While the sale of the City’s five-story building at 30 Van Ness Avenue, a building which sits upon a parcel which is zoned for development up to 400 feet in height, was authorized for sale by San Francisco’s Board of Supervisors with a price of “no less than $87 million,” the City returned to the Board with a deal for $80 million, as we first reported last month.
And with Supervisors Avalos, Breed, Campos, Kim, Mar, Yee and Peskin having voted against the Mayor’s resolution to ratify the sale of 30 Van Ness to Related California yesterday, the $80 million deal, which was structured with a leaseback to the City until late 2018, was formally rejected.
The outstanding debt on the building is now around $28,900,000. And after paying $400,000 in broker commissions and $40,000 in marketing costs, the City would have received roughly $50,600,000 in net proceeds from the sale, not including Related’s agreement to pay the City’s $2 million transfer tax, to help finance the City’s proposed development of a new 17-story building at 1500 Mission Street, on the eastern half of the Goodwill site at the intersection of Mission and South Van Ness Avenue. The proceeds would have also been used to pay Related $14.9 million in rent and operating costs for 30 Van Ness through 2018.
Related had also agreed to offer 15 percent of the development at below market rates, versus 12 percent as currently required by law, with an option for the City to increase the percentage of affordable units to 33 percent, but the City would have had to pay all of Related’s development costs for the optional units while Related would have retained the rents.