News

Affordable housing project carries steep price

Partnership proposed between nonprofit, Prometheus to fund 71-unit project

A new five-story affordable housing project that would replace a downtown Taco Bell received enthusiastic support from a City Council subcommittee on Thursday. The project at 950 W. El Camino Real would create 71 badly needed affordable apartments, but it could require the largest city subsidy to date for a project of its kind.

In total, the project by the nonprofit Palo Alto Housing is expected to cost about $41 million to build. That hefty price is due to the familiar factors of the frenzied real estate market, said Danny Ross, Palo Alto Housing development manager.

“Land costs are at an all-time high; construction costs are at an all-time high,” he explained to the city committee. “The per-door costs are going up across the board for us.”

Mountain View would need to pay about half that price, $22.7 million, which would deplete most of the city’s affordable housing fund. But city housing staff suggested they could raise this amount from market-rate projects that are currently under planning review.

A good market-rate project for this, they suggested, would be a proposal by Prometheus Real Estate to build 471 apartments at the former Flower Mart property on the 500 block of E. Evelyn Avenue. Prometheus representatives offered to “prefund” the fees they would eventually have to pay for affordable housing.

City leaders have been receptive to this prefunding idea for other recent projects, pointing out that it can provide millions of dollars upfront that can immediately go toward affordable housing. By taking the money, city officials emphasize they are not agreeing to a quid pro quo to approve a developer’s project. Under this agreement, if Prometheus’ project was denied, the city would need to repay any money that was prefunded.

“This is one of the creative things the private sector is bringing forward,” said Mayor Lenny Siegel. “This is a great location for a project like this.”

Nearly all of the 71 affordable housing units proposed by Palo Alto Housing would be priced for households earning less than 60 percent of the median income. One quarter of the units would be reserved for developmentally disabled individuals.

The council committee supported several exemptions for the Palo Alto Housing project, allowing the building to be constructed taller and denser than normally allowed. They also gave conditional support to a minimal parking ratio that would provide a dedicated parking space for approximately one out of three residents.

The city’s “Notice of Funding Availability” committee supported the Palo Alto Housing proposal in a 3-0 vote. The project is expected to go before the full council next month.

Palo Alto Housing is also planning two other large projects that will be coming up soon for review. Those projects include a 70-unit development and a 101-unit studio project, both located on Terra Bella Avenue.

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Comments

29 people like this
Posted by Rossta
a resident of Waverly Park
on Apr 20, 2018 at 4:13 pm

Rossta is a registered user.

I am confused about how this would work. Is the $22.7 million from the city to create these affordable houses something that becomes equity for the city down the road? Or is it a $300,000 gift to each of the people who end up moving into those places?


59 people like this
Posted by Alex M
a resident of Willowgate
on Apr 20, 2018 at 4:21 pm

Oh, stop. Not Prometheus again? The company that seems to have the City Council in their pockets? Has Prometheus EVER built a housing project that lets residents OWN their dwellings rather than rent them? MV has far too high a rental population already.


64 people like this
Posted by Robyn
a resident of another community
on Apr 20, 2018 at 4:36 pm

It is particularly galling to have our tax money flow to private entities while they continually destroy our quality of life - taller and denser buildings with minimal parking. Would the developers live in these tenements? How about the Council?


44 people like this
Posted by Shelly
a resident of Old Mountain View
on Apr 20, 2018 at 4:51 pm

Just say no to this mess. Buy up some old apartment buildings and use those.


36 people like this
Posted by YIMBY
a resident of Another Mountain View Neighborhood
on Apr 20, 2018 at 4:51 pm

@Robyn

It's galling that you think Mountain View is an HOA that exists to ensure you don't have to deal with tall buildings during a housing crunch.


37 people like this
Posted by YIMBY
a resident of Another Mountain View Neighborhood
on Apr 20, 2018 at 4:54 pm

Better title: Entitled homeowners blocking housing development externalize a steep cost onto others


51 people like this
Posted by William Hitchens
a resident of Waverly Park
on Apr 20, 2018 at 5:04 pm

William Hitchens is a registered user.

