The Palo Alto City Council voted unanimously on Nov. 19 to implement the first part of its multi-step plan to fill vacancies in major commercial centers.
The city updated its policy for California Avenue, now allowing chain stores with fewer than 50 locations across the state to open a shop, an increase from the previous limit of 10 statewide locations. Additionally, throughout commercially zoned areas, the city council made it easier for businesses to acquire conditional use permits to open a store.
The Campanile supports the city’s policy, believing it will funnel traffic to retail hotspots and in turn boost small businesses.
Small businesses are essential to preserve the local character of our downtown areas. Residents often form stronger relationships with store owners who are their neighbors and have an active stake in the betterment of our community. Therefore, whenever possible, The Campanile urges the city to give priority to small businesses over chain stores when filling vacancies.
The vacancy rate for businesses is 10% on California Avenue and 15% on University Avenue, a legacy of the pandemic and high rent costs. Neighboring cities have been hit hard too — the vacancy rate in Mountain View is at 8.5%.
Since California Avenue was permanently closed off to cars in November 2023, several small business owners on California Avenue said in interviews with The Campanile that they think increasing accessibility for chains will bring more customers to their stores. Chain stores also provide convenience and standardized products for which will also likely increase the number of customers who shop in commercial areas.
The Campanile also thinks the new policy effectively prevents the largest chains from overwhelming and outcompeting small businesses. Because chains with more than 50 locations operating in the state must still obtain conditional use permits, large chains — often accustomed to redesigning buildings to fit their companies’ traditional store designs — will still be prevented from accessing our downtowns.
The unanimous support of the Palo Alto City Council and the CEO of the Palo Alto Chamber of Commerce speaks to the confidence Palo Alto leaders have in the plan to revitalize our downtown areas while maintaining our local charm.
Ideally, the city should also address the root causes of the surge in vacancies on California and University Avenue.
It is critical to address why small businesses are closing and not entering the city instead of just mitigating the issue by allowing larger businesses in.
Ultimately, while easing zoning restrictions for chain stores requires careful oversight to protect the role of small businesses in building community connections and maintaining our local identity. The Campanile supports the approval of a policy that will revitalize small businesses that rely on in-person customers, reduce vacancies and expand options for the community.