Our Growing Region

Palo Alto’s location in the Silicon Valley region contributes to its economic prosperity, but also creates intense pressure for continued development and growth. Traffic congestion, parking scarcity, and high housing costs are issues associated with the growth of Silicon Valley. The Comp Plan for Palo Alto must recognize this context, preserve Palo Alto’s livability, and chart a course for our future. The Comp Plan defines where and how Palo Alto will grow, and how the City can maintain its reputation for innovation while providing a livable, sustainable environment for future generations. The pressures of regional growth and change mean that doing nothing—that is, not updating the current Comprehensive Plan—is simply not an option.


As incomes in Silicon Valley rise and job growth continues, median rent and sale prices for homes are increasing as well. According to the 2016 Silicon Valley Index, the median sale price of a single family home was $830,000 (2015) – more than double the median price of $411,000 in California as a whole; the median rental rate was $2,749/month (2015) for apartments, about 35 percent higher than the median rent of $1,930 in California. , About three out of ten homeowners and four out ten renters spend more than 30 percent of their combined incomes on housing costs. Additionally, people are continuing to move to the Silicon Valley region: between 2014 and 2015, the population increased about 1.3%, compared to an increase of 0.9% in California. This increase continues an upward trend in migration to the region since 2010.


Employment in Silicon Valley is growing across almost all commercial and industrial sectors. Rising venture capital investment in local companies, innovations in science and engineering, and renewed small-business loan activity are contributing to the current trend in regional employment growth. New office space is the dominant form of commercial real estate development. This growth in employment and commercial development, while for a boost to the regional economy, contributes to conditions that impact our city. Perhaps most strikingly, most people who work in Silicon Valley- —about 75% of the workforce—are driving to work alone.

Independent of commuting to jobs in Palo Alto from other places in Santa Clara County, at last count about 55,000 people who live in Santa Clara County commute northward through Palo Alto but do not work in the city. At the same time, more than 75,000 people commute southward from their homes on the Peninsula and in San Francisco to jobs located primarily in or south of Palo Alto. Some of these commuters are opting to use Middlefield Road, Alma Street, El Camino Real and other Palo Alto roadways as a way to avoid traffic on Highway 101 and Interstate 280.


Palo Alto residents and City officials are environmentally proactive. Use of solar power, alternatively-fueled motor vehicles, and recycled water is increasing in popularity at local homes, businesses, and government facilities. Meanwhile, electricity consumption is trending downward locally, and the City-owned utility now provides only carbon-neutral power. The City Council has committed to an aggressive goal of reducing GHG emissions to 80 percent below 1990 levels by 2030 through the City’s ambitious, ongoing Sustainability and Climate Action Plan (S/CAP) process.

Palo Alto also includes sustainable transportation options. Palo Alto’s multi-modal transit stations are second only to San Francisco in Caltrain ridership. The highly transit-accessible business districts Downtown and along California Avenue are complemented by a variety of residential neighborhoods, an abundance of parks and community facilities, and hillside and bayfront open space. This unique mix of urban development and natural preservation defines the character of Palo Alto.

So how can the City manage the pressures of growth while preserving the quality of life, neighborhoods, open space, and the environment in Palo Alto? The solutions originate with the Palo Alto community, and will be embodied in our Comprehensive Plan—Our Palo Alto 2030. Potential solutions include participating in regional transportation discussions, supporting walking, biking, transit use, and carpooling, and identifying solutions for housing affordability.