Facebook is getting into real estate. This week, the company proposed building 1,500 apartments near its campus in Menlo Park, California, 15 percent of which it would set aside for low-income families. Urban planners and local developers call it a generous gesture that could bring sorely needed housing to the area.

Facebook isn’t being totally altruistic here. The company plans to hire 6,500 employees within the next few years. To accommodate them, it wants to build two new office buildings and a 200-room hotel on a 58-acre plot of land kitty-corner from its original campus. But many locals, including former Menlo Park mayor Steve Schmidt, aren’t on board with the idea. Earlier this month, in a letter to Menlo Park senior planner Kyle Peralta, Schmidt argued Facebook’s expansion would increase automobile traffic and hike up home prices in what’s already one of the most expensive regions in the US.

Technology companies are playing an increasingly large role in how cities grow—and not always for the better. The Wall Street Journal reports that San Mateo and Santa Clara counties—the heart of Silicon Valley—added 385,000 jobs between 2010 and 2015, but only 58,000 housing units. Unparalleled demand has led to overcrowding, soaring home prices, and fleets of corporate shuttle buses prowling the Bay Area—so companies seeking to expand there often face significant pushback. Facebook is among the latest, and biggest, to experience that resistance.

To appease naysayers, Facebook is making ambitious promises. The housing plan is part of a $15-million community benefits package intended to rally support for the company’s expansion. It isn’t nearly enough to fix all that ails Silicon Valley, but it is an uncommonly civic-minded move for a tech company.

“Facebook planning for housing on its own land is exactly the kind of thing we need,” says Gabriel Metcalf, director of the San Francisco Bay Area Planning and Urban Research Association. That’s because, historically, residential construction in the region has been hamstrung by zoning and development regulations. (Silicon Valley zoning laws, for instance, have long favored commercial development, which generates more tax revenue than apartments.) “We have put in place so many rules and regulations against housing development that we’ve made our housing supply inelastic,” Metcalf says.

It’s also why affordable housing advocates in Silicon Valley support Facebook’s plan, even while acknowledging that it isn’t enough to compensate for 6,500 new hires. “It’s not easy to build 1,500 units—you need the land, you need the funding, you need city approvals,” says Candice Gonzalez, president and CEO of Palo Alto Housing, an affordable housing agency she says has managed to build just 800 units since 1970. When it comes to addressing the issue of housing supply, she says, “every little dent helps.”

Less clear is how helpful Facebook’s plan would be for people earning less than Facebook-class wages. Median income in San Mateo county is $91,421 according to data from the 2014 Census Bureau, while the average asking rent in San Mateo county is $2,878. Ezra Haber Glenn of MIT’s School of Urban Planning and Development, says reserving 15 percent of the planned units for low-income residents is a good start, but does little to address the ongoing displacement of working class families throughout the Bay Area. He’s also dubious that the new housing units would be for the general public. “Even if it’s not earmarked for Facebook employees, it might be for the types of people they’re trying to attract,” Glenn says.

He’s not wrong. “The housing crisis isn’t just impacting extremely low income, it goes well into the moderate income realm,” says Matt Franklin, president of MidPen, an affordable housing nonprofit in San Mateo that worked with Facebook to develop the housing benefits package. He says Facebook employees, and potential employees, are put off by the rising cost of real estate, too. “It makes it hard to recruit employees from other cities,” Franklin says. For Facebook, building apartments is about more than goodwill, he adds. “It’s in their own self-interest.”

But Franklin insists that Facebook’s plan isn’t totally self-serving. The company’s only legal requirement is to pay the $6.3 million in below market rate fees, which the city requires of any company developing commercial real estate. The fee is based on the size of the development and goes to a fund for building affordable housing. “The rest is above and beyond,” he says, referring to Facebook’s other promises.

In addition to the 1,500 units, Facebook has pledged to dedicate $1.5 million to a housing innovation fund to research creative ways to solve the housing crisis; $1 million to a housing preservation fund to protect at-risk homes; $2.5 million to a workforce housing program that will reduce rents for 22 housing units for local teachers; and $350,000 towards a housing study designed to identify issues in the housing market.

To some, the housing package is simply a better-than-average deal sweetener. To others, it reads as a mea culpa. Either way, Gonzalez says, it’s totally necessary. “Whether or not they’re doing it just to get approvals, the bottom line is they are doing it,” she says. “And we’ll take the housing.”

Visit site: 

Facebook Apartments Won’t Fix Housing—But They’re a Good Start