A&E percentage and permit and City fees that BAE did. Construction cost is identical except we 26 assumed all underground parking which I believe is probably where we are on.a 2.0 FAR 27 alternative now from Freedman Tung & Bottomley. The property tax was not included before 28 and it is now. Insurance cost was not included before and the insurance cost is identical to what 29 BAE had, legal and accounting fees, models and management administration were.not in the 30 original number. They are there now and they may be in the new numbers. The contingency 31 percentage is the same, five percent. Loan fees and interest expense were calculated the same 32 way BAE did however there is on~ significant item and this relates to the mezzanine financing. 33 There are two ways to do it. One is to borrow more money from the bank. There is going to be 34 some equity in a project always. Our equity in this case is essentially the land amount, $4.0 35 million. That earns nothing except for what the project earns. Essentially the BAE loan amount 36 was based on 75% of cost. Their notations said 75% of value but it was based on 75% of cost. 37 We based ours on current lending standards of 70% of value and that is what is included. The 38 sales prices were identical except for die 15% BMR now, sales percentage fee is five percent, 39 which is the same. So the bottom line is when all the costs are included it is a 6.7% profit is 40 what you get on a 2.0 FAR. The banks look for 15% so it is not feasible at 2.0 with all the costs 41 included. So if we want housing to be economically feasible the FAR needs to be increased or 42 the current PC Zoning option must be retained to allow for real design and appropriate public 43 benefit. Thank you for your time. 44 45 46 Chair Burr: Thank you. Doug Ross to be followed by Ole Christenson. Page 20 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 i6 17 18 19 20 21 22 23 24 25 26 27 28 29 3O 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Mr. Doug Ross, 909 Alma Street, Palo Alto: Good evening. I am one of the members of the Palo Alto High Street Partners. I would like to commend BAE and the architect for their work. They did a commendable job in a short amount of time but there are some issues that were covered earlier and I would like to focus on primarily the architectural ones. The economic analysis indicates that there are inadequate redevelopment opportunities on the existing small parcels at about 10,000 feet, which is the majority of the mix in the SOFA 2 area. The analysis is directly linked to the architectural prototypes and if any of these assumptions change it affects the economic analysis. I think ultimately probably we all would agree that the parking controls the density for most of these opportunities. In reviewing the Staff recommended large lot 1.5 FAR I have several concerns. The alley parking, which is covered by the units above on the second floor, is not factored into the allowable FAR. That ultimately reduces the residential, retail or office yield with therefore reduces the revenue. If you look at Addendum O as part of this analysis you will see that using a 250 square foot average car space for the 18 cars that are parked in this area would add about 4,500 square feet of FAR which would reduce three units on the pro forma. The existing alley is presently 15 feet wide. The tuck under parking does not have a 25 foot standard backup zone. It has just the alley which leaves you about ten feet shy. Now I just received the updated drawings I haven’t scanned them but it looks like that condition still exists. This would mean that the parking element would need to be indexed back approximately ten feet into the project which would require a significant redesign and lost square footage and therefore lost revenue. So I think the FAR issue along with the inadequate backup space would probably revise the entire pro forma and probably make this analysis not viable from my perspective. There is a variety of smaller issues but I think ultimately that you need to carefully examine the prototypes and the economic study. There is a charge from the Council as I understand it, which commissioned the whole SOFA study to provide the necessary housing in this area. I think these things have to be looked at quickly and tonight we see we are getting new information, new drawing, to carefully evaluate them. Thank you. Chair Burt: Thank you. Ole Christensen to be followed by Mark Sabin. Mr. Ole Christenson, 801 Alma Street, Palo Alto: Some of the subject of what you were looking at tonight had to do with my property as an example, 801 Alma. I wouldn’t be here tonight if the Planning Department had properly made the program work for me with IDO and Premier Properties last year. What really happened was I had a deal similar to Alison’s on the table but because of delays in the historical valuation of my property I never got there. The deal fell through before that happened. It took almost five months. So I am here today to give you some feedback into that and to give you a new set of numbers to work with. Some of the numbers that we had with that was IDO was going to lease my building for starting at $3.00 per foot. They were going to put $3.0 million into my building and build a three story multilevel with five car parking inside. The rest of the parking would have been grandfathered due to that CDS that we heard about earlier. Just looking at the $3.00 per foot number by itself by using their number system tonight makes the value of my property $3.5 million just by itself. What they wanted to do was put $3.0 million into the building and lease it from me for 18 years and then I get it all back. That never happened. So valuing the property itself is key to the way these redevelopment projects work. I think all the numbers even while they have done a good job of showing you the information tonight their land values are way off. Land values, especially in this new transportation district, could be quite a bit higher than what we are looking at. I think the other Page 21 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 thing we need to look at too is I want to develop my building. I would like to see a four story building on my site. Your plan does not allow that but my numbers that I have just sketched here tonight looking through what Doug Ross has done and theirs, we could actually do 15 units on my site, tie in underground to an existing parking structure that might exist just like Mr. Ross’s project that he is planning to do later. So we could provide 30-plus parking place, maybe 35 underground, more than we need to park 15 units giving benefit back to the City2 To do that we would need to have probably a four story building with setback maybe starting at 35 feet moving in 30 feet and moving up again. So there is real stuff that needs to be looked at. before you make a final decision. Chair Burt: Thank you. Mark Sabin to be followed by Simon Cintz. Mr. Mark Sabin, 533 Albert Avenue, Sunnyvale: I have listened to all this talk about economic feasibility and that is very important but I think there are bigger issues that have to run with the decisions here as well. About a month and one-half ago I took a look at some of the properties where they redeveloped some of the historic buildings. They are beautiful homes. They did a great job. I am sure that the prices that they are asking are certainly make it economically feasible to do that. At $1.5 million to $3.0 million a pop there aren’t a whole lot of folks who can possibly afford that. That is my primary concern here. We n.eed to provide incentives, we need to provide opportunities so that individuals who are looking for attainable housing and there are somewhere between $500,000 and $800,000 to $900,000 can actually afford to live here. If we are creating such a low threshold in terms of FAR that makes that impractical or not possible then we are not meeting a critical need in this community. Frankly, there really hasn’t been any development in this town in the last 20 or 30 years that addresses that need or very little at least. There are plenty of critical contributors in this community who that is all they can afford if that much. If we are not meeting, if we are not trying to address those needs we are only exacerbating the problem of keeping good people inthis town and .also exacerbating the problem of those good people coming from their homes somewhere else and working here. I think that is a critical need that needs to be addressed. There are very few opportunities that we have in this town to address this. This is one opportunity. We need to make sure that we make that opportunity happen. Secondly, this a transit area and if you are 0nly building low-density housing we are not contributing to that critical mass threshold that is going to make mass transit more viable not only in this immediate area but with that critical mass making transit alternatives more viable in the rest of the community as well. If an individual is commuting from Morgan Hill a local transit program is irrelevan~ to them. If we can create opportunities within the transit corridor where we need that critical mass it not only makes it more feasible to create that new transit but also make it more of an opportunity to expand it as well. I think these are things that are important to consider in the decisions. Thank you. Chair Burt: Thank you. Simon Cintz to be followed by Joy Ogawa, our last speaker. Mr. Simon Cintz, 1027 Alma Street, Palo Alto: Hello, my family and I are property owners in the SOFA 2 area. We own three small pieces of property at the south end of Alma Street, 1010, Page 22 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 1 1027 and 1035 Alma and then more in the heart of the SOFA area, 880 Emerson which is an auto 2 repair facility at the bottom and at the top a dental lab which is run by ong of the Palo Alto 3 dentists who has his office in anther part of Palo Alto. This property is all family owned, my 4 brother lives at 1045 Alma, which is just at the very edge of the SOFA area here. He would be 5 here tonight but he is on vacation so I am here talking. I want to thank everybody that has " 6 worked very hard on this, the Working Group and the people in the City. It is a very 7 complicated plan. I can certainly say some things about my own properties but I want to say 8 something about the plan as a whole. I think the key thing for small property owners like myself 9 and people in my family is the flexibility when you put this plan together. It is very complicated 10 that you make sure that the small property owners have the flexibility. One of the things I am thinking of is the restriction on first floor office reduces that flexibility. There are issues of FAR that were discussed before. I think I just learned word FAR the other day when I met with one of the City people, Lisa, and she sort of explained how the plan would affect our pro~perties. Something else is parking of course. I think that the flexibility is what is going to make, for the small property owner and there have been a number of people up here that fall into that classification, this plan work. Thank you. Chair Burt: Thank you. Our last speaker is Joy Ogawa. Ms. Joy Ogawa; 2305 Yale Street: According to the BAE report it concludes that existing market conditions would not provide sufficient incentive to redevelop a small site approximately 12,000 square feet or less. Under a 1.15 FAR alternative however it reaches a conclusion that says the BAE assumed that there was an existing 10,000 square foot auto services building. So in fact the analysis evaluates the financial incentive to scrape an existing auto services building and build a new one. I don’t think that the goal of the SOFA 2 Plan should be to scrape all existing auto related services and it seems to me that the goal should actually be to preserve many of the existing buildings and uses. So it seems to me that the conclusion about no financial incentive under the 1.15 FAR doesn’t really address the question of whether that 1.15 FAR is a good requirement. I personally prefer to see no financial incentive to scrape existing auto services buildings .and redevelop. With respect to PC District which I generally don’t support BAE concludes that there is a sufficient financial incentive to redevelop a large site under a 1.15 FAR and standard parking scenario therefore I don’t see a good justification for permitting a PC for large sites. I also don’t think that it is fair to ask SOFA neighbors to endure increases in FAR just so that .substation relocation costs are paid for. With respect to parking I think that any reduction in parking has to be justified by a demonstrated reduction in parking demand. As far as the situation at Ellison’s that was brought up I think a better way to prevent that sort of thing is to change the Zoning Ordinance so that when there is a change in use from retail auto services or personal services to office or business services the ordinance should be changed so that the preexisting parking is no longer grandfathered in as it is now. The grandfathering of the parking is the problem not the FAR incentives. We should fix this in the Zoning Ordinance Update if we can. With respect to ground floor office according to the BAE memo the concern is that restricting ground floor offices will deter redevelopment projects that create mixed-use projects. So therefore if you do allow ground floor office, which I am not necessarily advocating but if you do then ground floor office should only be allowed for mixed-use projects that include residential. Page 23 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3O 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 Chair Burr: Thank you. That concludes our public comments. NOW we are at 10:20 already. First I would like to thank all the members of the public for very thoughtful and considerate comments and the Commission and the Staff greatly appreciate everyone’s input. It definitely adds to us being informed for our recommendations. Thank you all. At this time I would like to return to the Commission for additional questions to Staff. Because tonight we would like to be able to go through the Attachment A SOFA 2 Discussion Topic and provide Staff with what we may call preliminary recommendations or guidelines from the Commission so that on the 21st of August they will have had an opportunity to incorporate those when they come back to us for final consideration. That would be our primary objective tonight is to get as far through this Attachment A table as we can. So we can just proceed on the item by item as Staff has listed if that is amenable to the Commission. Bonnie and then Karen. Commissioner Packer: When I look at these items height, FAR, PC Districts, and residential density I find it hard to talk about each of those separately. I feel like Ihave to look at at least those four as a package because they interrelate. In other words, we have already talked a lot about height and where we want it in our map but when we talk about FARs and residential density and the concept ofPCs I have to talk about them as a group because they interrelate. I don’t know how the other Commissioners feel about that. Chair Burt: Karen. Commissioner Holman: I was wondering if we could ticl~ off just a few things that we could probably agree with for instance the essentially R-1 housing that is currently zoned R-2 but it is really R-1 housing that primarily is residential so we can just kind of take that out of the map and kind of carve that out because it is probably going to stay what it is. Chair Burt: What are you referring to on that? Commissioner Holman: This is the southeast portion of the SOFA 2 map. Chair Burt: So you are referring to Attachment B? Commissioner Holman: Attachment B, yes. The area that is along Ramona between Channing and Addison and along Addison from Ramona to Emerson. Ms. Furth: That is a map of existing zoning. Chair Burt: Okay, if we can have Attachment B up there I think what Karen is referring to is in yellow and stands out clearly in that way. Ms. Grote: What we tried to do is actually augment Attachment B. Attachment B showed the R- 2 area in yellow. Chair Burt: I see, what is up there in the R-2 in the clear area is what we are referring to. Page 24 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 1 Ms. Grote: Right, we put it in white in this so it would show up better. It is the R-2, there are 2 some PCs then there are some multifamily zones as well, One is RM-15 and I think the other is 3 RM-30. It is essentially those areas that are marked that are residentially zoned currently or PCs. 4 5 Ms. Furth: And those are all areas where the Staff recommendation is that you not basically 6 change the zoning in those areas. 7 8 Chair Burt: So Katen, is ydur request that we endorse that Staff recommendation? Is that what 9 you are talking about? 10 Commissioner Holman: Yes, with one caveat, that if a property was redeveloped that no fewer units would be allowed to be i:leveloped. Chair Burt: I see that Staff concurs with that proposal. So in the interest of peelingoff an item ¯ that we can quickly arrive at some agreement on, how does the Commission feel about that proposal? I don’t see any objections so we will take that as a consensus. One down. So then if we are left looking at Attachment A tables as Bonnie mentioned, ifI might suggest that the relationship between FAR and PC Districts is intertwined we may be able to hold some independent discussions on some of the other items even though we certainly understand that there are relationships between most of these issues but perhaps we can proceed on the basis of the outline that we havehere with an understanding that FAR, items two and three on this table, FAR and PC Districts, we will open it up to discussion of those two as they might interrelate. Then also recognizing that as we proceed through these additional items that it may be appropriate to step back and look at the whole again. Does that seem all right? Phyllis. Commissioner Cassel: Pat, there is one other thing. These are the major items that we are talking about and yet we have never looked at the development standards or the text itself. I don’t if they are going to give us a final one or where we are going to put that in the system. We can talk about it later, .towards the end of the discussion. Chair Burt: Yes, Lisa do you want to comment on that? Ms. Grote: Thank you. We had anticipated once your final recommendations are given to us that we would revise the text so that it is in the same format that the new Zoning Ordinance would be in so that it is consistent with the new Zoning Ordinance in terms of how it is laid out and it would reflect your recommendations. Commissioner Cassel: No, there were a lot of other small items. There is a lot of duplication. There are some areas where it is inconsistent. Ms. Grote: We are also looking at those areas and you may want to submit those comments to us in writing or just verbally to me but those kind of clean up or administrative things we are looking at. Page 25 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Commissioner Cassel: Okay then we will have to go through.some that aren’t quite so clean. I don’t want you go through those major things now I just wanted us to be aware you are doing it. Ms. Furth: If you are going to submit further directions to Staff please do it in writing so that it can be released to the public so that will be part of the record before our next review. Commissioner Cassel: Well let’s go as far as we can tonight. Some of those may be appropriate for discussion, others may not agree with me. Chair Burt: Let’s begin with item number one, height, Does anybody wish to comment or recommend any changes? Karen and then Bonnie. Commissioner Holman: I am going to support the Working Group recommendation of the 35 feet with 50 feet as indicated in those areas that are indicated on the map, Attachment C, with the addition of the PF Zone which is the utility site to be added to that 50-foot height area. Chair Burt: Bonnie. Commissioner Packer: Sorry Karen, I was going to propose that we support what I thought we had discussed, it was the discussion of Attachment B which would allow more areas with a 50 foot height yet preserve a 35 foot height along Homer and the areas that are close to the R-1 areas on the other side of Addison. But I agree that we should include the PF area in the 50-foot height. So I think we have two conflicting proposals I don’t know how we want to go forward with that. Chair Burt: Maybe a third would be good. I lean toward the Attachment B zones but what I wonder about is whether there should be some setback along essentially High Street and those areas allow 50 feet. When we had the previous Creamery project that was one of the things that I think the Commission and ifI am not mistaken I think ARB had both supported and the project had used some setback on what was a high FAR project but they were able to setback that first street face in a way that made it less imposing on the street front. I think that may be something that we want to consider. May I ask if Staffhas any thoughts on that subject? Mr. Emslie: I am trying to digest the comments. Chair Burt: Take your time. Ms. Furth: There is a step-down to the 35-foot along Homer. Are you asking whether that would also be appropriate along Channing? Chair Burt: No, along High. Ms. Furth: On the High Street frontage. Chair Burr: Yes along High Street. The amount of setback in my mind needn’t be as many feet as I think we have penciled in along Homer but something approximating what we had in the Page 26 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 previous Roxy Rapp proposal. I don’t know whether it was about 15 feet back and it had a very positive impact on how overpowering the street face was and the tunnel effect that occurs if we have a 50-foot height. Ms. Furth: That was a 15-foot setback from the setback line not the curb line? I can’t remember what the setback line was there. Is it zero setback? Chair Burt: Yes, I think it is essentially from the edge of the sidewalk. Ms. Furth: So 15 feet back from the property line. Chair Burt: Yes. Mr. Emslie: So let me make sure that we appreciate the comment. What has been suggested is not the severe setback of the 35 feet that is recommended in the Homer but some daylight plane if you will that would address the mass of a building as it interfaced with the High Street frontage on both sides. Chair Burt: Correct. It really gives the opportunity to have from the street a sense of a smaller building than it may actually have in FAR. Michael. Commissioner Griffin: That is an intriguing concept although don’t we get into that a bit, I suppose unless it is a PC we wouldn’t, but if it were a PC project along there then we would be involved in adjudicating or otherwise judging the impact of the sole face of the elevation. Chair Burt: Right, and even if it was a PC if this were in the plan as either a guideline or something else whether it be a stipulation or a guideline it would for the future give parameters under which the PC should be evaluated. Ms. Furth: In the charge, in Chapter 19, there is a suggestion that issues about building form should be addressed to the extent possible now rather than on an ad hoc basis. The idea is you give people predictability and try to minimize those case-by-case calculations. Chair Burt: Okay. Phyllis. Commissioner Cassel: Well we clearly don’t have consensus. I don’t like the Planning Commission discussion we had. I don’t like going 50 feet that far back into the area. On the other hand I am more amenable to 50 feet a little more than what the Working Group was interested in. So I come out with a difference balance so that should give us plenty to try to digest. There is a line that the Working Group draws that shows the 35 feet along Alma mid block and I like that. I think it is a better drawing point. I don’t mind it going to 50 feet along High on that side with the setback that you are talking about along High so it matches the 35 feet across the way. I don’t mind the 50 feet north of that in the Staff recommendation but I do not want to see 50 feet go to the other side of High Street. I think that is far too far in and we need a setback along High on the side of the Staff recommendation. The dividing line being where the Working Group has it. Page 27 1 2’ 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 Chair Burt: I think on your proposal on High Street one oft.he things there that is a Comp Plan guideline is to have basically changes in the transition and density and things occur at mid block rather than at mid street. So if on either side of High Street there were the perception of 35 feet on the Alma side of High Street it is 35 feet and then allowed to go to a 50-foot after a 15 foot setback or whatever and on the opposite side, shall we call it the eastern side, of High if that were 35 feet as the limitation that I think would work and might be an appropriate transition. Commissioner Cassel: Especially since the back tends to be on an alley. Chair Burt: Bonnie. Commissioner Packer: I think those are good ideas and it softens the impact of the 50-foot height. The only reason I tend to support the height is that it gives a little bit more flexibility in terms of what you can put in there but something to soften it in the development standards or something, that’s good. Chair Burt: So does Staff understand what is being discussed here? Mr. Emslie: I think so. I think it would help if we were to maybe refer to the map as we walk through our understanding of the suggestion that was made. Chair Burt: Yes, for color contrast it might be easier to put Attachment B on the overhead. That is better yet. That is just about what we were talking about. Which one is that? That is the Staff one. We are finding that Staff had all the insights to begin with. So that is Attachment D. Commissioner Cassel: The only difference in my recommendation is I would pull the 35-foot back along Alma to the mid block between Addison and Channing. Chair Burt: Along Alma to the mid block. Ms. Furth: There is one lot up on that northern edge which is not either RM or PC so there is one lot that would go all the way through that would be RT-35 on Ramona. Chair Burt: Yes I am now recalling that discussion in the Working Group of at one time the transition being as you are stating Phyllis. I think that does seem to provide once .again transition out to the neighborhoods to have, as was just drawn, that 35 feet along Addison between Alma and High on the north side of Addison. Commissioner Griffin: May I ask now, are we proposing here Phyllis, that where it say RT-35 that that remain the same on the eastern side of High Street? Or are we talking about Pat’s suggested increased setback? .. Chair Burt: We are talking about as it is drawn here. Page 28 1 2 3 4 5 6 7 8 9 10 11 12 13 .14 .15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Commissioner Cassel: The RT-35 where it is orange, I don’t know why that is a different color than the next street, that RT-35 would stay that way and then the RT-50 that is across the street would have to be lower along the street edge. Ms. Furth: The question is would you pull the RT-50 back 15 feet or some other amount. Or us the daylight plane would be the way we would actually do it. Mr. Emslie: Let me have a chance to digest that. I think we would want to come back to you with a proposal. I think we would want to essentially work with Freedman Tung & Bottomley to kind of come up with a proposal that deals with that rather than come up with an arbitrary number tonight. So this is one we would like to come back to you knowing that you would like to have a daylight plane and a step. We would like to be able to report to you the ramifications of that in the prototypes. Chair Burr: Does that sound good to the Commission? Michael. Commissioner Griffin: Then I would like to have clarification of the northern portion across Homer Street where on the Attachment B Planning Commission Discussion we are talking about that all being RT-50 on both sides of High Street. Phyllis, are you saying that the eastern side of High Street where reaches for example remains RT-35 or RT-50? Commissioner Cassel: Yes, that whole side of that street on the east side stays at RT-35. We have a big transition to go in a couple of blocks all the way down to those two story houses along Ramona. Chair Burt: That whole side of High Street would be as is on Attachment D in the orange. Commissioner Griffin: So it looks like C, in other words. Chair Burt: No, it looks like D. Everybody okay? I sense that Karen is still supportive of Attachment C, is that correct? Commissioner Holman: I am because ever since the very beginning when we were working on the Working Group the intensity was supposed to get greater as we went towards Downtown. That is why I am supporting the Working Group recommendation because it respects that direction and philosophy we had since the very beginning. Commissioner Cassel: You a~e saying this doesn’t do that? That following the Working Group recommendation on the south side and following almost the Working Group suggestion on the north side along Alma doesn’t meet that intensification? There are just two small pieces of property on the north side that then become a potential for 50 feet that is different than the Working Group. We have a difference on half of High Street though but as it goes north it gets denser that way. Commissioner Holman: It is closer. I guess I have another question which is would the 50 feet, how are the other Commissioners thinking of this 50 feet? Would it be an entitlement or would Page 29 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3O 31 32 33 34 35 36 37 38 39 40 41 42 43 44. 45 46 it be because they are showing public benefit or would it be accomplished by TDRs or be accomplished because it is affordable housing? It is an aspect of the discussion but I think it is an important one. Chair Burt: My understanding is that it would be an entitlement restricted by all the other aspects including what sounds like approximately a 15-foot setback along High Street. Ms. Grote: I believe that the Working Group had anticipated that the 50-foot would be the height limit, it would be an entitled height limit, it would be a permitted height limit of 50 feet in those very specific areas. The FAR would remain the same at 1.15 but the height would go up which means you would have some flexibility at grade as what you would do at grade but it would be a taller slimmer building. Staff had said in addition to the 50 feet which would be allowed,, a permitted use, you could go up to 1.5 FAR with the PC which then started to talk about the other public benefits that would come with it. So the 50 feet in terms of the Working Group recommendation was a permitted 50 feet. You didn’t have to have a public benefit that went with it. Chair Burt: I think we should all acknowledge that on these items that we are trying to move forward tonight we are not necessarily going to get unanimity but we can get a sense of direction for Staff and then we are going to have a final opportunity to vote on these things. We are trying to give Staff tonight guidance so that what we receive back on the 21st will be something that we will consider for a final approval. Phyllis. Commissioner Cassel: Pat, my general goal working these things through would be to go as much entitlement with its limitation and as few desires to go towards a PC as possible. I think that is the nature of going to this kind of a plan so people have some consistency. The goal would be to need as little PC process as we can possible give. Chair Burt: Well item three is specifically PC Districts. Item two, which I would like to move on to, is the FAR. Mr. Emslie: One thing we were hoping to do is, obviously we have to bring this back in a final form, we would like to be able to have a good enough sense that the majority of the Commission is going that way so we minimize revisiting the issue. Chair Burt: Can we do this in forms of straw votes? Mr. Emslie: That would be great. Ms. Furth: What you are doing tonight is essentially a straw vote. We need to draft something. So if we draft it one way so you can change it that is easier than if we try to leave the alternative. Chair Burt: Okay, so on the proposal as last stated, I think everybody has a sense of what that is, 50 feet with a setback from the west side of High to Alma with the exception of along Addison and 35 feet on what we are calling the east side or the northeast side of High. Page 30 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 -19 20 21 22 23 24 25 26 27 28 29 3O 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 46 Mr. Emslie: It is as Exhibit B as we modified it on the board and with the exception of Staff given direction to develop a daylight plane for dealing with the interface between High and the 50 feet. Chair Burt: Right. So who is in favor of that? We have four votes in favor, one opposed. Ms. Furth: I am gorry I didn’t catch that. was Attachment D. Chair Burt: D, yes. Mr. Emslie: Chair Burt: It wasn’t Attachment B that you were working f~om it It is what is up on the board that is there. Right with the addition of the setback on the west side of High. Commissioner Holman: Pat, I just want to make sure this is real clear. So the step down is the height limit at High Street is 35 feet with a minimum setback of that height or retaining that 35 foot height 15 feet back. Chair Burt: Approximately 15 feet back and Staff is going to come back with a specific recommendation more of a daylight plane sort of concept. Okay, everybody ready for item two, FAR? Who would like to start off? Karen. Commissioner Holman: I am going to support for a number of reasons. I am going to support the Working Group FAR of 1.15. I will just throw that on the table and I’ll come back later and say why I am supporting that. Ms. Furth: That would be .4 non-residential up to 1.15 residential. Commissioner Holman: Correct. Ms. Furth: An no case is more than 1.15. Chair Burr: I would like to go a little out of turn on this one and just toss out for the Commission’s consideration something I have been thinking about. As we are looking to try to create opportunities and some incentives for greater housing given that over the last four years we have achieved the office portion of the mixed-use of this plan area, when we talk about mixed-use we often are thinking of it in terms of mixed-use in a given project but we have very little housing here. We have had a lot of conversion to office and we have achieved that office portion of the mixed-use. I would like to have the plan move even further than the Working Group proposed in essentially discouraging additional office in properties that are redeveloped. At the same time have greater encouragement for the residential. So along those lines I would like the Commission to consider reducing the allowable commercial FAR from .4 to .25 and increasing the residential FAR to whatever the Commission ends up agreeing to. So if you have a mixed-use project then the allowed FAR for mixed-use would stay at the current 1.0 FAR that Page 31 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 2O 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 46 is in the current zoning but have .25 of that as allowed for commercial rather than the .4 that is currently allowed in the Working Group and Staff alternatives. Then whatever we end up agreeing to on the appropriate residential FAR whether it be what is zoned or what we might put under a PC with a cap. Bonnie. Commissioner Packer: I agree with you Pat that we want to do what we can to encourage residential I get a little nervous with the smaller sites. If we want retail on the bottom and we want housing on top and if you wanted to promote retail or something on the bottom floor whether something that is small would allow you to do that on a small site. Maybe you would end up with too small of a place. I like your concept of encouraging more residential. I would support for a non-PC an entitlement, a minimum of 1.5:1 FAR, especially based on the economic analysis and what may be feasible. It is a moving target depending on what kind of cost a developer has to incur. This isn’t because we want to redevelop SOFA but it is ;¢ery clear in the Comp Plan and even in the SOFA Plan itself it says we want to encourage more housing and that is what we are talking about. Chair Burt: How are you proposing the 1.5? Commissioner Packer: Residential. Chair Burt: Only residential and retail combination as opposed to a mixed-use that Would allow commercial office in addition to the residential and whatever small amount of retail goes with that? Commissioner Packer: I am not really sure how that works out. I want to ensure that we have residential with a little bit of retail office as necessary in order to give developers flexibility and choice. It doesn’t mean they are going to use the commercial portion. They may decide that it is more beneficial to use the residentia.1 aspects. So how do we do that in the FAR? Is it 1.5 plus .4? No, it is included. So if you have a .4 then you are really going to effectively only have 1.1 of residential. Ms. Furth: Unless the marginal costs of having mixed-use development makes straight residential more desirable. Commissioner Packer: Then I would go for 1.5 and if they want a little bit extra have it beyond. In other words, I would like to have more density for residential and not sacrifice any of it for retail or office. Chair Burt: Michael. Commissioner Griffin: I am wondering, we spent a lot of time on economic studies here and I am wondering if we have any comments from our consultants here on how that would affect the economic viability of all of this, if we are interested in all of that. Like the people from the Working Group said that wasn’t part of their charge but it seems to be part of our charge to be aware of the fact whether it is going to pencil out or not and produce incentives for people to actually undertake these projects. So to go with your proposal of using a .25 instead of a .4 for Page 32 1 2 3 4 5 6 7 8 9 10 11 12 13 t4 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 the commercial component would anyone on Staff or the consultants want to discuss what are the economic outcomes of that? Mr. Emslie: First of all let us make sure we fully understand that proposal. The reduction in the non-residentiai FAR from .4 to .25 is that across the board for all non-residential or all commercial or would that be focused in on the office and the general business designation and preserving the ability to do retail and personal services up to the .4? Is it just a certain segment of the commercial that we are after or is it across the board? Chair Burt: My objective is to reduce the office portion. In doing so my understanding is that if we retain the existing restrictions on ground floor office along the Emerson corridor for instance and maybe Lisa can help me on some of this, what the other aspects that are currently in the proposal that the de facto outcome would be that with my proposal we are not restricting retail in any way but we are constraining the potential office in those areas: Can you share with us your perspective on the impact of that proposal? Ms. Grote: Under current zoning requirements with the .4 it is unlikely that someone would be able to use that entire .4 FAR in office use because we have either a 25% of the overall site area limitation or a 5,000 square feet in office whichever is greater. So it is unlikely that someone is going to get their full 40% of the FAR in office use alone. It would probably have to be combined with something else such as business service or retail or personal service. So if you, are looking at trying to limit or reduce that FAR, that .4, you may want to look at reducing the office portion of it which might to be really much of reduction of what people currently have an entitlement to do. It wouldbe limiting the remainder of that .4 to other uses that you do want, community serving or neighborhood servicing personal service, retail or other kinds of uses. Chair Burt: That would be the intention of my propqsal. Commissioner Cassel: I don’t agree with you Pat. I think we should leave it at the .4 that the Working Group recommended. I think even the Working Group is very restrictive because the market does change and it has been very hard to see some small businesses go. Right there is a lot of open space down in that area and in every other part of town. In some of those areas if retail will work it will come back into there. Chair Burt: This wouldn’t restrict any retail. My proposal would do no restriction on retail. Commissioner Cassel: No, but it allows more office and what the general feeling is is that if you limit the office that you will automatically get retail to replace it. I don’t know that that is true. I think that is why we are limiting the office spaces so that the ground floor will stay more retail. We have been trying to limit office space in that area so we will get more retail in there. Chair Burt: Within the current plan proposal yes, and the Working Group looked toward reducing new ground floor office especially in the critical retail hubs. My proposal would certainly not be detrimental to retail in any way. What it addresses is the issue of whether we are going to address a greater housing density in this area whether there should be an achievement of minimizing the jobs/housing imbalance if we simply increase more housing and still increase Page 33 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 .30 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 46 office use on top of all the office conversion that has happened over the last four years then we have a lot less net gain. This discussion, as I recall it and Karen maybe can share with me, didn’t really come up as an alternative that the Working Group evaluated. Unfortunately we have the public comment closed but I would be surprised if the Working Group were opposed to reducing the office commercial space. Karen. Commissioner Holman: I would agree with you that the .25 FAR for general office was not discussed, As Bonnie said, it is kind of difficult sometimes to address one thing and not the other and we have blended into the ground floor office. I am going to go ahead and state some of my reasons for suggesting the 1.15 FAR. The current time that we are in now is a very low return for developers. As I understood from one of the well-known developers that is on the Working Group construction costs have really not gone down much at all. So if what we ’are hearing is true that this is the lowest lease rates that we have seen, some people say even since the 1970s, it would seem that the return rate is going to go nowhere but up which would mean that this program becomes even more feasible at the 1.15. The other thing to consider is that feasibility studies are one thing that we need to consider and compatibilities and all the other charges of the SOFA 2 Plan are also things that we need to have in our minds too. So dealing with the office, to my mind, because SOFA 2 is a mixed-use area as we have discussed with retail, with office, with neighborhood business and with housing and the charge was to recognize that this is an eclectic mixed-use area, that rents that offices can bring in stronger economic times displace other uses and drive the land values up even higher making our goals of housing and neighborhood serving and retail even harder to achieve and because we do have a bad jobs/housing imbalance and because office doesn’t bring sales tax to the community and that it is known that land value is driven by the allowed uses so office does drive the land values up. You said you were going a step further than the Working Group I am going to say that no new office south of Homer except along Alma Street, allcw existing offices to remain and north of Homer any new office should be restricted to above .ground floor. Chair Burt: Bonnie. Commissioner Packer: We are sort of mixing the office question in with the FAR and I thought that comes a little bit later. Just to address the office issue, we heard from the public today from the small business owners urging us to be flexible when it comes to uses. The economy goes in circles and twists and tornadoes and all kinds of things. Things will change and I just feel like we can’t as Planners control all those economics. I think we just have to be a little bit more flexible. I don’t want to restrict office that much. I want to go back to our FAR discussion because I thought that is what we are talking about. The percent of offices, .4, .25 whether it is office or retail I think we have to have some flexibility in just general commercial space whether it is office or retail so that developers can be flexible and fine-tune and micromanage. I want to go back and say why I think it is important that we do as a maximum 1.5 FAR not 1.15 because the BAE analysis shows that in most cases that is the place at which things are feasible. That is the level of FAR that it is feasible for the large lot and for the small lot it doesn’t become feasible until you have a higher FAR. So for us to keep at a low FAR means that .we are not going to get any housing development. You have a policy in the SOFA cap that says we want to encourage some more housing and there is a goal for 300 houses and SOFA 1 has only done a portion of that and the rest is on SOFA 2. Then to say that we should have a small FAR of 1.15 you are not Page 34 1 2 3 4 5 6 7 8 9 10 11 12 13 ~4 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 going to achieve the goal. What you are going to achieve is a continuation of the same static condition. So that is why I cannot support the Working Group recommendation of 1 ~ 15 FAR. Chair Burt: Also I might add that the 1.5 FAR is based upon having 2,500 square feet of office in that proposal. That is not a pure residential nor a retail residential mixed-use. So the economic models that we have had so far are not the pure residential models. Commissioner Packer: Over time that is going to change. Right now maybe residential is a little bit more lucrative. In five years office will be more lucrative. It is really hard for us to make a decision just purely on the economic model because it moves around. I think we have to use a little bit of common sense. The more density you allow a developer the more profitable it is probably going to be and things will happen. If you have zoning that limits your options then a developer is not going to’ do anything. Chair Butt: The question I have is do we want to create a circumstance or incentives that whether it is this year or five years from now basically encourages additional office creation in this area beyond what has happened over the last four years. ~My feeling is that we have more office in this area than we probably would desire long term and we may still get some additional conversions beyond even what we would try to incentivize. Phyllis? Michael. Commissioner Griffin: We have been talking about the goals of the plan and I think the plan had a couple of different ideas one of which was to achieve more housing but that wasn’t the only thing that was going on. I am empathetic with what Bonnie says about the 1.5 FAR. IfI understand correctly what the consultants have said tonight on a small property you really need to have a 2.1 in order to get something to pay off. If we are going to see anything happen down there we have got to give some sort of an economic bump. I think 1.5 would achieve that. I think with the 1.15 that Karen proposes we would see a static situation. I am sure there are a lot people that are going to say that’s great, just leave it the way it is. I think that we have got to throw a bone here to part of the vision of the SOFA statement, which is to build some housing and I think 1.5 would get that,for us. Chair Burt: I would like to add one other thing that struck me in this well laid out Attachment A that is under the Comprehensive Plan Policies. I had to go back and reopen the Plan and look at where this was and it said page L-12 and that was not a policy but it is the definitions of the new sorts of uses. This was under the definition of the mixed-use where floor area ratios would range up to 1.15 though residential retail and residential office located along transit corridors or near multi-modal centers will range up to 2.0 FAR and up to 3.0 possible in areas resistant to revitalization. We only have a few spots in the whole City that are truly transit oriented development sites geographically. Just a few right around here at this location and on either side of University out at Alma and at California Avenue. There aren’t others that are truly transit- oriented development. So my thought is that really regarding transit-oriented development if not here then where? If we mean that we are supposed to have transit-oriented development and densities here and that we have a new urbanist plan that says we are not going to redevelop the suburbs, we are not going to densify, we are going to protect those neighborhoods but in order to achieve the Comprehensive Plan goals and encourage transit this is the place that the density should occur. As far as the conversion of some transition from allowable office use, jobs Page 35 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 46 creation, to residential which is something that is a regional concept as well as a concept that we are trying to do within this City this is one of the few times where there will be very little economic resistance or comparatively little economic resistance to that sort of change because now the differential between the value of housing and the value of office is a pretty low differential. Arguably right now maybe even preferring housing in certain circumstances. So if not now, when would we ever be able to accomplish this? If we don’t take advantage of an opportunity now to create transit-oriented development at one of the few sites in the City that it is appropriate and we don’t take advantage of the opportunity to reduce the office commercial opportunities and increase proportionately the residential then why do we keep talking about these things in the Comprehensive Plan? Why are they foundations of the Plan? Why do we kid ourselves about these objectives? Commissioner Griffin: Okay, so pick your number. Chair Burr: I threw down the gauntlet to you guys on that one. Commissioner Cassel: We threw it back. What is your number? That is what we are talking about in terms of FAR. Chair Butt: FAR and I am still struggling with what is the appropriate number but I think that the .25 commercial FAR which would allow the continuation of the retail incentive that we want coupled with an entitled FAR of 1.5 for a mixed-use retail residential project but that the increased FAR would not be provided if the project included whatever allowable office they could have at the 1.0. So they only get the bonus if it a residential and retail project, the two things we want to try and achieve in this area. Then we are going to have a separate discussion about whether anything above that should be allowed for PCs in this area and what types of public benefits would be significant that would justify a PC, what sorts of sites are appropriate that basically say a PC is the appropriate tool for a specific site and that is why a given site along with certain public benefits we would consider a PC. So we have those two considerations. Yes, Ms. Furth.: I was trying to take notes on this. A purely residential project would have what FAR? Chair Burt: Ms. Furth: FAR? I am not saying purely, it would be residential/retail mixed-use. But if it was just a proposal to generate only housing, no jobs, on the site what is the Chair Butt: I understand the question I am struggling with the answer. Ms. Furth: The zoning says that you can do mixed-use or you can do all residential. So if you did a mixed-use residential/retail project with no office then the FAR would be 1.5. Chair Burt: Yes. So hypothetically we might say if we want to incentivize the retail with a project that is say hypothetically. 1 FAR of a project being the retail then maybe we would say Page 36 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3O 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 the project can be 1.4 but with the retail component it could be 1.5. Now I am still struggling as to what is the exact formulation proposal but that is a hypothetical. Ms. Furth: I am sorry, if you had a mixed retail!residential program you could have a 1.5 total with. 1 retail. Chair Butt: Yes. Bonnie and then Phyllis. Commissioner Packer: Pat, I think your idea is worth thinking about but maybe it would be easier to work with and to develop better projects if that concept were in the context of a PC and we give for the non-PC part of the zone clearer numbers and clearer expectations because each site is different. Some sites you may not even want to have retail like Alma and you may want to have 100% residential at 1.5. In other words, it is an interesting idea but maybe not for the straight non-PC part of the SOFA. Chair Burt: That is a good point. We haven’t officially gone into the PC area but in the PC question there is not only what is the allowable size of the PC question but also where within the plan should PCs be allowed. My first inclination would be that the PCs would be restricted to that area that we had had as the 50-foot height limit, the transit-oriented development zone and no PCs allowed.elsewhere. So then we would have a separate question of if the proposal I was suggesting were the baseline FAR for what we may call the transit-oriented development area, the yellow zone, then we will have a separate question of what should be the FAR for the balance of the area and what sort of mix. So we really have I think two different geographic areas that we have considerations of each of these policies on. Phyllis. Commissioner Cassel: I lost you. I was going to throw out a different idea. That we stay to the 1.15 along Emerson. We do the 1.50 along High and that we do the 2.0 along Alma. I keep trying to get it from the higher on the outer edge down to the lower towards the residential. In addition to that we have been trying to keep the small scale that is along Emerson that meets the housing units that are there and the businesses that are there at the current time. I don’t agree with you on that .25 because I think it is going to be too restrictive on the small businesses that come along in that area and they were asking for in that corridor. They need some flexibility to come and go and to be able to maintain that area which seems to have been improving in the immediate near past. We have a tendency I think to think that small retail is the answer to everything and it only serves a certain amount of area. These small businesses serve certain amounts of small service areas and you only need so much of it in an area. We just keep wanting to put it in everywhere because it seems so nice. It is our pet for the moment. I think that some balance between the office as we get down into that more but this gives us a transition from high on the edge right down into the residential zone. Chair Burt: Karen. Commissioner Holman: I am closer to where Phyllis is, I agree that .4 is a good place to stay for retail and neighborhood serving. If you don’t want office just don’t zone for it. Don’t allow it in the zoning. That is the cleanest way to take care of that. I am supporting the Working Group 1.15 and I made the statements earlier about why I think that is feasible, maybe not as much now Page 37 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 46 as it will be in the future, hopefully not too distant future. There are other ways to get the 1.5 and it is hard to exactly talk about these one at a time but I think there are ways to do that. I think there should be allowances for affordable housing, they could go 1.5 or maybe even higher, surely higher than 1.5. The other way is, PCs were mentioned, I fell on both sides of that and struggled with that but I have come to the conclusion that that’s not necessarily the best way but I think TDRs you can have again perhaps in the area that is indicated here as the 50 foot height with TDRs you could have a 1.5 FAR in those areas. Chair Burr: Michael. Commissioner Griffin: Well let’s talk about this concept of having one set of FARs for the RT- 50 zone and another set for the RT-35. I am presuming that you are thinking about a base FAR on one for each side and a PC limit one for each side. Chair Burr: My thoughts are that we perhaps would not allow PCs on the 35-foot height zone. Commissioner Griffin: And yet we have been listening to the economic people say that with these small lots they are going to be very difficult to change, if we do want to see them change. If we do want to see them develop it seems to me like you ought to consider PCs on these small properties in the RT-35 area. Chair Burr: Phyllis and then Bonnie. Commissioner Cassel: I may have the PC thing backwards. I don’t want tothrow out PCs and we are not into that section because we keep running into these odd spots. We may want to put some limits on them and I can understand people getting frustrated with them. I just think that to throw out PCs is wrong until we come up with another tool. People were discussing this in our last meeting when we were talking about the Zoning Ordinance in general. I just think we want to make it possible to develop as many of these lots as we can without PCs but there are going to be some. We have done one this year already in which the lot was such a weird shape and we were going to preserve six oak trees. Well we are going to get into some of that here. We want to preserve all the oak trees or we want to preserve all these trees and some of those lots are going to have trees in the wrong spots so we are going to need PCs for things like that. We should see if we can go back to this other issue, the FAR issue, which is tough. Chair Burr: Can I add one quick response? One other thing we may consider is that PCs although they most often involve FAR bonuses they needn’t. We can have a PC that deals with various things, setbacks and things like that that preserve oak trees and whatnot without necessarily allowing an increase in the FAR. It is a site design flexibility tool but not necessarily a building mass bonus. I think a lot of the neighborhood and the community is concerned with it being a building mass bonus and that my concept of restricting PCs to that transit-oriented development area is that that’s what gives the neighborhood some greater assurance that there won’t be some PC that is massive and intruding upon what we are attempting to provide of a transition toward the neighborhoods. So that was the thinking on restricting the PCs to those areas that we are really looking for the density to occur. Bonnie. Page 38 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3O 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Commissioner Packer: I just want to respond to Phyllis’s proposal. It is very intriguing to me to have a sort of a step down FAR as we go east. Is that essentially what you are talking about? I think it would be worth pursuing but any FAR restrictions that we have would only be in the context of allowing PCs with very carefully crafted parameters. I don’t know how to do this Brown Act wise. I had put something down at the desks of the Commissioners with some ideas. When we get to the PC section I will read that just so it is in the public record. Ms. Furth: Do you have copies of it out for the public? Commissioner Packer: I didn’t have a chance to have copies for the public so I thought I would be doing a public reading. Ms. Furth: Then you could just read it. Commissioner Packer: I want to do that at the appropriate time. We are sort of moving a little bit into PCs so does it make sense ifI do this now? This was a proposal that I thought about this afternoon before I saw the changes and heard the economic report and the prototypes. That doesn’t mean that I am supporting everything in my proposal now but I have to read this thing because I put it at your desk. It was supposed to work as a package to achieve the goals of the SOFA 2 Plan in .light of the conclusions of the economic and prototype design analysis. What I was proposing which allowed height limits, which are in Attachment B but we agreed to go for Attachment D with the changes. I was proposing that FAR for residential be 1.5 and non- residential .4. In the RT-50 zones I addressed density of 40 units per acre with a minimum density of 20 units per acre. I think these are the Staffrec.ommendations actually. In the RT-35 zones density would be 30 units per acre with a minimum density of 15 units per acre and the maximum unit size of 1,500 square feet and allowing for reduced parking with Planning Director approval of up to 25% and try to have more 30 minute only parking on the City streets near retail. I guess this happens anyway you don’t count podium or underground parking in the FAR. Here is where I thought we could have some discussion. If we have Planned Community applications we should be allowed along the way that PCs are allowed in our current zoning with the three findings that have to be made and the whole process but with some additional limitations. The PC can’t go above the heights that we agreed to in the various zones. I threw out in this paper that it can’t exceed an FAR of 2.5:1. That was based on the original version of the economic analysis, and I am happy to talk about a smaller FAR, and it cannot exceed an FAR of .4:1 for non-residential use. A PC application would be predominantly multifamily residential. The individual units cannot exceed 1,500 square feet and I think this is a Working Group recommendation. The developer would have to provide public transit use incentives such as eco-passes or TDMs. The design of the project should reflect the goals and policies and the spirit of the SOFA 2 CAP. The public benefits would substantially enhance an important societal goal and I have a list of items and that the project should have at least two of following benefits: increase the BMR ratio from 15% to 20%, I am assuming that the 15% becomes the law; provide substantial numbers of even smaller units for either low or moderate affordability in addition to the BMRs; provide substantial public parking; perhaps provide a daycare facility; a well designed public gathering space; neighborhood serving retail space; perhaps below market rate space for community or non-profit services as examples. These are ways of having PCs that Page 39 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3O 31 ¯ ~32 33 34 35 36 37 38 39 40 41 42 43 44 ~45 46 are different from what we have normally seen that are very open-ended in terms of public benefit. So this is what I throw and I have read it into the record. Chair Burr: Phyllis. Commissioner Cassel: I think we are getting into a real time crunch it is 11:30. Are there any of these that we can do real easily? Chair Burt: I think we might have some we can do more easily but what does Staff really need? Mr. Emslie: One thing I think we could help out on is the proposal to reduce the office FAR. Before you decided on that we would want to present to you the analysis that Lisa alluded to, where is that break point and what prototypes go with that. So if you would like to direct us to do that analysis you don’t have to come to a decision on that tonight. On the 21st we can have that and that might help give you some clear idea as to the play betWeen the percentage restrictions and then the FAR. So I think that is something I think we can do. Chair Butt: So if that sounds good to the Commission we will await Staff’s feedback on that. Commissioner Cassel: If we can’t defeat you first. Chair Burr: Phyllis, I am mystified why a housing advocate wants to work so hard to increase the jobs supply. Commissioner Cassel: It is not the only thing in the world. I guess I don’t think you are going to get such a big difference in the supply and I think we have a goal to do some preservation in this area as well. It is a very difficult balance to meet to get both more housing and to preserve some of the unique characteristics of the area that I think people envision. Chair Burr: .Remember we are talking about new development. We are not talking about existing development. Commissioner Cassel: I understand that. Commissioner Griffin: I will just say that we want this stuff to get built and Bonnie just read off a very ambitious list, which I totally concur with in terms of benefits for a PC. So I would like to see some of this happen and there is a part of me that worries that if we throttle back too much on this .4 we will be deincentivizing this process. Chair Burr: I might just add that the one project that is going through the pipeline right now is an all residential with small retail and no office proposed. So that seems to suggest that at least at certain FARs that is viable and to that developer a preferred option over a mixed-use office. Commissioner Packer: Pat, that is being done without any incentives from any zoning plan. It is being done because of the market. Page 40 1 2 3 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 46 Chair Burt: Right but the point I was making was that Michael was concerned whether the market would create the opportunities to do the sorts of development we are seeking. Ms. Furth: One thing you could tell us that would be helpful is what your goals are rather than the particular numbers. The previous iteration at 800 High as I am sure you remember was a mixed-use project, which had housing. But when you ran the numbers it generated more jobs than worker housing. So there are many ways .to evaluate a project but in terms’of looking at jobs/housing balance you would have said no to that PC. If you can tell us what you are aiming towards then we may be able to provide you suitable numbers or standards. Chair Bul~.: Karen. Commissioner Holman: My aim certainly is not to increase the jobs/housing imbalance by allowing for more general office. If it is a retail or neighborhood serving, that kind of office if you will just to lump it all together, if it is that kind of office and it is providing a service, it is generating sales tax, there is a purpose for it being there. There are amenities for the residential then hopefully we will get some of the residential, I am sure we will. So that would be my goal. Chair Burt: I am sure as the other member of the Working Group and Karen and I have been on this for five plus years, SOFA 1 and SOFA 2, what we saw as SOFA1 was ending and SOFA 2 wag just beginning we saw a transformation occur in SOFA 2 that precluded many of the opportunities for the evolution that we were seeking. We had a significant transformation of uses over to office in SOFA 2. Now SOFA2 just in the last three years became a heavy office usage area with virtually no housing built in that timeframe. If the original concept was for a mixed-use area and it was really a mixed-use of automotive and retail and some office it has become much more an office area. My g0al in response to Wynne’s request is I would like to see the future redevelopment in this area be predominantly or overwhelmingly residential with encouragement of retail in those areas, those specific hubs that are identified in the Plan. You were characterizing people seeing retail as a panacea and that certainly isn’t my vision. My vision is that retail has to have a certain critical mass and certain key locations to be viable. I am not looking for retail to be everywhere in this area. I am looking for the development that occurs going down the road here to be overwhelmingly residential versus commercial office. Bonnie. Commissioner Packer: I agree with you I just don’t know if sometimes you need a little bit of flexibility if sometimes the commercial space is necessary in order to help subsidize the residential space. I just don’t know this now. Right now that isn’t the case. I don’t know what is going to be in 15 or 20 years. That is my only reluctance to be too detailed in what we propose. I would look forward to what analysis we get from Staff on some of that. Chair Burt: Anyone else want to try to answer Wynne’s question on what it is we are trying to achieve? Karen. Commissioner Holman: This will tell you what I am looking for but also what I don’t want to have happen. If the incentive is too great to create housing, which nobody is opposed to housing of course, will that not put pressures on the existing neighborhood serving and we use the word retail as if that is all that is allowed and it really isn’t and we need to make sure that we are all Page 41 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 1 clear on that. It is personal services, neighborhood serving, all that sort of stuff too, so it is not as 2 limiting as some people seem to think. If we incentivize housing too much I am concerned about 3 us losing our existing retail neighborhood serving commercial. When we lose it we know we 4 have lost it, it is not going to come back. We are not going to get those same independent owner businesses back. Chair Butt: Just a question. Could we include within our guidelines on redevelopment projects. that they would have to retain the level of existing retail? So if there was some small retail on a site there is nowhere in the Plan area that I can think of, excuse me, there are some. Ms. Furthi We have done that. I will leave it to the Planners as to whether that is a good idea. That is what we have done in the retail conversion ordinance. You can redevelop the project but you can’t reduce the amount of space devoted to retail. Chair Burt: Michael why don’t you introduce or explain what you are saying for the record? Mr. Emslie: Maybe while Michael gets ready to do that we just weigh in on the proposal for conservation. Staff sees that consistent with the Comp Plan. The Comp Plan really addresses mixed-use and this is a way to solidify mixed-use especially if you are preserving it on the ground floor you are guaranteeing that it could be incorporated into a larger residential project. So we think that would be consistent with the direction that we see in the Comp Plan. Commissioner Packer: I think BAE pointed out that certain streets are more conducive to retail than others. It could be a little bit limiting to preserve maybe the retail that is on Alma, require that preservation there when it maybe isn’t viable anymore on that street but would work better on Homer and Emerson. So I think again this micromanaging every little use that a developer can have on a site can run us into unintended consequences. Chair Burr: I would like to say that zoning in this way is micromanagement.. I would appreciate not that characterization. However, Phyllis has been making a point that it is 11:40 and as much as we have all recognized the importance of trying to move as far along in this as we can tonight we need to wrap up. Did you want to make another comment? Commissioner Cassel: Yes, I had a question on the historic preservation standards that they are proposing here. I haven’t had a chance to go back and look but this seems to be a reflection all the way back.to the original Historic Ordinance. I am not sure if I am right on that but every one of the buildings that is in category one, two, three and I think four have to meet the historic standards. Ms. Furth: I think it is the same as SOFA 1. Ms. Grote: It is the same as SOFA 1 and it does call for categories one through four as well as those buildings that are eligible for the state or national register to be preserved and if any changes are made that they would be consistent with the Secretary of the Interior’s Standards. Page 42 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Commissioner Cassel: In SOFA 1 we went buildingby building through this to see what was feasible and what wasn’t feasible. A decision was made on every single building as to where it was going, whether it was moving or not moving, could we do that, could it be feasible. I am not doing that for SOFA 2. Ms. Furth: Those were moved consistent with the Secretary of the Interior’s Standards. Commissioner Cassel: I know that. In this area we are not doing that kind of analysis on those buildings. Ms. Furth: It also does, incidentally, cover non Palo Alto Medical Foundation buildings in SOFA 1 that were not analyzed in that fashion but you are absolutely right about the Palo Alto Medical Foundation buildings. Commissioner Cassel: Okay, so you are saying this is exactly the same as SOFA 1. I wasn’t trying to resolve the issue tonight but is it not also very similar tothe ordinance that was mined down by the community as a whole? Ms. Furth: No, I would say that it is more comprehensive because the Historic Preservation Ordinance only dealt with national register eligible buildings essentially. Commissioner Cassel: That’s I mean, it is more comprehensive, that is what I am saying. Ms. Furth: It had an elective provision for anything that could be categorized under state standards as an historic resource. It could elect to be designated as an historic Palo Alto building and then receive incentives. Commissioner Cassel: Okay, you are confirming what I am saying. This is a much more restrictive ordinance than what we voted on. Ms. Grote: Also I did want to note that the map in the plan as currently before you is not complete. There are other buildings on the eligibility list for the state and national register and other currently designated buildings that aren’t reflected on this map. So we will be correcting that. That was a first cut. Ms. Furth: while you are thinking about that issue there is another aspect, the Historic Preservation Ordinance was largely focused on non-commercial buildings, not entirely but largely, our existing regulatory scheme for commercial buildings in the Downtown does have mandatory preservation requirements in some cases. Chair Burt: Okay. Go ahead Karen and then Michael. Commissioner Holman: I’m sorry, Michael. The preservation ordinance, just for clarification, the opposition to that didn’t come from business owners it by and large came from residential. Like Wynne said, it is consistent with what is Downtown. Page 43 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3O 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Chair Burr: Michael. Commissioner Griffin: You are talking about wrapping it up here, I am going to say a couple of numbers and put them out. I am saying for the RT-50 the FAR of 2.33 and for the RT-35 if we are going to have a PC allowed in that area a 2.0. Chair Burt: Wow. I would like to add one other thing. At our next meeting I anticipate that Commissioner Schmidt will be.returning to the discussion and that she would review the meeting and wish to participate so that is going to be another element when we get back together. If we thought that we could arrive at some sort of consensus in the next minute or two, I think that is a pretty provocative proposal and I would really doubt that we could have that kind of discussion. I would virtually guarantee it because I am not going to make a snap judgment based on that proposal. Commissioner Griffin: You don’t think 15 minutes is long enough to do it? Chair Burr: First I don’t think Phyllis is going to give us 15 minutes and I am not likely too either. Commissioner Cassel: I take Bonnie with me. Commissioner Griffin: Well StaffI’m sorry it doesn’t look like we are going to make it. Mr. Emslie: I’ll take Bonnie home. Basically I think we made a lot of progress. I think establishing the height limits is a big step. I think we have made a lot of progress on the FAR discussion. I think we gained a lot of momentum here and I would hate to lose that. One thing I will throw out and I know you don’t like special meetings but we do have next Wednesday open and available. That would be August 7. Commissioner Cassel: But you don’t have all of us I don’t think. Chair Burt: Who would be missing on August 7? Michael would. Is Kathy anticipated to be back? Mr. Emslie: Do we know if Kathy has a planned absence next week or not? Chair Burt: Would we have to make that determination tonight? Ms. Grote: We can follow up with you via phone. Zariah can follow up with you. Ms. Furth: You could continue this to that day and then if you don’t have an adequate number then Zariah can stand here and continue it next time. Page 44 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3O 31 32 33 34 35 36 37 38 39 4o 41 42 43 Chair Burr: If that is okay even though we recognize that first Michael, our final decision is going to be on the 21st so you won’t lose out on it. Our final review of this would be on the 21st so even if we have an interim meeting on the 7th you won’t lose your