PALO ALTO -- You're a well-paid professional. You work in tech. You've got it made. 
 
 Not if you want to buy a house in Silicon Valley. 
 
 On Wednesday, a planning commissioner here became the very public voice of the region's frustrations over spiraling housing costs when she published her resignation letter to the city of Palo Alto. It said that she and her husband are moving to Santa Cruz because -- even with their combined incomes as a tech lawyer and software engineer -- they can't afford to live in this upscale city. 
 
 After five years of "trying to make it work in Palo Alto, my husband and I cannot see a way to stay in Palo Alto and raise a family here," Planning and Transportation Commissioner Kate Downing wrote in her public resignation letter. 
 
 The letter makes personal what the numbers show: That rising rents and home prices of recent years have put the region beyond the reach of many, even some at the top of the heap -- including in the lucrative tech industry that fuels the rush for housing. 
 
 The average rent in Palo Alto was $3,463 in the second quarter of 2016, according to a report last month from Novato-based RealFacts. In June, the median price of a single-family home was $1.2 million in San Mateo County and $982,500 in Santa Clara County, according to the CoreLogic real estate information service. 
 
 Downing, 31, has a full-time job as senior corporate counsel to a tech company in Santa Clara. In an interview, she explained that her letter "is not supposed to be a sad story about me. I'm going to land on my feet. I'm extraordinarily lucky and privileged. I'm going to be fine." 
 
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 Rather, she characterized the letter as a warning call about economic trends and failed policies that are hurting Palo Alto and the region. "It's clear," she wrote, "that if professionals like me cannot raise a family here, then all of our teachers, first responders and service workers are in dire straits." 
 
 Downing and her engineer husband, Steve Downing, 33, share a 2,300-square-foot, four-bedroom house in Palo Alto's Ventura neighborhood with another couple. The monthly rent is $6,200. 
 
 "That's actually pretty cheap for here," she said in the interview. "We probably pay on the low end of what they could get for our home." 
 
 Her letter calculated that if the couple "wanted to buy the same home and share it with children and not roommates, it would cost $2.7 million, and our monthly payment would be $12,177 a month in mortgage, taxes and insurance. That's $146,127 per year -- an entire professional's income before taxes. This is unaffordable even for an attorney and a software engineer." 
 
 The Downings based those numbers on putting 20 percent down: "If you put down less than that, you're not going to get picked," she said. "Everyone knows how competitive it is in Palo Alto, with multiple offers on every house. Some of them are putting down all cash. They're coming in with just gigantic deposits." 
 
 Downing's letter, a colleague said, is a timely commentary on Palo Alto's changing demographics: "All of us who are in our 20s and 30 and 40s -- we're used to seeing people leave," said Elaine Uang, a co-founder with Downing of the community group Palo Alto Forward. 
 
 "You never know when your friends are going to go because there aren't the right housing options here for them to pursue the next stage of life." 
 
 A commissioner since November 2014, Downing said in the letter that the city has failed to move the dial on housing. Stating that her own recommendations to the City Council have gone nowhere, she outlined some of the ways in which the housing supply might be expanded in order to "make a dent in the jobs-housing imbalance that causes housing prices throughout the Bay Area to spiral out of control." 
 
 She mentioned "small steps like allowing two floors of housing instead of one in mixed-used developments," as well as legalizing duplexes, streamlining restrictions on granny units and "enforcing minimum-density requirements" so that developers will "build apartments instead of penthouses." Housing should be allowed, she wrote, above shops and offices in single-use areas like the Stanford Shopping Center. 
 
 "Kate does a good job summarizing the challenges we're facing as a community," said Councilman Cory Wolbach. "To say that Palo Alto has been slow to add housing is a very accurate statement. 
 
 "There's nothing shocking here," he added, in regard to Downing's letter. "Palo Alto certainly does not encourage high-density, smaller, more reasonably priced units. It's unfortunate but true." 
 
