Item No. {{item.number}}
Town of Atherton
CITY COUNCIL STAFF REPORT – STUDY SESSION
TO: HONORABLE MAYOR AND CITY COUNCIL
GEORGE RODERICKS, CITY MANAGER
FROM: BRITTANY BENDIX, CONSULTING TOWN PLANNER
DATE: SEPTEMBER 3, 2025
SUBJECT: DISCUSSION OF CAMPUS HOUSING DEVELOPMENT
RECOMMENDATION
It is recommended that the Council review and discuss the challenges to on-campus housing development and provide direction to staff on next steps to support future housing.
BACKGROUND
On June 23, 2025, the Town of Atherton held a joint study session with the City Council and Planning Commission to discuss recommendations for the Town’s inclusionary housing program and provide feedback to staff. During this discussion the Council considered the Town’s production of lower income housing based on the 2024 Annual Progress Report (APR) to the California Department Housing and Community Development (HCD). Between 2025 and 2031, the Town must produce an additional 162 housing units at the very low-, low- and moderateincome levels to satisfy the Regional Housing Needs Allocation (RHNA) for Atherton. Although the Town is on pace to meet most of its lower income housing needs through the production of Accessory Dwelling Units (ADUs), the Council recognized the need to continue the pursuit of campus housing development at Menlo College and Menlo School. The sites identified in the 2025-2031 Housing Element on these two campuses can accommodate up to 138 affordable housing units.
At the direction of Council; the Mayor, Vice Mayor, City Manager and Consulting Town Planner met with the leadership of Menlo College on July 15, 2025, and Menlo School on August 13, 2025 to discuss housing needs on each respective campus. The following report addresses feedback from each institution and identifies recommended steps the Town can take to support potential housing development.
September 3, 2025, City Council Staff Report
SEPTEMBER 3, 2025
ANALYSIS
Menlo College
In 2023 Menlo College provided a supplemental letter to the Town for inclusion with its housing element submission to HCD. The letter indicates that “local donors would contribute the funds necessary to prepare the conceptual design of a four story 40-60 unit multifamily complex and associated parking garage on what is currently a parking lot.” Menlo College includes three identified sites in the Town’s Housing Element, the O’Brien parking lot, the existing faculty housing apartments and the Administration parking lot. Collectively these sites could accommodate up to 98 affordable housing units per the RM-20 and RM-40 zoning overlays. This represents the largest amount of housing possible under single ownership and current zoning within the Town.
In the meeting with Menlo College President Steven Weiner on July 13, 2025, the assertion in the letter still holds; however, there is currently no identified donor and no funding to support initiating a conceptual design. Menlo College remains interested in pursuing housing on-campus and would appreciate assistance from the Town.
Menlo School
The Town’s certified housing element identifies two sites for housing on the Menlo School campus that can accommodate up to 40 units total per the RM-20 zoning overlay. These sites are the two parking lots that flank the entrance onto the campus from Valparaiso.
The Administration continues to assert that faculty housing for the school is highly desired.
However, while on-campus housing development could be possible, the resulting housing typology does not meet the school’s current needs. Specifically, housing for households or varying sizes and that are off-campus, but within walking distance. This need is better aligned with the Town’s RM-10 zoning overlay, especially those sites situated on Ravenswood Avenue. Further, with the added expense of under-grounding the parking provided at each lot, the costs of development under-compete market values of multifamily housing that is already available or entitled in neighboring jurisdictions.
Town Participation and Support
The Town has provided a more favorable regulatory environment for housing development on all of the Town’s privately-owned school sites. This includes streamlining the permitting process, adopting higher-densities in the Public Facilities and Schools (PFS) zoning district, and completing the required environmental analysis for development at the intensities identified in the adopted housing element. However, each campus still has challenges. Menlo College needs support financially and potentially with staffing to initiate development efforts. Menlo School appears to need greater flexibility with off-site housing options.
September 3, 2025, City Council Staff Report
SEPTEMBER 3, 2025
The following list provides some approaches that the Council may consider when providing staff direction on next steps.
Provide staffing and/or financial support to seek grants and loans that support housing development for educational uses. While many grants and loans are designed for public institutions and are highly competitive, it is possible that the private schools may be eligible for certain programs specific to lower income households. The Town could assist by dedicating staff resources to research potential programs and assist in compiling application materials.
Foster public-private partnerships (P3s) between universities and developers. Similar to support with grants and loans, there is a growing field of developers focused on work with educational institutions. These partnerships structure the project financing to build privatized student or faculty housing. The benefits to the developer can be tax, bond, or revenue related. To help foster this relationship, the Town could dedicate staff resources to assisting Menlo College with issuing a competitive solicitation for P3 partners. Pursuing a P3 partner for Menlo College could alleviate competitive pressure on the college’s other fundraising efforts. However, it is possible that the Town will receive feedback from prospective developers that they desire greater zoning changes to maximize profit.
Donor-driven developments are also a prevalent method in producing housing on private school campuses. These efforts are frequently driven by a single private or corporate donation and may require additional programming beyond housing. For example, a donor could bequeath an art collection or require a specific facility to be integrated into the development to receive the gift. While the financing and gift are greatly appreciated, they can come with additional development that requires Planning Commission approval or rezoning. The Town could facilitate this effort by tasking a committee of residents to contact potential donors and solicit donations.
Timing and Next Steps
The Council should indicate how it would like to use the Town’s resources to continue to pursue campus housing and indicate a reporting timeline and method so that staff can continue to keep the Council informed on any updates.
Housing Element Program 3.811(C) indicates that the Town is required to demonstrate progress towards its campus housing goal during the review of the 2027 APR, in March of 2028. If there is no progress, then the Town must act to develop new incentives and work closely with property owners with potential rezoning adopted by the end of September 2029 and effective in January 2030. “Progress” is not defined in the program language, but it should be considered in tandem with the Town’s RHNA performance and the tabulation of issued housing permits for affordable units. Staff recommends that the Town consider “progress” to mean an identified development team, financing mechanism and conceptual site plans with elevations. Collectively this information would be sufficient to identify any regulatory challenges to development that the Town could address.
September 3, 2025, City Council Staff Report
SEPTEMBER 3, 2025
FISCAL IMPACT
None at this time.
GOAL ALIGNMENT
This Report and its contents are in alignment with the following Council Policy Goals:
• Goal A - Preserve Small Town Character & Quality of Life • Goal D - Be Forward Thinking
Land Use & Planning Priorities – Objective 8 – Work with multi-family project developers to address the Town’s affordable housing targets with specific emphasis on Menlo College.
PUBLIC NOTICE
Public notification was achieved by posting the agenda, with this agenda item being listed, at least 72 hours prior to the meeting in print and electronically. Information about the project is also disseminated via the Town’s electronic News Flash and Atherton Online. There are approximately 1,200 subscribers to the Town’s electronic News Flash publications. Subscribers include residents as well as stakeholders –to include, but be not limited to, media outlets, school districts, Menlo Park Fire Protection District, service provides (water, power, and sewer), and regional elected officials.
COMMISSION/COMMITTEE FEEDBACK/REFERRAL
This item has not been before a Town Committee or Commission
ATTACHMENTS
NONE