Main120703 downtownhear tandsoul - reaching boiling point - los altos forward

1. Vibrant Downtown The Heart and Soul of America’s Communities Reaching the Boiling Point Presentation by Clifton Consulting Group Los Altos Forward July 11, 2012

2. 2 Vibrant Downtown Is Los Altos Dense? 1. Marked by compactness or crowding together of parts 2. Slow to understand 3. Having high or relatively high opacity

3. 3 Vibrant Downtown Who is the Clifton Consulting Group? • Ted & Jerry Sorensen • 30 year residents

4. 4 Vibrant Downtown Who is the Clifton Consulting Group? • Ted Sorensen • Attorney • 15+ years real estate development • Master Degree in Engineering • Transportation/economic planning

5. 5 Vibrant Downtown Who is the Clifton Consulting Group? • Jerry Sorensen • 25+ years real estate • Market Center management/development • Vibrant Buildings • Trade Shows • Management Consulting

6. 6 Vibrant Downtown • Why downtowns are important • Metrics for downtowns • Economic Levers • The Economic Model • Parking the key lever • Village Feel v. Mass & Bulk • Create Great Streets

7. 7 Vibrant Downtown Why our interest in Downtowns • Downtown Development Committee 3 • How many people? • How many more people? • How do you quantify?

8. 8 Vibrant Downtown • If you don’t know where you are! • If you don’t know where you’re going! Any Road will get you there!

9. 9 Vibrant Downtown “Doing the same thing over again and expecting different results.” - Albert Einstein's Definition of Insanity

10. 10 Vibrant Downtown • Redevelop Downtown • Revitalize Downtown • Reenergize Downtown Why is it Important?

11. 11 Vibrant Downtown What is Vibrancy? To be Vibrant • “Pulsating with life, vigor, or activity” • “She (the city) has a vibrant personality” • “New legislation to help small businesses and restore the vibrance of the local economy”

12. 12 Vibrant Downtown Why Downtowns are important! A Vibrant Downtown Could… • Increase retail/restaurant choices • Increase residential property values • Protect historic resources

13. 13 Vibrant Downtown Why Downtowns are important! • Pulse of a community • Community pride • Quality of life

14. 14 Vibrant Downtown Why Downtowns are important! • Attracts new businesses • Creates local jobs • Allows residents to work in town

15. 15 Vibrant Downtown Why Downtowns are important! Did you know? • $3 Million Annually to MVLA • $3 Million Annually to LASD • $900 parcel tax

16. 16 Vibrant Downtown Why Downtowns are important! Did you know? • $4 Million Annually to City $10 Million/yr incremental tax revenues! ―Is it time for downtown to contribute?‖

17. 17 Vibrant Downtown Common Characteristics of Vibrant districts • Events • Entertainment • Destination retail

18. 18 Vibrant Downtown Common Characteristics of Vibrant districts • Geographically remote • Transit hub • College town • Tourist town

19. 19 Vibrant Downtown Common Characteristics of Vibrant districts • Sense of Place • Density These we can achieve

20. 20 Vibrant Downtown Architecture – sense of place How do communities create vibrancy? “If you plan cities for cars and traffic, you get cars and traffic, If you plan for People and Places, you get People and Places.” Fred Kent – Project for Public Spaces

21. 21 Vibrant Downtown Metrics for Downtown! Where are we? • Inventory the town • People • Parking Stalls • Parking demand

22. 22 Vibrant Downtown Where are we? • Inventory the town • Parcels • Buildings • Uses • Owners

23. 23 Vibrant Downtown • Parking demand = People 2,200 People

24. 24 Vibrant Downtown Metrics for Downtown! How do we quantify vibrant? • How many people? • 1,000 people/hr William Whyte ―Rediscovering the center city‖

25. 25 Vibrant Downtown Metrics for Downtown! How do we define vibrant? People on the Street? – 12:30-1:30 • 575 Castro Street • 512 California Ave • 933University Ave • 870 Castro Street – 8:20-9:20

26. 26 Vibrant Downtown Metrics for Downtown! How do we define vibrant? How does Los Altos compare? • 225 2nd & Main • Location • Location • Location • ―Where would you open your retail store?‖ 900 – 700 –500 or 225

