SAN FRANCISCO — Tech business titans have navigated quite a bit to get the place they’re right this moment — the dot-com bust, the 2008 recession, a backlash in opposition to tech energy, the pandemic. They have overcome boardroom showdowns, investor energy struggles and regulatory land mines.
But this summer time, some of them encountered their most threatening opponent but: multifamily townhouses.
Their battle befell in one of Silicon Valley’s most unique and wealthiest cities: Atherton, Calif., a 4.9-square-mile enclave simply north of Stanford University with a inhabitants of 7,500. There, tech chief executives and enterprise capitalists banded collectively over the specter that multiple residence might exist on a single acre of land in the final neighborhood of their estates.
Their weapon? Strongly worded letters.
Faced with the chance of new building, Rachel Whetstone, Netflix’s chief communications officer and an Atherton resident, wrote to the City Council and mayor that she was “very concerned” about site visitors, tree elimination, gentle and noise air pollution, and college assets.
Another native, Anthony Noto, chief government of the monetary expertise firm SoFi, and his spouse, Kristin, wrote that robberies and larceny had already turn out to be so dangerous that many households, together with his, had employed non-public safety.
Their neighbors Bruce Dunlevie, a founding companion on the funding agency Benchmark, and his spouse, Elizabeth, mentioned the developments had been in battle with Atherton’s Heritage Tree Ordinance, which regulates tree elimination, and would create “a town that is no longer suburban in nature but urban, which is not why its residents moved there.”
Other residents additionally objected: Andrew Wilson, chief government of the online game maker Electronic Arts; Nikesh Arora, chief government of Palo Alto Networks, a cybersecurity firm; Ron Johnson, a former prime government at Apple; Omid Kordestani, a former prime government at Google; and Marc Andreessen, a distinguished investor.
All of them had been preventing a plan to assist Atherton adjust to state necessities for housing. Every eight years, California cities should present state regulators that they’ve deliberate for brand new housing to satisfy the expansion of their neighborhood. Atherton is on the hook so as to add 348 items.
Many California cities, significantly ones with wealthy individuals, have fought higher-density housing plans in current years, a development that has turn out to be referred to as NIMBYism for “not in my backyard.” But Atherton’s state of affairs stands out as a result of of the acute wealth of its denizens — the common residence sale in 2020 was $7.9 million — and since tech leaders who stay there have championed housing causes.
The firms that made Atherton’s residents wealthy have donated big sums to nonprofits to offset their influence on the native economic system, together with driving housing prices up. Some of the letter writers have even sat on the boards of charities geared toward addressing the area’s poverty and housing issues.
Atherton residents have raised objections to the developments despite the fact that the city’s housing density is extraordinarily low, housing advocates mentioned.
“Atherton talks about multifamily housing as if it was a Martian invasion or something,” mentioned Jeremy Levine, a coverage supervisor on the Housing Leadership Council of San Mateo County, a nonprofit that expressed help for the multifamily townhouse proposal.
Atherton, which is a component of San Mateo County, has lengthy been recognized for shying away from growth. The city beforehand sued the state to cease a high-speed rail line from operating by it and voted to shutter a practice station.
Its zoning guidelines don’t permit for multifamily houses. But in June, the City Council proposed an “overlay” designating areas the place 9 townhouse developments may very well be constructed. The majority of the websites would have 5 or 6 items, with the most important having 40 items on 5 acres.
That was when the outcry started. Some objectors supplied inventive methods to adjust to the state’s necessities with out constructing new housing. One expertise government urged in his letter that Atherton strive counting all of the pool homes.
Others spoke immediately about their residence values. Mr. Andreessen, the enterprise capitalist, and his spouse, Laura Arrillaga-Andreessen, a scion of the true property developer John Arrillaga, warned in a letter in June that multiple residence on a single acre of land “will MASSIVELY decrease our home values, the quality of life of ourselves and our neighbors and IMMENSELY increase the noise pollution and traffic.” The couple signed the letter with their deal with and an obvious reference to 4 properties they personal on Atherton’s Tuscaloosa Avenue.
The Atlantic reported earlier on the Andreessens’ letter.
Mr. Andreessen has been a vocal proponent of constructing every kind of issues, together with housing in the Bay Area. In a 2020 essay, he bemoaned the shortage of housing constructed in the United States, calling out San Francisco’s “crazily skyrocketing housing prices.”
“We should have gleaming skyscrapers and spectacular living environments in all our best cities,” he wrote. “Where are they?”
Other enterprise capital traders who stay in Atherton and oppose the townhouses embrace Aydin Senkut, an investor with Felicis Ventures; Gary Swart, an investor at Polaris Partners; Norm Fogelsong, an investor at IVP; Greg Stanger, an investor at Iconiq; and Tim Draper, an investor at Draper Associates.
Many of the most important tech firms have donated cash towards addressing the Bay Area’s housing disaster in current years. Meta, the corporate previously referred to as Facebook, the place Mr. Andreessen is a member of the board of administrators, has dedicated $1 billion towards the issue. Google pledged $1 billion. Apple topped them each with a $2.5 billion pledge. Netflix made grants to Enterprise Community Partners, a housing nonprofit. Mr. Arora of Palo Alto Networks was on the board of Tipping Point, a nonprofit targeted on preventing poverty in the Bay Area.
Mr. Senkut mentioned he was upset as a result of he felt that Atherton’s townhouses proposal had been accomplished in a sneaky method with out enter from the neighborhood. He mentioned the potential for elevated site visitors had made him involved concerning the security of his kids.
“If you’re going to have to do something, ask the neighborhood what they want,” he mentioned.
Mr. Draper, Mr. Johnson and representatives for Mr. Andreessen, Mr. Arora and Mr. Wilson of Electronic Arts declined to remark. The different letter writers didn’t reply to requests for remark.
The quantity of responses led Atherton’s City Council to take away the townhouse portion from its plan in July. On Aug. 2, it as an alternative proposed a program to encourage residents to lease out accent dwelling items on their properties, to permit individuals to subdivide properties and to doubtlessly construct housing for lecturers on college property.
“Atherton is indeed different,” the proposal declared. Despite the city’s “perceived affluent nature,” the plan mentioned, it’s a “cash-poor” city with few people who find themselves thought of in danger for housing.
Rick DeGolia, Atherton’s mayor, mentioned the difficulty with the townhouses was that they’d not have match the state’s definition of inexpensive housing, since land in Atherton prices $8 million an acre. One developer advised him that the items might go for not less than $4 million every.
“Everybody who buys into Atherton spent a huge amount of money to get in,” he mentioned. “They’re very concerned about their privacy — that’s for sure. But there’s a different focus to get affordable housing, and that’s what I’m focused on.”
Atherton’s new plan wants approval by California’s Department of Housing and Community Development. Cities that don’t adjust to the state’s necessities for brand new housing to satisfy neighborhood development face fines, or California might usurp native land-use authority.
Ralph Robinson, an assistant planner at Good City, the consulting agency that Atherton employed to create the housing proposal, mentioned the state had rejected the overwhelming majority of preliminary proposals in current occasions.
“We’re very aware of that,” he mentioned. “We’re aware we’ll get this feedback, and we may have to revisit some things in the fall.”
Mr. Robinson has seen related conditions play out throughout Northern California. The key distinction with Atherton, although, is its wealth, which attracts consideration and curiosity, not all of it optimistic.
“People are less sympathetic,” he mentioned.