A downtown San Mateo mixed-use proposal at 435 E. Third Ave. received general support from the Planning Commission at its Nov. 23 meeting, although concerns about no parking proposed to accommodate offices and housing has worried the commission.

“I do think that the off-street parking is the biggest element of friction for people in the neighborhood,” Commissioner Adam Nugent, who lives in the neighborhood, said.

The proposed five-story mixed-use development near downtown San Mateo is at the northwest corner of East Third Avenue and South Claremont Street. The development would be four floors of office use, while the fifth floor would have five residential units. The site is a quarter of an acre, with the development around 40,000 square feet and around 55 feet high. Adjacent areas include Takahashi Market, restaurants and retail stores. The San Mateo downtown Caltrain station is a quarter-mile north. Michael Field of Windy Hill Property Ventures, the developer, called the property an unofficial entryway into downtown.

Field has said the small landlocked site is bound by a historic building at the corner of Third and Railroad avenues and a generational landowner who has declined to sell an adjacent property. Field said the project does not call for parking, as the property is too small to accommodate or build underground parking. Windy Hill is instead asking to pay parking in-lieu fees for the entire building, which it estimated would be around $3.8 million. Parking in-lieu fees give developers the option of paying a fee instead of providing on-site parking spaces required in a city zoning code. There would be an estimated 96 off-street parking spaces, with $52,550 estimated per space. City staff said the in-lieu fees would be limited for parking uses. The city is doing a parking study to determine details about parking and how many spaces on the site will be allocated.

“It is not possible to build subterranean parking on this site because there is not enough distance for a parking ramp,” Field said.

Nugent said his issues with the parking were mostly about pricing and management of a potential right of way of city streets from the funding. Questions remain about how demand from the building would affect parking in the area, residents and proposed or existing parking facilities.

“That is where the pressure point will be for this project is how we will accommodate that,” Nugent said.

Commissioner John Ebneter wanted to see a different building exterior from surrounding properties to give it its own identity. The building design is a combination of contemporary and traditional elements and uses brick veneer, wood and stucco. He still wanted off-street parking incorporated, but if parking-in lieu fees were used, he would like to see it go toward a housing component rather than parking.

Vice Chair Margaret Williams said parking in-lieu fees were acceptable given the small site constraints, although she acknowledged off-street or underground parking was ideal. She said if there were more residential units, she would have felt different.

“As John [Ebneter] said, there’s only so much you can do on a site of this size, Williams said.

The Planning Commission inquired about more housing on the site to meet the city’s unbalanced office to housing unit ratio. Field said adding more housing would result in losses and make the project economically unfeasible. He cited the small-scale nature of the project and the thin margins overall.

“On a project where the site is so constrained, we have to absorb certain costs, and the office space helps us to do that just to make the project even feasible. If we lost office space in this project, the project would be completely unfeasible,” Field said.

Nugent said while the office to housing unit ratio was a concern, he acknowledged offices downtown were important to provide an opportunity to live and work in the same space.

Windy Hill is in contract to purchase the property. If the city approves the redevelopment, the purchase will go through. The redevelopment would demolish all existing onsite structures, consisting of a Swift Auto Repair. Several mixed-use buildings downtown are under consideration or being built. The largest is Block 21, a project to redevelop the block of East Third Avenue, South Delaware Street, East Fourth Avenue and South Claremont Street. Other mixed-use developments include a three-story building proposal at 180 E. Third Ave. and an approved four-story office and residential building at 406 E. Third Ave. A proposed redevelopment is under consideration to demolish Draeger’s grocery store 222 E. Fourth Ave. and replace it with a five-story mixed-use building.

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