"Just say NO". If you can't say no, then dictate at least 2 underground parking spaces per unit. No more "mass transportation" delusional fantasies. And just remember MV "City Council". In today's hyper-inflated real estate bubble, NO housing is affordable. It all is extremely Unaffordable. The only issue is --- who gets skewered with the huge long-term expenses??? The few lucky residents who win the lottery, or the many taxpayers of Mountain View????


39 people like this
Posted by Nia
a resident of Willowgate
on Apr 20, 2018 at 5:50 pm

Isn’t 15% of new construction supposed to be dedicated to affordable housing? 15% of 471 new units is, what? 71 affordable units? Nice coincidence!
Prometheus should pay close to 100% of the 950 W. El Camino project, or dedicate 71 of the 471 units in Flower Mart to affordable housing.
I don’t think subsidizing 50% of Prometheus obligation is creative thinking.


55 people like this
Posted by Bored M
a resident of Cuesta Park
on Apr 20, 2018 at 10:03 pm

It is insane that anyone thinks that renting makes anyone but the developer better off in the long run. The City Council and Palo Alto Housing should be promoting the development of condos and townhouses over rental units. Incentives and plans should focus on helping families build equity, not affordability as they have defined it. In 10 years we will be fighting the same issues if we continue with these nonsensical plans.


26 people like this
Posted by Sara Sherry
a resident of another community
on Apr 21, 2018 at 11:59 am

Low income housing has destroyed my life. No opportunities to get to the other side of poverty. It's not the answer to house people and leave them to rot. I'm a college graduate with one child. Every time things get tough I'm told. Go to the food bank. Go get utility assistance. Go here, go there...but I want out of low income housing. I want to pay my own way. Where is the answer for that????


29 people like this
Posted by Monta Loma
a resident of Monta Loma
on Apr 21, 2018 at 6:16 pm

"By taking the money, city officials emphasize they are not agreeing to a quid pro quo to approve a developer’s project. Under this agreement, if Prometheus’ project was denied, the city would need to repay any money that was prefunded."

Come on. If the City takes millions from Prometheus for a project that has yet to be approved, there is zero chance that the City Council will refuse the project and pay back the money. This deal would give Prometheus a ridiculous amount of leverage...not that they don't already get pretty much whatever they want from the City.


16 people like this
Posted by Bill
a resident of Rex Manor
on Apr 22, 2018 at 1:20 am

This area is a housing economic bubble that was created by poor regulations and limited development for years. Demand exceeds supply and tech pays very well. If you over tax the tech giants they have an inventive to leave the area but they are greatly responsible for the situation today. Developers are way smarter and play the long game on MV city council. Building cheap housing for poor people is answer but who wants to do that when there is so much money to be made here? City simply does not have the economic resources. Pack up and leave town is the only choice!


8 people like this
Posted by K
a resident of Whisman Station
on Apr 22, 2018 at 9:29 am

So um. How is that not a quid pro quo? What if the city doesn’t have the money to pay back the fee when that future project is proposed? And where’s the incentive to pay it back?


21 people like this
Posted by John
a resident of Monta Loma
on Apr 22, 2018 at 2:07 pm

Meanwhile in Rex Manor, off Rengstorff, there are no less than 6 affordable apartments lots with the big Mountain View notice of development signs with notification of an application to tear down the buildings, yellow tree removal tape already in place,
And replace the buildings with the usual 1.8 million dollar townhouses. Something is seriously wrong with this city.


20 people like this
Posted by William Hitchens
a resident of Waverly Park
on Apr 23, 2018 at 5:29 pm

William Hitchens is a registered user.

The ignorant socialist/populist concept of "affordable housing" is just an idealistic, pathetic lie in today's insane real estate market. I most humbly (NOT) order you to study history, socialist/populists and renters. Economic truths destroy ignorant idealism every time. The economic truth is that in Mountain View, housing is no longer "affordable". It is grossly overpriced and NOT AFFORDABLE. The only question is, if the "City Council of Fools" wants "affordable housing", they must warn taxpayers and its pensioned employees that subsidized "affordable housing" will be paid for not by the lucky occupants, but by the rest of us --- ad nauseum.