opt~orttmity to participate in that final. Then tentatively if we can have five Commissioners on the 7t do we wish to try to hold a meeting on that date? Commissioner Holman: I think we need to proceedwith this and if Staff is willing I will certainly make myself available. Commissioner Packer: I am here. Chair Burr: Okay, so basically if Commissioner Schmidt is available and she has reviewed this evening’s meeting and we can have five Commissioners then I am game. Ms. Furth: So you would adjourn this meeting until 7:00 pm on August 7thl Chair Burr: Correct. Ms. Furth: At City Hall, room to be determined. Chair Burr: Correct. Ms. Furth: And the direction to Staff is if it turns out you can’t get five Commissioners here you are going to propose that it should be continued until the 21st. Chair Butt: That would be my recommendation. Yes, it seems to be in agreement with the Commission. Ms. Furth: Fine. Mr. Emslie: Just one quick wrap up that Staffhas committed to bringing back two studies, one is the establishment of the daylight plane for High Street, the west side of High Street and an analysis of the effect of the office restrictions on the FAR that is in the recommendations. We would do a prototype analysis of that and report back. Hopefully we could do that verbally next week with written materials to be distributed and considered for the final action on the 21st. Chair Burt: I just had one quick question for Commissioner Griffin. When you were making that proposal was that a limit on PCs or an entitlement? Commissioner Griffin: PCs. Chair Burt: Okay, thank you. In that case that ends item number two for tonight’s meeting. Page 45 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 MEETINGS ARE CABLECAST LIVE ON GOVERNMENT ACCESS CHANNEL 26 August 7, 2002 ADJOURNED MEETING-7:00 PM City Council Chambers Civic Center, 1st Floor 250 Hamilton Avenue Palo Alto, California 94301 ROLL CALL: Commissioners: Patrick Burt, Chair Phyllis Cassel Karen Holman Bonnie Packer, Vice-Chair Annette Bialson - absent Michael Griffin - absent Kathy Schmidt Staff: Steve Emslie, Planning Director Lisa Grote, Chief Planning Official Wynne Furth, Senior Asst. City Attorney Robin Winkler, Office Specialist Alison Kendall, Consultant Planner Chair Butt: Welcome to the adjourned meeting of August 7, 2002. This is a continuation of our meeting from July 31 st, and the topic of tonight’s discussion is the SOFA II Coordinated Area Plan. Does Staffwish to give us any additional information or follow-up from our last meeting before we continue with our questions and discussion? Steve Emslie, Planning Director: Thank you, Mr. Chair. We have a few brief comments. Just to sum up where the Planning Commission left off last week. The Planning Commission did reach consensus on the height issue as we listed in our matrix as we presented to you last week. We do have a reflection of the Planning Commission’s decision on that and a colored copy of the SOFA II area distributed to at places. We also have an overhead of that should we need to reference that and also have Alison Kendall with our design consultant firm of Freedman, Tung and Bottomley, who can go over any questions that the Commission might have regarding your decision on the height. Where we last left the discussion, the Planning Commission was in the midst of discussing Item #2, the floor area ratio, and discussing the Working Group’s recommendation, the Staff alternatives, as well as the Planning Commission’s own thoughts and ideas on that. We do also have with us this evening as a resource to you, Matt Kowta from Bay Area Economics, who did present the economic analysis and will be able to answer any questions. City of Palo Alto Page I 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 But to summarize where we heard the economic analysis headed is that there were some revisions made to the original economic report based on additional information provided by some SOFA II property owners. That information did not change any of the base recommendation, the recommendations of their economic analysis showed that the 1.5 FAR maintained the highest degree of feasibility even though that there was some erosion of the buffer between the original report and the report as it was revised last week to the Planning Commission. It did show that that was still economically feasible. ’ I should also point out that the economic analysis has not factored in any public’benefits. That the economic analysis, as it was presented, is based on basically an entitlement that did not factor in public benefits. And that’s something that the Planning Commission should take into account as it assesses the FAR, especially as it relates to the PC, no-PC issue. Really the core of the PC is it does add the ability to place public benefits on a project, which conversely would add to the economic conditions and constraints to that site should be taken into account. With that I would turn it over to Alison, who is going to review one of the Planning Commission’s suggestions made last week regarding the daylight plane so you have a presentation on that and some concepts to show you. Chair Burt: I realize I neglected to call the roll at the beginning of the meeting, so just for the record, would the Secretary call the roll? Ms. Winkler: Yes. Chair Burt: And just for the record Commissioner Bialson is not participating in this item because of a conflict of interest with a client. And Commissioner Griffin is a participant. He’s on vacation and plans on reviewing the record of this meeting.and participating at our wrap-up meeting on the subject on August 21st. And Commissioner Schmidt was absent at our lat meeting, and I understand that you’ve had an opportunity to review the records and the tapes and everything. So Commissioner Schmidt is up to speed and will be participating as well. Karen. Commissioner Holman: Did Staff want to respond to, speaking of Commissioner Griffin, did Staff want to respond to Michael’s email question? Chair Butt: Regarding? Commissioner Holman: Regarding economic analysis. Chair Burt: The requirements about economic analysis? Commissioner Holman: Yes. Chair Burr: Steve, do you have any? Commissioner Holman: Do you have a copy? Mr. Emslie: I do. Actually I have a copy of the email as well as your response. City of Palo Alto Page 2 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 Ms. Furth: Commissioner Griffm had a question about what’s the Commission’s make of these economic studies that have been presented to you because that’s a unique feature of this coordinated area plan process. You don’t ordinarily get a city commission economic analysis of land uses, and in particular he was curious as to whether that was really only meant to apply to the Palo Alto Medical Foundation properties in SOFA in the Phase I part of SOFA because they were up for redevelopment and a major focus as the early work on this project was what should become of that land. And the major issue was what is an appropriate and economically rewarding level for the property owners as balance as part of the determination what should be done. My answer is that, no, but yes, it’s something to take into consideration, and no, it’s not entirely focused on the Palo Alto Medical Foundation project. But when the Coordinated Area Plan ordinance was adopted in 1997, the Council said one of its.purposes was, and this is quote, "facilitating physical change by each of the following methods: accelerating and coordinating the planning process, so that people can have streamlined city review processes, encouraging rational private investment by providing specific dependable information about the design requirements, developments, standards, and uses allowed on a particular site, so [finally] more certainty. And then analyzing and considering the economic environment so the planning process works in conjunction with the marketplace rather than independent of it. And finally, coordinating and planning public infrastructure investment facilitating private land uses." And so in this case, of course, there’s the redevelopment of the parks and of the development of the new parks. There’s the [Homer] under-crossing, there’s various traffic commenting. When you, the coordinating area plan document itself has to contain, and this is another quote, "a determination of the economic and fiscal feasibility of the plan with specific analysis of marketplace factors and incentives and disincentives to the desired development product as well as the cost benefit analysis of public infi’astructure investment as a projected economic benefit to the city and community." So these purposes and those requirements apply to the entire SOFA Cap process, not just SOFA I. However, it is also probably useful to keep in mind that when the Council gave it’s charge as to what to do in the SOFA plan, it emphasized redevelopment of the medical foundation sites, not redevelopment of the entire area. So basically the plan must be economically feasible and desirable in order to facilitate the sale of Palo Alto Medical Foundation properties, they said, avoid potential negative impact on vacant and underutilized facilities, so they were worried at the time, strange as this may seem now, that nobody would want to build anythirig on that land. So while it wasn’t anticipated that SOFA would be split into two phases when they did this, and in evaluating the plan against the Council criteria you need to think about the entire SOFA plan, not just SOFA II. So there may be some things that were already done in SOFA I that don’t need to be readdressed in SOFA II. But what you need to decide is what sort of preservation and redevelopment you think SOFA II Cap should encourage in the SOFA II area. And then check your zoning against the economic information to see if you think it’s likely to produce the results you want. So first you decide what you want, and then use the economic analysis to see if you’ve got the appropriate zoning. City of Palo Alto Page 3 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 Chair Butt: Question. In your first couple comments you quoted the Coordinated Area Plan itself I believe. Ms. Furth: The ordinance which set up this process. Chair Burt: And talked about facilitating change and encouraging investment. WaS the wording of that plan area wide? Ms. Furth: That’s just the ordinance for all coordinated area plans, so if you glue it on to Ventura or any other part. That’s the enabling ordinance that set this whole thing up. The only area where the Council asked you to focus on redevelopment specifically in this one was the PAMF property. Chair Burt: Any other questions by commissioners on that subject? Karen. Commissioner Holman: Well maybe just to balance that or ask Wynne’s input on some of the other policies though that do talk about retention of existing scale and all that sort of stuff, and those seem to be in conflict with redevelopment potentially. Ms. Furth: There’s nothing inherently in conflict about redeveloping land and developing the scale. I think it issued a pretty clear directive that you’re not to authorize ten story apartment blocks. But I think it requires integrity in the plan. In other words if you believe that a particular set of zoning standards won’t achieve something, then you should try to be straightforward about that. A lot of this is unknowable because there are so many unpredictable variables. But I think it’s an effort to have a sort of integrity about plans so that if your goal is to achieve something, you’ve tested your proposed zoning against the economic analysis you have. Mr. Emslie: Let me add on to that too, that in the language, the [inaudible] language, I think it anticipated that plan would include more than regulations. That there was a greater public benefit that was anticipated in the plan and the purpose of the economic analysis was to provide an avenue for meeting those suggestions. It may not relate to just simply the people in development getting back to the public benefit discussion that I think people will have later this evening on PCs, so I think in that regard I think that relates very definitely to some of the larger goals that the plan sets out to achieve. Ms. Furth: And the other thing is that we anticipate that the City will spend money, of course the City is spending a lot of money in this area, the creation of a good sized park where there was no park. So the [inaudible] the City is putting money into this area and changing this in some ways and what is the appropriate response to that redevelopment. You’re taking a big chunk of commercial public non-essential use out of it and replace it with parks and primarily residential use. What else is an appropriate response in this area? ¯ Chair Butt: Correct in that we really have three different municipal guidelines, whether they be codes or otherwise. The Coordinated Area Plan Ordinance that guides all coordinated area plans, the specific Council-adopted guidelines, charged for the SOFA area and the [COMP] plan, and those are the three that we’re looking to for gui.dance on all the issues. City of Palo Alto Page 4 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 Ms. Furth: The economic analysis is data for you just like a lot of other kinds of data. Mr. Emslie: Again, keep it in perspective, it’s very difficult to forget in the future that a very volatile economy will continue to be volatile, cycles are going to get shorter and are going to get deeper and the peaks are going to be higher, so consider really a snapshot of where you are today. The general rule of thumb is that economic analyses are generally good for about six months and then they are subject to rethinking of the assumptions. Ms. Furth: And one of the things about this BAE analysis which is interesting is that this is almost all about redevelopment of sites, and so their analysis washes out land acquisition costs. They assume you’ve got the land, now when does it make sense to remove what’s there and do something different or alter the use of an existing structure. So what makes it date is the relative change in the rents that are chargeable for different uses in that area, or the sales prices that can be achieved if you sold something. That’s why the economic analysis will shift as we’ve seen dramatically when there’s been such a variation between residential homes and commercial retail rent and office rents they’ve shifted relatively, but the whole issue of land prices is assumed to be not so important because this is largely redevelopment. You’ve got a piece of land, when would the rationale investor change what’s on it to something else? When it’s an office complex or small office, when should a rational investor change that? When would it be worth it for them to replace that with a larger structure and housing for example. That’s one of the key points, and when you have the answer to that you’ve got to plan development that you think is appropriate. CommissionerHolman: Just one little clarification. While there was consensus by other commissioners, I’m not totally where the current map is in Planning Commission discussion. I have other ways of choosing some of the goals others are looking at as their by-right entitlement. So that’ll come up later, but I just wanted to put that on the record. Chair Burt: Were you referring specifically to the height issue or to other issues? Commissioner Holman: Height and FAR. Chair Burt: Okay. And the only one that I think Steve said on the height you still have concerns with this draft? Commissioner Holman: Yes. Height I’m still where the working group was. Chair Burt: Before we proceed on right where we left off, excuse me, commission members, would you like to ask any additional questions? I know, Phyllis, you mentioned that you have some. We are planning on roughly going through in the sequence that~ Staff had outlined on Attachment A, except that we have really talked about the meeting to intermingle the discussion about the FAR and EC districts at a minimum. Commissioner Cassel: My question, I have a whole series of questions as we go through, and then I have questions at the end I think that are not specifically related to these particular items that have to do with the document as a whole, or specific parts of the documents that are not on this. And they asked me to submit all of these last week, but there was no way. So it’s tonight. City of Palo Alto Page5 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 .38 39 4o 41 42 43 44 45 46 47 48 So as we get through the end, I’ll cross offall the questions we get through and see what I have left, but there’s some in terms of consistencies. Some of them are small like trees, that won’t necessarily be answered, but just need to be answered and directly thought about, why are trees on different centers and things like that. Chair Burr: In that case, where we left off, we had proceeded fairly far along in discussion of FAR. So I might try to frame the issues. We have several aspects to it. We have a question of what the FAR should be in the area that we’ve identified as the transit-oriented development zone, and even within that zone we have scaled down our consensus on the height. I think on this colored map that we have, am I correct that this solid line was identifying essentially a transit-oriented development area, or is it constrained by the 50 foot height? Where had we left off?. Mr. Emslie: We were at the dark yellow 50 foot which basically, with one exception at the substation site, which will be i~acluded into that 50 foot, it still shows the [inaudible] will be corrected, but it’s the block between Alma and then the, on this map, is either southerly frontage of High Street. And then it would drop down at the mid block between Channing and Addison down to the 35, and the Peninsula area would also remain that 35, that would be the area more south of Addison. Then Homer Street would remain at 35 feet and then 50 feet would pick up again mid-block between High and Homer extending north toward downtown. Chair Burr: Yes, and I understand that to be the boundary of what we had tentatively set up as the 50 versus 35 foot height zone with the discussion of even on High Street in the 50.foot zone of having potentially a 15 foot setback from the street face of 35 feet height for the limit on the first 15 feet. But my question was whether that was the same boundary as we were tentatively discussing as the higher density, transit-oriented development for FAR purposes. Mr. Emslie: And we didn’t hear consensus on that. At one point that line has been discussed at the Planning Commission, but we didn’t record a consensus at that point to treat that larger area on the far side of High Street as transit-oriented. Chair Burt: Okay, so one question is: What boundaries do we think are appropriate for what we might call the transit-oriented development zone, whether it be the same as the 50 foot height or something along the lines of what we had previously set up, which was mid-block, I believe, between High and Emerson? Second question would be: What FAR would be appropriate within the TOD area? Third question would be: Is that FAR a base FAR and should PCs be allowed as well, and if so, should there be any FAR limit on PCs? Then we basically have the same three questions for the balance of the SOFA II area: What are the geographic boundaries of the other density zone that we’re discussing? What FAR should be limited in that area? And should there be PCs allowed in that area, and if so should there be FAR limits on those PCs? Bonnie? Commissioner Packer: I think the way you’re phrasing the discussion, there’s a little new slant, and I have to sort of shift my thinking in terms of identifying specific areas as transit-oriented zone areas as opposed to talking about, regardless whether it’s transit-oriented, what density is the FAR, some heights would talking to those areas. It’s a slightly different perspective. I’m not saying I’m opposed to it, but it’s just shifting the question, and I don’t know that we... City of Palo Alto Page 6 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 46 47 48 Chair Burr: We had used that. term before, but if the Commission prefers to use a different description for the two different areas, sub-areas, within the SOFA II area, I don’t have any problem with that. Ms. Furth: One of the things we’ve done just in terms of talking and asking, I realize they get different every week, but in writing about this we called, (by we I mean the planners and the lawyers), we called it theRT35 Area and the RT50 area. If you remember from last week, there’s chunks of this that are actually not in play because they’re big PCs in both the RT35 and the RT50. But the RT50 is the mud-colored, dark yellow, section. Ochre? Sorry. In the ochre section and also that green section. So we had defined that as the RT50 area. You had defined that as the area where you thought larger, or at least taller, structures could go. Then the balance of SOFA II that really is the subject of this discussion because it’s neither R2 nor PC, is then RT35, and that’s all residential transition and refers to all the language in the first chapters of this which talk about the SOFA need to transition from purely residential neighborhoods to mixed use. Chair Burr: Well my recollection and our discussion and what I think I heard Steve say kvhen I asked him the question a minute ago is that when we had had a discussion about what zones should be 50 foot height limit, that was not the same discussion as where we should have an FAR boundary. We may yet decide that those should be the same boundaries, but the Commission had previously, tentatively, put a boundary mid-block between High and Emerson for the higher FAR. And then at the last Commission meeting we had discussed not allowing a 50 foot height on the half block between High Street and the middle of the block of High and Emerson. Phyllis. Commissioner Cassel: I had not presumed, there’s always presumptions going in .your thinking, I had presumed that the higher density Would stay with the RT50, and we hadn’t got that far, but... .Chair Bul~: We have not had that discussion. Commissioner Cassel: Well I Was trying to get into the discussion rather than, at this point. Chair Butt: So why don’t we call it "transit-oriented development" or RT50. I would be reserved at calling it RT50 as the higher density until the Commission has a consensus over whether those boundaries are one and" the same. And so whether you don’t like TOD or you do or whatever, let’s get some way to we’re talking about the higher density zone closest to the transit station. Commissioner Cassel: So starting the discussion, my sense was that the higher density would stay with the RT50. Chair Burt: Other discussion? Bonnie. Commissioner Packer: Yes, I agree, and I have no objection to saying well that’s equivalent to a TOD zone, but I just, as we’re doing this, I don’t think we want to have too many layers of CiO’ of Palo Alto Page 7 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 zones. I think we want to keep it simple so it’s understandable for everyone who’s going to be looking at this final product that we don’t have a zone that’s half in a TOD zone. You see what I mean. Chair Burr: Not exactly. If you’re saying that you clearly think that the height boundary should coincide with the density boundary, then I understand what you’re saying. Commissioner Packer: Yes, that would make sense. Commissioner Schmidt: Along the line of what Bonnie is talking about is if they specifically there’s a proposal that would straddle two height zones, and whether you would want to have it straddling density might be challenging. Chair Butt: Right. Karen, any thoughts? Commissioner Holman: I agree, it could be a challenge. Ms. Furth: To translate you’re saying is that in the 800 block of High Street where there’s presently a proposal in front of the City to develop that as a unified whole, you’re questioning whether having different FAR allocations for different portions of the site would present a problem. Commissioner Cassel" No, we’re talking about what’s being proposed was to put the a higher density on the other side of High Street. Chair Burt: Well, actually but what Wynne is referring to, I believe, is that if you look at the Homer corridor, where that’s part of the 800 High parcel, and we’re having one development that would prospectively be under two different zoning densities. Commissioner Cassel: Right, but that was my understanding. Chair Bu~: But this is what Wyrme is saying is potentially problematic. / Ms Furth: Well, I was asking you if that’s what you were, I was trying to translate what I was hearing. You already have one up in the comer where you have RN30 and PC, that you actually already have an existing, but you know the project on the comer of Ramona and Homer, that condominium project, that is actually built across two districts, a PC district and RN30. It’s all possible, but Steve can talk about whether it’s desirable. ChairBurt: So either way, if we are saying that the height and the zoning requirements would coincide, the height and the density requirements I should say, the FAR requirements in height, would coincide with one another, then we have a separate question of how would that be applied to a parcel such as 800 High or such... Ms. Furth: In 800 High, Ordinarily what, we have more thana few of these, and we would be saying that, you apply FAR on site wide. basis. So if they merged those lots together, they have a 35 foot height limit on the San Francisco end of the parcel, and the FAR would be computed on City of Palo Alto Page 8 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 the size of the whole, and then would allocate it wherever the designers, you said they could do it. Commissioner Packer: But they would have a 35 foot height limit along Homer. Ms. Furth: That’s right. Chair Burr: But they would have a hybrid FAR, blended. I just want to be clear. Commissioner Cassel: One question though, and that is how deep is that 35 foot height when it’s going back onto that walk because I see this as a lot depth, but I’m not sure how deep that lot is. Ms. Furth: It has to be with what your purpose is. Commissioner Cassel: But we’ve got a proposal in front of us that comes with this land, that says that the land along Homer Avenue should be at 35 feet to maintain that view. And if we agree with that, my next question is how deep is that 35 foot line? Is it 15 feet, 25 feet, 100 feet? And I don’t see that’s in it anywhere. Chair Burr: So Alison was saying that, as drawn, it’s 100 feet. So that then presents another question for the Commission: What do we think should be the depth of the 35 foot height restriction alongHomer? Tentatively last meeting, along High.we had discussed a setback allowing only a 35 foot height for the first approximately 15 feet setback from High Street. And then it could step to 50 feet so that we would not have a 50 foot corridor on one side and so that it would have a height that would essentially mirror the opposite side of the street. Mr. Emslie: This might be a good time to go into the daylight plane and what’s the general sense of it. Ms. Kendall: We did do a quick sketch to show some of the considerations for this kind of approach, the concept being as we understood it, to have a kind of a step back at the top of the building plane that would mean that basically you were able to go up at the property line, up to 35 feet, at which point if you had had any taller elements of the building, they would need to step in and could only go up to 50 feet if they were recessed basically 10 feet from the property line. So that’s what we’re showing in this drawing, the kind of building profile you might get with that type of a requirement. And ifI could talk a bit about the pros and cons and the intent of this. I think there are some advantages to using dimensions like 10 feet for these kinds of things. Ten foot is a reasonably usable open space dimension so it would actually produce an outdoor usable terrace that’s not too large and not too narrow, that you can actually put a table and chairs and even some landscaping in that kind of scenario. Fifteen feet is probably about the limit after which it starts to get to be a very large expanse of roof that you’re looking at. Another set of considerations is we didn’t have the time to do the shadow analysis that was referred to. It’s kind of complex given the orientation of the streets and so on. But we did do just a quick diagram here that shows you the concept of site line for pedestrian that’s on the sidewalk on the other side of the street. And I think one of the interests was how can you get the feeling of the building to be essentially three stories rather than four stories in terms of how it’s City of Palo Alto Page 9 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 experienced by the pedestrians. Clearly a pedestrian on this side of the street, actually they’re barely going to sense the height of the building. What they’re really paying attention to there is the bottom floor and then it’s on the amount of detail. But once they were on the other side of the street, they might actually start to perceive the building as being more of a three-story building and a four-story building at about this kind of a setback. And if you look at this line, you see that you would see the very top of the taller portion, but not very much, and it would be considerably recessed. I know their suggestion is just in the interest of not making this too complex to calculate or to deal with, trying to use some sort of standardized angle like 45 degrees rather than something very quirky in terms of defining what kind of a setback you want to have here. So for example 10 feet in, 10 feet up might be one approach that would be easy to calculate. And then you might get something like this kind of a profile. And then one last consideration is that a lot of these types of buildings, particularly if they’re residential, are likely to have at least some setback from the actually property line in order to provide some amount of landscaping, stoops, stair, other kind of mediating space particularly if you’ve got residential space at the ground level. So something to keep in mind is you’re not always going to have the face of the building at the property line, in fact that will be not the general characteristic even though the zoning, the way we talked about it, would generally be to match whateverthe predominant pattem is. So that’s something to realize as well is that this kind of a profile could mean that you have a sheer four-story building technically permitted; it’s just that it would be set in 10 feet for example. And a last consideration is that you don’t really want this to be followed literally and have the same profile be executed on every single building in this area. Nor do you want it executed for an entire block, say on 800 High. So one of the things I would encourage is that you allow some architectural features, gables, trellises, and various other kinds of elements to project into that sacred setback area in order to achieve other architectural objectives like breaking down, breaking up the massing, emphasizing entry ways, things like that. So you don’t want to get a wedding cake profile all around here. Chair Burt: Question. In addition to allowing certain essentially protrusions or whatever, I’d be interested in what language we might incorporate into the plan that would require that the architecture show a variety on that streetscape. Do we have language presently that addresses that issue? Ms..Kendall: Yes, and it’s really most appropriate in the guidelines, but Yes, we definitely do have it. Chair Burt: And any of those guidelines, I guess I’d seek clarification on the strength of the guidelines. Are they adequate as written to achieve the sorts of things that you were describing in terms of wanting to have a varied streetscape in that sense? Ms. Kendall: I think they’re used obviously in combination with the architectural review board process. And I think combined with those they would give you the tools to support that kind of variation. City ofPalo Alto Page 10 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 46 47 48 Chair Bu__.__.g_~: Well then I guess if we already have that in the guidelines, do we need to allow exceptions that would intrude upon the limits, or do We already have verbiage that provides for the variation that we’re seeking. Ms. Kendall: The problem is that if you were to actually set this setback in a development standard, which is on the order of the absolute, you must do it, zoning, and below you actually risk discouraging some of those elements that might actually be desirable. On the other hand, it may be so important to have the predominant feel of the distance be three stories or no more than 35 feet at the front phase, that you want to risk that. Ms. Furt~h: Remember that the way this thing is set up right now, you don’t have any setback. You have a straight face. It’s either 35 feet or 50 feet. And coupled with that you have design standards that essentially indicate that the design review is not going to be approved unless they’ve broken up the face with going back and forth. When you have no setback, then you don’t need something that allows people to intrude into the setback, and there’s basically no setback in this document as it presently stands except for some requirements for landscaping here and there. So if you shfft to something else which has this stepped setback at 35 feet, then you probably would need us to put in language that would allow that. Mr. Emslie: Page 26 of the draft plan, 4.20.3 height it says, that is setbacks that vary the massing of portions of the building are recommended to encourage diversity in design and assist in increasing the access to daylight from the interior of the building. So that’s really the guideline. Ms. Furth: You’ve had this thought for a long time. Chair Butt: Right, so then is the question whether we have to have, or we should allow some additional latitude within this setback that we would prescribe, or does the plan adequately address the requirement. Ms. Furth: If you’re going to have the setback, which you don’t have now, then you will want to, and I hear you saying that you’d like to allow the intrusions into it. Does that make sense? Chair Burt: I’m posing the question, not making recommendations. Mr. Emslie: I picked up on one thing, if you were to establish a setback, I would think you will want to amend to say that you will allow certain production into that area because you have to make reference to that in here. Ms. Furth: Well, if we put it in Chapter 5, that’s clear. Commissioner Schmidt: I think what Wynne was saying is you don’t have setbacks. Ms. Furth: Not now, at the present time, Commissioner Schmidt. And in an urban area, which that is, setbacks on small narrow lots are harder to work with, and if you went commercial down there, it takes away from the sidewalk which generally is not desirable as ..... City of Palo Alto Page 11 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 Mr. Emslie: Just to paraphrase what I hear Wynne saying is that the reason that this height standard works now is that there’s no setback, that you can build right.up to the, there is no need to address encroachment. But if you were to establish one, you need to address that. Chair Butt: That’s what I understood, and that’s the question I wanted to pose to the Commission. Ms. Kendall: Interesting setback. It’s a setback 35 feet up in the air. Commissioner Schmidt: We said, for example, on the 800 High topic, if that were built on this particular map, one end could only be 35 feet high, and the. rest of it could be 50 feet high. Chair Burr: But the question is, as I understand it, and I want to frame the question for the Commission, as I understand it the question is whether we should allow encroachments within that 35 foot setback to give design, flexibility, and a better variety to the streetscape in that setback. Is that what you’re saying? Ms. Kendall: I think the question is first of all do you want to dictate that, that predominant three-story building height, cornice height, and if so in what areas. And it is probably closer to the existing scale of existing buildings than 50 feet, so the first question is that. You’ve articulated some desire, for example, on Homer to have a 35 foot height, and that’s actually being applied across the depths of the parcel. This would give you the feeling of that and allow more density and allow the four story elements that could be desirable, for.example, on High Street, could be desirable on Emerson, depends on the objectives that you have for the area. Commissioner Packer: I think the question that we have to decide first before we decide about encroachment to the setback is whether we want to have in the area, well, in any areas, where we have 50 feet, do we want at the 35 foot height to have a setback of 10 to 15 feet and then have a 50 foot height maximum. Ask the question first and then once you have that, we can say wish we had that, and then allow encroachments of architectural interest. Chair Burt: And all these things are still open for discussion. We have Kathy, who’s participating this time and did not participate last time, but at the last meeting we had had a consensus recommendation for that point. We had made that recommendation to Staff and that’s why this drawing is coming back reflecting that recommendation. But it’s still an open discussion. Commissioner Packer: But the 15 foot setback was all on High, and we didn’t determine how far it wouldbe back along Homer. Chair Butt: Okay, let’s not mix those two issues right now. That is still an issue. I went into this because Alison raised this issue, and I’d like us to zero in on the issue that Alison raised, which is with along High Street, within this zone that we have a 35 foot setback, should we allow some sort of architectural exceptions to create a better architectural design? Commissioner Holman: I have a question that goes before that. I want to know, that 50 feet, is that a typical SOFA sidewalk-street/sidewalk dimension? City of Palo Alto Page 12 1 2 .3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 ,47 48 Ms. Kendall: It’s not. And the SOFA area is very diverse and sort of hard to generalize, but it is the absolute, I won’t say the absolute maximum height, for example, of the building. Commissioner Holman: I’m talking about the street, the sidewalk-street-sidewalk. Ms. Kendall: I think we did scale that off. Chair Burt: Including sidewalks. Commissioner Holman: As it’s shown there. Chair Butt: I think it’s a 36 foot roadway. Ms. Kendall: There are some considerably narrower. Commissioner Holman: That’s helpful to know, and then somebody had said there are other ways to deal with I think what you’re trying to get at. And one of them again on page 26, what Steve read, of the plan, that language could be changed so that it doesn’t address this height, but it could say, "staggered setbacks and heights that vary the massing of portions of the building are required," as opposed to recommended. That would be one way to address it. Then another way to address it would be not allowing any more than, I don’t have a number here, but not allowing any more than X percentage of a building or X amount of frontage to go to the maximum height at the street face. That’s done in some places too. And that gives a balance. Ms. Furth: Both of those things are possible. I will say that when you’re trying to write this so that, there’s a requirement, it’s in Chapter 5 in the zoning so people see it upfront. What you would say in Chapter 4, is that would describe the results you’re trying to achieve, and it would say that it’s recommended you do this, or at someway or another arrive at that’s it. It’s going to require something; we’ll try to put it Chapter 5. Commissioner Holman: It would be moved. I’m saying that’s the language that could be used. Ms. Kendall: For example if you were to carry that idea forward to something like a standard, you might want to say "50 percent of the building facade will not extend beyond 35 feet," or something like that. Commissioner Schmidt: I would not say "required," and you could put recommendations, but it’s just tying your arms behind your back and just creating things that would be miserable to deal with. I would just strongly recommend against saying "required percentages" and "requiring this" and "requiring that." Recommendations have design review. The architectural review board will definitely take care of these things, but I just would not try to, we don’t know what’s going to be there. And to say has to be this percentage or this long, it’s just not a good thing. Commissioner Holman: I think percentages would be difficult especially on the smaller lots. But I know it’s been used pretty successfully in other communities for X amount of frontage in terms of feet. If you have a larger project that’s 300 feet long, and I’m just picking a number, if City of Palo Alto Page 13 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3O 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 you have a project that’s 300 feet long that prohibits all 300 feet from being 50 feet high at the street, it could be say no more than 50 foot intervals, can be 50 feet at the street. And I’m just using numbers here. Commissioner Schmidt: I would still not put numbers on it. I would put recommendation language. Because it’s just too hard to know. Mr. Emslie: They set guidelines right under height. Take a look at that. Chair Butt: And one slight wording change that might still give ARB the latitude to use their architectural discretion, but make it a little stronger than a recommendation, which may be unclear whether it’s a suggestion or a plan guideline, could be just that building mass or facade composition should be articulated as opposed to it’s recommended that it be, and then that should be a little bit firmer language than a recommendation, which might be abandoned wholly or taken as a strong guideline by ARB. So just a thought on how to word that. Commissioner Schmidt: And I would still just say leave flexibility there. It’s not always right to have articulation either, that there are lots of buildings that are simple buildings that we would all like. Can’t give you any good examples, but we’ve got different sized lots. We’ve got a whole variety of things to work with, and I think when you make requirements or shoulds, it’s hamstringing too much. We’ve got guidelines. We’ve got recommendations. We’ve got ARB, and I don’t think we need to control every little thing. Chair Burt: And we do have a question that I’m unclear on is whether this recommendation is applying to each building, or is it applying to the street face? The variety that we’re looking for, is it in every construction project or every segment, or is it the overall street face that we’re looking for variety and articulation? Ms. Furth: The way it’s written right now it implies that on the standard original lots, the 50 foot lots, you’re not not necessarily requiring it. But again, I’m sure there’s going to be a lot of variation depending upon the goal of the building and what’s near it and what the architect have in mind. Commissioner Packer: Now a couple of things. Since we’ve started to talk a little bit about the design guidelines and the development standards and kind of muddied them a little bit, one thing I’d like to point out is the way the draft design guidelines are written in here they sound like development standards because they use the word "should" so often in this draft. And when we were going to get to that, I was going to say that that needs to be looked at. Second, I’d like to say in this discussion we’re supposed to be discussing relationship of FAR and height as a development standard, and we can get back to the softening of these things when we are dealing with the design guidelines, and I have to trust that anybody, any developer, we’re talking probably about residential places, is not going to build a box. They’re going to want to build something that is attractive and that there is going to be this articulation somewhere in all this other stuff. I’d like us to get back to our discussion of the development standards, the "big picture" things, and then we can look at the design guidelines and the details when we get to that part, knowing that we’re going to have some of these areas where we can play around with the aesthetics of it. City of Palo Alto Page 14 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 Then the third thing I’d like to just clarify when we were discussing the zones and the FAR and you said relating the FAR with density. I was thinking residential density, unit density, or relating to height and density. You were talking FAR, so I just want to clarify. Let’s try to say FAR, otherwise we’ll start thinking unit density, which is another issue, Chair Burt: I don’t think any more discussions in that regard have been unit density. We have the discussion of how much, if any, setback should occur at the 35 foot height level along High Street. And Alison had presented a graphic that had shown a 10 foot setback. At our last meeting we had asked Staff to come back with some recommendations on what would be an appropriate setback to have the pedestrian feel along High Street not have a sense of a 50 foot corridor but more of a 35 foot corridor. So the question before us is does this 10 foot setback achieve the objective that we were seeking? Commissioner Packer: Are we talking the east side? Chair Butt: No, no. East side of High is 35. We’re already have a 35 foot height limit on the east side, so there’s no point in discussing the setback at the 35 foot level because we’ve already agreed that there would be a restriction of nothing above 35 feet. So it’s only on what we’re calling the west side of I-Iigh Street. So once again, the question before us is what do we think of the 10 foot setback recommendation? Is that something that we agree with or don’t agree with? Kathy. Commissioner Schmidt: The storage building on the opposite comer of Homer and High, the Beacon’s Building, is 50 feet high?. Mr. Emslie: I think it’s over 50 feet. Chair Butt: And the Alma Place, the SRO, is 50, correct? Mr. Emslie: With architectural projection. Chair Butt: So a little bit above that in some locations. And then the building at the comer of Channing and Alma on the south comer, the PC, that goes up to 50 feet? Okay, so those are the highest buildings I think in that area that exist right now. And actually interestingly, well within the plan area. Interestingly those all go 50 feet directly from the street face. Commissioner Cassel: No. Alma Plaza has a setback. Chair Burt: At the center of it, Yes. Commissioner Cassel: No, it has a setback from the sidewalk because I was there and I was noticing it. So there must be about 5 feet that is setback at an angle. It has some bushes in front of it all along there, so it goes 5 feet back from that sidewalk, or approximately 5 feet back before it starts to go up. And I would suspect from the way this is written that these buildings will not be set on the sidewalk if they’re residential and that tall, that they will probably have something of that nature, 5 feet setback, that will allow for some bushes or something in front of them. That’s the way I read this document. Now maybe I’m reading it wrong, but that we were City of Palo Alto Page 15 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 intending to have in residential buildings some setback with some landscaping in front of that building. So at that point then 15 feet from the property line, which is 10 feet from the street usually, gives you the setback. You’re going to have 5 feet and then the building would have 10 feet, and that would work. And I’m presuming that there will be some setbacks. These tall buildings will be residential buildings, and that they all will have predominantly residents and that they will have something before this actual building on the sidewalk. , Chair Burr: Well then we need a clarification. What we had discussed last week and what Staff and consultants had understood us to mean when we were talking about a setback was that understood to be from the property line or.from the beginning of the building. Ms. Kendall: We defined that as the property line and measured it from the property line, but I did point out I think earlier this evening, the fact that most residential buildings would generally have a zone that’s maybe 5 feet to 10 feet that includes stairs, stoops, landscaping, and various other ramps, whatever. Chair Burr: So if it were 10 feet setback from the property line, and a 5 foot setback from the building, then the visibility of the 50 foot level would be much more apparent from the opposite side of the street. Commissioner Cassel: Right. So if it was 15 feet from the property line, that leaves a 10 foot setback on the building, and that fits exactly what Alison’s talking about and that’s what I was presuming we were talking about last week. Chair Burt: Well it’s not what Alison has drawn, and it’s not what Alison just said that they had understood us to mean. Commissioner Cassel: We need to go back to where we were and keep moving. That was the intent. I thought last week when I was here, was that it would be 15 feet from the property line, and that would give us the setback that we need. Chair Burt: I also understood it to have been 15 feet from the property line, but that is not what Staff has drawn, so we have to evaluate those two options. Ms. Kendall: I think there’s some advantage to going with the 15 feet because what you’re talking about is 15 feet in after which you’re basically stepping down 15 feet from the maximum height, and thus you have a 45 degree angle unless you have simplicity in calculating a daylight plane and working within the zoning that you would have, could build in roof forms and other kinds of elements. So if what you’re looking for is something like having that 5 foot of landscaping and having another 10 foot setback, that is probably what you would get. Realize though that some of these buildings might have commercial space and they might actually be built at the property line and that would be particularly on certain locations, say at the comer of Homer and High, that would probably be what you would desire in terms of maximum for pedestrians. Commissioner Cassel: But there’s nothing wrong with 15 feet. City of Palo Alto Page 16 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 Ms. Kendall: So then you could have a 15 foot setback, and that is particularly about the threshold for where the open space starts to stop feeling like a rooftop terrace and it starts to look like a roof or a garden or something. Commissioner Schmidt: You’re talking about 15 foot of daylight plane, you’re not talking about required setback from the property line. Ms. Kendall: The idea would be to define it as a daylight plane, so you’re going up and then going in at an angle. ~ Commissioner Schmidt: We’d need to give flexibility for a variety of projects, and I would personally probably just let the 50 feet alone, but you could do the daylight plane. We’re still not talking about a huge area that’s got 50 foot height. So it’s a couple of blocks. Ms. Furth: Well I just was going to say that the way the setbacks are written right now, they’re only in residential only buildings, and I.presume that means purely residential projects with no commercial, though it could get a little complicated when you’ve got commercial atone end, and there actually is no defined setback except to say 0 to 10 feet can be designed to conform With predominating existing patterns. I’m a little uncertain, but the architects or the ARB could talk about it. So for commercial buildings or missed use buildings this assumes that it can be as close as at the property line. It can be as close as at the property line, it can start as close as the property line. And I didn’t know whether to read that as 0 to 10 feet being as far back as you could go or just we wouldn’t require more than 10 feet. That’s where you start at the street as it presently exists. Commissioner Holman: Well I appreciate what you’re trying to get to, Pat, because we’re trying to transition to the other side of the street, and if it was stated as a daylight plane issue, I think I would feel more comfortable with that than necessarily a setback. I was thinking maybe it would be helpful to have something in the standards. We have compatibility standards that are a part of this plan, so that’s helpful to know that those exist. And maybe we could add a sentence that just says in the middle of High Street to recognize that it’s a transition from 50 feet on one side of the street to 35 feet on the other side of the street, and let the design take care of that. That’s one other possibility. But I appreciate what you’re trying to get at. Commissioner Packer: When I looked at this and I see the ochre color, if we all look at our map, I see the ochre colors and I see how little is left, that it’s 50 feet which would then be equated with the higher FAR, and then we start chipping away, literally, chipping away at this with the daylight plane in that small area, I see us losing those housing units that we were trying to achieve because this is what we would call transit-oriented development. And I want us to weigh that loss against what we would like to achieve in terms of the aesthetics fi’om the point of view of the pedestrians across the street versus the loss of some housing units for teachers and police officers and that kind of thing. I just want us to put that in perspective. Because we have so much area that’s at 35 and Homer is protected with the 35 foot height, I’m less inclined to further chip away at that area that we’ve up to now had kind of a consensus as 50 feet. If we don’t, and the consensus of the commission is to have this daylight plane, then my recommendation would be to go back to the 50 feet on the east side of High Street with its City of Palo Alto Page 17 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 ~17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 daylight plane. So that we can give some opportunity for greater housing units. That’s my personal goal in the SOFA CAP. Chair Burt: Well first I’d like to point out it’s not merely an aesthetic issue. This is a Comp. Plan guideline where our transitions are supposed to be at mid-block not at mid-street. And so that was the basis for that thinking. Second, while I am supportive of greater residential density in this area, we don’t have anything on the table that these housing units would be teachers and police, and so I think we ought to keep off the table things that are not part of any proposal in our considerations in my opinion. At the last meeting, and we discussed where that boundary zone should be on the 50 foot height, and I was comfortable with either mid-block between High and Emerson, or if we were going to have it at High Street, then to achieve something that gave a sense so that we wouldn’t have one side of the street 50 feet and the other side of the street 35. But at that last meeting you had gone along with this proposal, so if we want to reconsider it, then let’s toss it back out. That was an item that at the beginning Steve had indicated that the Commission had achieved consensus on with the exception that Commissioner Holman was concerned about whether that was excessive in height. The rest of the commissioners had supported it. So if we want to go backwards and reconsider the boundaries of the height, .if the Commission wants to do that, then we should do it, but we should try and do it as expeditiously as possible. Commissioner Holman: Well I want to just state that my objection was not strictly to the height. It was because putting that kind of height and density pressures on places like [Reach] and Watercourse Way, is really going to probably cause the loss of those services to the community, and that was a pressure I didn’t think those businesses needed. Chair Burt: What’s the sense of the Commission on whether we should leave the height as we had discussed last meeting. Commissioner Cassel: I think we should leave the height as we discussed last meeting. I think we need this setback because of the two sides needing to have some approximation and the feeling of being 35 height, and we need some density on that side of the street to help us work with transit-oriented. It won’t give us as much density, and I’m aware of that, but I think it’s very important, I frankly think we will get more out of the business community if we can make our units fit more comfortably. People need to feel comfortable about where people are. They keep saying I don’t want all these people, but I don’t think it’s the people, I think it’s the mass, and I think it’s the number of cars we have. We need to find ways to make our community feel comfortable and this is one of the ways to do it. Chair Burt: I agree. I think that the advantage of a daylight plane setback would be to have greater community receptivity to actually achieve the very thing that you would like to achieve, Bonnie, which is having some additional residential density there. But I think we need to look for ways to balance the concerns of the neighbors in the community with that broader city-wide objective. And so I would support doing it in a way that Kathy had talked about, which is with the daylight plane concept as opposed to a specified setback. City of Palo Alto Page 18 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 Commissioner Schmidt: I probably really [inaudible] I think that a daylight plane is acceptable to have a transition as I definitely believe in the density as we’ve said many times before. This is the location in town where we have the opportunity to have transit-oriented development, higher density, and we should take as much advantage as we can and limiting it, but we definitely need to think about the big picture there too. So I think the daylight plane would be okay. Commissioner Packer: And, I said my piece, but I’I1 go along with the consensus for all the good reasons that Phyllis and Kathy and you say. Chair Bun: So do we have a consensus to recommend that utilization of the daylight plane concept to achieve this setback with the objective being that along High Street the pedestrian would have the sense of a 35 foot building in their viewscape? ¯ AI__!I: Yes. Mr. Emslie: So it would be not a specified setback but a daylight plane at 45 degrees beginning at 35 feet in height along High Street frontage. Chair Burt: Just a question, in our residential daylight plane requirements we have certain allowances for protrusions, right? Mr. Emslie: Yes. Maybe just to speed things along, why don’t we take a look at, as we put the final document together, include language similar to the R1 in this and see how you like it, and then we can take a look at it, so we don’t have to necessarily wordsmith it tonight. We’ll just put something together. Chair Burt: Very good. Now before we move specifically to the FAR again, I would like to have us discuss the other half of the street face setback issue which is along Homer. And Phyllis had raised the issue of how far back that setback is. Alison had indicated it’s approximately 100 feet. Is that what the commission wishes to concur with. Commissioner Cassel: I had two other questions of clarification. On this map it does not show as a start the site at the comer of Alma and Homer, the north side. Ms. Furth: The map is out of date. Chair Burt: Robin, if you’re making copies, can we also get copies of Wynne’s response on the economic guidelines? Ms. Furth: The map only shows certain National Register and other historically significant things. Phyllis, you had another question for clarification? Commissioner Cassel: Well I presume the one at the comer at High and Homer on the north side is not historical. Commissioner Holman: If you’re talking about the northwest comer of Homer and High, yes it is. City of Palo Alto Page 19 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 Ms. Furth: It is true that there are many layers of regulation in this plan because you have a standard requirement on all the historic structures. Commissioner Holman: I was going to say that it’s always been considered I think that the 35 foot height would be lot deep, and I think maybe where you’re going, Phyllis, is that a vast majority of these properties are historic and so probably wouldn’t be able to go, given the size of the parcels, probably wouldn’t be able to bust through the 35 foot much anyway. And one exception to that would be Whole Foods, which isn’t an historic building, but it’s already so developed that that’s probably not going to change. So I don’t think it’s going to affect very much if it’s a parcel deep at 35 feet on Homer. Commissioner Cassel: The other concem I had was between High and Alma. We’re showing it 100 feet, and I just wanted to make sure we’re clear that that was what it would be. ,Chair Burt: Well what I’d like the Commission to address is do we think 1 O0 feet is appropriate and what we would like to see achieved there. Commissioner Holman: Well I’d rather not put a number of feet to it, but parcel deep because some of them may be 100 feet, some of them may be 80 feet, some of them might be 110. Chair Butt: So you’re saying that the entire parcel should have a 35 foot height limit. I’m raising the question: Along that section are we looking to achieve a continuity of that 35 foot height that we have along Homer extending out to Ramona Street, or is the concept of a daylight plane setback what we think is most appropriate? Commissioner Cassel: I’m comfortable with what’s here, but I just want to make sure because that question had come up. Commissioner Schmidt: Well I’m not clear at this point whether it’s 100 feet or parcel deep. Ms. Furth: It should be parcel deep because I don’t know the exact number, but they’re both the same size. Chair Burt: Is it our understanding that itis parcel deep? Ms. Kendall: The parcel line is not completely stable at 100 feet, but it is very, very close to that. I believe that that dimension hooks up on Ollie’s lot and it’s about 100 feet. Chair Burt: Well on 800 High for instance. Ms. Kendall: On High, you’re right. Commissioner Holman: It’s currently three parcels though, so whatever the first parcel is. Ms. Kendall: I think it would actually be easier to just bind it as a certain dimension, but we could jog it. City of Palo Alto Page 20 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 Commissioner Packer: I can see the 35 foot deep from High Street east on Homer, but west from High Street, that between High and Alma, I wonder if we wouldn’t want to consider making that part, making it all 50 feet so that the whole block is 50 feet, but have that daylight plane on the Homer side. Ms. Kendall: Just so we’re talking about those two parcels on either side of the alley between High and Alma on the Mountain View side of Homer. Commissioner Packer: If we wanted to extend the ochre there, and have that daylight plane that we talked about for High Street going around the comer. We’ve heard about some development ideas and the City wanting to develop that, it might be easier to just work with that whole block. Commissioner Cassel: The only reason I didn’t want to do that, one was matching side to side and the other side where there are historic buildings already, you’re not going to want to pull that 50 foot out into that. Commissioner Holman: But you have a daylight plane. Commissioner Schmidt: But with the daylight plane you’re going to put feeling at the street. Commissioner Cassel: Here you;re looking down the street, but you’ve already got it blocked by a large building.~ You’ve got the storage building and other things. It’s just that these historic buildings, we need to try to keep those buildings. Commissioner Packer: But it’s just on that edge and it’s consistent with the concept that you raised last week, Phyllis, of stepping down towards Ramona Street, ~so the Alma/High Street area or High area, but with the daylight plane on the Homer thing, the minutes are not going to pick up my hands waving around. But my hands are waving around to show that daylight time is a 35 feet maybe on either side of Homer, well you don’t need it on the north side of Homer. Chair Burt: I certainly support the concept of having that Homer corridor having, at the street face, not having a 50 foot height limit. We do have the Beacon’s Building that right now is maybe above 50 feet that blocks that continuity of a visual corridor there on the north side. I’m not sure that it’s necessary to have an entire parcel go back at 35 feet. I’m less comfortable with whether the simple daylight plane we had proposed for High would be adequate on Homer. And so maybe some greater setback along Homer, a greater setback along Homer than what we’ve established for High would be appropriate on Homer, but I don’t know if it would have to be 100 feet or the entire parcel. So I guess I’m kind of tossing that out as a possible compromise. Mr. Emslie: Forty or 50 feet? Chair Burt: Yes. And maybe what we should do again is encourage Staff to return to us with a proposal that would reflect the concept, and so rather than try to define a limit, what do we think conceptually about should the parcels along Homer, between Alma and High Street, should the entire parcel be limited to 35 feet? That would be one alternative. City of Palo Alto Page 21 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 .48 Another alternative would be to have it nearer what we have proposed for along the west side of High Street. And a third alternative would be somewhere in-betweel~ those two. What does the Commission think about those three options or others that commissioners have a fourth idea? Commissioner Holman: Well I think you’re just not going to gain much by doing greater daylight plane setbacks and trying to go to 50 feet there. I just don’t think there’s that much to be gained to try to manipulate it. Commissioner Schmidt: So what are you suggesting, Karen? Commissioner Holman: To just leave it at 35 feet the way it is now. Commissioner Schmidt: I would be comfortable with what Bonnie suggested of the daylight plane coming around the comer and giving the 35 foot facade along Homer. Chair Burr: And I would be comfortable with something less than the entire lot set back for less than 100 feet, however which way you define it. I’m open to consideration either essentially half a lot, 50 feet, or perhaps even nearing what we have on High. So we kind of have a split commission at this moment on the subject. Three of us are open to something allowing greater height intrusion than what is currently on this map. Commissioner Cassel: I don’t have problems with that, but I do have,problems with it only being 10 feet, and I really have a sense that we need more visual coming down the street. Chair Burt: I’m close to you on that subject, so what if we were to tentatively, and we’re going to have our final recommendations that we will making at the next meeting. We’re talking tonight about what to request that Staff put down as proposals for us to vote on at the next meeting. And that would include Michael at that time. So let me toss this out as just for purposes of Staff, what they should retum to us and put as a proposal out. We could do a compromise proposal to allow staffto come back with something. Steve, what do you think? Mr. Emslie: You don’t want to do that. I think you want us to model it is simply what you want us to do. You’re concerned about the corridor effect. It’s a different environment than High Street because you’re talking mid-block. You’re talking about a narrower view and looking down the street. That’s a different viewpoint that has to be taken into account. What I hear you saying is that you think 100 feet is too much, but 50 is, you’re not sure whether that’s going to achieve the desired results. So now what we need to do is to do a similar study on that end, how that would relate to the corridor effect. We can do that for your next meeting and propose something in language and have graphics to allow you to fully appreciate the consequences of that. Chair Burt: Okay, so rather than us recommend a specific amount, how does it sound if we let Staff and the consultant come back with a model that we respond to? Ms. Furth: When you’re doing this [inaudible] there is a fine-grained planning like this, it’s very valuable to do what you’ve been doing up in the High Street discussion. Explain what your goal City of Palo Alto Page 22 ! 