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As Mountain View enters the third year of a 10-year plan to revitalize the local economy, the city is seeing retail vacancies trending down in the heart of town, while downtown office vacancies are increasing.
The retail vacancy rate in the downtown area was 6.1% in April, down from 8.5% two years ago. In contrast, the downtown office vacancy rate sat at 31.5%, up from 25% in 2024. The data came as part of an annual progress report on Mountain View’s Economic Vitality Strategy, which the City Council unanimously approved at a May 26 meeting.
In the report, city staff highlighted their efforts to implement various initiatives, including zoning code updates meant to help small businesses, direct grants for storefront improvements and the installation of public art around town.
“We’ve done a really effective job at having a broad portfolio of programs and strategies,” Economic Vitality Manager Amanda Rotella told the Council members.
In total, the city has completed 6 out of the 164 action items that are outlined in the Economic Vitality Strategy. Another 71 are in progress and 38 are considered ongoing actions without a defined end point. That leaves the city with 49 items that haven’t yet been started.
To judge the effectiveness of its work, the city has developed more than a dozen “measures of success” for the strategy, including the office and retail vacancy rates. Many of the metrics are trending in a positive direction, including a 10.1% year-over-year increase in downtown sales tax receipts and an increase in the number of downtown businesses.
The Economic Vitality Strategy’s overarching goal is to align residents, business owners and city leadership around a “shared economic vision” that fosters a strong community and economy, the staff report said.
Staff touted the city’s recent creation of an “entertainment zone” in the downtown area, which allows public drinking along parts of Castro Street during special events. The city plans to activate the zone during upcoming World Cup soccer games. The city also pointed to its work to launch a pop-up shop selling art by Bay Area artists in a formerly vacant Castro Street storefront.
Council member Lucas Ramirez praised city staff for their progress thus far, but raised concerns about “the erosion of the industrial base” in Mountain View. He suggested adding a metric tracking the share of the city’s land zoned for industrial uses, along with a target percentage to stay above.
“As we approach that percentage, we should start to be very mindful about industrial-to-residential conversions, or any other land-use change that continues to erode our industrial base,” Ramirez said.
Tackling downtown office vacancies
In their report, city staff outlined their priorities for the next year of the Economic Vitality Plan, including targeting downtown office vacancies. The city plans to focus on strengthening its relationship with commercial property owners and brokers through efforts like the “Broker Breakfast” series.
City spokesperson Lenka Wright told the Voice that a major contributor to office vacancies in the heart of the city was the departure of Confluent after it was acquired by IBM. The tech company had been headquartered at 899 W. Evelyn Ave., near the downtown transit center. Additionally, she said that remote work has reduced the demand for traditional office spaces.
“More broadly, higher downtown office vacancy rates reflect market trends affecting downtowns throughout the Bay Area and beyond,” she wrote in an email.
The city is evaluating strategies to attract and retain office space tenants, as well as potential opportunities to repurpose vacant offices, Wright said.
