For fourteen years, Menlo Park bet that Santa Cruz Avenue would stay a retail-only main street. On June 23, the City Council conceded the bet. If you live here and walk the avenue on Saturdays, the storefronts you pass this fall will not be the ones the 2012 Specific Plan drew up. That is the short version. The longer version, block by block, is what follows.
The vote that quietly reset downtown
The council's June 23 decision amended the El Camino Real and Downtown Specific Plan, the document that has governed what can and cannot open on Santa Cruz Avenue since 2012. The 2012 plan imposed strict limits on uses along Santa Cruz Avenue and in downtown in order to cultivate a retail-focused streetscape. That policy assumed retail rents would hold. They did not. City officials and property owners for years have pointed to a retail vacancy problem downtown, with large storefronts sitting empty and rents outpacing what many retailers can afford.
Councilmember Drew Combs, at the June 23 meeting, described the original plan as "almost a complete failure as it relates to actually revitalizing Santa Cruz Avenue". The council unanimously approved a scaled-back version of the Planning Commission's recommendation.
What is now allowed where it was not
The practical effect is a shorter list of prohibited uses on the ground floor. Two categories moved:
- Personal service businesses. Spas, salons and similar personal service businesses will now be allowed to operate on the ground floor without a conditional use permit; previously, those uses were generally restricted to upper floors.
- Small-scale recreation. Businesses classified as small-scale recreation, including gyms and arcades, may now apply for use permits to open on Santa Cruz Avenue after previously being prohibited. Those permits must be reviewed by the Planning Commission, which retains authority to approve or deny individual projects.
There is a ceiling on the category most residents complain about. Financial institutions like banks, which already account for about 28,000 square feet, will be limited to a total of 30,000 square feet on Santa Cruz Avenue. In other words, two thousand more square feet of bank frontage is possible, and then the cap closes. Massage parlors will remain outside the downtown core.
The zoning change matters less for what it allows tomorrow than for what it signals about how the city now reads its own downtown. A gym at street level was a policy failure in 2012. In 2026 it is a policy solution.
870 Santa Cruz and the vacancy math
The application that triggered the amendment came from a single building owner. The changes stem from an application filed by Windy Hill Ventures, the owner of 870 Santa Cruz Ave., which argued that existing zoning rules have made it difficult to attract tenants and contributed to persistent vacancies along the city's main commercial corridor. Windy Hill's principal, Tod Spieker, is a Menlo Park native who told The Almanac in May that "downtown has a retail vacancy problem, and it has for years. Building owners don't want to invest in their buildings because they can't get the rents or tenants to support their investment."
The company paid to make its case. Records obtained through a Public Records Act request show Windy Hill paid the city at least $57,658 in staff time between November 2024, when the application was submitted, and the end of March 2025. That figure is worth holding against a baseline: it is roughly the cost of a full year of ground-floor rent on a small Santa Cruz Avenue space, spent by one owner on staff-time reimbursement alone to change the rules for everyone. The public comment volume tracked the interest. The Planning Commission received 87 written public comments and 10 in-person comments ahead of the meeting. City staff said the written comments were overwhelmingly supportive of the changes.
If you are wondering why a single 870 Santa Cruz Ave. application produced a plan-wide amendment, the answer is that the vacancies were never confined to one building.
The 600 Block, mid-remake
Walk east from 870 toward the 600 block and the second visible change is already underway. The 600 Block Public Plaza on Santa Cruz Avenue in Menlo Park is undergoing a major transformation. Once complete, the Plaza will have seating, new landscaping, shade canopies and a stage for performances and entertainment. The space will be a central downtown location for community gatherings. In the meantime, new picnic tables are being installed in the Plaza, available to the public as open seating.
The plaza project answers a question the pandemic-era street closure raised and never resolved: whether Santa Cruz Avenue works better as a road or as a room. During the height of the COVID-19 pandemic in 2020, the city closed one segment of Santa Cruz and part of Ryans Lane to create outdoor space where patrons could dine and gather while subject to pandemic health protocols. In 2023, the council voted 4-1, with Combs dissenting, to continue the Santa Cruz closure while reopening Ryans Lane. The 600 Block Plaza is the compromise built in concrete: not a permanent street closure, but a permanent public room off the sidewalk.
A shorter Michelin walk this month
On June 25, two days after the zoning vote, the food story on the Peninsula shifted as well. Michelin removed 7 Peninsula restaurants from its guide. The list matters less than the timing. A downtown that spent June loosening its zoning rules woke up two days later with a shorter local list of guide-recognized rooms to point out-of-town guests toward. For residents, the practical read is that the restaurants that stayed on the guide are working with a smaller crowd of Peninsula peers this summer, and the ones that dropped off will be pricing weekend covers accordingly.
The counterweight is the revived Guild Theatre, three blocks over, which has anchored the eastern end of the avenue's momentum. Independent boosters at the Downtown Menlo Fund describe the current stretch of the avenue in terms residents will recognize: new restaurants, a revived Guild Theatre, and the emergence of a true Design District are drawing visitors from across the Peninsula.
What to watch between now and fall
If you already live in Menlo Park, the changes above translate to a short list of things you are likely to notice on the ground before Labor Day:
- Use-permit applications for the first gyms and small-scale recreation tenants under the new rules. These go to the Planning Commission, and the hearings are public.
- Fresh interior build-outs at 870 Santa Cruz Ave. and neighboring vacant frontages, now that the owner class has a wider tenant pool to court.
- New picnic tables in the 600 Block Plaza well before the shade canopies and stage arrive. Treat them as a preview of the finished room, not the finished room.
- Menu and reservation adjustments at Peninsula restaurants after the June 25 Michelin removals. Weekend cover pricing is the fastest signal.
- Continued discussion of whether to reopen the pandemic-closed segment of Santa Cruz Avenue between Curtis and Doyle. A business survey conducted by Save Downtown Menlo showed that sixty-two of the 75 businesses surveyed indicated they would like to know if the stretch of road reopened. Seven businesses responded that they would like to see the closures continued; an additional six businesses said they were unsure. That question is still open at the council level.
None of this changes the trees on Santa Cruz Avenue, the Saturday farmers market, or the hardware store. What it changes is the mix of front doors between them. The 2012 plan tried to hold a particular kind of main street in place. The June 23 vote acknowledged that residents will get a different one, and that the city would rather shape the new mix than protect the old vacancy.
For residents thinking about how this downtown chapter affects the value of a home nearby, or a sale timed against the plaza's completion, the team at Straser Silicon Valley tracks these block-level shifts as part of a broader Peninsula practice. Request a white-glove consultation when the question is ready to move from sidewalk to strategy.
