Menlo Park last week moved forward with plans to convert three downtown parking lots into high-density housing, aiming to add hundreds of affordable units amid soaring housing costs, while preserving public parking for downtown businesses that say they are still struggling to recover from pandemic lockdowns.

The city released its official request for proposals Monday, following city council guidance last month. The plan requires developers to include at least 345 units for households earning 15% to 80% of the area median income, which for a single person in San Mateo County ranges from $19,590 to $104,480.

Six developers have been invited to submit proposals: Alliant Communities, Eden Housing, MidPen Housing, PATH Ventures, Presidio Bay Ventures, and a joint venture between Related Companies and Alta Housing.

Developers have until Dec. 15 to submit proposals and are required to replace all 556 existing public parking spaces, a key concern for project opponents. Officials say the project is intended to boost downtown vibrancy, support local businesses, and provide “high-quality, sustainable housing.”

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“All three sites are within walking and cycling distance of the Caltrain station and El Camino Real,” the city said in an announcement Monday, noting that the goal is to provide housing close to jobs, services and mass transit.

City staff said during a council meeting last month that the proposals will be assessed based on the development concept, the team’s experience and financial capacity, community benefits and engagement plan, and the quality of long-term property management. They said public feedback will continue to play a role in the selection process.

The project’s development and debate — which drew hundreds of supporters and opponents when it appeared on the agenda in January, following several study sessions late last year — highlight the city’s push to build affordable housing in a high-cost region. At the same time, city officials are working to address residents’ concerns about how new development could affect the local economy and quality of life.

In San Mateo County, those earning under $109,700 are considered low-income. Menlo Park’s state-mandated housing targets call for nearly 3,000 new homes by 2031, including over 1,600 affordable units for moderate- and low-income households.

Still, the potential closure of the parking lots has divided the community.

At the center of the debate is whether the housing development benefits outweigh the risks to existing businesses. Opponents say removing parking spaces — even temporarily — could hurt merchants still recovering from the pandemic.

Save Downtown Menlo Park, a group opposing the project, sued the city in April, arguing the parking lots belong to the public and should not be used for private development without voter consent.

“Five council members should not be able to give away public land to implement an unpopular plan that would forever change our downtown,” Alex Beltramo of Save Downtown Menlo Park said in a text message Tuesday.

In its request for proposals document published on Monday, the city called the group’s lawsuit “misguided and without merit.”

Beltramo’s group is also collecting signatures for a ballot initiative that, if passed, would require the city seek voter approval before it can redevelop downtown land.

Backers must gather signatures from at least 10% of Menlo Park’s roughly 20,000 registered voters to qualify the measure for the ballot. According to Beltramo, the group has already surpassed that threshold and will continue collecting signatures until the initiative is officially filed, though he declined to disclose the campaign’s running total.

While Save Downtown Menlo Park opposes the project, the group says it isn’t anti-housing. It argues that removing easily accessible parking could drive away longtime downtown patrons and that new housing would be better suited for the nearby Civic Center.

Supporters of the downtown housing redevelopment say the city cannot afford delays amid a worsening housing crisis and argue that new residents would increase foot traffic and expand the customer base for local businesses.

Sustainable housing advocate Jordan Grimes of Greenbelt Alliance said that even if the 3,000 units Menlo Park is required to build are a “drop in the bucket,” they remain critical to addressing the city’s housing shortage.

“Menlo Park has added tens of thousands of jobs over the last decade, since Facebook took root in the city, and has added very few new homes,” Grimes previously told this news organization. “So it has created this really extreme shortage.”