CITY COUNCIL
Staff Report
From: City Manager
Report Type: ACTION ITEMS
Lead Department: Planning and Development Services
Meeting Date: May 11, 2026
Report #: 2603-6070
TITLE
PUBLIC HEARING / QUASI-JUDICIAL. 3781 El Camino Real [24PLN-00161]: Request for Approval of Major Architectural Review Application to Merge Four Existing Parcels to Create a 63,025 Square-Foot Parcel and to Construct a Seven-Story, Multi-Family Residential Housing Development Project with 183 Units. Thirteen Percent of The Base Units Would be Provided at a Rate Affordable to Low Income. The Project is Proposed in Accordance with Builder’s Remedy (California Government Code Section 65589.5(d)(5)). A Senate Bill 330 Pre-Application was Filed on February 15, 2024. CEQA Status: Exempt Pursuant to Assembly Bill 130 (Public Resources Code Section 21080.66).
RECOMMENDATION
Staff recommends that City Council:
1. Consider the project exempt from California Environmental Quality Act (CEQA) in accordance with Assembly Bill (AB) 130 (Public Resources Code Section 21080.66); and
2. Approve the Major Architectural Review application based on findings and subject to conditions of approval in the Draft Record of Land Use Action (RLUA) in Attachment B.
EXECUTIVE SUMMARY
The proposed residential project includes 183 rental units, thirteen percent of the base units of 1(23 units total) would be provided at a rate affordable to low-income households or below, with two levels of above ground parking. The project includes demolition of 14 residential rental units as well as approximately 10,100 square feet of commercial floor area across four existing parcels located at 3727-3737 & 3773-3783 El Camino Real, 378-400 Madeline Court, and 388 Curtner Avenue. These four parcels would be merged through a Certificate of Compliance to create a single parcel for the proposed development. 1 Inclusionary percentage is based on the pre-density bonus count of 177 units.
The applicant filed a compliant pre-application in accordance with Senate Bill (SB) 330 on February 15, 2024 (24PLN-00048). Therefore, the project analysis is based on the applicable standards at the time the compliant SB 330 pre-application was submitted. In addition, the project is considered a “Builder’s Remedy project” as defined in the recently adopted AB 1893.
Accordingly, the project may not be denied on the basis of inconsistency with the Zoning Ordinance or Comprehensive Plan land use designation. The project is further afforded numerous protections as detailed below.
On September 22, 2025, the applicant requested that the project be considered exempt from environmental review under AB 130 [Public Resources Code section 21080.66]. AB 130 exempts infill housing projects meeting certain criteria from the California Environmental Quality Act (CEQA) and sets strict timelines for City review and decision. The City has determined that the project is exempt from CEQA in accordance with AB 130 and is therefore subject to strict timeframes for City action. Pursuant to these timelines, in addition to a 90-day extension agreed to by the applicant at the City’s request, a decision on the application is required by May 26, 2026. Inaction within this timeframe results in automatic approval under State law.
Although the project deviates from local standards, such deviations are permitted under applicable State law, including the State Density Bonus Law, the Housing Accountability Act, and the Builder's Remedy, as discussed further in this report.
BACKGROUND
Following submittal of a compliant SB 330 pre-application, the applicant submitted a formal application for Major Architectural Review on June 10, 2024 (24PLN-00161). In accordance with the Major Architectural Review process, the ARB reviewed the application on January 15, 2026 and recommend approval, as detailed further below.
Project Description
The project involves demolishing 14 residential units and approximately 10,100 square feet of commercial floor area across four existing parcels at 3727–3737 & 3773–3783 El Camino Real, 378–400 Madeline Court, and 388 Curtner Avenue. These parcels would be consolidated into an approximately 1.44-acre lot through a ministerial Certificate of Compliance process.
The redeveloped site would be exclusively residential rental, comprising 183 units with 13 percent designated as affordable to low-income households. The building would rise seven stories to 82 feet and include two levels of above-ground parking, ground-floor residential amenities, and a rooftop terrace oriented toward Curtner Avenue. A location map is provided in Attachment A, the applicant's assertion of legal rights in Attachment F, and the full project plans in Attachment G.
The applicant submitted an SB 330 pre-application on February 15, 2024 (24PLN-00048), and the project analysis is therefore governed by the applicable standards in effect at the time that compliant pre-application was filed. The project is also proposed under California Government Code Section 65589.5(d)(5), commonly known as Builder's Remedy, and qualifies for additional protections as a "Builder's Remedy 2.0 project" under AB 1893. The applicant's full project description, including a list of waivers requested under State Density Bonus Law, is provided in Attachment F. As discussed in greater detail in this report, provided the project is designed in compliance with all relevant objective standards, the City may not impose conditions that would prevent construction of the project as proposed, even after the application of density bonus incentives, concessions, and waivers.
