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What do you think of the new Derry project?

Original post made by Rory Brown, Almanac staff writer, on Jun 5, 2007

A compromise has been reached on the Derry condo-commercial project by the O'Brien Group, the project developer; and Menlo Park Tomorrow, the residents group who led a referendum against the original project.

The new project reduces the number of condos from 135 (or 50 condos per acre) to 108 (or 40 condos per acre); the height is reduced from 50 feet to 40 feet; the number of below-market-rate homes in the project is reduced from 22 to 16; and the amount of commercial space is increased from 22,525 square feet to 24,925 square feet.

The new project also includes plans for a 3,500-square-foot plaza, and an extra $2 million payment to the city.

What do you think? Is the new project too similar to the old project? Too different? Should Menlo Park residents get a vote on the original project (what was pushed during the referendum campaign)?

Read the Almanac's latest story here: Web Link

Comments (26)

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Posted by Resident
a resident of Menlo Park: Fair Oaks
on Jun 5, 2007 at 10:59 pm

I would like to thank Mayor Brown for his work on this project. I look forward to his continued governeance of our city. I hope to vote for him again in the next election.

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Posted by Fatso
a resident of Menlo Park: other
on Jun 6, 2007 at 5:44 am

Save Foster's Freeze ... provide them retail space in the new development at the same rate they pay today.

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Posted by Council watch2
a resident of Menlo Park: Felton Gables
on Jun 6, 2007 at 2:32 pm

In addition to Mayor Brown's control of the city, let's give credit also to council member Paul Collacchi who despite his moving to Redwood City 2 years ago, has a firm grip on the current council's thought process and votes. Talk about a secret government! Didn't Mr. Cline's election platform include promises of an open government in MP? Come on Cline: Try your hand with leadership!

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Posted by Rich Cline
a resident of Menlo Park: Central Menlo Park
on Jun 6, 2007 at 8:34 pm

CouncilWatch2 - Thanks for keeping me honest. I did campaign on open government and I stand firmly behind that. I watched this process very closely to be sure. In the instance of a referendum, the sponsoring party represents its cause. Menlo Park did not fund this referendum. Mr. Brown did. The referendum is not a city sponsored item thereform it has no reflection on the city government. The two parties negotiated and brought the resulting negotiation forth to the council. It nows goes through the public process -- from application to commissions to council. While it is a unique process it was not in secret from what I know. If you have evidence that differs, I welcome that information.

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Posted by Council Watch 2
a resident of Menlo Park: Felton Gables
on Jun 6, 2007 at 9:51 pm

Mr. Cline:
Once Mr. Brown got the required signatures, the council had 2 choices. One was to place the issue on the ballot and the other was to rescind the council's approval of the project. Neither was done. It seems the council was in collusion with Mr. Brown et.al allowing the negotiations to go on for months and in secret. This was not a public process and the outcome benefited the city $2 million dollars. The private process invloved the City's interest and yet no council member participated. Did you send a staff employee or the City Attorney to these negotiation meetings and if so were there reports made back to the council?
There seems to be a very active and closed group that is allowed way too much power in the City's government.
Have we gone from one kind of a bad council to another kind of bad council? At least the last council did their own dirty work. This council has assigned powerful roles to certain people who put you on the council.

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Posted by Rich Cline
a resident of Menlo Park: Central Menlo Park
on Jun 6, 2007 at 11:51 pm

This is a very difficult forum to discuss in detail, but for sake of clarity I will try to give you more information. O'Brien waved the timeline for council to make a decision on the petition (I think it is 75 days) after the petition was verified. I believe that this council has been waiting to act on the petition results as a result of that waiver. We still have those two choices you mention.

I respect your concern and your frustration. Hope this helps.

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Posted by Council watch2
a resident of Menlo Park: Felton Gables
on Jun 7, 2007 at 10:11 am

Mr. Cline:
I don't need more information. Do not assume I am ignorant of how this deal proceeded. My question is how Mr. Brown and his team were allowed to negotiate on behalf of the City for the extortion of $2 million from the Derry Family. This is a dangerous precedent and one that will stick to this council and its rookie members. The approvals should have been rescinded as Mr. Robinson initially wanted and the City should have started over again,this time doing it right. No closed door meetings.
The damage is done and your council will live with this.