 Palo Alto "is not the family-oriented community it used to be," Downing said. In her estimation, it's becoming a place for "jet-setting executives and investors" who have neither the time or inclination to help out with block parties or join Neighborhood Watch. 
 
 "Young people are not moving here anymore. It used to be a place of innovation, where people created art and sculpture in their backyards or started companies in their garages. Now, it's more for people who are CEOs and executive vice presidents." 
 
 Contact Richard Scheinin at 408-920-5069, read his stories at www.mercurynews.com/richard-scheinin and follow him at Twitter.com/RealEstateRag. ||||| For the past two years, Kate Downing has been one of Palo Alto's most passionate advocates for building more affordable housing. 
 
 As one of the founding members of the citizens group Palo Alto Forward and a member of the city's Planning and Transportation Commission, she also has been a vehement critic of the city's recent tilt toward slow-growth policies, and its failure to address a housing shortage that many in the community and some on the City Council believe has reached a crisis level. 
 
 
 
 Kate Downing Kate Downing 
 
 "Time and again, I've seen dozens of people come to both Commission meetings and Council meetings asking Council to make housing its top priority," Downing wrote. "The City Council received over 1,000 signatures from Palo Alto residents asking for the same. In the annual Our Palo Alto survey, it is the top issue cited by residents. 
 
 "This council has ignored the majority of residents and has chartered a course for the next 15 years of this city's development, which substantially continues the same job-housing imbalance this community has been suffering from for some time now: more offices, a nominal amount of housing, which the Council is already laying the groundwork to tax out of existence, lip service to preserving retail that simply has no reason to keep serving the average Joe when the city is only available to Joe Millionaires." 
 
 In her resignation letter, Downing pointed to the city's difficulties in filling job openings in the Palo Alto Police Department and renewing contracts with the local teachers because of the "astronomical" cost of housing, not just in Palo Alto but "many miles in each direction." 
 
 It is clear, she wrote, that "if professionals like me cannot raise a family here, then all of our teachers, first responders, and service workers are in dire straits." 
 
 Downing herself is facing similar challenges, despite the fact that she is a corporate attorney and her husband is a software engineer at Palantir. For several years, they have been renting a home in the Ventura neighborhood. Now, they are preparing to move to Santa Cruz. 
 
 In her resignation letter, Downing wrote that "After many years of trying to make it work in Palo Alto, my husband and I cannot see a way to stay in Palo Alto and raise a family here." 
 
 "We rent our current home with another couple for $6,200 a month; if we wanted to buy the same home and share it with children and not roommates, it would cost $2.7M and our monthly payment would be $12,177 a month in mortgage, taxes and insurance," Downing wrote. "That's $146,127 per year -- an entire professional's income before taxes. This is unaffordable even for an attorney and a software engineer." 
 
 Downing also noted that over the last five years, she'd seen dozens of her friends leave Palo Alto and, in some cases, the Bay Area. She also said that she has seen friends from other states get job offers in Palo Alto and then turn them down whey they started to look at the price of housing. 
 
 "I struggle to think what Palo Alto will become and what it will represent when young families have no hope of ever putting down roots here, and meanwhile the community is engulfed with middle-aged jet-setting executives and investors who are hardly the sort to be personally volunteering for neighborhood block parties, earthquake preparedness responsibilities, or neighborhood watch," Downing wrote. "If things keep going as they are, yes, Palo Alto's streets will look just as they did decades ago, but its inhabitants, spirit, and sense of community will be unrecognizable. 
 
 "A once thriving city will turn into a hollowed out museum. We should take care to remember that Palo Alto is famous the world over for its residents’ accomplishments, but none of those people would be able to live in Palo Alto were they starting out today," she wrote. 
 
 Downing is hardly alone in urging the council to act with more urgency on promoting affordable housing. In March, more than 1,000 residents, including numerous former mayors and planning commissioners, signed a petition spearheaded by Palo Alto Forward that urged the council to do more to address this topic. 
 