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 is and then have Stafftell you how they think you can achieve it so that the rational basis for your discussion’s apparent and that’s why I’m glad you decided to have Stafftell you how to achieve the results you want rather than picking a number because that can seem very arbitrary if you’re the owner of that parcel. Mr. Emslie: So essentially Staff will prepare a model to minimize the corridor effect on Homer Street. Commissioner Holman: So can I get clarification then, are we talking about all 0fHomer? I thought we were just talking about Homer between High and Alma. Mr. Emslie: Homer between High and Alma. Ms. Furth: So the other part of that being that the RT50 extends now all the way across with that modification. Chair Burr: And the decision would be made with a full participating commission at the next meeting. This is only for purposes of what we will see a model from Staff to reflect the concept. Then I think that has completed our discussion for tonight on the height aspect, and let’s return to the FAR issue. If I might propose it that we initially discuss the FAR in the RT50 zone, and then discuss FARs in the balance of the Phase II area. And so we would have a question of what should be the base FAR. Excuse me. One of the things I did not frame earlier is a question of is it an FAR that is for residential versus a mixed-use FAR or for residential with a small retail commercial element. But basically the question of should the higher FAR apply to a project that is overwhelmingly residential with some small retail component, or does that FAR apply to a mixed-use commercial residential project that would be constrained under the limits of commercial as defined elsewhere in the plan. Ms. Furth: When we were trying to sort this out we wanted to know from you what’s the FAR for a purely residential property, and then there’s the issue of what’s the FAR for a purely commercial project. Chair Burt: Purely commercial, or you mean mixed use? Ms. Furth: Purely commercial. And then the third one is, and you might need to, maybe you want to split that, and the third one is what’s your feeling on FAR for a mixed-use project. But the two simpler cases are purely residential, purely commercial. Chair Burr: Yes, the purely commercial I don’t really think has been much in the discussion because the alternatives have been generally mixed use and residential. Ms. Furth: What is the FAR for a pure [office budget]? Mr. Emslie: Point 4. City of Palo Alto Page 23 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3O 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 Chair Burt: So really the issue is a mixed-use commercial/residential, versus what you’re framing as a purely residential, but what I understand to be an overwhelmingly residential with a small retail-commercial component. Ms. Furth: The way this is written, mixed use is not required. The property owner has a right to build a purely residential project, so we need to know what the FAR is for that project. Commissioner Packer: Why couldn’t they be the same? Ms. Furth: They can be whatever you want, I just needed to fill in that blank on the grid. Commissioner Holman: For simplicity’s sake I think we could make this really difficult if we had different FARs for this and that. And this is where I think it’s really difficult not to talk about TDRs and PCs and all that sort of stuff kind of wrapped together because that’s going to affect what our ultimate FAR is. Chair Burt: Well that was the other part of what I thought we should have as a discussion, which is, is this an allowed FAR, by right, and if so, should a PC be allowed and should there be a limit on the FAR to a PC in this area, and if so, how much? Ms. Furth: And there’s a third issue which is you can havethe as of right, which is very helpful to know as a starting place. And then you could have a discretionary project and there are a lot of different ways to do a discretionary project. The third one is would there be, as there is downtown, a notion that you have an as of right FAR and then a ceiling above that which you could go to if you’re transferring development rights from other historical sites. Remember where the transfer of development fight as a right or your own bonus on your own site. But we could probably talk about those later. You have the other issue existing building which are already over the FAR as you’re proposing. Chair Butt: But part of this discussion I think should be whether there is a absolute cap on the FAR, whether it be through PC or some other discretionary form or TDRs or any of it. Part of the discussion needs to be is there a maximum FAR above which you cannot go with TDRs or PCs or whatever. Commissioner Holman: Just to start it out, I’m close to where the Staff is, of a 1.15 FAR as a base and anything above that you earn in one fashion or another. Commissioner Packer: I have a question. We talked earlier about tying an FAR with the height, and having a different FAR with a different height. I want to know~ is there some kind of formula? If you had the same FAR for both heights, then you’d get a denser building in the shorter places, and I don’t think we want to achieve that. So I want to know what percentage difference in FAR do you go when you go from 50 to 35 to get an equivalent... Chair Burt: Density. Commissioner Packer: Yes. City of Palo Alto Page 24 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3O 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 Chair Burr: As I understand Bonnie’s question, what would be approximately result in equivalent we’re saying density, the equivalent mass if we were in a 35 foot height limit versus a 50 .foot height limit, what would be the appropriate proportionate FARs for each of those limits? And I think that’s what Bonnie’s trying to get at. Commissioner Packer: Otherwise we may end up with very airy development here in terms of- and that’s not what we wanted to have. Ms. Kendall: Think of 35 foot as roughly three stories of residential [inaudible] height, three stories as three stories of residential or possibly two stories of residential over a commercial base which is a little taller. That’s about right. The 50 foot limit would then bring you up another story if you were developing as a block a building that was just a chunk of cake or whatever, you would essentially be able to get a fourth story or go up 25 percent, or 33 of the previous amount. Now I think generally as you go up to that fourth floor you generally don’t want to be a solid block, so I think that’s something to keep in mind, that although you want to allow some use of that fourth floor, you really don’t expect it to be as uniformly developed as the bottom three stories. So I guess, in other words, if you had an FAR of say 1.15, that’s not a very easy number to work with, but let’s say it was. 1.5 because it’s easier to calculate, every little floor that you think of as .5 FAR if you were distributing the [butter] for the siding, on the top floor you might want to not give quite so much butter to. You might want to go up all the way to 2.0, you might want to go to a number that was less than that as you build out a 50 foot height. You would certainly want something between I would say at least half of that difference in order for it to be significant in terms of actually building type, program type, and economic feasibility and so on. So I guess that’s a way to think about it. I’m sorry I can’t do it quite as readily with 1.15, but with a calculator it might be easier. Chair Burr: It still goes back to there’s going to be a certain proportionality, and that’s what we’re going to end up seeking. Ms. Kendall:. That’s about a third more, up to a third more, a quarter to a third more. Commissioner Packer: So one could think of let’s say, just throwing these numbers out, in the 35 height zone, 1.15, and then in the 50 foot zone, 1.5. That would be kind of a reasonable relationship, and maybe that’s something that we .... Chair Burt: Well I think it will warrant further discussion. Maybe at this point in time we say there’ll be a proportionality to the height, and let’s try to defer fine-tuning what that proportionality is. Mr. Emslie: Just a little word of caution here. You can really try to refine the FAR and try to get a proportionality, but there are a lot of other factors besides that that are going to dramatically effect what can be built, especially as you get into the smaller RT35 area, smaller lots because it’s really all driven by parking. You can’t get anything over one FAR unless you put underground parking in, and unless you can make underground parking work, it’s academic what the FAR is for that site. City of Palo Alto Page 25 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 Ms. Furth: There is one exception to that, I can see Steve glaring down the table, but there are two, since you’re down to a fairly fine grained stuff, you’ve got two lots, remember, that are in the parking assessment district. They can do off site parking. Mr. Emslie: Good point. Ms. Furth: So when you’re looking at these two, those are in the parking zone. Chair Burr: I’d like to toss back out on the table something that I brought up at the last meeting, and that is that I think that we should not have the same FAR for an all residential project as for mixed use. And if one of our primary reasons for encouraging additional housing here is to address the jobs/housing imbalance, then to the extent that we allow additional office/commercial in this area beyond what’s been built the last four years, which has largely taken over this area, or at.least all the redevelopment that’s occurred has been virtually entirely office, I would like us to actually reduce the allowable office/commercial in the mixed use from the Staff working group proposal of .4 FAR down to a .25, and have a proportionately higher allowable all residential project. And not only address the jobs/housing imbalance, but simultaneously create the incentive to build residential from here on rather than.to build office. Commissioner Cassel: Well, I’ll give you a different reason for not doing that, and that is that we’re supposed to maintain the character of this neighborhood and that is to have some commercial in that retail area, and if you severely limit that, and you’re not going to have a lot of building goingon, it’s not like you’re redoing this whole neighborhood, you’re stimulating the area to lose some of that retail. Chair Burt: No. The proposal would not affect the allowable retail. It would affect the allowable office. The retail/commercial would still be allowed. We have aspects in the guidelines that constrain within that .25 they can’t have ground floor office different areas and Staff can clarify that. But my objective would be to not set up a limit that would constrain or discourage the ground floor retailer. Very definitely I would not do that, and Staff could formulate it in a way that it would not do what you’re worried about. Commissioner Cassel" Because at that point we’re back on this other question about whether we should be dividing the commercial and the realtors and people in the area who live in the business area saying please don’t make that too narrow because that’s just going to be very hard to fill when we have a lot of retail uses, fine. Chair Burr: Well that’s a sub issue. Commissioner Packer: But you are talking about only commercial. Chair Burt: What my objective is, this is new buildings, and to further constrain office/commercial. Commissioner Cassel: Give me a size that you’re going to end up with on these pieces of property for only commercial. What size space are you going to give them? Because what’s in here, 2500 square feet, or .4 of the project, whichever is larger, based, I presume, on the size that 2500 square feet is a reasonable sized space. City of Palo ~4lto Page 26 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 46 47 48 Chair Burt: My understanding, and maybe Steve can expand upon it, if we had a .25 FAR commercial limit and do not alter, for the most part, the other aspects of what’s in the plan, it’s really not as great of a change as it sounds because most of these properties could not build a .40 ¯ commercial based upon the constraints on how much of that can be office and how much retail. Steve, could you explain that a little bit? Mr. Emslie: Yes, there’s maximum limits in terms of the size of the non-residential [lists]. Maybe for this purpose it would be better if we were to talk in terms of retail and then office, and then we’ll sort them out later. But for non-residential right now there is a 5,000 square foot limit, so even if you hit the 40 percent FAR, you would be limited by that overall cap. In a lot of instances you wouldn’t be able to fully implement your full FAR because of that cap. Commissioner Cassel: I’m more worried about the other end of it, but that raises a question that I had and that is some pieces of property are large and some small, and yet we’re using a number limit, and that means that a person who owns a large piece of property is constrained in a different way than a person who owns a small piece of property. That doesn’t seem to make sense. Ms. Furth: Well that’s because, remember that the origin of those 5,000 square foot or 2500 square foot limits was this notion that smaller offices were more desirable than larger offices, and in part it’s aproxy for neighborhood serving.. It’s been more or less successful in different points in the economic life of Palo Alto, but if you go back and look at the CM and the CS districts or CD districts where its done, and the size of the office that they allowed after we went through that... Commissioner Cassel: But you can make the offices 25, but you may have three of them if you have a very large piece of property. Ms. Furth: No, this is the limit on the curb per site. Commissioner Cassel: That’s what I’m trying to get clarified. Is per site, does it make any difference whether it’s a big site or a little site? Ms. Furth: Well you can also get what happens in SOFA, which is you have a single business occupying a number of different sites, just walk between the offices outdoors. Commissioner Packer: I just want to go back. Maybe what we need to see if we agree with Pat’s concept that we want to see whether we want to limit the amount of office/commercial in a particular project, not discourage ground floor retail, and encourage multi-family residence, how we do it exactly with the numbers we may want to, as we dealt with the other thing, go back to Staff and say what makes sense given a large site and a small site. And so that we don’t pick some arbitrary number out that is going to create lack of flexibility problems for the property owners that we heard about last week. And it’s something that reflects our goals, see if we have consensus about the goals, and get some feedback, an explanation, some kind of grid that says whether we like the 5,000 square foot cap, maybe we want to change that. Maybe we want another cap if we want any cap at all. City of Palo Alto "Page 2 7 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 Commissioner Cassel: I guess my problem is we have a group of people working together who supposedly came up to some compromises on these issues, and I presume that they did some of this arguing. Am I wrong? Chair Butt: But Phyllis that’s the working group, and we’re the Planning Commission. Commissioner Cassel: I understand that, but when a group spends two years doing it, I presume they’ve done some work that talks about it. Maybe I’m completely wrong, whether this is a reasonable size, whether it works, and they talk to business owners and they’ve talked to other people. I just didn’t expect to be starting from scratch on it. Chair Burt: Well we aren’t starting from scratch, but we are looking at each of the things that we’re discussing. We have been looking at whether we agree with the working group recommendation or have our own recommendations. And what I had stated at the last Planning Commission meeting, I do not think that the working group discussed the option of further reducing the office. Karen was a member, and my sense is that the working group would probably be supportive of further constraints on office. Whether they would be supportive of additional allowable FARs on residential is less likely. Karen. Commissioner Holman: Well, we did discuss the reduction of office because we said, and before I do that I want to go to one, I just want to make sure that everybody is talking about the same thing. When we’re talking about retail we know we’re talking about retail plus personal service, plus neighborhood serving business. I just want to make sure we’re all talking.about the same thing. And when we’re talking about office we’re talking about general office. Just want to make sure we’re all on the same page with this. So that’s one thing. I agree with your comments, Phyllis, the working group did discuss this, and the working group did put constraints on office. They said no more, (I was trying to find it and I’m not finding it right at this moment), but there’s certainly no more general office on Homer, on grotmd floor on Homer and Emerson, and I believe it went so far as to say no more new office south of Homer. So that certainly is constraining it. And it allows the existing offices to stay. I would recommend that, some people were talking about they want the flexibility, so I would actually add somethifig so that we don’t have an unintended consequences, to allow the people who have existing offices as of, pick a date, June 2002, to let them flip back and forth to retail or whatever. That gives them the flexibility. It keeps the community from being deprived of retail use just because they’re afraid they can’t go back to office at some point in time. And it doesn’t exacerbate the extent of office in the area. Mr. Emslie: That was a very significant point in the economic analysis about the disincentive to try retail. Staff would be very supportive of moving in that direction to remove the artificial barriers to trying retail, especially in an emerging area where there’s a lot of uncertainty as to whether or not it’s going to take hold or not. So I think that would be something we would love to work on. Commissioner Holman: And I gave a whole laundry list last week of the reasons why general office doesn’t serve this area. It displaces housing. It displaces the retail that we’re looking for. I mean there’s a whole laundry list of reasons why we don’t need more new office. City of Palo Alto Page 28 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 Ms. Furth: There’s one more thing that Patrick can put into this already complex situation, which is remember that the City Council subsequently in the middle of all this process passed its retail preservation ordinance, and that retail preservation ordinance prohibits ground floor use of either residential or vague definition "retail service space" to office city-wide including here. So ¯ that’s the regulation right now. Commissioner Holman: But we would have to pass something here because this is a cap. Ms. Furth: Whatever you do here will amend that present situation. Mr. Emslie: What I’hear Wynne saying is you can leave it the way it is and nothing gets to convert. Ms. Furth: If you incorporate that into the cap. Commissioner Holman: If you incorporate it into the cap, yes. But that’s ground floor too. Ms. Furth: That’s right. But one of the things I wanted you to keep in mind was that right now ground floor, non-office uses can’t convert to office. That’s a city-wide regulation. It applies here. One of the recommendations you need to make is should that become a permanent rule. Commissioner Holman: And I believe there’s one other piece of that. I think housing though could convert to another... Ms. Furth: It affects housing too. Commissioner Holman: I just couldn’t remember if that got added or not. Ms. Furth: It did. They instructed as a change. Chair Burt: And Karen brought up the point which we had heard from some of the small property owners that currently have ground floor office that without the flexibility to try retail and the option to eventually return to office, they would be discouraged from ever trying retail because they would permanently relinquish their prerogative to return to office. Commissioner Cassel: So there’s two pieces to this, fight? Your trying to suggest that we should actually restrict offices inthe smaller sizes than what they’re being proposed, and then the other is but there are some people who would like, and it’s a slightly different take on that, the flexibility to be either retail or office in areas that are existing office. Chair Burt: That’s existing. And I’m referring to new construction and further restricting it, although if you really look at what is allowed under the ways that Karen was describing and Steve as to the plan, what I’m proposing ona .25 FAR commercial limit, with the other restrictions then in a plan, is virtually what we have right now. Commissioner Cassel: Then why are you proposing the difference? City of Palo Alto Page 29 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 Chair Burr: To essentially those circumstances where someone could build a .4 FAR commercial, that I believe that we, in this plan area, have already more than achieved the office portion of the mixed use objective for this plan. Overthe last four years, we had a concept of wanting a mixed use area for this plan, and that’s mixed use, commercial office, and retail, and residential. And what we have right now is an area that over the last four years almost all the redevelopment that has occurred has been conversion office. I think we need very little additional office in this area, and I would like to do as much as we can to have the balance of the redevelopment that occurs over the next ten years to be overwhelmingly residential while supporting retail retention. Commissioner Holman: I’m confused as I was last week. If that is the goal, I truly am confused. Why not just say no more new office, allow all the existing offices to stay. The other thing that does is when economies swing, and we know that they do, they go through cycles, general office brings a higher rate. And so if you don’t allow more new office, then you also make the other office space that is available, the architects and that sort of thing, (not meaning to pander to you, I just realized), but it makes that space more affordable, and so you get that eclectic and those services, you foster them. Chair Butt: So in answer to your question I think ideally I would prefer the alternative that you suggested last meeting, which is no additional new office, but I had my proposal as something that I think would result in less of a strong objection from property owners in the area and have a greater chance ofactually ultimately having Council support. And that was the reason that I didn’t go as far as your suggesting of no new office. My personal preference would be that, but my proposal was to be more aggressive than the working group proposal on restricting office, but have it still be something that hope.fully would be an acceptable compromise for all of the stakeholders. Commissioner Packer: You’re convincing me that it doesn’t sound like such a bad idea, Pat, your idea. I just don’t know if the .25, I’d just like to see what that produces in terms of numbers, there’s no final until I see whether it becomes overly restrictive in a certain situation. It’s the only thing I’d be concerned about. Commissioner Cassel: Well it does on a 5,000 square foot lot, you’re allowing someone 1,250 square feet, Yes, or .24 of general office, rather than allowing them .4, which is close to 2,500. Chair Burt: Well the other thing we could do, as Bonnie had suggested, is we could, if we have a concept that we support tonight, allow Staffto come back with a better thought and crafted proposal to reflect the concept, rather than us try to specify a FAR on the office commercial. Ms. Furth: What was Bonnie’s suggestion? Chair Burr: And I would feel comfortable with that as well. I don’t think there’s anything magical about my proposal. I wanted to put something out on the table that would be reflective of the concept. The concept is that we would like to see an even greater incentive toward residential and less allowable office commercial than the working group proposal. Does that reflect what the concept is? And while retaining strong support for retail. City of Palo Alto Page 30 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3O 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 Ms. Furth: So less office, pro broad definition retail. Chair Butt: Yes. Less office, more residential support retail. Ms. Furth: And in terms of the existing of~ees they could put to retail and preserve their right to go back to office. Commissioner Holman: And do we need to pick a date? Ms. Furth: No. To retail and back. And what about the existing ground floor retail housing conservation ordinance taking place right now? Chair Butt: Support the city-wide? Ms. Furth: So for example Whole Foods cannot switch to office. Chair Burt: Kathy, what do you think? It’s okay? Commissioner Packer: And one other little other thing, not too little. In the zoning ordinance update we’re talking about definitions, and office and retail you have those definitions are a mess. .Ms. Furth: They are in SOFA also. Commissioner Packer: Yes, I know because they’re the same definitions. So hopefully we can link down the road that there be some kind of connecting thing in the SOFA cap that we can look as the zoning ordinance is updated with their definitions. Ms. Furth: One of the things that we’ve been going to do is to take this draft and convert it into the new ordinance format which we have done and you’ll see it the next time you look at this, and this contains definitions in its own section because we know that the code is going to change, we don’t want to [corporate] by reference. So I know there is some effort being made to clean up those definitions, which don’t have to be as comprehensive when you’re only dealing with nine blocks as they do when you’re dealing with the entire city. And we thought this might be a field trial of some of those sharper definitions. Commissioner Packer: There’s some uses that are defined as office uses, which to me, and it’s not like retail, like travel agents. Chair Burt: And Karen has expanded on these are not purely retail. These are business service. Commissioner Packer: Personal service. Ms. Furth: This is the struggle of trying to define neighborhood-serving things, and we made a real run at it in midtown and maybe there’ll be something better here. Chair Burt: Why don’t we take a break at this time. We’re five minutes after nine. City of Palo Alto Page 31 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 Commissioner Holman: I’d like to finish up two little things about this. One is regarding the ground floor ordinance. There is one aspect of that that I think we might want to, an additional aspect that we might want to add to this area. And that is, because it is a mixed-use area, the charge is to recognize it’s a mixed-use area, that housing would not at the ground floor replace retail. That’s one thing. That’s the whole area to my way of thinking. Housing is additional. We’re building on the mixed-use aspect. That would be my suggestion. Chair Butt: But isn’t that already in the city-wide ordinance? Ms. Furth: No, the city-wide ordinance is really directed at preserving housing and services and retail from offices. Chair Butt: So currently housing could replace retail. Ms. Furth: You can switch housing and retail back and forth. Commissioner Packer: So in other words let’s say, give an example, Ollie’s Place, which is retail I guess. Chair Burt: Well, business service. Ms. Furth: It’s not office, is what we said. Commissioner Packer: But that could convert to housing. Ms. Furt~h: Above the first floor. Commissioner Holman: So it would be a mixed-use project. Ms. Furth: I don’t know what their square footage is on that site. Basically what it says is you can’t reduce the square footage in that purpose. Commissioner Packer: Well it’s something we may want to come back to, and that is how strongly we feel about preserving retail services along Alma Street, just Alma. Ms. Furth: Well you already have an [overlay] district that is the Alma frontage because the plan as it’s currently written permits, additional use permits for a wider range of uses along Alma if you wanted to think about that. You’ve already got a zone. Commissioner Holman: So that was one, and the other one was, I just wanted to clear this out there. I appreciate very much your comments about, Pat, for the record, about wanting to recommend something that isn’t going to meet a firestorm of opposition. At the same time I don’t think we’re that far apart, and if you and the other Commissioners think that we ought to not have anymore new general office, that we ought to state it as such because those policy decisions are the Council’s. Our charge is planning decisions. Chair Burt: Okay. Well that certainly is something that we can consider as another option. So we’re going to go ahead and take a break at this time. City ofPalo Alto Page 32 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 Mr. Emslie: We heard a discussion about the conversion of ground floor retail - prohibition and conversion of ground floor retail to residential. I just want to make sure. Chair Butt: All he said was that there was a discussion. Mr. Emslie: And I want to know if that’s the consensus or not. That was one that I wasn’t sure of. Chair Butt: He said on the first one that he had heard a consensus on the first ones and a discussion on the fourth. Mr. Emslie: And I want to make sure that that’s not the one that we’~e working on. Good. Ms. Furth: I’m open to discussing that, certainly. I think it’s something we need to look at. Mr. Emslie: We’re not there yet. Chair BuT: Yes. Mr. Emslie: Great. Chair Burt: Okay. Anything I missed? I won’t go all through that. I’m confirming this. On that note, we’ll take our break. Chair Burt: We’ll reconvene. We’ll continue on the discussion about FARs. We gave Staffa concept of wanting to see a proposal that would further encourage residential, and further discourage additional office while maintaining support. Mr. Emslie: So essentially what we’re going to do is come back to you with a recommendation based on this direction for FAR changes that de-emphasizes office and that emphasizes mixed- use retail and residential. So, I mean, I think we need to come back to you with a presentation. I don’t think we need to start futzing with the numbers now. We need to come back to you with something based on input that we’ve heard from our economic consultants, the discussion of the Planning Commission. We need to come back to you with a revised proposal. Chair Burt: We have what’s called a working group recommendation, and the Staff altemative. The Staff alternative was - what I saw.as a member of the working group, Staff had looked at a few different things and had this as a somewhat scaled down - You scaled down your original proposal prior to the economic analysis. I think we would welcome - Certainly I would welcome would be what would be the Staff recommendation going forward. Mr. Emslie: And that’s what we intend on doing before the 21st. Commissioner Holman: So Pat, one bit of clarification. The recommendation that you made about the .25 for general, is that on top of the working group recommendation, or on top of the Staff alternative, or - Chair Burt: What do you mean by "on top of?." City of Palo Alto Page 33 1 2 3 4 5 6 7 8 9 10 1! 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 Commissioner Holman: Any place, in other words, that office isn’t restricted by this. That’s what you’re proposing to apply, or are you saying instead of either one of these alternatives. Chair Burr: Well, I was conceiving that if we had a commercial FAR along the lines of what I had suggested, that the other constraints that are in the working group and Staffproposal would still apply, if that answers your question. Commissioner Holman: Yes, it does. Mr. Emslie: It’s just the lower FAR for office, etc. Chair Butt: In addition to those we would put a cap overall on the FAR there, but since what we’re going to do is hear back from Staffand the consultants a recommendation to reflect our conceptual proposals, I’m pulling off the table any specific recommendation at this time, and welcome to hear Staffs’ proposal that would reflect our request. Commissioner Packer:. I don’t know if you have included in all this a discussion of an FAR for ¯ the residential part. I don’t think we’ve done that. Do we intend to? Chair Burt: Yes, and that’s the next discussion. Commissioner Packe~r: Okay. Chair Burt: I just wanted to briefly recap where we left off. Now we have still within the 50- foot zone. Now we have a question: Do we want tonight to still give a recommendation on what we think should be a maximum FAR for residential with and without a PC? Mr. Emslie: I think we’d like to hear that. Chair Burt: Okay, so let’s hold that discussion. What do we think is first in the - whether we call it transit-oriented development zone or the RT50 zone, whichever description we use for it - what do we think would be the maximum FAR for a residential development as a as-of-right FAR, and then second question, do we think PCs should be allowed? IfPCs are allowed, should they have a maximum cap? Thank you, but let me frame the series of questions that we will be addre.ssing with FARs. We’ll go through them in sequence, Phyllis, but I want everybody to be cogmzant of the main issues as I understand them. Should PCs be allowed, and should there be a maximum FAR allowed on PCs? Karen. Commissioner Holman: It seems like maybe I’m just beating a dead dog here, but I think TDRs ought to be added to that discussion, as well as density bonuses, which is different than PCs. Both of those are different than PCs. Chair Burt: Because the TDR concept as I understand it would basically - Either we call TDR or some other mechanism, but as I understand your objective is to look for essentially receiver sites for public benefits that might be other than on the project site itself. Is that part of what is the objective? City of Palo Alto Page 34 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39’ 40 41 42 43 44 45 46 47 48 Commissioner Holman: Yes. It could be on the site or it could be itself or it could be on a different site, and as I see it, these RT50s more downtown would be great receiver sites. ..Ms. Furth: Pat, why don’t we have discussion to talk about the base density and the special circumstances density, and in a lot of ways we achieve those special circumstances. Chair Butt: So within the PC discussion, we could wrap this concept of special cii:cumstances. Ms. Furth: Special circumstances, what’s the use. Chair Bu~: Okay. Is everybody okay with that structuring of the discussion? Okay. Great. First one, base density or as-of-fight FAR within the RT50 zone. Who would like to begin? Bonnie, and then Karen? Commissioner Packer: Well, I go for 1.5 as-of-fight in the RT50 zone. That’s what I had in my proposal from last week, and that goes together with allowing the PC some kind of discretionary process for a higher FAR, but with a cap. I’m not sure whether that should be 2 or 2.5. It would be higher than - might be too high for some people, but some kind of cap on PC for higher than 1.5 obviously, plus with all the other limitations I have referred to last week. I don’t know, Kathy, if you have this. We read that into the record. That’s what I’d like to put on the table, and besides the TDRs and the other bonuses, I’m open to that, but I don’t - It’s too detailed for me to get a handle on aspecific proposal on that. Chair Burt: Okay. Karen? Commissioner Holman: Yes, I’m in line with the working group and Staff recommendation of a 1.15 FAR as a base, and to get higher than that, there need to be - it’s not terribly a way long ways away from what Bonnie’s suggestion is, but I think a by-fight, it’s a 1.15 and you give density bonuses and TDR bonuses and you get more density with that, as opposed to the by-fight allowance. Chair Burt: Phyllis? Commissioner Cassel: TDR is usually done - Transfer of development fights is usually done for historic bonuses and for seismic bonuses. It’s not just something where you say, "I’m just going to trade away some of my development fight." At least not in the ordinances that we currently have. So you don’t say, "Well, I don’t want .5, but I’ll trade away the difference between 1.5 and 1.15 to the 5." You only get transfer development rights if you have an historic building or if that building needs to be seismically upgraded. Commissioner Holman: To this point in time, ifI could get a little bit of background to put in, asking around about some things, as I understand it, how PCs kind of started here, one of the earlier PCs was the Calper Street garage, and even though that was called a PC, really what it was is a TDR, because the Cit3~ decided that they wanted a parking garage in that location, and so they allowed a larger development someplace else in order to get the.parking garage at Calper Street. So I’m not limiting TDRs to historic. I’m saying that if there is a public benefit, be it a parkette or parking - something of that nature. City of Palo Alto Page 35 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 Chair Burr: So either way, it was a public benefit that was allowed to be transferred off-site. We certainly don’t want something across town to be a benefit. We want these benefits to remain within the SOFA II area. But I might just say, Phyllis, before we had the TDRs for historic and seismic, we didn’t have those. Planning Commissions made those recommendations and Councils supported them, so we’re not bound by history. We’re the Planning Commission. We get to make recommendations. Commissioner Casseh Right, but we spent a long time in Planning Commission talking about transfer and developments with the seismic, and we tried doing this specifically with what’s now Borders. We actually didn’t transfer off-site. We allowed the extra on-site because of the upgrades. They are very complicated to do. They are not easy. In those cases it was fairly straight forward, and we actually were allowing increased space right there. As we did the study around the TDR at a time, it’s really difficult. One, it’s difficult to find a receiving site that can take it. What you’re essentially doing is saying, "It can go offthis site - offthis neighborhood, the extra land." You can put it somewhere else in the neighborhood, but where are you going to put it? You’re going to have to put it within the space that’s already there. It’s not easy to do this TDR. Chair Burr: We’re not talking about forcing someone to do it. Commissioner Casse_l: It’s not easy to do it if you want to do it. Chair Burt: But the point is, if there aren’t receiver sites, then they wouldn’t occur, so it’s not. Ms. Furth: The ones that I’ve documented have, I think, been successful in that they’ve been very close to each other and they preserved historic building and development down the street to the larger comer site. What we have found is thatmost TDR projects that actually go through involve one owner owning more than one parcel. Then they get away from the pricing difficulty. Just to say that you should or shouldn’t do it. It’s just to say that’s been the only real practical way to get around the pricing confusion. Commissioner Cassel: I can see doing it from the start, places that we’re working with. We ought to be doing that, both on-site or off-site, depending on whether there’s a transfer of development or bonus, because we want to stimulate keeping these historic pieces. What I understand Karen is saying is that we are going to be using this for a lot of other stuff. Public plaza space is one in the proposal that she does, and I guess what I’m getting a sense of is you’re going to do it to keep the density down? Commissioner Holman: No. What it is, is it’s a - in my opinion, it’s a better planning tool than planned community, because the Staff, the Planning Commission could make recommendations for use as plaza. We could make a recommendation of three, five places where we think would be ideally situated for a plaza. So then that owner could be approached, and in exchange for creating a plaza of an appropriate size that we talk about, they can take - Let’s make it easy conversation. Say they have a 10,000 square foot lot, and the FAR is one-to-one, so if they take 1,000 square feet - just for purposes of conversation - make that a plaza, they can take that 1,000 square feet and put it on another part of their property, or sell that 1,000 square feet FAR to City of Palo Alto Page 36 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 somebody else. So it’s not to keep the density down. It’s just to move it around, have some bounce, and get the public benefits for everyone where we think it’s more appropriate. Commissioner Cassel: I guess I’m confused. I though we were talking about FAR in the RT zone, and this seems like it’s going to be down under two or three levels down of details. Chair Burt: Because of a couple of commissioners’ discussions, we went into a discussion of whether - We went a little out of the sequence we.talked about, into a discussion of whether off- site public benefits - whether they be through TDRs or through the PC process -’are a concept’ that we would like to endorse. That’s the discussion that I think we would have there. Why don’t we defer it right now, and go ahead and proceed sequentially as we had talked about at the beginning of our reconvening here, unless Steve wants in. Mr. Emslie: I guess I could get you back on track. Think of it in terms of base and special circumstances, because that is the very essence of a TDR program. You have to establish a base. The whole premise works on you allowing more development than you normally would allow in order to achieve another public benefit elsewhere, and unless you’re talking about base and some bonus. You don’t have TDR, you don’t have PCs, so let’s just consider them all under special circumstances. What do you think are the limits from between that base entitlement, the upper limits of your tolerable development. That’s the discussion I think we should be having. Kathy? Commissioner Schmidt: I think we’ve gotten mostly around the table with the base, and I would agree with that [binds] concept - 1.5, the base can go maybe higher. Chair Burr: And provided that we reduce or continue with what we had already earlier requested of Staff, which is to reduce the allowable additional office construction in the area, I would also support 1.5 as the base. I don’t want to merely allow more housing. I want to address the jobs/housing in balance, and not create as many new jobs as we do new housing. Based on what we earlier had requested of Staff, I would support 1.5 base as well. We have four commissioners who support the 1.5 base and I don’t know what Michael had talked about on the base. He had tossed out a high number on the PC. Do you have that in your notes? Wow. Ms. Furth: If he said it, I’ve got it. Chair Burt: In any event, we have a plurality that gives guidance and we’ll vote on it. Ms. Furth: He said he was sympathetic to 1.5 on small lots, and he’d be willing to go to 2.01.15. He’s going to do nothing to support 1.5 to get housing. Chair Burt: All right, so then that is the - depending on how we define consensus - For purposes here the consensus needn’t be unanimous. I would say for our purposes, if we have a strong plurality, I think we’ll use that term to describe consensus with the recognition that that is not unanimous. City of Palo Alto Page 37 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 Okay. Then we have the question of in the RT50 zone, do we think that a special circumstances - whether it’s a PC or whatever form we think is appropriate - should be allowed? If so, should there be a cap on the maximum FAR allowed in the PC or whatever, and what should that cap be? Bonnie? Commissioner Packer: I’ll go back to my proposal. I’m not sure about the 2 or the 2.5. Ifmore people go for 2, I’ll vote for 2. For a planned community with the additional limitations that are outlined in my proposal. The height limits that are on the SOFA map that we agreed to, and the daylight planes that come out, has to be predominantly multi-family residential and could reflect whatever limits we put on commercial and retail. There’d be a maximum size on the actual units of 1500 square feet in this PC, and there should a traffic management program of some sort. The design of the project should reflect the spirit of the SOFA II cap. Ms. Furth: We’ll have to do that anyway, incidentally - keep everything there. Commissioner Packe_r: Right. Yes, a lot of the things will have to be anyway. Public benefits must substantially enhance important social goals, so we go beyond the public art. Chair Bun: Social being social Or - Commissioner Packer: Societal. Societal. I didn’t know how to put it, but something that is - Chair Burt: How about just a substantial public benefit, and Staffis recommending within the plan, what specific categories those are. Commissioner Packer: You had some and I added some others. It should have at least two of these things. We could have a list for the developers to be aware of what’s expected and that could be written into the cap. Increase the BMR over whatever is the legal one. If it’s 15, it should be 20. If it’s legally changed to 20, it should be 25 - something like that. Provide a number of smaller units that are for middle-income affordable housing that are not specifically BMR. That’s the purpose of having 1,500 maximum squar, e feet, rather than having more smaller one. Provide some public parking. Maybe provide a day care facility or a senior facility or a meeting space for. community services, a non-profit center of some sort. Well-designed public gathering space. That could be the public plaza that might work. Some neighborhood serving retail, if it’s appropriate. I think there may be others in this list. We could, if it matches, say that the developer could propose as part of the project, a TDR that could be negotiated - some kind of plan, and that might incorporate the special circumstances that Karen is - because we can’t anticipate whatever deal might work for a property owner. You know, who knows? So that would be my proposal for PC. By the way, podium or underground parking would not be included in this deal. Is that a given or do we have to specify that? Ms. Furth: If the podium was four feet or less at the grade level. City of Palo Alto Page 38 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 2O 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 Commissioner Packer: Yes, so we should make that clear also. Chair Burt~ That is clear, right? Commissioner Packer: Yes, okay. Chair Burr: Kathy. Commissioner Schmidt: I think Bonnie’s had some great thinking here. Chair Burr: And specifically on the maximum FAR? I support what she said. Commissioner Schmidt: I think 2.0 would be okay. I would have gone a little higher, but I think that might be acceptable on that one. Chair Burt: Phyllis? Commissioner Cassel: I’ll do that same. I’m ambivalent about it, 2.5, 2.0. I think the 2.0 might be a little more acceptable [inaudible]. So I’m feeling like I want more housing in this area, but at the same time, I’m concerned that it will not be acceptable. Chair Burr: Ifeel the same way. I think that one of the things that we need to be reminded of is how plan policy actually, on page 12, which is wherewe have the mixed-use definition and around the transit area, they’re talking about at least 2.0, and yet I think that more than 2.0 not only would have an even greater concern by the neighboring community, albeit that residential is several blocks away - single-family residential is several blocks away from here, and this is a limited portion of the plan. I also think there’s another element that I would like to add to this, and that is that the new development, during construction or as a result of its construction cannot harm the existing retail that’s in the area. I would like to see that aspect strengthened in the plan. Commissioner Cassel: How do you do that, and what do you mean? Construction is construction and it’s difficult. Chair Burt: Construction isn’t construction. We have all kinds of constraints on how construction can occur. There are ways in which construction can be adaptive to not being detrimental to existing businesses. So it’s not a constant. It’s not... Commissioner Packer: A PC is a process that allows a lot of community input, and at that point, I think any neighboring person who would be affected by a project would raise the issues, and certainly those issues that are raised can be addressed as the conditions for the planned community, and we could add something in there - you know, cooperate with... Ms. Furth: Or we could put that in the policy section. They have a policy section that construction management plans should be devised and implemented so that redevelopment doesn’t hurt existing retail. I think it would go better in the existing policy section. Chair Butt: That’s fine by me. I wasn’t stipulating a location in the plan. City of Palo Alto Page 39 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24~ 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 Commissioner Cassel: My concern is this relativeness about - We’re talking about what is right. Depends on how you’re seeing it, so my concern is that we have some rules, that it’s okay to do some rules and work with the neighbors, but my concern is when you start writing in an overall policy that says, "Thou shalt not hurt the retail next door." There’s no way you can really do it. You can do some things to help. You can do some visual things to help, but if the sidewalk has to be crossed and people can’t get there, it’s going to impact that business. What are you going to do? You can do some things to .assist that, we already have rules in the city that make sidewalks go around and do all kinds of things of that sort. Chair Burr: We have mitigations that can occur. There are things, but how can we argue that we do have existing mechanisms that go in this direction and in the same sentence say, "But we can,t do anything to mitigate construction." Commissioner Cassel: I’m not saying you can’t do anything to mitigate construction. My concern is that we have mitigating factors. When you start saying you can’t impact the residential area, you have now gone beyond the point of trying to mitigate as best as you can. Ms. Furth: We understand that there’s inevitably some disruption. We also understand that putting a policy in response to something or other - that those alleys are supposed to principally resources for the commercial businesses. I mean that if they can be used for flower displays, too, that’s fine, but their principle reason is to support commercial. We can do something similar. Mr. Emslie: We need to come up with something that won’t tie our hands. Chair Burt: Phyllis, as an example on the discussions of the alleyway with the 800 High Street project, the developers have come back and said that they believe that they can, in fact, prevent disruption to the neighboring retail business through mitigations that they can do that are not required under our existing code. Commissioner Cassel" Okay, I just don’t to worded it in such a way that someone can come back and say, "You can’t build that project, because you said I have to be mitigated, and I can’t operate my business-because you’re developing it next door." So I want to make sure. Mr. Emslie: We’ll make sure we don’t do that. Ms. Furth: Chair Burt: Ms. Furth: insure it. We won’t set a standard that’s impossible to execute. That’s the goal. Great. That, I find, is reasonable. It’s like we don’t say the lighting will ensure safety. It will promote it, but you can’t Chair Burt: Okay, so under that condition, then I would also support the 2.0 FAR cap on PCs. Karen. Commissioner Holman: I haven’t weighed in on this yet. As I mentioned last time, I flipped back and forth on both sides of PCs and then decided to opt in favor" of TDRs and some density bonuses, so I’m not in favor of the PCs; however, since I’m in the minority, I think there are some City of Palo Alto Page 40 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 46 47 48 things that need to be done with the recommendations, whether it’s Bonnie’s printout here or if it’s the Staft’s proposal here. Something that isn’t addressed is, there needs to be some way to quantify the public benefit because that’s where we go awry with PCs now, and I wish I had a magic wand and could just go, "Oh, this is the answer." But it seems like if you’re going to go for BMR housing, if there’s a density bonus for that, for instance, or an FAR bonus for that, it should be quantified in some fashion. For every one unit of square footage, there needs to be some kind of equitable - you’re nodding your head back there, like there might be some way to address that, so that there could be like for every 500 feet of BMR units, then no more than 1,000 square feet could be - There needs to be some way to quantify. Ms. Furth: A couple of things. One is, there is a bonus program in the [inaudible] plan already about how many additional units you get for each additional BMR unit. So that’s one thing you might want specifically put in here. The city has not tried to quantify public benefits because it felt that this was not a direct dollar engagement, and the object of the exercise was to have a project that, on balance, was a good idea and should be approved. I think that by Setting FAR constraints and identifying the kind of public benefits that you think are significant, that gets you a long way away from some of the things that you really don’t like. I mean, like the sense that there’s no limit and that a park, for example, doesn’t provide the kind of benefits that you think the neighborhood needed or something like that. I’m leery of a lot of quantification. I think that it is an illusion. : Mr. Emslie: I’d just throw out, maybe again, it’s something that is more specific to the project and maybe we want to set out a goal that you would want to evaluate the public benefit and make sure that it’s commensurate with the amount of benefit derived from the increase up there. Something like that, that would give you some guidance. Remember, you’re in a discretionary area with PCs. You’re exercising your judgment. Ms. Furth: And also, you know, you can’t approve a PC unless the project itself is a good thing. So it can’t be that it has so much public benefit that a bad project is okay. Commissioner Holman: We have strayed in the past, though, so that - Ms. Furth: Well, we cannot guarantee that we will not stray again, but writing more rules won’t stop it. COmmissioner Holman: I think having the maximum FARs is a step in the right direction. The BMR housing thing is in the other, so we can use that, but I was hoping there was some way we could address some of the other. Chair Butt: IfI might just add, in the plan, we not talked about a cap on the maximum FAR, which had not historically be done on PCs in the city, but we also already have, before including. any of Bonnie’s recommendation, the Staff proposal already has some descriptions of what are substantial public benefit types, and so those are two things that we’ve done that have made a PC more clear in terms of what its limits are, and what the benefits may be. It’s not a formula, but we’ve gone further in both directions than has ever been done in the city. ’ City of Palo Alto Page 41 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3O 3.1 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 Ms. Furth: You fixed the height, and you fixed the FAR, and you fixed the daylight plain. If there are other areas that you’re very concerned about - I mean, PCs alter the rules, and if there are other rules that you are very concerned about, we could try to understand [inaudible] try and deal with it. In one way, you are becoming so precise that it almost looks more like a conditional use permit. Commissioner Packe_r: I just want to add a response to Karen. When I look at these lists of public benefits and we say, "At least two of the following." If were a developer, i’d probably go, "Gulp. These are expensive things to provide." And so I think these are substantial things, and I even wonder whether anything can be built with such a list of public benefits, but hopefully there’ll be some developers and lenders who’ll see the say to do it. But I don’t think these are inconsequential public benefits that we’d be requesting. Chair Burt: So, in summary, Karen still has a concem over PCs, but would be receptive to some other special circumstances along the lines of a TDR concept, and the rest of the commission has a consensus of a 2.0 FAR probably being an appropriate balance between housing advocacy and what would not be overburdening on either the adjacent SOFA 1 neighborhood, or, in my concern, making sure that existing retail is not harmed excessively. Ms. Furth: I understood that to be during construction. I assume you’re not proposing some rationing of new businesses. The market will determine what kind of business. Chair Burt: No, I’m not proposing rationing of new businesses, but my concern is not just during construction. I would say, as a result of the new project, we would not want to essentially drive out highly valued retail. Ms. Furth: Well, I have a real concem about establishing monopolies for any particular kind of business. You need to exclude economic factors. Competition. I mean, you’re talking about physical factors. You’re talking about creating a situation that’s an on-going burden. Chair Bun: Right. Ms. Furth: Yes. Chair Butt: Correct. Mr. Emslie: An extreme example - you’ve got a nursery, and you know that building a structure would put that nursery in shadow and it can’t grow anymore. If you have a nursery and a nursery and they compete, that’s - Chair Burt: Yes. That’s right. Mr. Emslie: I wanted to make that clear. Ms. Furth: And if my notes say that commissioners, purely for discussion purposes, put out an FAR with a PC of 2.33 and RT50 and 2.0 in R25. City of Palo Alto Page 42 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 ~31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 Chair Butt: So Commissioner Griffin - For purposes of discussion, we can assume that Commissioner Griffin is not advocating a lower limit than 2.0 for the zone, and he will have his opportunity to make his final vote on the 21st. Does that capture the consensus of the Commission? Okay. Commissioner Holman: And again, just for the minority person here, I’m no greater than 1.5 in the RT50 unless it’s an affordable housing project. Chair Burr: Okay, and then we have a final sub-issue on this, which is within some of these public benefits, whether it be through a PC or a TDR or whatever special circumstances, are we supportive of allowing - not prescribing - but allowing benefits to be done off of that specific site, but within a nearby area, as I understand it from Karen, under the concept that it may be better area planning to have public benefits at identified locations. If a developer is receptive to pursuing that as a benefit, it may facilitate the other goals of the plan to allow public benefits other than on the site of the PC or the development. Commissioner Cassel: Why couldn’t we just have a statement in the CAP that we recognize - that would allow the proposals of the TDR so it could be decided on case-by-case basis without putting a lot of details about what they would have to do. Ms. Furth: We’re talking about two different things. Chair Burt: We don’t have to call them TDRs. First, we don’t have to call them TDRs. I think if we start with a concept of a public benefit off of the project site, then later we can have this discussion on exactly what form it would be. Commissioner Holman: And it can be on the same site, too, if shifted to another part of that project. Ms. Furth: You certainly have a public benefit, such as a day care center or extra parking or whatever, on or off the site. You can decide whether or not it’s acceptable. We don’t have TDRs on a site because a site has a density potential, and so you don’t put it on a square foot basis. It’s on a site basis, so the concept of TDRs doesn’t [talk over] on a single site. Chair Burt: Understood. I don’t think that was a proposal. Ms. Furth: You can have a notion that what exists downtown - and you can expand that - that if you have an existing building on the site, and the owner of that site prefers to retain it, and it’s not already built to the maximum FAR, which is unusual in that area. Much of it is built over the maximum FAR. That that person could give up their rights to build any more square footage on that site, and transfer it to somebody else. That’s easily done in terms of documenting. The question is, what would be a receiver site, and could you increase your FAR up towards the PC, the special things limit, by saying, "I’m not increasing the overall density of the development and SOFA. I’m taking some development potential over here on Homer. I have put it over here an Elma, and I can do that essentially as-of-right, because I’m within that space between the entitlement and the special benefits." You can have a program like that, if you want. City of Palo Alto Page 43 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 Commissioner Packer: To me that would defeat the purpose, of having the PC with its limits would be designed for. Ms. Furth: You’d still have limits. Chair Burr: You’d have the same limits. Commissioner Packer: Oh, you’d have them but you’re saying... Ms. Furth: IfI have 1.5, and I want to go to 2.0, but I don’t want to through this whole PC process, then the only thing I could do is talk to the owners.. ¯ Mr. Emslie: What it does is it relieves you of the public benefit. Commissioner Packer: That’s what I mean, but do we want that, because if you do that then you don’t get the public benefit that you would have gotten if the person with the benefit. Mr. Emslie: You make it permissive. You allow this as a tool in addition to the other tools. I think that works very nicely. So that if someone did want to fuss around with deciding the uncertainty of what the public benefit would be, they may be approached by someone who says, "Look, I don’t want to develop my end. I’d like to turn it into a park, but I need some economic value for it. Here’s what it’d cost me." So you could go evaluate. They would do their own analysis as to what it might cost. Find out what the city might be asking for in public benefit, and weight the choice, and be able to decide that they would do that off-site. I think you might provide it as an option is an excellent way to handle it. I think it adds a lot of certainty to the process that’s very attractive to the development community. Ms. Furth: The other thing is it does also encourage the diversity of built environments because it means that there’s not such relentless pressure to build to the maximum everywhere. Chair Butt: I’ll give you some examples. Part of the Council guidelines was to look for opportunities for mini parks, and they don’t have to be large, but something that’s.. Ms. Furth: If someone had an empty lot. Chair Burr: We have within the new urbanist concept that we should have some common space, and if a developer is on Alma Street, and we don’t think that’s the best place to create a public gathering spot within the SOFA II plan, if instead that developer would like to pay for contributing to a public space in a much more desirable location within SOFA II, I think that’s flexibility that would be good and serve the objectives of the planl This gives latitude to do that. Commissioner Cassel: I see us as having three different items on the floor at the moment for discussion. One is the right to take a public benefit that you’re proposing and allowing the owner of the - that has a full 2.0 and allow the owner to take the public benefit and put it someplace else. That’s what you’re talking about. What Steve’s talking about is something directly opposite that, and that is, they’ve got the right of 1.5 to build there, but they accept off a transfer to a development site someplace else, to receive City of Palo Alto Page 44 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 some square footage to bring them up to the 2.0 without the public benefit. Those are both viable concepts Mr. Emslie: They’re not exclusive, but they can be done together, yes, as an object. Commissioner Cassel: Both are options. They’re not really going to be - Mr. Emslie: They won’t be done at the same time, but - No, no, I agree. Right. Commissioner Cassel: So those are both options that we can both do, so that we can allow this area, or even some other area, to receive square footage in order to relieve what we presume is going to be historic and seismic bonus that you may not want on site, onto these sites, and then they don’t have to do the public benefit. Those are different: Chair Burr: They are a couple of different forms of offrsite. Commissioner Cassel: Maybe we can have some consensus on one or both of those. Chair Burt: Or what I would suggest is that one again, we try to have consensus on a concept, and let Staff come back with some specific proposals. Commissioner Cassel: But I think these concepts are fairly easy to understand. I think we can have the concept - I don’t think it’s so hard to decide whether we’re going to allow the people to take that public benefit off-site. We’ve talked about this a lot. Chair Burr: That’s the concept I’m referring to. Commissioner Cassel: Right, right, but on his concept also. Chair Burt: Hey, Steve. Would you re-explain your concept of the receiver site. Mr. Emslie! Okay. There’s an entitled FAR of 1.5. The developer decides he wants to develop the piece of property. They don’t. It’s unclear as to what the city might ask in terms of public benefit. They don’t want to go through the PC process. They’d rather build more square footage than 1.5, so they go and sites are predetermined in the plan or area are drawn where we want to achieve a public park. We want a plaza. So the developer goes to property owners in the vicinity of where we want that public plaza, and they say; "Well, we’d be interested in buying your property and using that as a transfer development right, and with the proportions - There’s a little bit more to figure out than taking that FAR, and perhaps it’s on a one-to-one basis - square foot for square foot - and then adding that to their project, and they don’t go through the PC. They get 1.5 plus, without having to go through the PC, because they will already have acquired that piece of property and turned it over to the city for some public benefit. Is that clear? Ms. Furth: With it’s actual transfer to the city, you can also just understand that as an off-site PC benefit. But another possibility is that there is an existing building. It’s not built up to the zone, but it would be a benefit to the city. Essentially they can go up - It’s build to 10,000 square feet and it could be 15,000 square feet. You take that 5,000 square feet of development potential and they move it to their site, and there’s no greater impact on the area as a whole. City of Palo Alto Page 45 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34, 35 36 37 38 39 4O 41 42 43 44 45 46 47 48 Chair Burr: What I understood is that’s a different issue from a public benefit - an off-site public benefit. What I understood Steve’s notion of off-site public benefit to be really the same as mine, but the tool might be different to achieve it. Commissioner Packer: But we’re just talking this doesn’t involve a public benefit. It just means that the site that could have been developed to 15,000 will always be limited to the 10,000 Chair Burt: I think that’s a separate issue from what I understood Steve’s proposal to be is a different mechanism to achieve the same outcome of an off-site public benefit. Commissioner Cassel: I guess I’m not seeing it that way. Chair Burr: Okay, but you may not be, but I’m asking Steve clarify how he sees it. Mr. Emslie: The major difference of the proposal I’m thinking of is that it takes the uncertainty out, that there’s a pre-described public benefit that the reward for that is you don’t have to go through the PC. You’re guaranteed that Chair Burr: But the same outcome. Commissioner Cassel: But I think the problem with continuing to use the term public benefit is we’re getting it confused from the requirements to add extra FAR must have a public benefit, and a different concept of public benefit in that it’s good for the community as a whole, thus it’s a public benefit to that building over there to transfer over here. So one is, are we going to allow these people to be receiver sites of someone else’s public benefit, and one is, are we going to let the owner of this site have a public benefit and do it off-site? Mr. Emslie: I think you can do both. Commissioner Cassel: I’m sure we can do both. They’re two different concepts, one of which is, this developer has to do a public benefit because he wants to go to 2.0. He has to do a public benefit, but does he have to do it on-site, and the other is someone else is doing a couple of things to receive someone else’s square footage and we avoid the term "public benefit" without doing a "public benefit" for that building. So we’re using this term in two different ways. Mr, Emslie: I think we’ve got a sense of adding that to the list of special circumstances that would apply to allow developer to go up to 2.0 I think we’ve got a good idea to be able to flesh that out. I don’t think there’s any problem. Ms. Furth: One thing that Steve had mentioned to me earlier is we all said we’d not be very comfortable with identifying particular sites belonging to private individuals and say, "Go get that one." Commissioner Packer: Yes. I don’t know how this - Maybe there’s historical case studies of areas where this has worked really well. I just wonder if this would mean that developers who happen to have a lot of cash go around buying up all these small buildings along the edge here on City of Palo Alto Page 46 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 Addison, and go up and buy their development rights and just take them over, and then those places will stay forever small and lightly developed, and maybe. Ms. Furth: You may want to designate what the donor sites are. Commissioner Packer: Yes. It may create a blighted situation because then it would always - There’s a potential. I don’t know if that could happen, rmjust looking at what are some of the downsides, because there’d be no control. We’d lose control. I mean, the whole purpose of the SOFA cap was to determine what you want where, and now the marketplace for development does. Ms. Furth: I would presume a certain amount of preservation. Chair Burr: Well, I understand you now to be discussing what I would call the other half of that question, which is what Wyrme had brought up, and that is, should we allow a site to have essentially what we call a public benefit or whatever, that we develop up to the allowed - as a bright FAR, and that they can trade that development potential off to another site. Ms. Furth: And that’s exactly, incidentally, what we do right now. Permanently give away their rights to that space. That isn’t to say the city can’t~ in 20 years, rezone the entire downtown from FAR to 5.0, at which point everybody will take off again. Chair Burt: Now on that separate issue, I’m less supportive of that. I have reservations about that concept. I like the concept of being able to have public benefits, whether they’re through a PC or some other mechanism, but public benefits at most appropriate location~. It might be parking. You might say that one site lends itself to an efficiency of underground parking that’s public parking, and other small sites don’t. So it could be any of these things that are listed on Bonnie’s list that might be receiver sites, other than on the project location, but I’m not sure that I would want to go along with say what we’re basically going to do is say that everything here is going to be allowed to go up to 1.5 FAR on average, and if it’s not economical to building 1.5 at that site, we’re going to let them sell off that right to another site to go up above 1.5. That, I’m not so sure that I would support that. Commissioner Holman: That’s exactly why I wanted the base FAR to be lower so that you have to earn anything above that, and some benefits to allowing properties to sell off their excess, if you will, FAR is that, say for instance you have a - We have a laundry and a cleaners on Emerson, just to give a couple of examples. Those are not very high FARs, but if you want to retain those businesses, one way you could do that is let them sell their extra FAR, or at least a portion of it, to help encourage them to retain the businesses. Because a lot of time if those parcels get redeveloped you’re going to lose thos6 businesses, because they’re not going to be economically possible. They’re not going to be within economic reach of those businesses to stay in a redeveloped property. Ms. Furth: I do think that it’s not been experience - I’ve worked in about four TDR programs - that if you actually want to get housing at 2.0, for example, if it’s contingent on acquiring development rights from others, it will be very difficult. Commissioner Holman: That’s not the only tool we’re giving. City ofPalo Alto Page 4 7 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4O 41 42 43 2~4 45 46 47 48 Commissioner Cassel: I’m really concerned that we’re making this terribly complicated, and you’re going to have to develop someplace. Depending on where you’re going to put it. Commissioner Cassel: The person who owns the property is not very often the person who rtms the business, so what makes the business itself functional depends on its rent, but not necessarily on how tall that building is. You try to encourage retail business, and we’re trying to put in a mixed use of which people are living above those lower retail and not trying to just move it around. If you think in terms of wanting some consistency along Homer, it doesn’t mean that you want - except for the really precious historic ones - which is normally what you would do for transfer development rights - you want to build some consistency in that plan. I don’t quite understand how much are going to transfer and how much are going to transfer to where, and this little area that we just talked about, this RT50, is a very small area. It’s not going to take very much. The difference - I just think what you’re proposing is extremely complicated. When we tried to develop the transfer development rights for historic buildings that would allow the seismic increase, it was amazingly complicated to do it. Just for that, and we want to presume those historic ones. If we can just do it for the historics, I think it would be a tremendous amount. Mr. Emslie: I might say if you convince the commission to move into this area, we would not recommend that. We have the program laid out in this plan that we would recommend that the plan include direction and that that plan be developed, because there is several factors that I don’t think we’ve got time to factor in here, but we would include that in the direction and continue .to work on developing that plan if that’s the direction the Commission wants. Chair Burt: In order to move forward tonight, I don’t feel comfortable with making a recommendation one way or another on this issue tonight. I feel like that second half we were just talking about. The first half, I’ve supportive of exploring public benefits to be - Mr. Emslie: Kind of like a certain PC. Chair Burt: Whether it be a certain or an uncertain, I think is open to discussion, but the concept that I would support is allowing receiver sites for a public benefit to be other than on the project property. Whether it be through a certain process or an uncertain process could yet be determined in my mind. Ms. Furth: Right now you have two bonus programs, one for seismic hazards and one for historic preservation, and the historic preservation one can be transferred also. You want the seismic to be transferable also? Mr. Emslie: I would say you want to transfer historic sites, and I think we want to add open space and parking, and we may come up with but I see those as the big four. Chair Burr: Okay. Try to keep this moving. We’ve got some important things to try and wrap up. Do we feel like we’ve given Staff adequate sense of our consensus on this issue? Commissioner Packer: I have a question. I can’t get clear what we decided earlier on FAR and PCs. Were we limiting our discussion to RT50? City of Palo Alto Page 48 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 Mr. Emslie: We have not done RT35 yet. Commissioner Packer: Good. That’s what I thought. Mr. Emslie: So we’ve done RT50 at the 2.0 cap, and we will allow public benefits to be done off-site in a process that Staff will recommend some refinement based on some specific public benefit goals. Chair Burr: Now let’s talk about the RT35 zone and the FARs and the PC issue regarding the RT35 zone. So, bearing in mind we’re getting to a late hour, let’s try to push this forward. Let’s lay our positions out on the table in as a succinct a manner as we can from here on. Bonnie. Commissioner Packer: Well, earlier I asked Alison what would be the proportional difference for FAR from the RT50s and the RT35s, and I would propose that whatever that proportional reduction would be, that would give an equivalent massing as a 1.5 FAR RT50 that an equivalent FAR would work for the RT30~ and I would still like to see the same PC with a 2.0 cap, even in the RT35, keeping that height limit, because from the economic analysis, there’s a lot of these smaller parcels. Sometimes the higher density seems to work a little bit better on those smaller sites. Chair Burt: But wouldn’t that run contrary to your equipment. Commissioner Packe_r: It might. It might. Maybe it would be 1.75 or something. Chair Burt: Well, not equivalent massing. My concept would be, if we’re going to have an equivalent massing, it would need to be a PC cap somewhere closer to 1.5, if we’re talking about a three-story project. Alison? MS. Kendall: What I was trying to do a quick little sketch to thing about if what you developed as a prototype is the 1.5 to 2.0 stepping, 1.5 being the as of right or the RT50. If you were to keep that same amount of FAR per floor, then you’d be looking at something on the order of 1.0, stepping to 1.5. Ms. Furth: No, 1.5. You’re saying 1.5 is four floors? Ms. Kendall: 1.5 would be three floors, so you’re .5, and then the PC - I’m sort of assuming that the PC is kind of- Ms. Furth: The equivalent of your fourth floor. It could be all the way up to .5 yet again. So if you were thinking of the shorter building in somewhat of the same framework, what I had developed here is if you were to scale down everything a little bit, each floor is .4 FAR, you have a little more open space. It’s kind of a townhouse type is what we’ve generally found when we did them on various sites. Say each floor is about .4. You’re getting a base of about 1.2, which is very close to the 1.15,. Then you’ve got this little extra layer that is up to .4. That might be a supplemental. Perhaps that could be .3 because that allows for the fact that you don’t really want that extra amount. City of Palo Alto Page 49 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 Chair Bur~_: In my mind it’s real close to if we stayed with the Staff and working group proposal for that area of 1.15 and a PC up 1.5, that’s approximately proportionate. Commissioner Packer: Okay. Chair Butt: 1.15, staying with the by fight, same as the working group, and a PC upto 1.5 would be my recommendation. What do other commissioners think? Mr. Emslie: That would be PC with all of the conditions that we have discussed? Chair Burr: Yes. We may not get many PC applications under those circumstances. Commissioner Schmidt: It is feasible? Mr. Emslie: Let’s ask our consultant. Chair Burt: I’d like to broaden that question. Commissioner Cassel: My instinct is to say yes, and my reading of that did not tell me that that was going to be possible. Chair Burt: As we heard earlier, the economic analysis is good for about six morlths, so it may not be financially feasible today. It may be over the course of this plan period. Commissioner Cassel: But at least it ought to be financially feasible today. Chair Butt: We may not have redevelopment in the entire - let’s say a conceptual one. Are we looking to necessarily make all lots incentivized to be redeveloped today? Commissioner Cassel: But I’d at least like to hear the discussion for today. Matt: IfI can clarify the question first, we’re talking about a 1.15 base and the ability to go up to 1.5 with a PC, which then assumes that there’s some sort of additional public benefit being offered. As Steve said, our original analysis, or the analysis that we’ve conducted does not look like it was for economic incentive for redevelopment at 1.5 FAR without reduced parking. Then that does not allow for additional cost for PC type concessions, if you will, to achieve that, so I think that again the scenarios that we’ve outlined, which that’s that fairly initial value for redevelopment threshold, we wouldn’t see a whole lot of incentive for properties under that particular set of circumstances to redevelop. It’s not to say that there’s no economic value in that level of development. It’s just saying that the existing economic value of the site has to get down to a relatively low level in order to make that an attractive option. Mr. Emslie: You were saying that it’s the 1.15 that is not economically feasible? I just want to clarify that. Mr. Kowta: Yes, and even if you go up to 1.5, you need to have reduced parking and no additional PC requirement or cost. City of Palo Alto Page 50 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21, 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 Mr. Emsli_e: You could make it worth 1.5 without any -If you reduce the parking and you didn’t have public benefit, 1.5 would be economically feasible? Mr. Kowta: It’s marginal. On a small site, that is slightly below what we set as that threshold. On the large site, that reduced parking gets you 1.5, reduced parking, no additional PC requirement subject to a different dollar-per-square-foot threshold works. Chair Butt: And Matt, jusi a moment ago you said that it wouldn’t work unless the existing use were reduced in value. Is it also that it would work if the perspective use went up in value? Matt: Generally speaking, yes. So, in other words, there’s a set of economic circumstances where the values are high enough beyond what they are today, that a 1.5 FAR with reduced parking with potentially some additional costs associated with PC, public benefits, that it would be economically feasible. Likewise, there may be some property out there right now, because of its current economic value that would be attractive for redevelopment without having value increase. Chair Butt: Thank you. Karen? Commissioner Holman: I’m with the 1.15 FAR, and to follow up on your comment, it may not be economically feasible now, but - I’m kind of repeating myself from last week - but construction costs haven’t gone down. Rents or returns have gone down significantly. If we curtail new office, it’s going to be more attractive for other uses. We have a housing need and that market price is going to go up. But there’s no place but for these opportunities to get better and more than they are now, so it isn’t that we’re trying to promote every parcel to.redevelop, so I think I’m okay with the 1.15, and the market will tell us if we’re wrong. Chair Butt: I think it’s important to remember that this area was viewed as a transitional zone toward the surround neighborhoods, and for that reason, even if we would not see significant redevelopment in near term under this proposal, I would be hesitant to allow a higher FAR than we’ve been discussing because it would stop having the role of being transitional. Bonnie? Commissioner Packer: One of the things we didn’t talk about in the RT50 was whether or not to have reduced parking, but what I would propose - especially based on what Pat said - is go with these lower FARs provided there’s a process to request reduced parking - with the Planning Director’s approval - higher than - It’s up to 20 percent now. I would even say for cap, give the discretion to go to 25 percent reduced parking, which might allow some development to squeeze in the bottom line. Chair Burr: Is Staff proposal for reduced parking connected with TDM program? Mr. Emslie: Yes, it is. That’s the next topic, yes. Commissioner Packer: Some of these parcels are small, and I think a DTM program for a three- unit townhouse might be a little silly, so I think we have to be creative, and we have one set of concepts for the larger parcels that are on the west side of High, but they tend to be small parcels in this transition zone. We may even want to Consider in the PCs saying the public benefit City of Palo Alto . Page 51 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3O 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 should have at least one of the following benefits instead of two, if it goes to the PC route, because we’re talking about smaller projects in this area. Commissioner Cassel: Let’s try a different way of looking at it. What we’re trying to do in here is get some mixed use. Maybe what we want to do is do the 1.5 with the mixed use. What we’re trying to do is get your retail on the first floor and get your housing up above. Commissioner Holman: 1.5? Commissioner Cassel: Go with the 1.5 in mixed use situations. We’ve been talking about housing and increasing housing. We don’t want all that housing in one spot. We don’t want all that mass in one place. We’re trying to spread it out into something that will function and give us a better scale than a 35-foot height limit. We aren’t going to get it, but what we’re going for is some mixed-use spaces and some mixed-use housing and that housing spread out so it’s not all in one spot. Ms. Furth: So this essentially would be a proposal for additional FAR for housing on top of the existing commercial development. Commissioner Cassel: We’ve been talking about mixed use and whether or not - Ms. Furth: But since that area is largely developed with commercial, right? Commissioner Cassel" Right. Ms. Furth: RT35. Commissioner Cassel: Develop the retail and commercial. Chair Burt: For clarification on terms, we need to differentiate. Retail is a form of commercial, so I think what we’re referring to is office commercial versus the other local serving that is not only retail, but local serving personal services. So we’re talking about those two categories of commercial. One that is essentially local serving retail and business services, and the other that is office. Commissioner Cassel: Well~ let’s use the term of general business office that people are trying, right? Chair Butt: Okay. Commissioner Cassel: I don’t find so offensive, but other people do. So we’re trying to limit the general business office and not encourage the new general business office. Chair Burt: Yes. Commissioner Cassel: The other permitted uses that we’ve been trying to encourage that we already have in the area, we’ve been talking how to put a mixed use facility and it’s all kinds of stuff in here - ideas and concepts about how to do that. We aren’t going to get any of it at a 1.15. City of Palo Alto Page 52 1 2 3 4 5. 