7 people like this
Posted by @William Hitchens
a resident of Another Mountain View Neighborhood
on Apr 23, 2018 at 5:39 pm

[Post removed due to disrespectful comment or offensive language]


16 people like this
Posted by Colossal
a resident of Cuernavaca
on Apr 24, 2018 at 1:21 pm

Looks like the MGM Grand Mountain View, or soon to be “Mountain Obstructed View”


18 people like this
Posted by Jeremy Hoffman
a resident of Rengstorff Park
on Apr 24, 2018 at 2:26 pm

Jeremy Hoffman is a registered user.

Remember: Our population grows. People need places to live. If we don't build more housing, we get a game of cruel musical chairs where some get left out and the rest pay through the nose for housing.

Everyone has the right to their aesthetic preferences. But no one has the right to deny their neighbors a home because they don't want to have to see a 5-story building anywhere in their city.

I love that Mountain View is being a responsible city planning for population growth. We should all be proud. We need to convince our neighbors throughout California to follow our lead. The state is short over 3 million homes with an additional deficit of 100,000 homes per year.


14 people like this
Posted by Yimby2
a resident of Old Mountain View
on Apr 24, 2018 at 3:55 pm

Yimby2 is a registered user.

Has anyone investigated why it costs an astounding $578,000 per unit to build affordable housing? This is truly insane. You can several houses for that price in other parts of the country. I know that in Mountain View, various impact fees add up to almost 6 figures on new construction, but that still leaves like half a million per unit. How much is the cost of land? How much is the cost of materials, labor?

Having investigated this a little bit in the past, it seems that CA is much more expensive in this regard than any other state due to building codes, labor codes, the affluence of the area buying up all contractor labor, etc. If you look into things like prefab housing, you even see the 49 state price, and the much higher CA. These costs, sadly, are a problem of our own making.


8 people like this
Posted by YIMBY
a resident of Another Mountain View Neighborhood
on Apr 24, 2018 at 4:32 pm

@Colossal

"Looks like the MGM Grand Mountain View, or soon to be “Mountain Obstructed View”"

Yeah, we shouldn't let something as silly as people being financially crushed by high housing costs divert our attention from what's really important here: views of the mountains.


3 people like this
Posted by YIMBY
a resident of Another Mountain View Neighborhood
on Apr 24, 2018 at 4:33 pm

Growth is good, but it must be smart and financially reasonable. I don't see this as either for this particular site.


26 people like this
Posted by Robyn
a resident of another community
on Apr 24, 2018 at 5:06 pm

[Post removed due to disrespectful comment or offensive language]


8 people like this
Posted by YIMBY
a resident of Another Mountain View Neighborhood
on Apr 24, 2018 at 5:08 pm

@YIMBY

Yeah, wouldn't want to replace an historic Taco Bell with much needed housing.


9 people like this
Posted by YIMBY
a resident of Another Mountain View Neighborhood
on Apr 24, 2018 at 5:14 pm

@Robyn

Mountain View could have been Atherton and kept job growth to a minimum, but instead it now host multiple large tech HQs and tons of jobs, and there needs to be housing to accommodate that. [Portion removed due to disrespectful comment or offensive language]


5 people like this
Posted by YIMBY
a resident of Another Mountain View Neighborhood
on Apr 24, 2018 at 5:23 pm

Its the cost. Stupid money wasted. Rubber stamping it just because it's housing, no matter what the details are for unthinking ideologues.


10 people like this
Posted by YIMBY
a resident of Another Mountain View Neighborhood
on Apr 24, 2018 at 5:25 pm

@YIMBY

Guess what, not building housing means the cost of housing rises, including subsidized housing. As long as it's next to impossible to build anything around here, I'll take whatever housing victories we can get until a stronger regional planning authority can step in and enact better long-term development strategies.