 "The cost of living in Palo Alto has skyrocketed. As a result, we are seeing long-time neighbors move because they can no longer afford the rent," the petition stated. "It is not unusual for Palo Alto workers to commute in from areas as far as Stockton, Gilroy and Tracy, putting severe strain on our roads and our climate. We are on the path to being a city composed only of long-time landowners and wealthy newcomers. This situation is the result of city policies that have discouraged new housing while encouraging more office space." 
 
 Recent surveys also suggest that residents are growing increasingly anxious about getting priced out of Palo Alto. In the city's annual survey, the number of people who gave Palo Alto good grades for "variety of housing options” dropped from 27 percent in 2014 to 20 percent in 2015, while the percentage of people who ranked the city as a good or excellent place to retire dropped from 60 percent to 52 percent between 2014 and 2015 (in 2006, it was 68 percent). 
 
 Local concerns about housing were also highlighted in a poll that the city commissioned last spring, when it was considering whether to proceed with a business tax to address traffic congestion. The poll showed 76 percent of the respondents listing "cost of housing" as an "extremely serious" or "very serious" problem, a higher percentage than any other issue (the drought and traffic congestion scored second and third, with 65 percent and 53 percent, respectively). 
 
 Downing's letter comes at a particularly sensitive time for local politics. The city is about to hold its first City Council election since the slow-growth "residentialist" camp won the council majority in 2014 and four of the council's nine seats will be up for grabs. 
 
 Several candidates jumping into the race, including current planning commission Chair Adrian Fine, Human Relations Commission Chair Greer Stone and technology executive Michelle Kraus (all of whom are renters) have vowed to make creation of more housing options a priority if elected. 
 
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 Follow the Palo Alto Weekly/Palo Alto Online on Twitter @PaloAltoWeekly and Facebook for breaking news, local events, photos, videos and more. ||||| In what’s becoming a regular story in the Bay Area, many Peninsula towns’ refusal to increase housing has led to a mass exit of long-time, working-class residents. First responders, police, teachers, grocery store clerks—the list goes on. 
 
 These small cities, rich with tech money and close-proximity desirability, have left it to San Francisco, Oakland, and only a few other areas to house the influx of new-moneyed arrivals. 
 
 And with that, another noteworthy exodus has taken place: Palo Alto Planning and Transportation commissioner Kate Vershov Downing and her family have decided to leave the pricey town for Santa Cruz because they, like many other residents, can no longer afford the area. 
 
 In a letter of resignation, she starts off saying: 
 
 Dear City Council Members and Palo Alto Residents, This letter serves as my official resignation from the Planning and Transportation Commission. My family has decided to move to Santa Cruz. After many years of trying to make it work in Palo Alto, my husband and I cannot see a way to stay in Palo Alto and raise a family here. We rent our current home with another couple for $6200 a month; if we wanted to buy the same home and share it with children and not roommates, it would cost $2.7M and our monthly payment would be $12,177 a month in mortgage, taxes, and insurance. That’s $146,127 per year — an entire professional’s income before taxes. This is unaffordable even for an attorney and a software engineer. 
 
 Downing goes on to note that the city council is, in part, to blame for this mess, noting that pleas from citizenry for more housing go ignored. 
 
 I have repeatedly made recommendations to the Council to expand the housing supply in Palo Alto so that together with our neighboring cities who are already adding housing, we can start to make a dent in the jobs-housing imbalance that causes housing prices throughout the Bay Area to spiral out of control. Small steps like allowing 2 floors of housing instead of 1 in mixed use developments, enforcing minimum density requirements so that developers build apartments instead of penthouses, legalizing duplexes, easing restrictions on granny units, leveraging the residential parking permit program to experiment with housing for people who don’t want or need two cars, and allowing single-use areas like the Stanford shopping center to add housing on top of shops (or offices), would go a long way in adding desperately needed housing units while maintaining the character of our neighborhoods and preserving historic structures throughout. Time and again, I’ve seen dozens of people come to both Commission meetings and Council meetings asking Council to make housing its top priority. The City Council received over 1000 signatures from Palo Alto residents asking for the same. In the annual Our Palo Alto survey, it is the top issue cited by residents. This Council has ignored the majority of residents and has chartered a course for the next 15 years of this city’s development which substantially continues the same job-housing imbalance this community has been suffering from for some time now: more offices, a nominal amount of housing which the Council is already laying the groundwork to tax out of existence, lip service to preserving retail that simply has no reason to keep serving the average Joe when the city is only affordable to Joe Millionaires. 
 