Requested Entitlements, Findings, and Purview
The following discretionary applications are being requested and subject to Council purview:
Architectural Review – Major (AR): The process for evaluating this type of application is set forth in Palo Alto Municipal Code (PAMC) Section 18.77.070. AR applications are reviewed by the ARB and recommendations are forwarded to the Planning and Development Services Director for action within five business days of the Board’s recommendation. Action by the Director is appealable to the City Council if filed within 14 days of the decision. The Director may instead forward a project directly to City Council for final action in accordance with PAMC Section 18.40.180. AR projects are evaluated against specific findings. All findings must be made in the affirmative to approve the project. Failure to make any one finding requires project redesign or denial.
The findings to approve an AR application are provided in Attachment B.
Purview of the formal application is limited by the following State law in the following ways:
Housing Accountability Act (Government Code 65589.5): The project constitutes a “housing development project,” as well as “housing for very low, low-, or moderate income households” under the Housing Accountability Act. The Housing Accountability Act Section 65589.5(d) states that a city cannot deny such a project or impose conditions of approval that would render it infeasible unless it makes specified findings.
Among those findings are: that the project would have a specific, adverse impact upon the public health or safety that cannot be mitigated. “Specific, adverse impact” means “a significant, quantifiable, direct, and unavoidable impact, based on objective, identified, written public health or safety standards, policies, or conditions as they existed” at the time of the preliminary application.
Because the project is a “Builder’s Remedy 2.0 project,” under AB 1893, the City is further limited to only enforcing those objective standards that exist in a zone district or land use designation that allows the density requested. If there are no such zoning districts or general plan designations in the City, then the applicant may identify any City standards that facilitate the project and only those standards shall apply. If the project meets these identified standards, the City cannot impose conditions of approval that preclude the project from being constructed as proposed by the applicant.
Because the project is a “Builder’s Remedy 2.0 project,” under AB 1893, the “base density” for purposes of State Density Bonus Law shall be the maximum density permitted for Builder’s Remedy projects (e.g. three times the density permitted in the zoning code or general plan).
The project applicant is also able to utilize incentives, concessions, and waivers under State Density Bonus Law when demonstrating compliance with the enforceable standards.
Architectural Review Board
On January 15, 2026, the ARB recommended approval of the project (3-0) with Vice Chair Adcock and Board Member Hirsch absent. The ARB also recommended that City Council consider the following conditions of approval for the project:
Add third elevator to the northeast wing of the structure. Clear path of travel within bike room with the addition of a door to the parking garage. Add an off-street loading space.
Improve the parking garage screening to neighbors.
Recess the entrance along El Camino Real to ensure an 8-foot clearance when doors are open.
Expand 3rd-floor balconies, where possible.
Streamline balconies along El Camino Real with different materials to reduce transparency.
Reduce the visual massing of the structure through architectural expertise with refined facade detailing, and upper story stepbacks, potentially moving the top floor back by 4 feet.
Provide detailed courtyard sections explaining the spa and plantings.
A detailed summary of modifications made to the applicant in response to the ARB’s feedback is included in Attachment F.
ANALYSIS
Staff evaluated the project in accordance with the Comprehensive Plan, Zoning Ordinance, and other applicable goals and policies of the City and found the project consistent with objective standards or otherwise deviates in a manner permissible under State law.
Consistency with the Comprehensive Plan, Area Plans, and Guidelines The project site includes four parcels with varying Comprehensive Plan land use designations, including Neighborhood Commercial, and Multiple-Family Residential designations as reflected in Attachment A. Consistent with the Comprehensive Plan’s encouragement of housing near transit centers, higher density multi-family housing may be allowed in specific locations in the Neighborhood Commercial land use designation. The project is located along a high-quality transit corridor and within the El Camino Real Focus area. Therefore, the proposed use multi- family residential use is consistent with this Comprehensive Plan land use designation.
Other portions of the project site are designated multiple-family, where the permitted number of housing units varies by area, depending on existing land use, proximity to major streets and public transit, distance to shopping and environmental problems. Net densities range from 8 to 90 persons per acre (8 to 40 units). Density should be on the lower end of the scale next to single-family residential areas. However, densities higher than what is permitted may be allowed where measurable community benefits will be derived, services and facilities are available, and the net effect will be consistent with the Comprehensive Plan.