17 people like this
Posted by William Hitchens a resident of Waverly Park
a resident of Another Mountain View Neighborhood
on Apr 24, 2018 at 7:37 pm

[Post removed due to disrespectful comment or offensive language]


4 people like this
Posted by YIMBY
a resident of Another Mountain View Neighborhood
on Apr 25, 2018 at 5:49 am

I never said don't build housing. I'm just a critical thinker and look at each case independent of ideology or "Identification" with an online name. Not every project is good. Some people are more knee-jerk "Yes" men but I care to put more thought into things. It's OK if we disagree, really.


Posted by Name hidden
a resident of Willowgate

on Apr 25, 2018 at 8:22 am

Due to repeated violations of our Terms of Use, comments from this poster are automatically removed. Why?


19 people like this
Posted by Samuel Webster
a resident of North Whisman
on Apr 26, 2018 at 5:29 am

The Microsoft campus buildings near the Stevens's Creek Trail and NASA Ames Research Center are being torn down! These buildings can't be more than a decade old and were very nice.

This disgusts me to no end. The waste and Microsoft's expanding negative carbon footprint.

The greenest building is the one that has already been built. If a company tells you they are "Green" just because they stuck a few solar panels on their roof they are full of it.


6 people like this
Posted by David K
a resident of North Whisman
on Apr 27, 2018 at 3:56 pm

David K is a registered user.

@anonymous @resident,

The truth is in the details, and all over-generalizations are wrong, whether it's "all Mexicans are rapists and murderers" or "the free market is better than government". As a smart progressive, I know that the free market has a role, with its good points and its bad points, as does government. Read Sinclair Lewis if you truly believe that the "Free Market" can guarantee food safety. Ask the "seal' people (formerly the "seal babies" of Europe if there's value in an agency like the FDA to insure that drugs are both efficacious and safe before they can be marketed. Go back to the 1960's and breathe the "air" in Los Angeles and tell me if the "Free Market" can assure healthy air without any government regulation. Ask any gay man or woman if they were happy with the "Free Market" guaranteeing their health, safety and right to marry. If you can't acknowledge that at least a small part of what government does is for the greater good,[Portion removed due to disrespectful comment or offensive language]


4 people like this
Posted by george drysdale
a resident of another community
on Apr 28, 2018 at 12:21 pm

The way cities become bigger with time is to build upward with transportation going underground: London, New York etc. It's a natural function. What is making Mountain View a world spectacle is rent control going in where half the population is very educated. What I'm seeing is perhaps and growing spectacle: Money for investing in housing especially multi unit is leaving California and looking intently in Washington State and Oregon where it is against the law to have rent controls. This could be one of the biggest events in American history. I would like to thank "businessman" for providing material to get rid of rent control: Henry George lived over a century ago. As sure as the sun coming up it the sky rent control will be out of Mountain View. There is in a way a permanent initiative against rent control in Mountain View as it is the number one lesson plan in basic economics.
George Drysdale land economist


14 people like this
Posted by Stressed?
a resident of Another Mountain View Neighborhood
on Apr 30, 2018 at 8:57 pm

The obvious problem is that tiny Mountain View cannot accommodate every big tech company headquartering here. Like rats in a cage, our quality of life diminishes as density and overcrowding increase. Mountain View is a suburb. Some of us would like to keep it that way. Besides the difference in lifestyle of suburbia vs urban living, we do not have the infrastructure to support a “city” (i.e. no subways, no metro, no Amtrak). The answer is not to continue to build more and more housing, adding more and more cars, but to stop approving expansion of the tech companies which are creating the problem. These companies do not need to house the majority of their engineers here. Let them move to Texas it Oregon or anyplace else in the country where land is plentiful and housing affordable. A reduction of the work force in the area would bring housing prices down. And the free market would work.


