‘A Failing Street’: As Vacant Housing Plagues California Avenue, Can the Shopping District Make a Comeback? | New


In recent years, empty storefronts and “For Rent” signs have become a common feature along the California Avenue shopping district in Palo Alto. As of this week, there were at least 13 storefronts that were vacant or for rent.

And as buildings sit empty and the number of attractions along the avenue dwindles, business owners and property managers who have maintained a deadlock stake for decades are now wondering if the second hub – city of the city will one day be able to return.

Jessica Roth, owner of The Cobblery, which has been operating on California Avenue since 1940, said it was the highest number of vacancies since taking over her grandfather’s shoe repair in 1994.

“In my entire life, we’ve never had more than three empty spaces on this street,” said Roth, who is also vice president of the California Avenue Area Development Association, a street business advocacy group. shopping. “California Avenue is known for its longevity and its businesses.”

Jon Goldman, co-president of Premier Properties, which manages more than 70 buildings in Palo Alto, said, “The neighborhood is falling apart.

During the pandemic, longtime restaurants such as The Counter, Antonio’s Nut House and even the Subway franchise abandoned the once bustling destination of Palo Alto, with business owners citing financial difficulties or employee shortages due to the pandemic.

“COVID-19 has affected us a lot,” Amanda Lee, co-owner of several subways in Palo Alto since 2003, told The Weekly. “The rent is very high in Palo Alto, and we have lost a lot of employees during COVID.”

Bank of the West is also expected to move out of its longtime home at 414 S. California Ave. by early 2022, leaving behind top-notch real estate and a big question mark over who will take over the building. (Redwood City’s Arton Management Investments, which owns the Palo Alto property and several others in Redwood City, declined to comment.)

According to LoopNet.com, a commercial real estate website, Bank of the West has occupied this 6,195 square foot space for more than two decades.

Lucas Grzeszczuk, the California Avenue branch manager, confirmed the move and said the branch was moving a few blocks near 2700 El Camino Real. He declined to reveal why the branch is moving.

In 2016, the Keeble & Shuchat photography store closed after 51 years in business, as the photography industry transformed and customers increasingly turned to online shopping. That, added to the scarcity of parking and growing development in the California Avenue area, made the closure necessary, owner Terry Shuchat said at the time. Parts of the large corner building remain vacant and available for rental.

Last year, Antonio’s Nut House, a popular local dive bar, closed after 49 years due to pandemic restrictions on bars and an impending lease expiration date held by the late Tony Montooth , the original owner of the bar. The building is currently being emptied and a lease sign is in the window.

“We are losing a lot of money. It is just too difficult to comply with all the regulations and maintain our prices,” Jess Montooth, Tony’s son, told The Weekly.

Additionally, 440 S. California Ave., the longtime headquarters of Country Sun Natural Foods, went on sale for $ 6 million on LoopNet in October.

A person related to the grocery market, who spoke on condition of anonymity, stressed that anything relating to a sale remains tentative.

“Country Sun is not moving,” the person said. “We have no idea whether (the property) is going to be sold or not. Even if it is sold, (the store) will not budge.”

The city has taken steps to support local businesses in the shopping district during the pandemic – including temporarily closing California Avenue to traffic to allow restaurants to serve meals on the streets as health demands restrict eating inside. In September, the council voted to extend the popular street food program until at least next June.

“Overall, the city has made an effort to help promote commercial and similar uses on California Avenue,” Meghan Horrigan-Taylor, city communications manager, wrote in an email. “The council also worked during the pandemic to reflect on the role of street closures in supporting the community and supporting local businesses. “

The city council is expected to discuss longer-term closures on November 15, she added.

But some retailers say the benefits of the program are not shared among all businesses on a restaurant-dominated street.

As a retail store that relies on impulse visits, Roth believes the street closure continues to negatively impact his business.

“Retailing is a really fun thing where sometimes you just don’t know you want something until you see it,” she said. “And walking in the middle of the street, you are not going to see my store.”