27. 27 Vibrant Downtown Metrics for Downtown! How do we define vibrant? 225 people = 25% vibrant = Lack of sales = Lack of rent = Diminished retail environment = Diminished Social Environment = Second hand shops – salons – other services

28. 28 Vibrant Downtown Metrics for Downtown! How do we quantify vibrant? • Retail Rents

29. 29 Vibrant Downtown Metrics for Downtown! How do we quantify vibrant? • Retail rents > Office Rents • Retail rents = 4% to 12% (8%) gross sales • @8%, $4.00 rent = $600 per square foot

30. 30 Vibrant Downtown Metrics for Downtown! Sales Tax Trends – Los Altos Downtown Core 100.00 80.00 60.00 PERCENT 40.00 Fourth Street Berkeley 20.00 Burlingame Los Gatos 0.00 Mountain View 20.00 Los Altos 40.00 The figures in this chart represent the 60.00 downtowns for each of the jurisdictions and are 1995 1997 1999 2001 2003 2005 2007 2009 not city-wide, i.e., the Downtown Los Altos YEAR Retail Core. Source: City Data adjusted to 1995 constant dollars by Andrea Eaton

31. 31 Vibrant Downtown Metrics for Downtown! How do we define vibrant? • 100% Vibrant = $600 / sf annual sales • 1995 Avg. Los Altos = $300 / sf Annual sales • 2009 Avg. Los Altos = $180 /sf annual sales • Los Altos Retail/Restaurant = @8% = $1.20

32. 32 Vibrant Downtown Metrics for Downtown! Retail Rents = $1.20 ÷ $4.00 = 30% Vibrant ―Our Businesses close, they almost never sell!‖

33. 33 Vibrant Downtown Metrics for Downtown Where are you? • People – 25% • Economics – 30% Where do you want to go?

34. 34 Vibrant Downtown 2008 Rezoning 20 year prediction • 34 parcels • 895,000 sq ft office • 495 residential units

35. 35 Vibrant Downtown 2008 Rezoning 5 year results • 895,000 • 1,000 • 495 •2

36. 36 Vibrant Downtown Last 5 years • 895,000 • 1,000 • 495 • 70 • 18 hotel rooms

37. 37 Vibrant Downtown 3 parcels 14,305 sq ft No Parking capacity

38. 38 Vibrant Downtown Metrics for Downtown! How vibrant do you want to be? • 2,200 today = 25% to 30% vibrancy • 50% to 60% = 2,200 • 75% to 90% =4,400 • 100% to 120% = 6,600 • 125% to 150% = 8,800

39. 39 Vibrant Downtown How Vibrant do you want to be? • 100% • Add 4,400 people =2,000 Residential units =3,500,000 sq. ft. = 1,900,000 sq. ft. office

40. 40 Vibrant Downtown Economics – the Dismal Science! Why don’t properties develop? • Prop 13 • Property owners have been here forever • Property owners comfortable—Don’t care No Compelling Economic Reason!

41. 41 Vibrant Downtown Economics – the Dismal Science! Why will properties develop? • How to create the boiling point? • Market Conditions • Policy changes/city levers

42. 42 Vibrant Downtown Where is the Development Boiling Point? • Develop a proforma for specific properties • Developed multiple proformas – testing the edge • The Economic Boiling Point for... • Developer • Property Owner

43. 43 Vibrant Downtown The Economic Model Why will properties develop? • Policy changes/city levers? • Floor Area Ratio (FAR) • Height • Fees

44. 44 Vibrant Downtown The Economic Model Why will properties develop? • Policy changes/city levers? • Use requirements (rents) • Parking  Requirements  In lieu Program/Fees

45. 45 Vibrant Downtown The Economic Model Why will properties develop? • Ratio Redeveloped Value/Current Value = Development Pressure Index (DPI) Greater DPI = Greater Development opportunity

46. 46 Vibrant Downtown Achieving the development boiling point! Additional outputs • School revenues • City revenues • Parking spaces required • People on the street • etc

47. 47 Vibrant Downtown The Economic Model Why Will Property Develop? • Case Study #1 2001 • Office Rent $7.50 • Parking 4/1000 • No In Lieu program