 Like Menlo Park, Palo Alto’s housing stock is extremely pricey. You can hardly find a home on the market right now for less than $1 million. And there’s no sign of things slowing down. 
 
 Read the entire piece here. ||||| Letter of Resignation from the Palo Alto Planning and Transportation Commission 
 
 Sorry, we’re full! 
 
 Dear City Council Members and Palo Alto Residents, 
 
 This letter serves as my official resignation from the Planning and Transportation Commission. My family has decided to move to Santa Cruz. After many years of trying to make it work in Palo Alto, my husband and I cannot see a way to stay in Palo Alto and raise a family here. We rent our current home with another couple for $6200 a month; if we wanted to buy the same home and share it with children and not roommates, it would cost $2.7M and our monthly payment would be $12,177 a month in mortgage, taxes, and insurance. That’s $146,127 per year — an entire professional’s income before taxes. This is unaffordable even for an attorney and a software engineer. 
 
 It’s clear that if professionals like me cannot raise a family here, then all of our teachers, first responders, and service workers are in dire straits. We already see openings at our police department that we can’t fill and numerous teacher contracts that we can’t renew because the cost of housing is astronomical not just in Palo Alto but many miles in each direction. I have repeatedly made recommendations to the Council to expand the housing supply in Palo Alto so that together with our neighboring cities who are already adding housing, we can start to make a dent in the jobs-housing imbalance that causes housing prices throughout the Bay Area to spiral out of control. Small steps like allowing 2 floors of housing instead of 1 in mixed use developments, enforcing minimum density requirements so that developers build apartments instead of penthouses, legalizing duplexes, easing restrictions on granny units, leveraging the residential parking permit program to experiment with housing for people who don’t want or need two cars, and allowing single-use areas like the Stanford shopping center to add housing on top of shops (or offices), would go a long way in adding desperately needed housing units while maintaining the character of our neighborhoods and preserving historic structures throughout. 
 
 Time and again, I’ve seen dozens of people come to both Commission meetings and Council meetings asking Council to make housing its top priority. The City Council received over 1000 signatures from Palo Alto residents asking for the same. In the annual Our Palo Alto survey, it is the top issue cited by residents. This Council has ignored the majority of residents and has charted a course for the next 15 years of this city’s development which substantially continues the same job-housing imbalance this community has been suffering from for some time now: more offices, a nominal amount of housing which the Council is already laying the groundwork to tax out of existence, lip service to preserving retail that simply has no reason to keep serving the average Joe when the city is only affordable to Joe Millionaires. 
 
 Over the last 5 years I’ve seen dozens of my friends leave Palo Alto and often leave the Bay Area entirely. I’ve seen friends from other states get job offers here and then turn them down when they started to look at the price of housing. I struggle to think what Palo Alto will become and what it will represent when young families have no hope of ever putting down roots here, and meanwhile the community is engulfed with middle-aged jet-setting executives and investors who are hardly the sort to be personally volunteering for neighborhood block parties, earthquake preparedness responsibilities, or neighborhood watch. If things keep going as they are, yes, Palo Alto’s streets will look just as they did decades ago, but its inhabitants, spirit, and sense of community will be unrecognizable. A once thriving city will turn into a hollowed out museum. We should take care to remember that Palo Alto is famous the world over for its residents’ accomplishments, but none of those people would be able to live in Palo Alto were they starting out today. 
 