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Posted by Also Watching Councils
a resident of Menlo Park: Central Menlo Park
on Jun 7, 2007 at 11:01 am

What we really need is a plan for El Camino and soon, and for other parts of town, too! Then everyone would know what can be built and under what terms.
I was appalled with the previous Council's decisions related to the Derry project, allowing use of creative counting rules, allowing far more density than city rules permit, and then only asking for $100 thousand of "public benefit" despite $ millions of windfall profits to the developers and an environmental study that concluded there were not ways to avoid significant adverse impacts.
While the private negotiations between the parties to the referendum were not an ideal process, its results prove what is possible when the community's interests and developers' interests are balanced: A modified project that seems to conform better with city rules and brings impressive public benefit. It can now be built far earlier than under either of the scenarios (rescind or put to a vote). That is, if it is approved through the usual, public city processes.

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Posted by Pseudonyms Are Fun
a resident of Menlo Park: Belle Haven
on Jun 7, 2007 at 11:21 am

You invalidate yourself using words like extortion. You made some good points, Councilmember Cline answered, you don't like the answer.

Rich, you are crazy to have a public discussion with a pseudonym.

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Posted by Stuart Soffer
a resident of Menlo Park: Linfield Oaks
on Jun 7, 2007 at 2:45 pm

The most telling aspect, for me, of the Derry/O'Brien agreement is that this is a clear example of how poor a job the city does in negotiating major agreements. In effect the prior council left $2,000,000 on the table, ironically while asking the voters for a utility tax. Whether this is an institutional problem, or inexperience of council members in business, the end result is that it is too easy for the city to be shortchanged: it needs to do better.

If this agreement goes through, I hope the city puts those funds to that tangible benefits that we can all point to with pride.

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Posted by voice of reason
a resident of Menlo Park: Downtown
on Jun 7, 2007 at 2:56 pm

The real issue is that Mr. Brown and his team should have been more concerned prior to the original project being approved, as opposed to comming in at the last moment. This was a blatent attack on this project for political gain from the new canidates running for council, and their supporters. Menlo Park has the highest fees in the area for development, around $35,000 per unit. If the requirement for this project to be approved was and additional $2,000,000 on top of the already extensive development fees, then the word extortion might seem appropriate. The goal of the city council should be a succesful project, not providing additional funds for our elected representatives to waste. The city of menlo has numerous apartment and condos downtown, unfortunatly most of them were built 40 years ago and haven't been updated since. New housing will be a benefit to this city and it makes sense to put a dense development at this location near the train corridor.

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Posted by CouncilWatcher
a resident of Menlo Park: Sharon Heights
on Jun 7, 2007 at 11:11 pm

Voice of Reason [Portion removed by Almanac staff]:
"The goal of the city council should be a succesful project, not providing additional funds for our elected representatives to waste."

Well, the goal of the last council certainly seemed to be giving away as much money as possible to developers (roughly $2 million in the case of Derry), along with land (the Bayfront Golf Course proposal), while simultaneously trying to dump programs it didn't like (e.g., childcare) as well as trying to kick out as many city workers as possible, all in the name of "phantom deficits" created using Enron-type accounting tricks!

Given that, I'll take Mr. Brown and other private citizens stepping in any day to do the right thing!

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Posted by InquiringMind
a resident of Menlo Park: Central Menlo Park
on Jun 8, 2007 at 5:12 am

I'm astounded at $35,000 per unit in fees. Do you have the data for that?

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Posted by The deal became fair
a resident of Menlo Park: Central Menlo Park
on Jun 8, 2007 at 11:58 am

The referendum passed because the developer was effectively given $1 million of Menlo Park's money by the old City Council via relieving the developer of agreed upon fees at the last minute - FOR NO REASON and for no substitute benefit to Menlo Park!!! The revised outcome is a testament to how poorly the old City Council represented Menlo Park's interests: robbing millions of dollars from Menlo Park residents to the benefit of a special interest group is corrupt and/or incompetent politics; and we have enough of that happening at the national level...

