Huge Price Cut for Hillside Site Approved for 29 Luxury HomesJanuary 8, 2016
Fully-approved for the development of 29 luxury homes, each with a garage for two cars, the site and plans for the San Francisco Overlook project on the western slope of Mount Sutro have been on the market for $20 million, as we first reported early last year.
And this morning, the list price for the “Amazing Investment Opportunity to own a fully entitled parcel of land in a prime residential San Francisco Neighborhood!” was officially cut 25 percent, now asking $15 million for the land, approvals and plans as drafted by Levy Design Partners.
Comments from Plugged-In Readers
I thought approval was the hard part — if construction costs don’t pencil in, is there really another buyer who can make it work without redesigning everything?
Entitlement is the hard part.
Question is was the owner trying to stretch the bubble prices for RE even more? Was/is 20 million too much for this site (approval and all) to begin with? Or is this an actual pullback in value?
May not bode well for Parcel F or the City-owned Van Ness/Market St. sites.
From the rendering, “”luxury” is a stretch.
The land cost alone for each home was $690k per lot. After the price cut, it is still $510k per lot. How much can the homes sell for when built?
New construction with a nice view overlooking Golden Gate Park, (Marin Headlands on a clear day?)
I have not seen the plans so I don’t know about the average sizes etc, but my guess is, given 29 homes @2,500sf per home
$207 psf for the dirt and entitlements to date ($15mm/29 homes)
$75 psf for roads and utilities to build (sitework) No idea if this is sufficient, works out to $5.4mm total, seems like a lot for a 1.15 acres site with common drive.
$400psf new construction costs. Probably could spend less. Certainly for ‘production’ build quality number is not too low.
$681 all in cost psf for a 2500sf house with 2 car garage.
$800 psf selling price easy to underwrite with view etc. ($2mm sale price?) This mid-grade remodel recently got $950 per foot not far away.
$118 per foot profit * 2500 feet = @$300K profit per house.
I guess could wind up spending a lot on foundations given the steepness of the lot. I wonder if the sellers are shopping any pro-forma budgets? Doesn’t seem like an unreasonable price for the right builder/developer. The design looks a lot like the Summit townhouse developments going up off of Brotherhood Way on the South side of Park Merced.
I don’t think you lose money at 15mm. But maybe when Seadrill is trading at $2.82 down from $37 a year and a half ago, risk capital has better uses elsewhere…
Dear soccermom from 2 months ago. Why didn’t you buy more Seadrill then?
I had a longer comment that has been put in the moderation penalty box.
$15mm on dirt
$5mm on roads and site work
$29mm on Construction ($400psf * 2500sf * 29 houses)
$58mm Net sales ($800psf * 2500sf * 29 houses)
You clear $9mm or so.
I have not seen the floor plans. The Summit houses off Brotherhood are similar in size and lot layout it would appear.
Why are we building more single family homes when we could easily develop housing for hundreds on this site?! It’s 3 block from the N line.
A bit precariously perched on that hill- it would be difficult to supersize anything up there.
Not terribly difficult. 355 Buena Vista was built back in the 20s, and it’s a great example of a high density structure on a typical San Francisco steep hillside. We need more places like this.
That was an asylum when it was originally built was it not?
St. Joseph’s hospital.
It played the role of an asylum in the movie Vertigo.
[Editor’s Note: And was converted into condos in 1986 having been built as St. Joseph’s Hospital in 1926.]
Check again. 355 Buena Vista is build next to a steep hillside; not on a steep hillside.
Well it’s not steep NOW because they reshaped the land to put in roads and the foundation. The plan in discussion here will be doing the same terracing to put in the road. We have modern technology. A hillside is not that challenging of land to build on especially if there turns out to be bedrock under the soil as is the case with most of our hill in the city.
This is also right behind where the Kirkham project is going, and very near Sunset Towers. If we were thinking strategically, we would be adding density all over and putting new transit in to link up to the N
I agree. It’s the 21st Century, and we have here some of the most desirable real estate in the entire world.
Single family homes are a relic of the post-war baby-boom, when populations were small and land was abundant. The economic and demographic situation in the United States of the mid-to-late 20th century was an anomaly of human history that is not likely to be repeated within any of our lifetimes. We need to be planning and building to accommodate a future with more people and fewer resources.