However, Roth said she understood the purpose of the shutdown and ultimately supported the cause because it had helped restaurants during the economic crisis. But in winter, when it is colder to eat outside, she wonders if closing the street will be useful.

As someone who has sounded the alarm bells for several years in the city about California Avenue, Goldman said businesses are not loudly clamoring for vacant spaces in the shopping district.

But the avenue will soon welcome some new arrivals.

Recently, Goldman’s Premier Properties, which currently lists five outlets on California Avenue available for rent on its website, helped secure retail space for Nob Hill Hardware at 251 California Ave., next to FedExOffice. While this is an exciting opportunity to add commercial use to the street, Goldman said the level of licensing and inspection the company had to undergo for a 3,144 square foot space has been “brutal”.

“This construction has been going on for over a year and a half (…) and they are not building anything,” he said.

In addition, the Boba Ume Tea store is preparing to move into the former Subway site at 421 S. California Ave. And Local Kitchens, which describes itself as a “digital dining hall” focused on food delivery service applications, is set to take over The Counter’s former location in November. Customers can order from a variety of restaurants and pick up their food on site; there are no seats for dinner.

“We couldn’t be more excited to bring our micro-dining room to California Avenue, which will feature a mix of incredible Bay Area restaurants including Señor Sisig, Wise Sons Deli and The Melt,” Jon wrote. Goldsmith, CEO of Local Kitchens. an email. “Customer response has been tremendous since launching our first store last year, and we are delighted to serve Palo Altans with convenient and diverse dining options. “

Besides these new retailers, however, businesses considering relocating to the avenue face difficult conditions – some of which predate the pandemic, the retailers said.

Property managers and business owners who spoke to The Weekly highlighted what they saw as questionable policy decisions made by the city in recent years that have only made it harder to operate. a business and attract new volunteer arrivals.

Roth of The Cobblery, for example, pointed to an ordinance she ironically backed by collecting petition signatures for its implementation: the “retail formula” policy passed in 2015, which bans chains over of 10 locations to settle on California Avenue. The law provided exceptions for Benjamin Moore Paints, The Counter, FedEx, Starbucks and Subway, which were already operating on the streets at the time.

“This is one of the things that maybe needs to be reviewed,” Roth said.

Mike Meffert, a commercial real estate agent for Alhouse Deaton who has worked on the peninsula for 20 years and also owns an office building at 480 S. California Ave., agreed that the formula retail policy is among the hurdles that could deter businesses that may have the ability to increase foot traffic on the street.

“As far as I know, other cities (with inner city neighborhoods) don’t have this retail restriction formula,” he said. “I think it’s pretty unique.”

More recently, the city passed new parking policies that frustrated business owners and felt left out of the conversation when changes were discussed.

On October 5, the city agreed to increase the cost of parking permits for its public garages and to end its on-street parking permit program in the residential areas of Evergreen Park and Mayfield, on which district employees of California Avenue count for parking.

The city expects cars to leave neighborhood streets into the new 626-space garage at 350 Sherman Avenue and has ensured the structure is large enough to support the approximately 250 vehicles currently using the program. street parking permit.

Michael Ekwall, owner of La Bodeguita del Medio at 463 California Ave., believes the new parking policies are a blow to the business district, especially as the restaurant industry continues to struggle with a shortage of parking. ’employees.

“When we have an employee who can’t find a parking lot, they just don’t work for us,” Ekwall said. “We are currently in a very difficult position in terms of being able to fully staff our business and when our employees cannot obtain parking permits it only makes matters worse.”

Ekwall said removing the residential parking program and increasing the cost of garage permits is a step backwards. He is not convinced that the garage will provide enough space to accommodate all employees in the business district.

Meffert and Goldman echoed Ekwall’s sentiment, saying adding parking restrictions in neighborhoods makes it harder for businesses to operate.

“If you kill the parking lot, you also slowly kill the businesses,” Meffert said.