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Posted by Kathleen Much
a resident of Menlo Park: University Heights
on Jun 8, 2007 at 12:19 pm

I favor the previous Derry Project, with more housing units where we need them--near Caltrain and within walking distance of downtown. I'm sorry the Nays brayed louder than the Yeas and cut the project back.

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Posted by Just another pseudonym
a resident of Menlo Park: other
on Jun 8, 2007 at 2:02 pm

Yes, let's cram as many people and cars onto El Camino as we can, thereby eliminating the possibility of that strip ever generating sales tax revenue.

If the developers truly believed that Derry was "transit-oriented" (the buzzword for "let's fool this council into handing over as many concessions as we can get") they would propose a development without garages or parking spaces. But they won't, because they realize that no one would buy the units without parking. They recognize the inherent contradictions of "transit orientation."

There are existing large and dense developments near mid-peninsula train stations. The staff reports will never show figures indicating what percentage of those residents take the train -- because most of them don't take the train.

That said, I am not crazy about the Derry process to date. The previous council clearly dropped the ball. The people who signed the petitions did so because they thought that the council would either rescind or put the project up to a vote. As suggested above, the protracted, secret negotiations that resulted did very little to support the credibility of the process.

Moreover, I am not impressed by the $2 million. Sure, it's better than zip, but it's a one-time fee that will do very little to mitigate the negative and longlasting impacts of this project.

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Posted by MP resident
a resident of Menlo Park: Downtown
on Jun 8, 2007 at 5:34 pm

I support infill housing development near transit -- within reason -- but I wonder who is going to want to live right next to train tracks? Walking distance to the train station is one thing, practically living on top of the tracks in quite another.

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Posted by True Environmentalist
a resident of Menlo Park: Linfield Oaks
on Jun 8, 2007 at 9:22 pm

Yes, Ms. Much and Just Another are right. If we want people out of their cars, we should approve real transit-oriented dense housing that has no garages. Sound extreme? Is there such a customer for this type of housing? Maybe we are just a community that is full of hot air. We love our cars and we use them every time we leave the house, even when we go exercise (i.e. drive to the foot of the Dish to Run?). Maybe when gasoline gets to $6 a gallon and we shed our cars, transit housing without garages will be in demand. In the meantime, let's prove our green values by reusing our paper bags when we grocery shop. That's about the extent of the sacrifice we are willing to make here, in Menlo Park.

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Posted by voice of reason
a resident of Menlo Park: Downtown
on Jun 8, 2007 at 9:27 pm

The way that opinions are tossed around as if they were facts in this forum is disturbing...

The city didn't give away any money to the developer, nor did they relieve the developer of agreed upon fees at the last minute. The $2,000,000 added fee that is part of the compromise was never "owed" to the city. It is above and beyond the regular fees that are required which were already over 3.5 million for the previously approved project per menlo park building codes. So now its over 5.5 million to the city just for the right to build the project.

Maybe this is why El Camino is a ghost town of abandonded auto lots...

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Posted by steve schmidt
a resident of Menlo Park: The Willows
on Jun 8, 2007 at 9:35 pm

When will we find out why $2M is more appropriate than $100K as a "mitigation" for this proposed development? Was is a calculation or just a number? Was it as much as the Derry developers were willing to pay to make these pesky activists go away?

If the current arrangement survives to a final vetting by the City Council, the $2M should be put into the City's Below Market Rate Housing Fund. After all, everyone bemoaned the loss of those 6 BMR units from the original to the more recent version of the project.

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Posted by Also Watching Councils
a resident of Menlo Park: Central Menlo Park
on Jun 9, 2007 at 7:05 am

Some of those posting opinions need to get some facts. I have spent some time trying to understand this situation. The city has long held a maximum density of 40 units per acre, but the maximum along the Caltrain tracks was 18.5 units per acre until the prior Council and staff allowed some creative math and allowed not just 40 units per acre but 50 for this project! And just because the developer asked! It takes a lot of reading to figure this out because the staff reports and public announcements didn't make it obvious. So why fault the citizens who finally figured this out "late" but still within the legal time period for comment? I think it's a lot more appropriate to put blame squarely on the city's leadership at the time (Mr. Bosh and the prior council).

