December 17, 2009
The Mountain View City Council upped the density on a piece of land owned by the county to allow 50% FAR (floor-area ratio), up from 30%. The 3.6 acre parcel is located at 590 E Middlefield Road.
The county had previously put the property up for bid, but bids came in too low for the county’s taste. The plan now that they’ve gotten more density is to go out for a second round of bidding.
Unfortunately, the extra density doesn’t mean much unless the buyer is a user who wants to do a build to suit, which are far and few between right now given what existing buildings can be purchased for.
The extra density without a reduced parking requirement means a parking garage or underground parking, which increases the cost of construction, and negates the extra money the county may think the land is worth.
On the other hand, if the developer can get away with 50% FAR and be able to surface park the project, then they will have a deficient product on their hand because the parking ratios won’t be sufficient and will put the project at a disadvantage (despite being next to the light rail), which isn’t a scenario any developer wants either.
So unless the County can find a user, the County shouldn’t expect to increase the price of the land by 60% because they got 60% more density. The county really ought to just hold onto the land and wait for a user who needs a specialized building and get their premium that way because without a user showing up, the counties cost to “rent” or raise money elsewhere is likely below what the land will appreciate at from this point.
[via MV Voice]
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