Another opportunity for affordable housing Another opportunity for affordable housing (January 14, 2004)

A company seeking to develop the 3.5-acre Derry property at Oak Grove Avenue and the railroad tracks in downtown Menlo Park is meeting with the City Council this week to gauge whether the city would support a housing and retail project on this commercially zoned site.

A spokesman for the O'Brien Group told the Almanac last week that tentative plans include high-density, rather than single-family, homes on the parcel, with the possibility of some office space on Oak Grove. The current retail tenants on the site, including Foster's Freeze and Wo Sing Laundry and Dry Cleaners, could possibly be worked into the project as well, the spokesman said.

For Menlo Park, the suggestion of a high-density project is a perfect opportunity to entice the owner to build more affordable housing on this site than would be required by city law. The land is virtually surrounded by commercial property, meaning that the usual objections from nearby single-family homeowners might not be much of a factor. In return for permitting a small amount of office and retail space, the city could ask the developer to design a project with a few additional units that could be priced in the affordable range, which for Menlo Park is in the neighborhood of $500,000 per unit.

The city had that opportunity in Linfield Oaks just over a year ago, when Olive Hill Development offered plans for 62 town homes on 3.3 acres, or a density of 18.8 homes per acre. But after meeting with neighbors and hearing objections about traffic and other impacts, Olive Hill changed course and decided to expand the project to 5.4 acres but at 10.6 detached homes per acre, a much lower density. The detached homes will sell for approximately $1 million each, while Olive Hill estimated the town homes would have gone for $800,000 each.

If the developer of the Derry property were to build at a density of 18 units per acre, 60 homes would fit on the site, although retail and office uses might reduce that number.

Building high-density housing downtown is becoming a much more attractive proposition than in prior years, when developers were focused almost exclusively on office buildings. But with today's housing crunch, and the glut of commercial office space on the market, housing is looking much better. Now city planners heartily support housing built near transportation corridors and other services. In fact, such housing often can benefit the downtown shops and restaurants that are within walking distance.

And although the Menlo Square project across the street from the Derry site was not designed as an affordable project (it does contain the required number of below market rate units), it certainly could be a bellwether that might attract other higher-density projects that could rejuvenate Menlo Park's downtown core for years to come.

Let's hope the City Council can find a way to make affordable housing downtown a worthwhile endeavor for the developer. Such a project could answer a portion of the city's need to approve new housing sites, and provide a shot in the arm for downtown businesses as well.

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