For better or worse, Menlo Park's slice of El Camino Real will never be the same.

With the approval of nearly 430,000 square feet of new development on Stanford-owned land along El Camino Real in Menlo Park, there'll be a lot more happening there once the former car lots – which many drivers have come to know intimately while grinding through gridlock – are replaced with offices, housing and retail in buildings up to 60 feet high.

After nearly five years of Menlo Park scrutiny, Stanford University received unanimous preliminary approval Sept. 26 from the Menlo Park City Council to build an office, housing and retail complex at 500 El Camino Real. (Final approval of the complex, which the university is calling "Middle Plaza," is expected to be given at the council's Oct. 10 meeting.)

The council approved a package of resolutions and ordinances to allow the university to move forward with its project, the second major development near the city's downtown heart that the council has approved this year. The first, a roughly 420,000-square-foot mixed-use development by Greenheart Land Co. at 1300 El Camino Real in the city's northern stretch, formally broke ground Sept. 12.

Combined, the two complexes will add about 850,000 square feet of development, and an estimated 950 residents, 1,200 employees and 6,400 daily vehicle trips. These two projects also take up 58 percent of the housing and 47 percent of the commercial space the city allows in its El Camino Real/downtown specific plan.

The project

Stanford University, which first submitted its plans for the 8.4-acre site in November 2012, proposes to build 142,800 square feet of office space, 215 apartments and 10,000 square feet of retail space. About half – 52 percent – of the apartments will be two-bedroom units, and the rest, one-bedroom.

A publicly accessible plaza features prominently in the project's design. According to project architect Tom Gilman of DES Architects + Engineers, there will be a fountain in the plaza.

The three- to five-story buildings will range in height from 38 to 60 feet, with the tallest ones closest to the Caltrain tracks.

John Arrillaga has offered to build the office buildings, according to Jean McCown, Stanford associate vice president of government relations.

Studies estimated that the development would generate an additional 2,658 vehicle trips per day, lower than the number approved in the city's El Camino Real/downtown specific plan.

Construction will take about three years, with the office buildings expected to be completed before the residential buildings, according to Ms. McCown.

Community response

With both projects, there have been similar expressions of excitement and concern from the community. Some people await the developments with anticipation, seeing the addition of residents and workers near the Caltrain station as a way to boost both public transit and downtown vitality, and remove an embarrassing stretch of blight.

Others express worry that the "village character" of Menlo Park is destined to become a thing of the past, although Stanford officials point out they've redrawn the plans a number of times to better accommodate the local aesthetic.

A big question: What will be the impact of an additional 6,400 vehicle trips a day coming from these two developments?" There's still not a clear answer, but the university will have to pay about $958,000 to cover the development's impacts on city roadways.

In the days before the council gave preliminary approval, the council's inbox received more than 150 emails from locals opposing the terms of a development agreement and urging the city to take a tougher negotiation stance.

Since Stanford's project meets requirements in the city's specific plan, however, the university wasn't required to negotiate with the city. Instead, the negotiations were an effort to nail down what Stanford meant by making a "significant contribution" to a bicycle and pedestrian grade separation – a tunnel under or a bridge over the Caltrain tracks – at Middle Avenue.

The agreement

The result of the negotiations was that Stanford agreed to pay half the cost, up to $5 million, of the bicycle and pedestrian grade separation, and to donate $1.5 million in a lump sum to the Menlo Park-Atherton Education Foundation, which supports the Menlo Park City School District. (This payment is to compensate the district since children who reside in the Stanford apartments may go to district schools, but those apartments are exempt from property taxes the district depends on. The exemption is due to the fact that the apartments will be occupied by Stanford faculty and staff.)

If Stanford's share of the grade-separation cost is less than $5 million, the difference would be paid to the foundation up to an additional $1 million.

Council members agreed to decide later whether that contribution should be further cemented so that Stanford would commit $4 million toward the grade separation and give $2.5 million to the education foundation.

That the grade separation will come in below $10 million seems unlikely. Some estimates have ranged as high as $17 million. Council members agreed that the city could seek grant funding, and Ms. McCown said the university could add its name to city grant applications.

Some observers have expressed doubt that Stanford's commitment was sufficient. Former planning commissioner John Kadvany pointed out that without the bicycle and pedestrian crossing, the office and residential tenants will be stuck on the west side of the tracks and will have to go around the development all the way to Ravenswood Avenue to access the Civic Center. The grade separation is an added value to those tenants and Stanford, he noted.

School district

The tax-exempt status of the apartments, which is more than half of the complex, is a major concern of the Menlo Park City School District. Any building the university claims is being used for its academic purposes, including housing its faculty and staff, is exempt from property taxes.

School district officials estimated that the development could add up to 39 students to its schools at an annual cost of more than $600,000 a year.

Ahmad Sheikholeslami, the district's chief business officer, said that if Stanford contributes $2.5 million to the foundation and there are strong property tax revenues from Stanford's new office buildings, about 60 percent of that cost could be recovered.

Steve Elliott, Stanford's managing director of development, said the university expects far fewer children to live there.

In many emails sent to the council, people called for more compensation by Stanford. They argued that other universities like Harvard and Yale, pay in-lieu fees to their host cities to cover the costs they generate.

In response, Stanford officials noted that the university has a number of for-profit properties that generate substantial property taxes for Menlo Park that other universities may not have. According to Mr. Elliott, between the Rosewood Sand Hill and Stanford Park hotels and its other properties in Menlo Park, Stanford pays upwards of $9 million in property taxes annually.

Transportation

To reduce the number of potential car trips that will start or end at the development, Stanford officials say the development will offer: a bike-share program for employees and residents, showers and lockers to encourage people to commute by bike or foot, car-share vehicles, a web portal to encourage carpooling, and a guaranteed ride home program for employees, among other actions.

Diane Bailey and Janelle London from Menlo Spark, a Menlo Park-based environmental nonprofit, said the university should also require paid parking (to discourage driving) and require employers at the development's offices to enroll in Caltrain's Go Pass program, which gives employees free Caltrain passes.

John Donohoe, Stanford director of planning and entitlements, responded to the former request by explaining that "people are cheap" and would most likely just park in nearby neighborhoods rather than pay. To the latter request, Ms. McCown said, the employers should be able to decide how best to cut car trips for their employees.

The Go Passes aren't precluded from being purchased by future office tenants later on, though. The Stanford development will be equidistant between the Menlo Park and Palo Alto Caltrain stops.

Environment

The university made several last-minute concessions during council negotiations, agreeing to purchase 100 percent renewable energy, to design the development to meet LEED Gold requirements – a more stringent sustainability standard than the university had previously committed to providing – and, following a request by Mayor Kirsten Keith, to use natural, rather than fake turf at the on-site dog park planned at the development.

Housing

The university will provide 10 one-bedroom "below market rate" apartments to the city to be rented out to low-income tenants. The city administers the below market rate housing program and is expected to dedicate five of the apartments to qualifying teachers in the Menlo Park City School District.

__