While the density on the site exceeds the stated maximum of 40 units per acre set forth under the land use designation, the proposed density is allowed pursuant to California Government Code section 65589.5(h)(11)(C). Under these provisions the base density allowed for the site as a whole is 122 dwelling units per acre (du/ac), which is approximately 177 units for this site, plus a 24.5% bonus (43 units) based on the number and income level of the below market rate units provided, resulting in a total of 220 units allowed (density of approximately 152 du/ac).
The project provides a total of 183 units, which is within the allowed density in accordance with the Builder’s Remedy provisions set forth in AB 1893.
Housing Element Consistency
The project site was not identified as a Housing Inventory Site in the adopted Housing Element.
However, the proposed development would provide 169 net new units units, including 23 units at a rate affordable to low-income, which would count toward the City’s Regional Housing Needs Allocation (RHNA). These units would help advance Housing Element implementation by contributing housing in areas outside the inventory. The project would also help offset shortfalls if identified inventory sites are not developed to their assumed capacity or timeframe.
El Camino Real Design Guidelines Consistency
The project is also subject to the El Camino Design Guidelines and South El Camino Design Guidelines to the extent that these guidelines include objective standards. The design guidelines are intended to direct the project design process toward solutions that, given site conditions and the requirements of the development program, best meet City goals and community values and expectations. Notable recommendations include landscaping buffers, screening of mechanical equipment and parking areas, pedestrian oriented designs in the CN district, minimizing the number of driveways, limiting building colors to no more than three primary colors, and defining corner elements. As proposed, the project is generally consistent with these guidelines, although only objective standards may be applied to the project. Where the guidelines encourage specific requirements such as colors and defining corner elements, the project complies with the related objective standards set forth under PAMC Chapter 18.24.
Although the project does not include a ground floor commercial use and, accordingly, does not provide ground floor glazing/transparency, this deviation is permitted under the builder’s remedy.
Zoning Compliance
Because the site area is comprised of four lots, there are two different zoning designations across these lots, including portions zoned CN and RM-30. The project does not propose to rezone these parcels for consistency across the resulting parcel. However, the site is located within the El Camino Real Focus Area. The El Camino Real Focus Area modifies and replaces some of the development standards provided in base zone districts and applicable combining district regulations for housing development projects. In some instances, the El Camino Real Focus Area standards refer to the governing base district regulations. Therefore, Attachment C includes a summary of the project’s consistency with the El Camino Real Focus Area standards as it would apply to each zone district on the site. Additionally, Attachment D includes a summary of the project’s consistency with the objective design standards set forth in PAMC Chapter 18.24.
Because the project is a Builder’s Remedy project, inconsistencies with the objective standards in Attachments C and D do not constitute a basis for denial. These inconsistencies are provided for informational purposes only.
In addition, the applicant may request a waiver under State Density Bonus Law from any development standard that would physically preclude development at the proposed density. If the project is designed to comply with all objective standards that would apply to a site that allows the density requested, after application of density bonus incentives, concessions, and waivers, the City cannot impose conditions that would preclude construction of the project as proposed.
Multi-Modal Access
Valley Transit Authority (VTA) bus line 22 runs along El Camino Real with a bus stop near the far southern corner of the project site. The project is located approximately 1.2 miles from the California Avenue Caltrain Station and fronts El Camino Real. California Department of Transportation recently installed Class III and Class IV bicycle facilities along El Camino Real adjacent to the project frontage, further enhancing multimodal access for cyclists. Vehicular access to the project site is provided from Curtner Avenue, consistent with the current parcels.
The project includes a single vehicular access where there are two.
Parking and Loading
The project includes 196 vehicle parking spaces, 36 of which would be tandem, and six motorcycle parking spaces, exceeding the 183 vehicle parking spaces required under the Zoning Code (pursuant to the focus area standards). Of the resident-assigned spaces, 151 would be electric vehicle (EV)-capable, including one accessible EV space and one van-accessible EV space, with 39 non-EV spaces also provided. The project is required to provide 183 EV-ready spaces in compliance with the California Green Building Code (CalGreen). Therefore, a condition of approval has been added to require that parking comply with CalGreen requirements. Bicycle parking is provided within the parking garage near the El Camino Real frontage and includes 144 long-term bicycle spaces. An additional four short-term bicycle spaces are proposed to be located within the front setback along El Camino Real. The Zoning Code requires 183 total bicycle spaces as well as 18 short-term spaces, while CalGreen requires approximately 23 short- term spaces. The conditions of approval require the applicant to provide short-term bicycle parking in conformance with CalGreen code requirements. Title 8 Consistency (Trees) The project site has a total of 41 existing trees representing 14 species that were assessed in the Preliminary Arborist Report dated July 11, 2024, by HortScience, Bartlett Consulting. Of the 41 trees documented, 31 trees are recommended to be removed, only one of which is protected, a bronze loquat that is within the foundation footprint along the Curtner Avenue frontage. A total of 12 trees would be preserved, including all trees within the El Camino Real right-of-way and all trees on the neighboring properties. The project proposes a total of 72 new trees along property lines, as street trees, and within open space areas. Tree replacement mitigation values for the project are further detailed in the Tree Disposition Table (L-5.4) of the plan set, see Attachment G.