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 The costsof construction are not going down. Rents go up. They go down. They may go up, but costs of construction, I can assure you from some other issues, other places are not going down. They continue to go up, so that balances other issues, andif we want to encourage some mixed use development and some housing that’s spread out, we need to encourage that kind of facility, and we should be encouraging it with the reduced parking in order to facilitate that without public benefit at the 1.5. Mr. Emslie: It’s essential. I agree with what Phyllis is saying. The only way you’re going to do that is with reduced parking. It’s all about parking. You’re not going to get any of this unless there is a parking district or you reduce the parking requirement. Commissioner Cassel: And if y~)u looked at it, even if you reduce the size of the unit so that we were going to get these nice little sized units that we really want - because 1,500 square feet isn’t small. It’s a good sized three-bedroom apartment - we couldn’t get the units because the parking requirements are - Now you get them down somewhat because one-bedroom only requires one unit or one space or 1.25 spaces. That’s the only way that’s going to happen. Chair Burt: Well, I agree that the parking is certainly the biggest driver on the economics of the project, and I’m supportive of evaluating the use of reduced parking requirements, but it’s reduced parking requirements when there is, in fact, a basis to presume reduced parking demand. I don’t think we should just reduce parking requirements regardless of how much parking is needed for a project. So if we either have a project that is a mixed use that allows for genuine shared parking, or we have TDM programs that reduce the parking demand, and we have adjacencyto the transit, all those things could help justify reduced parking, but I don’t think we should just simply say, "We’re going to reduce the parking because we want to create this redevelopment." I think we should equate reduced parking requirements with a reasonable basis for expectation of reduced demand for parking. Commissioner Cassel: Well, the train station isn’t going to go away, so that’s there unless we do something wild, and the bus station stops we have now aren’t going away, so we have that portion that you’re talking about. The TDM plan is discussed - The transit demand plan is discussed else where in here that we can get to. So there’s that piece of it. We’ve been talking about mixed uses and that can be easily part of it. Yes, it simply isn’t going to happen. Commissioner Schmidt: What Phyllis is saying and what Steve is saying, you’ve got to have reduced parking if you want anything to happen here and it is close to transit. That’s one of the whole important points. We’re trying to have more density here, so I think we’ve got it. I think we should.. Commissioner Packer: Keep in mind that one of the suggested public benefits for RT50 zone is more public parking, so that could provide more parking across the street on High that will make up for the reduced parking in the RT35 zone. Ms. Furth: You could think about it as whether you want zoning that will accommodate one-car families. Chair Burt: Karen? City of Palo Alto Page 53 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 Commissioner Holman: I was going to support Pat’s comments because it’s close to the train station now, but you go down there and there are ears on every piece of the street, and the train station is there, so I think it does need to be in companion. If there’s going to be.any kind of reduced parking requirement, then it should be matched up with a program. Chair Burr: I’m supportive of looking at the reduced parking, but I don’t think we go in sequence of saying, ’,Well, we’re going to reduce the parking requirement to drive the redevelopment." Then we hope that somehow there’ll be less demand. I think we link the two, and we are deliberate in how the relationship between reduced parking requirement and reduced demand for parking. Commissioner Cassel: I guess I try to start someplace, and I thought in here is all of that, that it’s part of the proposed plan that we do TDMs with it and it’s part of the proposed plan that if we’re going to reduced parking that it has to be linked up. I just thought it was in the plan, and I was just trying to get us started on one piece of the corner to see if that piece of it would fly if we could do some of these other things. Chair Burr: So the question is, we recognize there are aspects to - Really, I think it was more in the Staff proposal on this. I think the working group did not support. Mr. Emslie: Right. The code with [1882] parking. Chair Burt: And so the reduced parking requirements are in a Staffproposal elements, and so that’s where I go back to saying that we would need to differentiate between simply saying, we’re in favor of the reduced parking, and the specific endorsement of elements in the plan that would go along with reducing demand for parking, and that I wouldn’t support the one without being very specific on the other. Commissioner Holman: Can I get a clarification. Actually it’s not a clarification. It’s a recommendation. I’m not too keen on big parking reductions. I’m supportive certainly of tandem parking, and I’m supportive of some TDM programs - and Pat, you heard me say this long ago in the working group. To do shared parking for mixed use projects, and then also link that to the fact that it’s near the train station - near public transportation, is banking on two different things to be at play at the same time. So either decide that - if there’s going to be a shared parking aspect, either decide that the commercial aspect is going to be linked to echo passes or something that’s to keep them from coming, but don’t assume that if you’re near the train that all the residential cars are going to leave. That’s not transit-oriented development and that’s not taking into account what true shared parking is. Chair Burt: Although it may have some hybrid of those two concepts. Commissioner Holman: There may be, but let’s just not talk about shared parking near transit where the residential cars leave during the day, and the office cars come in during the day. I’d just as soon that not be part of any of our discussions as far as parking requirement reductions. It just doesn’t work that way. Chair Burt: What I’d like to toss out in the interest of moving forward on the parking is that there seems to be support on the commission for the concept of reduced parking, and to ask Staff City of Palo Alto Page 54 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 to once again come back and have within the recommendations an adequate linkage between the reduced demand for parking and the reduced requirement for parking. If that is acceptable to the commission, and I appreciate that many of those aspects are already in the plan, but that would be the concept that we would want to make sure that there’s relationship between those two things - an adequate relationship. Ms. Furth: So that in terms of the Staff recommendation for 33 for 1.5 spaces per unit for residential, you would not be recommending that? 1.5 down to 1. It’s on 33. Chair Burr: Yes. Personally, I would be open to considering that, provided that there is a strong linkage to the reduction in demand. Mr. Emslie: This is it right here. You want us to reword this to make sure the adequate provision of true demand management? Ms. Furth: Well, actually it talks about particular low demand residential uses. Mr. Emslie: You’re asking us to take a look and see if there anything that we would add to strengthen that linkage between the parking reduction and the demand management. Chair Burt: Right, and without attempting tonight to discern whether it’s adequate right now. Ms. Furth: It will be adequate right now. Mr. Emslie: We’ll just see if there’s anything else we would want to recommend. Chair Burr: Bonnie? Commissioner Packer: I’d like to go back to Phyllis’s discussion of the FAR, now that we’re finished with the reduced parking. Chair Burr: I thought we were finished the FAR. Commissioner Packer: Phyllis raised a point of when it’s residential plus commercial - maybe we can have that just retail usage, but we wanted to limit that office stuff- that it could be 1.5 as a matter of-right, and so what I think we could be talking about is three possibilities of FARs in the RT35. When it’s purely residential, it’s 1.15. If it’s residential plus ground floor retail, it can be 1.5, or it can be 1.5 under a PC, with all the Other variables that are allowed in a PC. Is that something we can talk about? We have three possibilities, two as of right FAR, and a PC cap of 1.5. Chair Burt: So 1.15 by right - Commissioner Packer: Is not mixed use. It’s just residential. Chair Burt: Right. And then up to a 1.5 by right if it is a mixed use, non-office commercial. Commissioner Packer: Yes. Ground floor retail. City of Palo Alto Page 55 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 !9 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 Ms. Furth: Non-general business. Commissioner Packer: Non-general business, commercial. Okay. Chair Burt: Phyllis’s terms are probably more explicit. I’m just calling it non-office commercial. Commissioner Packer: Right, and then a PC cap of 1.5 for something else. The PC discussion that we talked about for RT50, we may want to consider softening the number of public benefits since we’re talking about smaller parcels. Small parcels have at least one public benefit, versus tWO. Chair Burt: I’m open to at least considering that as a way to incentivize the retention of the.local serving retail and services. Commissioner Packer: Providing the economic incentive that may help the residential development to follow. Chair Burt: In a way, we’re basically describing retention of- Another way to describe this might be that a public benefit is that we’re valuing that ground floor retail. Commissioner Packer: Except you don’t have to go through the hearing process and [talk over]. Ms. Furth: That’s the desired thing. They’re mixed use and retail and residential. Mr. Emslie: The first I think is very clear. The last one, the PC - essentially what that means is that you’re going to get PC for office. Commissioner Packer: Oh, no, no. It would have to have all the bullets that we talked about for the RT50 PC, except instead of requiting tWo public benefits, it would just be one of that !ist. You soften it a little. Commissioner Cassel: PCs because you’ve got trees you’re trying to preserve in the wrong spot, and... Ms. Furth: Trees should not generate PCs. Reallocating things like that should generate variances. Small scale design issues are not suitable for PC process. Mr. Emslie: Let me just go back and verify all the office and retail caps, being inclusive of all the other uses, would still apply, so that you. could not get a PC that would enable you to go over the 2,500 ground floor or to convert retail to office that was existing, so all that would still apply. Commissioner Packer: Yes. It would have to be primarily multi-family residential. Residential units can’t exceed 1,500 square feet - all that stuff. Chair Butt: Great. Karen. City of Palo Alto Page 56 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 Commissioner Holman: I guess I am expecting the market to change so I’m for the Staff recommendation at 1.15 FAR, and there are those other - not exceptions, we’re calling them - Mr. Emslie: Special circumstances. Commissioner Holman: Special circumstances, but not to include PCs. I wasn’t in favor of PCs anyway, as you heard me say earlier. I’m certainly not in favor of them in RT35, and if we’re trying to more or less encourage them, I look at the map of downtown and PCs are kind of like the de facto zoning. I know we’re trying to curtail them more here, which I much appreciate, but I’m certainly not in favor of PCs in RT35. Chair Burt: I guess in my own mind I’m unsure about how I will ultimately come down on this proposal, but I’d like to see what Staff would come back with on that as an alternative for us to discuss on the 21st. So, I’m not saying I’m committing towards supporting it, but I would support seeing how Staff would articulate a plan reflecting those concepts. Kathy, it was your proposal. Commissioner Holman: I guess also there’s still this factor of there was a group of a lot of people with Staff leadership that did work on this for a long time, so I appreciate the comments of the commissioners. I know we have a job to do, too, and I’m a little distraught at seeing the plan be changed fairly significantly from what that group recommended. Commissioner Cassel: And my concern is that when we did the economic analysis, we don’t even come close. So if we aren’t coming close to producing what even Staff though was possible that little up and down in the economy isn’t going to make a significant difference [inaudible]. Commissioner Holman: Yes. Commissioner Cassel" Trying to get housing not in big clumps, but in small amounts scattered around. Commissioner Holman: And I appreciate that. I just don’t think we’re in a small slump. I think we’re in a big, old honking slump that’s going to change. Commissioner Cassel: And at those times we don’t build anything. Commissioner Packer: I don’t know if anybody had the time to read the articles that have been the San Jose Mercury News about housing, but if you read about all the obstacles there are for building housing, anything we can do to stimulate a little bit to overcome some of those barriers, we should be seriously considering. Chair Butt: Well, we are ten minutes to 11:00, and we’ve hit the big issues. Let’s look at the remaining items and see whether there are issues that we think we need to give Staff direction on or have they had an adequate sense from the commission on most of these things through our discussions tonight. Commissioner Cassel: Well, we haven’t discussed the minimum density. That’s a biggie. Chair Burt: Okay. City of Palo Alto Page 5 7 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3O 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 46 47 48 Commissioner Cassel: There’s a lot about historic preservation we haven’t discussed. Chair BuLt_: Well, we haven’t discussed them, but do we think that we have differences in our recommendations versus what is within the Staff and working group recommendations? That’s the issue. We don’t have to discuss it if we as individuals don’t think that we have issues to raise compared to those alternatives. Commissioner Cassel: Under process I have a number of major issues. Chair Butt: Okay, so let’s focus on those things that we commissioners think are important in the next few minutes that they would have recommendations differing from working group and Staff alternatives, because with the exception of the residential density and process, working group and Staff recommendations are pretty close to the same. Ground floor office has a difference, too. So, non-conformation uses - are we comfortable with Staff and working group recommendations? Ms. Furth: I’m not comfortable with them. Chair Burt: Okay, Wyrme. Ms. Furth: Here’s the problem. We’ve been trying to figure out how to explain this in a way that we can understand, let alone try to convince anybody else. Our code talks about non-conforming uses and non-conforming facilities. Non-conforming uses are uses that used to be legal, but now they’re not. Cleaning, dry cleaning, very big dry cleaning plants or something like that. Then we talk about non-conforming facilities. As you all know, a very large number of the buildings in the SOFk, II area are non-conforming facilities because they were built higher than any of the FAILs you’re talking about. But it gets worse. We have different rules about non-complying facilities and non-conforming uses, and non-conforming uses are eventually going to turn into something else, and non-complying facilities can be used, but they can’t be expanded, and so on and so forth. What makes it hard - and sometimes impossible - to understand what we’re supposed to do is, you don’t have uses allowed on sites. You have uses allowed at certain FARs on sites. So you can’t say a particular building is or isn’t oversized unless you know what the use is. So this leads to some interesting questions when you have a building that would be perfectly legal and complying if it was used for residential purposes, but not if it’s used for retail, and even less if it’s used for office. Chair Burt: I don’t think we have a significant number of buildings that are aboveFARs in this area. We have non-conforming parking. Ms. Furth: No, but you do for particular uses. Chair Burt: Oh, I’m sorry. So you’re saying under the commercial, basically the example would be if we have buildings that are a higher commercial FAR.. City of Palo Alto Page 58 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 Ms. Furth: It’s not the intensity of the building per se. It’s when you use a particular usel Chair Bu~: Okay. Ms. Furth: So that has created and will continue to create some confusion about how it doesn’t make a whole lot of sense to have a building where you can use two-thirds of it, and the other third is supposed to be unoccupied or an impossible housing unit, but we’re not quite sure what to say here. Chair Burr: Okay, so you don’t have a recommendation yet? Ms. Furth: No, we need to tell you that what we have here isn’t clear. The other thing is that if you read - The CD district has a different set of amortization provisions for usage than the rest of the city. Chapter 18.94, or whatever it is on amortizing uses does not apply in the CD district, and the CD district appears to have a more stringent rule about not continuing to change non- conforming uses, one for another, so that you don’t change a retail use to an office use, even if they have lower parking, so it would be helpful to have your notion about how things should work in SOFA, but not in technical terms, but just in terms of what’s on the ground there, and how you think it should be treated in the future. Chair Burt: And really the problem is we have things like some of the offices and automotive that could not be built under the proposed limits, and they exist today. That’s what it boils down to. What do we want to do about that? That’s your question? Ms. Furth: And what about - I think I know that answer to this, but you have a - We’re not just not going to allow any more ground floor office. You have a building that is being used - Maybe you eliminated the problem is if you eliminate all new office, because what this problem is going to be, if you had a commercial building and somebody proposed to put office uses in, how much of the building could they use for office. Can they use the whole building for office if they only use it up to the permitted FAR, whatever it is? If you’re not permitting new offices anyway, then maybe if it’s the lowest FAR use, you’re not going to permit new ones anyway. That may have taken care of that use. Chair Butt: So this is an issue where we are existing local serving businesses that might convert to office as we’ve seen over the last year. Ms. Furth: Anything below that, yes. We haven’t. Chair Burt: Yes, and the question is, would we want to allow that to occur. If they are commercial fight now, but a different type of commercial - they’re either retail or local serving business services - and should they be allowed to convert to office. Is that the question? Ms. Furth: Eliminating conversion to office, and that may be - Mr. Emslie: Well, we’ve come right to the precipice and not jumped over. I think that’s the issue because we’ve talked about we’ve limited the conversions, so there’s very few instances where you’re going to be able to convert anything that’s in the ground floor ordinance, so there’s a very narrow band that would even qualify for what you decided you wanted us to not eliminate, but to restrict further, so there would still be some provision to allow office in a very narrow area, if City of Palo Alto Page 59 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 you found something that was exempt from the ground floor retail. So we’re very close to - So in some ways it does address the problem of the use of existing building. Ms. Furth: We also need to be clear, I think, on in some parts of the city, we allow - when 1894 applies, we allow conversion of automotive seocices to office uses, for example, because they’re less intensive in terms of parking demand and so on and so forth, but there is also in some parts of the city a more restrictive rule that basically says that a non-conforming use doesn’t change to another use, even if it’s less restrictive. It’s got to go straight to conforming use. So if you have - and maybe again, by your restriction on conversions with your decision tonight to want to continue a conversation program, and [inaudible] in the process here. This may not be a problem. If you have an automotive service use, it’s not going to be able to convert to an office use, because you said no office uses can’t be office uses. Mr. Emslie: It’s the conditions of the ground floor. Ms. Furth: Now that’s only for the ground floor’, so if they’re upper floors in - Does this exist if the upper floor is in service uses down in retail or service? Chair Butt: Well, how about this then. If this is a valid issue that, one, we probably can’t fully explore tonight in the next 30 seconds or 60 seconds, but why don’t we hear back from Staffon how much problem remains? We may have virtually eliminatedthis problem through the other decisions we made tonight. Ms. Furth: Get rid of the rest of it. Chair Burr: Ms. Furth: Chair Burr: More people don’t have to worry about the rest if it’s small enough. We’d like to have answered what we’re supposed to do. No, but I’m saying that the rest may be such a small potential for conversion that we’re satisfied. Ms. Furth: So above first floor would be small enough, so we won’t worry. Chair Burr: Let’s hear back from Staff on how much problem remains with these other - Mr. Emslie: we need to have that discussion before you go on vacation. What, today is your last day? Ms. Furth: Friday. Chair Burt: Karen? Commissioner Holman: Can I throw out what I think would be an easy thing regarding parking, which would be to require that all existing and new businesses comply with a 40 percent TDM program. City of Palo Alto Page 60 1 2 3 4 5 6 7 8 9 10 11 t2 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 Ms. Furth: No, I don’t think that’s so easy, because I don’t know about whether a 40 percent TDM program would work or what it means. So I think you’re being [inaudible] specific. We’re willing to explore that, in fact, we talked about it earlier, but [talk over]. Commissioner Packer: I’m concerned, because there are a lot of small businesses with one or two employees. I think there’s in the plan it talks about the city having an area-wide TDM program that they could participate in and be something that has more teeth in it, like an assessment district, but you have so many small businesses. How can you have a TDM program when you have all. Chair Burr: Well, maybe one altemative- CommissionerHolman: You exempt the ones that are smaller. Chair Burr: Or an altemative might be that those that are too small to have their TDM program might contribute to essentially a collective program, and that might contribute to extending the shuttle system to there or something like that, so we might have some nepotism where they would do some proportionate contribution. Mr. Emslie: I think this would be another area of where you wouldn’t want to develop it all in this plan, but you would want to put it together and have that be worked on by Staff. I think you can do that. Chair Burr: All right. Commissioner Holman: discussions and such. And the 40 percent isn’t out of the blue. It’s come from Staff Chair Burt: So we have two things that we have not discussed and I would like to propose that we roll them over into our next meeting. Residential density and process. They might be fairly easy to achieve consensus on. We’re after 11:00, and I think I’d like to push those over into the meeting on the 21 st. Commissioner Holman: And there might be a handful of other things, too. Commissioner Cassel: Well, I have a couple of things that need to be read as questions to the Staff. Chair Butt: Okay, go ahead. Commissioner Cassel: In the details of this plan, there’s discussion about gateway entryways, and I have no sense in here of who would pay for that or how that would be done. There’s three different discussions on what - or seven different discussions on landscaping, trees and are they consistent, and I think that needs to be reviewed and that’s doesn’t need to be discussed here necessarily. There’s some special height restrictions in this area now for commercial properties that are located within 150 feet of residential development. What happens to those special restrictions with this plan? And with mixed u~e application of this plan - how does that relate to it? City of Palo Alto Page 61 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 I’ve been concerned about all uses and you’ve been discussing that somewhat. How do we retain those and are we trying to get rid of them, and this plan has got[inaudible] but I’m still concerned about them. The public art that’s discussed in here. That we should be encouraging public area, but if there’s no PC involved, the only places we’ve been having any teeth about getting any public art is with the PC. We just eliminated it. Chair Burr: I’m sorry. What did we eliminate? Ms. Furth: You could have added it if you want. Commissioner Cassel: It’s not in the list of things that we’ve got there objecting to that being used as a public .... Chair Butt: Actually, I think the objection has been as that as essentially the only public benefit. I don’t think there’s an objection to public art being benefit. Commissioner Cassel: Okay. I don’t know of any situation which has been the only public benefit, but that isn’t how to public perceives it. This isn’t the discussion for tonight. The point is that is worded in this plan in such a way that it’s highly encouraged to have this public art, but there is no mechanism for how you include it, how you review it. It wants to be reviewed by the Public Art Commission. That seems a little strange for something that’s totally nice. Reviewed by the Public Art Commission, but is this only public voluntary review, or is it only voluntary review? How does that fit into the plan? I read these permitted uses and conditional uses to read that multiple family housing is a permitted use, and that the conditional use isn’t a permitted use or a conditioned use. I want to check that out. Who determines compatibility? This goes back to this question of process, and I think we’ll discuss this under process because under process, if you could the number of building that are being proposed to be reviewed by this HRB ARB, all the 14 building, 78 sites and only 14 don’t bump into something else. Who makes the decision if a building should be reused? There’s no questions here that we’re encouraging you should be reused as anything else but if you’re doing this as as a right, can you demand that? Are there definitions in here that are different from the existing definitions. Mr. Emslie: We’re working on those. Commissioner Packer: There’s a couple of other details. In the design guidelines, there are things that we’d like development standards especially the... _Mr. Emslie: Yes, we’ll sort those. Commissioner Packer: I want to be sure to look at this issues on driveway, fences and walls, landscaping and all those things and see how that is going to impact these FARs and things like that. City of Palo Alto Page 62 1 2 3 4 :5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21, 22 23 24 25 26 27 28 29 30, 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 Ms. Furth: Well, there are also circumstances in which [inaudible]. Commissioner Packer: Right. This area where you have. Ms. Furth: There’s simply some inconsistencies that we have worked on [inaudible] [talk over]. Commissioner Packer: There was something. You have to have a three-foot landscape pocket along all sides of our frontages. What? All along? There would be no way to get in. You’d have to jump over. Ms. Furth: Completely fenced, completely hedged around parking lots that you can’t drive into. Chair Burr: What’s life without a few challenges. Okay, I have one more, real quick. In our new urbanism concept, public domain and enhancement of pubic domain is a major part of it and we really don’t have many opportunities in this plan to do so. I’ve had this pet interest in taking advantage of doing something significant with a spare lane that exists on High Street. We have an anachronism of two lanes in one direction that came about not because of traffic volume needs, but because of a need to turn dairy trucks into the creamery. Staffhas clarified that unfortunately there is not adequate street width to put diagonal parking on one side, and so I would like to very much explore eliminating one of those lanes and utilizing High Street in some or all of those blocks as a way to really enhance the pedestrian amenities and make that a very attractive pedestrian space, and not attempt to determine at this time how to do that, but I think it’s a bunch of public land that could be used to enhance this whole plain area and make it come together without having the expense of land acquisition. Commissioner Schmidt: If that is done, there must be adequate provision for loading for Whole Foods, as people who go by Whole Foods at different times of day. I go to Reach almost every morning and there are always many trucks double parked on High Street, so you would not be able to drive down the street between 7:00 and 9:00 in the morning. Chair Burr: We would have to do that, and frankly, we have a need to improve the whole use of the parking space and the loading and unloading, I think that there is a opportunity to actually in several ways improve the serving Whole Foods’ needs and serving the public needs at the same time, and I’m not attempting to determine that plan at this time, but that we should aggressively explore this and all blocks of High there. But I think there’s some real opportunities there for heavy reorganization of that space. Mr. Emslie: Okay. The plan is for us to come back with a lot of this fleshed out in a more formatic version, and that is to happen on the 21st of August. Give that we have a couple more significant issues yet to discuss, the question would be, do you want to fit in another special meeting before the 21st so that we can make the 21st truly the last mark-up session on this. Your next meeting is full, the 14th, so it would have to be another date next week, like Tuesday or ThursdaY. Commissioner Packer: I’m out of town. City of Palo Alto Page 63 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 .18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 Chair Butt: And on the 21st we have tentatively a ZOU study session. Could we instead push that out and have the fence height modifications on PF zones, is that going to be pretty straightforward issue, or is that - Ms. Furth: We believe it’s straightforward. Chair Butt: Okay. Mr. Emslie: They asked for it. .Chair Burt: Who asked for it? Mr. Emslie: The city attorney asked for it. .Chair Burt: He needed it at that date? Okay, but you think it’s straightforward? Ms. Furth: We do. Chair Butt: So then, if we don’t have a ZOU session, we could have the entire meeting on the 21st devoted to this. Mr. Emslie: Chair Burt: Mr. Emslie: Chair Burt: And I’m concemed that you - That that may not be adequate. We would like to. I mean, the next week is probably - Or we could do this. Michael gone next week also? I think he is. Commissioner Holman: He’s back Sunday night, I think he said. Monday, something like that. Chair Butt: What’s the alternative? Mr. Emslie: The alternative is we use the 21st as continued discussion and we bring back what we can so far, and maybe we finalize a couple of the major issues and then we.have another final session. Chair Butt: If required. Mr. Emslie: Well, yes exactly, so that would be clear. We can’t do anything there, and we need to do the study session. Chair Butt: Fourth. Mr. Emslie: This is scheduled for City Council at the end of September, so we could probably do something that second week. We are canceling your September 11 meeting, by the way. We thought that was appropriate. Chair Butt: September 4 that we have? City of Palo Alto Page 64 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 Mr. Emsli_e: Chair Burr: Mr. Emslie: Chair Burr: Yes. I was to keep a ZOU on that. Special meeting? That’s 2300 East Bayshore and that’s a firm date. But is that necessarily going to go ahead? If we have it not on the 11th, but perhaps - Mr. Emslie: Yes, special meeting that week. Tuesday the 10th. I think that would work fine, and then you could just make any final changes just for a guide to the Council. ~ Tuesday. Ms. Furth: And then also we’ll have the environmental review, which we haven’t had any discussion about. Chair Burt: Environmental review is subject to - Ms. Furth: You have the base EIR, but you’ll be getting supplemental - Chair Burt: Okay, so tentatively September 10 for our final one? Mr. Emslie: Yes. Let’s do that. Chair Bun: Is that okay? Mr. Emslie: You need to file the notebook at midnight. Chair Burt: Okay. Thank you. So we will adjourn. ADJOUNED: 11:15pm City of Palo Alto Page 65 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 46 Planning and Transportation Commission Verbatim Minutes August 21, 2002 EXCERPT UNFINISHED B USINESS. Public Hearings: South of Forest Area Phase 2: Continuation of review and recommendations by Planning and Transportation Commission. Chair Burr: What I would like to ask Staff and Commission is we are at 8:20 would this be an appropriate time to take our break and then continue through the balance of the meeting on SOFA 2? Okay, we will take a ten-minute break. Kathy. Commissioner Schmidt: Before we take a break, I will not be participating in.the SOFA Item. Due to Staff recommendations the non-profit affordable housing developer that I work for is analyzing affordable housing sites for the City and affordable housing is a potential use in this area. Chair Burt: Our regrets that you will not be able to participate. We will take a ten minute break at this time. At this time we are going to continue with Commission discussion of the South of Forest Area Phase 2. Just for clarification we had previously closed the public hearing on the subject and this is a continuation of Commission discussion of a variety of issues associated with SOFA Phase 2. Would Staff like to briefly recap where we left off and then how you are envisioning the items that you need input from us tonight on. Mr. Emslie: Absolutely. We anticipate concluding the discussion of all the topic areas that we listed in the matrix that the Commission has been using to guide its discussion through the SOFA 2 review. We are hoping to conclude the process section of the concerns and dealing with subsequent amendments, the review process, those issues are still outstanding. We hope to conclude those tonight so that we may proceed to our final presentation of the Planning Commission’s consensus and direction derived fi~om the previous discussions over the last several weeks. It would Staff’s intention to utilize this final hearing the first week of September to conclude and to clarify Staff’s translation of Planning Commission direction and to make final changes to that but not to revisit many of the issues that have been discussed extensively. Then that would conclude the Planning Commission’s recommendations.. Those would be forwarded to the City Council who is scheduled to review this the first meeting in October on October 7. Just to recap, at our last meeting the Planning Commission did make an incredible amount of progress and decided on nine areas. I think you had a record number of motions that night. Just Page 1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 to briefly review what those were, first you discussed implementing a daylight plane for the High Street frontages aswell as gave Staff direction to propose a daylight plane or other setback regulation to deal with the visual impacts on Homer and deciding what the appropriate height ratio to setback would be. Staffis in the process of putting that together with the assistance of Freedman, Tung & Bottomley. We also discussed the conundrum of converting office when it goes from office to retail allowing that to revert back if it were done after a certain date to eliminate the disincentive for a property owner to try retail. The concern was that if it were converted and it for some reason failed that would not be an incentive for a developer or property owner to risk putting that in. So that was one area that the Planning Commission asked us to include in the final recommendations. The Commission also gave direction to Staff to reduce the floor area ratio that would be allowed for office in favor of increasing the residential FAR and that is a proposal that Staff is concluding..Also the Planning Commission confirmed that the existing ground floor retail ordinance Would apply to the SOFA area. We also established base densities for the two primary residential zones, the RT-50 and the RT-35. We also established and prescribed special circumstances for exceeding that up to a maximum cap for each of those zones. We also received direction that the plan should recommend the implementation of a transfer development rights program. Clarified that public benefits could be applied in the plan area and not necessarily on the site and that the TDR program would include generalized locations of potential public benefits such as open space. Just to clarify statements that were made earlier we would need to do that in a way that didn’t single out specific parcels but we could do that in a generalized way so that we could target areas without singling out specific parcels, which does raise some legal issues. There is a planning tool that we will devise that will provide the flexibility to avoid any potential legal implications of temporary takings. We will be working with the attorneys on preparing ihat. We also concluded that we would allow a reduction in parking which as you understood from your economic analysis the importance, of reducing parking as a way of promoting the economic vitality as well as taking advantage of the areas in very close proximity to existing public transportation. That was linked to a very proactive and very doable implementation of a transportation demand management program. Then lastly, the plan was to recommend the eventual adoption of the Citywide TDM program that would address reducing unnecessary trips and promoting public transportation on a Citywide basis. So those were the areas that we did receive consensus and/or direction to proceed to develop a more specific proposal. It is our intent to bring that back to you on September 5 and use that as a time to confirm our interpretation of the Planning Commission’s discussions. Chair Burt: Steve, could you recap the Commission’s recommendations on the RT-50 and RT- 35 areas? Mr. Emslie: The specific numbers? Absolutely. RT-50, which we are calling the [Oaker] area, the area closest to Alma Street was at a 1.5 base FAR. Then there was an allowance to go up to a maximum of 2.0 FAR when specific public benefits were employed. The motion was that when two or more public benefits that were listed, I can go over those it was quite a long list, that was the concept. Then in RT-35 the base FAR for residential was 1.15, if it was a mixed-use that included residential with ground floor retail the base would be 1.5 and then the allowance was for a PC cap that would go up to 1.5. All other requirements for public benefit would apply as in the RT-50 except that you would only need to provide one instead of two. Page 2 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3O 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 46 Chair Burr: I should note for the record that Commissioner Griffin was absent at the last meeting and my understanding is you have had an opportunity to review the minutes and you are up to speed. Is that correct? Commissioner Griffin: Yes. Chair Burr: Thank you. Karen. Commissioner Holman: Clarification, Steve if you would please. On converting office to retail and back I was the one that made that comment and I was referring to existing office. Mr. Emslie: That is correct. That only applies to existing. If someone wanted to take an existing office, convert it to retail, after a certain date so that it would be clear that any new office would not be included. So that is a clarification that Staff understands. Commissioner Holman: Just one other quick clarification please. Various people have been in agreement with other Commissioners and in so many instances we haven’t .been so is that going to be reflected in any way? The minutes will be available to Council. Will that be reflected in any other way to Council? Mr. Emslie: What we are proposing is a summary sheet similar to the issues summary sheet that you have been using and I think have been finding useful. Staff finds it useful. We propose expanding that so that each of the policy areas that the Planning Commission does have consensus on we can reflect the actual votes and record that in a summary way so there should be a direct relationship between the action and the actual Planning Commission decision on that. We think we can accommodate in a summary fashion that reflects the differences of opinion. Chair Butt: Bonnie. Commissioner Packer: I just had a question. Didn’t we do something about the comer of Homer and High in terms of a daylight plane? The Homer corridor where the RT-50 is. Mr. Emslie: Yes, ifI failed to mention that that is clearly my fault. We are working on a corridor setback along Homer to deal with the minimizing the dominance of new construction on the historic Homer corridor. So that is something that we are working with Freedman Tung on, they are helping us develop that. In fact if there are questions we do have Freedman Tung present and they have done some analysis of that already. It is not complete but they are prepared to discuss that. Chair Burt: Karen. Commissioner Holman: A follow up to that. I think additionally we had agreed that Homer Avenue would be a 35-foot height. Then what Bonnie was just mentioning and I recalled it as being, and I am afraid I did not go back and check the minutes on this, but I remembered it as being just the two parcels at Alma that we were looking at doing a step back and not how it is indicated on this map. Page 3 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 Mr. Emslie: The question as Staff understood it is that yes, there would be a 35-foot height limit on Homer. The question is how far that would go back, what was the right distance. We were going to do some visual analysis to come back to you with what we think is the proper distance that you would allow something t° go higher than 35 feet. There was a debate should it go the full lot, the partial lot, and that is where we need to do the analysis. We have actually started the analysis and that is just that two lot area between High and Alma because that is the only area that would be affected by that. The rest of Homer is 35 feet so there is no need to decide where you can step up higher than that. Commissioner Holman: I guess we are still not quite on the same page here. I am sorry about that. I was thinking that our discussion at the last meeting was that we were talking about the, I know Palo Alto is not oriented north-south but I am, but we were talking about the north and south comers of Homer at High and step backs there, excuse me, at Homer and Alma not at Homer and High. That was my recollection. Chair Burr: Phyllis. Commissioner Cassel: My recollection was that it was both lots so that you have this corridor coming down the. street and the question became how far back on Homer, is it the whole lot or not the whole lot. And it is both of them because we want both of them to be consistent I would think. Chair Butt: My memory was that we were wanting some degree of a 35 foot height along Homer and that Staff was going to come back with a recommendation on what amount of setback. If we are unclear on that then we could just simply revisit it again tonight and give greater clarity to Staff on that. Mr. Emslie: To maybe assist what we are doing is analyzing how far the offset would be between the 35-foot height that clearly would be on Homer and at what point would that be allowed to go any higher. That would be for these two areas on the map. As I mentioned we are not finished with that so it is very possible to have further clarification as to how you want that to apply. Chair Burt: Then the Commission is still going to have the final decision on what they want to accept on that. Mr. Emslie: To see the results of the visual analysis, yes. Chair Burt: I have to ask one more time. You recapped the RT-35 and there was a segment of that where I wasn’t clear on what you said. Could you do it one more time for us, Steve? Mr. Emslie: RT-35 for purely residential projects there wouid be a base of 1.15, for mixed-use residential and ground floor retail there would be a base FAR of 1.5 or you would allow the application of a Planned Community cap of up to 1.5.provided that all the public benefits that Page 4 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3O 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 46 were listed in RT-50 it had to have at least one of those public benefits in your public benefits package in order to get the 1.5 cap in the RT-35. Chair Burt: So ifI understand that correctly by right the residential and retail project up to 1.5 would be allowed but a mixed-use with other commercial would require a PC. Is that what you are saying? Mr. Emslie: No a mixed-use with commercial would be allowed by right up to 1.5 FAR. That is how we recorded it. We can certainly go back and check the minutes. Commissioner Cassel: And the PC is not for the mixed-use if it was just residential? Mr. Emslie: Correct. That is how it would shake out is if you essentially wanted to go higher than 1.15 for residential you would need a PC to go up to 1.5. Chair Butt: So we would require the PC for the residential and not require it for the mixed-use with commercial? Is that what we had agreed to? Michael having read the minutes is saying yes. Bonnie. Commissioner Packer: I think we probably were a little confused and maybe we want to think that through again and see if it makes sense. Let’s say somebody comes in with a PC and it has ground floor retail and has residential in the RT-35 then we can go up to 1.5. I think what we were thinking about for PC is allowing more FAR and it was predominantly residential. I don’t think we were saying that only purely residential projects because if you have a .4 limit on the commercial anyway or a percent, maybe we want to have a percentage of the FAR that is commercial in such a PC so that if you wanted to have a mixed-use with some kind of ground floor you could have it. Commissioner Cassel: Are you thinking that’s backwards, that we meant it the other way around? Commissioner Packer: Yes, when I was talking, because I kind of made this proposal I don’t have any objection to having a PC that has ground floor retail or some kind of pedestrian friendly element to it and all the housing is on top. Chair Burt: I don’t remember exactly how we left it but I certainly remember what I was trying to advocate which was we create a circumstance there where we reduce the incentive to build mixed-use including general office and increase the incentive to build a mixed-use that would be residential and possibly retail commercial. That was the ultimate outcome that I certainly was advocating. Commissioner Cassel: I don’t know how that is accomplished by having a PC for 1.5 residential and having it non PC for the other. Chair Burr: Agreed. I didn’t think that as Steve characterized it would create that incentive. I think that proposal in a way would create a higher burden for a overwhelmingly residential Page 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3O 31 32 33 34 35 36 37 38 39 40 41 42 43 44 1 project than for a mixed-use containing office, ifI understood it correctly. My concept was to’ 2 have by right less office allowed either by having a lower FAR allowed on the office or perhaps 3 also a lower FAR for the combined use, perhaps a 1.0 FAR, for a mixed-use that would include 4 office and a higher allowable FAR whether it be by a PC or by right for a residential/retail 5 project. Karen.; Commissioner Holman: You know how I feel about this. I think, we simplify this a whole lot if we just eliminated the office component. We have a lot of office down there as.you said too and I won’t argue the same thing that I argued last time but I just don’t think we need anymore new office down there. I think it would simplify this conversation if we could come to some agreed conclusion of that. Chair Butt: Michael. Commissioner Griffin: That is my recollection. The way the minutes read was that you had had this discussion about prohibiting new office. New office, there was almost the innuendo that we are talking about construction and that people that had office existing could flip back and forth but there could not be the creation of new office. I thought that eventually you bought into that even though you had spent a fair amount of time talking about that .25 process. Chair Burr: Bonnie. Commissioner Packer: I think we are in a phase in our lives where people are just very much opposed to office. I think we have to be broader in our perspective and allow some flexibility. It may be that a project comes in on Alma Street you can use 753 Alma as an example. That is considered mixed-use because the Housing Corporation has an office in it. Alma Street is a place that is not very inviting to pedestrian retail.. So you may have a situation where it is economic for a developer to have a ground floor office on a non-pedestrian street like Alma that would provide the incentive to make everything else residential. So I would hate to eliminate that kind of flexibility and make a blanket restriction on office. I would like to figure out thought the best incentives we have to have residential above the first floor and it could b’e residential on the first floor if that is what works for the developer but if they want to come in with a PC at 1.5 and a small percent of it can be office or some kind of commercial, whatever makes sense from a market perspective at that given time. In ten’ years that may be what makes sense and maybe it is flooded with all the other retail and there isn’t any market for retail. So that is why I think we want to keep the incentives there for residential and not put too many constraints on the type of commercial but do limit the square footage for commercial. Do you follow what I am saying? Chair Burt: I do and that’s why I had been advocating something along the lines of this .25 FAR limit on the commercial and I thought that would be a reasonable compromise that would reduce the incentive to build office without being overly heavy-handed and increase the incentive to build residential. That was the basis for my thinking. Karen. Page 6 1 2 3 ~4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 46 Commissioner Holman: Just a clarification. Office has never been precluded from Alma. That has always been allowed along Alma. Lisa is shaking her head in acknowledgement that we are talking about streets other than Alma. Commissioner Cassel: I am not sure we have a consensus now and I don’t think we had a consensus when we left last time. Chair Butt: Let’s see, is it worthwhile to see whether we can have one at this time? We have had a little more discussion. What do people think about the prospects that have been laid out? Phyllis. Commissioner Cassel: Let’s see if I understand the prospects that have been laid out. I think that is my first problem. There is an RT and RTP, right? I am assuming you are doing everything the same. Mr. Emslie: The P is a vestigial remnant. It will be corrected in the plan. There is really RT as all one combined district. Ms. Grote: Those P regulations, which are the same as the P, Pedestrian Combining Districts, are actually written into the standards and the guidelines. So that P in essence applies to the entire area. So it is not needed on the map because it is applicable to the entire area. So we jiast need to remove it from the map. So there is Residential Transition as we have called it as kind of a placeholder, RT-50, which is the higher height limit and a little bit greater density and then RT- 35 which is the 35 foot height limit with a little bit less density. Both are subject to the P Combining District regulations, which talk about the setbacks and things like that. Commissioner Cassel: Okay, to make a mess of things I was thinking in terms of that P having some effect or having retail emphasis. Chair Burt: .They just clarified that it doesn’t. Commissioner Cassel: They don’t. That’s too bad. Chair Butt: Maybe I can take a stab at trying to pose a couple different options to the Commission. One would be would we want to in the RT-35 Zone change the allowable commercial from .4 to .25? Second consideration would be do we want to have a different allowable FAR for a mixed-use project that would include office versus a purely residential/retail project? Those would be the two questions that I would pose to the Commission. Commissioner Holman: You are saying general office? Chair Burt: Yes. So the objective being to create greater incentive for a residential/retail or all residential project than for a mixed-use which would include general office. They would still be allowed to do it but they could build less FAR if they went that route. Bonnie. Commissioner Packer: Are you talking about as of right as opposed to a PC? Page 7 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 Chair Butt: That brings up a third question which is within this FAR would we allow a certain amount as of right or all of it as of right? We could have a certain amount that is as of right and an additional amount from a PC or all of it as of right. So really we have three questions before us then. Commissioner Packer: I guess my concern is that when we are dealing with these very detailed numbers, .25, I don’t know what that allows on a 5,000 square foot lot or the 10,000 square foot lots that are so common here. Chair Burt: Can I try to explain that? One thing that might be informative is that ifI understand this correctly and Staff maybe can clarify, with the current constraints on ground floor office the proposal before us right now is not very far off from restricting a .25 on general commercial, if I am understanding that correctly. Can you clarify, Lisa? Ms. Grote: That is correct given restrictions on ground floor uses and parking and other site development requirements. That’s correct. It is not much different. Commissioner Packer: So my question, Pat then is, if we went with the as of right number, let’s say we do 1.15 and if you Want mixed-use it could be 1.5 but no more than .25 for this commercial use, however, if you have a different proposal that is going to be .3 or .4 you could try your PC application and see how it all works itself out in terms of the balancing of the public benefits and the relative amount of retail, the .type of commercial, things like that that would allow a developer some flexibility in the PC environment. Chair Burt: Just to clarify what my intention was which may not be the concurrence of the Commission, it was if we are going to allow a PC for a greater FAR in thatarea it would be to allow it for residential and not for general business office. Commissioner Packer: I agree with the concept I just wonder about the workability when we are dealing with percents. Somebody comes in and it turns out that their proposal is .28 instead of .25 can we have some language or something that allows some realistic flexibility? Chair Burt: I think we draw the line somewhere. I would also be comfortable if tonight the Commission was uncomfortable delineating exact FARs to give Staff conceptual guidelines and let them come back with proposals to reflect that that they think are workable. I would be comfortable with that I don’t know if the rest of the Commission Would. Commissioner Griffin: Isn’t that what you asked Staff to do the last meeting? I thought that there were a number of presentations that were going to be forthcoming on the ,part of Staff and presented to us tonight. Chair Burt: We did that on certain things and not others. Some things we did specific recommendations and others we asked Staff to come back to us with specifics in response to our generalized recommendations. So I am saying that if we were in concurrence on a generalized Page 8 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40. 41 42 43 44 45 46 recommendation then we could ask Staffto come back to us with a specific proposal for the fourth. Commissioner Cassel: Pat, I guess I am still uncomfortable with reducing it to the .25 as you have said. I am uncomfortable even making the very tight restrictions between general office and other kinds of office and retail. So I am finding what you are suggesting even more ¯ uncomfortable. In all of the reading that I have done I am not sure that I catch that in this area are we really talking about using the Downtown guidelines for ground floor retail and those restrictions? Are these slightly different restrictions? Mr. Emslie: What we took was the application of the Citywide ground floor retail ordinance. We are confirming that it will translate into the SOFA cap. Commissioner Cassel: So let me see ifI can restate what that does. What it would do is require retail on the first floor but if the unit could not be occupied within six months then it could then be used for another use. Ms. Grote: Actually the Citywide ground floor use restrictions are applicable to existing uses. So if you have an existing retail, personal service, automotive service, restaurant or housing on the ground floor, you cannot convert those uses to office use. So that is what I think you confirmed you would like to have remain in place in the SOFA 2 area. So if there were those existing uses on the ground floor they are protected. As far as the new uses are concerned, if a brand new building is built, then they would be subject to the permitted uses that are listed in the ordinance and there would be those restrictions on office use as you have discussed so far which would be along Homer and along Emerson and then you have gotten into some further discussions on where you would like to limit new office use. Chair Burt: Lisa, just clarifying. You said that those existing retail or business services would be protected but actually they would be protected from being converted to office not protected in mandating that they stay those present uses, correct? Ms. Grote: That is correct. So they could change in and amongst themselves but they could not be converted to office. Chair Burt: And they could be converted to residential. Ms. Grote: They could be, yes. Chair Burt: Karen. Commissioner Holman: Actually that is where I was going Pat, you read my mind. One thing that is in the Downtown ordinance is that residential can also not be converted to general office, correct? Ms. Grote: That is and that is in Citywide as well, yes, that is correct. Page 9 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23, 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 46 Commissioner Holman: Citywide, I shouldn’t have said Downtown. The other thing that I would propose that we add to the SOFA ground floor is that residential wouldn’t eliminate an existing service or retail. In other words if the property were redeveloped then a comparable amount of square footage would still have to be devoted to a retail or neighborhood serving use. That is again to reflect the nature of the area. One of the charges of Council was this is an eclectic area. Commissioner Packer: I think we need to be careful about trying to manage the economics of this area. I am a little bit nervous. If a project comes in and it is entirely residential and it replaces an auto shop, are you saying then that project has to find space for the auto shop? Commissioner Holman: No, what I am saying is that whatever the practical square footage is that the auto shop itself would use’ would have to be devoted to some kind of neighborhood serving retail. Commissioner Packer: We had that report and I don’t know how valid it is, the Sedway report. It talked about the impact with everything converted to retail whether it would maintain itself. I think we have to allow the market to determine what is going to be viable in some of these spaces and not require that there be 100% retail or have to preserve it. I think we have to rely on some of the design standards, how things look to make the place good and maybe that will help the retail but not to say it has to be neighborhood serving retail. I was thinking about this. We all like neighborhood serving retail, it is really nice and warm and feels good. But there is a reason, I believe a good economic reason why we don’t see a lot of it is that it just isn’t economic for mom and pops to have retail. I know it was hard for my dad with his retail store. It is not always that easy and you need a certain amount of density of population to support these things. If we are not going to be building the housing density to support the retail then what are ’ going to require the retail for? It is kind of like if we are not willing to put housing density along transit then people aren’t going to be using the transit. We have got to figure out what is a reality that will really work. We have to come to grips with this and we can,t always have the nostalgic morn and pop neighborhood serving retail. It may not happen and if we dictate it we may end up with empty storefronts. We just have to be really careful. There is the other Downtown that draws the customers there. There are all these issues. So I would be really reluctant to micromanage the economics of this area in that way. Chair Burt: Michael and then Karen. Commissioner Griffin: It seems like we have two approaches to achieving the same goal here. Yours using this .25 FAR methodology and one that Karen has been championing for the last couple of weeks, which basically is the reiteration of the Working Group recommendation about no new ground floor office along Homer and Emerson and no ground floor office south of Homer except Alma Street. The goal of both of these methods is to diminish the impact of office uses in the SOFA Area. I think we are going to have to decide which one of these two methodologies is the most straightforward and accomplishes our goal the most efficiently. Steve, last week you talked about the pros and cons of this. Could you resume this for us because I think we need to move on? Page 10 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31- 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 1 Chair Butt: I would like to clarify, I believe that Karen’s latest recommendation was having to 2 do with something in addition to that which is that any new construction at the site that has an 3 ¯ existing either retail or business service, it is not just retail as defined here, that new project 4 would have to replace an equivalent amount of retail or business service that was lost. That is I think something different from what you were just summarizing. Commissioner Holman: It is additional to what he was saying. Chair Butt: Just real quickly I might add that there is another approach, which is that if we want to incentivize retail we do it with FAR bonus for retail and we just don’t give it for the office. Karen and then Phyllis. Commissioner Holman: A couple of responses to Bonnie’s comments. The latest Sedway report is based on, as I read it, an inaccurate assumption. It says it is based on all existing office having to convert to retail and that is not at all what anybody has recommended. No matter what we zone there is the potential for empty space. We can say we are going to zone for ground floor retail and face the possibility of having open storefronts. We have allowed office now and we have an awful lot of open window fronts because the office market is dead. So there is that possibility no matter what we zone for. So from my perspective I think what we do is zone for what we want, zone for what we think the community needs. Chair Burt: Phyllis. Commissioner Cassel: We are having a hard time with this because it is complex. It is not an easy one. In some ways while we can micromanage this thing street by street if we want we are going to have to let the market do some of this. Take Midtown as a good example of an area that really wants retail, has been seeking retail, we have had a down market when it was about one- third empty and we have had an up market when it still had empty spaces. It has been very hard to fill all those spaces and it is serving a fairly good size area of people that have a distance to go to someplace else. And it is fairly walkable for the neighbors. There is a maximum amount of small retail that you can put in there. The other thing I think we are missing is that one of the most favorite stores in this placer has to have and could not exist if it was in a 2,500 square foot space, it must have 10,000 square feet I would guess on Alma, the hardware store. It has got to have it and that’s a retail space. Chair Burt: There is no restriction proposed. Commissioner Cassel: On what’s there but we are not allowing it to happen again either. Chair Burt: Not in the retail. We are talking about office. Commissioner Cassel: When new buildings are built they Can only have spaces that are .4 FAR which means you have to have a pretty large lot to put in a reasonable size retail space which is true. Chair Burt: Yes, under that sense: Page 11 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3o 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 46 Commissioner Cassel: So this gets really complex because you want a place like that hardware store down there and that is very neighborhood serving. Chair Butt: Right, but that is not being proposed to be affected under the proposals that I was advocating. That may be a valid issue as to whether we have created a circumstance with the commercial constraints that would include retail within that that we would not be allowing any larger retail establishments to take hold. That is not what we are talking about in the office constraints. Commissioner Cassel: I know and I would rather see moving this at the .4 FAR and I would rather leave it more flexible than we have been leaving it to do various kinds of office. I would love it if we could really be tighter on Homer and Emerson because I think we need some center. What we are missing in this is a real nice center to that space for that retail. Chair Burt: One principle that I would just like to reiterate, you and I have discussed this before, when you say letting the markets dictate it. We have zoning that creates the market constraints, incentives and disincentives. Existing zoning does it and changes to zoning does it. So the market isn’t something that just. out there without any boundaries. The market exists within boundaries and what we are talking about is how we might want to change those boundaries to incentivize certain outcomes that we would like to see. I think that is the discussion that we are having. This notion that we just have to let the market function, the market already has constraints and we are talking about whether we do or don’t want to change those boundaries. Commissioner Cassel: I will agree with you but the question is how tight should those constraints be perhaps and not should we make those changes and constrain those areas. Maybe we should just try with do we need 1.5 for all residential, do we need a PC, and see how we do.. Chair Butt: Okay, we could work from that direction backward then. Maybe we will get somewhere on that. So let’s pose that question. How does the Commission feel about a PC within the RT-35 Zone that would allow up to a 1.5 FAR in the PC and the question is that a pure residential PC or is that a residential/retail PC up to 1.5? Commissioner Cassel: Or a mixed-use PC? Chair Burt: Or a mixed-use residential/office/retail/business service? Commissioner Packer: I like the idea of allowing some mixed-use but making it a very small percent of the residential in order for the PC to fly. So it has to be primarily residential but how do we define the primarily? I guess you are doing it if you have a 1.5 FAR and another point- something for the non-residential element that is the same way’of saying it is a percent of the residential or is it? Could we say it should be no more than five percent or ten percent? How would we do that? Chair Burt: This goes back to where we started that I am not sure any of us feel comfortable with setting the precise FAR limit tonight. So if we go with the concept, maybe we are Page 12 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 46 comfortable with a maximum FAR and that discussion of a 1.5 and then provide Staff with a request to come back to us with a formula that would reduce the incentive for office, increase the incentive for retail and residential within a maximum 1.5 FAR on a PC in the RT-35 Zone. Is that a concept that would at least be acceptable to allow Staff to come back on September 5th with a specific proposal that they think would work within those conceptual parameters? Commissioner Holman: I would make a proposal actually and see if this would ’fly, I don’t know if it will or not. That the base FAR for purely residential or mixed-use excluding general office, no general office, have a base FAR of 1.15 and that a PC could have 1.5 either all residential or mixed-use and the current .4 could apply for non-residential but no general office. Base FAR of 1.15, a PC could take it to 1.5; no general office in either. Chair Butt: Commissioners? Commissioner Cassel: I prefer Pat’s proposal. Commissioner Packer: I would like to ask, are you talking about specific streets because I thought we agreed that genera office was okay on Alma? That is why I am getting a little confused with your proposal. Commissioner Holman: Alma is always excluded fxom this because Alma has been set aside as separate I think in previous discussions that office is allowed on Alma. Commissioner Packer: There is a lot of office there now and I don’t know how long it will last but office is often a supplier of customers for retail such as lunch places. So we have to keep that in mind. Commissioner Holman: Correct, and existing office is being allowed to stay. Chair Burt: My concept on this is we had talked about this being a mixed-use area. We over the last four years have achieved one-half of that mixed-use, the office. We don’t have the other half. So I think we have to do very little to try to encourage or even allow much more office there. What we don’t have is the residential half. Commissioner Griffin: I want to flip this back to Staff and ask you folks if you have any comments on this? You see the goal that we are trying to achieve, which of these appeals to you and why? Mr. Emslie: I think we would look for maybe a little bit more direction than for us to just come back. I think that we are going to be back in the same place because I think there is a fundamental issue. I think there is agreement that the 1.5 is the maximum development that you would like to see whether or not that is by right or PC is still a question. So that is something that I think we would want to get some firm direction on. Then I think the other core issue is whether or not you would allow any office to be developed in the PC application if you wanted to go up to the 1.5 and do mixed-use, would we be restricted only to retail or would you allow office? And if you did allow office, would you do that in some very limited way? I think that is Page 13 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 Chair Burt’s proposal that that be severely restricted. Commissioner Holman’s proposal is that it be eliminated. So I think if you were to perhaps come to a vote on those two items I think we could come back to you with a fairly crisp proposal and kind of maybe cut to the chase when we get back to this on the 5th. Chair Burr: Bonnie. Commissioner Packer: Can I add another parameter? I would hate to see anything in new development above the first floor be used for other than residential. I would certainly support a proposal that said no second floor office. I don’t know if that is doable. Chair Burr: What we already have in the proposal is no ground floor office. Commissioner Packer: On the other hand I would like to have flexibility as to what is on the ground floor in case the economy changes. I just don’t know what is going to happen. This is a hypothetical. Suppose the economy keeps on spinning downward and the offices that are there now start to move out and everything stays vacant for awhile because there isn’t any reason for retail to move in also. Then it is kind of like a lake becoming a meadow. The next things that come in start being office again that encourages retail to come in. You know how you have the different trees come in and then the other fir trees come. Chair Burt: We get the analogy. It does prompt me to think about something. When we have talked about the restriction on ground floor office and then we have talked about allowing the conversion back and forth, if an office converted to retail to allow it to reconvert to office, if we continued with the ban on any new ground floor office we would eliminate the potential for that conversion. If we have a constraint on how much office could be built, so we have put boundaries on the office in that way. Maybe it wouldn’t