All of the new residential construction in San Francisco and most of the new residential construction in the greater Bay Area should be multi-family, even if it’s on a steep slope.
San Francisco will still be one of the most desirable places to live in the entire world, even after the ‘tech bubble’ bursts, and the population will continue to grow, and the housing shortage will continue to be a drain on our economy and culture. This is not a time for half measures.
People who live here already don’t really want more dense housing. It’s not a crisis if you already live here.
well isn’t that the most selfish sociopathic point of view.
No, it’s just that people get comfortable with the world one way. They get upset when rent goes up or backyards and light and space shrink. Pretty normal reaction, I imagine.
Yeah, me comfy with Frisco pretty much as is. And nimbyism is helping increase current property values, so it’s good for that too. That’s why me love me some peskin! i can guarantee you that he’s going to be a huge wedge in future development projects. Heck, already he’s looking to bribe developers by getting them to agree to add rent controlled units in exchange for project approvals. This will all help self moderate the (first stages) of our slowing housing market anyways…so alls wells that starts wells…I guess.
And this is a big part of the problem. Residents in the Western half of The City need to come to terms that parts of their nabes need denser housing.
Is that what needs to happen? Or do larger numbers of smart people with ambition but fewer resources need to move to places like Vallejo and Richmond?
Or — cough cough — East Oakland?
all of the above, please, the sum of the ands is greater than the division of the ors. As soccermom has astutely pointed out before, the Vallejo and other suburbs afford a decent home within a tolerable commute of the SF CBD. Which has increased ridership on the ferries to where WETA added more service to Vallejo this year, will expand the Ferry Building complex (sans Sin Bads), and has proposed building a new Richmond ferry terminal. From a recent article: “Vallejo ferry route saw a 75 percent increase in ridership — from 1,624 daily trip to 2,843 — from May 2010 to May 2015.” The other ferry routes are also up, just not so much by percentage.
FWIW, more people commute from Solano+Napa+Sonoma counties to SF for work than from Santa Clara county. Been that way since the 1990s dotcom SF RE price doubling diaspora.
The scattered contentious infill projects in the western SF nabes increase the housing unit density ~0.5% per year longterm (not counting the Park Merced redo). That may never be enough to justify a BART station on 19th Ave or a ferry terminal at Sloat, but then the western suburbanites of SF are not nearly as ambitious as those to the east.
Reality is the Western half of city is largely SFHs. Twin Peaks, Mt. Davidson, St. Francis Woods, Forest Hill, Lakeshore and the Sunset to name some.
Nothing is forever, but this part of the city will likely never be converted from SFH neighborhoods. Short a disaster like and earthquake which forces massive rebuilding of the area. Some of the areas are gems of architecture – like Westwood Park (arts and craft homes) and it would be a huge loss to replace them with sterile 4/5 story multi-family boxes.
For western SF (not well defined), the majority of housing units are in MDU, though the majority of the residential buildings are SFH. This is true for both the Inner and Outer Richmond, and for both the Inner and Outer Sunset, and for Lakeshore, and Outer Mission, and Excelsior, and Presidio Hghts, Crocker Amazon, Diamond Hgts/Glen Park, Seacliff, Twin Peaks, Visitation Valley….
Just about the only areas where SFH account for a majority of the housing units are Parkside, Oceanside, and West of Twin Peaks; which together house less than 10% of the population of SF.
BTW, I’m using the neighborhoods as defined by SFPlanning in “San Francisco Socio-Economic Profiles.”
It doesn’t take many ~40 unit buildings replacing gas stations, parking lots, and motels to double the current growth rate of housing units in the tranquil NIMBY sandhills of west-frisco. Used to build them out there like that in the 1920s, when SF had ~30% less residents than now.
Well, the Parkmerced expansion is coming online. Let’s see how that sells/rents out. It’s not that the Westerners need to “come to terms” as much as there really hasn’t been that much demand for the West. I don’t see that much NIMBYism to the projects that I’ve heard about (all on Socketsite), the one at the terminus of L-Taraval, the one replacing a gas station. The main thing, people aren’t building. So I presume that the demand isn’t there. 800 Summit isn’t selling that fast. Why should the West “come to terms” if the developers themselves can’t make it pencil out?
