RH Is Reshaping a Corner of Old Town. Here's What It Means for Los Gatos.
One of the most visible vacancies in downtown Los Gatos is finally getting filled and by a name most residents already know.
RH, the luxury home furnishings company formerly called Restoration Hardware, received unanimous Town Council approval to take over roughly 15,957 square feet at 31 University Avenue in Old Town. The space previously held Steamer's The Grillhouse and Gap, and portions of it have sat empty since 2023. RH plans a combined design gallery and restaurant, the format the company now uses in its flagship locations.
This is an expansion, not an arrival. RH has operated a gallery on North Santa Cruz Avenue for about fifteen years. Company representatives have raised the question of what happens to that location — one possibility floated publicly was converting it to an RH Outdoor store.
What the Council actually approved
The project required three separate approvals, which is worth understanding because it explains why the process drew as much attention as it did:
- An amendment to the planned development ordinance governing that section of Old Town, originally adopted in 1996
- An architecture and site filing covering exterior changes
- A conditional use permit for formula retail exceeding 10,000 square feet, including a restaurant with alcohol service
The ordinance amendment is the substantive one. The 1996 planned development anticipated separate, joined structures with distinct facades. RH proposed replacing that with a single unified Mediterranean-style exterior, arguing it fits the surrounding architectural context better than the current arrangement.
The company's senior VP of architecture and design presented the concept alongside RH's recent projects in Napa Valley, Montecito, San Francisco, England, and Paris.
The disagreement was real, and it was about architecture
It would be inaccurate to describe this as universally welcomed. The commercial case drew broad support; the design did not.
The Los Gatos Chamber of Commerce backed the project firmly, pointing to regional draw, increased foot traffic, and spillover benefit for neighboring businesses. The Chamber's support letter cited an average RH restaurant generating more than $10 million annually — a meaningful sales tax figure for a town of this size.
The opposition focused on facade unification. A longtime resident and local history columnist argued the single-building treatment would erase the individuality of the existing storefronts. A Planning Commissioner who also serves on the Historic Preservation Committee pushed to protect the current structure and questioned what remains of Old Town's original character. Another longtime resident told Council the redesign simply didn't fit.
There was also a brief detour over whether to condition approval on the restaurant offering a plant-based menu item. That condition was dropped, and the project passed without menu restrictions.
Both positions are defensible. A vacant corner helps no one, and a well-executed anchor tenant genuinely lifts a downtown. But the preservation argument isn't sentimental noise either — the varied storefront rhythm is a real part of why Old Town reads the way it does, and once it's unified, it doesn't come back.
What this means for Los Gatos real estate
Let's be direct about this, because the temptation to overstate it is strong.
An RH gallery does not raise your home's value. No appraiser will adjust for it. No comp will reflect it. Anyone telling you a furniture showroom and restaurant added a percentage to Los Gatos values is selling you something.
What it does reflect is worth paying attention to. Retail tenants of this caliber underwrite locations carefully. A company that operates galleries in Montecito, Napa, and Paris choosing to expand its Los Gatos footprint — in a market where it already has fifteen years of local sales data — is a considered bet on the town's demographics and durability. That's a signal about who is here and who is expected to keep coming.
Downtown vitality matters over the long run, in aggregate. Walkability to a healthy commercial core is one of the reasons homes near downtown Los Gatos command what they do. Vacancy erodes that; absorption protects it. The effect is slow and diffuse, not something you'll see in next quarter's median.
For sellers near downtown, this is a legitimate talking point in a listing conversation — as part of a broader story about Old Town's trajectory, not as a standalone value claim.
For buyers, it's context. If you're weighing Los Gatos against comparable Peninsula or South Bay towns, sustained private investment in the commercial core is a reasonable data point about where the town is headed.
Timing
Council approval clears the entitlement, not the construction. Building permits, buildout, and restaurant licensing all follow, and RH projects of this scale typically take considerable time to open. No firm opening date has been publicly confirmed. The Town and the Chamber of Commerce are the best sources for current status.
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The Pulpan Brothers Group tracks what's actually happening in Los Gatos — the Town Council agendas, the commercial pipeline, and how any of it does or doesn't translate to what your home is worth. If you'd like a straight read on your property in this market, we're glad to have that conversation.
Details of the approval are drawn from public reporting on the October Town Council hearing and Planning Commission proceedings. Project scope and timing are subject to change; confirm current status with the Town of Los Gatos.
