As Palo Alto prepares to unveil a new and long-awaited vision for the eclectic neighborhood around Fry's Electronics, a group of dense, new developments is winding its way through the city's development pipeline, threatening to significantly alter the facts on the ground.

The latest of these, a mixed-use project around 3159 El Camino Real, earned the green light from the City Council on Monday, raising fresh concerns from residents about building height, traffic congestion and parking impacts. The council voted 7-2, with Councilwoman Karen Holman and Councilman Greg Schmid dissenting, to approve the 74,122-square-foot development.

The project near Portage Avenue comes at a sensitive time for new developments in Palo Alto, just weeks after voters overwhelmingly overturned an approved housing development on Maybell Avenue and just days before the city's Planning and Transportation Commission was due to review an "area concept plan" for the neighborhood around California Avenue and the Fry's site, a broad, community-driven document that took about four years to put together.

Designed by Fergus Garber Young Architects, the proposed four-story, 55-foot-high building would go up around Equinox Gym at a site currently occupied by "We Fix Macs." In its design, it speaks to both the city's dreams and the residents' nightmares about new developments in Palo Alto.

With its 48 small apartments, a restaurant, office space and an underground lot with stacked "puzzle parking" stations, the project is exactly the kind of "true mixed-use" development the city has been trying to encourage in transit corridors and commercial thoroughfares. The development is also consistent with the underlying "service commercial" (CS) zoning, a key consideration at a time when other major developments in this area are requesting zone changes to enable greater density.

These factors helped the proposed development win approval from both the city's Planning and Transportation Commission and its Architectural Review Board. Lee Lippert, a member of the architecture board, stressed during the board's review the importance of getting the project "right" and said the development "has the ability to be the driving force for other mixed-use projects." On Monday night, Councilman Larry Klein likewise lauded the development, saying that its compliance with underlying zone leaves the council with little discretion to reject it. By contrast, the Maybell development that voters rejected when they shot down Measure D on election day requested a change to a "planned community" (PC) zone, a highly controversial process in which zoning rules are tossed out in exchange for public benefits to be negotiated.

"What's ironic is that we heard a lot of statements during the last campaign that citizens wanted us to follow the zoning and not make any changes such as a PC … If we're going to be consistent and sincere, we have to recognize when something is within existing zoning," Klein said.

Councilwoman Liz Kniss agreed and stressed the project's compliance with the zoning code in explaining her support.

"The discussion I heard most often from those who spoke about Measure D was that it was spot zoning," Kniss said. "I heard that literally as the main argument. What we're dealing with tonight is real zoning -- zoning that's been in place."

Yet the project has also stirred concern from residents, both in the immediate Ventura neighborhood and in the wider community. Much like in the debate over the Maybell project, residents stressed the need to consider the new development at 3159 El Camino in conjunction with other dense proposals in this area, including the proposed four-story office building at 2755 El Camino Real and Jay Paul's giant commercial development at 395 Page Mill Road, which would bring 311,000 square feet of office space to one of the city's most congested locations.

The project would provide 216 parking spots, including 196 on "puzzle lifts." But because the development includes affordable housing, it is entitled under state law to receive a density bonus of 4,619 square feet. State incentives will also allow the project to provide only 49 parking spaces for the residential component, 31 fewer than would be required under the city's standards. Councilman Marc Berman said he was "as frustrated as anyone" about that but noted that "we can't change that because it's state law."

Several residents, including those involved in the Measure D campaign, pleaded with the council on Monday not to move forward with this proposal until they have a traffic model in place that evaluates the cumulative impacts of all the new developments rather than looks at each on in isolation. Among them was Art Liberman, president of Barron Park Association, which led the opposition to Measure D.

"For developments in Palo Alto, a few hundred extra trips here, a few hundred extra trips there, and you're talking about real congestion," Liberman said. "Palo Alto is doing that in this area and that's wrong."

Marilyn Mayo, who lives close to the project site, also worried about the traffic impacts of the new development and told the council that the "quality of life has diminished in Palo Alto," partly because of the impacts of new developments. She noted that the project's site is at the "epicenter of development" in Palo Alto.

A few council members sympathized with the speakers. Councilman Greg Schmid voiced skepticism about the traffic study conducted by the city's transportation consultant, which showed the project adding fewer than 100 cars to the busy area, both during the morning and the afternoon peak hours. Councilwoman Karen Holman also criticized the project, mainly along architectural grounds. She challenged the architectural board's findings that the project meets with the appropriate design guidelines, particularly ones focusing on transitions between new developments and existing buildings.

"It's pretty stunning," Holman said. "It's a block long. It's going to have an enormous effect and impact on that area."

Even so, the project received the green light, with most members recognizing that their discretion is limited. Council members, Klein said, have to follow state law, even if it means granting unpopular density and parking exemptions. The council did agree to two "design enhancement exemptions," one allowing the height to be 55 feet (5 feet greater than the city's height limit) and another that would allow greater setbacks from the sidewalks than the city's code normally calls for.

"A lot of the speakers from the public seem to think we have a lot more power than we do," Klein said.

Councilwoman Gail Price, who seconded Klein's motion to approve the project, was more enthusiastic than most of her colleagues, calling the proposed building "well-designed" and stressing the importance of building new housing units.

"I think we do need to have a variety of housing products in the community to address the broad range of housing needs," Price said, adding that smaller housing units provide "different opportunities for people."

Vice Mayor Nancy Shepherd acknowledged the political realities of supporting for new developments and noted that there are many reasons why many residents won't vote for her in 2014, when her term is up. At the same time, she said she supports the project because it follows the zoning laws.

"These are the property rights in our Comprehensive Plan," Shepherd said. "We've been asked to follow them. We are following them."