Isn’t that nice that you got yours, soccermom? Now you’re happy to send young people to go and screw over the black communities in Richmond. Happy for you.
jenofla, Parkmerced is a 15-20 year project, by the time it sells/rents out we could go through two more housing cycles. And they went through years of controversy and lawsuits before they broke ground. Summit is SFH with 2-car garages 2 minutes from 280 in an otherwise unusually isolated location with a walkability score of -20. Most of the market for those are people that drive alone to work in San Mateo county. More car-aholic suburbia being built in San Francisco instead of Millbrae or San Carlos. A similar infill development along 280 in Potrero/Dogpatch would have at least 4 times the unit density and less than 1:1 parking.
Notice that your examples are mostly geographic corner cases. By contrast, how many years does it take to build a CVS on 19th Ave or convert an old movie theater into condos in the Richmond? How welcome would the neighbors be if the amount of housing units of the Summit were proposed for 85-foot tall buildings in West Portal? Or as 105-foot tall buildings on Irving at 21st ave, where it is already zoned for that height? Who knows maybe if Katy Tang can get better MUNI service on the N-Judah we will find out, though her ‘Sunset District Blueprint’ doesn’t call for increased density to generate additional transit impact fees to pay for it, unlike what is expected/proposed in the eastern side of SF.
Part of penciling out a project in SF is penciling in the opposition, whether it be the lawsuits the Warriors must have expected or the deal the Giants cut with Kim to boost their BMR share. FWIW, from a 2014 KQED story: http://ww2.kqed.org/news/2014/11/01/San-Francisco-housing-crises-affordable-solutions
“For nearly four decades, residents of the western half of San Francisco have succeeded in blocking any local zoning changes, saying that adding higher-density and affordable housing options would harm the neighborhoods’ residential character. But as rental prices skyrocket, the city could add thousands of new apartments without increasing parking problems by carefully tweaking housing regulations in the west — an area largely untouched by the recent construction boom.
The last time a city official proposed denser residential development along busy transit corridors, the idea was nixed. Amit Ghosh, then the city’s chief planner, drafted a citywide plan for the 2004 Housing Element that would have increased density and removed parking along many major commercial strips well served by public transit. The backlash was overwhelming. Neighborhood groups threatened legal action, and then-mayoral candidate Gavin Newsom promised to replace the leadership at the Planning Department and rewrite the whole plan.”
That the Summit project is not sold out surprises me. I ride my bike around LM each weekend and the sign for open houses is still out there. Its been about a year. Have no idea why these are selling slowly. Homes in Lakeshore and across from Stonestown (between 19th & JS) sell quickly and have seen large price increases in recent years.
They don’t need it – others who want to move in need it. This is OPs point.
@ Jake: I guess I’m basing my opinions on anecdote. 90% of my SF or SF-bound friends react in disgust whenever i mention living in the Westside. They move to the Peninsula, Oakland, Potrero, Bernal, and Excelsior, even when there are cheaper options out West.
The western neighborhoods are just too foggy, too boring, too Asian, not hip, just not exciting enough. If people do move here, it’s because they can get the space with yard and garage, not so they can live in a condo in the fog.
If these small corner developments go well, I suspect then there will be more development. But overshooting demand can lead to stagnation or a loss for the developers.
Personally, I would love more density along the MUNI lines since it means more population to create a more diverse number of businesses and activities. But given the indifference I’ve encountered from most people regarding living in the Westside unless it’s exactly the SFH experience you decry, I haven’t been holding my breath.
This entire discussion thread is (mis-)conflating two separate issues. Yes, there are areas even in the western half of the City, such as along Geary (or even the N-Judah line), where density can be increased. All of Geary from Divisadero to 25th Ave should be built up to 5 to 7 stories – and that provides an amazing amount of densification opportunities. But that’s completely different from building eyesore Russian Hill-style buildings on the highly visible slopes of a hill, adjacent to a large and surprisingly well preserved open space.
Not to mention that I think a lot of the City felt that “the deal” was to allow increased heights and densities in SoMa, and the redevelopment of Mission Bay, Pier 70 are and Bayshore, in exchange for decreasing densification pressures on the western edge of the City (where, and obviously this is chicken-and-egg, the infrastructure is not currently able to support much more density).