be advantageous, and I am just struggling with this right now, maybe it isn’t advantageous to prohibit that office from being ground floor. In doing that we have eliminated the possibility of that office being able to be flipped to retail in the future. We don’t have that. Bonnie’s comments caused me to struggle with that concept. Commissioner Cassel: I would like to hear you go through that again. Your original proposal is that you allow general office at .25, that you allow retail at .5 and is it an either/or or is it a maximum? Chair Burt: I think the retail is .4. Commissioner Holman: I am sorry to interrupt you Phyllis but there is a misperception here. The only office that can flip back and forth between retail and office is the existing office. Is that right, Steve? Mr. Emslie: Yes. We understood in the direction that there would be a date established by which any office that was established prior to that date could flip back and forth. That would eliminate the kind of third party converting and putting in an office as a shell and then being able Page 14 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3O 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 to convert that back, kind of a shell game if you will. So there would be a date certain that would prevent that from happening. Chair Burr: Right. I understand that but as Bonnie raised those issues it caused me to recognize that by forcing the office to be second story we may be eliminating a desirable outcome which is that if instead we allow the limited amount of office that we will allow we allow that to be on ground floor and require what at one time the Working Group was looking at is that it must be designed in a way that is convertible to retail and back and forth. A lot of the business owners had said this would be their desired outcome, Then if that office that we are going to allow in that project either way, if it was on the ground floor, could at the discretion of the market and the property owner be converted to retail at a future time that space could be converted to retail. Whereas, if we mandate the office be on the second floor we don’t have that prerogative. It was a new concept that I am thinking about. Commissioner Cassel: I agree with you. Chair Butt: I would be interested in Staff and Alison’s comments. Mr. Emslie: What you are saying is if you eliminate office and retail is not feasible it is going to be most likely residential. If it goes residential it will always stay residential. So you are eliminating the chance for it flip between office and retail. Chair Burt: And if between office and retail it will .always stay office. Mr. Emslie: Exactly, you will never have second floor retail. So under the provisions what would happen if you did allow a limited amount of office it could convert from office back to retail but you wouldn’t get the liberty to come back to office. You would not have that right, at least the way we understand the direction of the Planning Commission, because it will have been put in new after the grandfather date was established if someone wanted to convert that limited amount of office to retail it would then be subject to staying retail that it couldn’t flip. Chair Burt: Not necessarily. I think property owners would not respond to that incentive if it denied them the option of one day returningto office. At least it would give perhaps some greater opportunities for retail as the market would dictate versus what we are currently proposing. Karen. Commissioner Holman: I think we are going exactly absolutely backwards. What we have right now is a situation where the owners can put in office or retail. In up markets office generates a higher income and so the owners go with often times, usually, and that is why we have seen so many conversions of retail and se.rvices to office in SOFA 2 to what brings a higher income. So what you are proposing as I understand it is exactly what we have now and it is exactly how we have lost a lot of our neighborhood serving uses and retail in SOFA 2. Chair Burt: Bonnie. Page 15 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3O 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Commissioner Packer: I appreciate what you are saying Karen but I want to go back to what Pat was saying. If we are interested in having some kind of commercial activity only on the ground floor and none of it above and are thinking about, giving flexibility for developers to flip back and forth depending on what the market is then you don’t want to have a different FAR because if you have only .25 FAR for office it may be too small of a space to allow them to convert to retail. You want to have a little bit of room there. I don’t know what that would be, we have to look at these 10,000 square foot sites and these 5,000 square foot sites and see what it would look like. So that is another consideration if we are talking about the flipping. To Karen’s comment I understand what you are saying and I just don’t know how to deal with it. I myself would love to see more retail but I also at the same time don’t want to see empty places because then having all these empty holes and everything else is residential is kind of scary for the people who live there. You want to have some life. Commissioner Holman: I will point out again though, office is allowed there now and what we have right now with office allowed is a lot of blank dark windows. Chair Burt: We have within the plan some new constraints on the amount of office that can be built per parcel. I certainly concur with you that I don’t want to see loss of retail and business services. My objective would be to retain whatever amount we are essentially requiring by the limitations on office. If we have a .4 of FAR of commercial and a limit on how much of that can be office based on the 2,500 square foot parcel then we would already have a circumstance where as if a developer were going to take advantage of the full .4 FAR of commercial a certain amount of that would by necessity be retail. Then the amount that is left over that is office, the way we .are currently proposing it, that office has to go upstairs. The concept that I am just struggling with right now is if we allowed that office instead to be on ground floor in addition to the amount of retail on ground floor that we essentially would be allowing them as what is left over in their .4 FAR then we would create a circumstance where in the future we might have that ground floor office flip to retail. But if don’t allow them to flip back in the future I think they wouldn’t take advantage of that incentive. Whereas if we mandate that the office be second floor we don’t have that potential. So that is what I was struggling with wanting to create such an incentive. If I might ask Alison, do you have any thoughts on this because admittedly we are struggling with a new concept in response to something Bonnie tossed out and we maybe haven’t fully explored this. Ms. Alison Kendall, Consultant Planner: I did want to comment a little bit on this. We did find in looking at the second floor office space with that set of regulations that is basically 2,500 square foot maximum on the ground floor and 2,500 square foot potentially on the second floor whatever that leftover amount is on the second floor is pretty hard to actually build in practice in combination with residential because you generally have floor to ceiling heights and general dimensions that are very different. So unless you have a very, very large site the thing becomes a big headache and I am not frankly sure that a second floor office space of 2,500 square feet would be worth it for a developer to try to incorporate. It obviously depends on the office market at the time and I think for sites that are closer to the Downtown it is more valuable but generally we found that it just didn’t seem to make sense. So we were basically putting the 2,500 square feet of office only on the ground floor and making up the difference with a very Page 16 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3O 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 small retail business. For example on a site the approximate size of all these we would have say the 2,500 of office and a 1,500 square foot retail space and that would basically take up the .4 FAR and it would all be on the ground floor because that is the easiest place to put it in terms of handicap access, elevator service, all of that kind of thing and frankly then you also get the flexibility in the future potentially if the retail became more viable. Chair Burt: If the office were allowed to be on ground floor would it have a ramification of diminishing the retail on ground floor based on the other elements of the plan as they are currently proposed? Ms. Kendall: I think it does. You will probably wind up wanting to put both of them on the ground floor. The only exception to that is sort of the Roxy Rapp original proposal where you can do a lot of office and then you do it on the top floor and then you get views. Most of these sites are really not in that category where they are going to be tall enough or have enough office to attract somebody who is going to be looking for that kind of a location. So for most of them I think it is more likely that you would wind up with that space on the ground floor. Chair Burr: Bonnie and then Karen. Commissioner Packer: So if we had a limitation and said no commercial above the ground floor you are saying it really wouldn’t be that much of a hardship for most projects. It would be sending a message but it wouldn’t really have that much of a reality impact. Ms. Kendall: That is my sense of it at least with most of the sites that we actually have out there in SOFA. The exception might be the California Floral Mart site, which is so close to Downtown that it has more viability for office perhaps. Commissioner Holman: I am tempted to say shoot us and put us out of our misery but instead of that I’ll ask another question. There are some properties in SOFA 2 that I think are probably 5,000 square foot lots and have 1,000 to 1,200 square foot buildings on them. I am trying to get my brain around what Pat is proposing but as I understand it, and correct me if I am wrong, but I think under what Pat is proposing those uses that are now a little photographers studio and a little design studio, those for instance could become general office, correct? Chair Burt: No, I am talking about on new construction. Is that what you are referring to also? Commissioner Holman: I didn’t know you were talking about only new construction. Chair Burt: Yes. Mr. Emslie: We are assuming that the original direction of the ground floor retail conversion still applies. So it is only the new construction we are talking about. Chair Burt: Yes, I am sorry I didn’t make that more clear. ~reventing Page 17 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3O 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Commissioner Holman: So if we are talking about new construction that is a bit different. That satisfies my question then. Chair Burr: Well then we drifted off. Phyllis. Commissioner Cassel: I like the direction you are going. I prefer that to putting more office upstairs where we don’t get it converted back and I prefer it because although we have lost a lot of retail to office lately I know we need some balance in this and I know it comes back and forth. I like the direction you are going. If it was my choice I think I would have them bring us back something along your line and see if that doesn’t make more sense. It needs a little more fleshirig out, I can’t quite get my fingers around all of it. Mr. Emslie: So we are heating then there may be consensus to develop a FAR PC provision that would allow up to 1.5 mixed-use with a very restricted amount of ground floor office that would be allowed. And the number that has been used by the Planning Commission as a target would be the 25% or the 2,500 square feet limitation. Ms. Grote: I hate to complicate this further but would you want us to look at a locational requirement that would not allow office on the street facing facades of these ground floor spaces? In otherwords, you would have office tucked behind retail or to the side of a retail or other personal service or other more pedestrian friendly use? Chair Butt: I think if that would work economically and from a design standpoint that might be ideal. Commissioner Packer: Except for Alma. Commissioner Griffin: Lisa, how do you put it behind retail? Are you still going to provide windows for example? Ms. Grote: That is correct. You would have your entrance off the street facing fagade. It is something akin to the Downtown restrictions, which allow 25% of the floor area on the ground floor to be in office use as long as it is not street facing. You can obviously have your entrances off the major street or a side street but you don’t have the street fagade taken up with office use. You have that in either retail or personal service or some other permitted use that is more pedestrian oriented. So it borrows from the Downtown requirements. Commissioner Cassel: In your proposal Pat, are you suggesting the whole space, the whole .4, could be in retail, which would be fine? Chair Burt: Yes. Karen. Commissioner Holman: Well I am going to be a dissenter because you know my feelings about general office in the SOFA 2 Area. I think this is definitely an improvement for where the conversation has been before but I am still not in favor of additional new general office. Page 18 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 ,40 41 42. 43 44 45 46 Chair Burr: Alright, let’s see whether we have a plurality on this. The concept being to allow the amount of office that is currently allowed could be located on the ground floor under the restrictions that Lisa described of street facing retail and with requirements that the design of the ground floor office be done in such a way that it was compatible with a future conversion to retail, which we heard from a number of property owners that this was a design concept that was appropriate and what they advocated. Let’s also see whether we have concurrence on the FAR. We had a 1.15 FAR by right and up to a 1.5 FAR with a PC. How does the Commission feel about those two components? Are we in consensus on the two as a group or do we need to break them up? Commissioner Griffin: Provisionally I am saying we ought to look at it. Chair Burt: So to give Staffthe request to come back with specific wording that reflects that? Commissioner Griffin: Correct. Chair Butt: Okay, I see consensus. Karen, are you dissenting on that? Nope, she is concurring. Commissioner Packer: This whole discussion on office retail I think we were talking about the RT-35 area. Should it not also apply to the RT-50 area? Chair Burr: The descriptions we had on the retail? It seems like there is no reason why it wouldn’t apply to both. Does that seem correct? Does Stafffeel that is reasonable? Okay. Yes. Good. Now that was probably our most problematic issue remaining. It took quite awhile but I think it was one that we were struggling with last meeting and we have kind of moved toward a consensus on it. Yes, Karen. Commissioner Holman: There is one piece that I added to the discussion. That commensurate about retail or neighborhood serving, we call it retail and we are encompassing that, retail would be retained on sites rather than being replaced by housing. That came up during the Working Group discussions too particularly Tom Harrison talked about that a fair amount. He said he really would be saddened if he saw this whole area converted only to housing. So again it is trying to strike that balance. Chair Burt: Commissioners? Bonnie Commissioner Packer: I am reluctant to force that requirement on every project because it just may not make sense on a particular place. I think it is a disincentive for development. It would be very difficult to implement as well. I can just see all kinds of question, where does it go, how do they provide it, what does it get replaced with, I think it would just freeze everything up and nothing would happen if we had that kind of a restriction. Chair Burt: Phyllis. Page 19 ! 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3O 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 Commissioner Cassel: On the other hand if what we are trying to do is keep a retail spine along Homer and Emerson then it might well work there. You can say the others can do as they please but if you had something like you have been talking about proposing and then you were expected to have some kind of retail or this retail/office combination along that spine I think it would do what we have been trying to do and that is keep a focus on some retail area that w.ould then become, because of the size, more neighborhood serving. Commissioner Packer: Can’t we do that with the FAR incentives as opposed to. being very specific about requiring it? You encourage the development of retail in other ways as opposed to saying you can’t replace something. It is just the way we go about it. Commissioner Cassel: Correct but if we allow all residential at a 1.5 you may take down an old building that is kind of dilapidated and replace it with 1.5 and then you lose the retail that is in it. You may not want to have to replace all of the square footage in the space that was there before. That may be impossible fimction-wise but might be able to have then some restrictions along that core area. It would give you some of both. Commissioner Griffin: Karen do you want to restate your comment again, please? Commissioner Holman: It is the converse of what happens in the Citywide ordinance. The Citywide ordinance says that general office can’t replace housing. So that same protection should be afforded in the converse in SOFA 2 in my opinion. Based on a multitude of SOFA 2 meetings that housing should also not be able to replace ground floor retail or services. That again is because it is a mixed-use area and we don’t want to eliminate the whole eclectic nature, which is what we are supposed to be building on. So housing shouldn’t replace ground floor retail or services. Commissioner Packer: I guess the reason I have a problem with that is that there are some lots that have these old automotive services that may turn out to be just not economical and they may be very good sites for 100% residential. Let’s say there is a PC and somebody comes in for 1.5 and we say it is one of the requirements of the PC that it has the spirit of the plan and the plan and the policy say that we want to encourage the retention of retail along the Homer/Emerson corridor then that is a factor in evaluating a PC that comes in on those streets. If something comes in along Addison and High let’s say where those auto places are, I think that is where some of those are, and we had the restriction that you are proposing then a developer wouldn’t want to develop there because they would have to find some way to put retail there even though it is not a really good place for retail just because there was an auto service there which is a kind of a retail service. So that is why I have a little bit of a problem. I think there may be other ways to achieve what you want to achieve. I agree with wanting to maintain those retail frontages along Homer and Emerson but if we make this blanket requirement we may shoot ourselves in the foot or have some unintended consequences. Commissioner Holman: I think we always should be looking out for unintended consequences and I appreciate that. I would have to hunt a little bit to find it but aren’t a lot of the FARs on the automotive sites pretty dam low? So what I am proposing they wouldn’t have to provide that Page 20 1 2 3 4 5 6 7 8 9 10 11 .12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3O 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 much retail space anyway. Again it is not retail-retail we are talking about neighborhood serving as well. Ms. Grote: The FARs on the automotive serving sites vary. Some of them are low but some of them are at 1:1 already. So they do vary throughout the area. Chair Butt: I guess my thought is that this is an issue that I need to think more on and I don’t know that I can do it on the fly tonight. So maybe it is something we want to roll to our discussion on the 5th. Steve is rolling his eyes saying he wants recommendations tonight he doesn’t want open issues. I will toss one other out while we are in this discussion of retail. Phyllis earlier brought up the point that under our current guidelines we would never get a Palo Alto Hardware or a Whole Foods being allowed to locate in SOFA if somebody wanted to come along and put in a nursery or something like that. I am wondering whether we should also allow under the PC in this area a higher retail. It may also be that we don’t want to mandate the other public benefits but we would want to use a PC under a traditional sense that it looks at site specific uses that are different from what we would have in the overall plan area. So I have just been thinking about Phyllis’s comment and do we want to have some latitude in this plan to allow a project that came forward and said we would like to have something that is a little larger retail than .4 FAR. I don’t know that we would want to have a blanket allowance for it and consequently simply including that prerogative under the PC would give some future latitude. Commissioner Cassel: Or maybe under a conditional use. Chair Burr: Okay. Michael. Commissioner Griffin: I am reflecting back a little bit on this latest Sedway report that talks about the proliferation of retail that we are encouraging in the SOFA Area and whether or not it is really viable and secondly that it does have certain parking ramifications. So I am struggling with what is the proper balance here. Chair Butt: First, I would say that the viability would be determined by the developer who proposes it not by Sedway. Frankly, I found that Sedway report of very little value because they based it on a hypothetical absurdity. I was looking forward to something that would be informative and frankly I was very disappointed in it. I just thought it was a distortion of what was the potential reality. So back to your question of what is viable, all I am saying is ira particular project determined that it was viable and wanted to propose it that we wouldn’t prohibit it. Not that we are mandating it or any such thing. Then with the parking I think that would have to be part of the review under the PC or conditional use or whatever mechanism we think is appropriate. Karen. Commissioner Holman: To try to move us along perhaps we could get agreement on a couple of things. One would be that at a minimum along Homer and Emerson that housing would not replace retail or neighborhood serving. That would be one thing that perhaps we could agree on at a minimum that would be the case. Then the other one would be what Phyllis suggested about a larger retail function, for instance one that Pat mentioned a nursery, which I think the area ¯ Page 21 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 46 could certainly use, be allowed under a conditional use permit. So perhaps we could discuss those two and maybe reach some agreement on those. Chair Burr: As far as the concept of whether we would not allow any residential to replace retail I am not yet ready to go that far but one of the things I have been struggling with before is whether under the PC we would say perhaps a residential PC can go up to 1.35 and a residential retail PC could go up to 1.5. So you create that incentive for the retail component. They get additional FAR if they include the retail component. That would be an alternative approach. I am not certain that I am opposed to something along the lines of what you are proposing but I don’t feel like I have enough of a grip on it tonight or at least yet to support that. Any one else? Phyllis. Commissioner Cassel: Well, I know that Steve wants us to keep moving on and get some firm decisions but it may be better to get more firm decisions on other issues and let us chew on this little piece of it and get more of the rest of this done and see if we can’t come up with less that is loose. Chair Butt: Okay. Then we will put this one on the backbumer for the moment. Is the next item historic preservation standards? Is that where we left off?. Bonnie. Commissioner Packer: I don’t know that we have ever covered item seven which is residential density, which is the amount of units per acre. I don’t have any problem with the Staff alternative but should we come to a consensus on that? Chair Burt: Right. I think you are correct that we did not complete discussion. Commissioners, what are your thoughts on residential density? Commissioner Cassel: I like this concept. I am a little uncomfortable with the RT-35 having a 15 as a minimum although it would be nice because some lots may not be able to handle it and be happy with a ten. This is a fairly new concept but I really like the idea. Chair Butt: This is per acre not per lot. Commissioner Cassel: I understand that. Some of these lots are so tiny that it is done by lot. You know what I mean. Chair Butt: So say we had a 5,000 square foot lot which is less than one-eighth of an acre and so a 15 would be only two units. Michael? So are we in concurrence with the proposal as stated here? Okay. Historic preservation. Let’s wade into it. Commissioner Cassel: I actually had questions on this section. Chair Burt: Go ahead Phyllis. Commissioner Cassel: I had questions for Staff. We had standard procedures for designating historic buildings. Are these buildings that have been listed in this report are they all now Page 22 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 46 historic buildings? Are they potential historic buildings? If they are potential historic buildings what procedure are we going to use to move them to designated buildings? Ms. Grote: They are both on the local inventory and some are just potential for national or state register. However, the goals and policies within the SOFA 2 Plan call for protection of those that are eligible for the state and national register just as they call for the protection of those that are on the local inventory. So they would all be protected under the California Environmental Quality Act and under these goals and policies. They would all be subject to the Secretary of the Interior’s Standards should remodeling or additions be proposed. Commissioner Cassel: I was just trying to make sure that they are all currently designated on some list that they are not potentially to be on our list and then we are going to apply these standards even though they haven’t been put on our official list yet. Ms. Grote: Right. They are either on our official local inventory or they have been designated as potentially eligible or eligible through our Dames & Moore study that was done a couple of years back. It was an historic study of basically the entire City. So they have been identified and they are on a list that is identified as an historic resource. Commissioner Cassel: Okay. My concern is that if they have only been identified and they are not designated as historic on our local list that we are then going to have them meet the standards of something that has been designated. They haven’t had an opportunity to appeal that designation. Ms. Grote: They are subject to those standards under the California Environmental Quality Act. So they have to meet those Secretary of the Interior’s Standards anyway. Commissioner Cassel: So they know that and they already know that they are in that category? Ms. Grote: I don’t know that they all know that. I suspect that they do. They have been on these lists for quite some time but I could not verify that each and every property owner knows that. Commissioner Cassel: I guess my concern here is that we have met a standard. Remember, we had a lot of problems with that Dames & Moore list. So my concern is that we check that these people that are on the list that they know they are on the list and they know that they are going to have to comply. Ms. Grote: We can certainly notify people of that. They will be subject to the Secretary of the Interior’s Standards regardless of pretty much what happens in the SOFA 2 study. They are subject to those standards. We have made sure that that’s clear in the plan that is why we included a lot of the goals and the policies that are in the plan. We will also include a statement in the development standards section that reiterates that so it is not just in goals and policies but it is in the development standards as well. Chair Burt: Karen and then Bonnie. Page 23 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 46 Commissioner Holman: God knows I hate to disagree with you just a bit on this but I do. I wish Dennis were here. Someone may want to correct me on this at some point in time but I think this is correct to answer Phyllis’s query. By the way this map that we got tonight is still not quite accurate because the age properties are nation and California register historic survey list and also current inventory properties. Ms. Grote: We are still working on correcting the map and getting it all designated correctly. Commissioner Holman: So unless the properties are in the CD District like the filling station is those properties, all of this is, anything that is on the current inventory has to comply and national register properties have to comply. The California Register properties, and those are all identified as, that is a potentially eligible list that the survey was never refined because the Council cut the line there. It is however consistent with the SOFA 1 Plan that California, national and inventory properties have to comply with the Secretary of the Interior’s Standards. Does that answer your question? Commissioner Cassel: That does. My concern here is that if we are going to make them comply with the Secretary of the Interior’s Standards that they have proper noticing that they are going to have to comply with those. Just because we put the cap on and decide that they are going to have to do this we may run into some of the reaction problems we had before to our historic ordinance of anger. People need to know that in some kind of a process of noticing that they are going to have to comply with these standards if they haven’t so been noticed. I know all the national ones do and I am not sure whether the California ones do, but if they are on our own inventory list I think we have to designate them as historic by the City normally. I just ~vant to make sure that if they need to be noticed that we might want to do it all as a piece. We need to check that out. It is not that I am objecting to the meeting of standards but rather that they get proper notice and it is handled within the City rules. Ms. Grote: Again we can send notice to owners of those known historic resources and the potentially eligible historic resources so they know that they are either on a list already or eligible for the state register. We can certainly do that. Also, I think we have. enough information that anytime an application comes forward we check into the cultural resources aspect of it whether it is historic or some other cultural resource. So at that time if there is evidence pointing to the fact that it may be eligible we would then pursue that and have an historic report done on the site and we evaluate whether or not it could or should be on the national or state register. So we do that kind of analysis with every project. Commissioner Packer: So in other words what we are saying here is not anymore stringent than the applicability of these historic preservation codes, laws or guidelines in other parts of the City? Mr. Emslie: Yes, it will clarify what already is in place. We cannot supercede state law because any property that is eligible for state or federal listing whether it is on our list or not must comply with the Secretary of the Interior’s Standards or have that impact be overridden with the preparation of an environmental impact report. Page 24 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Chair Burr: Michael? Bonnie. Commissioner Holman: Again, I hate to differ just a little bit but the R-2 properties, again I could be wrong, but the R-2 properties because they aren’t CD I believe what we are asking them to do would be different than what they are doing now unless they are national register. I don’t know which ones are California and which ones are national. If some of them are California Register what we would be asking them to do is something a little bit different. Again, i really wish Dennis were here. Ms. Grote: They are still subject to the California Environmental Quality Act which then states that you cannot modify those unless there is evidence that whatever modifications are being proposed are consistent with the Secretary of the Interior’s Standards. I think they are still subject to those standards. We can certainly double check with Dennis but I believe they are still subject to those standards. Commissioner Holman: Just so we can get an answer, is it possible maybe Zariah could check to see if Dennis is upstairs and we could get this answered? Mr. Emslie: I sent him home this evening. So I did shoo him out of the office so hopefully he is not up there. We will double check just in case he snuck back in. Chair Burt: Okay. Michael and then Bonnie. Commissioner Griffin: Indulge me here for a moment. I realize that this map is not up to date but I have been dying to find out about the former Nash showroom that is catty-corner across from Watercourse Way. That entire building is shown with an H on it. I have personal experience I had my car repaired at that little shop next door to the showroom. Surely you don’t intend to include that entire cinderblock building that is abutting the showroom as all historic? Ms. Grote: When a site or a building is designated as historic it does mean the entire building is historic. However, Dennis Backlund, our Historic Resources Planner, and I were talking about this today on a different site. There are aspects of certain buildings that aren’t character defining or sides of buildings that aren’t character defining and there is the potential to modify those in some ways. So it doesn’t mean that those non-character defining sides have to remain in place just because they were original. It means that you have to show through your historic evaluation that you are not going to destroy the integrity of the overall resource by modifying those facades or fronts. So there is some flexibility there but once a designation is placed on a building it does mean the entire building is subject to the designation. So you have to review it carefully when modifications are made. Commissioner Griffin: I was just thinking about the cinderblock add-on that was tacked on after the original. Ms. Grote: Especially if it is an addition. If it is not original to the building then there is much greater flexibility and sometimes the Secretary of the Interior’s Standards even encourages you Page 25 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 to remove those poor additions and replace them with something that is much more sensitive to the original building. Mr. Emslie: The Roth Building is a good example of that where those wings actuallyimprove the historic character by removing inappropriate additions. That is allowed under the Secretary of the Interidr’s Standards. So the designation calls into play the Secretary of the Interior’s Standards but it does allow you to make modifications and improve the historic character of the original building. Commissioner Griffin: Thank you. Chair Burt: Bonnie, did you have something else? Commissioner Packer: Yes. I don’t know if this is an appropriate time to raise this or not and you can tell me ifitisn’t. There is a section in the Special Provisions of the draft plan on page 36 and it says it is Section 5.14 but it is really 5.4. It talks about compatibility with existing historic structures down on the bottom of the page. It talks about buildings near or adjacent to historic residential and non-residential buildings and it has a lot of requirements. I don’t know if this is the time to raise my concerns with that section or not or if the Commission would rather we did that later. Commissioner Cassel: You mean the process questions that relate to this? Commissioner Packer: This is not process. This is in the development standards section and it is very broad. Commissioner Cassel: Page? Commissioner Packer: Page 36. It says any buildings that are near or adjacent to one of these historic buildings have to have certain setbacks or they have to be compatible. It is kind of like a design guideline but it happens to be in the development standards, which is one problem. Ms. Grote: I would recommend that you could either modify that greatly or even delete that at this point because that was put in prior to the Working Group’s discussion and vote to add the compatibility definition into the site development regulations and into the actual requirements of the plan. So I think given that that compatibility definition and requirements is in the plan negates the need for such a specific setback requirement that is talked about in 5.14.d.1. I don’t think that is necessary given the compatibility definition that was added. So you may want to talk about either modifying it or removing it. Commissioner Packer: I would go for removing it since we have the compatibility section. It creates less questions about what do you mean by "near" or "adjacent to" and all those definitional issues. Chair Burt: I think I would agree. Page 26 1 2 3 4 5 6 7 8 .9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Commissioner Cassel: That’s fine. I have a question on the next piece of that. Chair Burr: One that one, Karen? Commissioner Holman: On page 18 the last paragraph there is something that is unneeded here because it is covered in the Secretary of the Interior’s Standards so this is redundant. It says, "SOFA cap requires that properties identified on the City’s Historic Inventory or ’as eligible for the state or nation register of historic structures be preserved." There could be a period there because this, "either onsite or relocated," if you skip that and go to the next sentence and go down to, "all restoration work is to be consistent and in substantial conformance with the Secretary of the Interior’s Standards." Secretary of the Interior’s Standards allows relocation. So that really is unnecessary and maybe even confusing language. Commissioner Packer: Okay. Chair Burt: Okay, we concur on both of those, Bonnie’s and Karen’s recommendations? Okay. Then Phyllis you have something else? Commissioner Cassel: Back to where Bonnie was and keep going down to, "Existing buildings whether or not included in the City’s Historic Inventory provide character and scale to new development and should be reused and remodeled rather than demolished whenever possible." How do you enforce that? It seems yes, it is lovely, but how are you going to take care of it? How are you going to handle it or modify it? Ms. Grote: That is another one where after reviewing it more carefully we have some proposed rewording that we were going to bring to you on September 5 to look at modifying that so that it talks about preserving the building when it adds to the character or retains the character of the area not just whenever possible. To somehow tie it to how it fits in with the existing neighborhood or area. Commissioner Cassel: How do you enforce it? Are you going to tell people they can’t take down their building and it is not an historic building? I know there are buildings we want to keep that are lovely out there. Ms. Grote: You may want to talk about moving it out of site development requirements and into guidelines instead so it becomes an encouragement rather than a requirement. Then we would look at again how it fits in with the surrounding area but not requiting it. Commissioner Holman: Actually, this is me who doesn’t like to see the landfill filling up and all that. Reducing and reusing are the best solutions to reducing waste. So I don’t know if there is a way to leave that under standards and encourage it. I would certainly be interested in that. I have seen some pretty sizable buildings in addition to some small buildings be remodeled without being demolished that were very economically feasible and didn’t produce all the waste that a demolition does. So if there is some way to really encourage that I would certainly be in favor of that. Page 27 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 1 2 Commissioner Cassel: Karen, it is not that I don’t want to see these buildings reused in any way 3 or added to or the character remain, my question is how do we handle it and how do we do that? 4 5 Commissioner Holman: I agree. I am just hoping that there is some way that Staff can come up 6 with that will give us some solution to that. 7 8 Commissioner Cassel: Want to do the process question related to historic nowor later? 9 10 Chair Burt: We can do that. I didn’t know whether Staff had any further response on this issue. 11 You are talking about changing it to guidelines? Ms. Grote: I would look at making them guidelines so then there is a lot of encouragement but it is not required. Chair Burt: What does that mean to encourage? If we don’t have an incentive how do we encourage? So if we did want to move in a direction of trying to encourage this then we need to encourage it with something substantive and I would say something that is an incentive rather than punitive. I don’t have a specific recommendation as to what that would be but if we are sincere about wanting to encourage that then we have to give them something to encourage them to do so. Karen. Commissioner Holman: Before we go to process on page 19 if you look at Policy DC-9 it says, provide information to the public, etc. on preservation tax programs. When you go to Policy DC-10 it says encourage use of state historic building code but there is nothing that says to provide information to people about the state historic building code. So I would like to add that language. Commissioner Cassel: I didn’t turn fast enough. Commissioner Holman: Page 19 basically just provide information regarding the state historic building code to all the interested parties that are mentioned in DC-9. Chair Burt: I don’t see any problem with that. Bonnie. Commissioner Packer: I would like to go back to Karen’s concern about the reuse issue. If the concern is the landfill maybe what we need is some green language in here. The construction techniques and recycling and all that when there is any kind of development is encouraged. Chair Burt: I don’t know why that sort of encouragement or requirement would be specific to SOFA. I think this is an important aspect of the ZOU that we should move progressively toward but I don’t think it is a SOFA specific issue. Commissioner Griffin: I concur. Chair Burt: Phyllis, you had some process questions. Page 28 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Commissioner Cassel: Right, but under DC-10 since we are on that page it is not encourage use of state historic building code when you have to use it you want to use it. Commissioner Holman: You don’t have to use the state historic building code. What happens now is a lot of the public developer/homeowner don’t know about the state historic building code and their architects don’t either. So they go in and do much more than they have to, they add expense to their project, so I want those people to have that information. Chair Burr: Okay. Phyllis, you had some process issues on historic aspects. Commissioner Cassel: Right. We have a proposal. Commissioner Holman: Page, please. Commissioner Cassel: I am sorry. I was working off of Attachment A summary sheets at the bottom. This is page 38 too. We have a proposal from the Working Group for a joint ARB/HRB review panel. I believe they are to be reviewing not on_ly the historic buildings but all of those that were touching that property. So I did a count and we have about 94 buildings and we have 14 that don’t qualify. So my sense is that we are either going to have all of them reviewed or only the historic buildings reviewed because that is going to be meaningless to have 14 that are not. Ms. Grote: Just by way of input, when the ARB reviewed the plan they had recommendations for a slightly different process and that would be that the Architectural Review Board would review all non-historic buildings that the Historic Resources Board would review all historic resources and that there not be a joint ARB/HRB. That is following much more our standard review process for historic and non-historic. Then alternatively when the Historic Resources Board reviewed it they did support the joint HRB/ARB Board and wanted the area of influence to be what determined whether or not a non’historic resource would go to the Joint Board. So it is a slightly different way to determine what as eligible for joint review.. Chair Burt: Does Staffhave any comments on what they think would work best? Ms. Grote: Our recommendation is actually as outlined in the plan, which is consistent with what the Working Group recommended. That is that the Joint Board be used for c~rtainly historic resources and then those that are adjacent to or across the street from historic resources and that the ARB be used only for those non-historic resources. Commissioner Cassel: My problem with that is that leaves only 14 buildings in this district that they are not reviewing and that makes no sense. Ms. Grote: It was based on the fact that even though not every building is historic it is certainly part of an area that is affected and influenced by historic buildings and that it would make sense to have the Joint Board review the vast majority of projects. Page 29 1 2 3 4 5 6 7 8 9 10 11 12 13 ¯ 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 46 Commissioner Cassel: I guess my proposal to the Commission is that we should decide to do one or the other and not leave 14 out. That doesn’t make any sense. We are either going to review them all or we are going to review them and use the ARB process because 80-plus touch each other. Chair Burt: Bonnie. Commissioner Packer: You already explained that you are proposing taking out the paragraph I didn’t like about including all the non-historic buildings that are adjacent or across the street about the setback and all that because you said we have this wonderful page that talks about compatibility, That concept of compatibility with all surrounding buildings would be before the ARB whenever they are reviewing anything. So if you require the non-historic sites that are next to or across the street from historic sites to go to this Joint Board and the HRB, I assume I haven’t worked on it, they are focusing on issues that are specific to historic structures and not necessarily architectural issues of compatibility for non-historic structures. So why is it we can’t trust the Architectural Review Board to look at the compatibility of a non-historic development or remodeling, whatever triggers the ARB review, to determine whether it is compatible with all the buildings around it whether or not they are historic or not? Why do we have to have the non- historic adjacent sites go to the HRB? To me it doesn’t make sense and we create a great deal of burden. Ms. Grote: Actually, the HRB does look at architectural elements and they assess compliance or compatibility with the Secretary of the Interior’s Standards. So they very definitely look at architectural aspects of a project. They will also look at a non-historic site’s changes or remodels or new building and how it might affect the historic resource that is very close to it. So it is primarily issues of compatibility. So there are architectural components to that. They do ¯ look at that’s very carefully and evaluate that. Commissioner Packer: But doesn’t the ARB do that as well? The n0n-historic sites don’t have to comply with the Secretary of the Interior’s Standards because it is not historic. Ms. Grote: But they do need to ensure that they are not having an adverse impact on an historic resource. So they do need to have greater sensitivity to the historic characteristics of that building that is next door than what would otherwise be required of an architectural review. There .are additional standards. Commissioner Packer: Do we require this anywhere else in the City? Ms. Grote: In SOFA 1 is the other place that we require it, other than that, no. It was seen as actually a streamlining measure in order to get both Boards represented at the same time so an applicant doesn’t end up going through two Boards at two different times without the two Boards talking to each other and working out some agreeable solutions. So it was seen as a streamlining measure and a way to get both input at the same time. Chair Burr: Karen. Page 30 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17. 18 19 20 21 22 23 24 25 26 27 28 29 30 31 ¯ 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 46 Commissioner Holman: In a perfect world, and SOFA 1 was the first time this had been used and it was absent some training and procedural issues because it was the first time it was kind of a rocky road but those issues have all been identified too. The benefit of having the combined Board review these projects is for the same reason that we have people with varied backgrounds and interests on this Commission. The HRB and the ARB have a lot of common interests and goals but they also have their different areas of expertise. So when you blend those together and combine that with the streamlining aspect of applicants being able to go to one Board you should end up with a better and quicker resolve. Commissioner Cassel: Why not all of them, Karen? Commissioner Holman: I don’t have a problem with 14 of them or however many of them being left out. I would be okay with all of them going but I also don’t have a problem with some of them being left out if there is not an adjacency issue. So I could go either way. Chair Burr: Phyllis, what problem do you-see with those 14, that are definable, just going to ARB? Commissioner Cassel: It just seemed awkward. There-is just so little of it. It just seemed funny to have a review process for this area that covers almost everything and not everything. It won’t make a big difference it just seemed strange. I guess I prefer the ARB review but I am not going to push it one way or the other. Chair Burt: I am fine I think with leaving it the way Staff and the Working Group have set up. Bonnie. Commissioner Packer: I appreciate the explanation and I am more edified now about the whole thing. In terms of making this understood by anybody who is a developer, is across the street meant directly across the street or at an angle? I don’t know how encompassing this is. iI can understand something that is contiguous, adjacent to it, but across the street seemed awfully broad to me. So I don’t know if there is a sense that maybe we should be more specific and why - across the street? Was that in SOFA 1 also or are we getting too expansive? Is it necessary? Ms. Grote: Actually I think everything in SOFA 1 was required to go through the Joint Board there wasn’t any distinction. I don’t know that we as Staff or the Working Group got specific about what across the street means. I think it meant directly across the street. That is the most I can say about it. Commissioner Packer: Maybe we should add that word so thatit is clearer. Chair Burt: Alright. In attempting to close on the last couple of items do we have anything else on the historic? If not, we actually have covered item 12 and that leaves us nine, ten and 11, nine being the FAR Bonuses for Seismic and Historic Upgrades. I guess one of the issues really is when we set FAR limits are they intended to be maximums or are we saying that onsite additional FAR bonuses would be allowed beyond the maximums that were set. Lisa, you look like you had something. Page 31 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 46 Ms. Grote: I thought you were asking me a q~aestion. I think the concept behind the bonus is that yes, it would be over and above whatever other maximums were set. Commissioner Cassel: This is the same as we have in the rest of the town for this? Ms. Grote: The amounts are slightly different but the concept is the same. That it would be bonus square footage for historic rehabilitation or a seismic upgrade and that could be either used onsite or transferred offsite to an eligible receiver. So the concept is the same. Commissioner Cassel: What is the difference in the amount that is allowed? Ms. Grote: I’ll have to look. Downtown it is a straight 2,500 square feet or 25% of the site area whichever is greater. Here the historic bonus is slightly less than that. I will have to look that up. Chair Burt: In this plan it is only for a residential bonus, correct? Ms. Grote: That is the other distinction is that the extra square footage or the bonus square footage is for residential use only. Whereas in the Downtown it can be used for any permitted use. Chair Burt: Is that only on the seismic that the residential constraint is applied? I was just trying to find it under the historic and I didn’t. This page 34-k in the plan says, "All increase square footage can only be used to provide residential units and can only be used onsite." Is that what you had said earlier, Lisa? Ms. Grote: Although I think some of that language needs to be changed based on subsequent conversations and decisions because I think it was intended that both of those bonuses be able to be transferred offsite within either the SOFA 2 Area or eligible receiver sites Downtown. If they are transferred within the SOFA 2 Area it would be for residential use only. If it is transferred to Downtown then the restrictions on the Downtown apply and it opens up the uses that could be put in that extra square footage. Commissioner Holman: IfI could add two things. Another change to this than what is allowed Downtown is that for the seismic if the building is removed then there is no seismic bonus allowed. The other thing is as Bonnie pointed out I think bonuses can only be used for housing and even though this would be potentially above the maximum FAR it still has to satisfy the compatibility findings. Chair Burt: If there is going to be a major reconstruction of a property aren’t they mandated to do seismic upgrades at that time? So why do we have to give them a bonus? Ms. Grote: Exactly. So they will do it. It was seen as an incentive that if someone knew that they could potentially get extra square footage to do their seismic upgrade that they would then take advantage of that and actually do it. Page 32 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3o 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Commissioner Cassel: In other words, maybe they would just let the building sit there and not rehabilitate it, just use it for something and not put the seismic into it. We had that happen with what is now Border’s. He could have not done the renovation just done something else. Chair Burt: Right, but if somebody was going to enlarge a property, take an existing building and enlarge it, then what we are saying is that they would be required to do the seismic upgrade for enlarging it but in exchange for doing what they would be required to do we would give them a bonus. So we have two different situations. One we would like to incentivize them to take an ekisting building and perform the seismic upgrades but on the other hand what we are proposing is they will get a bonus for doing what they would be required to do. Commissioner Griffin: It wouldn’t pencil out. In other words, this bonus incentivizes them to do the enlargement otherwise they would say they can’t enlarge this building because by the time you put all those big steel x-beams in here it doesn’t pencil out. It doesn’t make any sense to enlarge the building. Commissioner Holman: There is another piece too, and Staff correct me if I am wrong here, demolition is considered 50%. So if they are removing 50% of the existing building it.is a demolition and they won’t get the seismic bonuses. Please correct me if I am wrong. Ms. Grote: That is correct. Currently in the Downtown area you can get a seismic bonus for when you are removing a building and we have purposely changed that here so you cannot. So if you are removing the building, which is 50% or more of the exterior walls, you cannot get that seismic bonus. Chair Burt: What I am struggling with is when we were pushing for allow for an FAR in RT-35 Zone of up to 1.5 with a PC and that is more than the Working Group had proposed but what the Planning Commission thinks would be appropriate with a predominantly residential project. With these two bonuses if we potentially have a 2.0 FAR, although I am not sure from a practical standpoint whether somebody could really renovate an existing building and convert the whole thing to a 2.0, maybe they could, but I am not sure that I am comfortable with imposing the potential of a 2.0 FAR in what we are calling these transitional areas to the neighborhoods. So that is why I am struggling with this issue. Mr. Emslie: I guess the question is do you feel that you have provided enough of an incentive in the difference between the base FAR and the capped FAR to encourage the type of seismic upgrades or do.you need to go more than that? I think that is the fundamental question. In the discussion that we have heard thus far is that that was the purpose for having that increment. That was to provide the incentive to provide the list of public improvements and I believe even seismic upgrades were included in that list if I am not mistaken but I thought that was one of the public benefits. I could be wrong. You could consider it as a part of the public benefit package. Commissioner Griffin: The public benefit being that in the course of an earthquake your building doesn’t topple over somebody else’s. Page 33 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 Commissioner Packer: If somebody is renovating a building why would they come with a PC? Chair Burr: They might want to have a PC. Hypothetically, and I don’t know if this practically would be the case, but basically if somebody wanted to maximize the amount of FAR that they could build on a site in the RT-35 that if they built around an existing structure, expanded upon an existing structure and got a seismic bonus and an historic bonus then they could put a 2.0 FAR on that site, Is that correct? Mr. Emslie: That is how we interpreted the language, yes that is correct. Chair Burt: There is a lot of discussion in the Working Group about the Working Group’s apprehension about PCs was how big can a PC go? I think that if the Planning Commission is advocating higher FAR limits than the Working Group was advocating I think we owe them some certainty on what those limits are. I think that our concept was correct that a 1.5 maximum in the RT-35 Zone is the most we should go in this area that transitions out to the neighborhood. Now, we could either do what Steve was suggesting is say that we have provided the incentive via raising the FAR in the PC and we don’t need to provide additional incentive. Alternatively, it could be something that is transferred offsite. Commissioner Cassel: What about what was suggested here was that it be included as one of the possible public benefits in that PC Zone? Chair Butt: Bonnie. Commissioner Packer: In this summary, the matrix, it says 25% of existing FAR, however, the plan doesn’t say that. The plan under Seismic Bonus says they are eligible for increased square footage. That is straight square footage not a ratio of either 2,500 square feet or 25% of the existing building’s square footage. In other words, whatever they are tfiey can increase by another 25% but then we can say, however, you cannot go beyond the FAR for that area. That is different from what was put in the matrix and I think that is where we are getting confused. So the original plan said you can get bigger by 25% of square feet but that isn’t necessarily and however, you cannot get beyond the 1.5 or 1.15 whatever is the FAR. Mr. Emslie: I think the reason for that is there was no cap at least in the Working Group. So the cap is kind of a new concept. So I think we are catching up with ourselves in a sense. So you could very well consider it that way and keep the cap as you have discussed and provide that incentive. Chair Burt: Does the Commission feel comfortable with that? Allowing this verbiage but that it cannot exceed the caps that we have suggested. It seems like we have consensus. Karen. Commissioner Holman: Are you talking about seismi~ or historic or both? Chair Burt: I think we were talking about both. Page 34 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 1 Commissioner Holman: I guess I would be okay with that with seismic. With historic I would 2 be more in favor of keeping it the way it is because sometimes the historic buildings don’t satisfy 3 the zoning anyway and have different configurations and such. And they still have to satisfy not 4 only the compatibility but the Secretary of the Interior’s Standards so I am not concerned about 5 extra FAR on those buildings. It is not a new Construction so I think it is better and going to encourage more renovation of existing building if that stays as an FAR bonus. Again, it can only be used for residential. Chair Burt: One of the things that I had not picked up on is it is 25% of the existing building size, not the new building size. So the maximum increase is less than I .was envisioning. Commissioner Cassel: And not the FAR. Chair Burt: Correct. That is what I meant. The new building size being the FAR limit potentially. Okay, so Karen is proposing that we allow this bonus under the historic and not allow it under the seismic. Commissioner Griffin: Karen, repeat again why you weren’t concerned about that. Why you thought that it would be all fight for the historic bonus to exceed the FAR limit? Commissioner Holman: Some of the historic buildings don’t fit into the current zoning pattern anyway because they were developed before there was zoning there. Also because they have to Satisfy the Secretary of the Interior’s Standards I am not concerned about them being an offence to the street or to the neighborhood. Chair Burt: What about the option of allowing that bonus up to the 1.5 FAR and anything that they would be entitled above that would have to be achieved offsite so we wouldn’t have any building in that area that would exceed 1.5? Commissioner Holman: I think that doesn’t give enough flexibility to the historic owner. My recommendation would be that it stays onsite or could be transferred off. Commissioner Cassel: We haven’t had a lot of this nor have we had a lot of situations where anyone has pushed the max. Mr. Emslie: As I understand the concern is that many of the historic buildings are over the FAR cap so in those cases they are already really at the max because they would be non-conforming. They would be allowed to retain the square footage that they had and then you have the other controls related to the compatibility standards and the Secretary of the Interior’s Standards to make sure that what happened did conform. So that is really less of a concern. If they are already over the FAR cap they are going to be retained in their current fashion and there is no need for a bonus at all because they would have already been enjoying the higher FAR through the non-conforming status. Commissioner Griffin: Are you saying that the historic building is already exceeding the cap? Page 35 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Mr. Emslie: Yes, I am sure there are examples where you have historic buildings that are over the FAR. Commissioner Griffin: And now we are going to give them the ability to become even more over the cap than they are already? Commissioner Holman: Just as we do any place else Downtown. Again, you have the constraint of the Secretary of the Interior’s Standards and the compatibility guidelines as well. So because of those constraints I am not concerned about like I said, an affront tothe street. Because the buildings are already non-compliant in some instances with existing zoning they are not going to standout any more than they already do, in my opinion. Mr. Emslie: In other words what I hear Commissioner Holman saying is that it is worth the risk. You have built-in controls either they are already existing so they already have a place in the environment that exceeds the standard so it is not going to be a big shock and if you do allow some bonus to that in addition that will be very highly regulated through the compatibility standards and the Secretary of the Interior’s Standards. Chair Burt: Is the Commission okay with that proposai? Okay. Item ten I think we actually had already dealt with. That was the TDRs and Staff was going to come back with some proposals on that. Mr. Emslie: We are not coming back with a proposal. What we are doing is we are putting in the plan a recommendation that would be followed up with a more specific TDR program that would be developed after the plan was adopted that would identify generali).ed areas for specific benefits as well as to work out the mechanics of the transfer development rights. But it wouldn’t be done in conjunction with this plan. It would be done as a follow up item. Chair Burt: Okay. Karen. Commissioner Holman: Can I get one clarification on a TDR? Currently I think if you have some benefit or bonus you have to develop the transferred bonus concurrent with the project that is being developed. You have to do them at the same time, don’t you? Do you have to do them concurrently? And could we change that? Is there a reason that that has to be held true? Ms. Grote: I think what we said you have to do concurrently is if you are getting an historic bonus you have to do the historic upgrade concurrently or have plans in for building permit to do that upgrade. Or if you are doing the seismic or if you are trying to obtain a seismic bonus you have to be doing the seismic work to the building right now. In other words, you can’t say I want to do my seismic upgrade two years from now, take the bonus and apply it either onsite or offsite. So you have to be doing whatever work it is you are requesting the bonus for at the time you request the bonus. Commissioner Holman: So if we take that a step further, say there is a general area or perceived are or however specific we are able to get legally, I keep focusing on this just for a point of conversation, for parkettes or public open space. If someone wants to develop that as a parkette Page 36 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 46 they could do that and they could sell their TDR sometime in the future. They don’t have to do that aspect of it at the same time, correct? As long as it is owner initiated. Ms. Grote: Right. They can get what we call a certificate. If they are going to transfer the bonus square footage offthe site we give you a certified letter that says you have;’x’ amount of square feet to sell at some future date. Yes, you can do that now in the Downtown. So if you are not using your bonus square footage right now you can sell it at a future date. Chair Burt: Sell it or use it? Ms. Grote: Sell it or use it, that’s true. They do not have an expiration date. Chair Burt: Alright, are we done with the TDR issue? That gives us the last aspect, which is alleys. Commissioner Packer: They are fine. Chair Burt: So the concept was that existing alleys between High and Alma and between High and Emerson shall be preserved to support commercial use. Any comments on it? Everyone seem comfortable with that? Okay. Then I think that finishes our work here for tonight. Commissioner Cassel: I still had a couple of others. I know it is late. Ms. Grote: I did also want to just introduce a conversation that we had with a property owner of property in SOFA 1. We can either do that now or after you are finished. The property owner at 828 Bryant Street, which is in SOFA 1, has a small office building on it now. During the SOFA 1 process the Council did ask that during SOFA 2 the FARs and the uses allowed on that site be at least considered. What they have now are a couple of small dental offices and I think it is a psychiatrist or psychologist office, but professional medical office. They would like to be able to apply whatever is approved as part of SOFA 2 as far as densities are concerned on their site. in SOFA 1 it was considered an attached multiple family site. They would like some ability to retain the office use and then add residential use in addition to that, on top of it basically in a second or third story. They wanted that to be at least considered because there are similarities between the lot sizes on that parcel, it is about a 50 by 112 or 115 foot deep site, to be able to apply SOFA 2 densities for a mixed-use project on that site. Chair Burr: You are not asking us to act on this tonight, correct? Ms. Grote: That’s correct, but to be aware of it and if you have comments on it to certainly make those but not to take an action on it tonight. Commissioner Cassel: This is on Ramona? Ms. Grote: It is 828 Bryant. Commissioner Cassel: Bryant, so it is not connected. Page 37 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3o 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Ms. Grote: It is not connected to SOFA 2. It is one block up from SOFA 2 but they are suggesting and wanting some consideration of SOFA 2 densities because the lot size and configuration is similar. Chair Burt: That’s the narrow dental offices across from what was formerly the rear end of the Roth Building, right? Mr. Emslie: Yes. The significance is that this came up in SOFA 1 and it came up kind of late in the process and there was direction at the Council level to say well, this looks and acts more like a SOFA 2 parcel, go deal with it in SOFA 2. So we are here nearing the end. So there is some expectation that this is going to be dealt with per Council direction. Chair Burt: That parcel as I recall was somewhat of an anomaly in that area. It was independently owned, not owned by PAMF and this kind of came along at the very end of SOFA 1. Rather than hold up SOFA 1 they said let’s roll it over inthe SOFA 2 process as kind of an odd adjunct to the SOFA 2 process. Karen. Commissioner Holman: I am a tittle sensitive to making sure that anybody within the appropriate radius is notified that this is going to be discussed because when 820 Ramona was at the last moment added to the SOFA 1 there was upset by the neighbors because they didn’t know it was happening. So please make sure that the appropriate radius gets notified of that. We are not going to make any decisions on it tonight but I just want to mention that in the Working Group for SOFA 1 we zoned all of that area not including this parcel but all of that we had wanted residential. It got changed after us to office. Lastly, I guess I’ll put a pitch in for this, Lisa has heard this from me before. There are some parcels zoned DHS in SOFA 1 that still exist out there and as that zoning has been so very, very problematic if we are going to pick up something else from SOFA 1 I would make yet another pitch to please be able to add that back to this discussion that will come back to us as well. The DHS zoning is very problematic and there are some potential real problems that still exist out there. I would rather not wait for the Zoning Ordinance Update because I could go into why but it is probably not necessary right now. Commissioner Cassel: I guess I don’t understand why it fits with this. Commissioner Holman: If we are going’back and picking up a parcel from SOFA 1 it would seem consistent that we could go back and pick up some other parcels in SOFA 1 that are problematic. Chair Burt: I think the question is if there are remaining cleanup issues from SOFA 1 should that be included is the question and I don’t know the answer. Bonnie. Commissioner Packer: Some of us were not as closely involved in SOFA 1. I would just request that we get something that looks like a Staff Report that gives us something that would put this particular property in context, an explanation of what is going on around it just like as if it were some kind of application asking for certain things so we could see how this would look if it were Page 38 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 an RT-35 as we are developing it SOiZA 2 and how it would apply. Something that would put all the facts in front of us and helpus make a decision on that one. Chair Burt: Phyllis, you .had some other items. Commissioner Cassel: As I went through the document, on page 20 it said encourage art in this area. I think I have the same problem here that I had with the other encouragements. This is private, it is not allowed as part of our PC Zone as a public benefit. I think it is neat but I am not sure that it can be ordered or it is going to have to be pretty general. Who reviews it? Who says it is public art? I guess I am feeling funny with it being there. Chair Burt: So the question is how would be encourage it if that is what we want to do? Commissioner Cassel: Right. That is nice wording for it. I don’t know if you need to respond to that. Chair Burr: Again, pat them on the back. Well, I think that fits within some of the other goals within the streetscape of SOFA 2, which is how do we achieve them. Commissioner Cassel: I had several like that so I think that is exactly where I am going with that, how do we achieve some of these goals? Obviously if you want to try to put this area together and have some consistency and you are going ~o encourage street furniture Should it be somewhat consistent street furniture or should it going to be varied? Is it going to be part of the streetscape.? Are we going to have special lighting in this area that accents this area that gives it kind of that character? Does that come from the streetscape? Chair Burt: I would just like to concur that some of these aspects about the streetscape are going to be very important if we are going to ultimately achieve some of the objectives of the retail vitality and the walkability and those things. I would like to see us attempt to put more meat to those things as well because if we don’t do those kinds of things then we may have a plan on paper and we aren’t really providing the complimentary aspects that will really bring it to fruition. Mr. Emslie: I think we are kind of getting into another area of planning. Essentially what you are talking about is what is commonly referred to as urban design plan that would set out how you would develop and what uniform elements would you start to incorporate. That is really another whole body of work. I think what you can do is suggest in here that as an implementation tool the City develop an urban design plan that has consistent street furniture and street width and tree planting and landscaping. That is another whole area that this doesn’t really get into. I think the closest we have got to it is starting to encourage it and then if you wanted to go further I would rather recommend that we set out to do an urban design plan for this area to start to create some cohesive elements. Commissioner Cassel: I guess that is my question. We keep writing encourage in a lot of these things that we all know are part of this urban design but there is nothing here that says how that is going to happen. Page 39 1 2 .Mr. Emslie: That would be a follow on item. So maybe rather than have a lot of the encourages 3 you acknowledge the fact that you need to, at some point, do an urban design plan that has the 4 cohesive elements and you start to call out the things that make it read as a common 5 neighborhood. So maybe that would be one way to go and we could take a look at that. Maybe 6 replacing a lot of those encourages with actually a follow up implementation plan that does 7 incorporate those kind of common elements. 