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By Diana Diamond

A lot can happen in one year — or — it isn’t what it used to be

Uploaded: Jan 27, 2021

I am amazed at how our lives have changed around the world because of one stupid virus, that keeps on morphing away so that it becomes more and more contagious.

I am also amazed at how COVID-19 has affected our local area — our priorities a year ago are certainly not our priorities today. Our concerns of yesterday may never be the concerns of tomorrow.

Two years go the build-build-build theme was loudly in play. Our city leaders said we
need more retail, less office, more affordable and below-market-rate housing, but we really still need to build more office space. And because so many are moving to this area, we have a real housing crisis.

That was then. I took a drive the other day around our downtowns and neighborhoods — so many things have changed.

On University Avenue and neighboring streets, many businesses are now gone, some forever — retail and restaurants, professional and personal services. Some are just closed during the pandemic — however long it may last, while rents are still due monthly. On Santa Cruz Avenue the same is true — I estimated at least 30 percent of the stores are shut.

One result is the loss of city revenues, resulting in a big problem. Traffic is lighter, office buildings are emptier, the downtowns are quiet, major companies, like Palantir and Tesla are moving out of state and hundreds of fingers are crossed hoping things will get better.

So many grand expansion plans are in jeopardy. On San Antonio Road, Marriott is building two fairly adjacent hotels, and there is another one on Ell Camino. Existing hotels are suffering. Can these new still-under-construction hotels make it, when long-standing hotels are fading?

I walked around the office complex at the end of Embarcadero Road near 101, where streams still flow through the well-landscaped properties and where now it seems that 90 percent of the offices are vacant. Yet one property manager I saw said the rental space was still a pricey $3.85 per square foot. Maybe the hyped prices are a hope-driven effort to keep steady the rental prices for the buildings. Personally, I’d rather have some rental money now than nothing.

And what will our cities look like in the future? Speculation is fun, and the following comments are only that — not a prediction.

Menlo Park’s downtown will probably survive — because the city is growing bigger and will be more populated. Drive by that huge development on El Camino’s east side, just north of Alma. It’s an immense undertaking of multi-story office buildings, lots of new retail space and hundreds of multi-family housing units. While retail rental may be difficult for a while, since this new project is competing with empty downtown stores on nearby Santa Cruz, there will be enough new tenants to take a calculated risk — I think.

Palo Alto’s downtown — well, I know University Avenue is still competing with Stanford Shopping Center (as is Menlo Park), but the shopping center has better skills at encouraging new stores to move in, especially if some of their mandatory 9-to-9 store hours become looser.

If companies continue to move out to Texas and elsewhere, Palo Alto may find its corporate offices disappearing. Palintir’s move will continue to have a big negative effect on Palo Alto’s downtown, since Palintir rented more than 25 percent of downtown space.

I see less traffic, more people working at home parts of the week, and a diminished draw downtown — it used to be vibrant morning, noon and night.

And a word of caution: With fewer dollars from corporations and retail, this city should watch where tis money is going today i.e., does the city really need a new Public Safety Building that will cost at least $96 million? And does this city really have to put in new bollards along University which can be moved from place to place to make the downtown more “flexible”? And is it necessary to spend money upgrading heating, ventilation and air conditioning systems at City Hall, or providing fiber to every home that wants it? Just asking.

Our local cities have now fallen into a deficit pit, and as the saying goes, don’t dig deeper and spend more now to get out of this coronavirus-caused hole.

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