We tried to warn tell you, the neighborhood is a changing. And money is flowing into the area (in more ways than one). From the San Francisco Business Times:

“While some condo buyers have been hesitant to invest in an area long overrun by drug peddlers and vagrants, the [SoMa Grand] has caught on among people willing to take a chance that the gritty corridor has the potential to become an exciting and eclectic enclave.”

“But even before the new wave of residents move in, the dollars have been pouring in. At 138 Sixth St., an organic restaurant and catering business, Split Pea Seduction and Jersey Tomatoes, has opened. At 121 Seventh St. is Custom Burger/Lounge, a gourmet burger spot and bar. Around the corner from the SoMa Grand, at 139 Eighth St., Chez Papa owner Jocelyn Bulow has created Bossa Nova, a Brazilian tapas spot and nightclub.

On Sixth Street, renovations are under way for two cafes, a Vietnamese restaurant, an optometrist and large produce/grocery market, according to Jenny McNulty, executive director of Urban Solutions, which works with small businesses in depressed areas. Most of the available retail spaces along Sixth Street are now spoken for.

“You don’t see it yet — a lot of these retail spaces are leased and in the midst of tenant improvements,” she said. “By March, you are going to see a really different landscape.”

And once again, in more ways than one:

“Among the new SoMa Grand owners are land use economists Claude and Nina Gruen of Gruen & Gruen Associates. Empty-nesters who are still cleaning out their 3,500-square-foot hilltop house in El Cerrito, the Gruens looked at some of San Francisco’s fanciest new buildings. They considered the Four Seasons, the Ritz-Carlton and the St. Regis.

But ultimately the Gruens were drawn to the dynamics of a changing district. The Gruens bought two penthouses on the 22nd floor for a 2,400-square-foot unit with a 350-square-foot deck. Depending on size and views, penthouses in the building are priced between $1,000 and $1,200 a square foot.

“We think it’s going to be a short time period before this area is transformed rather dramatically,” said Nina Gruen.

The Gruens compare the neighborhood to the 500 block of Howard Street, where they moved their business in 1974. At the time, it was desolate and suffering from the flight of industry and warehousing. Now it’s the heart of Foundry Square and the transbay district.

“That took 15 years — this will take five years or less,” said Nina Gruen. “I don’t have 15 years.”

And yes, that’s faster than some many (but definitely not all) dare might imagine.

31 thoughts on “We Tried To <strike>Warn</strike> Tell You, The Neighborhood Is A Changing”
  1. “Take a chance that the gritty cooridor becomes an exciting enclave”
    Three problems with that:
    1. You have to spend $1,000/sf to “take that chance” and there really isn’t a discount to be had for taking the risk.
    2. SF puts the homeless on a pedestal and seems ready to tolerate the general filth you see EVERY DAY downtown.
    3. Without a park in sight, who wants to live downtown unless you’re relegated to Walnut Creek or somewhere all week? It’s a ghost town on saturday and sunday.

  2. I’m just excited that The Millenium and Infinity are getting an infusion of tier 1 restaurants and shops in the next year. Makes working downtown and living downtown so much better.
    Yes, $1,000/sqft to get into this neighborhood seems like the new standard, but look what happened to other cities. NYC is now at $2,000+ for example.
    Inflation is ridiculous.

  3. I lived at 7th and Howard for 2.5 years and that whole time I heard and read about how the neighborhood was changing because of new businesses were going in. Well most of those new businesses on 6th Street are now gone. Bossa Nova replaced another trendy place Buzz 9 Cafe that went out of business last year. Not much did change in the time I was there and on subsequent visits it appears not much else has changed. I really do hope it improves because as I found out the area has to offer and contrary to common belief it’s safe. I’m still skeptical about changes though.

  4. The change has started at 5th street (e.g., Mint Plaza) and will continue its westward march. However, 6th Street will be difficult given how long it’s been that way. Also, the anti-gentrification forces will surely present challenges to change, especially to the numerous SRO hotels on that corridor that are viewed as providing affordable housing. I do believe change will happen, but it is faced with large economic, political, and social challenges.

  5. The biggest obstacle improvement is the huge, disproportionate concentration of social services in the area. They, and the dysfunctional street people they serve, aren’t going anywhere.

  6. Yeah, give it 10 years and the neighborhood *may* improve. It certainly won’t help if there’s a lot of turnover with these new businesses.
    For now I don’t see how anyone would spend up to $1000 per sqft for this location given it’s shaky and uncertain outlook…

  7. Uhhh, there was one sentence from that Biz Times article that wasn’t highlighted:
    “Sales have been modest thus far with about 90 units under contract.”
    That’s 33% sold in a building that is about done with lenders only getting more skittish.
    Kinda contradicts the rest of the PR (sorry, I mean news article) piece that things are red hot in the hood.