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Commissioner Cassel: I think this is text that is going to have to come out, it says multiple family housing is a permitted use in one place and it is a conditional use in another. I think we have been talking about that in a different context but I suspect in the text that sort of got overlooked. Ms. Grote: I am sorry, I didn’t hear which use you were talking about. Commissioner Cassel: It is housing use and in some places it says it is a conditional use and in some places it says it is a permitted use. Is multiple family housing a permitted use or a conditional use? Somewhere in here it said it was going to be a condi.tional use. Ms. Grote: Multiple family housing should always be a permitted use. So if there is a place where it says conditional we will correct that. Commissioner Cassel: Something on page 29. Chair Burt: Anything else? Bonnie and then Karen. Commissioner Packer: I think it is in the design guidelines on page 24 where it talks about street parking should be provided. In certain places where were we want to encourage, especially in the retail area, the short term parking, more 30 minute parking. Maybe it is already there. I think we talked about that in some places. We may want to mention that, That is all in the public area. Again, this goes back and forth as to how do we incentivize things. In the design opportunities it keeps on saying should, should, should, so it makes it sound like it is a development standard as opposed to a design opportunity. So I am a little confused. It is all that tension between flexibility and requirements. At 11:00 pm I don’t want to go through each one and figure out what those are but as you are refining going thrdugh the text here if you could figure out what should really be a development standard and what should be design. Phyllis pointed out last time I think there must be at least 20 times that street trees are mentioned with different distances. We found 20, 25 and 30 feet to center. It is all very inconsistent. There is a lot of repletion in the design guidelines and development standards where concepts are repeated and repeated again and repeated again. It might have just been an editing issue when we first saw this. So we trust that that will be all cleaned up. Chair Burt: Karen. Commissioner Holman: Some cleanup things too. Page 28 under Land Use Designation it says, and of course this would have to change but just to point it out, "there is one land use designation Page 40 1 in the SOFA 2 Area." That of course would have to Change. On page 16 and then again on page 2 26 public plazas and plazas are mentioned. Public plazas and plazas.on page 16 are mentioned 3 twice and on page 26, D at the top, plazas are mentioned. We talked at the Working Group about 4 eliminating the references to plaza because this is a transition area and plazas are considered a 5 very urban design element. That is what the Working Group had determined. 6 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 Ms. Grote: Right and to substitute the words, "open space." Commissioner Holman: Yes. Under Height, again on page 26, staggered step-backs and again it is going along with what Phyllis was getting to, "massing or portions of a building are recommended to encourage diversity in design." I think that should be required otherwise we are just kind of waiving it in the air. Commissioner Cassel: In some of my cases I am not sure that we should require them. I am just not sure we can encourage them. Chair Burt: When it is a recommendation, is that essentially a guideline for ARB? Is that how that is intended to be implemented? Ms. Grote: It is. It is a recommendation or a suggestion that then the ARB can use to evaluate a particular proposal. A statement like this might actually even be better put in a policy rather than a guideline. It is a design related policy, which is another place to address it. Commissioner Holman: Then the Massing and Building Articulation, this might follow something we did earlier. Page 26. How much of that language do we need here because we have the compatibility requirements? Some of it might be helpful to retain but I think that should be looked Chair Butt: Okay, does that do it? Great. Good job. Karen, one more? Commissioner Holman: There was. There were a few definitions that were needed. The one that I noted that I can find right now is there isn’t a definition for porch. There isn’t a definition for cultural resource. I think there are a few others. I could maybe just email those if I discover those and maybe other people have the same issues. Chair Burt: Yes, that sounds good. Any other things that Commissioners notice that are minor to bring to StafFs attention you can just provide them outside the meeting. Then I think that adjourns this item. I would like to thank everyone fo~ hanging in here, Staff, Commission and audience. We are continuing this item until September 5, 2002. Page 41 1 2 3 4 5 6 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Planning and Transportation Commission Verbatim Minutes September 5, 2002 EXCERPT Other Items: South of Forest Coordinated Area Plan - Phase 2: Final Recommendations to City Council. Ms. Lisa Grote, Chief Planning Official: Thank you very much Vice-Chair Griffin and Commissioners. We are here tonight to talk about your final recommendations that would be .forwarded on to the City Council regarding the SOFA 2 area. I did want to pint out that the plan that you received in your packet and you will be considering tonight is the Planning and Transportation Commission recommendation only. It was not an attempt to include the Working Group or any other variations of those recommendations that you had seen to date. This was to summarize the recommendation or at least preliminary recommendations that you have made so that you could review those and determine whether or not they accurately reflect your conversations and your decisions. I know there was some concern expressed about this Staff Report and that it did not include a detailed analysis of all the various economic studies that had been done and the conclusions that had been drawn from those studies. Since you were a participant in those conversations I did not attempt to summarize those conversations again for you. Those are reflected in your minutes. The summary statements will be forwarded on to the City Council in their Staff.Report. So since they have not been participants in that discussion I will summarize the BAE report, the Sedway report that came in in response to that BAE report and then again BAE’s response to that report. All of those reports will be attached to the Staff Report that goes to the City Council so they will have full benefit of all that information and the various conclusions that were drawn from it. I did want to point that out, that that information will not be lost along the way. Also, we should at the end of tonight’s meeting take about five or ten minutes and talk about how you would like to present your recommendations to the City Council. It is currently scheduled to go on October 7. I am anticipating that I will be preparing the Staff Report and giving a Staff presentation which would summarize the Working Group recommendations as well as the Planning and Transportation Commission’s recommendations. I am assuming that Working Group members or a member and a Planning and Transportation Commissioner or Commissioners would like to be part of that presentation or would like to make some statements. So we should talk about how you would like to do that at the end of the meeting. I also want to point out that some of the less controversial decisions or topics that you have discussed were included in the draft plan that you saw. A couple of those include additional transportation policies. One is in regard to encouraging and supporting additional timed on- street parking in the area. That was a policy that is added that is not part of your summary chart Page 1 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 t but that was added to the document. In addition there was a policy added to support and retain 2 the use of the alleys for commercial purposes in the area. That was another topic that you had 3 discussed and wanted included. In addition what had been called "Special Provisions" and 4 became "Performance Standards" there had been a special provision that talked about a 15-foot 5 step back for buildings that were adjacent to historic sites. I took that out based on your 6 direction at the last meeting because it was covered by the compatibility standard that is now 7 required as part of the design requirements. So in response to including that compatibility 8 standard that other 15-foot step back was not needed so I removed it. In addition there was a five 9 foot landscape buffer around perimeters street sides and I removed that based on your 10 conversation and direction to move the buildings and close to the street and as close to the sidewalk as possible. So I removed that and I did want to note that for you because it is not in your summary chart. I think probably the best way to cover the rest of the comments is to go over the summary chart. There are ten primary topics that you went through and made recommendations on and we can take those one at a time and then look at where they are reflected in the document and if it is reflected accurately. Also, I know Commissioner Packer had submitted several comments and we can address those as you would like to throughout the discussion because they span a number of different areas within the document. Also you will note that in the attachments to the Staff Report transmitting this document to you were several maps and charts. Attachment A is a summary of the various requirements within the district and within the RT-35 and RT-50 Zones. It does include updated historic resources. I did coordinate with our Historic Resources Specialist and he confirms that these are the most updated resources. It also reflects the buildings that are eligible for seismic bonuses in the area. They have an’S’ on them and I think there are four of them. So this is an attempt to reflect the zoning requirements for those two areas. In addition there was a prospective provided by Friedman, Tung & Bottomley and Alison Kendall is here. So when we get to the height and daylight plane requirements especially along Alma, Homer and High as seen from the perspective of the comer of Alma and Homer she is here to help explain those and what the final recommendation is in terms of height and then setback and Slope for that and these graphics. So with that I would conclude the StaffReport and say that we are ready to go through on a point-by-point basis the summary chart. I would recommend using the SOFA 2 Discussion Topics Chart, which does summarize each of those topic areas. Commissioner Griffin: Thank you. Would any Commissioners like to make any opening remarks before we plunge into this topic item by item? .Karen. Commissioner Holman: I have a question for Staffregarding the S identified properties that you say are eligible for seismic bonuses. Previously this question had come up several times and we were informed that there were no properties in SOFA 2 that were eligible for seismic bonuses. Can you tell me when this was updated or how this has occurred? This has come up a number of times previously. Ms. Grote: IfI had said that I apologize. Commissioner Holman: You did not. Page 2 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Ms. Grote: Okay. I was uncertain as to how many there might be and when I did coordinate with our Chief Building Official, Fred Herman, he gave me the official list. That is what I took these from. So it is a limited number but there are four of them. Commissioner Holman: I just want to make sure we are on the same page because it has come up several times before. Ms. Grote: I think this is an old list. I think it was created in the late 1970s or early 1980s. Commissioner Griffin: Any other Commissioners wish to ask a question of Staff?. Phyllis. Commissioner Cassel: All of us are having trouble tonight. It was just an observation. As we get down through the formal list I think I have some questions to review the text in body. You asked us to, in our recommendations, to forward the comments that we made on our summary list. I had some other questions that I wanted to reconfirm with the rest of the Commissioners or ask in general. Commissioner Griffin: So we can handle those as we go along. Bonnie, how about you? Commissioner Packer: I guess my question is the relationship of the first part of the plan, which has all the policies and programs and all the text and discussion and then the technical part of the plan that has the development standards, etc. I wanted to be sure that as we are going through this as Commissioners that we make sure that they mesh, that there is some discussion in policies that reflects the technical aspects that are in Sections Four and Five. Commissioner Griffin: Bonnie, could you pull that over a little better? Commissioner Packer: Was I not on? In other words I wanted to make sure that what is presented is an integrated document because that is the way I see it. So that when we go back and forth that we are not just looking at a particular number or whatever but that the policies that we try to implement are expressed in text in the first part of the plan. Is that what will be going before Council? I was looking at this document as a final plan. Ms. Grote: Right, it is a final plan. I think that what you have been doing in your review to date is just that, looking at the policies, in fact we went page by page through the document and looked at those policies and then what those development standards and design standards and opportunities are intended to do is implement those policies and goals. I think that is what you have been doing throughout your review over the last several weeks. So I believe that part of the review has been done but if there is an inconsistency that you see please tell us and we will work through that. I am hoping that there aren’t those kinds of inconsistencies because I think we have really reviewed it very carefully in that regard. Also I do want to add, I’m sorry to tag on to what I said earlier, the seismic list has been updated periodically over the years. There were several buildings that as they are brought to the Chief Building Official’s attention if they have un-reinforced masonry or if there is other material in Page 3 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 46 there that is in need of seismic upgrade he has added buildings to that list over time. I didn’t mean to imply that it has been a static list for the last 30 years it has been updated. Ms. Wgnne Furth, Senior Assistant City Attorney: That list, as you know, only includes certain kinds of seismically hazardous buildings. It is a smaller set of buildings than those that might be expected to fall down in some kinds of earthquakes. Commissioner Griffin: There being no other comments we will get underway with a discussion of the first topic, which is height. I am wondering, Lisa, did you say that you would like to make some comments on this particular item? Ms. Grote: Yes, thank you. I did want to just summarize that the height limit in the RT-35, which is Residential Transition 35, is a 35-foot height limit and then in RT-50 it is a 50-foot height limit. I can put the overhead on the projector that is shown in the map in Attachment A. The mustard colored area is RT-50 that is where the 50-foot height limit would apply. Then the orange color is the RT-35 and that is where 35 feet would apply. Wynne was just pointing out it is a standard height definition and measurement, which means it is measured to the midpoint of a sloped roof or to the top of a flat roof. Commissioner Griffin: Looking at the text on the map under RT-35 it says, "residential transition up to 35 feet in height at 1.15 base FAR, 1.5 max FAR with one public benefit or TDR". Then I am presuming that is on a PC, that last item. Ms. Grote: That is correct. As you look under RT-50 it does say with a PC and we will add that wording to the RT-35 so it is consistent. It is a 1.5 maximum FAR with a PC application and one public benefit. Commissioner Griffin: Thank you. Alright, would Commissioners, Phyllis. Commissioner Cassel: You were reading this, 1.5 max FAR with one public benefit or TDR, do you mean and? Ms. Grote: Actually or TDR because I think the Commission decided that should someone transfer developable square footage onto a site that that was also a way. This would be seismic or history bonuses square footage onto a site that that also could be a way to increase the FAR up to the 1.5 maximum. Commissioner Cassel: I think there may be a communication problem. You may need to reword that Slightly because it looks like it is public benefit or TDR versus it could be done by TDR or a PC. Ms. Grote: Okay. Yes. Also you will notice a little area of orange along Homer, it is in the RT- 50 District but is about a 25-foot section or sliver of orange color. What that means is that for the first approximately 25 feet into this site the building needs to be 35 feet instead of 50 feet. that was iri order to maintain the Homer street frontage. This is something that I would like Alison Kendall from FTB to talk about a little bit more because there are a couple of ways. We Page 4 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 1 had talked about trying to maintain that Homer street frontage in a consistent manner. One way 2 is to have this 25-foot step back on a building. You would go up 35 feet have a 25-foot step back 3 and then go up to 50 feet. Another way to do it however is to go up 35 feet have a 15-foot 4 approximately step back with an angled roof at about 60% and that would also accomplish the 5 same thing. It is less of a step back, it is less sever, but it allows you to tuck the fourth story into that roof structure. This what the perspective tries to show is that from Alma and Homer you would then not see that fourth story or see very little of it from a pedestrian perspective. Alison has some additional graphics and discussion for you to consider. Commissioner Griffin: Are you saying then that 25 feet would not be necessary, you could do it with a 15-foot step back? Ms. Grote: It would be the equivalent of a 15-foot, yes. Instead of stepping back with a flat roof it would be an angled roof starting at about 15 feet back from the edge of the building so it wouldn’t be as severe a setback or step back on that fourth floor. Commissioner Griffin: So would that alternative then be reflected in the map? Ms. Grote: Yes and we should talk about that based on your final. You had asked for a couple of alternatives and a final recommendation. We would actually be recommending that you use the 15-foot with a sloped roof because that allows you a little bit more interest architecturally . than just a straight 25-foot offset basically. Commissioner Griffin: Alison. Ms. Alison Kendall, Consultant Planner: TharLk you Commissioners. I just wanted to point out some of these illustrations which help you understand this concept which we developed specifically for the Homer corridor and looking at the objective of basically producing an effect of essentially a three story building along Homer but allowing the potential to allow up to a fourth floor particularly located along the Alma portion of the site. What we really found, this perspective I think shows it particularly well, is that from the vantage point of a pedestrian on the far side of the street once you achieve something like a 60% slope on the roof or on the daylight plane and if you basically require the height along the property line to be no more than 35 feet you completely hide any fourth floor square footage and you will get the effect of a three story building. "In fact one of the things that is nice about this 60% slope is that it’s a pretty plausible roof slope so you can actually execute that architecturally in a lot of different ways that look normal and that produce some other benefits in terms of detailS on the fagade and so on. Here you can see one example where we actually have a roof that corresponds exactly to that profile. That could be continued all the way up to the fourth floor, there could be a roof terrace that is sort of cut into that zone. So it could actually be quite a useable zone in terms of outdoor space for a fourth floor unit. The net result would definitely be that you would basically not be perceiving that from a pedestrian viewpoint even if you are on the far side of the street and looking over at the property. So that was really the criteria we were looking for in terms of your recommendation. Also various alternatives that we looked at we recommend the 60% slope on a daylight plan( rather than some of the other alternatives that we talked about such as a step back Page 5 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 ~27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 which sort of forces you into a sort of awkward wedding cake kind of a building form potentially with not so many architectural options. Just to show you the variant on that a smaller and steeper daylight plan as we talked about on High Street shows just a little bit of that fourth floor from the far side of the street. This is based on the width of High Street. Whereas the 60% slope really completely hides it. So our recommendation and our vote would be to go with a 60% slope which sort of corresponds with something that you would normally find in a California roof form rather than a kind of Swiss chalet or a Parisian mansion or something that would be a bit steeper. So I would be happy to answer any questions that you have about that but we do think that achieve the objectives and produces a building design that we think could be executed on a lot of different styles but basically be very attractive and help to contribute to the appropriate scale of both Homer and Alma streets. This is an example of the potential fagade along Alma. You can see the three story portion along Homer and the way that that could step up potentially to four stories along Alma. Are there any questions? Commissioner Griffin: Karen. Commissioner Holman: What does this do to the viewiine down Homer? I am thinking if you in the 200 block of Homer or looking back at the 200 block of Homer or in the 200 block of. Homer and looking back towards the 100 block of Homer you are aware of the building heights lot deep. So what does this do to the view line as you looking up and down Homer? Ms. Kendall: It is true that if you were in front of Whole Foods and looking down in this direction you would see both the three-story portion and potentially depending on what happens in the intervening blocks you might see a portion of the fourth floor. It would basically look like the elevation you were just looking at. But we were really focusing on more the experience of the pedestrian which obviously if you were walking close to the building the experience of the building is really the immediate plane next to you. If you are walking on the far side of the building it is really once again the portion that you see in front of you and that small portion that you can see behind you. So it is true you would see a limited portion of the fourth floor if you could get to the right viewpoint and see it through the trees and so on. That would be predominantly in that block between High and Homer. Commissioner Griffin: Comments? Bonnie. Commissioner Packer: I like the Staff’s recommendation and because we have a lot to do tonight ! move that we have a little vote. We should probably do this all through the evening is have little motions and move along from one thing to another so that we can then go on to the next area. So I move that we accept the Staff recommendation on the 60% slope along Homer in the RT-50 area. Is that correct for the daylight plane? That’s my motion. Ms. Grote: Just for a point of clarification, this 60% slope and daylight plane issue only applies to those two parcels along Homer in the RT-50 Zone. Commissioner Griffin: Pat. Page 6 1 2 3 4 5 6 7 8 9 lO 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Commissioner Burt: I think that maybe Bonnie’s recommendation on how to proceed has merit but maybe we should just make sure that one, we are in agreement on that approach tonight and second do these need to go through motions and seconds or can we just raise them for consensus of the Commission. Ms. Furth: However the Chair wants to do it or if the Commission disagrees with the Chair you can overrule him but it is free for Michael just to ask for consensus on a point. The real issue here is just clarity in your direction to Staffand at the end you can just make a motion confirming all your earlier directions. Commissioner Burt: That is even more expeditious yet. What do you think Michael? Commissioner Griffin: I’ll ask for consensus. I just want to make sure that before we proceed that everybody said everything that they need to on this height item. Karen. Commissioner Holman: Are we looking at only the two parcels there? Okay. I did look at this but I am not in support of it because of the view line down Homer and given what the buildings are that are there. I am not in support of it. Commissioner Griffin: If there are no other comments do I have a consensus on the remaining f+ur of us? Good. We will move then to the second item, which is the floor area ratio. I would like to ask Lisa to make a few of her comments here. Commissioner Holman: Before you go to that the other height issue, I want to make sure this is in the record because I was not in agreement with the other Planning Commissioners on where the 35-foot height and 50-foot height should be. I am in agreement with the Working Group’s proposal for where the 50-foot height is allowed with the exception of the PF facility where the public utility is now. That one I would also include as a 50-foot height. Commissioner Griffin: Alright the record will show that difference of opinion. Bonnie. Commissioner Packer: I maybe jumping around but it is a height related issue. It is on page 53, where there are some special regulations for PC districts. It was 5-B. I think some language was picked up from the Zoning Code about parcels that are near residential areas and that the height has to be 35 feet. You might want to look at that and see whether that provision really makes sense in the context of the SOFA plan. If you have a PC and in the PC it says it can’t be more than 35 feet or 50 feet and none of the RT Zone is next to - it is weird because it says for all other uses the maximum height has to be - anyway we could get into this thing if it is next to another residential use. You might want to look at that and see if it is really necessary in the context of these RT Zones. Ms. Furth: I think that is something that we need direction on. This is from the genetic PC Ordinance and the question is what do you think is appropriate for these nine blocks. Set height Page 7 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 standards and as I recall they are not allowed to exceed the height standards for the PC, right? That is one of the things that is invariant. So if you believe the height standards you set are adequate then you don’t need this. Commissionei Griffin: Bonnie. Commissioner Packer: Well, that is why I don’t think we need this because it could create confusion especially in the RT-50 Zone. In the event the RTo35 area has an RM unit on it then the RT-50 has to be 35 feet. I will just raise it to the other Commissioners. This is in the context of a PC anyway. Ms. Grote: So what you would then essentially be saying is if in the RT-35 area or in any area if a PC application is made they could not as part of that PC apply for any kind o£additional height. They would be held to the 35 feet and they could vary the FAR but they could not vary the height. So that is acceptable if that is the direction you would like to go. Commissioner Cassel: Let me see ifI understand where we are. I am a little confused. Are you saying that we don’t need to have this piece? Ms. Grote: It says here that the maximum height within 150 feet or applicable PC districts shall be 35 feet provided, however, that for a use where the gross floor area excluding any area used exclusively for parking is a t least sixty percent residential, the maximum height within 150 feet of these RM districts shall be 50 feet. So what this would imply is that if the building was 60% or more residential that it could in fact go to 50 feet and in fact you don’t want it to you want it to remain at 35 feet. So I would agree that you probably want to take this out. Commissioner Cassel: I am.thoroughly confused by this paragraph. I don’t know if we have to get into it now but it makes no sense. Ms. Furth: These are standard PC we have spent a lot of time thinking about this. I think it is clear to us all that we have to keep debugging the ordinance that inconsistencies are going to keep popping up. Commissioner Cassel: Let me ask a question. If we have established a 35-foot limit why would we want to have in these areas another set of ordinances that says? Ms. Grote: You wouldn’t which is why I think this is an oversight. We should have taken it out. It has been pointed out so we will take it out. Commissioner Holman: I want to thank Bonnie for bringing this up. I had a question there too. Do we need to keep the first two and one-half lines of that sentence? Where it starts, "provided" then drop off the rest of it. Commissioner Packer: No because we have an RT-50 Zone. If we kept that in there then it would defeat the purpose of the RT-50 Zone in some instances. Page 8 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Commissioner Holman: You are right, I see, yes. Commissioner Griffin: Pat. Ms. Furth: You have already established a set of height standards that are tailored to these particular blocks, particular fi:ontages. You have dealt with their proximity to certain.kinds of residential development. That is how you picked what color should go where among other things and you are also encouraging mixed-use throughout this area, which means that everybodyis going to be next to residential. So we seem to have thrown in some stuff we shouldn’t have. Commissioner Burt: Just a couple paragraphs earlier on the same page under B-3 there is talk about the daylight plane of the original district should not be exceeded. We didn’t really have a discussion, to my recollection, of daylight planes in this area. Ms. Furth: Incidentally that reference to original district is to the RT-35 and the RT-50. Commissioner Burr: Okay, not the underlying or historic district? Ms. Furth: No. Commissioner Burt: Okay, maybe that should be clarified so folks like me aren’t confused. Ms. Furth: I suppose it is different in the R-2 but we can think about that later. Commissioner Burt: So all we are saying here is that what was established for daylight planes in the specific SOFA2 areas supercede this. What are those daylight plane requirements, if you might summarize them? Ms. Grote: We had talked about the roof slope, part of what we just went over for those two parcels on Homer, and that was considered the daylight plane. We had talked about allowing some encroachments into the daylight plane. We did not recommend a specific number, a specific linear footage that could encroach into the daylight plane. What we would be proposing is that if encroachments into that daylight plane are out from that slope our proposal is that they be subject to ARB/HRB review and they would determine whether or not the distance, the length, the amount of encroachment is appropriate given the building design. So that would be the Staff recommendation. Ms. Furth: Incidentally, it seems to me that all of Section B-5 needs to come out. I assume that is your direction. Commissioner Griffin: Are we ready to proceed? Lisa, if we could have your comments on the floor area ratio, topic number two, please. Ms. Grote: Basically maximum FAR in the RT-35 District would be 1.15:1 and in the RT-50 it would 1.5:1. Of that total FAR .4:1 in both the RT-35 and RT-50 districts could be in non- Page 9 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3o 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 residential use. Of that non-residential use square footage .25 up to a maximum of 2,500 square feet could be in office use. The remainder of that non-residential square footage or that .4 could be in other permitted commercial uses and that would include retail, personal service and the other listed permitted commercial uses as shown in the table but there are a variety of them. So it is not exclusively retail it is a variety of commercial uses. Then the remainder of the either 1.15 or 1.5 FAR depending on what district you are in must be in residential use. In addition, the office would be limited to either .25 up to 2,500 square feet and they could be in the Planning Commission’s recommendation on the ground floor as long as they are not street facing and as long as they are designed to be converted easily to retail or other permitted commercial uses. So that is a summary of your recommendation. Commissioner Griffin: Questions? Commissioner Cassel: As I looked at this having a week behind us, I was wondering when we did this 2,500 square foot maximum we don’t have any relationship to that. So a large lot has the same limitations as a small lot. What does that do to us? What kind of problems does that create? If you own a big lot with a lot of frontage then you have one space and if you own a little one or several little lots then you get sever 2,500 square foot spaces. Ms. Furth: There are no minimum lot sizes as I recall in this plan. So people can split their big lots into little lots to get more office. Commissioner Cassel: That might create problems with other things. Commissioner Griffin: Karen. Commissioner Holman: To address Phyllis’s point I really appreciated what you brought up last time or the time before last about a CUP. You brought up an example of something that I think the area could use. So if there was a CUP allowed for a larger than 14 for a non-office use, say for instance a plant nursery, I think there ought to be accommodation for that. As long as it is a unique use and not just a CUP for 15 hair and nail salons to come but if it is a unique service that provides a benefit. Wynne is shaking her head like we can’t do that. Ms. Furth: You are going to need to give me a different category of what it is you want to have a conditional use permit for. We can arrive at some of what you are talking about as you tell us more about it but basically we can’t be in the business of guaranteeing no competition. We can say we are not going to give you a CUP we already have one of those. Commissioner Cassel: So my suggestion was in retail, a CUP would be needed if it was larger than the maximum space. Ms. Furth: So you would permit a larger retail use than .4 on a site under certain circumstances. So us about what it is that would make you want to issue that and then we can turn those into standards. One of the things you are telling me if you are talking about a nursery you are talking about a low intensity use. That is one of the characteristics of nurseries is that they take up a lot of space in terms of both customer and staff. Page lO 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Commissioner Cassel: I was thinking about basic neighborhood services retail services that won’t fit in 2,500 square feet. Ms. Furth: It is not 2,500 square feet. Commissioner Cassel: I was asking a different question than Karen was, the other one had to do with retail. Commissioner Griffin: Karen, would you want to reiterate your point here and address Wynne’s comment? Commissioner Holman: I don’t know exactly how to address Wynne’s legal issue because we can’t have a non-competition category here. Ms. Furth: Maybe I came in too soon. The first thing you were saying is that you want more flexibility than this proposal allows. You want more flexibility for different uses that are presently prohibited or larger uses or what is it that you_ think would be better with more flexibility? Commissioner Holman: Ideally it would be unique uses and you are saying that we can’t do that. What I would definitely not want to attract is regional uses. I wouldn’t want that to be what we are allowing larger FAR for. Ms. Furth: It is not uses that aren’t presently allowed it is bigger versions of those uses, is that right? Commissioner Holman: Correct. Some of those uses that are allowed currently though I think could be regional draw uses. So I don’t know how to dance this line here. Commissioner Cassel: Well, there is no way to ban people from coming from a distance for a store especially the more unique it is the broader the base. Ms. Furth: Regional draws are, a really good needlepoint shop is a regional draw. Commissioner Holman: This is a citywide issue. I don’t think it would be appropriate for the SOFA, as much as I love Restoration Hardware it wouldn’t be appropriate to have a Restoration Hardware, not to pick on anybody here, at the comer of say Addison and High Street. It would create an awful lot of traffic so how do we avoid that but still leave some flexibility for beneficial services? Commissioner Griffin: Pat, do you want to comment? Commissioner Burt: Yes, I would say that we may have preferences but I am not sure that we can zone to avoid things that would stipulate all of our preferences. If we say we value our local serving hardware but we don’t think Restoration Hardware would be appropriate there I would Page 11 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 agree with you that that would not be appropriate butI don’t think it is also appropriate for us to try to create zoning that would differentiate between those two. I guess it is not so much appropriate as it is not feasible. Ms. Furth: One of the things we did discover when we were going through all the retail preservation work and also the previous efforts on Middlefield for those two neighborhood serving areas is that 2,500 square foot limit was adopted because in previous struggles with these issues the Council and Planning Commission decided that size was the best proxy. That was the best way for addressing this issue. Lisa and Steve may have more ideas, there are some kinds of uses that are pretty low intensity but that take up a lot of space. Probably auto repair is one and nurseries is another. I don’t know if they have some suggestions. Commissioner Griffin: Pat? Commissioner Burt: I would just like to remind us that if I understand it correctly under the propo.sal that we have right now under no circumstances would it allow a retail use above 2,500 square feet. Ms. Grote: You wouldn’t allow an office above 2,500 square feet. Commissioner Burt: Office, that’s correct, but not a retail about .4 FAR. Is that correct? Ms. Grote: That is correct. We do need to discuss the nonconforming uses. If one nonconforming use and this is jumpiiag ahead a bit but if a nonconforming, over .4 office or other kind of commercial use were to convert to a conforming retail use, we propose that that would be allowed. You could do that conversion if it is a nonconforming existing situation. You couldn’t build a new situation like that but you could convert a nonconforming overage of FAR from a commercial or office use to a retail or other permitted use. Commissioner Burt: So the example I was going to use of our two major retail establishments in this area of Whole Foods and Palo Alto Hardware could come in in the future, something comparable to that, if they were to convert an existing nonconforming use or in some other form of commercial use. In fact both of those two buildings were formerly commercial uses. But we couldn’t have construction of such a property here even under a conditional use permit. My sense is that we want to create for future Commissions and Councils some flexibility that will allow for those kinds of uses to come in here if they were deemed appropriate through a Conditional use permit. That is my sense. I would like to hear the feelings of other Commissioners and Staff on that. Commissioner Griffin: Bonnie. Commissioner Packer: I would like to come back to why we were concerned about office and retail. Going back and looking at the policies there was a concern that we keep neighborhood serving retail in the Emerson/Homer intersection around there. These sections, four and five don’t address those particular streets anymore. I wonder whether we want to talk about this limit on size just with respect to Homer and Emerson and be more flexible on the size of not retail Page 12 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3O 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 because retail is a .4 FAR in any event, but a little bit more flexible in the other uses, the office uses elsewhere in the SOFA area. That is one thing I would like to point out. The other thing is that these restrictions in 5.040, that is where this is all laid out in the use categories on page 40, that applies for RT-35 and RT-50, however, if an applicant comes in under PC and wants to do something different. This could force an applicant into a PC arena in order to get the larger office or the larger retail because the PC the way we have it setup right now talks about the maximum floor area and doesn’t talk about the mix exactly to the decimal point. Ms. Grote: I believe this Commission had recommended and I believe the Working Group did recommend as well that while the Working Group is not in favor of PCs but should a PC be allowed that it be allowed for residential use. So the extra square footage that someone would be requesting is for residential use not for a different mix of or more commercial or office use. Ms. Furth: The driving factor, there was the’ issue of neighborhood serving retail and those size limitations that come from other parts of the zone but the driving factor on the FAR ratios as I recall is the jobs/housing issue. Commissioner Packer: I agree with that but we should_then perhaps look at the PC language and make sure it states that because I don’t think it is that clear. Ms. Furth: You are right we should strengthen that. Commissioner Burt: Bonnie, can I ask a clarification on something you just said a second ago? You said that we wanted to have greater flexibility on the office. Did you mean office or did you mean other commercial than office? Commissioner Packer: I don’t know I am raising that up. If we want the flexibility on office maybe just to keep the .4 FAR but the 2,500 square feet or keep the .25 but not put a cap of the 2,500 square feet. It is .25 or 2,500 whichever is smaller. So the only time you could meet the .25 is if you have a 10,000 square foot lot or less. That gets you 2,500 square feet. So if you have anything more than a 10,000 square foot lot you can’t take advantage of the size of that lot for a slightly larger office.. Somebody may say well I have an office and it is 3,000 square feet how can I get it, what flexibility is there for me if you have a 30,000 square foot lot it would be .1 FAR for 3,000 square feet yet that would not be allowed. So that is what I am talking about, that kind of flexibility outside of the Homer/Emerson area where people wanted to make sure we had the neighborhood serving retail. Commissioner Burt: I would not support that. Commissioner Griffin: Phyllis. Commissioner Cassel: I would not support that. I think this has been very carefully worked out to try to keep down the commercial. We went through this before to small businesses for the most part. I was simply concerned about some retail and I was concerned to have some clarification on the 2,500 square foot maximum. I don’t think it is in this spot, I think it is as you go down farther it says it is per lot. I was somewhat concerned. Was there any per acre, per lot Page13 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4O 41 42 43 ~44 45 46 per acre? Something or other in that spacing as an added clarification rather than trying to redo the whole sense of what was going on. Commissioner Griffin: Would anyone.else like to comment? Karen. Commissioner Holman: I wouldn’t support that either. Not only that, I will just simplify this by withdrawing my comments about the CUP. Pat convinced me there are other opportunities perhaps for that so I will drop that. Commissioner Griffin: I am going to say that the sense of the Commission then Bonnie is probably not in support of that aspect. Commissioner Burt: There were several things that were discussed here. Certainly the sense of the Commission is not in support of a degree of latitude for a CUP for office..What we had started off discussing before Bonnie moved into that arena was whether we wanted to provide greater latitude for a CUP for a larger retail establishment just Under a CUP circumstance. I think that we still need to discuss. Steve, I think wanted to comment. Mr. Steve Emslie, Planning Director: I just wanted to ~cho Wynne’s earlier comments about the genesis of the smaller square footage as kind of a benchmark as a way to regulate. When you think of this conditional use you have to think that it is a use that you are basically accepting but it has physical characteristics that require an extra degree of restriction on it. It is very difficult to say yes or no when you have two uses and you may like one and dislike the Other but they have the very same physical characteristics. What.you don’t like is the fact that it may be owned by someone at a corporate level or not locally owned. Those are very difficult to regulate. In the world of land use regulation the objective is to find physical characteristics. In this case we think that restricting it to the smaller size is a way to reinforce more locally, more neighborhood oriented businesses versus the larger national tenants that tend to want to occupy more space. We.think that is a good dividing line in a very objective way that is very defensible to keep the businesses more locally and neighborhood serving. Commissioner Griffin: Karen. Commissioner Holman: Just one last little question about that. So traffic generation or trip generation isn’t a good way to be able to draw a line either? Mr. Emslie: Yes, it is a very good way and you can make a distinction on that basis but there could be the very popular local businesses that draw a lot of traffic and that could be perceived as a good thing as you are drawing from your local neighborhood. That is a physical thing but if you do get two that are very similar it is very difficult to say yes to one and no to another. I just want to add that as an area of caution. Commissioner Burt: Steve, can you then review a little bit about the discretionary latitude that exists under CUP and to what extent a CUP would not enable the City to select certain preferable compatible uses that may exceed the .4 FAR for a retail establishment? Page 14 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Mr. Emslie: The most defensible decision that you would make to turn down a conditional permitted use is one that you could not devise conditions to properly offset the negative impacts associated with that. Say you allowed a smoking plant you couldn’t come up with enough conditions to reduce the air quality impacts. You could turn that down because you are not able to reduce that impact. That is an extreme example but you cannot legislate the negative effects of that use adequately enough with written conditions. Then you would turn it down. Commissioner Burt: So let me frame this question in a slightly different way. Why wouldn’t a CUP work for the circumstance we were discussing? Mr. Emslie: It would except that you would be very hard pressed to discriminate between similar uses. I would say it would be very difficult, and Wynne definitely jump in here, to prefer a Palo Alto Hardware over a Restoration Hardware assuming they have very similar characteristics, they have similar trip generation. There is a consistency of use that make it very, very difficult legally to pick one over the other. Commissioner Burt: But under the proposal we have we wouldn’t allow a Palo Alto Hardware. Ms. Furth: Not the construction of a new one. This plan as you have it written is geared to direct new construction to residential space. Ms. Grote: It also encourages the reuse of existing buildings. If an existing building which is exceeding that allowed FAR wants to convert to the retail use it can. So it encourages adaptive reuse of existing buildings. Ms. Furth: I think that it is very difficult to use a conditional use permit to permit a larger version of something as opposed to one use compared to another. I am sure there are circumstances in which it could be done but I certainly agree with Steve that the kinds of distinctions that you have been talking about aren’t the kinds of distinctions that we think you can make legally. Commissioner Cassel: Okay, I will withdraw my suggestion at this time. I think we should watch it and see how it goes. Ms. Furth: It is interesting to look at the permitted and conditionally permitted uses. One of the conditionally permitted uses there is a transportation terminal, a bus station I guess. If there are uses that you think should be allowed that we have left out we can expand that list. If there are particular kinds of service uses or retail service uses that you think need to be treated differently in terms of the amount of space they take up, I don’t know if we should have a different standard here. Commissioner Cassel: I think we should watch this because I am really concerned that we may want in fact some spaces that are larger than this. I don’t know what they are but we are going to have to see a little bit what happens and see whether some things do convert. If the goal is to keep spaces that are there in order to not convert over and build new spaces. Page15 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 46 MS. Furth: So the way it is written if you want a bigger one you are going to use an existing building. If you are going to build a new building it is going to be housing. Commissioner Cassel: I think it is something we want to be aware of. Mr. Emslie: One thing to keep in mind, if you are building a new space you are going to have to park it and it is going to be very difficult to achieve even the .4 FAR and still adequately park it. So in a lot of respects it is a self-enforcing provision especially for retail because it is all driven by parking. It is not even so much the City required parking, as you know, retailers often have higher parking standards than cities will require. So in all likelihood that is going to be the real driving force in terms of the size. Commissioner Griffin: Bonnie. Commissioner Packer: Since we are on the subject of these uses I have two questions. The uses in category three cannot have a street frontage so I am wondering if there would be an exception for their entryway. On page 40, Section 5.040, the text below. I wonder if they can’t have a street frontage can they have a doorway that goes behind. Ms. Grote: Yes, they can. They can have an entry point from the street, yes. Commissioner Packer: So we may want to say except for the entry. Then there is a requirement that even if they are thereon the ground floor and they are in the back they have to be able to be converted to retail and I wonder if that is really doable. So that seemed like a little bit of a conflict. Ms. Grote: It is doable it would most likely mean that an existing street facing retail or personal service use is going to expand into that office use that is tucked in the back. Commissioner Packer: Then the other question. I agree with the emphasis of the plan is to focus on residential. We say that the uses in category three, the medical, professional and general business uses, cannot be on the ground floor except in certain circumstances. So we are pushing them up on floors that may otherwise be used for residential. I don’t know if this is a problem. We are keeping them small it is true but we had a discussion about maybe we should not have any nonresidential above the ground floor. I don’t know, maybe that is not a good idea. That was something we had discussed the last time. I think in our last meeting we had discussed the possibility of prohibiting commercial uses either retail or office above the ground floor and yet in this uses conditions, the medical and professional office uses are not allowed to be on the ground floor except in certain circumstances. So we are pushing new office uses above in space that could otherwise be used by residential. Again, these are no more than 2,500 square feet so maybe it isn’t a big issue but I wanted to throw that out. Ms. Grote: Actually the Commission’s discussion evolved to allow those uses on the ground floor again if they are non-street facing and easily convertible to retail and other permitted uses. So that actually evolved from a position of not allowing them on the ground floor at all which would in essence have elevated them to the second or third floors to allowing them on the ground Page 16 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 floor. So I think the Commission’s position has built in some of that flexibility that you are desiring. Commissioner Burt: Lisa, I think maybe can you walk us to where in the plan that change is reflected? I do see on page 40. Ms. Grote: It is on page 40, section C, in addition to the above restrictions uses in category three shall not have a street frontage when located on the ground floor. All such uses shall be designed to e convertible to retail use. Then D is medical, professional and general business offices shall not be located on the ground floor except for such uses, which have been in continuous existence since the date. This is modeled after our retail ordinance, retail and other protected uses in the commercial districts. Then number five, D-5, except if they do not have a street frontage and are designed to be convertible to retail use. So it does allow them on non- street facing ground floor locations when convertible to retail. Commissioner Griffin: Wynne. Ms. Furth: I do have a concern about the way this is articulated right now. I apologize for not being involved in the conversation for a while, We are all familiar with sites where there are suites in the back that never make sense as retail particularly in older buildings or larger lot or a lot of different situations. I think you looked at a lot of that when you were looking at the Middlefield projects where some portions of some buildings don’t appear to be suitable for retail uses. But one of the things that could be a problem in trying to apply this is how big should the modesty panel of retail or residential in front of the office use have to be if we simply say that they don’t have a street frontage? Ms. Grote: We don’t have a depthrequirement for the design retail space. I think what we had determined at least so far is that the 2,500 square feet was going to be small enough that it was not going to be the majority of the use however it was designed. It was going to be subordinate to the other non-office commercial uses. We did not design in a minimum depth for retail. Commissioner Griffin: Pat. Commissioner Burt: What do we have in the University Avenue area for depth of retail? Ms. Grote: Again, we don’t have a minimum depth for the retail use on University or in any of the GF areas Downtown. Commissioner Burt: That seems to work pretty well the way it is. Ms. Grote: It does. I think it would be very difficult to start designing in minimum depths. Ms. Furth: It is probably incentive to have a viable something or other at the front. That generally takes care of it for us. Page17 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24. 25 26 27 28 29 3O 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Mr. Emslie: There is a certain geometry for retail spaces that is industry standards so that it is fairly apparent that minimum depth of a retail space would be adequate. I think Staff could tell when it is a rouse between someone trying to bootleg an office and a viable retail space. Ms. Furth: My only proposal wouldn’t be to put in numerical standards but to pass some language in here so that the Staff could say no, that is not a real retail space. Commissioner Butt: So do you have recommended language to achieve that? Ms. Furth: If that is an acceptable principle we will put in some language. Commissioner Griffin: Karen. Commissioner Holman: I have a different take on this as you might recall. My approach is not to allow any new general office anywhere in SOFA 2 most especially south of Homer and none at all on the ground floor north of Homer. My real preference would be no new office anywhere in the SOFA 2 area as we have a glut of office and given the jobs/housing imbalance. Allow the existing offices to remain and flip back and forth but no new offices period. That takes care of all of this problem with this discussion. Commissioner Griffin: I am going to see if we have a consensus here developing because we. want to keep this moving. I think the item that I would like clarification from Lisa is whether or not your intent is to add some verbiage as suggested by Wynne to clarify this last point. Ms. Grote: We can certainly do that if that’s the Commission’s direction, yes. Commissioner Griffin: Does that appeal to at four, five, all right, so we have four of us in favor of that point of view. Karen. Commissioner Holman: Also for number five going back to the FARs and number five in the grid chart that we have. I was recalling that the Commission had also agreed with Working Group to allow no new ground floor office along Homer and Emerson. Could I get clarification on that from the other Commissioners? That was my recollection in reading back. The Working Group recommendation says no new ground floor office along Homer and Emerson. What is here for the Planning Commission recommendation is ground floor office permitted everywhere. That doesn’t differentiate between existing and new. Ms. Grote: That was my recollection of your discussion at the last meeting. Commissioner Griffin: That is the way I remember it as well. Commissioner Holman: Could I pose this to the Commission then to prohibit any new ground floor office along Homer and Emerson? Commissioner Griffin: Comments? Page 18 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Commissioner Packer: I think there are so many restrictions on ground floor office, the size, they have to be in the back, that I think it is covered. I think there is enough protection. Commissioner Burt: Excuse me, under the Working Group plan there could be ground floor residential behind a street facing ground floor retail. The concept if I am recalling fight, the concept of the Planning Commission was that by requiring that any new office that would be permitted even under the Working Group plan would actually allow it to be on the ground floor we would then be enabling a future conversion to retail if the economic viability lent itself to that. It says the ground floor office permitted everywhere but may not be street facing and must be convertible to retail. The members of the Working Group had talked about the desirability of having these properties be convertible and so in my mind the Planning Commission recommendation creates the potential for future greater retail viability than does the Working Group recommendation. I think that is why we m6ved the direction we were not because we favor the office. If we were going to permit office then we wanted to permit it in a way that would allow and encourage future conversion to retail of that ground floor office. Commissioner Griffin: Karen. Commissioner Holman: I am truly baffled by this conversation or the direction of this conversation because we talk about jobs/housing imbalance and yet we are allowing new office. The conditions that exist in SOFA 2 now are due to exactly what we are talking about now is allowing new office to come in and yet be able to be converted to retail l~iter. What we talked about previously was allowing existing offices to flip back and forth but not allow new offices. I know I was a proponent of both of those. I am much more restrictive when comes to general office. You want the services there and the retail there to suppgrt the neighborhood but I am really baffled as to why if we were trying to get housing why we were talking about allowing more new office. That is my perspective. Commissioner Burt: Wasn’t, even under the Working Group plan, new office permitted in the Homer and Emerson corridor but not at ground floor? Ms. Grote: That is correct. There would be no new ground floor office along Homer or Emerson and then no new ground floor general business office south of Homer. So there was some allowance for new ground floor office south of Homer if it were medical and professional only not general business office. Commissioner Burt: So as the Planning Commission recommendation reads does it allow general business office in those areas? Ms. Grote: You would allow grdund floor office everywhere whether it is general business, medical or professional, limited to 2,500 square feet and non-street facing and .convertible to other uses. Commissioner Packer: I thought it said that medical, professional and business offices shall not be located on the ground floor. Page 19 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 46 Ms. Grote: Except. Commissioner Packer: So new medical, professional and general business offices would not come into the ground floor. Ms. Grote: Except if you look under D-5 it says, except for such uses which do not have street frontage and are designed to be convertible to retail use. That is what was discussed. Commissioner Burt: So another way to say it might be that those forms of new office are allowable provided that they are convertible to retail. Ms. Grote: Correct. Commissioner Cassel: Let me try arguing this from a different way. We are talking about new ground floor here and the goal in what Pat was trying to say and what I agreed with last time was if you are going to allow .4 total you want to keep it down on the ground floor where it is more apt to convert to retail than allowing it upstairs where once it is upstairs it cannot convert to retail. So the goal here. was to prefer having whatever you had in terms of office on the ground floor so that it had some opportunity to convert. Commissioner Holman: I absolutely agree with that. My argument is though that we don’t need any more new general office. That is my argument. It doesn’t bring anything to this area. We have plenty of general office there that exists. We are looking for housing and more services. So that is my argument. I appreciate what you are saying about ground floor office, put them on the ground floor so that if they were to convert and you allowed it they could become retail. I am saying that we don’t need the general office period. Commissioner Cassel: I would say that a medical use is a service. Commissioner Burt: There is a valid distinction here that I don’t think we are zeroing in on. What I think is at the heart of what Karen is raising as an issue is one that I think we should consider and that is to differentiate between general business uses and the other permitted uses in category three which includes medical, professional and then it says general business uses. So the question is within the constraints that we have a consensus of preferring that if we have new office in these areas that it be on the ground floor provided that it be designed in a way that is convertible to retail should that allowable new office in the retail corridor onl~ include general business office? I think that is the sub-question that should yet address. Commissioner Griffin: Does that state your concern? Commissioner Holman: What are you considering the retail corridor? Commissioner Burt: South of Homer on Emerson. Lisa, can you help me on that? Ms. Grote: The retail corridor is Homer and Emerson as defined in the plan. Page 20 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Commissioner Butt: So I think we have a good concept that whatever office is allowed probably should be driven to the ground floor rather than above provided that it is designed in a way that allows for future conversion to retail. That can encourage retail. Now what sort of offices we should allow in the retail corridor I think is a separate question and one that we should yet try to arrive at agreement on. Commissioner Griffin: Bonnie. Commissioner Packer: A couple of things. I think that we should all look at the definition of what a general business office is andrealize that it includes personnel office, little insurance office, travel agencies, that are neighborhood serving types of offices. That is included. We are not talking about the huge law firms because you couldn’t do that in 2,500 square feet. so we are only talking about 2,500 square foot offices. A nine-block area is not where we have to have equality between the jobs and the housing. That is absolutely ludicrous. Nobody is showing me and I raised this last week any evidence that small offices are going to bring tons and tons of jobs in these small parcels that are throughout the SOFA area. You are not going to have very many new 2,500 square foot general offices. What might come are neighborhood serving types of general business offices. I think we need to be flexible because sometimes this kind of office might be what pays the piper for the residential development above. We can’t create super detailed draconian regulations to address a current economic climate. We have to look at the crystal ball and try to see is this a little bit flexible. I think what you are talking about Pat, what we have right now, what is here right now that says if you have the office it has to go in the back if it is going to be on the ground floor, is good. We may want to say none of these offices above ground floor. We maY want to do that as another way to limit but not say absolutely no new office because that is just a little bit too harsh for me. Commissioner Burt: That wasn’t the question I was posing and you said a number of different things there, Bonnie, and some I may agree with and others I don’t. First I was trying to get us to focus on a differentiation between certain types of business services that are conducive to the vitality of this as a neighborhood serving center as opposed to general business office, and we may need to re-look at the definitions of constitutes general business office, but you said that something under 2,500 square feet is not going to be a significant jobs generation. I don’t see why a 2,500 square foot office that is used as some non-local serving office just a general business office without being a travel agent or whatever offices or business uses might be local serving I don’t see that as less dense in its employment generation than a 5,000 square foot office. So I would disagree on that point. I still think we have a valid question of what sort of businesses we want to have permitted in what we are calling the retail corridor on the ground floor. Maybe Staff could respond to some of the definition questions that Bonnie raised on what sort of businesses would be permitted under general office. Would some of these things that are somewhat local serving be allowed under general office and prohibited under the other category of business services? Ms. Grote: Well, typically in the general business office category it does include real estate offices, insurance office, property management, title companies, personnel, travel offices. They are administrative primarily in nature. So that is a business service office. Page 21 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Commissioner Burr: I’m sorry, those are? Ms. Grote.: I’m sorry those are general business office. Commissioner Butt: You just said that if they are administrative primarily in nature. Let’s say we have a travel office that is a walk-in travel office. Ms. Grote: Right. Commissioner Burr: Is that a business service or is that a general business? Ms. Grote: That is a general business office. It just says that there are services rendered that are customarily associated with administrative office services but we do have these specific office uses such as travel, insurance, property management, real estate. Ms. Furth: They are generally paper pushing. There is a big distinction between general business services, which is doing stuff with things. Ms. Grote: Yes, furniture repair, boat cleaning, printing. Ms. Furth: Commercial bakeries. Ms. Grote: Publishing, blue printing. So it is an action oriented with a product as opposed to producing paper. Ms. Furth: Or electronic versions of paper. Commissioner Griffin: Would any of the Commissioners, in an attempt to move this item, make a specific proposal that we might discuss in more detail if that is the consensus here? Commissioner Cassel: I think it might be easier if we go down through this list, look at these items, see what we think of what is there and then go back and go chapter by chapter through this. Sometimes these connect and sometimes we have agreement on the size or the shape but not on the use. Ms. Grote: I think as the Commission was discussing a couple of weeks ago that the entire area is seen as a mixed-use area and that there may not be a need to differentiate so finely between Homer and Emerson and the rest of the district. Uses that would be permitted along Homer and Emerson are retail, restaurants, personal services, residential certainly and there are some other like daycare centers and things like that but those would be the primary uses. Those would also be allowed in other areas in other locations within the overall area. It is a relatively small area. think the vision for that area is to have an eclectic mix throughout the entire area and you may not want to so finely distinguish those two streets from the other streets with the exception of perhaps Alma and the west side of High where you have said there can be higher intensities and taller buildings. For the rest of it I don’t know that you really want to have such a fine distinction. Page 22 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Commissioner Holman: I am okay not distinguishing I was hoping the Commission might limit general office that’s why I was going for the Homer and Emerson corridors. Under my proposal I wouldn’t think that there would be any reason to distinguish between Homer, Emerson and the rest of the SOFA 2 area. I think Alma is considered separately or differently, that general office is allowed there, unless I was asleep somewhere I don’t remember that being also the case for the west side of High Street. I thought it was just Alma where the more general office was acceptable. Ms. Grote: In the Working Group proposal or where? Commissioner Holman: Both. Ms. Grote: The office use as recommended by the Planning Commission is allowed everywhere on the ground floor with these certain qualifications and it includes the entire area. For the Working Group it was no new office along Homer and Emerson or south of Homer for the general business office. Commissioner Holman: Righ(, then what was the distinction you were giving the west side of High? Ms. Grote: Higher intensity uses, taller buildings, greater FAR. Commissioner Griffin: I would like to see if we can’t obtain a consensus here to support this item as it has been presented before you despite all of our different takes on some of the different details of it. Nevertheless I would like to see if we can’t approve this item. Commissioner Packer: I support the way it is written here. I don’t support and absolute ban on new offices and I don’t think we should, at this point, go into fine ttming what goes on Homer and Emerson and let the market work it out. I think the restrictions that we have or that are set out here by the Staff that reflected our previous discussions are fine. Let’s go with that. That’s the way I feel. Commissioner Cassel: I would like to go with what is here. Commissioner Griffin: Pat, do you have a vote on this? Karen? Commissioner Holman: You have heard my opinion already. Just to reiterate I would not support new general office or new general business office anywhere in SOFA 2. That would be my ideal. Commissioner Burt: I think my inclination would be to go with what the Commission had been recommending except in the Homer and Emerson corridor that it should be business services as the permitted office. The reason I am struggling is that when I look the definitions there are ones among the general office that I would characterize as more akin to business services, a local travel agent, a local insurance agent. So that is why I am struggling. I think our definitions Page 23 1 2 3 4 5 6 7 8 9 ,10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 aren’t aligned at the right place. Weall see walled buildings that have gone up in this area and places down at Midtown where we have investment houses that create a very sterile street there, now we are not talking about street face on these so that’s the qualifying aspect of it. I would like to see the retail corridor if it is not retail that the businesses that are on that ground floor be ones that create a neighborhood vitality. I am not sure that other Commissioners support that position but that is my inclination. Commissioner Cassel: I think as we go through the policy sections we will see that some of that is enforced in the way the building is designed. That is going to be very critical. It is not the use, the building may be empty for a very long time and it may be offensive to some people but the thing that is most offensive is they pick the Venetian blinds and they close them and you can’t see anything in it so it creates a wall around the building. If it had open curtains, put a sign up so peoplecan see people inside and it wouldn’t seem so bad. It is the wall effect and I think we are trying to deal with that in the design. Commissioner Griffin: If you would permit me, I wish to join Bonnie and Phyllis in supporting the text as it is written. Under those circumstances that would be a three to two vote and if we could now end our discussion on this item .I wbuld also like to point out that we have been at this 90 minutes. If it would be appropriate at this time to take a break. Yes? Commissioner Packer: Just a quick question for Wynne. This has to do with uses. We have a uses committee, the definitions of the uses that you are concerned with Pat we are all concerned with. So my question is when the ZOU is updated will it apply to this? Ms. Furth: I think we need to discuss that when you come back from your break. It is going to be an issue that applies throughout the discussion. Commissioner Griffin: That being the case we will take a seven-minute break. Let’s see if we have consensus on item number three, PC Districts. Steve would you like to sub for Lisa? Mr. Emslie: Basically this works from the Planning Commission direction that allows P.Cs with caps in the RT-35 it would be up to a 1.5 FAR with 1.15 being the base and up to 2.0:1 in the RT-50. The conditions on which the PC would be granted would be determining whether or not at least one or two of the listed public benefits were present. One public benefit would be required to.be present for the RT-35 PC and two would need to be present for the RT-50 2.0:1 FAR. Commissioner Cassel: I have just one question and that has to do with the daylight plane limits. That question came up to us and off the top of my head I didn’t remember what those daylight plane limits were in the RT-50 or is it just the same as they were in the 1.5? Ms. Grote: In the RT-50 there are two daylight plane issues or places where daylight plane would occur. One, is those two lots along Homer where we talked about 15-foot step back and the 60% slope. The other is along High at that is again 35 feet at the property line and then a Page 24 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 45% slope back to 50 feet. That was depicted in. a graphic that was at your places two weeks ago. Commissioner Cassel: But there are no others? Ms. Grote: That is correct. There are no other daylight plane because in the RT-35 everything is at 35 feet and then the other place in RT-50 is along Alma and there isn’t that need for the stepping back or angling back along Alma. Commissioner Cassel: The alley? The south side of that lot? Ms. Grote: No, there wasn’t identified a need for a daylight plane there. On both sides of that alley it is going to be up to 50 feet so there is not a difference in the height on either side of the alley. Ms. Furth: The development standards should all be, for RT-35 and RT-50, should all be on pages 37, 38 and 39. So that is where you should find them. Commissioner Griffin: All right, Commissioners having looked at this item do we have a consensus to approve this item as it has been presented to us in the StaffReport? Karen. Commissioner Holman: I have a couple of suggestions. I have flipped back and forth on PCs it is really a tough one for me. Number three, childcare, I am thinking that it might be helpful to make that public childcare. Number four, public open space, I would prefer not to have paved open space. We talked about plazas, which actually I thought we were eliminating but it still shows up in the plan a lot, I would like to make that permeable or green public open space, if that would be agreeable to the other Commissioners. I will just go through these three things and then see how the Commission feels about them. Then the other thing is we don’t have and maybe this is an opportunity to start a penalty system for noncompliance