4 people like this
Posted by YIMBY
a resident of Another Mountain View Neighborhood
on Apr 30, 2018 at 9:10 pm

@Stressed

You're a few decades too late for that. People are already here and there's already a huge unmet need for housing. You can cap new jobs in Mountain View, but that does nothing for the current problem.


5 people like this
Posted by Stressed?
a resident of Another Mountain View Neighborhood
on Apr 30, 2018 at 10:47 pm

Currently they’re continuing to expand with the approval of our city councils. But what came in can go out again. If their employees have no place to live then perhaps they’ll move them to a different location. Before the town is completely destroyed.


5 people like this
Posted by YIMBY
a resident of Another Mountain View Neighborhood
on May 1, 2018 at 9:09 am

Pretty much every millennial is packing in tight with roommates, turning single-family homes into makeshift apartments, or living in someone's garage or living room. Not building anything and hoping we'll go away is not going to work. We're people too, many of us grew up here, and there's no reason why you should be able to wall the city and it's jobs off from us. It's you who is destroying this city.


3 people like this
Posted by evolution not stasis
a resident of Another Mountain View Neighborhood
on May 1, 2018 at 10:52 am

the city scape will continue evolving ... I live in a place that 70 years ago was a farm a few blocks from El Camino (a road that has been there only since the late 1700s)

so .. must I really move out, tear it down, and convince my R1 neighbors to do the same?


6 people like this
Posted by Small Government
a resident of Castro City
on May 1, 2018 at 12:13 pm

@evolution, no one wants to make you do anything. All we want is for people to be able to build on their land how they want. We don't want the farmers of 70 years ago to be able to stop houses from being built, we don't want R1 homeowners today to stop apartments from being built


13 people like this
Posted by CITY COUNCIL ELECTIONS 2018
a resident of Sylvan Park
on May 1, 2018 at 3:54 pm

CITY COUNCIL ELECTIONS 2018 is a registered user.

If everyone is as ticked of as they sound here PAY ATTENTION... City Council Elections are coming up in November, THREE SEATS OPEN for Siegel and Showalter, Rosenberg, all propronents of high growth/high density. It's time to engage and support representatives who truly care about Mountain View.

LET'S ELECT REPRESENTATIVES THAT SUPPORT THE RESIDENTS, NOT DEVELOPERS


5 people like this
Posted by Small Government
a resident of Castro City
on May 1, 2018 at 5:07 pm

[Post removed due to disrespectful comment or offensive language]


12 people like this
Posted by MyOpinion
a resident of Sylvan Park
on May 1, 2018 at 5:10 pm

MyOpinion is a registered user.

@small government
R1 homeowners are stopping apartments from being built? You must be referring to Los Altos. Mountain View has done MORE than its part in providing apartment housing, MV must have the highest percentage of renters than any surrounding community. Prometheus alone has ~10 complexes in the City of Mtn View and pushing for more, all rentals, all high end, all high density. It never ends. We need home ownership, whether it be condos, townhomes or houses, someplace where people will call Mtn View 'home', not a stop on their way to a real community.


7 people like this
Posted by MyOpinion
a resident of Sylvan Park
on May 1, 2018 at 5:17 pm

MyOpinion is a registered user.

@Small Government
The high density complexes going up are NOT serving poor people, the rents for those places run 3-6K per month. The developers are buying up affordable older complexes and building unaffordable high end units serving the affluent tech crowd. Unclearl how my comment is a disservice to poor people. I know people who have had to move, apparently Prometheus has nothing in their price range.


Like this comment
Posted by MyOpinion
a resident of Sylvan Park
on Jul 10, 2018 at 6:27 pm

MyOpinion is a registered user.

These mega complexes serve the tech crowd as temporary housing, do you honestly think ANYONE who moved into a new Prometheus project made that their home for 20 or 30 years? Of course note, people want to live in a 'COMMUNITY' Mountain View is turning into a stop on the way to someplace nicer, not a destination. And as mentioned there are no Mountains and no Views in Mountain View. A misnomer, maybe Googleville?

And WHY is it mandatory that MV has to house every person working here?


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