 Sincerely, 
 
 Kate Downing 
 
 UPDATE: Thank you so much for the outpouring of interest and support. While we are leaving Palo Alto, the organization I co-founded that is working to invest in housing and transportation will continue on its work so that maybe in the future we can have a more inclusive community. If you’d like to learn more, go here. 
 
 If you’d like to look into the belly of the beast, read the comments on our local paper: Palo Alto Online. The loudest voices in the community feel that the desire to create more affordable housing is spoiled entitlement. Until renters, younger people, and people of more modest means organize, this problem will continue throughout the Bay Area. ||||| PALO ALTO -- Palantir Technologies is quietly taking over downtown Palo Alto. 
 
 While tech giants such as Apple and Uber make a public show of opening new Bay Area headquarters, Palantir -- a software company known for mining confidential data for the National Security Agency, FBI and CIA -- is leasing building after building with little fanfare. 
 
 Ranked as the third most valuable private company in the United States, Palantir rents about 20 downtown Palo Alto buildings. As the $20 billion company expands, it has brought legions of techies to downtown restaurants and coffee shops. But what one local investor dubbed the "Palantirization" of Palo Alto also has sparked concerns that the big-data giant has left little room for smaller startups. 
 
 "They own Palo Alto," said local entrepreneur Joe Beninato, founder of Internet startup S8. "There are Palantir people all over the place in Palantir shirts and hoodies. It's kind of like downtown is their office." 
 
 Launched in 2004 by a team that includes PayPal founder Peter Thiel, Palantir makes data analysis software that is rumored to have helped U.S. forces track down and kill Osama bin Laden and prosecutors convict Ponzi schemer Bernie Madoff. The company's products, named Gotham and Metropolis, comb through massive amounts of information to find connections between data points. Since much of that data is highly confidential, Palantir is notoriously tight-lipped about its work. 
 
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 But its popularity among government agencies and law enforcement has led to booming growth. Palantir employed 1,800 people last year and pulled in $1.5 billion in revenue -- showing more than 100 percent revenue growth over the year before, according to PrivCo, which aggregates and analyzes private company data. 
 
 Palantir declined to comment. 
 
 People line up to have their identities verified before entering the Palantir cafeteria at 542 High Street in Palo Alto, Calif., Thursday morning April 23, 2016. (Karl Mondon) 
 
 Unlike other fast-growing companies such as Apple, Google and Facebook, which consolidate employees in massive campuses, real estate experts say Palantir seems committed to making a long-term home in downtown Palo Alto. The private company hasn't released details about its office spaces, but information from researchers such PrivCo, real estate advisers, the city and Palantir's many landlords paints a picture of the company's expansion strategy. 
 
 PrivCo reports that the company currently rents more than 250,000 square feet in downtown Palo Alto. That's about 12 percent of all available commercial space in the downtown area, based on data from Jones Lang LaSalle, a Chicago-based commercial real estate services firm. 
 
 A sign for Palantir is visible at their headquarters at 100 Hamilton Ave Thursday morning April 23, 2016, in Palo Alto, Calif. (Karl Mondon) 
 
 Palantir's empire starts with its headquarters, a stately brick building on Hamilton Avenue. Employees eat at the company cafeteria around the corner on High Street, and some work in smaller offices scattered throughout downtown. Palantir rents additional special event space, kitchen space, and residential units to house visiting employees -- mostly within a half-mile radius of Hamilton Avenue. Recently, the company leased even more room in a historic building on the corner of Hamilton and Ramona Street. 
 
 To protect clients' sensitive information, Palantir also needs special high-security facilities that can't be penetrated electronically or physically by eavesdroppers, the company wrote in a 2009 blog post. These spaces, called Secure Compartmented Information Facilities, are fitted with shields that block cellphone reception, public Internet access and all other outside signals. If Palantir has such a facility in Palo Alto, it's keeping it low-profile. But that's the point, said Baltimore-based SCIF expert James Wallace of Gensler, an architecture firm. 
 
 "From the outside you would not be able to tell," he said. 
 
