Palo Alto council hears prescreenings for two San Antonio Road housing projects; no formal decisions

City of Palo Alto planners and two developers presented prescreenings on May 19 for projects at 788 and 800 San Antonio Road that would rezone parcels to allow denser housing, and council members used the session to give early feedback but made no formal decisions.

The presentations opened with Jonathan Lake, director of planning and development services, and senior planner Emily Callas describing the process and key differences between the current entitlements and the proposed projects. Callas said the prescreening “is required for proposed legislative changes, including rezonings” and emphasized that “no formal decision is being made tonight.” The larger of the two proposals would seek Planned Home Zoning (PHZ) and replace an earlier entitlement that allowed ownership condominiums.

The first applicant, represented by Megan Watson of Grubb Properties, described an eight‑story rental project with above‑grade parking and a reduced parking ratio compared with the prior entitlement. “We are a national multifamily developer owner operator,” Watson said. “We intentionally are not a luxury developer. We are specifically focused on trying to provide housing for the missing middle.” She told council that rising construction costs, higher interest rates and park impact fees had affected feasibility and driven the design changes.

Speakers from labor and community groups urged conditions or changes. Jaime Vasquez, a field representative for Carpenters Local 405, asked council to “prioritize labor standards” and support apprenticeships and local hiring on large developments. Public commenters from the neighborhood and housing advocates described the projects as critical to the city’s housing pipeline but pressed for more family‑sized units, retail, and transportation‑oriented design.

Council members pressed the applicants and staff on several recurring themes: building height and stepbacks, parking ratios and Transportation Demand Management (TDM) commitments, below‑grade versus podium parking costs, the distribution and form of Below‑Market‑Rate (BMR) units under PHZ rules, loading and service vehicle staging, and the relationship of the projects to the forthcoming San Antonio Coordinated Area Plan. Council Member Stone asked for clarity on how increased unit counts would be handled for RHNA when permits are issued; Callas said new units would count “upon the building permit being issued.” Several members, including Council Member Lue and Council Member Liu, urged stepbacks or varied massing so taller facades do not create canyon effects on San Antonio Road.

Staff repeatedly reminded council that PHZ requires a 20% inclusionary housing commitment but noted multiple distribution options for income bands and potential off‑site mitigation options. Callas said: “There is a requirement for 20% inclusionary as a part of the PHZ. The applicant would have to meet that standard.” Applicants indicated a willingness to comply with PHZ requirements but said pro forma and financing conditions could affect unit mix and whether the project would be rental or ownership.

Council members also encouraged applicants to continue coordinating with staff on traffic, right‑of‑way improvements and the San Antonio plan so that future multimodal facilities and neighborhood commercial services are preserved. Several members urged the developers to discuss labor standards with unions and to provide stronger, concrete TDM commitments if parking is reduced.

The prescreenings were informational; no land‑use approvals or binding commitments were made. Staff told council any formal applications returning under PHZ would go through the standard review process, at which point formal public hearings and required environmental and design reviews would occur.