of PCs. Sometimes they are inspected and sometimes it is on a complaint basis. It takes Staff time to go do that. I think it would be important and appropriate to put in a penalty, I am not going to try to define what it should be, but put in a penalty for noncompliance of PCs. Ms. Grote: Actually, yes, in Chapter 1868, which is the PC chapter in the Zoning Ordinande there is technically a penalty in that we can revoke the PC if there is a consistent noncompliance with uses or other requirements of the PC we could technically revoke it and return it to its underlying zoning. I understand your point. Commissioner Holman: Practically speaking, that never happens and there are occasions where different uses are put in place and Staff has to go and then really what happens is a fiand gets slapped and use has to get re-implemented to come in compliance with the PC but I am thinking that some other kind of penalty might be appropriate. Ms. Grote: There are administrative compliance orders, perhaps. Page 25 1 2 3 4 5 6 7 8 9 lO 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Ms. Furth: These are zoning violations that are no different than any other zoning violation. Having a bootleg business in your house for example. There is a provision that they. are supposed to be inspected every three years by the City, Commissioner Griffin: I am sorry I can’t hear yo.u. Ms. Furth: There is a provision already existing that the Building Department is supposed to go out and inspect all PCs every three years to see that they are in compliance. Part of the reason for having that is to make it clear that the City has the right to go inspect. Some of the recent PCs that we have written the City Attorney has added a provision where they consent to inspection particularly where we are concerned whether internal spaces are being use~ for residential or office purposes in mixed-use projects. I think that the full range zoning code violation procedures that we have are applicable here and I think we have the same difficulties in that we are going to have to prove violation of the law. So I recommend against putting in special penalty provisions here. I think we need to keep it in mind when we are doing the Zoning Ordinance Update and talk about are there better things we can do in code enforcement but that has been a continuing effort to develop ways of dealing with violations. I don’t think that PCs are different from other violations in our experience. Commissioner Burt: I am comfortable with Wynne’s explanation on that. I was interested in Karen’s recommendations. It seems that the public childcare may be an appropriate clarification. As far as the public open space being green I don’t know if folks are familiar with a pocket park onLaurel Street in San Carlos, it is their main street, that was created on what I guess is at most a 5,000 square foot lot. It is has become the downtown little mini park. It is a great example of the sort of thing that we would love to see created. It is not entirely greenspace but it is at least 50% green space. I don’t know whether that would work under all the PC constraints but I certainly am open to something that would move us more toward mini parks as opposed to purely plazas~ So I do want to consider that more. Then on number fi’ce, as I was thinking about this more, which is neighborhood serving retail space that is one of the public benefits for a PC in the RT-35 and we already have in the RT-35 essentially that is where a, I want to make sure I am remembering this correctly, the commercial space in order to get the .4 commercial space FAR .25 of that has to be retail. Am I stating that correctly? Ms. Grote: You can have up to .4 in commercial use. There is the office limitation, which says it is up to 2,500 or .25 percent but you don’t have to do the office. You can have the whole .4 in other types of permitted commercial use. Commissioner Burt: Right, but if they merely complied with those other permitted uses on the .4 or the balance of the difference between .25 of office and the .4 allowable commercial, so. 15 of office, they would be meeting their public benefit requirement for PC. Is that correct? Ms. Grote: No. Commissioner Burt: It says for an RT-35 district one of the following public benefits must be provided and one of those is neighborhood serving retail space. Page 26 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 46 Ms. Furth: They could do purely office and residential. Commissioner Burr: Okay, but they could also do a residential plus .4 of commercial of which ¯ 15 would be retail and that satisfied all the PC requirements. Am I reading this correctly? Ms. Grote: I think you are and you may want to take out neighborhood serving retail as a public benefit. You would then have five public benefits to choose from, it would be one of five, and take out that neighborhood serving retail. Commissioner Burt: I think we have given the incentives for the retail in the FARs. If the Commission agrees. Commissioner Griffin: Karen. Commissioner Holman: Actually Bonnie has her hand up. Can you clarify what you mean by below market rate space for community nonprofit services? Can you just clarify what you mean by that? What your intention is with that one please? Commissioner Packer: Cheap rent. Commissioner Holman: As opposed to having a room that is made available for public meeting spaces that is free. So you are differentiating. So it wouldn’t be a for free service that you are looking for. Commissioner Packer: These are PCs. These are going to have to come before us, or whoever is on the Planning Commission. At that time you look at these things and see if as a PC you can work with it. We may want to say that these are examples or that these are goals, it could be free, it could be below market. You may have to balance it with the project. It is just that we can’t design the particular PC in this plan. We are giving suggestions and that is why I would oppose that it be green, that it be public, that we don’t try and micromanage it, that we create these as suggestions. Maybe the preceding sentence for this is that these are examples of the kinds of PCs against which the decision-making body can test the beneficial aspect of the proposed public benefit that the developer is proposing. In other words, if they come up with some other idea that we haven’t even thought of like a tutoring program for kids or something and it isn’t on here but they say it is similar to this list. That is what I am trying to say. Commissioner Griffin: In that circumstance it seems like the text does not convey that point of view. Ms. Grote: That is correct. What the text says is that it must be one of these five public benefits. Commissioner Griffin: So consequently if it is the sense of the Commission that these be suggestions then we need to change the way this is stated. ’Commissioner Burt: I don’t think that was the sense of the Commission. Bonnie, when Karen asked this question I think it is entirely appropriate and reasonable that we establish clarification Page 27 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 as to what we mean. I don’t think it is appropriate to dismiss that question and go off on a bunch of tangents on it meaning umpteen different things. Let’s talk about what we mean. Commissioner Griffin: Alright would someone like to? Commissioner Cassel: I think the intent of giving a list was because people in the community have been very concerned believing that PCs have been granted for art projects. Already that is what they see everyday and they don’t remember whether that was two feet or five feet or 50 feet that wire granted. So there was a tendency explicitly to take out art as one although that had been explicitly included in the past. I think we need to keep them fairly broad. It is lovely to have space underneath that is green and filters properly, I agree, but if you have a parking lot underneath and that is the only way you can provide the parking lot you aren’t going to get that. So in that case I think we need to keep it broader. This is a nine-block area and specific cases are going to happen where we are trying to get greater intensity and where we are hoping to get some underground parking. So these public open spaces, we are going to be very fortunate if we get them and we need to be pretty broad in them. Commissioner Griffin: Karen, did you want to elaborate? Commissioner Holman: I am not trying to micromanage. What I am really trying to do is get intention out there. My intention would be that, and I think you can Phyllis, get greenery on top of parking garages. Commissioner Cassel: I thought what you meant by that was that it had to have nothing underneath it to make green open space. That is where we are getting into problems of real tiny detail here. That is the problem with an interpretation of a detail that I think is difficult. Commissioner Holman: So you were taking my word of permeable as meaning that there wouldn’t be a parking garage under it. Commissioner Cassel: Right. That is what I am worried about in getting into tiny details here. Commissioner Holman: No, I am just trying to discourage - my intention is to get more permeable, yes, but if there is a parking garage under - and I think grassy areas are more appropriate to this area than plazas as I have stated before because they are hardscape and it is a. transition area to a more residential neighborhood. So my intention is to read permeable/green ¯ space, something like that. That is my intention and maybe Staffhas a better way of phrasing that. Then childcare, the reason I was saying public is because I didn’t want a public benefit being something that a residential project came in and provided childcare only for their facility and consider that a public benefit. Ms. Grote: So your definition of public benefit doesn’t necessarily mean nonprofit, as long as it is open to the general public it could be a for profit establishment. Okay. Page 28 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 Commissioner Griffin: Because the language is set up the way it is naming these specific items and we have reduced by one the public benefits, we are taking out item number five for example, does anyone wish to propose a substitute benefit in the place of number five? Commissioner Burt: No, I don’t see a need for that unless somebody has a good idea on it. I would like to see if Staff has any recommended verbiage that would at least encourage the public open space wherever possible.to have shall we say green elements to it without prescribing it as a rind mandate. Ms. Grote: Would something like "well landscaped public open space" suffice? Commissioner Griffin: Whatever "well landscaped" means. I am pretty empathetic to both you and Karen’s wish to have landscape instead ofhardscape but by the same token if you have a small restricted area that is impacted by very many people you will quickly pack over and pretty well destroy any grass that is trying to grow in a small spot. Ms. Furth: We wouldn’t interpret "well landscape" to mean having grass necessarily. Commissioner Griffin: Say it again please. Ms. Furth: We wouldn’t interpret "well landscaped" to mean that it had grass necessarily. We might make everybody look at William White’s movie on pocket parks before they.make their submittals. Commissioner Burt: What does Staffthink one, conceptually about this and two about verbiage? Ms. Grote: I think "well landscaped" is a broad enough term that it would allow for greenery, it would allow for decorative pavement, decorative features in an area potted plants, planter boxes and things like that. It allows a variety of things. Commissioner Griffin: Bonnie. Commissioner Packer: This is just to maybe broaden this a little bit and I don’t know how it is going to be interpreted but if we added instead of the provision for neighborhood serving retail space we added a last item that said a public benefit of comparable value. That gives the decision-makers the question of is this as good as a pocket park. We don’t know what in ten years the public may thing is a good thing to have as a public benefit. There may be some other need that we can’t conceive of right now. Right now we are at a loss to think of what to add to this. That way if we say a public benefit of comparable value, not monetary value but value to the public. Ms. Grote: Comparable benefit. Ms. Furth: A comparable benefit I think is as far as we can go. Page 29 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Commissioner Packer: That gives a sense to the applicant and the decision-maker that they can go a little bit beyond this list if any one of these four isn’t going to work for that site. Commissioner Griffin: Sounds like that is a PC for a PC. You giv~ a wild card for a wild card. Commissioner Packer: Right now our PC requirements are so broad that this is an incredible improvement in my opinion. Commissioner Griffin: Karen. Commissioner Holman: I appreciate what you are saying Bonnie and I think that makes sense. It does make it more restrictive than what we have now. One other thing that I think we should be doing and perhaps this is a ZOU item also, but we should be reviewing the PC Ordinance much more regularly so that we can address what cultural changes and what environmental changes come up so that we can address these rather than letting the market come in and then pursued for something that maybe isn’t as good a public benefit. Commissioner Griffin: Wynne. Ms. Furth: Yes. I suddenly realized the stuff about leafy open space actually belongs, which is in the vision section in your policy section about what kind of and that is where it is. So when you are looking at these PC benefits you are going to go back to the SOFA 2 vision quest and see if it implements it. That is where you talk about you want leafy spaces, you need greenery down here, you want a lot of trees. Commissioner Cassel: That is where we go back to page 32 to pocket parks, plaza and courts. You add some of that into that. Ms. Furth: It may already be there. You have tons of language in there about trees. Commissioner Cassel: We have tons of trees everywhere, that’s nice, but design guidelines for private property, pocket parks, plazas and courts doesn’t happen to mention what Karen is talking about. In this piece as we go .through this and what is hard is Bonnie tried to get us to do this earlier and I got frustrated with it but what is hard is to go back and say is that covered back in our text. Ms. Grote: And it is. It is in program L-1 on page six and it says, "Develop comprehensive TDR and other desirable characteristics and uses including pocket parks and other public open space." Commissioner Cassel: Right but she is saying she would like to see in that some greenery and that isn’t in either of those pieces. Ms. Furth: We could add language if you wanted saying that leafy well-landscaped green spaces are particularly needed and desirable or something like that. Page 30 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Commissioner Burr: If that were added to either the vision section or the policy section then I would be fine with what we have under the PC recommendation as public open space as defined elsewhere. Commissioner Cassel: That way when they look at this they can refer back to what we mean by that. Commissioner Burt: So I would like to see us explore Bonnie’s suggestion on .whether we want a wild card in the public benefits. Within the Working Group one of the terms that was used was a significant public benefit. Now we do have public benefit of comparable benefit, is that what we are saying? Ms. Furth: A .comparable public benefit. Again you could tie it back in. That implements the SOFA 2 vision. Commissioner Burt: I think that that implies that it has to be a significant benefit that is consistent with the plan vision and I would be comfortable with that as a way to give latitude to things that we aren’t specifically envisioning here. Commissioner Griffin: Karen, what do you think about that? Commissioner Holman: I think that makes sense. What are we going to have as far as a revisiting of this? I presume we are not going to be revisiting this regularly. You said vision quest, the only thing we didn’t do as part of the SOFAprocess is maybe a Rhobes course. Should be come back maybe every two years and look at the PC aspect of this? Ms. Furth: Planning can talk about this but I will give you my opinion which is you have a Zoning Ordinance Update to do and you look at the PC ordinances when you look at PCs. That is self-correcting in that way. There is plenty of power to say yes or no under these ordinances. Now the yeses or nos that will be said will depend upon the decision-makers ultimately but I don’t think you are going to be successful in giving much more direction. You have a lot of direction here compared to anything we have had before. The other thing you need to remember is that you have constrained the FAR, the height and the daylight planes so you have already told people what it is you are looking for. It is not this wide-open thing that the usual PC is. The SOFA 2 PC is a much more defined creature. People that own property can probably tell you exactly what you have prescribed. Commissioner Holman: Well that was exactly why I raised the question earlier about whether we want to do it as a part of the ZOU because this PC is much more restrictive that is why I posed the question of do we want to revisit it because we don’t know what. Ms. Furth: You may want to but you are not going to have time to. Mr. Emslie: You are scheduled to review the whole PC process as part of the ZOU. That is already in your work program so that will happen. I agree with Wynne that a review of how the PCs are going is going to be mute. I think that any project that rises to the level that would even Page 31 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 -17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 contemplate a PC would clearly be something that the Commission would be well aware of, Staff would be well aware of so any Commissioner could inquire as to how this is working. If there is an issue we could always give you a verbal report at a Planning Commission meeting. So I think there is lots of time and opportunity for feedback for testing. You can check in with us as we go through and as development proposal arise and they come to your attention. Commissioner Griffin: Okay. I would like to move this item now. If Commissioners are satisfied with the two modifications that we have made to this list, one the leafy glade green space and the wild card item to provide a valuable public benefit. Do we have a consensus on the Commission that this item can now be approved as amended by these two additions? Commissioner Holman: Yes. How do the other Commissioners feel about the public childcare? That was the other item that I raised. Commissioner Griffin: Were there any comments on the public childcare? Commissioner Packer: I really don’t think it is necessary for childcare to work. They will be open in order to get the business and the teachers. I don’t know. I think again when the decision-maker looks at the proposal for the childcare facility as opposed to just a little baby sitting arrangement. Commissioner Burt: So what is the harm of adding that clarification in? Commissioner Packer: Probably none. Okay. Commissioner Griffin: Good. Mr. Emslie: It will be childcare open to the general public. Commissioner Griffin: There we are. Well we have consensus on that item. So I would like to move to item number four. Did you have a question that you would like to interject? Commissioner Packer: Just one little small thing, this is for Wynne. This is related to PCs. In the section on the establishment of Planned Community Districts the whole process I think a clear reference to the section we just Ms. Furth: What page are you on? Commissioner Packer: This would be page 59. A real clear reference that when the applicants submits a development plan it shows that it is conforming with the requirements of this section that we just agreed to, 5.110. In the process there is a clear reference to this. Ms. Furth: Are you Saying we should add one? Page 32 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Commissioner Packer: It doesn’t say in the development plan. This was just lifted from the existing zoning ordinance. It doesnYt clearly refer to the requirements in Section 5.110. So you might want to look at that and see flit is. I don’t want to take anymore time here. Commissioner Griffin: Good, thank you. Would you please proceed Lisa? Ms. Grote: The next item is parking. The recommendations from the Commission have been to allow reduced parking, which would be available with a Transportation Demand Management program. The parking requirement would be as outlined primarily on page 47 and 48 of the document. Then also that a reduced parking amount up to 20% of the requirement could be granted for joint use parking and that would be in a mixed-use project. Commissioner Griffin: Karen, do you want to make a comment on this? Sorry. Bonnie. Commissioner Packer: I probably should have brought this up in connection with FARs. Defining what kind of parking is included or not included in the FAR calculation. Remember that came up? Ms. Grote: I do recall and we tried to capture that in the definition of gross floor area and that we would not count parking that is four feet or less above grade in the floor area calculation. Let me check to see what page that is on. Commissioner Packer: I was looking for that and I didn’t see it in the plan so maybe it is buried somewhere. I think it should be up front somewhere that is clear for the applicant. Commissioner Bur~: I had a couple of parking questions. Sorry for jumping in. Ms. Grote: We will add it up front and let me continue to try and find it. ! believe it is in here we talked about that a great deal. Ms. Furth: We can restate it in this chapter too so that it is clear. Commissioner Burt: I had two parking related issues. One is related to this podium parking. What are the chances that ARB is going to approve a proposal that has podium parking? My understanding is that they don’t think much of it and we may put it in the plan but that they aren’t very likely to_ support de.signs that have it. Ms. Grote: If it is a permitted design, if it is a permitted feature the ARB will not be able to deny it. They won’t be able to turn it down if it is something that is permitted. What they may be able to do is make it look better, to landscape it better, to have better materials around it. In fact they have reviewed other podium parking in SOFA 1 and did in fact approve it and made some very good suggestions about how to make it look better in those cases. Commissioner Burt: Good. Then my second question has to do with tuck-in parking. Is that the correct term? Page 33 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 ¯ 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4o 41 42 43 44 45 46 Ms. Grote: Tuck-under parking is sometimes as referred to at grade parking that is tucked under a portion of the building. So the grade level is parking and the first floor comes over it to a certain extent. Commissioner Burr: As I recall when we were reviewing the first Creamery project one of the features that was viewed very favorably by the neighborhood merchant, Palo Alto Hardware, was that there was tuck-under parking in the alleyway. The notion was that that would address significantly the tendency for people to want to park at grade. Without that there would be a greater competition for on street parking if we allow these kinds of densities that we are advocating in order to increase the housing supply and that the Commission has supported then are we going to create a potential detriment of greater competition for the on street parking which is already very limited in this neighborhood? Currently as the plan is proposed I believe tuck-under parking counts against the FAR. So my question for the Commission is should it count against the FAR or should all of it count against the FAR or should there be some amount of tuck-under parking that is exempt from the FAR in order to try to reconcile these competing interests? One is to increase housing density and the other is to not be harmful to existing retail and to create essentially an incentive to mitigate that harm. Commissioner Griffin: So in Alison’s prototype where-she showed tuck-under parking then it did count against the FAR? Ms. Grote: In most of Alison’s prototypes it showed podium parking and we did not count it in the FAR because it was designed to be that four feet or less above grade. So we did not count that into the FAR calculation and that was podium. For the tuck-under parking, which is fully above grade but partially covered by a second floor of a building, that is a different situation. That is fully visible. Currently in the Zoning Ordinance if it is primarily enclosed it is counted as FAR. If it is primarily unenclosed then it is not counted as FAR but in those cases because there is a back obviously because it is the building and then there is a top because that is also the building so there is a cover it means that the sides, the two ends, have to be open in order for it not to count as FAR. If they are closed at the ends then it counts as FAR because then it is primarily enclosed. It goes .on a strictly mathematical calculation. If the full back is closed and the top is closed then it means both sides and the front have to be open for it to be unenclosed. Commissioner Griffin: Karen. Commissioner Holman: In my head I am getting pictures of buildings growing and column supports be given for buildings and surface parking be provided and it not be counted as FAR. So I am a little doncemed about the proposal respectful as I am of your concerns I am concerned about that proposal unless you would really limit it to an absolute strict number of parking places or something like that. Commissioner Burt: I agree that that’s the downside that it has the potential to increase the mass of the building and consequently I think that if we do allow some encouragement for the tuck- under parking that we should put some constraints on it so that it is not a carte blanche to increase the mass of the building beyond what we would think is appropriate. Page 34 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3O 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Ms. Grote: I would also add that you may want to consider what it does to the streetscape itself. It tends to put holes in the streetscape so that there would not be that continuous building frontage. You might have either an entrance to a parking area or parking itself right along the street. Commissioner Burt: I am sorry I didn’t explain this well enough. What I was envisioning was on alleyways. I should have included that as a caveat on this so that it does not harm the streetscape or as Karen just said, behind buildings but in a way that it is not on the street face. I would certainly agree with that as well. Commissioner Griffin: Phyllis. Commissioner Cassel: Can I go on with another question and think about that a minute? Ms. Furth: You do have a whole bunch of parking policies on page 31 and they do talk about having short term parking which can be seen as accessible parking outside underground garage storage. That I think is how this plan tried to address that issue of having really convenient accessible parking while still dealing with the issue of wanting to screen parking if not trying to create what feel like unsafe spaces because they cannot be secured. Commissioner Burr: I agree. I was really a very strong advocate of inclusion of that language. .I think that that language diminishes the need for how much tuck-under parking is need. So that goes to the point of I don’t think we need to have a carte blanch exemption from FARs but we may want to within certain limits allow tuck-under parking where it is not harmful to the streetscape. That is what I would like us to consider and I realize that it is something that Commissioners may need to digest,for a minute and we could move on and look back to that but this is our last crack at it and if there are things that we didn’t get previously and they were the right thing to do then we still need to struggle with them tonight. Commissioner Griffin: I would like to have a little feedback from Staff on consequences and unintended consequences of this sort of thing. Have you had a chance to noodle this around a little bit? Mr. Emslie: We have and there are a couple of considerations. Security. Alleys are not and there is the prototypical dark alley so we need to be careful in making sure that these spaces are open enough and well lit to give you a sense of safety especially if they are going to be used for retail. That is going to be very important for the desirability of these. As Lisa mentioned it is really the degree to which these become enclosed. They can have a roof and they can be enclosed on up to two sides with building and not count towards FAR. I think that is also a factor that contributes to the openness of this space and the usability of these and the perception of safety in the tuck-under parking. So you might consider if you do want to allow this to have maybe some standard that promotes .a limited amount of enclosure and really more of a visibility aspect to these. Another factor I can think of is they are really perceived as very private. They will look like somebody’s private garage. It may not be readily apparent to a retail customer that it is okay to park there. There are certain psychological signs that it even though it is available it just doesn’t work because it has a real private kind of appearance. I think having a certain Page 35 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 .16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 degree of openness is important and I think that is important too to help mitigate the mass and bulk of it because clearly it is volume of space that is going to contribute to the overall appearance and mass and bulk. So I think having some sort of openness standard would be something for you to consider. Commissioner Griffin: So ifI understand it correctly it is already taken care of though. If we are saying that as long as the tuck-under parking does not have ends then it doesn’t count against the FAR and consequently we may be pursuing something that is already dealt with. Commissioner Burt: If you envision a building that you have a side of a building and then an alleyway you would have a group of tuck-under spaces. Commissioner Griffin: Further down the alley? Commissioner Burt: Wherever; it might be on the edge of the building. Does it really look right to have that cutout from a side view, say from Channing Street, that is not a wall of that building, that does not look like it is part of the architecture? I am not sure that we would want to say the only way you can have tuck under is if you have this big cutout there. Commissioner Griffin: I have seen this done, if you had a screening effect, in other words if you have a cinderblock fixture that is open and you win.d up with a semi obscured end piece. Commissioner Burt: I just don’t know if we can go into architectural details tonight. I think we can hit the concepts. Commissioner Cassel: Well it is a brand new concept for me and it has a lot of implications and we haven’t talked about it before. I have a sense that we are trying to design something to meet a specific need with a specific owner. Commissioner Burr: It is a concept that I think is one that we would want to look at throughout the plan area. I am not looking at it as a narrow utilization. I think the security aspect that Steve mentioned is an important concern although I think that in this case the property owner is going to be concerned with that. We do have another question too. Does it need to be open to the public? That is another sub-question of this. If it were for residents but they would choose to utilize that versus competing for on-street parking it still might serve the same purpose of continuing to make the on-street parking available for other general public uses. Commissioner Cassel: Having considered that I think what we would be trying to do is encourage people to go with more podium parking or underground parking by incentivizing that. If you then go up to tuck--under parking and I have never seen good looking tuck-under parking but if you do that you have dropped your incentive for going underground. I think that was the purpose of not counting that space was to incentivize the underground or the podium parking. Commissioner Packer: I agree with what Phyllis said and I am thinking about the irony of wanting to incentivize the above ground space for parking by not including it in the FAR. At the same time we want to have incentives for residential units. Why not not include residences in Page 36 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 the FAR? Are cars more important than people when you look at the irony of it. So I think we should leave well enough alone. There are wonderful design guidelines for alleyways on page 25 and all the parking design guidelines on page 31. They give a lot of ideas for ways you could use surface parking. The other thing to keep in mind is that people will find greater incentives to use public transit when it is hard to park. The easier we make it to park the less likely they are going to use the shuttle or whatever improved public transit we get in this town. So keep that in mind. We don’t have to always provide parking for every instance. We want to encourage people to be discouraged about using their automobile because it is too hard to park. That is why I never drove to San Francisco it was too hard to park. Commissioner Burt: I would just like to add to that though that this neighborhood already has a parking deficit. What we have proposed here as a Commission is an increase in the FAR density beyond what the Working Group had recommended in order to achieve our objectives of providing additional housing for this area. This concept is one that is designed to try to mitigate the negative impacts that might go along with that. So if we bear in mind that we already have a deficit, we are not talking about a circumstance where we have surplus parking and we are going to .keep it surplus and discourage use of transit. So I think we need to keep that circumstance in mind and my motivation is to try to mitigate the impact of the one desirable social goal that we are trying to promote here without creating an unintended negative consequence on another goal that we have for this area which is to support the retail vitality. Commissioner Griffin: I would like to see if we can’t terminate this item and keep going. We have a lot more left on our plate tonight. So Karen if you want to make a last comment here that would be appreciated. 21 22 23 24 25 26 Commissioner Holman: Because parking is so complex there are a few issues. One is 27 something that I think Bonnie brought up a couple or seven meetings ago about SOFA, which 28 was providing short-term parking. I can’t remember what Bonnie suggested but I was thinking 29 short term parking along Homer and Emerson and maybe where there are existing retailer 30 services to provide, and I am not the expert here, a minimum number at least of short term, like 31 30-minute, parking spaces there as well. In addition I had mentioned at one of the meetings and 32 I talked with Steve about this previously too to require a 40% TDM program with all existing 33 and new business to help relieve some of the traffic and parking congestion that Pat is talking 34 about. My concern about reduced parking requirements here is as Pat said it is an area that 35 already suffers from not enough parking as it is and while Bonnie makes a point that if it is hard 36 to park people will take alternate transportation. A lot of times in this neighborhood if it is hard 37 to park people will just park in the neighborhood. So I think maybe a TDM program might help 38 relieve that and the short term parking while that might push some cars into the neighborhood it 39 is also going to help support the services, I believe. So those would be some of my 40 recommendations. The other thing about the reduced parking that I have concerns about is we 41 need to decide if we are transit oriented development or if we are a mixed-use development. I 42 have long said that if it is a mixed-use development reduced parking doesn’t, the premise is 43 incorrect because if you are near transit you want people to leave their cars at home and take the ¯ 44 train for instance. So the residential people are not taking their cars out of the building when 45 workers are bringing their cars into the building. So the premise needs to be specified here. If 46 you want people to reduce the parking requirement for development and it is a transit oriented Page 37 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 .39 4O 41 42 43 44 45 46 development then it seems to me that the premise would be that they have to comply with some kind of transit management system or program. Commissioner Cassel: What we are working on is number four, it says what we recommended was reduced parking available with a TDM program and reduced parking up to 20% available with joint parking. What it doesn’t do is come to your level of 40% and I am not sure we can do that. I am not sure that no matter what we do that will happen but I think that part of it that you wanted is basically what we were supporting. Correct? Then you have to go back over to page 47 and look at what ways we were talking about doing that and whether that is reasonable. I think I hear you saying Karen is that you don’t want us to do the reduced parking of up to 20% with joint use. Is that what you are saying on that one? You don’t want us to do a reduced parking program but you want it to be very specific in numbers. Commissioner Holman: Correct. Commissioner Cassel: And more so than what we have talked about and you these numbers in this document are not adequate. Then you are saying you don’t want us to have reduced parking up to 20% for joint use parking. Commissioner Holman: Correct. I am saying we need to have a plan that is going to work. There is confusion it seems to me between whether it is a mixed-use area or if it is a transit oriented area. The other point that I would make just to put another thing out there is ifI remember correctly, even for the lower FARs reducing the parking requirement doesn’t enable more units it just is fewer parking spaces. Ms. Grote: Actually a couple of things. One is of the TDM program and a reduced parking rate for a mixed-use facility that is close to transit. The premise is that the people that live there are not taking their cars away from the site but people that work there are also not bringing cars in. They are coming via public transit so they don’t need the parking space because they are not using their car to come into that building. They are getting there via public transit. So that is the premise behind a reduced parking rate for a mixed-use commercial/residential project near a transit center. There are a couple of other things. One is this 20% reduction available for joint use parking is something that is currently allowed in Title 18.83, which is the Zoning Ordinance. It is a reduction that is approvable by the Director based on parking studies that show there is in fact a viable program in place and that the use doesn’t need those additional spaces. So that is something that is just carried over from the existing code. Also I would like to point out that for those projects that are exclusively commercial, which would not include residential uses there is only a five percent reduction with a TDM program. So the really larger reductions of 20% are for those project that have the residential component. Commissioner Cassel: That is consistent with the Working Group plan as well. Ms. Grote: Actually, parts of it are consistent with the Working Group plan. The Working Group did not want to see reduced parking across the board for residential units or with a TDM program. They wanted to see the requirements in Title 18.83, which is our standard parking requirements, applied. Page 38 1 2 Commissioner Holman: Lisa, I appreciate your first explanation and that is not how I have read 3 the reduced parking in here. It just talks about shared parking which to me and how I read this is 4 that some go and some come and that is not the premise I think we ought to be applying here. 5 What you explained makes sense but I think the plan needs to be clear that that’s what is being 6 proposed. 7 8 Ms. Grote: We can look at the wording and clarify that. 9 10 Ms. Furth: We want to be clear. It is not one of those ones where the restaurant goers come 11 down and use the parking after the office goers leave for example, not that kind of shared use. 12 There is another premise incidentally which is that the number of cars per household drops one 13 hopes in a transit oriented or transit accessible area. Typically we have more cars than drivers in 14 household and you change that ratio. 15 16 Commissioner Griffin: One hopes anyway. 17 18 Commissioner Burt: I would like to add to that that the rationale for a reduction from either a 19 mixed-use or a transit oriented development is well established. What we have here is both. So 20 instead of your concern, Karen, about it has to be either or instead I reason that it is cumulative. 21 You have a reduction as a result of it being mixed-use and a reduction as a result of it being 22 transit oriented. It is not a reduction due to the transit orientation because it is mixed-use it is 23 both things together that cumulatively create a greater reduction in the parking demand than -24 either along would do. 25 26 Commissioner Cassel: Can I suggest that we see how many of us agree with this parking item 27 number four so we can move along? I think we have about ten or 12 items tonight at it is now 28 almost ten o’clock and we need to get through this. 29 30 Commissioner Packer: I agree with it. 31 32 Commissioner Griffin: Phyllis. 33 34 Commissioner Cassel: I agree with it and I agree with changing this language here. It says if 35 car-share and I think that was what the intent was, it.is joint parking. 36 37 Commissioner Burt: I agree with the language as well. 38 39 Commissioner Holman: I still have a question for Staff. Does reduced parking for the 40 residential aspect actually get more living units? I thought at the lower densities it did not? 41 42 Commissioner Cassel: Can we make a motion so that we can come to consensus so that we can 43 move along? 44 45 Commissioner Holman: I will just leave that concern out there and just be on record with that. 46 That’s fine with me. Page 39 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 Commissioner Griffin: Thank you. So we do have consensus because I am joining with the other four. Karen, do you want to join us? " Commissioner Holman: I left my concerns on the table and I will just leave it at that right now. Commissioner Griffin: Alright. Now we are ready for item five, ground floor Office. Ms. Grote: I think you did do ground floor office. You wrapped that into your conversation about FAR earlier this evening. Ms. Grote: You are now on number six which is the nonconforming uses and facilities. Your recommendation has been to allow nonconforming uses to remain as the same type of use except that nonconforming office use may change to retail use or other permitted non-office use and later return to that office use should it not be successful in the permitted use. Commissioner Griffin: So I am going to ask Commissioners again if we have consensus on this item. I would like to move it and so I am going to ask,_Bonnie are you in favor? Phyllis? Pat? Commissioner Burt: I certainly am and I just would like for the minutes to reflect the rationale the Commission had previously discussed which is that this is intended as an encouragement by allowing conversion to retail with the potential that it would eventually revert to office. It will create a greater number of circumstances where office might convert to retail and that is our motivation. Ms. Furth: Just as a point of information we have to correct some of the wording we wrote to actually make the text and the plan reflect your direction which we will do. Commissioner Holman: Two things. I think the Working Group recommendation here I believe is miss-stated. The Working Group, unless I am reading this incorrectly, the Working Group didn’t require nonconforming uses to become compliant. Am I reading that incorrectly? Ms. Grote: What this basically says is that nonconforming uses and facilities shall conform to 18.94 which states that yes, they can continue but that if they are vacated for over a 12-month period then they must become conforming uses. They can roll over if they are not vacated, they can roll over from one conforming use to another. Commissioner Holman: Thanks for the clarification. Consistent with my previous comments my comments on this are that I don’t agree with this just because I want to limit it to existing non-conforming uses and facilities may remain as the same type except that these existing nonconforming office uses may change to retail uses and later return to office use. The word ’retail’ I think there is some inconsistencies in here language wise. Should that retail word be changed to non-office commercial? Page 40 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Ms. Grote: It should. I think throughout the summary chart especially we have used retail as a shorthand for meaning non-office commercial use. We can change the summary chart to be less specific and more general. Ms. Furth: I have a question about only existing nonconforming uses because there won’t be any more new nonconforming uses until you change the zoning again. Commissioner Holman: What a point. Commissioner Burt: So with that clarification, Karen, what is your feeling on this? Commissioner Holman: I am fine with it as long as the word ’retail’ just for consistency purposes changes to non-office commercial if the other Commissioners are in agreement with that. Commissioner Griffin: Alright, so Pat are you in favor of the revised wording? Alright then we do have consensus on this item. We will move to item seven. Ms. Grote: That has to do with residential densities and maximums and minimums. In the RT- 35 the maximum density for residential would be 30 units per acre. In RT-50 it would be 40 units per acre. For senior housing or affordable studio apartments it would be in RT-35 40 dwelling units per acre and then in RT-50 50 dwelling units per acre. We are recommending and the Commission has recommended implementing a minimum density as well. In RT-35 it would be 15 dwelling units per acre and in RT-50 20 dwelling units per acre. That is to ensure that at least half of the allowed density is achieved on individual sites wherever possible. Commissioner Griffin: Is this the first instance in our Zoning Ordinances were we have established a minimum? Ms. Grote: Yes, it is the first time it has been very clear. In our Zoning Ordinances all the multiple family districts do have ranges such as in RM-15 it ranges from eight to 15 units per acre, in RM-30 it is 16 to 30 units per acre but there is no required minimum. It doesn’t say you have to develop at that 15 units per acre or you have to develop at a certain percentage of the maximum allowed. It allows anything within that range. What you are saying here is that you must be at that 15% in RT-35, 15 dwelling units per acre or up and in RT-50 you must be at 20 dwelling units per acre or above. So it is the first time there has really been a minimum established absolutely. Commissioner Griffin: Karen. Commissioner Holman: When I was reading this again I was considering that we might want to add a minimum unit size. Having seen problems with that before. Have I overlooked that and it is here? Ms. Grote: You are right. I was thinking there was a maximum unit size, which is 1,500 square feet, but you are right, we don’t have a minimum in here. Page 41 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28’ 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Commissioner Cassel: I will speak against that because you can’t get them down below a certain size because of building standards. That is pretty small but if you are going to do senior units we have them as low as 250 square feet. I think we are going to get ourselves really constrained if we put a minimum size. Our goal has been to get units smaller. If we have any kind of hope at all of getting them smaller so they can become "more" affordable that if we can put a maximum size on it this is going to be very creative and something very new. Commissioner Griffin: Bonnie. Commissioner Packer: I agree with what Phyllis says and I agree with all the densities as set out. I just have a question that may kind of help the concern that Karen has about a minimum size and the livability of a unit. There is one whole area that we forgot to address that is the open space requirements. I don’t have a particular proposal and I don’t want us to have such expansive open space requirements as are in the existing RM-30 and RM-40 districts. Commissioner Griffin: Is this part of this item? Commissioner Packer: There is no other place to raise-it and I thought this was the closest place. I don’t want a proposal. Maybe Staff can throw in some language about a certain amount of open space, the balconies and those kind of things, we have nothing in here that spells it out anywhere in the development standards. I think it is an oversight and I think there should be something reasonable in here about the open space that would kind of address the livability of small units. Commissioner Griffin: Did Alison deal with any of that in her prototypes? Ms. Grote: In the prototypes I believe there were private usable open spaces included which would mean balconies and patios. There wasn’t any common usable open space included and that was primarily because of the limited space on most of the sites. Some of the biggersites you can put in small circulation areas or areas where people could congregate but on the smaller sites there isn’t room for that. So there was private usable open space included which is usually a balcony at eight feet deep by ten feet wide or a patio ten by ten, that kind of thing. So we can put those private usable open space requirements in. Commissioner Packer: That’s all if the Commission has a consensus on that. I just had to find a place to squeeze it in. Commissioner Griffin: Pat. Commissioner Butt: Well I thought you were pushing common open space and I would like to see us push that as hard as we can. I appreciate that it is difficult to achieve that when we have higher densities but I think it is a very important component. Whether it is a small common garden or even something that could be conceived of on rooftops, we saw that Cedric had some illustrations of some very creative terracing concepts. I don’t presume that tonight we can define what those would be but I would like us to emphasize common open space as a constituent of Page 42 1 this density and perhaps we would then leave it to the subsequent review to further refine that but 2 I think it is an important component. 3 4 Commissioner Griffin: Would that go under design standards? 5 6 Commissioner Burt: Staffwhat do you think? 7 8 Ms. Grote: It is usually included under development standards and it is a percentage of the 9 overall site and usually there are some minimum dimensions at least for the private open space 10 not usually for the common open space but for private there are usually minimum requirements. 11 12 Commissioner Burt: I was just going to say that if there is a consensus among the Commission 13 of this as a direction would we feel comfortable tonight just asking Staff to include a greater 14 emphasis on this in the development standards? 15 16 Ms. Furth: I understood you to say you wanted to emphasize usable common open space. 17 18 Commissioner Burt: Correct. 19 20 Ms. Furth: As the desirable feature here. Okay. 21 22 Commissioner Packer: I would think both. 23 24 Commissioner Griffin: Karen. 25 26 Commissioner Holman: Yes and thank you Bonnie for bringing it up. 27 28 Commissioner Griffin: Alright, with that. 29 30 Commissioner Burt: I have another issue under density. We have under the Comp Plan policy 31 encouraging SRO housing. Could Staff repeat for us, if they recall of the top of their heads, the 32 density of our current SRO project at Alma Place in terms of units per acre? We have how many 33 units there and it is how many acres? 34 35 Ms. Grote: It is very high. I am sorry I don’t remember. I think it is in the 70 to 80 units per 36 acre range and I don’t know the exact numbers. 37 38 Commissioner Burt: That is what I thought. So what we are doing here is we are prohibiting 39 anything similar to that including on this prospective site of the substation. So I am concerned 40 that we don’t have any latitude in this language that would really permit an SRO type of unit or 41 something even a bit larger in unit size than the SRO. The FAR on that site is what? 42 43 Ms. Grote: It is about 3.8. 44 45 Commissioner Burt: Okay, so we wouldn’t allow that as I think about it then. If we have our 46 FAR limitation at 2.0 then 50 units per acre would be in the neighborhood of what we are Page 43 1 allowing here. Okay. I wanted to make sure that we weren’t excluding that potential from the 2 plan. So as long as we are not doing that then I am okay with what we have. 3 4 Commissioner Griffin: Then I would like to poll the Commission. Bonnie are you in favor of 5 the way it is set up at the moment? 6 7 Commissioner Packer: Yes. 8 9 Commissioner Griffin: Phyllis? 10 11 Commissioner Cassel: Yes. 12 13 Commissioner Griffin: Pat? Karen? Alright, we have achieved another one. 14 15 So Lisa if you would take through item number eight, historic preservation standards. 16 17 Ms. Grote: I will ask Wynne to take this one. 18 19 Ms. Furth: For item number eight I have to ask you to look at the policies not at the text at the 20 end. I regret that in our various summer excursions I gave some overly quick instructions and 21 we ended up with the wrong procedures in here. 22 23 Commissioner Griffin: Could you quote a page for us please? 24 25 Ms. Grote: Page 67 is the page for the inventory procedures. 26 27 Ms. Furth: Which is what I am telling you are incorrect. In the policies themselves are back 28 elsewhere and they are not incorrect. 29 30 Ms. Grote: They are at the beginning of the document on page 20. 31 32 Ms. Furth: The policy you adopted for SOFA1 is that all National Register eligible buildings 33 have to be treated in compliance with the Secretary of the Interior’s Standards. The result tends 34 to be even more inclusive for commercial projects because they have CEQA implications when 35 you do design work on them but these also cover R-2 properties in both SOFA 1 and SOFA 2. 36 37 I should just start with what it says here. The language is on page 20 and page 21. It is very 38 similar to the language that you had in SOFA 1. It talks about the importance of this area and 39 then it says the historic resources in SOFA 2, and those are the buildings listed in Appendix F, 40 shall conform to the Secretary of the Interior’s Standards for rehabilitation when undergoing 41 alterations or additions. So that is an affirmative requirement to preserve historic resources. The 42 historic resources list was compiled by Dennis, it includes both buildings that are on the existing 43 inventory and buildings that have been identified by the City’s professional consultants as 44 eligible for the National Register or the California Register. 45 46 Commissioner Holman: Actually Wynne it is properties. Page 44 1 2 3 4 5 6 7 8 9 lO 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 Ms. Furth: You are right it is by address. It is possible that there are some .buildings that are currently on the inventory that no longer have historic integrity because we have not been through a process of eliminating buildings. They have not be regulated they have just been identified. So if it were the c’ase that a building, and it may be that Dennis already knows that all of these are still historic structures, but the intention of the historic inventory section was to make it clear that if we have a building that is on the inventory that has been so altered since it was put on it that it no longer would be considered historic it can come off. At the same time if somebody wants the benefits of being an historic structure they can apply to be added to the City’s inventory. I gave unclear instructions and it looks like we are talking about amending inventory procedures when that wasn’t the intent so we will change it. Commissioner Griffin: Phyllis, go ahead. Ms. Furth: Basically the policy is that historic buildings have to be kept historic. Commissioner Cassel: Okay, meeting the historic inventory guidelines are fine. I had two different questions. One is, was it ever considered to make Homer and Emerson especially at that comer an historic district? Did the Working Group talk about that and not do it for some reason? The other is a question on process. Commissioner Holman: There was talk on the Working Group early on in SOFA 1 even about making Homer Avenue an historic district. We just never go to it with everything else that we were trying to cover. We didn’t get to it. Ms. Grote: I think then as SOFA 2 developed and evolved and the conversations that the compatibility standards were added or standard was added which directly addresses those historic buildings and how new buildings can fit with those historic buildings. Also the Joint ARB/HRB review process was felt to be an adequate way and a successful way of addressing historic resources. So there wasn’t further discussion about making Homer an historic district. I think there is an acknowledgment as well that the entire area has some historic qualities and character to it and again the compatibility standard and the review process addresses those characteristics. Commissioner Cassel: Okay, then that leads straight into my next question. I think we discussed this to some degree and that is the process here involves this HRB/ARB review which I think we agreed to go along with but then my question was, and I think we never had time to discuss this, we are covering every historic building and every building it touches and that means we leave something like 14 out of 84 properties out of the discussion. It seemed to me that you would want to do all of them or just the historic buildings. It didn’t seem to make sense to leave 14 of them out. I went through and counted all the properties and which ones didn’t touch anything and there wasn’t much left. Page 45 1 2 3 4 5 6 7 8 9 ¯ 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Ms. Grote: I think a couple of weeks ago the consensus at that time was to leave the process as a Joint ARBiHRB review for everything that is either historic or adjacent or directly across the street, opposite, that historic resource. That would leave about; according to some of the counting that we did, 20 or 21 parcels that wouldn’t be affected but it is some small number of parcels that would not be reviewed by the Joint Board and would only be reviewed by the ARB. So the question really becomes would you rather recommend that the entire area go through the Joint Board or would you rather recommend that a small percentage of the buildings only go through ARB and the rest go through the Joint Board. Commissioner Holman: I think as I stated previously I am okay with the historic properties, the adjacent and the across .the street and then the other properties going to the ARB. I don’t see any procedural or consistency problems with allowing the other properties just to go to the ARB. Commissioner Griffin: I would like to see if we have consensus on this item. Commissioner Holman: I am not through with the whole preservation issue about this aspect. Commissioner Griffin: Do you wish to bring up another point on this? We all are in agreement on this first go through? Commissioner Packer: I am in agreement with this go through. I don’t have any problems with the rest of it either for future consensus questions. Commissioner Griffin: Thank you for your cooperation. I for one appreciate it. Phyllis, any comments here? Commissioner Cassel: No, I think for me I would do the whole thing because it doesn’t make any sense to do such a few the other way but I will go along with all of you. I don’t want to delay it for that. Commissioner Griffin: Pat, do you have some comments here? Alright. Commissioner Holman: It is fine with me too. I do have other questions about this category though. Ms. Grote: I think what we did then was go to number 12, which is process, and agree on the process, that it would be a Joint HRB/ARB for those that are historic, adjacent and across the street from historic sites and then an ARB for those that are not in that category. So I think we took care of number 12. Commissioner Griffin: I am not following you here. Ms. Grote: We will return to number eight which is historic preservation standards and we Will continue that discussion but what you just didis come up with a consensus on number 12, which is process. That’s great. Page 46 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Commissioner Griffin: Now, Karen you had some more on this. Commissioner Holrnan: I do and I actually have an additional thing on process, which again I didn’t find in here. The Working Group mentioned and was pretty adamant about and I agree with them that the ARB/HRB get training in compatibility standards prior to this review process beginning. The problems with the first go around with this was that it was a new process and there wasn’t a standard, there wasn’t training and additionally I think it would be helpful for the ARB to have at least some level of training with the Secretary of the Interior’s Standards so that there is a level of understanding from both sides then whatever the ARB thinks that the HRB needs to be trained in but basically training needs to happen so that there is a good clean process for everybody involved. Ms. Grote: We would agree with that. The Working Group was very definitely in favor of that. We didn’t put that into the plan. That is more of procedural aspect than it is a plan policy or goal. We will certainly implement that as a procedure that goes along with the implementation of the plan. Commissioner Griffin: Are there any more items here under historic? Commissioner Holman: Yes. On page 20, fourth paragraph under historic preservation, item number two. The first sentence is fine then you go to the fourth line and it starts, "The evaluation would determine if a structure is a cultural resource and identify acceptable mitigation measures." I don’t follow that at all. It seems like the evaluation would determine historic eligibility. If it is historic you are not trying to mitigate changes it has to go through a review. If it is not historic then what do you have to mitigate? So I am not seeing how that second sentence applies. Do you follow what I am saying? Ms. Furth: I think in this case you have already identified the historic resources. If they are historic resources you are going to apply the Secretary of the Interior’s Standards unless the City and the owner determine that it was improperly included. So I think we could take that out. Commissioner Holman: But what you have is potential California Register eligible properties here. My thinking is this paragraph is trying to address that. So if you have a potential California Register eligible property then before you do something to it you need to find out if it is an historic resource. That is what I think this is trying to get at and that’s why I have difficulty with the second sentence and where it is trying to go. Mr. Emslie: Then if the sentence were ended at ’resource’ and then a new sentence said, "If the structure were determined to be culturally significant then the study should identify acceptable mitigation measures." Ms. Furth: I think it is even worse than that. When we first started writing this we hoped that we could have a definitive list attached that says these are the structures that have been identified as historic resources. That doesn’t mean that they have been put on eligibility lists, not that they have been actually placed on registers because they don’t need to be placed onregisters, but they are either listed on our inventory or determined by the City to be eligible for listing on the Page 47 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 Califomia or National Register. If they are any of those things then they would historic resources and then you know to treat them as such. Are you saying that the list has properties that haven’t been determined to be historic resources yet? Commissioner Holman: Correct. The National Register properties were determined. They went through a National Register properties and determined eligibility. The California eligible are potentia.1 California Register eligible. Ms. Furth: Meaning that nobody has finished the analysis so nobody knows. Commissioner Holman: Correct. So they are potential historic resources. Ms. Furth: Then we need to rewrite this to make a distinction between those identified historic resources and potential historic resources. In the case of the potential historic resources then we would have to do the analysis and depending on the outcome either move them to real historic resources or take them off. Is that right? Commissioner Holman: That is right and that’s what I think this first sentence in this paragraph does do. It talks about potential cultural resources. It is again the second sentence I am just not quite sure what is there to mitigate? If it is determined to be an historic resource then it goes through review. Ms. Grote: I think what this refers to is that we would be evaluating this in relation to a proposal so that if the proposal has some adverse impact on the resource then this study would show what the appropriate mitigation would be for that impact. It may mean a redesign. It may mean that they can’t do that particular project. It may mean many, many things but they would be evaluating what an acceptable mitigation might be for whatever impact they identify. Ms. Furth: There are two kinds of issues here. Sometimes a project won’t touch an historic resource but it will be next to an historic resource and that is I think the other place where mitigation measures are involved. We could write this more clearly to explain the standard treatment. Sometimes people view the conditions that you place on a project for consistency with the Secretary of the Interior’s Standards as mitigations. Commissioner Griffin: I am wondering, this is an area of your deep interest and expertise, is it possible to resolve the wording of this important paragraph offline or must we do it at this sitting? Ms. Furth: You could delegate that. Commissioner Holman: It is not the wording it is the intention. I am not trying to wordsmith here it is really the intention. Commissioner Griffin: I understand. Page 48 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Ms. Furth: If you focused on the policies that are policy DC 6 and 7 then we can agree that we will match the other language to the policies then I think we would be clear. Commissioner Holman: Okay, that is fine. On policy DC 13 on page 21 there is some additional language that I think the Commission also would intend to have added there. They can speak for themselves but that is what I think that the TDR is not in addition to a PC. For example in no case the TDR should be used to cause a maximum FAR to be exceeded. So the TDR could be used or the bonus could be used onsite if they can satisfy the Secretary of the Interior’s Standards but also could be transferred but not in order to allow a property within SOFA 2 to exceed the maximum FAR. I think that is what the Planning Commission had mentioned. Commissioner Packer: In the TDR section I think it makes that clear. Commissioner Holman: What page is that please? Commissioner Packer: Pages 50 and 51. Ms. Grote: I believe it is F-4 on page 51. It says, "Limitations on use of transferable development rights. No otherwise eligible receiver site shall be allowed to utilize TDR rights under this chapter to the extent such transfer would cause the site to exceed 3.0:1 FAR in the CDC sub-district, 2.0:1 in CDS or CDN and 2.0 in the RT-50 or 1.5:1 in the RT-35 District." Commissioner Holman: Thank you, that takes care of that. Ms. Grote: Great. Commissioner Packer: Commissioner Griffin: Commissioner Packer: I just want to point out on page 20 there are two policy DC-13’s. I am sorry I missed your point. Page 21, sorry. Ms. Furth: I would just comment that Bonnie provided to everybody some other errata, which we appreciate and will make those corrections. Commissioner Griffin: Sowe have consensus then on the historic item. Karen, you are loaded tonight. Commissioner Holman: So sorry. On page 42, I know there were some other things that you said we should ignore that were inadvertently added, I should say. Again on page 42, could you explain a building that is neither in historic category one or two, nor in seismic category one, two or three shall be allowed to increase its floor area by 200 square feet? Ms. Grote: This is a carryover from the Downtown district which states that for a building that doesn’t have the ability to take advantage of a bonus square footage that if they are trying to upgrade the building and they need a little bit of extra room to enlarge an elevator to meet ADA Page49 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 requirements, although that is a separate bonus a different example, some flexibility for design purposes to encourage a better looking building that that 200 square feet is a little bit of allowance to do that. But because they don’t get seismic or historic bonuses they are not eligible for either of those. Ms. Furth: This isn’t for new buildings this is for existing buildings. Ms. Grote: That is correct. This is for existing buildings. Commissioner Holman: Okay, great, thank you. Then A-2 there, this may sound like wordsmithing but again it is a meaning. The last full line in that paragraph is saying that increase in floor area shall not be given for buildings that are removed. I think the word demolition is probably what you want because of the definition of demolition. We talked about that last time at the Planning Commission. Then number three says a building that is. historic category one or two and is undergoing historic rehabilitation should be allowed to increase its floor area ratios. Why are we only giving categories one and two? Ms. Furth: To be SOFA 2 historic resources, we will confirm all that. Commissioner Holman: Maybe I can save us some time here too. If you are going to make all of this consistent then I can just skip some of these issues. Commissioner Burt: Maybe if Karen gets a chance to look it over after you revise it. Ms. Furth: We can give it to you after we redraft it so you can take a look at it. That would be very helpful. Commissioner Holman: That would be great. The Attachment F that keeps getting referenced here doesn’t exist, correct? Ms.Grote: Attachment F should be in the Attachments. Ms.Furth: It does exist. Ms.Grote: It should be in there. Ms.Furth: I saw it. Ms.Grote: All the Attachments were stapled together. Ms.Furth: It is short. Ms. Grote: It is short. Yes, it is here. It is at the very back. It is actually in the form of a memo dated August 12 fi:om Dennis Backlund to Julie Caporgno. It is in the last four pages of this big group of attachments. Page 50 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Commissioner Holman: Okay, thank you very much. Commissioner Burr: I had one quick question. We had some discussions on the properties adjacent to historic structures and a 15-foot side yard setback. There was a comment made earlier that I wondered if you cohld clarify where we stand on that right now.. Ms. Grote: Right, there had been under the very first version of the plan a special provision that called for a 15-foot setback for any site that is adjacent to an historic structure or an historic site. We removed that based on your last conversation again because the compatibility standard has been added as a requirement that that covers the need to address adjacency. So we took that other requirement out. Commissioner Griffin: I have already got consensus here with Bonnie and Phyllis and you are there Pat. And Karen? Commissioner Holman: Given I will get to see this later, yes please, thank you. Commissioner Griffin: Great. So we have finished up item number eight and we are now in the home stretch here. We are on number nine the FAR bonuses. Lisa would you take us through that please. Ms. Grote: This basically summarizes that there are bonuses allowed for seismic buildings that are in categories one, two or three. There are four of those buildings in the SOFA area and again that is at the end of your Attachments, it gives the addresses of those buildings. It says that those floor areas can be increased by 2,500 square feet or 25% of the existing building without having that increase count towards the FAR. It does say that no they do not have to park it, that such increase in floor area shall not be permitted for buildings that already exceed the FARs in the RT-35 or the RT-50. If those buildings already exceed that FAR they could transfer this square footage to an eligible receiver site. Ms. Furth: Again it is for preservation of those buildings not demolition. Right? Ms. Grote: Yes, that is correct. Ms. Furth: In other words, if you knock down the whole building you do not get this bonus and replace it with a bigger building. Ms. Grote: That’s right. If you demolish the building it is required to meet seismic standards per the building code anyway. So this is for upgrade of existing buildings only. Commissioner Packer: I have a question. This is on page 42, Section B-3, it says if the bonuses are going to be used onsite it can only be used for residential purposes, which I think is great, but I am wondering if it would be too restrictive to also require when it is transferred outside of the SOFA 2 area to also make it residential. Would that be too restrictive because there wouldn’t be that many residential districts to go to? Page 51 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32~ 33 34 35 36 37 38 39 40 41 42 43 44 45 46 1 2 Ms. Grote: That is correct. I also think there was the discussion that if it doesn’t get transferred 3 in the SOFA 2 area most of this would be transferred to the Downtown area. You don’t 4 necessarily want all of that in residential use. So there is some flexibility. I think what had been 5 determined is that it was best to make that transferred square footage eligible to whatever restrictions there are in the district that it is transferred to. Ms. Furth.: So when you look at those zoning districts in the Zoning Ordinance Update you can decide what is an appropriate use. We can give you numbers and you can decide what is appropriate. Commissioner Griffin: Karen. Commissioner Holman: I had the same question Bonnie did. I would like to know that there was some kind of way to make it feasible for or that itwas feasible actually to require the TDRs to be used for housing even in the CD District Downtown. Ms. Furth: That depends on what you decide when you look at the CD District I think. We weren’t trying to make these less marketable than CD District transfers: We were trying to make them comparably marketable. Commissioner Griffin: Bonnie, would you like to lead offunless you have more questions on this item? Commissioner Packer: Let’s go for it. Commissioner Griffin: So we have Bonnie in agreement. Phyllis? Commissioner Cassel: I think we should go with this but I want to have all of us remember how difficult this program is. We really haven’t used it very often and we have this program down in the Downtown. It is rarely used and when it is used it is usually because the owner owns both pieces of property so that he can time the transfer in the process. This is going to be very difficult to implement but we are hoping in some cases it may help. Commissioner Holman: I am fine with it too. In response to Phyllis I acknowledge what she says and also as I think as I have said before too I think the likelihood of this being for historic or for seismic it is going to be a lot more successful ifPCs are a lot more restrictive as we are proposing. Hopefully we will be proposing to redo the PC aspect of the ZOU. Commissioner Griffin: So that takes us through nine: We have consensus on that. If we could do ten now. Ms. Grote: Actually I think because we did talk about the TDR it seems like there is consensus on that as well. Page 52 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 2o 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 Commissioner Griffin: I agree. I just wanted to make sure that was the case. Yes, Bonnie, questions? Commissioner Packer: I have a question on the concept of TDRs. I would be afraid that you have a large site and it has all this development potential and they transfer it all out and then the site is left vacant or is just not developed very well. So I was wondering if we could have .language to say two things. Supposing you have a large site and one little comer has an historic place on it. Wouldn’t you want to limit the development rights just to the parcel that underlies the historic or seismic building that this affects? Ms. Grote: The only square footage that is transferable is the bonus square footage. So they would be able to develop either the 1.15 or 1.5 depending on the district that they are in and then transfer off the rest of the bonus square footage. So they wouldn’t be transferring all of their developable square footage it is only the bonus square footage. Commissioner Holman: The other aspect of that is you do have to satisfy the Secretary of the Interior’s Standards and if they can’t use it all onsite because they can’t satisfy the Secretary of the Interior’s Standards then say if you have a small house on a somewhat larger lot, there aren’t that many big lots here, it leaves some open space which also adds to the eclectic nature of the neighborhood so I think you are accomplishing by allowing this what the area is now. Commissioner Griffin: Are there any more comments? Commissioner Packer: In reading the material on page 50 and 51 I just didn’t read it to say that it was only transferring the bonus. So I know it says it in the section on the bonuses but the Transfer of Development Rights, when I read this section, it seemed to me that if you are one of these kinds of buildings, seismic category in the historic, and you want to do something you could transfer your development fights there. In other words if you are an historic site in the RT- 35 Zone and you have an FAR potential of the 1.15 but you are just a little building and you are going to upgrade it then you could transfer everything on top to somewhere else. Ms. Furth: Well you can’t, in fact. So maybe we didn’t pick up the definition of transferable development rights properly from the existing chapter. But the only part that can be moved is the bonus, not the base density on the property. So if we didn’t make that clear we will take a look at it again and appreciate the thought. Commissioner Griffin: Karen are you having some errata items that you would like to add here? No? Okay. So we are in agreement with this item number ten then? And we will shortly be in agreement with number eleven. Thank you for your encouragement. Ms. Grote: Number eleven is that the existing alleyways be retained and preserved for commercial use. We did add the policy in the transportation section of the policies and programs for that. Page 53 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 Commissioner Griffin: Are there any questions on this one or do we have consensus? Karen. Commissioner Holman: I am fine with it thank you. Commissioner Burr: Me too. Commissioner Griffin:. What a team. So we will finish with eleven and we have previously taken care of twelve, if I understand it correctly. Bonnie, you have a questioning look on your face. Commissioner Packer: I submitted my little list of items and some of them were typos but not all of them. I wanted to know how the Commissioners felt about any of those if you had a chance to look at it. I don’t want to be one-upping the rest of the Commissioners with some of my comments. Commissioner Griffin: I thought it was an expeditious way of presenting some small but important items so that Staffhad a chance to look at them and move on those ~hat could be accomplished without a great deal of strain. Ms. Furth: Your second item the page two item about the revised zoning and Staff did want to respond to you on that. Mr. Emslie: We would recommend that we stay with the definitions and they are currently defined. As you go through the zoning code you will be asked to go through each of the zones and determine if there are policy implications for those. Zones that we will include will be the SOFA 2 zones. So we will go through that exercise of redefining them and be going zone by zone to see if it applies and if you want to make any changes specific to that. zone. So that will get exercised in the zoning code update. That will include SOFA 2, SOFA 1 and every other zone district in the City. Ms. Furth: So as I would say it the reference is going to be the definitions and procedures in Title 18 as it is amended from time to time. So when you amendit one of the checks we will do is do you want that to apply to SOFA 1 and SOFA 2 and if you don’t we will fix it. In ten we will also write that those appendixes are stuck on here so that people can see more easily what they are talking about and we will substitute updated ones as necessary. Commissioner Cassel: I had a series of small things from reading the text. Many of my questions have been answered as we have gone along but in previous meetings I asked some questions we didn’t have time to discuss them. I wanted to know if you had some answers to do with some of these. There is some wording in this text that I have a little problem with. The way it is worded for instance in crosswalks, in order for any changes to be made in the crosswalks we had to come to the City for comment. Well, no private developer is going to be changing the crosswalks I hope. I am not sure why it has to be in here. Page 54 1 Ms. Grote: Actually, crosswalks do get changed occasionally with private development 2 depending on access to the site, depending on better circulation as part of a transportation study 3 or analysis. So it is conceivable that they would be changing crosswalks in conjunction with 4 other site development. So yes, we would want them to be looking at these public improvement 5 guidelines so that they would know what we are expecting should that be part of their proposal 6 or should we require it to be part of their proposal. It may not happen often but it does happen. 