Staff reports modest retail openings and a continued jobs–housing imbalance in Palo Alto

Economic development staff presented the June economic activity report, highlighting Q1 2026 retail property metrics, notable openings/closings, and updated employment figures drawn from state EDD data.

Retail: Staff reported an increase in average asking rents for downtown University Avenue compared with a year earlier and modest changes in vacancy rates; recent openings include several restaurants and food-service businesses. Staff also flagged a Provident Credit Union branch closure on California Avenue.

Employment and jobs–housing balance: Staff noted that Palo Alto’s total employment remains below pre-pandemic levels: about 100,000 jobs today compared with roughly 105,000 before the pandemic. Work-from-home figures have declined from a pandemic peak (roughly 15,000) toward about 8,000 jobs currently working remotely, which staff said supports local retail. Sector concentration remains high in health care, professional/scientific/technical services and information. Staff summarized that ongoing housing production under the housing element should improve but that Palo Alto will remain relatively jobs-rich for the foreseeable future.

Council asked several clarifying questions about data definitions (households vs. housing units), employer sizes, and potential impacts from large sites such as the VMware property; staff said lease activity is ongoing and that a substantial tenant could affect local job totals if a lease is finalized.

Ending: Staff will provide requested numeric clarifications and follow-ups in subsequent reports.