For essentially giving away the value of the ability to build and sell lots of extra units and more commercial square footage also (roughly double the maximum allowed), the city was bestowing windfall profits on the developer and should reasonably expect the community to gain additional direct benefit for that. The prior council asked for $100,000, and the developer seems willing to give $2 million for 40 units per acre (not 50).

If you read the environmental study, it concludes - even though the project is "transit oriented" - that there will be significant adverse impacts that cannot be mitigated. These include increased traffic congestion as measured at key intersections.

I am deeply grateful for Mr. Brown and all the citizens who signed the petition and brought this to light. The city can, and should, do a lot better in its project reviews and negotiations.

Now, the city must do what is long overdue - create a plan so everyone knows what is allowed, where, and under what conditions. The prior Council rejected staff recommendations to do this for El Camino. The current Council and staff need to get moving!

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Posted by James
a resident of Menlo Park: Menlo Oaks
on Jun 9, 2007 at 4:48 pm

Since I was born here, The 'Derry' area has been a staple. The Laundry, the autoshop, Fosters Freeze, car wash are the few remaining examples of what "Menlo Park' is.

I still travel out of my way for a burger/fries/soda. It would be more than a loss to say the least to see these places vanish. I use to go to A & W's and get a 'brain' freeze from an ice cold root beer before they left years ago.

Johnny's Smoke shop was a place to hang out as well as make a quick market stop at "All American Market". Now all gone... never to be returned.

I understand progress...but to me, this is just taking the heart out of M.P. What would you say to losing the 1st 'Round Table Pizza'ever??? Remember, THEY started here! Or how about 'Su Hong's'?? I remember 5 tables plastic covered w/ a red/white checked board table cloth. The latter has qrown and grown... But I miss the quaint place the 'Su's' once was. It's an ICON

Money seems to be the motivation...who wants to live near a train depot?, I don't, I tried...it's terrible!

I hope that You DO NOT change the 'Derry' area

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Posted by Mary Gilles
a resident of Menlo Park: Central Menlo Park
on Jun 9, 2007 at 10:35 pm

I have mixed feelings about the Derry Project. I think the concept of high density housing that provides BMR units near transit corridors is probably a good thing from an environmental standpoint. On the other hand, I'm not sure if the residents even WANT more NEW housing in Menlo Park. New housing generally brings more traffic. Unavoidable. However, there used to be an argument which no one seems to be using now that if people who work in MP could afford to LIVE in our town, then they wouldn't have to be driving to and from MP to work. So would the traffic impact increase all that much if some of the folks who bought a Derry condo actually worked in MP? Depends on whether or not they STILL drive to work. By the time final permits are issued, it mostly likely will be at least one year delay from the original process. Anyone who follows construction costs knows that they rise as time goes on. Of course, that is a cost to the developer, not the City. The revitalization of El Camino is now a highly RISKY proposition for other developers to undertake. It will be interesting to see what action will occur on El Camino over the next few years, if any. Delaying the Derry Project with a referendum (however one viewed the project) has implications for future RE-development along the El Camino corridor. That corridor could be fantastic but if an individual who has money doesn't like a project, they can run a referendum against it and we're still stuck with eyesores of empty car dealerships. Also, given that the original project was projected to generate an incremental $1M per year of property taxes for our community (schools, city, fire district and more) this delay has cost us at least $1M -- and that's lost revenue for ever. The new project, with 20% fewer dwelling units and 12% overall reduction in space, will likely generate less on-going property tax. The recurring loss of property tax will probably be around 10-20% per year forever -- $100k - $200k per year forever. With 20% fewer dwelling units, the standard required fees (rec-in-lieu, school impact, and road impact, etc) will be reduced accordingly. The reduction in these fees to our City will be around $1M. Also, IMPORTANT TO NOTE - these fees would have been paid UP FRONT versus the new $2M public benefit fee which won't be paid until the units are sold (they have to be built first). That was money we would have been in the bank that we now won't have for years until the units are sold. So, was it all really worth it? Somehow the reduction of 10 feet in height seems so nominal when you're talking about a building that's already over 30 + feet high. Does anyone know how high the Kepler's building is? What's so terrible about that height? And, look at the wonderful benefit we have from that complex. I'm not sure the referendum and resulting secret negotiations will truly result in a better $$ deal for our City. But, the question still remains, do we want to build more NEW housing or not in our City? Are we going green with the regional concept of high density near transit corridors or not? Do the residents buy into this concept? Is it the responsibility of the elected officials to provide NEW high density housing? I believe this is the fundamental question.