@ Sjeff: I am not sure how much traction anyone will get with the ‘don’t-mess-up-that-hillside-I-like-to-look-at’ argument. I can empathize with dissatisfaction when a next door neighbor blocks out tons of light, or when a new project doesn’t provide enough parking and there is a ‘tragedy of the commons’ effect on street parking, but private land on a hillside you drive by or see out your window?
Come on. It’s a city that’s trying to figure out how to grow…
i dont see a lot of good places to add density except geary. Geary from Divisadero to Park Presidio is a key location, and I would call it Central SF and not west (although i know its defined that way). I also agree with other posters that there is not a huge demand to live west of park presidio in richmond or 19th in sunset, but the area on geary from Divis to park presidio is pretty desirable. Honestly , there are less than 30 foggy days per year, and less than 15 per year over the past 4 yrs. but we also need better transport. My wife takes 40 minutes on cal 1 BX from arguello to market. thats just terrible for 3.5 miles. she doesnt take geary because the buses are already full by arguello , plus its much dirtier and she got bunched in the face by a mentally ill person 2 yrs ago. I would stronly support 6-7 story building with ground floor retail from Divis to park presidio
“not a huge demand to live west of park presidio in richmond or 19th in sunset”
What are you basing this on? Prices in those areas are higher than 99.9% of the US. Seems like all sorts of demand – slightly less than the Mission, for example, sure. But still crazy high, compared not only to the rest of the country but also to even most of the rest of the Bay Area. Anything that we can do to upzone those areas will have tremendous benefits.
not a huge deamnd vs. east side of the city. there is a lot of growth still to be had in SOMA. Western SOMA should be upzoned to 12-15 stories completely before anywhere west of park presidio. The geary area between divis and park presidio should be upzoned before the westernmost parts. the majoriuty of people living in or moving to SF would not choose the west side. that was my point
I would like to see the north side of Fulton rezoned the length of the Park from Stanyan to the Great Highway for an uninterrupted streetwall of midrises (12-20 floors) of residential apartments and condos and some hotels with some of the nicer, current properties interspersed.
About 20+or so years ago, a Planning official (Macris?) floated a trial balloon for just such a thing which obviously went nowhere.
I agree that Fulton is also a good place, but you will get a lot more pushback IMHO as the “more shade on green space” people will come out in throngs for cutting out 30min a day of Sun on the 10 ft of northernmost edge of GGP. In the same vein, the same could be done for Lincoln.
Most people who live near Fulton, who pay property taxes, and enjoy being close to GG Park would not want to see massive upzoning, and a wealth of new cars added to the neighborhood. What’s more, renters who live in r/c units near the park don’t want to see massive new developments that increase the value of the land under the buildings in which they live.
This is the political magic of NIMBYism, it is a culturally-unifying melting pot of static inertia. So, don’t hold your breath.
SM, agree with you. Thats why I think Geary is the lowest hanging fruit.
moto, I expect that if we were to upzone say, all of SF to 80′ or something, we’d see similar levels of development on the west side as on the east – the west side units would simply cost less (because the land costs less, etc). So yes, there’s more demand on the east side, but demand is so high that we’d likely see a huge rash of development on the west side if it were ever permitted. I’ve seen nothing to indicate that there’s lack of demand to upzone there, just lack of political will.
It’s not a crisis if you already *own* here. ftfy.
You got yours! Pull up the drawbridge, sorry suckers! Congratulations.
I hope to hell you’re not signaling surrender in the fight against World human overpopulation.
@Jake Yes, my point was that – the majority of West of TP is SFH and that won’t change in like forever. Building up Taraval a bit or Ocean Avenue is not relevant.
And is there any real reason to transform Twin Peaks, Mt. Davidson. Westwood, Lakeshore or Forest Hill? These are gems!!
Sunset? Maybe not so. I’ve had more than one visitor tell me as we drove Ocean beach – what an ugly stretch of California ocean-front property. I agree, this part of SF is a blight. But it can’t be changed anymore than St. Francis Woods can be converted to multi-family dwellings..
