Offices squeeze out more downtown retail

City Council members voted Tuesday to allow a downtown property owner to convert five retail spaces at 783 Castro St. into offices.

The switch to higher-paying office tenants would allow owners to pay for building upgrades, including a new roof, facade and electrical systems, said investors and representatives of the Mancini family that owns it. But those concerned with downtown's walk-ability were not pleased, as the loss of retail would "deaden" that portion of the street, as council member Ronit Bryant put it.

City planners were apparently concerned as well, bringing the conversion to the council's attention, even though ground-floor office use is allowed by that portion of downtown's zoning.

"I find those stores make it more interesting to walk on Castro Street," said Bryant. "The rendering here is of a fairly blank facade. It makes it even more different to walk up the street to whatever businesses are trying to stay. It is part of deadening Castro Street. I don't find this an enhancement to the street."

Likely to be displaced is a law office, a travel agency, a Moroccan gift shop, a salon, an acupuncturist and a chiropractor.

"I don't want to offend any existing tenants but these are lower-end retail uses," said Bob Odelay speaking for the Mancinis, a family that's had a major presence in Mountain View's business community for nearly a century.

"To do a renovation you'd have to easily double rents. You can get higher rents for office than you can for retail," he said.

For some council members, it came down to "an element of fairness" to the owners, as member Chris Clark put it. Odelay said city planners knew about the project months before they decided that "the plan might be changed retroactively" at the council's discretion, he said. City planners said they thought that public input should be the "deciding factor" in such a major change downtown.

"I'm big believer in retail on Castro Street, but that's not the rule here," said council member Mike Kasperzak. "I don't think you can change the rules without letting people know the rules have changed so they can make decisions. The rules in this area are very clear."

To potentially change the rules now does not set a "great tone for the city," he said.

Odelay said the building provided the sole income for four members of the Mancini family, and that not allowing the change in zoning would mean hurting their income stream. Council member Jac Siegel sympathized with the owners. "You got to do what you have to do to keep the building, otherwise you are in trouble."

The switch from retail to offices downtown isn't the first in the new tech industry boom that has the vacancy rate for offices downtown near zero.

In 2011, Rick Meyer of Meyer Appliance obtained a change in zoning to allow his building at 275 Castro St. to become offices and he moved his appliance store to El Camino Real. Once the city's J.C. Penney, the building has an imposing presence downtown and is now occupied by a tech startup.

At a Zoning Administrator meeting June 22, 2011 there was no opposition to Meyer's request and it was approved, said zoning administrator Peter Gilli in an email. "The relationship between the basement and the ground floor area made it difficult to market the space as retail, except for something like an appliance store," Gilli said of 275 Castro St.

A small gym was forced out of 650 Castro St. last year by Prometheus Real Estate Group, which started charging Custom Fitness $12,000 a month, up from the $5,500 owner Dale Dunlap had been paying for the 2,200-square-foot space. Gilli said ground-floor office use is also allowed in that portion of the downtown.

Elsewhere downtown, a five-story office building is under construction to replace the Pacific Inn hotel on Evelyn Avenue and another office building will soon replace the historic Pearson House at 902 Villa St., once home to a toy store.

"I would prefer retail but Mountain View doesn't attract retail at any kind of rate downtown," Siegel said. "When people want to buy shoes, they want to go into a place that has a thousand pairs of shoes. We just don't attract that in Mountain View."


Like this comment
Posted by Downtowner
a resident of Old Mountain View
on Feb 4, 2013 at 11:50 am

Does Jac Siegel know that there is a shoe store downtown? It seems to be doing just fine.

Like this comment
Posted by Garrett
a resident of another community
on Feb 4, 2013 at 12:17 pm

How can a small retail shop surive the onslaught of chain stores, malls and the online retailers.

Office space is needed right now, retail not so much.

Like this comment
Posted by Charlie
a resident of Sylvan Park
on Feb 4, 2013 at 2:17 pm

A very short sighted view by our city "leaders". With all the new housing going up nearby we need to keep Castro St. interesting to flourish. This creates a precedent. What if Castro was all offices. Who would come to Mountain View then?

Like this comment
Posted by Martin Omander
a resident of Rex Manor
on Feb 4, 2013 at 2:37 pm

This is a tough one. Retail is needed to make downtown Mountain View come alive. But if the zoning of that part of Castro St says offices are OK, then should stick to the rules we set ourselves.

Actionable insight for the rest of us: If you want a living downtown, spend money there! For me, there are few Sunday pleasures greater than buying books and Books Inc, followed by a light lunch at the cafe upstairs.

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Posted by Ron
a resident of Waverly Park
on Feb 4, 2013 at 2:40 pm

@Charlie: Not that I would mind a lot of cool retail, but that is NOT what downtown MV is known for. People come for the restauants. There are tons, and a new beer garden being built. And it is SO packed on any evening that parking is near impossible, so I don't think the crowds are going anywhere. Retail is just not the thing here.

