Slow Growth Development
Earlier this year, I wrote in this blog that it was going to be a very interesting summer in Palo Alto due to long-simmering tensions between its pro-growth and slow-growth factions, and that the manifestations of this conflict could have profound and significant impacts on Palo Alto’s development policies and business/economic climate. Recent events in Palo Alto appear to have borne out these forecasts.
SurveyMonkey, which was founded in 1999 as an online survey company but which has shifted its focus in recent years to enterprise services and consumer analytics, and which has been headquartered in Palo Alto for the past five years, has just signed a lease to relocate its offices to San Mateo’s Bay Meadows mixed-use development project. When completed in early 2017, SurveyMonkey’s new facility will be four times the size of its current space, an increase necessitated as a result of faster than expected company growth.
As I noted in another recent blog article, the City of Palo Alto has been contemplating a variety of different methods for controlling development in that city, including a cap on new office space. SurveyMonkey publicly opposed the adoption of this cap, and its ability to expand in Palo Alto had been hampered by these development restrictions. As to whether Palo Alto’s development climate influenced SurveyMonkey’s decision to leave behind its long-term leased space on Lytton Avenue for greener “meadows” in San Mateo, the answer you will get will depend on whom you ask; regardless, SurveyMonkey now joins a growing list of companies (e.g., Google, Facebook) that took flight in Palo Alto but outgrew their original homes.
In the meantime, Palo Alto continues to struggle with its development policies. The Palo Alto City Council is presently discussing proposals for reforming its controversial zoning regulations for planned communities, which have included the negotiation of “public benefits” (e.g., supermarkets, plazas, police facilities, and artwork) from developers in exchange for exempting developments that exceed zoning standards.
Although planned community projects in Palo Alto have been on hold since February 2014, the approval process continues to be a subject of controversy and dispute, in particular the hoary practice of allowing developers to offer cash as a “public benefit,” which one Palo Alto planning commissioner described as “the definition of zoning for sale.” For a city that prides itself on thoughtful policymaking, such a blatant quid pro quo smacks of patronage, and reflects the troubled state of land use regulation in Palo Alto.