We don’t have to convert all of the parcels to higher-density residential to fit another 100k residents over the hill. A 1000 parcels at 40 units (6-8 story) each plus the routine little infills will do. Spread it out over 20 years and you will hardly notice it.
Yeah, but with Central SOMA built out to 8 stories, TI, PM. HP and the stretch from MB to HP, won’t that accommodate the 100K? Without significantly up-zoning elsewhere? Thought that was the plan.
100k here, 100k there, and soon your talking real density. Might turn this hilly seaside town into a city whose mere name conjures dreams worldwide that draw the adventurous, the talented, and the greedy. Nah, could never happen in Jiu Jin Shan, well not again, or ….
I dream of the day where a short walk anywhere in the city leads you to small pockets of density with cafes, etc. How about every fourth corner in the Sunset is zoned for 85′ on all four corners? Hardly noticeable, yet would yield space for tens or hundreds of thousands of people – and provide first floor services for the rest.
Great, just get a political plan together to make it happen. Your problem is that people don’t want 85′ towers on every fourth corner.
Why not wish for a pony stable every 10 blocks? And a pony for everyone?
And that’s my question – why? Many areas of the Sunset and Richmond already have this. Many of the people that I know in the Richmond and Sunset don’t care about this (actually, all of the people I know, which is dozens). I’m curious why it’s taken as scripture that no one in the Richmond or Sunset would ever allow it – it’s never even really been tried.
I encourage you to purchase a corner property and work on getting it upzoned to 85′ with the intention of building apartments.
It will be the best way to test your hypothesis that people won’t really care about the change.
I have no interest in seeing spot rezoning.
“… surrender in the fight against World human overpopulation”
Please. This is the epitome of self-righteous San Francisco nimbyism. The belief that, by limiting local urban housing development, there is some effect on world human overpopulation, is as ridiculous as it is selfish.
There is no evidence anywhere in human history that limiting the construction of housing prevents growth in human population. Usually it just causes the excess population to either move somewhere else (like Vallejo), or it causes them to live in squalid shanty towns such as those in the suburbs of Mumbai, Cape Town, Rio, or Dhaka.
So no, you are not fighting the good fight against a great human evil. You are just pushing those inevitable human problems away from yourself so that you don’t have to personally witness them.
Large modern urban cities such as San Francisco are the **best** places to house people because they already have much of the major infrastructure necessary to accommodate lots of people (and yes, despite the problems with Muni, San Francisco does have excellent infrastructure in the greater context of global human lifestyle).
If you are truly concerned about world human overpopulation, rather than just annoyed by the population in your immediate vicinity, probably the best thing for you to do is go distribute contraception in some of the more poor nations in Africa.
And you typify the hubris of racist “exceptionalism.”
Why, this is no concern of ours, we’re not part of the problem”
Distribute contraception to Africans? Really! So that Americans can continue with their ruinous practices of consuming and creating waste at a rate several times that of an average Third World person.
No greater example than of Europeans pushing Native Americans, who lived harmoniously with the land, in order to create the most naturally unbalanced society the World has ever witnessed which continues today. You truly believe that we can just continue to indulge our excesses without having any responsibility for the consequences?
Oh, let others worry about it, huh?
If you think an SFH development anomalous, try out 2-car garages per unit.
The 460-unit Kirkham Heights project proposed for just below this site touts itself as a low-ratio transit-smart development. Quite a contrast.
N Judah was awfully slow and crush loaded when I lived out that way 15 years ago. Can’t imagine it is better now
Zig has a point. All this chatter about westside outer avenues needing to ‘get used to higher density’ ignores the fact that the infrastructure, everything from muni to trash, is ancient and built for tribal population. You can’t have a world class city by simply adding more people. You need infrastructure, open space, decent public transit etc.
Not to mention that it’s one thing to talk about increasing density along a corridor, such as Geary (or even the N-Judah line), and another to talk about slapping high-rise multifamily buildings on the slopes of Mt. Sutro. All of Geary from Divisadero to 25th Ave should be built up to 5 to 7 stories – and that provides an amazing amount of densification opportunities. But that’s completely different from building eyesore Russian Hill-style buildings on the highly visible slopes of a hill, adjacent to a large and surprisingly well preserved open space.
