Menlo Park council orders financial review after three developers pitch downtown housing plans

Menlo Park City Council held a June 2 study session to hear presentations from three development teams proposing to redevelop downtown parking plazas 1, 2 and 3 into mixed-income housing with replacement parking. After extended public comment and a round of council questions, the council unanimously directed staff to commission an independent financial analysis of all three proposals and return with funding options and updated timelines.

The presentations opened with Related California and Alta Housing, led by Ann Silverberg, who said the team’s proposal includes “346 affordable units, 154 market-rate units” and 556 parking spaces. Silverberg said the team plans to leverage 4% tax credits and state sources and described the proposal as flexible on unit counts and parking configuration depending on council direction.

Presidio Bay Ventures pitched a workforce-focused plan. John Maney of Presidio Bay described a three-plaza, phased project that would deliver 347 rent-restricted units targeted at 80%–120% of area median income (AMI) and a Phase 1 standalone parking garage that Presidio Bay said would have 455 stalls and a total of 814 stalls across the project, with 556 stalls intended to replace current public parking. Maney said the team is seeking a $15 million city contribution toward the garage and would convey the garage to the city on completion.

Alliant Communities emphasized deeper affordability and multi-phase delivery. Allison Levy and Steve Spielberg said their proposal spreads family and senior housing across the three plazas, with a large share of units at 30%–80% AMI and many at or below 60% AMI. Alliant described replacement parking distributed across sites and said it had modeled prevailing-wage assumptions for affordable phases.

Public comment reflected a mix of support and concern. Housing advocates and service providers urged prioritizing deeply affordable units and special-needs households; Gia Pham of Housing Choices noted there are local residents with intellectual and developmental disabilities who need homes. Will Esler, speaking as a resident, said, “Housing is a fundamental human need,” and urged the council to clear roadblocks. Business owners and downtown property stakeholders raised parking, traffic and business-impact concerns and asked how parking would be replaced and funded. One commenter, Sherry Zozlowski, urged the council to pause pending an upcoming ballot initiative, and Rob Solano alleged inaccuracies in one developer’s prior presentation regarding fire-department signoff.

Councilmembers focused the Q&A on eight topics: affordability mix and alignment with city goals; general financial feasibility; community engagement; parking funding and delivery; construction impacts and business support; labor and prevailing-wage assumptions; parking design and utilization; and tenant prioritization. Developers repeatedly said they are willing to adjust affordability mixes within financing constraints and described different financing paths:

- Related/Alta said their proposal follows the RFP’s 30%–80% AMI framework for the deeply affordable component, supplemented with some market-rate units to help close the financing gap, and that rents are generally set by AMI-based formulas (typically 30% of AMI). Ann Silverberg noted the practical limits of very tight rent caps, saying underwriting normally allows some households to pay slightly more than 30% of income when incomes fall below the unit’s maximum thresholds.

- Presidio Bay described a workforce approach aimed at first responders, teachers and healthcare workers at 80%–120% AMI, and said its pro forma assumes a $15 million city subsidy for an early-delivered garage and relies on a mix of private financing and public tools. Maney said the Phase 1 garage would be delivered before most residential occupancy to maintain public parking supply.

- Alliant said it had modeled tax-credit financing, prevailing-wage assumptions on the affordable phases, and a mix of county/state/federal funding and repayment mechanisms such as land loans or residual-receipt structures where applicable.

Developers also outlined operational ideas for construction mitigation and business continuity: phased sequencing so only one plaza is under construction at a time, look-ahead schedules, dedicated community liaisons, signage and delivery plans, and individualized outreach to merchants. All teams committed to robust community engagement—small-group meetings, bilingual materials, websites and frequent updates—and to meeting with labor representatives about prevailing-wage expectations.

On parking funding, the teams diverged in publicly stated expectations. Presidio Bay said it had budgeted a $15 million city contribution and would convey the garage to the city; Related described a higher overall garage estimate (Related noted an approximate $26 million figure for a consolidated garage in the discussion) and said its package might include a $7.5 million developer contribution plus grants and other sources. Developers disagreed about tax-credit rules for including parking in basis; they characterized the difference as technical and said they would work with counsel and staff to resolve the accounting and funding approach.

The council’s near-term direction was procedural. After hearing the presentations, the public and extensive Q&A, councilmembers voted unanimously to request that staff: (1) obtain updated financial materials from each developer, (2) engage a qualified consultant to prepare an independent financial analysis of all three proposals using those updated materials, and (3) return to council with the analysis plus a menu of funding options for any city contribution (staff estimated a best-case return in October, but cautioned that the schedule could slip). Mayor Betsy Nash and councilmembers emphasized timing and uncertainty—especially the potential effect of an upcoming ballot initiative and litigation—among the project’s principal risks.

Next steps: staff will seek updated pro formas from the three teams and solicit bids from consultants, then present the consultant’s financial review and funding-option menu to the council. No final selection or binding city commitment to any team was made at the June 2 study session.