Menlo Park unveils timeline for housing on downtown parking lots

Facing a proposed ballot measure that could block efforts to add more housing, the Menlo Park City Council on Tuesday laid out a timeline to advance a downtown parking lot development project of mostly affordable units.

For the first time, city staff presented to the public a clear path for advancing the housing project, even as a November citizens initiative that could require voter approval for any future reductions in downtown parking threatens to derail it — a point of contention between councilmembers during the meeting.

Since discussions began more than a year ago, redevelopment of three downtown parking plazas has been a divisive issue in Menlo Park, located in San Mateo County, which is consistently ranked among the most expensive housing markets in the country.

Although the agenda item was presented as an informational update, Councilmember Drew Combs argued that by asking staff to prepare reports and recommend a preferred developer, the council was effectively making a decision “through the back door” before voters could weigh in on the November referendum.

“I generally am opposed to the idea of council giving direction on a particular proposal before the referendum,” Combs said. “I think, at the end of the day, the referendum will pause the process.”

Mayor Betsy Nash acknowledged the risk but said moving forward allows residents to become better informed.

“I think it’s very important for us to continue on this path, fully realizing that any decision by the voters will certainly impact the project,” Nash said. “If the referendum passes, then absolutely the city will need to backtrack. But I believe there are a lot of reasons to move forward.”

The plan has sparked debate over the potential loss of hundreds of parking spaces. Opponents say removing parking, even temporarily during construction, would hurt longtime businesses and discourage visitors, while housing advocates argue that redevelopment is essential to addressing Menlo Park’s housing shortage.

Under the proposed schedule, the city would host a community open house next month, allowing residents to meet with representatives from each of the three developer teams.

In late March or early April, the teams will present their plans at a public City Council meeting. By April or May, the council is expected to select a preferred developer and proposal. Within 45 days of that selection, the council would hold a public meeting to adopt a resolution declaring the lots surplus land, clearing the way for development. The council would then vote in August or September on an exclusive negotiating agreement with the selected developer.

The November ballot could complicate the process if voters approve the measure requiring public approval for any reductions in downtown parking.

If the measure does not pass with a simple majority, Menlo Park’s Planning Commission is expected to hold hearings in late 2026 or early 2027 to review whether the project conforms to the city’s general plan. This would be followed by a final City Council vote in early to mid-2027 to approve the binding development agreement and greenlight construction.

The three developers previously presented proposals that vary in size and target residents’ income levels. Alliant Communities proposes 345 fully affordable units aimed at low-income residents, including some of the city’s lowest earners, with rents geared toward individuals earning roughly $41,000 to $110,000 annually. One downtown site would be reserved for senior housing.

Presidio Bay Ventures proposes 347 units targeting mostly middle- and upper-middle-income residents. Its “workforce housing” would be affordable to individuals earning about $110,000 to $157,000 a year, reflecting the salaries of teachers, nurses, police officers and other essential workers increasingly priced out of Menlo Park.

Related California and Alta Housing propose the largest project, with 500 apartments. About 346 units would serve very low- and low-income residents, including family and senior housing, while the remaining 154 units would be rented at market rates. Income limits would vary by household size.

Local business owners and housing advocates expressed different views during the meeting.

Tony Draeger, owner of a downtown supermarket, urged the council to delay decisions until after the ballot measure.

“I ask you to put off any of these decisions on these parking lots until that election is held and the people speak,” Draeger said. “Maybe we’ll want developments in those parking lots, but maybe not. But your job is to let them speak and not to try to do something ahead of time to prevent the process.”

Karen Grove of Menlo Together, an organization supporting the housing project, said residents are eager to further review the plans at the open house.

“I really appreciate that we are moving forward with the proposal to build hundreds of deeply affordable homes on our downtown surface parking lots,” Grove said. “While also improving downtown parking, pedestrian and bike access, and beautifying it with little parklets and paseos.”

Opponents, led by Save Downtown Menlo, a coalition of downtown Menlo Park businesses and patrons, argue that other sites would be better suited for high-density development, pointing to locations such as the Bohannon Industrial Park and the SRI/Parkline Corporation Yard. Supporters counter that the city must develop as many sites as quickly as possible to meet the demand for affordable housing.

Menlo Park is required under its state-mandated plan to approve nearly 3,000 new homes by 2031, including more than 1,600 affordable units.