Because the N line can barely manage its passenger load as it is, and because not every new construction needs to be a glass and steel highrise?
they will likely sell for $1.5M each on average I would presume. This is a reflection of the looming recession coming in 2018 and the fact that if they broke ground on this in the next months, they would be coming to market with 2018 staring you right in the face…meaning buyers would be assured that their purchases would soon be worth less than what they paid for them. Its time to be judicious, we are way past
the half way point in this cycle.
If there is going to be a recession, which I expect, it will likely be before 2018. The recession cycle is like 6/7 years so we are due.
Maybe that is why the owner lowered the price. Time might not be right to build. It may be a case of needing to let the property stand as is for 2 years or whatever and the owner did not want to do that.
This project should pencil out with a nice profit for a capable developer – see soccermom above. Opportunities for building new SFH in SF are rare; if you can build 29 homes in one fell swoop, the economics of scale will benefit the builder. Since these homes are going to have dramatic views and a good location, a $2M ask is absolutely reasonable.
Great, let’s make Mount Sutro look just like those hills up against The far southern edge of SF and or Daly City. Unsightly skeins of buildings thrown across the hillside.
sucks to building housing for working people. They should never have stopped farming cabbage out that way
The Bay Area One plan, I believe it is so called, is to increase density throughout the BA. Not just SF. Look at the El Camino stretch from SSF to Burlingame. I’d much rather have higher density built there (its basically 2 story commercial now) than pave over Mt. Sutro. SF realistically can’t absorb much more population. Upper Peninsula can. I’d say Marin/Sonoma too but the monied folk won’t allow that.
This does not have to all fall on SF.
Why in Hell’s name could you even countenance extending urban sprawl into the idyllic gem that is the bucolic glory of Marin/Sonoma in lieu of increased density of the urbane wonder of SF? Pure nonsense!
@Orland–I have been trying to figure-out why its a *given* that suburban communities must accept greater density to house larger numbers of workers employed in other cities.
There are benefits to growth but, as the comment threads here attest, there are a lot of (mostly externalized) costs. What would be the costs to San Francisco and the Bay Area if the growth were allowed to happen somewhere else? How much growth is the right amount? Are businesses and developers providing enough to the Bay Area community in exchange for the benefits they derive from locating their businesses here? How many of the new jobs are employing long-time San Franciscans as opposed to people who came here for the job?
As UCSF departs this area, note their large buildings to the left and below this development, will those buildings be torn down for open space? Hope, hope, but that ain’t happening.
What is the plan? Convert the space to housing, give it over to UCSF support offices? Or a combination of that?
Will UCSF move its major activities to Mission Bay? Or is it just an expansion? I guess UCSF may keep both campuses and expand instead of move. Demand for hospitals is strong and the city can definitely support more hospitals even though student population stay the same.
they are just expanding. they are not moving from parnassus
There are no plans to close the Parnassus campus and actually some renovation/infill projects in the works.
@Dixon Hill: If you like China or the former Soviet Union, essentially a “passport” and a job and a place to live are required before you can move to a different city. This is America. You know, freedom. This is San Francisco, you know, “Open up your Golden Gate, you’ll let nobody wait outside your door.” People can and will move here. I for one am extremely glad.
@Jim–I re-read my original comment and didn’t see anything about liking China or the former Soviet Union. I’m not advocating blocking anyone from coming to the Bay Area. I’m just wondering how the costs and benefits of growth balance out favorably. You didn’t respond to my question about whether the Bay Area is getting enough in return from companies who want to set-up shop here and the developers who building new office and residential buildings. The conversations here generally *assume* that growth is always good, but I’m not sure that’s true.
If the growth went to Los Angeles, Seattle, or Denver, would the average employed person in the Bay Area be worse off economically? It’s not clear to me that they would be. Increased congestion, strain on infrastructure, and displacement of lower-paid workers are generally considered to be harmful to the quality of life.
The key phrase: “the average employed person”. Growth helps the average unemployed person, which seem like people that we should try and help.
Sierrajeff is right about the eyesores on Chestnut and Green on Russian Hill, and for that matter, the Fontana on Aquatic Park, but this project isn’t going to block anyone’s view or be an embarrassment fifty years from now.
UPDATE: The listing for the Overlook project site has been withdrawn from the MLS without a reported sale.
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