At first glance, Facebook’s plan to partner on an apartment building within walking distance of its Menlo Park headquarters sounds like an extension of its utopian work environment. The company already feeds its employees three meals each day, does their dry cleaning, fixes their bikes and offers them unlimited free lattes. Housing units to match their already company-catered lives fit the mold.
But conversations with several local real estate agents paint a slightly different picture. Facebook employees have limited affordable housing options near campus, and many housing developers consider the other side of Menlo Park a better investment.
The most apparent issue with attracting new housing near Facebook is schools.
In west Menlo Park, where the city’s downtown is located, two elementary schools perform among the top 10% of all schools in California. A third is in the top 20%. But the elementary school that serves the area immediately surrounding Facebook’s campus, in the east side of the city, ranks in the lowest 10% of schools in the state. This makes the area immediately near Facebook less appealing to families.
UPDATE: The developer of the apartment complex says that it will be built 1.5 miles away in the Redwood City School district rather than immediately next to Facebook's campus. The elementary school in the Redwood City School District nearest to Facebook's campus ranked four out of ten in California's state rankings.
Keri Nicholas, a real estate agent who has sold homes in Menlo Park for 22 years, says one of her clients recently asked her if he should invest in property on the city’s east side. She advised him against it. “You might be on the ground floor, but at the same time,” she says. “The whole area would have to turn over.”
Meanwhile, other areas of Menlo Park are often simply unaffordable. Menlo Park’s residents have a median household income of $148,878, more than twice that for residents of California in general. The city’s median home price is nearly S1 million. “There are more people moving here every day coming to jobs and nowhere to live," says Penelope Huang, a broker and owner at RE/MAX Distinctive Properties in Menlo Park. "Rental prices are going through the roof.” Getting an apartment is competitive. One 600–square-foot apartment Nicholas helped rent recently for $2,200 per month had 22 applications, about half of them from Facebook employees.
Facebook’s new apartment complex, the first major housing development project in the area in 20 years, could help Menlo Park’s tight real estate situation, but its relevance is likely narrow. It includes:
Though Facebook says that all but 15 units of its planned complex will be open to people who don’t work at Facebook, it’s unclear who else would be interested in living there.
The building is planned within walking distance of Facebook, and it will therefore offer proximity to pretty much nothing else. The ambiance and amenities of downtown Menlo Park are located in the west side of the city. Meanwhile, amenities like a yoga studio with personal trainers and pet spa could cut into the discount obtained by living on the east side.
In particular, young Facebook employees
Unless the building is somehow zoned in a different school district than Facebook's campus would fall into if it were a residential address (UPDATE: it is), employees who have children are likely to spend their expensive rent at a residence located in a district with better schools.
A handful of low income housing occupants
As part of its agreement with the city, Facebook and its partner will offer 15 below-market-rate units in the complex. Market average rent in San Mateo, where Menlo Park is located, was $2,053 for a one-bedroom apartment as of June.
Total Facebook nuts
We’re not sure who loves Facebook enough to move into the company's apartment building, but we wouldn’t be surprised if he or she showed up. Is it you? Tell us in the comments. Or email email@example.com. We have some questions for you.
[Image: Flickr user Jenni Douglas]