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Posted by JESSIE
a resident of Menlo Park: Menlo Oaks
on Jun 9, 2007 at 11:43 pm

MS. Gillis:

I suggest you learn more about property taxes and where the money goes. The vast amount of property tax goes to the county. The City gets about 10% of collected property tax. I think somewhere I understood this was about a $100,000,000.00 property when fully built out. The property tax from that would be $1,000,000.00 (1% of assessed value), of which only $100,000.00 / year would go to the City. Please get your math right.

Apparently more than an individual wanted the project stopped. I believe from what I read almost 3000 Menlo Park citizens signed the referendum. Then you had an election in which the previous council majority of Winkler, DuBoc and Jellins were trounced. They spent well over twice (almost all funded from the development and realty community)of what the winning candidates of Robinson and Cline spent. They used the Derry project as one of their main themes. Can there be any doubt the project as approved was very un-popular?

Its hard to understand this argument that you cite, it being highly risky for developers to build projects in our town. We have a general plan and it seems that developers who adhere to existing zoning and the general plan build profitable projects. See Menlo Square, the new Beltramo project and others.

So write your long narratives, but please get your facts straight. After you formally announce your candidacy for Council, we will want to hear truthful and factual information.


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Posted by let's get real
a resident of Menlo Park: other
on Jun 10, 2007 at 8:42 am

Mary dear, one rationale for building those little boxes by the tracks is that we have a lot of people who work in Menlo Park and don't make huge amounts of money who commute into our city from as far away as the Central Valley. What a terrible commute, we say! But the big question is whether those people are going to sell their 4 bedroom/3 bath/swimming pool homes with yards and move their families into a 900 square foot place that costs twice as much. That one doesn't pass the straight face test.

Note also that homeowners do not typically pick up and move when they take a new job. Someone with a house in Mountain View and a job in Sunnyvale who gets a new job in Menlo Park is not going to sell the house. She knows, and so do we, that in a year or two she could be working in Palo Alto or San Mateo or wherever.

The gee-whiz-we-lost-a-lot-of-property-tax! argument also doesn't hold water. As JESSIE noted, not a lot of money is at stake here. Especially when you consider that Derry would (will) add hundreds of residents to our city, thereby increasing the need for police, fire, public works, and other staff, not to mention teachers and school facilities. Not only will that cost more than $100k/year at the outset, the costs for services will increase every year, whereas (thanks to Prop 13) the city's take from prop taxes will increase much more slowly. With each passing year, the city will experience greater deficits from Derry.

Dense housing is the most expensive use of land for a city.

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Posted by let's get real 2
a resident of Menlo Park: South of Seminary/Vintage Oaks
on Jun 10, 2007 at 6:48 pm

For a smaller project, the city and schools get lower fees because the impacts on them should be less. The demand for classroom seats will be forever less, the demand for city services will be forever less, the amount of precious water required will be forever less.

If the city gets around to trying to figure out where people who work here live, why not also look at where people who live here actually work? It's just plain too simplistic to think that everyone who works here wants to live here (as Let's Get Real pointed out) and that everyone who lives here works here, too. Just doesn't happen that way.

I am going to guess that most of Menlo Park's traffic is from people going through Menlo Park and the next highest source of traffic is from people who live here -- not people who commute to work here. It would be interesting to know.

New but related question: If more and denser units are built along the train tracks and the available transit magically improves to move those residents around, how will the transit that serves them help the rest of Menlo Park residents? Or should we expect that all the neighborhoods will be bulldozed and replaced with condos? The train system is making it very clear that Menlo Park is not a preferred site for its expansion. Service here has dropped significantly, requiring MP residents to commute in cars to other train stations, if they ride at all. So what "transit" should we expect here?

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