PAMC Section 18.24.020 (B)(2) Street Trees requires that one street tree provided for every 30 linear feet of public sidewalk length and located within six feet of the sidewalk. While the project proposes five new street trees and retains the existing four street trees along El Camino Real, it does not meet the required 16 trees along the two frontages. In order to accommodate other requirements, including fire access, stormwater treatment, and utilities, necessary for the project, conditions of approval to require further planting have not been included.
The project will demolish 14 existing units and construct 183 new units, resulting in a net gain of 169 units. The 14 units slated for demolition are subject to the rental protections under Municipal Code Chapter 9.68, specifically the no-fault eviction provisions in Section 9.68.060, which apply to properties with more than 10 units.Application Consistency As detailed in Attachment B, staff finds that this project meets the required findings for a Major Architectural Review. However, the project is not consistent with several provisions of the Comprehensive Plan and Municipal Code.
Notwithstanding these inconsistencies, the City is required to approve the project pursuant to State law. Specifically, although the project deviates from local standards, such deviations are permitted under applicable State law, including the State Density Bonus Law, the Housing Accountability Act, and the Builder’s Remedy.
FISCAL/RESOURCE IMPACT
Processing of this application has limited fiscal impact as applicants are responsible for staff and consultant costs through applicable fees through the deposit-based cost recovery program.
Although the proposed development would result in limited loss of sales tax from the existing retail and retail-like uses on the property, the proposed improvements are anticipated to increase the assessed value of the subject property, which will generate additional property tax for the City. Palo Alto receives approximately 9.4% of the additional property tax generated.
This project is also subject to Development Impact Fees, currently estimated at $10,029,295 plus the applicable public art fee. These fees are required to either be paid at building permit issuance or, with the recordation of a lien on the property, may be deferred until occupancy.
STAKEHOLDER ENGAGEMENT
The Palo Alto Municipal Code requires notice of this public hearing be published in a local paper and mailed to owners and occupants of property within 600 feet of the subject property at least ten days in advance. Notice of a public hearing for this project was published in the Daily Post and postcard mailing occurred on May 1, 2026, which is 10 days in advance of the meeting.
Public Comments
As of the writing of this report, the City has received comments from interested stakeholders which are included in Attachment E.
ENVIRONMENTAL REVIEW
The subject project was assessed in accordance with the authority and criteria contained in the California Environmental Quality Act (CEQA), the State CEQA Guidelines, and the environmental regulations of the City. On September 22, 2025, the applicant requested that the project be considered exempt under AB 130 [Public Resources Code section 21080.66]. AB 130 exempts many infill housing projects from CEQA and additionally sets strict timelines for City review and decision. The City evaluated the project for its eligibility under AB 130 and found that the project is eligible.
The City sent letters in accordance with AB 130 inviting tribes to participate in consultation on the project in accordance with state laws. The City received two requests for consultation from Tamien Nation and the Muwekma Ohlone Tribe of the San Francisco Bay Area in accordance with tribal consultation periods provided under AB 130. The City consulted with each of these tribes and sent proposed conditions of approval in accordance with the recommendations identified by each of these tribes during the consultation process. Although the City did not receive a formal response from either tribe confirming that consultation was complete, AB 130 limits the allowed timelines for consultation and, accordingly, Tribal consultation was considered complete on January 26, 2026. The proposed conditions of approval, as presented to the tribes, are incorporated in Attachment B.
ATTACHMENTS
Attachment A: Location Map
Attachment B: Draft Record of Land Use Action
Attachment C: Zoning Consistency
Attachment D: Objective Standards Consistency Analysis
Attachment E: Public Comments
Attachment F: Applicant’s Project Description
Attachment G: Project Plans
APPROVED BY:
Jonathan Lait, Planning and Development Services Director