Developer Plans 380-Apartment Complex at Palo Alto Fish Market Site, Utilizes Controversial “Builder’s Remedy” Law to Bypass City Objections
Acclaim Companies, a prominent developer, has recently proposed a bold plan to demolish The Fish Market restaurant in Palo Alto and construct a towering 380-apartment complex. However, the project faces significant challenges, as it exceeds the city’s 50-foot height limit, reaching a substantial 84 feet across seven stories. To surmount the city’s objections and expedite the approval process, Acclaim is turning to two controversial state housing laws.
The first law in play is the Density Bonus Law, allowing developers to claim increased height and density, along with exceptions to various development standards for residential projects. The second is Senate Bill 330, which streamlines the approval process for housing developments and prevents cities from changing design rules after applications are submitted.
Notably, Acclaim is leveraging California’s “builder’s remedy” provision, which comes into effect when cities lack a certified Housing Element. This provision empowers developers to pursue projects that surpass local zoning regulations. While Palo Alto’s City Council approved the city’s Housing Element in May, the document awaits certification from the state Department of Housing and Community Development, expected later this month.
This approach is not unique to Acclaim; other developers in Palo Alto have also turned to the “builder’s remedy” law. In April, Roger Fields successfully utilized it for a 45-condominium development at 400 Lambert Ave. Following suit in June, Juno Realty Partners and Far Western Land and Investment Company applied it to their 350-apartment project at 3997 Fabian Way. Just last month, developer Oxford Capital submitted a builder’s remedy application for the Creekside Inn site in the Barron Park neighborhood, facing criticism during the initial proposal under a more conventional zoning process. The new project includes 185 apartments, a renovation of three hotel buildings with 63 rooms, and a new hotel building with 137 rooms.
Developers Eye Transforming Palo Alto’s El Camino Real into Residential Hub, Including Controversial 380-Apartment Complex
The transformation of Palo Alto’s El Camino Real into a major residential hub is gaining momentum with ambitious proposals from developers. One notable project, spearheaded by Acclaim Companies, aims to construct a massive 380-apartment complex at 3150 El Camino Real, just south of the Palo Alto Square business complex. However, the proposal faces scrutiny as it relies on the controversial “builder’s remedy” provision to overcome height and density limitations.
The site, which spans 2.55 acres, is strategically located one block south of another proposed Acclaim development and across the street from an upcoming 129-apartment complex for low-income residents led by Charities Housing. Also neighboring is a 16-condominium project by Dividend Homes at 420 Acacia Ave.
Acclaim’s new proposal stands as the largest builder’s remedy project under review in Palo Alto. The seven-story building, rising to 84 feet, would feature an interior courtyard with amenities such as a swimming pool and a clubroom. Along the El Camino Real frontage, Acclaim plans to include a leasing office, co-working space, a fitness area, and a “bike café.”
Notably, the company has adjusted the project to meet builder’s remedy requirements, designating 20% of the apartments, or 76 units, as below-market-rate dwellings to cater to affordable housing needs.
The fervor to transform the area extends beyond Palo Alto, with neighboring Los Altos Hills and Menlo Park also receiving ambitious proposals invoking the builder’s remedy provision. Menlo Park’s project, proposed by N17 at 80 Willow Road, aims to create a 300-foot-tall mixed-use development at the former headquarters of Sunset Magazine.
As these developments unfold, the fate of the Fish Market restaurant at 3150 El Camino Real hangs in the balance. With the city’s emphasis on expanding residential construction, the once-familiar landscape along El Camino Real may soon undergo a significant transformation.
In a letter to the city, Acclaim’s attorneys Tamsen Plume and Genna Yarkin of the firm Holland & Knight indicated that the new proposal is an alternative to the one that the developer had proposed in June and that is being reviewed by city planners.
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Acclaim’s attorneys have cited a letter from the city, asserting that the initial project, even with the use of the state’s Density Bonus Law, is not permitted at its proposed density. In response to the uncertainty surrounding the city’s support for the project, the attorneys have submitted a preliminary SB 330 application for a “Builder’s Remedy Alternative” while still maintaining their pending application for the original project.
According to Plume and Yarkin, the new application qualifies for the builder’s remedy because 20% of the apartments are reserved for low-income units. They also pointed out that since the city lacks a substantially compliant Housing Element, the Builder’s Remedy Alternative is not required to adhere to General Plan or zoning standards.
Acclaim’s decision to pursue this alternative route aims to safeguard its ability to construct a financially viable project amid concerns about the city’s support for the initial proposal. The attorneys are currently reviewing the city’s letter and plan to engage in discussions with the city attorney’s office to address the project’s future.