 For the Coupa Cafe, across the street from Palantir's new building, the company's expansion is both a blessing and a curse. The new office will bring in hundreds of potential customers, said owner Jean Paul Coupal, but it also contributes to rising rents. 
 
 "Palo Alto will become a town that serves $8 lattes," he said. 
 
 The company has made an effort to be neighborly, hosting coding classes for high school students and using its software to support a county effort to house the homeless. 
 
 Palantir, which reportedly signed a lease lasting more than 10 years for its new building, appears to be hunkering down just as other tech companies are leaving downtown Palo Alto. SurveyMonkey outgrew its Palo Alto headquarters and announced a move to San Mateo last summer. Pinterest moved to San Francisco in 2012. Smartwatch-maker Pebble and mobile marketing startup Kahuna moved to Redwood City last year. And Facebook, which had 10 buildings in downtown Palo Alto, moved into the Stanford Research Park in 2009 before ultimately settling in at its Menlo Park campus. 
 
 "They've gone a completely different route than what most companies have done," PrivCo analyst Evan Danckwerth said of Palantir. 
 
 There are plenty of benefits to a downtown campus. Easy access to Caltrain and restaurants, coffee shops and bars makes the location a boon for current employees and a handy recruiting tool. But it's getting more difficult for large startups to grow in Palo Alto. Average yearly rents for commercial spaces downtown have jumped from $71 per square foot to $102 in the past five years, according to JLL. Meanwhile, availability hit a seven-year low last year, dropping to less than 3 percent. The space crunch isn't likely to ease soon. The city recently limited development of new offices and some other commercial spaces to 50,000 square feet per year downtown, in the California Avenue area and along the El Camino corridor. 
 
 Palantir is planning for future growth by leasing some spaces that are larger than it needs, and subleasing to other businesses, said Bradley Van Linge of commercial real estate advisory firm Newmark Cornish & Carey. 
 
 Michael Evans, founder and CEO of Palo Alto-based Flosstime, partly attributes ballooning rent prices to Palantir's large presence. Flosstime, which makes a smart dental floss dispenser, can't afford to move out of the space it has outgrown in the garage behind Evans' house. But, he said, Palantir's expansion is part of the Silicon Valley cycle -- companies move in, grow, drive up prices and, in some cases, move on. 
 
 "I don't see that as negative," Evans said. "I see it as what downtown Palo Alto's about." 
 
 Marisa Kendall covers startups and venture capital. Contact her at 408-920-5009. Follow her at Twitter.com/marisakendall.
– Palo Alto's planning and transportation commissioner sat down and did the math: For Kate Vershov Downing and husband Steve to purchase a home similar to the 4-bedroom, 2,300-square-foot dwelling they currently rent (with another couple, at $6,200 a month), their monthly payment would be $12,177. That's $146,127 a year on mortgage, insurance, and taxes, and that's assuming they had half-a-million dollars for a down payment. "This is unaffordable even for an attorney and a software engineer," she writes; she's senior corporate counsel to a tech company and her husband works for Palantir. And so after five years of trying to make it work in Silicon Valley, the Downings, "cannot see a way to stay in Palo Alto and raise a family," Kate writes in a public resignation letter posted Tuesday announcing her move to Santa Cruz. She tells the Mercury News that her letter "is not supposed to be a sad story about me. ... I'm extraordinarily lucky and privileged." But she writes that "it's clear that if professionals like me cannot raise a family here, then all of our teachers, first responders, and service workers are in dire straits." Indeed, Curbed SF backs up its assertion that there's little on the market there for less than $1 million with a link to Redfin, which, for example, has a listing for a $729,000 house ... that's 529 square feet. In her letter, Downing—called "one of Palo Alto's most passionate advocates for building more affordable housing" by Palo Alto Online — takes the City Council to task for ignoring residents' clamor for significant change on the housing front; her letter repeats some of the recommendations she herself has made. (Palantir is having a profound effect on the city's commercial space.)