  8. What that neighborhood needs is some good ol’ fashioned Southern Sherriff-style policing! I’m visualizing dogs, clubs and shotguns…
    That’ll clean out the scum.

  9. The future is here. 15,000 condos either approved or on the boards does a neighborhood enhance.(at least in this location). That is, if you can wait 5-10 yrs.
    Just watch lower Van Ness (CSAA, etc), the Van Ness/Market intersection where parcels are being assembled, mid-Market,and upper market. And the ~10 fill-in sites in Octavia Blvd environs.
    In time, this stands to be a thrilling intersection of several interesting urban ‘hoods. Today it can be a depressing wasteland – unless you thrive on the contradiction that is SF — such as Saitowitz’s urbane 1234 Howard – just 3 doors down from a 24/7 glaring fluorescent-lit gas station with endless traffic, a car wash and a Burger King to boot.

  10. what this hood needs is for the city to stop dumping all its social services on it. There’s about 1 “social service” center on every single block in this area. the building at 10th & Howard (old DMV) is expanding its rehab services and another center is opening up on 7th between howard & folsom. Until this neighborhood stands up against these opening up all over place, this hood will suck. as a friend once said to me “if you put s*** out, flies will come”.

  11. 11th & Natoma,
    “what this hood needs is for the city to stop dumping all its social services on it.”
    There’s about exactly ZERO chance of this happening. Where do you think they’ll stick these services (which garner all sorts of perks for those dispensing the funds to buid and operate them) – next to Dianne Feinstein’s mansion??
    Anyone paying $1,000/sq ft here and gambling that this will become a “thrilling intersection of several interesting urban ‘hoods” (Invented – what’s your RE broker license number?) – reminds me of the old line:
    “When you get into a poker game, and after a few minutes you can’t figure out who is the sucker, well, it’s YOU!’

  12. I have been here 3+ years and then only change I have seen is the shift from needles in the tree wells to more human feces on the sidewalks. Hopefully the residents of the new Soma Grand can pull into their little garage and hop up the elevator only to watch the local residents continue to step over homeless people and shit.

  13. You have to wonder how much of SF’s economy is driven by its poverty industry and attendant social services. Too many people derive their livelihood from the squalor in the streets for things to change meaningfully for the better.

  14. I think that we’re paralyzed by our SF “let’s let everybody do their own thing” liberalism. Public spaces need a certain level of agreed upon public decorum and there is always going to be a fraction of the population that is unwilling or unable to meet that level. The unable you institutionalize. For the unwilling you send pinkertons with billy clubs to have a “frank exchange of views” on the value of public decorum.
    That statement will generate many horrified denunciations but it’s time to recognize that “Tut tutting” and looking the other way doesn’t work to create an acceptable public space.
    I’m reminded of a simpson’s episode where the town was rioting and looting due to a power outage. The simpson’s are sitting on the roof watching the carnage when we hear siren’s in the distance. Marge says, “Finally! Some repression!”
    And remind me, when did we vote to turn SF into the nation’s open air insane asylum?

  15. Although I’m liberal on most social issues, I think for the issue of the homeless, we really need a Giuliani style crackdown here in SF. I doubt that will ever happen, as the populous seems perpetually unwilling to ever elect a mayor who has the cajones to actually do something about the homeless crisis.

  16. zzzzzzz, you’re so right. If it wasn’t for the Google millionaires and the poverty pimps and race racketeers, I don’t think there would be an economy!!

  17. Unlike before, I think this area will change, but I think it will take an awful long time. I have neither the desire nor the patience to wait it out. However, I have noted the relentless crawl of nicer buildings “infringing” on this notorious corridor.
    The number of social services in SOMA does really make livability an issue for those in the area not seeking the services. The problem is that SF is trying to tackle problems the federal goverment should be dealing with and as a result, we attract an unsustainable population of special needs folks. In any real first world country, the resources would be available at a national level to care for people who can’t properly care for themselves. The homeless have to go somewhere, so I don’t see what a Giulliani wannabe would do to solve the root of the problem.

  18. Sure, a Giuliani wannabe wouldn’t solve the “root” of the problem. However, they would push the problem out of our city.

  19. I kind of feel sorry for the buyers who got in early on this building. They thought they were getting the “get in early” deal but will no doubt be the big losers in all of this.