7 8 9 11 12 13 14 15 16 17 18 19 2O 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 46 Commissioner Cassel: There is just so much in here that I find it hard to keep track of it one way or the other. So I was just trying to think of ways that are simpler. I talked about the pedestrian furniture. Ms. Furth: What page are you on? Commissioner Cassel: In this case I am on page 27. My question really is and this goes to a couple of other and I think you somewhat answered offline the question on the art that in fact because every building here is reviewed by ARB, any public art would have to be reviewed by the ARB. Ms. Grote: If public art is proposed as part of a development it would be reviewed by either the ARB or the Joint ARB/HRB and that would then be referred to the Public Arts Commission. That is typically what happens now. So yes there would be a public review of that art piece as long as it is visible fi:om the public right-of-way. If it is inside a building we wouldn’t do that. If it is outside then yes, it gets referred to the Public Arts Commission for review. Ms. Furth: This is public art in the public right-of-way in this section here. So this is a very aggressive guideline. Commissioner Cassel: I guess I am looking at a development that is being built as of right as saying you have all these requirements for street furniture and so forth. I guess I am kind of looking at these are process questions. How do they get enforced? How much enforcement can we have? Do we have a consistent pattern that we tell them we want a consistent pattern of furniture throughout the region? How do we do that? Ms: Grote.: Some of this is, and we briefly talked about this last time, some of it can be included in an urban design plan, which would be a follow up action to this or a follow up plan. This is not intended to be the urban design plan. This is intended to say that should you have public improvements incorporated into your project these are some general areas to look at, these are some general things to consider. We can follow it up with much more specificity in an urban design plan. We wouldn’t recommend including it in here at this point but there is certainly enough for follow up action. Commissioner Cassel: Was there any intent of doing an urban design plan in this area? I am thinking of funding and how much time it has taken to do these elsewhere. Ms. Grote: It is something that would go on to a work program for us and for Public Works. Page 55 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 Commissioner Cassel: I guess I am concerned about demanding something that meets a guideline that we don’t have or we aren’t intending to have. So I am just concerned about that. Ms. Grote: I don’t think we are demanding it we are encouraging it. Since we encourage it we say here are some things to consider since we are encouraging you to think about it and to provide these things here are some guidelines to apply but we are not demanding it. Ms. Furth: I also think a lot of this has to be read as instructions to the City as to how to manage its own property. It may be some time before the City gets around to doing anything about the street lighting there or City street furniture but true street furniture that is on the sidewalk that is the real sidewalk not the apparent sidewalk that is actually behind the setback line that is owned and operated and selected and picked by the City. So a lot of this I think is sort of read as directive to Public Works and community services. Commissioner Packer: This is a follow up to Phyllis’s concern. I raise this in my list. On page 28 it says developers should provide street trees. Was that going to be softened? Looking through this and where it says this should be done at developers expense even though the developer is doing a little as of right thing. Ms. Grote: We currently require street trees when anybody comes in as of right or with anything else. So street trees are required as are public improvements if a sidewalk is damaged or is in need of repair the applicant is required to do that and repair any curb gutter damage. Ms. Furth: Make them remove curb cuts if a driveway is eliminated then the sidewalk has to be restored. Commissioner Packer: Thank you. Commissioner Griffin: Karen. Commissioner Holman: I have onethat Bonnie brings up on page 24. Your suggestion Bonnie, that it be titled simply Design Guidelines, it can’t be both a guideline and a requirement. The compatibility requirements are requirements and that was very clear. Then if you go over to design guidelines for private property especially a lot of those items that are addressed there would be requirements that would be dictated by the compatibility requirements. So it seems confusing to me that someone coming in with a project would say that i found it here in the guidelines but actually it is a requirement for compatibility. So I think that is really confusing. Ms. Grote: Would it be clearer if Chapter Four were entitled Compatibility Requirements and Design Guidelines because the compatibility is a requirement? Commissioner Holman: Compatibility is a requirement but some of the things mentioned that satisfy compatibility are then given later as design guidelines. Ms. Furth: The reason they are guidelines and not development standards is because what we put in Chapter Five is stuff that a building inspector can figure out. Basically you measure how Page 56 1 2 3 4 5 6 7 8 9 10. 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 far it is setback, you look at these various lines. Those are quite quantitative criteria. The guidelines in Chapter Four tell the ARBiHRB what to evaluate a project against when they are doing design review. That is why they are guidelines. Commissioner Holman: I understand. Maybe ifI read this again and you guys read it again too you will see where I am coming up against the conflict between the compatibility standards or requirements and the design guidelines. Ms. Grote: I think when we were talking about this in the Working Group one of the things that Dennis had mentioned is that there are often times many different ways to address some of these issues, the siting, scale, massing, materials. That there are a lot of different ways to approach it and that it was kind of a perception almost, how someone perceives a building, how someone experiences a building, isn’t necessarily written into a strict development standard. There are lots of different ways to do it. So these design ideas, these design guidelines were ways to try and implement or ways that could implement the compatibility requirement so that it left some creativity in the process so that one project may not meet this compatibility requirement in the same way as the project down the street. Ms. Furth: We did try to resort them and to put the ones that were mandatory in one chapter and the ones that weren’t in the other. Obviously we didn’t do enough to be clear. It says for example that driveways should be a minimum of five feet back from the property line. It is a guideline there because there may be circumstances in which that doesn’t make any sense such as if it needs to beat the edge. It says the fences should be good looking. I am sure we have still missed some and it would be helpful to know what things you feel should not be guidelines. Commissioner Holman: Maybe it is how it is presented. I will give you one example. On page 29 under B-1 it says main entrances to buildings are encouraged with direct visibility from the street, a clear entry path, etc. While in the compatibility standards one of the things that you will find is that there are frequent entryways in here. So if what you are trying to accomplish Ms. Furth: I’m sorry, what is in the compatibility standard? Ms. Grote: I think it says if the new design has taken careful account of the following characteristics and then number five is the location and treatment of entryways. So I don’t think it tries to say that the entryways have to be specifically every so many feet. It says that they should be reflective of a pattern that is out there or compatible with a pattern that is out there. That would then relate to this in that it says should there be clear entries on other projects that yes, thdt is what you would want to consider when you are trying to make your project compatible with somebody else’s project. If there is a pattern of clear entryways then you would incorporate that into your design. Ms. Furth: We are also assuming that what you do on Alma might be very different from what you do on a street that doesn’t have that kind of volume, and noise. Commissioner Holman: Of course, I am not trying to say these are development standards. I can see the rest of the Commissioners are yawning. I will read this again certainly but I think Page 57 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3O 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 what might make me more comfortable or understand this better is if these are given as possible ways of accomplishing compatibility. Mr. Emslie: Would this be one of the items that the Commission would be willing to delegate to Commissioner Holman to deal with Staff? It seems like we have the sense that the general policy direction is correct it is more of a sorting of which are requirements and which are not and then maybe a qualitative look through that we need to do to follow up on that. Commissioner Griffin: Please. Commissioner Cassel: I think you maybe should have more than one person do that. I am not sure it needs to be decided who does that tonight but I think it should be more than one person that looks at that. Commissioner Holman: Do you want to do it with me, Phyllis? Commissioner Griffin: Are you volunteering? Commissioner Cassel: Not yet. Commissioner Griffin: We can forever here. Commissioner Cassel: Besides the fact that I think we need to make a motion there was a question on one of the 1,500 square foot maximums on units. It dawned on me that does that 1,500 maximum mean the unit itself or does that mean you take your whole FAR and divide it into the units? Ms. Grote: It is the unit itself. Commissioner Cassel: I just wanted to make sure that it was clear. MOTION I am ready to make a motion that we recommend the Staff Report to move this forward with our recommendations to City Council along with the SOFA 2 Phase 2 plan and our comments from these meetings and the minutes from these meetings. SECOND Commissioner Packer: Second. Commissioner Griffin: We have moved and seconded. Do you have any comments on your motion? Commissioner Cassel: I have a few, very brief and general. This has been very hard to do. It has been a lot more complicated than we thought it would be and I am hoping that what we have Page 58 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 leamed from this will somewhat lead into some work we are doing the Zoning Ordinance. I think if we are going to do more of these we are going to have to make this process move a little smoother and a little faster in order to make that work whether this will help us do that the next time around or not I don’t know. I did read the vision statement to see if increasing the intensity of the zones along Alma whether we still met that vision statement that was read in this document and I feel it does and I think that was very important. So I am glad we did increase the density to the R-50 in those areas where we did that and that we increased it to 115 where we did that to allow the PC zones. I hope that will work to encourage the housing that we want. Commissioner Griffin: The seconder has no comments. Did you wish to speak? Commissioner Packer: In addition I want to thank the Working Group for their vision, for their hard work and we made some changes some maybe are substantial from what the Working Group wanted in certain areas but the basic ideas, the basic sense of that neighborhood is so well done in the vision and in the policy statements. I think that is what really drove where we went. Again, I just want to thank the Working Group for all the hard work they put into it and the Staff, of course. Commissioner Griffin: Indeed it was a valiant effort and we can’t hope to have pleased everyone but this was a complicated process and vastly more so than I think we anticipated but we are through it. Karen, would you like to wrap it up? Commissioner Holman: Bear with me here I just have two or three more comments and I apologize for that and I will make them really brief. The existing larger projects do address something I brought up previously, which is that if those projects were redeveloped that they wouldn’t result in fewer housing units. I think that is a policy that ought to apply to all projects and not just the larger already developed projects. Would the Commission agree with that? Commissioner Cassel: I think I have brought it to ~ motion so we would not go through a lot more discussion at this point. Commissioner Holman: Okay, I will just make these comments then. That would be one thing that I would want to see Staff consider. Also as I mentioned before I don’t want to see housing replace the non-office commercial because it is an eclectic area and should retain that character. I will just leave it at that at this point. Commissioner Burt: I would just like to add that I think that the changes that the Commission has made from the Working Group policy, the most substantive changes have to do with transit oriented development, density where the Commission has actually selected a density that is at the low end of what the ComprehensiVe Plan had stipulated and would only occur within the parameters Of a strictly defined PC with far more public benefits than has historically been the case in the community. So I think that the Commission’s primary distinctions from the Working Group’s are ones that are more consistent with the Comprehensive Plan than what the Working Group had proposed. As having participated in the Working Group I think the discussion oftb.e Comprehensive Plan consistency really wasn’t a maj or part of what was the dialogue of the Working Group and that the Commission with its responsibility to the Comp Plan I think is more Page 59 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 sensitive to those issues and looks at these broad issues in a slightly different way. I think it is an excellent plan. I think the vision that came out of the Working Group is very good and I think that the Commission has done an excellent job of its recommendations. Commissioner Griffin: Lisa. Ms. Grote: .Thank you. I also wanted to thank Jon Abendschein who is in the audience and introduce you to him. He is the one who put this into its format and took all of the changes and the recommendations and really tried to synthesize them and put them together and make them coherent. So I really, really want to thank him as well as everybody else. Commissioner Griffin: Herculean effort. Ms. Furth: Jon is a demonstration of the fact that being an engineering graduate does not prevent ¯ you from being both a good planner and a good lawyer. Commissioner Holman: I would be remiss ifI didn’t also thank the Working Group for all of their efforts. It has been a very, very long process and people have hung in there through disagreements and contentious issues and gaps in getting together. So I think they are to be commended absolutely. Also to thank Staff and as they have seen people come and go and other Staff come and go you have had to fill in and plug in and catch up and your efforts are very much appreciated. So hopefully we are just about through with this. MOTION PASSED Commissioner Griffin: All in favor of the motion? (ayes) Opposed? That carries unanimously. We are now through that portion of our agenda. Page 60 Betten, Zariah From: Sent: To: Subject: Attachment q Joy Ogawa [jmogawa@juno.com] Wednesday, August 07, 2002 3:38 AM Planning_Commission@city.palo-alto.ca.us SoFA II - (Ground Floor Retail Conversion Ordinance won’t apply) Dear Planning and Transportation Commissioners, Near the end of the July 31, 2002 meeting discussion of the SoFA II Plan, Commissioner Holman expressed concern about losing existing neighborhood-serving retail and personal services. Chairman Burt then asked staff whether the Plan could specify that the level of existing retail be retained in any redevelopment. Senior Assistant City Attorney Wynne Furth responded, "We have done that -- I’ll leave it to the planners whether that’s a good idea -- that’s what we have done in the retail conversion ordinance. You can redevelop the project, but you can’t reduce the amount of space devoted to retail." I believe that Senior Assistant City Attorney Furth’s comments were not ’ entirely accurate. While the so-called Ground Floor Retail Ordinance does prevent conversion of existing ground floor retail, personal services, auto services and residential uses from conversion to medical, professional or general business office within Neighborhood Commercial (CN), Service Commercial (CS) and Community Commercial (CC) districts, it DOES NOT PREVENT CONVERSION OF EXISTING GROUND FLOOR RETAIL, etc. to RESIDENTIAL. Commissioner Holman specifically expressed concern atyout loss of existing neighborhood-serving retail to residential development, given strong incentives to build residential (and I presume the current economic climate). The current Ground Floor Retail Ordinance does not address that. In addition, I point out that the Ground Floor Retail Ordinance DOES NOT APPLY to areas covered by a Coordinated Area Plan (CAP). Therefore, while the Ground Floor Retail Ordinance currently applies to the properties within the SoFA II area because the), are currently zoned CC or CS or CN, once the SoFA H Plan goes into effect, the Ground Floor Retail Ordinance will no longer apply! Therefore, unless specific provisions are made ~vithin the SoFA II CAP to preserve exiting retail, such retail will be vulnerable to conversion to other uses. I certainly hope that under the SoFA II CAP, the existing retail within the SoFA II area will be afforded, at the ve~y least, the same level of protection that they currently are given under the Ground Floor Retail provisions of existing commercial zoning. Sincerely, Joy Oga~va " Betten, Zariah From: Sent: To: Subject: Bobgmoss@aol.com Sunday, May 12, 2002 9:25 PM plandiv_info@city, palo-alto.ca, us SOFA 2 Plan ! have been following the progress of the SOFA 2 plan with interest. The ’ latest twist is the claim by developers that the proposed restrictions and FAR limits won’t allow development because it will pinch profits, i say "kY2ay to go!!" Pinched profits are the best possible result when the alternatives are violations of sound land use, bad planning, overdeveiopment of property, excessive traffic, height, bulk, and parking requirements, and failure to adopt a plan that has been worked on and agreed to by residents and other major stakeholders. Please be advised that it is not the function of the Planning Commission, Planning Staff or City Council to assure any developer a profit, or even a break-even situation. Your primary function is and must remain to assure that the citizens of Palo Alto, our community at large, and other public agencies such as PAUSD are protected from excessive demands on services, maintain a livable community with appropriate scale and compatibility, and have consistently applied land use and development standards. As you know PC zoning is widely abused, the terms and conditions of the PC are often violated, and enforcement of a PC is almost unheard of. ~’Uith all these negative features, it is absurd to approve a PC in SOFA 2, and irresponsible to approve a PC just because a developer whines that without the PC they won’t make money. Tough. if they don’t like the terms and conditions of the SOFA 2 zoning and land use requirements including the FAR limits, they are perfectly free to leave town and never appear here again. ~V~/e can tolerate the loss. in fact, if they agree to go far far away and take ¯ their awful proposal with them I’!1 even pay their bus fare. Do the right thing. Prohibit any PCs in SOFA, retain the FAR limits, and reject the requests for any relaxation in the rules adopted by the SOFA committee and supported by the residents. It is far more important to do it right than to do it fast. Bob Moss 4010 Orme &me 19, 2002 Memo to Steven Ems]ie, Director of Planning Lisa Grote, Chief Planning Official From: Elaine Meyer, President, University South Neighborhoods Gro~rp and SOFA 2 Working Group member Re SOFA 2 reports and deliberations We are painfully aware of the deviations from the pubiic process that t~ok place in SOFA 1 and wish to point out a nmnber of events that appear, at least, very troubling ca~ SOFA 2. With a v~ew to safeguarding the validity of the SOFA2 process to which so much time and energy has been devoted, we are aware of a number of improprieties or appearances of such, that have taken place crcer the last few months. They are as follows: o A member of the WorMng Group was allowed a 1 3/4 hour talk detailing his objections (in a proforma) to the derisions of the Working Group. This took place at the final meeting of the WG (no documents distributed). This was our deadline meeting and we had many items to complete. The use of so much time for this presentation, which we were not prepared to disoass, let alone believe, seemed extremely inappropriate. o This same unvetted proforma containing a document labelled ANALYSIS OF SOFA II PLAN, with eight spreadsheets, 9 pages of text, and 2 additional Exhibits, was attached as Attachment K of the Staff Report to the May 8th Planning Commission. Any reader would reasonably assume that this was a Platming Department-approved analysis. o A Consent itemwas placed on the Agenda of the City Council (in April?) to give the 800 High Street project a prelirainal~ hearing. This project falls right in the middle of SOFA 2. The Coundl quite properly refused to hear the item until SOFA2 was Completed. Despite this action of the Council ~ The 800 High Street Project remained on the June 12 PTC agenda. It was removed only a few days ago, on June 5th. o "NGA PLANNI COMMISSION RECOMMENDATIONS" map presented by staff at PTC meeting on June 5th. The PTC has not made any recommendations, they have only had early discussions. How did this map come to be produced and distributed and posted on the wall when no recommendations have been made, nor will they be made until the PTC meets on June 27th. o In the May 8, 2002 Planning Division’s Staff Report The Staffs map is labelled Staff £tECOMMENDATIONS. The imaginary Plarming Cummission map is labelled Planning Commission RECOMMENDATIONS The Working Group’s map is labelled Worldng group PLAN CONCEPT Why is the Working Group’s many-meeting years-long compromise denigrated to a ~Concept’~ ®The Working Group report and the May 8 Staff Report emphasize the split vote regarding PCs and not for other issues where there atso was no This vote should not be challenged any more than other votes. All split votes should be reported, or none.Since the staff recommendations stand on their own, the appearance is created that the Department disapproves of the outcome of this vote. July 25, 2002 Ms. Lisa Grote Chief Planning Official City of Palo Alto 250 Hamilton Avenue Palo Alto, CA 94303 SEDWAY GROUP I Real Estate and Urban Economics 505 Montgomery Street Suite 600 San Francisco, CA 94111-2552 T 415 781 8900 F 415781 8118 sedway@sedway.corn Re: Draft Economic Analysis for South of Forest Area Phase II by Bay Area Economics Dear Ms. Grote: Sedway Group has performed a preliminary review of the Draft Economic Analysis for the South of Forest Area Phase Ii (SOFA II) prepared by Bay Area Economics (BAE), as well as the development prototypes by Freedman, Tung & Bottomly (FTB). This review focused solely on the residential component of the BAE draft report. Overall, we admire the amount of detail included in the analysis, especially considering what we understand was a relatively limited period of time al!owed for its preparation. However, Sedway Group has some questions and concerns regarding the analysis and would like to provide its input before the analysis is finalized. Please note that Sedway Group focused its efforts on the larger development site (26,250square feet) and the most dense development scenario (maximum 2.5:1 floor area ratio - FAR). Thus, certain of the following items pertain solely to these development scenarios (both with high and low parking requirements, BAE Appendices Q and R). However, a number of the questions and concerns may be relevant to the other development alternatives. As illustrated later in this letter, by adjusting the residual land analysis presented in Appendix Q by many of these factors, redevelopment to residential at lower densities is not feasible. PRODUCT DESIGN AND HARD COST ISSUES With respect to the large site "High Intensity" (2.5:1 FAR, Appendices Q and R) scenarios, Sedway Group has three questions regarding design, which impacts the estimated hard construction costs: 1)The current design includes podium spaces, which are discouraged by the SOFA II plan design guidelines, and alley-accessed surface spaces. As parking constrains the density of development, was a two-level garage considered? Although a larger garage is certainly more expensive to build than a combination of underground, surface, and podium spaces, more residential units can likely be constructed. The current scenarios represented as a 2.5:1 FAR density reflect only a 1.47:1 FAR with standard parking (BAE Appendix Q) and a 2.03:1 FAR with reduced parking (BAE Appendix R). It would be. interesting to test the development feasibility of an alternative that maximizes density. 2)A review of the FTB designs show stacked flats on four levels (including ground level). These units appear to be accessed by interior and/or efterior double-loaded corridors. However, the amount devoted to circulation is only 4.0 percent. Based on Sedway Group’s experience with other non-townhouse multifamily residential projects, "load" or circulation factors range from a CB Richard Ellis Company Ms. Lisa Grote City of Palo Alto "July 25, 2002 Page 2 SEDWAY GROUP ]Real Estate and Urban Economics 10.0 to 20.0 percent. It would be helpful to see FTB’s calculations of the net and gross residential square footages for both the High Intensity (2.5:1 FAR) and "Staff Recommended" (1.5:1 FAR) development prototypes. 3)The designs for the large site High Intensity alternatives, as well as the large site Staff Recommended and small site High Intensity prototypes, appear to include one or more elevators. However, the hard costs appear to generally not include an elevator (see Appendix S of the BAE report), with the exception of the large site High Intensity, low park, scenario (Appendix R). Clarification is needed as to which development alternatives include elevators and how the elevators impact hard costs. SOFT COST ISSUES In general, Sedway Group found the soft costs outlined in the residual land value analyses in Appendices E through R very detailed and overall reasonable. Due to the depth of detail presented with regard to the impact and planning fees in Appendix T of the BAE report, Sedway Group did not specifically investigate and cross-check the figures. However, Sedway Group did notice the omission of certain soft cost line items that are typically included in residual land value analyses and development pro formas. The missing soft costs include the following: *Property taxes during project construction and unit sell-out (a carrying cost); o Homeowners’ Association dues during unit sell-out (a carrying cost); *Developer’s overhead and administration (often 1.5 to 3.0 percent of hard costs); -Legal, accounting, and Department of Real Estate costs; and *Marketing expenses (e.g., on-site sales office, unit models, promotional materials, advertising, etc.). In addition to these items, Sedway Group believes that the developer’s incentive is too low. Currently, this incentive is modeled as a 12.0 percent profit on hard and soft costs, excluding financing costs. ¯ There are two interrelated issues, on the developer incentive: Developer Equity Interest Carry Appendix Q of the BAE report details the residual land value analysis under the large site High Intensity standard parking scenario. The following illustratds the breakdown of total construction costs, as presented, and the construction loan: Total construction costs before profit: Construction loan amount: Developer equity: $9,699,103 -$6,477,642 $3,221,461 Therefore, the developer must come up with $3.2 million in order to build the project. Often, the developer will take on an equity partner in order to obtain at least a portion of this money. In other cases, the developer will secure "mezzanine financing" (somewhat similar to a second loan) to help bridge the gap. The remaining amount will come from the developer itself; however, this money is being diverted from other competing investments or development projects. In other words, the $3.2 Ms. Lisa Grote City of Palo Alto July 25, 2002 Page 3 SEDWAY GROUP I Real Estate and Urban Economics million is not_free. Whether the developer uses its own money or third party money, there is at least an implicit cost associated with this money. For example, in extensive residential financial feasibility analyses recently prepared on behalf of a private developer in conjunction with the City and County of San Francisco Planning Department, Sedway Group included a 10.0 percent annual cost for interest carry on the developer’s equity. Developer Profit When underwriting a construction loan, lenders will review the development pro forma to identify the developer’s profit margin. If a certain threshold profit is not reached, then a construction loan will not be made. From a lender’s point a view, a sufficient level of profit is required to prevent default resulting from either: 1) an increase in development costs; and/or 2) a decrease in the potential unit sales prices. Based upon prior work conducted by Sedway Group, a minimum profit margin of !5.0 percent, applied to all hard and soft costs, is often required by lenders, in the above-referenced analysis, Sedway Group used an 18.0 percent profit margin based on total development cost. REVENUE ITEM With regard to the revenue potentiid category of the residual land value analyses, Sedway Group found that 10.0 percent of the units were assumed sold as below market rate (BMR) units. Based upon a review of the City ofPalo Alto’s Draft Housing Element, Sedway Group understands that the BMR requirement will likely be increased to 15.0 percent. Thus, the residual land value analyses should probably include this higher BMR rate. RESIDUAL LAND VALUE ANALYSIS IMPACTS Although Sedway Group has had limited time in which to review and analyze the BAE report and FTB drawings, an attempt was made to quantify the impacts of the above-noted items. The residual land value analysis presented in Appendix Q of the BAE report was used as a basis for this quantification. Sedway Group did not alter most of the inputs and assumptions used by BAE. However, if a certain line change "flowed through" the analysis, Sedway Group made the appropriate calculations based on BAE’s parameters. The table presented on the following page summarizes the impacts of certain items as presented in Appendix Q: Ms. Lisa Grote City of Palo Alto July 25, 2002 Page 4 S IZ DWAY GROUP I Real Estate and Urban Economics, Impact of Potential Changes to BAE Appendix Q Item Result BAE Appendix Q Increase circulation from Lose 1 unit (19 units 4% to 10% (1)instead of 20) Sedway Group Difference Increase BMR from 10%3 units sold at reduced to 15%price instead of 2 units Cumulative Impact Additional soft costs (legal,acct.,DRE, marketing, HOA dues, property taxes) Lower Revenues $16,527,862 $15,271,605 -$1,256,257 Increase Soft Costs $0 $311,188 $311,118 Developer Overhead (3% of hard and soft costs)Increase Soft Costs $0 $286,748 $286,748 Developer Equity Interest Carry (10% per year)Increase Soft Costs $0 $605,680 $605,680 Increase Developer Profit to 15%Increase Developer Profit $1,091,846 $1,641,442 $549,596 $10,790,949 $12,584,388 $1,793,439Cumulative Impact Increase Total Costs Indicated Residual Land Value and Value per $5,736,914 $2,687,217 -$3,049,697 Square Foot $219/SF $102/SF (2) -$116/SF (1) If circulation were factored at 15 percent, then development potential is reduced to 18 units, which reduces revenues. (2) If all parking were placed underground in acdordance to the SOFA II design guidelines, total development costs would increase by $1.1 million and the residual land value would decrease to $1.57 million or $60 per square foot of land area. Based upon the above table, the items noted in this letter have potentially substantial impacts on ..... residual land value, and thus feasibility (or the financial incentive to redevelop). While the above table pertains to the program outlined in Appendix Q (at an actual density of 1.47:1 FAR), the potential changes are pertinent to other development scenarios, which suggests that lower-density developments are, in fact, not feasible. I hope that the points raised in this letter are a helpful addition to the discussion pertaining to the economic feasibility of the policies under consideration. Sincerely, Mary A. Smitheram-Sheldon Managing Director HA2002 Projects~ 1402 RossLSOFA 2 Workshop Input Letter.doc PREMIER PROPERTIES MANAGEMENT June 25,2002 VIA HAND DELIVERY Ms. Lisa Grote. Planning Department City of Palo Alto 250 Hamilton Avenue, 5th Floor Palo Alto, California 94301 Re: June 26th SOFA II Planning Commission Hearing Dear Lisa: I know how hard you and all the members of Planning Staff work, with too much grief and not the gratitude you deserve. I am sorry to join the grief brigade for this Week. I was surprised to learn that there is a Feasibility Report and a Public Hearing of the Plato-ring Commission being conducted this Wednesday, June 26aL I did not receive a notice, and neither did many of the owners of property in Sofa II - including members of the SOFA II Working Group such as Tom Harrison and Chop Keenan. For me, this is also troublesome because, as you know based on a May 4 meeting among Steve Pierce, Steve Eimslee and Amy Herman of the Sedway Group, and me, a group of us are funding a detailed financial analysis of retail matters for SOFA II, with that report well under way. I am unable to attend this week (I only learned of the June 26th Plaruaing Commission Meeting during a telephone conversation with Adam Quirm of Bay Area Economic Analysis - the City’s consultant). Adam was unable to come to Palo Alto to meet me or other owners in SOFA II and the Downtown, both because his budget did not permit a trip to tour the SOFA II area and because of time pressures to meet the report deadline. Other SOFA II owners report a similar frustration. In October 2001, Premier Properties prepared a detailed analysis of ground floor vacancies in the greater Downtown area, and identified 59 vacancies. We updated this report last week and identify 77 vacancies. Some ground floor spaces, such as the Fasani Carpets building at Alma and Hamilton, 150-158 Hamilton and 701 Emerson have accepted short-term, very low rent users while they finalize plans for building renovations, which have been in the planning process. These do not represent leases with viable tenants for SOFA tI. 172 University Avenue, Palo Alto, California 94301 .:. 650 325-7787 Fax: 650 325-4364 Ms, Lisa Grote June 25, 2002 Page Two We trust that there will be an opportunity for the Sedway Group analysis to be presented and analyzed. More importantly, we request that Planning Staff schedule meetings with sufficient advance notice so that the several dozen owners of properties within SOFA II have an opportunity to participate. Please provide this letter to the Planning Commission in advance of the June 26th hearing. Sincerely yours, s E. Baer cc: Chop Keenan June 2002 Ground Floor Vacancies Downtown Palo Alto For the purpose of this study, Downtown Palo Alto is defined as the area bordered by Hawthorne Avenue to the North, Addison Avenue to the South, Alma Street to the West, and Middlefield Road to the East) 1. 235 Alma Street 2. 291 Alma Street 3. 525 Alma Street 4. 539 Alma Street 5. 600 Block Alma Street (A) 6. 600 Block Alma Street (B) 7. 917 Alma Street 8. 955 Alma Street 9. 999 Alma Street 10.335 Bryant Street 11. 518 Bryant Street 12.522 Bryant Street 13.540 Bryant Street 14.737 Bryant Street 15.508 Emerson Street 16.540 17.611 18.701 19.723 20.745 21.825 22.163 23.420 24.203 25.221 26.227 27.100 28.100 29.116 30.122 31. 177 32.210 33.240 34.248 35.459 36.505 37.120 38.444 Emerson Street Emerson Street Emerson Street Emerson Street Emerson Street Emerson Street Everett Avenue Florence Street Forest Avenue Forest Avenue Forest Avenue Block Hamilton Avenue Hamilton Avenue Hamilton Avenue Hamilton Avenue Hamilton Avenue Hamilton Avenue Hamilton Avenue Hamilton Avenue Hamilton Avenue Hamilton Avenue Hawthorne Street High Street 39.575 40.654 41. 790 42.831 43:849 44.200 45.214 46.230 47.232 48.250 49.26O 50.270 51. 300 52.433 53.127 54.130 55.131 56.181 57.255 58.325 59.493 60.700 61. 735 62.819 63.820 64. 101 65.116 High Street High Street High Street High Street High Street Homer Avenue Homer Avenue Homer Avenue Homer Avenue Homer Avenue Homer Avenue Homer Avenue Block Homer Avenue Kipling Street Lytton Avenue Lytton Avenue Lytton Avenue Lytton Avenue Lytton Avenue Lytton Avenue Lytton Avenue Block Ramona Street Ramona Street Ramona Street Ramona Street University Avenue University Avenue 66.174 University Avenue 67.220B University Avenue 68.227 University Avenue 69.235 University Avenue 70.335 University Avenue 71.367 University Avenue 72.477 University Avenue 73.516 University Avenue 74.525 University Avenue 75.530 University Avenue 76.567-581 University Avenue 77.720 University Avenue October 2001 Ground Floor Vacancies Downtown Palo Alto For the purpose of this study, Downtown Palo Alto is defined as the area bordered by Hawthorne Avenue to the North, Addison Avenue to the South, Alma Street to the West, and Middlefield Road to the East) 1. 539 Alma Street 2. 600 Block Alma Street (A) 3. 600 Block Alma Street (B) 4. 955 Alma Street 5. 999 Alma Street 6. 516 Bryant Street 7. 518 Bryant Street 8. 522 Bryant Street 9. 737 Bryant Street 10.701 Emerson Street 11. 723 Emerson Street 12.730 Emerson Street 13.732 Emerson Street 14.818 Emerson Street 15.825 Emerson Street 16.163 Everett Avenue 17.100 Block Hamilton Avenue 18.100 Hamilton Avenue 19.116 Hamilton Avenue 20.132 Hamilton Avenue 21. 136 Hamilton Avenue 22.156 Hamilton Avenue 23.156B Hamilton Avenue 24.177 Hamilton Avenue 25.210 26.221 27.227 28.240 29.439 30.459 31.444 32.575 33.200 34.250 35.260 36.270 37.300 38.433 Hamilton Avenue Forest Avenue Forest Avenue Hamilton Avenue Hamilton Avenue Hamilton Avenue High Street High Street Homer Avenue Homer Avenue Homer Avenue Homer Avenue Block Homer Avenue Kipling Avenue 39.127 40.130 41.325 42.700 43.735 44.819 45.820 46.101 47.151 48.165 49.174 50.180 Lytton Avenue Lytton Avenue Lytton Avenue Block Ramona Street Ramona Street Ramona Street Ramona Street University Avenue University Avenue University Avenue University Avenue University Avenue 51. 185 University Avenue 52.220A University Avenue 53.220B University Avenue 54.227 University Avenue 55.235 University Avenue 56.335 University Avenue 57.447 University Avenue 58.475 University Avenue 59.540 University Avenue Ground Floor Vacancies Downtown Palo Alto For the purpose of this study, Downtown Palo Alto is defined as the area bordered by Hawthorne Avenue to the North, Addison Avenue to the South, Alma Street to the West, and Middlefield Road to the East) 1. 235 Alma Street 2. 291 Alma Street 3. 525 Alma Street 4. 539 Alma Street 5. 600 Block Alma Street (A) 6. 600 Block Alma Street (B) 7. 917 Alma Street 8. 955 Alma Street 9. 999 Alma Street 10.335 Bryant Street 11. 518 Bryant Street 12.522 Bryant Street 13.540 Bryant Street 14.737 Bryant Street 15.508 Emerson Street 16.540 Emerson Street 17.611 Emerson Street 18.701 Emerson Street 19.723 Emerson Street 20.745 Emerson Street 21. 825 Emerson Street 22.163 Everett Avenue 23.420 Florence Street 24.203 Forest Avenue 25.221 Forest Avenue 26.227 Forest Avenue 27.100 Block Hamilton Avenue 28.100 Hamilton Avenue 29.116 Hamilton Avenue 30.122 Hamilton Avenue 31. 177 Hamilton Avenue 32.210 Hamilton Avenue 33.240 Hamilton Avenue 34.248 Hamilton Avenue 35.459 Hamilton Avenue 36.505-Hamilton Avenue 37.120 Hawthorne Street 38.444 High Street 39.575 High Street 40.654 High Street 41.790 High Street 42.831 High Street 43.849 High Street 44.200 Homer Avenue 45.214 Homer Avenue 46.230 Homer Avenue 47.232 Homer Avenue 48.250 Homer Avenue 49.260 Homer Avenue 50.270 Homer Avenue 51. 300 Block Homer Avenue 52.433 Kipling Street 53.127 Lytton Avenue 54.130 Lytton Avenue 55.131 Lytton Avenue 56.181 Lytton Avenue 57.255 Lytton Avenue 58.325 Lytton Avenue 59.493 Lytton Avenue 60.700 Block Ramona Street 61.735 Ramona Street 62.819 Ramona Street 63.820 Ramona Street 64. 101 University Avenue Inue 66.174 UniversitY Avenue ¯ 67.220B University Avenue 68.227 University Avenue 69.235 University Avenue 70.335 University Avenue 71.367 Avenue 72.477 University Avenue 73.516 Avenue 74.525 University Avenue 75.530 University Avenue 76.567-581 University Avenue ¯:, June 25,2002 Dear Council Member: Depa~ent ot Pianning and Community Environment When the SOFA Study Group was formed by the City Council in response to the planning opportunity presented by the PAMF move, there were a couple of fundamental principles in p!ay; !) create more housing; and 2) do not hurt the existing businesses and property owners. The SOFA II plan fails on both counts and many more. The question at this point is whether or not the plan can be modified or should we start over as part of the City-wide zoning update? My opinion is that the zoning update has more promise depending on the protocol the Council employs to go about the task, but if the Council prefers to massage the SOFA II Specific Plan, we can all roll up our sleeves and make it happen. In broad terms, the principle objections to the SOFA II Specific Plan are as follows: #- #- Amount of commercial which can be supported without parking; Neighborhood serving commercial is too restrictive; Ground floor restrictions on small office uses; Inadequate FAR to encourage housing; Two-way traffic on Homer destroys feasibility of Whole Foods grocery store; Loading zone on Emerson (go look at Whole Foods alley); Elimination of mid-block pedestrian crossing, which was integral to Whole Food’s decision to have a store with remote parkir~g; Elimination of P.C. Zone. Due to the variety of lot sizes and uses, a one size fits all strategy makes no sense. The P.C. is the safety valve which addresses unique opportunities; Mission creep of historic preservation; Grossly inadequate "grandfather clause"; 700 EMERSON STREET ¯PALO ALTO1 CALIFORNIA 94301 ¯TELEPHONE 1650) 326-2244 "TELECOPY (650) 326-2920 Council Member June 25, 2002 Page 2 Design guidelines for private property which is inconsistent with Council policy for the existing "downtown design guidelines", which are merely a resource as opposed to an ordinance. The one design concept that has merit isto require storefronts which are conducive to either a retail or office use; The bottom line is that the proposed SOFA Coordinated Area Plan fails to create incentives for housing and is punitive to existing businesses and property owners,. A "zoning plus" approach would have created carrots inthe existing CDS district to encourage housing, retail, and adequate parking. This is a classic mixed use neighborhood which the market is constantly redefining. The eclectic nature, existing uses, lot sizes and buildings require land use choices. Some properties are appropriate for one use and not .another. The members of the "working group", which voted for the SOFA recommendation, were exclusively non-property owners of SOFA 11 who live in nearby neighborhoods. This is not the consensus necessary to impose such wholesale rezoning in an economically important area of town. We are long past the mania of the. dot.com boom and need to address the specific plan in the context of a more historic economic environment. I would be happy to meet with each of you to put more color on the points I have raised, I do believe that a "zoning plus" approach can result in the proverbial "win-win". Best regards, Charles J. K~enan, CJK/sd III THE LEAGUE OF WOMEN VOTERS OF PALO ALTO 457 KINGSLEY AVENUE ¯ PALO ALTO, CALIFORNIA 94301 ® 650/327-9148 June 26, 2002 TO:Chairman Patrick Burt and Comlnissioners Planning and Transportation Commission JUN ~P~;;~ o,’ ~iannmg and The League of Women Voters ofPalo Nto has for many years strongly supposed effo~s to increase the supply of housing in our city. We believe there must be a variety of housing oppo~unities available to all segments of the community and that housing locNed close to jobs and transit and affordable to residents of different economic levels is especially impo~am. Palo Alto has long lacked adequate and affordable housing. That shortage has been exacerbated during the growth in the past decade. As a result, Palo Alto is not able to house even those who make this city work, such as teachers and emergency personnel. The first step the City must take in addressing the housing and affordability needs in our community is to approve plans that allow for development of substantially more housing units than could currently be developed in PalQ Alto. For many years the South of Forest Area (SOFA) has b~en considered a prime opportuhity for, additional housing in Palo Alto due to its underutilized sites and its proximity to jobs, transit, and services. SOFA’s housing potential and the need to recognize this potential are acknowledged in many City policies, most notably the Palo Alto Comprehensive Plan. SOFA has the space to build more units and the amenities to allow its residents to be less dependent on au[omobiles than are residents in most other parts of the city. Some of the most significant housing opportunity sites in SOFA are not adjacent to existing single family residences. SOFA is the only arena in Palo Alto that contains this mix so appropr!ate for increased housing density. The League believes that the Draft SOFA Phase 2 Plan as proposed by the Working Group would not adequately provide opportunities for new housing development in this important area. The staff report acknowledges that neither the maximum FAR of 1.15:1 proposed in the Draft Plan, nor the staff alternative of 1.5:1, would generate the amount of housing that the City originally desired for this area. It is of great concern to the League that the Draft Plan eliminates the potential for PC zones, thereby eliminating an important mechanismfor increasing housing supply. We also believe that parking requirements in the Draft.Plan are too high for this transit-rich area and will serve as a barrier to achieving adequate housing supply dnd affordability, particularly without the opportunity of the PC zone to allow for reduction in parking [equirements. We believe that the Commission should consider and recommend to tlie City Council alternative approaches proposed by staff. At a minimum, PC zones must continue to be permitted in SOFA. Further, the League supports consideration of the alternatives outlined by staff to make the SOFA Phase 2 plan consistent with the City’s adopted goals and policies: allowing PCs without an upper limit on FAR and/or desig~:ating a sub-area within SOFA for higher density development. Planning and Transportation Commission June 26, 2002 Page Two It is imperative that the City take advantage of SOFA’s housing opportunities. The League urges you, in considering the Draft SOFA Phase 2 Plan, to recommend alternatives to this drat~ that will provide for a substantial level of housing development in this important and unique area of the city. Sincerely, Sandy Eakins, President League of Women Voters of Palo Alto SOUTH OF FOREST AREA - SOFA H I would like to remind us all of some facts which have fairly wide agreement: Palo Alto has a housing/jobs ratio which is out of balance, with many more jobs than housing. There will be, as we recover from this temporary economic setback, many jobs returning to the region and to Palo Alto specifically. A number of authorities, such as the Palo Alto-based Continuing Study of the California Economy; California state departments including Housing and Community Development Department, Finance, and others; regional groups such as ABAG, Bay Area Alliance, and Joint Venture/Silicon Valley, project that we will have one million more jobs and one million more residents in the region within less than two decades. There is a growing decrease in diversity in Palo Alto, with many workers, both low- income and moderate-income, moving to areas where housing is available to them. o Many workers important to the community, such as teachers and emergency personnel, live away from the community because of housing unavailability. 6 Palo Alto has not in the past met its state-required "fair share" requirement for providing housing for very-low, low, or moderate-income housing. Governments are experiencing a loss of income from the current economic setback, requiring cutbacks in services and bringing concern about the future. A corrollary of this is that it will be important to recover from the current economic situation and to be aware our jobs will return and our housing needs will increase. 8.And last of these general statements, the law of supply and demand still influences prices. BASED ON ALL OF THE ABOVE, I would like to comment on the South of Forest 2 area. This area is primarily colmnercial, would benefit from upgrading, and most important, is within easy walking distance of a transit hnb with Caltrain, bus lines, and local shuttles. It is within easy walldng distance of downtown. The city has authorized and plans to help fi~nd the new Homer Street bicycle underpass which will accolmnodate bicycle access to both Stanford and the Palo Alto Medical Clinic. This area will meet the requirements for a transit-oriented district, as envisioned in the Comprehensive Plan and in VTA programs and state legislation. It is one of the few areas in Palo Alto which would seem ideal for more density, adequate FAR ratios, lower pmldng requirements, more height along Alma and the northern edge, and the consideration which would result in more of the workforce housing Palo Alto desperately needs.. I especially ask that you continue a PC availability for this area. The requirements for an SRO, for example, should be markedly different. Alma Place has worked out ve12¢ well, is generally accepted, and functions well with a parking requirement which as I remember is about .5 per unit. Its residents by and large use the transit which is so accessible, or bicycle, or walk to their jobs and shopping. Development at the southeastern edge of SOFA 2 could use stepped-down heights, to accolmnodate residences closer to that portion of the area. I urge you to look critically at the very restrictive lhnitations in the SOFA 2 plan before you. One possibility would be to postpone consideration of this plan until the zoning ordinance update has been accomplished and the upcoming Palo Alto-funded general review of parldng requirements has been received. Let’s not waste the possibilities of this downtown, primarily cormnercial area, for worlcforce housing and desirable mixed-use by hnposing overly restrictive limitations. Thank you. For you consideration re SOFA II K. Holman 5/8/02 Some of the goals of SOFA II are public open space, historic preservation, retention of character and scale, encouragement of existing uses. Given that framework: Allow owners of public open space and historic properties within the SOFA II area which have not used all the a~,q.~’.~l~ii~AR to sell TRD’s for that unused portion of ~;:For example, ff an owner’of a property as identified above has developed .75 of their allowable FAR, they could apply to sell .4 FAR. The recipients of these TDR’s could be along Alma, downtown and/or any other area identified as appropriate. Thi~opo~al ~ssumes a universal FAR in S~O.FAIII of 1.15, for exampl~;"~Fffmaximums along Alma of 1.5, again for example. There needs to be amarket for TDR’s for a program to be successful so PC’s, whether allowed in SOFA II or not, cannot be granted in Palo Alto without SIGNIFICANT demonstrated and proportional benefit to the commm~ity. Benefits of a successful TDR program such the one I’m proposing (in no particular order): Provides an incentive to provide public open space with the opportunity to work with owners who have the best location/s in SOFA II as opposed to potentially accepting public open space as part of a PC project (what other incentive is there to provide it) which may or may not be the best, most accessible sile. Encourages the preservation of historic properties by providing a means to achieve economic value from property without having to succumb to development pressures to develop to the maximum FAR on sensitive properties. Encourages the retention of neighborhood serving and retail in historic buildings because redevelopment often results in higher rents and thus often forces out local and independent businesses which cannot afford the higher rents. Helps continue the character and scale of SOFA II while allowing area/s that are appropriate for more intense uses. Although it is truly not a requirement to make for an equal distribution of value in making best land use decisions, this seems a simple way to help accomplish that while primarily achieving stated goals. This program is similar to the policies used to retain farmland and open space outside urban growth boundaries. There is benefit to the community and the environment to implement those bom~daries and less development potential outside the growth boundary. I welcome suggestions as to the appropriate review/determination methods below. Suggest that HRB review and recommend the appropriateness of the TDR for historic properties. Suggest there also be a review system for appropriateness of open space TDR’s and open space design and maintenance standards require~nents be developed. The draft plan for the second phase of SOFA (~SOFA II") increases housing opportunities for the long term real estate investor. An ~conomic analysis of SOFA II demonstrates it would be feasible to invest long term in housing in the South of Forest Area at a density that would be compatible with neighborho©d characteristics. It comes as no surprise that some real estate developers are unwilling to build housing in downtown Palo Alto which is compatible with the neighborhood. Real estate developers who assumed that SOFA II was intended to generate short term profit making opportunities drew the wrong conclusions from the mlsslon statement for SOFA II. It has been common knowledge for over a decade that enhanced housing opportunities in the Bay Area will be created by those who are willing to make long term investments in their community. The City Council directive that SOFA II enhance housing opportunities Is satisfied by enhanced housing opportunities for long term real estate investors. After all, long term real estate investors have long been fixtures in Palo Alto. By improving the zoning plan to benefit long term real estate investors in Palo Alto, the SOFA II plan benefits an important sector of our community. Developers who thought that SOFA II would allow them to engage in day trading in Palo Alto real estate at profits of 20% a year are apparently discouraged. However, no zoning law can enable a real estate developer to make short term profits in a recession. Moreover, a SOFA II plan that encouraged such activity would be irresponsible. SOFA e-mail.doc May 8, 2002 NTA ENTE D INTO PUBLIC R CO D NA " THE Members~ the Pl~ and~Transportation Commission City of Palo Alto 250 Hamilton Avenue Palo Alto, CA 94301 R-e: UrafLffo~th of Forest Area-oordirmted Area Plan - Phase 2 Dea~_C~iairmar~ B~ .a~-~s-:ofthe Pl~rLning and Transportation Commission: As an obse~ve~ of fl~te~S(gF~ II~.plm-vprocess and a housing, advocate, I want to share several thoughts on the-4raf~p~yor~ rev;ew and consideration. As mm~y of-yo~-areaware;, ~r-D~Dack!~round is in residential housing development and property management. Over-the-last~twenty-years, I have been involved in the design and construction of numerous housing projects that have contributed thousands of housing units to the greater San Francisco BayAreaw I-am qui~e fan, at with the challenges and ee~omic constraints of bringing housinK proj~W to-fruiff6n..in, a-commercially driven~reaLeata~6- economy, especially in the downtovwrvPalo~Al~0 area. t suppo~_t~e. W~r!4~ Gro~!s~- recommendations to promote oppor~_nities for combined residentia~an4 eore~erci~c~evMopment and affordable housing~ -However, it is my opinion and concem41~a~-the-~l~5vl-recommend~d]~6or area ratio maximum of the draft SOFA II plan will not achieve-~eralkhr~using goal,s of the Cit~ of Palo Alto within th~area. I recommend that the pian.incorpora~-fl~e concept and provide fo~ the opportuni~f ~or~... ter housing densities in this transit-orientect neighborhood with higher allowable floor area ratios. In a~L str0r@tF ~tl-m’Commi~sf6n to retain the availability of ~e PC zoning withi~the~S~FA~ t~ pimp. I~a-rrvcon~e4med ttiat ff the PC zoninKis eliminated from the plan, this will greatly diseourage~~irt~algy preclude any ~ubstantial housing development within the SOFA ~I!:_.area. The~3OFA-~.area contains many. unique land parcels with challenging sizes, confi~a~ions:~ and. other characteristics that do not naturally ~ themselves to housing development:As-you are aware, the economics of urban~resid~projects are primarily driven by the pm~etvsize andhnd~rground parking, and ,there_ aze less_than- a_ handful of sites, as they exist tcyday~- wi~ tl;UN area that can be successfully.r~d-.fgr housing. The PC zoning allows tlie City more flexibility in responding to th~ uniclue~c-~r~.~t~ .er. istics of the SOFA II land parcels in ordFOr to promote better designed projects.and, more available housing. Finally, I u~oe-the Commission~togrant~provals for greatllz needed high density housing on. the 800 High Stree# parcet; Th~sitevi~as l~een studied for over four years, and will make a superb transik-oriente~, resident~-proje~in t~e downtown Palo Alto area. SincereIy yours, Joseph F. M ’ar~ President and CEO Ventana Property Services, Inc. A R C H TECTS May 8,2002 Members of the Planning Commission City of Palo Alto 250 Hamilton Avenue Palo Alto, CA 94301 Dear Members of the Planning Commission, As a tenant near the SOFA II area of the City, I have an interest in any new regulations that may be imposed within this area. Over the years I have designed and developed several residential and commercial projects, many of them within the City of Palo Alto. I have, therefore, experienced the difficult economics of putting together housing projects in Palo Alto, especially near the City’s costly downtown real estate market. In particular, I believe the working group’s recommendation to eliminate the Planned Community zoning will virtually preclude creative development within the SOFA II area. In addition, my project design experience has c0nsistently shown that the City’s multiple family zoning regulations do not work well, and often lead to inferior project design. The PC zoning must be retained to allow development proposal flexibility on the few remaining sites suitable for residential development in the City. Best Regards, Tony Carrasco 120 Hamilton Avenue, Palo Alto, CA 94301 ¯ 650 322 2288 ¯ FAX: 650 322 2316 ¯ emaih architects@carrasco.com A Professional Corporation Full Degree° May 6, 2002 Palo Alto High Street Partners, LLC 909 Alma Street Palo Alto, CA 94301 RE: 800 High Street Residential Project Dear Woody: Thank you for visiting our office and giving me the chance to review your project at 800 High Street. The information and drawings you showed me seem like it will be an exciting project. I am pleased to see additional housing in the area considering the excess of office space already. I liked several aspects of the design; the on-site parking garage, additional street trees and the High Street fagade. I support housing in the area and support this project. Please continue to keep us informed as the project and design details are further developed. I wish you luck with the project as you move forward. Regards, Chief Financial Officer Full Degree Eric Sterger Kurt’s & Dorn’s Auto Service 930 Emerson Street Palo Alto, CA 94301 May 6, 2002 Palo Alto High Street Partners, LLC 909 Alma Street Palo Alto, CA 94301 Re: 800 High street Residential Project Dear Woody: After having reviewed the proposed housing project at 800 High Street, I am in full support of the project. It will help re-vitalize a site that has sat un-used for quite some time while bringing a housing element that is very much needed in the area. Local businesses such as ours will, of course, appreciate the introduction of more customers via a project that will make the area more vibrant. Good luck with the project and thank you for sharing your information with us. Sincerely, Eric Sterger Manager Kurt’s & Dorn’s Auto Service May 6, 2002 Palo Alto High Street Partners, LLC 909 Alma Street Palo Alto, CA 94301 RE: 800 High Street Residential Project Dear Woody: I would like to thank you for reviewing your project at 800 High Street with me. I am quite familiar with the previous proposal for that site and this certainly seems like an exciting opportunity to bdng much needed housing to the area. There are several points in particular that I appreciated about this project versus the previous proposal. I am very pleased to see that this project is all housing as opposed to a majority of office space. With the project fully parked on site and the garage entry being moved to the alley and off of Channing; I see this as a much better solution. As an advocate of affordable housing, I am pleased to see that 9 Below Market Rate units are being offered. Finally, the addition of new street trees and additional on-street parking spaces will add to the vitality of a currently dormant area. Based on the information presented to me and my knowledge of the area and the previous project, I fully support the residential project at 800 High Street, and am eager to see the project get off the ground. P’am Davis President Buena Vista Residents Association Sep-30-02 02:58P BAE -Davis, CA 530 750 2194 P.02 Attachment September 3, 2002 Mr. Steve Emslie Director of Planning and Community Development City of Palo Alto 250 Hamilton Avenue Palo Alto, CA 94301 Dear Steve: The purpose of this letter is to respond toyour inquiry regarding the redevelopment feasibility threshold that we used in analyzing the various alternatives I’or the large site prototype as part of our SOFA 11 financial analysis, As I will explain below, there is no single figure that can represent development feasibility, even withi~l an area as small a.~ SOFA !1. While it can be argued that the development feasibili .ty threshold that we chose tbr the large site prototype is not representative of all sites within the SOFA 11 area because part of the site is pt!blicly owned, I believe we have been carelhl to try to explain that the analysis represented a specific set of circumstances on a specific properly and tha.t feasibility thresholds can be expected to vary from property to property within the SOFA I 1 area, Recognizing that the City may find a more general indicator of development feasibilily to also be useful, 1 am providing some additional discussion regarding the "residual land valt,es" that we estimated for the different SOFA 11 development prototypes, in relation to reported market nlte land values within the City of Palo Alto. The results of our prior analysis indicate thal. at a development intensity of 1.15 FAR (with reduced parking) (he large site prototype would support a residual land value that is in the range of commercial and multifamily land values reported in the City’s Housing Elemenl, More specifically, our origiual analysis indicates that the economics of the 1,15 FAR large site prototype with reduced parking would allow a developer to pay a price of approximately $165 per square foot for a development site, which is within the range of values that were mentioned in th~ Housing Element update tbr multlfamily residential and commercial land within the City of Palo Alto ($150 to $167 per square foot). While the owner of a property that is developed to ~= fairly high intensity and which generales significant net income may not. be satisfied wilh selling his/her property at that price level, the owner of a property with functionally obsolete buildings, or of a site that is developed at a relatively low intcnslty could find dais level of valise quite attractive. Meanwhile, the large site developmeltt prototype lmsed on a 1.5 FAR With reduced parking would support a residual land value of just over $200 per square foot and the I:~rge site development prototype with a 2.5 FAR and reduced parking would suppt~rt an even greater residual land value. S~crament,~ Of’fi~e 530.7q0,~195 740 G Street fax r~30,750.;~104 D,~vi,~, rdA g’~616 baelC~bael.cnn1bayareaeconomics,com _Sep-30-02 02:58P BAE - Davis, CA 530 750 2194 P.03.__ Background As we explained in our original analysis, the large site prototype that we defined f’or tile purposes of the SOFA II financial analysis was based on combining two smaller sites into a larger site. The two smaller sites involved a parcel already developed and occupied by an auto-related use (i.e., auto repair shop) aud an adj;~cent city-owned site that is currently occupied by an electrical substation. The purpose of estimating a "’redevelopment incentive threshold" tbr each of the Siles (i.e., the small site and the large site) was to estimate the price that a developer would have to pay the property owner to make it attractive to the site’s owner to sell it for development consistent wifl~ the proposed zoning regulations. After establishing the redevelopment incentive threshold for each of the sites, w~ could then compare Ihe residu~d land values that we estimated for each of the development prototypes with Ihe appropriate redevelopment incentive threshold. If the residual land value for a given prototype was equal to or greater than the re:development incentive threshold for the small site or large site, as appropriate, then we deemed the prototype feasible. For the small site, we estimated the redevelopment incentive threshold to represent a level that would provide Ihe property owner with compensation that is ten per’cent greater than t.he value that would be derived by capitalizing the estimated net income fi’om the existing use of the site. FOr the large site, we estimated the redevelopment incentive flireshold to represent a level that woald compensate Ihe owner for the value of the small site plus an additional value that was equal to file estimated cost of relocating t.hc substation, plus a ten percent premium. : Wc understand that there is concern that the location that the large site represents is unique among SOFA 11 area properties due 1o it being partially owned by the City and, therefore, it could bc argued that the redevelopment incentive threshold that we estimated tbr that site may be lower than the wdue that wonld trigger development ’~feasibility" on t~ther properties in the SOFA 11 area Ihat are privately owned. In fact, in my presentation to the Planning and Transportation Commission on August 7,. I was careful to polnl out lhal the finding that a particular p~ototype met tile assumed redevelopment threshold was specific to that particular prototype developed under a specific set of assumptions, that there is no single’ residual land value that would be indicative of an economically attractive development prototype within the SOFA il area, and that literally each property owner can be expected to have a different perspective on what constilutes an adeqnate i~centive to develop Iheir property rather than leave the property in its existing state. Thus, in addition to con,~idering the results of the pro-forma analyses fbr the d{fferent development prototypes in r¢lalionship to the development incentive thresholds that we eslablished for the particular parcels that we used as our examples for the purposes of the analysis, it is also uscfid t.o simply consider fl~e residual land values associated with the different development prot¢.~types and ask the question of whether, if permitted a certain Sep-30-02 02:58P BAE -Davis~ CA 530 750 2194 P.04 level of development inteusity, a developer would be able to afford to pay a "murket" rate price for the land necessary to build the project. According to i,lfbrmatlon published in the City’s recently updal~d Housing Element, multifiamily r~sidentinl land values within the ~ity range from $150 to $167 per square t’oot and above and ~o,nmercial land values are about $150 per square foot, In comparison, th~ large site SOFA il prototype involving 1.15 FAR. with reduced parking standards would generate a residual land value of $165 per square foot. The large sit~ prototype involving a 1,5 FAR with reduced parking would generate a residual land value of about $200 pet’ squar~ foot, and the 2.@ FAR large site prototype with reduced parking would generate a residual land value ol" over $250 per square foot. Conclusions In consideration of our original analysis as well as the additional discussion provided above, w¢ b~lieve it should be ¢l~ar that: a)if the City suppo~s an increase in the allowable FAR in the SOFA !1 area to I.I 5 or above and allows reduced parking standards, lhe City will be making development within the SOFA II area more economically attractive than it is under current zoning regulations, and; b)generally, with all other factors being held constant, as the allowable FAR increases, there is more incentive for redevelopment in the area, and; c)if the City allows development similar to the prototype wc defined fi~r the large site at an FAR of 1~15 with reduced parking, a prospective developer should he able to pay a property owner a "market value" for his/her land that is in line with current multif’amily residential and commercial property values, as reported in the City’s Housing Element. 1 hope that this additional information is useful as the City continues to discuss the proposed SOFA I! development regulations. If we can provide any additional assistance, please do not hesitate toconlact me. Sincerely, Matt Kowta, l@.C.P. Principal