48. 48 Net New Development 3,000,000 2,500,000 Six Story Five Story Four Story 2,000,000 Three Story Square Feet Current 1,500,000 1,000,000 500,000 0 0 1-5 6-10 11-15 16-20 21-25 Years

49. 49 Vibrant Downtown The Economic Model Why Will Property Develop? • Case Study #2 Current Situation • Office Rent $4.00 • Parking 3.3/1000 • No In Lieu Program

51. 51 Vibrant Downtown The Economic Model Why Will Property Develop? • Case Study #3 • Office Rent $4.00 • Parking 2.2/1000* • $10,000 In Lieu Fee** *Based on 4 recent parking studies of 22 office buildings in Los Altos ** Based on Parking, Best Practices.

53. 53 Daily Census 8000 7000 6000 Six Story Five Story People 5000 Four Story Three Story 4000 Current 3000 2000 0 1-5 6-10 11-15 16-20 21-25 Years

54. 54 Vibrant Downtown Why Downtowns are important! Did you know? A Vibrant Downtown Could Contribute… • $3 Million Annually to MVLA • $3 Million Annually to LASD • $4 Million Annually to City $10 Million/yr incremental tax revenues!

55. 55 Vibrant Downtown Should we zone for dollars? NO!

56. 56 Vibrant Downtown We Should zone for… • Great streets • Distinctive Architecture • A sense of place

57. 57 Vibrant Downtown Parking Requirements A Quick History • Nobody studied Parking! 1. Build More! 2. What are their requirements? 3. What does ITE recommend?

58. 58 Vibrant Downtown Parking Requirements & Parking Management • Lead Poison • The first step – The seminal step to revitalizing downtown! • Without change – Look for continuing decline ▫ Economics ▫ Vibrancy ▫ As the Social Center/Place

59. 59 Vibrant Downtown Parking Best Practices • Understand current requirements • Medium term growth requirement • Efficiencies in Parking lay-out • Efficiencies in Parking management

60. 60 Vibrant Downtown Best Practices Los Altos • Establish a Parking Benefit District (PBD) • Create a parking In-lieu program • Adopt parking requirements based in reality • Identify future parking

61. 61 Vibrant Downtown Los Altos Actual Average Demand! • Private Office – 1.6 per thousand! • Average Peak – 2.0 per thousand! • Grocery Retail – 2.4 per thousand!

62. 62 Vibrant Downtown Parking Requirements • Mountain View • Palo Alto • Burlingame • 3000 Sand Hill Rd.

63. 63 Vibrant Downtown Parking In-Lieu Program Benefits for Los Altos • Would open up development • Creates shared parking resources • Shared Resources lead to activity (vibrancy) on the street.

64. 64 Vibrant Downtown • ―The Opinion of this mischievous Effect from Lead is at least above Sixty Years old; and you will observe with Concern how long a useful Truth may be known, and exist, before it is generally receiv’d and practis’d on‖ Benjamin Franklin

65. 65 Vibrant Downtown

66. 66 Vibrant Downtown Great Streets • Building to street Ratio • ½ to 1 • 1 to 1 Los Altos Buildings are 25% to 30%

67. 67 Vibrant Downtown Greentown Los Altos

69. 69 Livermore, CA: First Street

74. 74 Livermore, CA: First Street Commissioned by Design, Community and Environment

75. 75 Vibrant Downtown But I can’t see the mountains!

79. 79 San Bruno, CA El Camino Real - San Mateo Avenue

84. 84 Vibrant Downtown We want a more vibrant Downtown! • Greater economic vitality = Taller buildings/more density • You must reach the Development Boiling Point! • Nostalgic feel low density = Diminished retail • Excessive Parking = Stunted downtown

85. 85 Vibrant Downtown We want a more vibrant Downtown! The model • Informs Community • Informs Policy Makers • Identifies Alternatives/Tradeoffs A Powerful tool for a community based visioning process

86. 86 Vibrant Downtown Los Altos Recent survey • 47% opposed • 43% supported • 3 stories or more • What if they knew?

87. 87 Vibrant Downtown Why Downtowns are important! What is the vibrant downtown experience? ―What attracts people most, it would appear, is other people‖ Walkable Streets

88. 88 Vibrant Downtown Greentown Los Altos

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