  20. I’m not sure where you are quoting the $1,000/SF number from. I have been into the sales office and from the prices I have been quoted, the homes are more in the $800/SF range. When compared to other high-rises in the city it seems like this could have some upside in appreciation in future years, if the neighborhood improves its services.

  21. spencer,
    Don’t feel sorry for those “early adopters”. That’s what “jingle mail” is for. Step away from the trauma…..

  22. I think for $800 s/f you can buy in the treetops at the Infinity. For $1000 s/f, you could buy at the Brannan in South Beach. Both these areas are much improved than 6th/7th Street. Can’t imagine Soma Bland getting any better than these 2 buildings.

  23. The higher floor units facing east or southeast were going for $1000/sqft. Blocked views around $700-800/sqft. Average price at SomaBland around $800/sqft or higher. Still grossly overpriced for the area.
    Infinity treetops and lower tower units were a great deals for those that bought early. Those could have been had for $750-850/sqft. SomaBland don’t compare to Infinity or Brannan. Not even close….

  24. I agree that SoMa will only see more of the same without the residents of the area making noise. I do feel sorry for the mentally ill on the streets, but I don’t believe leaving them on the streets is a solution. I do not feel sorry at all for the majority of the homeless folks who are just plain selfish, in my opinion, because they often could sleep in a shelter if they would only follow the attendant rules. We all have to follow rules in society, and it is time San Francisco stopped giving folks a free pass if we truly are sick of it.
    There are three elections next year …. three opportunities to bounce some Supervisors that, for lack of a better word coming to mind, suck.

  25. I’m surprised in all these comments there’s no mention of the traffic issues in SOMA. It’s bad.
    All of the streets are like highways; who wants to walk on the sidewalks? There’s no sense of neighborhood, largely because it’s a nexus of cars racing to get somewhere else on multi-laned corridors. Biking through SOMA is a dangerous nightmare.
    In any event, I do hope this story is correct and they start working on the whole problem. Yes, the homeless and junkies here are also bad news (had one drop his drawers right in front of me the other day and lay a loaf, next to Brainwash – lovely!).

  26. I bought into 140 South Van Ness early on and it was scary, but affordable. When the building filled up, the streets became cleaner and less populated, at least from the building to Muni.
    140 is a great building and many buyers had a lot of options in updgrades and flooring, etc.. There was value, and I”m sure most buyers don’t regret their purchase.
    If Soma Grand were to adopt a similar approach, early buyers would have some real incentive, it would make sense. At these prices there is no value as they are unlikely to appreciate (most likely devalue) and too expensive to begin with. Way to much risk for a reasonable buyer.
    The increased foot traffic may have a similar effect as it did around 140, but most importantly, there would be a voice to petition for positive changes as the whole area becomes populated with property-tax paying homeowners.
    I’m hopefull that these buildings going up will have to adjust to more reasonable pricing. Everyone will benefit in the long run, and yes, the developers will still make money, less holding costs and lots of accounting acrobats for sure.

  27. As someone who has lived within two blocks of this development for the last 15 years, I think it deserves mention that this neighborhood has already changed a lot. When I moved into an apartment on Tehama between 5th and 6th back in 1992, there were smash-and-grabs every day, often multiple times a day. I have seen people being zipped up in body bags, shootings, and trannies giving tricks right on the street. But things started changing with the dot-com boom. I believed in the trend enough to purchase a loft on Minna between 6th and 7th in 1992, and felt (barely) safe enough to start a family.
    I would never had guessed 15 years ago that there would be a nearby park (Victoria M.) I can actually take kids to. Sure, I still feel out of place when we walk up Sixth to Tu Lan’s, but nobody bothers us. And I hate that people use the entry way to our building as their restroom, but even my friends in Pac Heights have to deal with that every once in a while.
    Why do I stay? I love being able to walk to work, and to be so close to Yerba Buena Gardens, MOMA, Metreon, Westfield, Union Square, the shops and cafes on Folsom Street, and the Sunday Farmers Market–just to name a few.
    So if things get better, great. But as long as they don’t get worse I’m cool.

  28. Satchel,
    The line is, “If you can’t spot the sucker in your first half hour at the table, then you are the sucker.”
    Please don’t butcher a great line. 🙂

  29. Actually the line is attributed to Warren Buffett, who once wrote in Berkshire Hathaway’s annual report “As they say in poker, ‘If you’ve been playing the game 30 minutes and you don’t know who the patsy is, you’re the patsy.'”

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