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Posted by FEDUP
a resident of Old Mountain View
on Feb 4, 2013 at 2:42 pm

We are toasting the city district for who?

BTW people you want to stop a CEQA project it is called a writ of mandamus. File them left and right and put the breaks on what appears as a city under siege.

There is so much happening it makes my brain hurt just to wrap my head around it. What are we doing? I have zero love of that little shopping center, but its a slippery slope from council with only one mind: fill the coffers of the developers and screw the people they have no voice. This is corruption folks, Bell style of corruption.

I want to know the relationships to council and developers. Smells bad here, real bad.

Like this comment
Posted by Soc Alist
a resident of Old Mountain View
on Feb 4, 2013 at 3:51 pm

How about the city council set aside some below rent money to help the poor retailers keep their business's going downtown? We're so ready to help the poor residents, why not help the poor businesses?

It worked great for the USSR for so many years. Our enlightened city council must surely be thinking along these lines of thought already.

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Posted by maguro_01
a resident of Willowgate
on Feb 4, 2013 at 5:21 pm

"How can a small retail shop surive the onslaught of chain stores, malls and the online retailers."

Castro Street is a mall run by Mountain View and building owners. Much of it has become a Food Court. It would be unfortunate if too many storefronts on Castro Street became offices - one way out of that is larger buildings with a ground floor retail requirement when they are built. The flip would be higher rents, of course.

The future of the area surrounding downtown is higher density as is the area surrounding downtown Palo Alto. University Avenue may turn into a Santana Row, apartments and all. Ultimately the market determines land use. When a very modest single family house sells for millions, the building is doomed. It's something like the forest progression. True, if an owner can skip a stage before they sell, they make out. That's one of the motives I suppose of the people who demand that the world around them freeze to the horizon the day they start making mortgage payments and who work tirelessly for general taxpayer funding for neighborhood improvements. The house may be the only savings they have which is risky. Only a few are really interested in the ecology...

Mountain View is also moving relentlessly up market. One can wish Google, etc, every success, but soaring rents are driving out a sizable part of the population and mean there is little or no bootstrap startup space available. Higher income tenants in lower end buildings will prove less stable, at some point the buildings will go and be replaced by higher density.

We gather that funds with access to the current cheap money have been buying up housing. Is that true in this area? Can anyone make informed speculations about any such activities in this area? Since valuations of rental properties are mostly a multiple of the rents one would think that speculators would make rents and other prices more unstable.

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Posted by Garrett
a resident of another community
on Feb 4, 2013 at 7:14 pm

Look at the building at Castro and Church, the 2 story building that most likely will be torn down, look at 895 West El Camino, this end of Castro St has been a mix of retail and offices.

Their was a shopping center on Castro St where the Kaiser Medical building stands, across from 444 Castro St is a mix of offices and retail.

Yes it would be nice to have Santana Row shops, why not do a Sunnyvale.

Rather have a food court then a big empty mall. We do have some retail, better then most places.

Like this comment
Posted by Rossta
a resident of Waverly Park
on Feb 4, 2013 at 9:28 pm

Rossta is a registered user.

We (Mountain View, using our tax dollars) spent a ton of money to create a vibrant downtown area that is the envy of many neighboring cities. What makes it great is that there ARE places to walk to and shop at and dine. I love the description that this is a mall whose food-court has grown quite large.

The offices at ground floor kill our downtown. Just like a mall with many closed shops. Castro is being shortened by two blocks with this change of a block to offices. I bet Amici's will feel it. This is short sighted. We started to see this in 2000 where the tech boom was so large that nothing could compete on a level playing field. We were fortunate that ended abruptly before too much damage was done - though we are still paying in many ways with pensions that tried to compete.

What we need is zoning that matches our planned use. We built downtown to be an open mall. Zone it as such, the same way a mall would be managed. First floor retail only. Rent on first floor will stay lower than the upper floors, when offices are in high demand like now. They shouldn't be competing with each other in an area where we have invested in creating something special.

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Posted by Garrett
a resident of another community
on Feb 5, 2013 at 2:13 pm

As more nicer looking office buildings are built, older office buildings might become affordable, those ground floor offices might move to nicer digs. Ground floor units might become retail. Give it time with what is going on downtown, new housing units popping up here and there, new young people moving in, new workers, new visitors.

We have a few places left that new mixed use building can be built, across from the train station, and 400 block of Castro St, odd side of the street. Retailers want something larger then what we have to sell those thousand of shoes.

Like this comment
Posted by Rodger
a resident of Sylvan Park
on Feb 8, 2013 at 10:56 am

The downtown area will die if retail is converted into offices, we have to find a way to reverse this trend. This an important job for city planning, don't just roll over and give in to offices.
It's my understanding that retail brings in good money in sales tax, what kind of taxes are paid by offices.

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