101 Hyde Street Circa 2015

Rather than including 36 below market rate (BMR) units within the walls of its 304-unit development to rise at 1066 Market Street, or paying a $17.7 million in lieu of fee, Shorenstein Properties is now seeking permission to buy and dedicate the former Post Office property at 101 Hyde Street, which could support the development of up to 85 units, to the Mayor’s Office of Housing for the development of a 100 percent affordable building.

But at present, San Francisco’s Planning Code doesn’t allow for a land dedication in order to meet the City’s inclusionary housing requirements for downtown developments, an option that does exist for other areas of the city, such as in the Mission.

As such, Shorenstein is now seeking a Code amendment and exception in order to meet the inclusionary housing requirement for 1066 Market by dedicating the 101 Hyde Street parcel, which has been valued at $12.5 million, and donating $6.5 million to a non-profit organization, “for the promotion of the development of an affordable housing project sponsored by a non-profit affordable housing developer that will include between seventy-five and one hundred units of affordable housing located in the vicinity of the Project (between Market Street and Larkin Street and between McAllister Street and Turk Street).”

According to the City’s Planning Department, once the land was transfered, an additional $21.5 million would need to be secured before the development of the 101 Hyde Street site could be initiated. And the Mayor’s Office of Housing and Community Development has estimated that the development of 101 Hyde Street as an affordable project would take between 8 and 10 years to complete.

But if the project should qualify for $17.5 million in funding from the State’s Veterans Housing and Homelessness Prevention and Affordable Housing and Sustainable Communities Programs, the funding gap could be as low as $4 million, in which case the project could be developed in as few as 4 years.

San Francisco’s Planning Commission is slated to weigh Shorenstein’s proposal next week.

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Comments from “Plugged-In” Readers

  1. Posted by MukDutch

    What’s the point of having a planning code if developers can amend it at will. Shorenstein should be held to current code. The city’s not seeking to amend projects previously approved to include the newly passed BMR requirements, if that were the case outrage would ensue and all development stall.

    Furthermore the Tenderloin needs to diversify the community, adding market rate properties along with additional affordable housing, and condos for sale. If the city is granted the site it will sit vacant for years and years and attribute more blight to an already concerning area. I assume the approved eight story project for this site is no more.

    • Posted by 111111

      Preach! Another great example is the project at 16th and Mission. It’s allowed by planning code, so let’s build it already! Stick to the code and do not allow spot zoning.

    • Posted by Chris

      The planning code allows developers to build off-site affordable units or pay an in-lieu fee instead of building onsite affordable units. So, I do not understand your point?

      • Posted by Chris

        Basically, this is just a variation of the offsite housing. You are talking about a minor variation of what is permitted. So, fine, Shorestein could just pay a cash fee instead of dedicating the land, which would be LESS going to affordable housing and ultimately fewer units being built.

  2. Posted by DrPants

    Another developer trying to buy his way out of including BMRs in his spotlight development. Looks like they were doing the minimal requirement as well.

    • Posted by Chris

      The code allows affordable units to be built off-site or for an in-lieu fee. If you don’t like the law, get the Board of Supervisors to amend it.

      • Posted by DrPants

        Yes, I understand the rules. It just kinda urks me that it seems like they are shelving the low-income or lessor earning people else where and keeping all the luxury/rich people from seeing them.

  3. Posted by Dave

    This is partly why Prop C won so overwhelmingly. Developers have run rough shod over the City at the acquiescence of the Mayor and PTB.

    Hopefully those days are coming to an end.

    • Posted by formerly%whatever

      Acquiescence? That is the Kool Aid served by Jane Kim, Peskin, Avalos, et al. The reality is that the Building Dept imposes new and always more expensive mandates to new construction, and Planning takes way longer than it should to make determinations. Projects here don’t get approved in 3 months, but rather 3 years. How could developers be running rough shod over the powers that be?

    • Posted by Chris

      Again, this is allowed under the law, AND under Proposition C.

      If you don’t understand how the law works, do not complain about it.

      • Posted by Chris

        So, if the developer paid cash, which wood just go to the city fund and sit, it would be better? Instead you have a perfect site already to be built on–it will result in more affordable housing units and be a better deal.

    • Posted by Oh Dear

      Developers in SF run rough shod over the City? Examples, please.

    • Posted by Elitist Pig

      I thought it was motivated by BMR handouts via a higher threshold and a general lack of understanding. Did Peskin & Co. tell voters that this would help existing home owners who want their property values to continue rising while dramatically slowing new development, or was that implied?

  4. Posted by soccermom

    Isn’t getting 18.5mm for BMR housing of up to 85 BMR units better than 36? Happy to have pols negotiate for more housing.

  5. Posted by Louis

    Who is the unnamed not for profit getting the 6 mil and how will their deployment of that gift capital be governed?

  6. Posted by Out of Town

    The donation to a non-profit sounds very fishy – why not put that money down to get the BMR units build? If the code requires BMR units included, why would the developer do all these other side deals instead of just building them?

  7. Posted by gentrified is a dirty word for clean

    Can we just go back to the days when the Mafia controlled the building industry? That system was less corrupt.

  8. Posted by Zugamenzio Farnsworth

    From what I can pencil together…original developer got a building here fully designed, fully permitted, and then the “Post Office” lingered for months (homeless advocates grandstanding, “Where will they get their mail?” etc) at which point the developer seemingly backed off and is trying (i believe) to “sell” the fully permitted lot off and it sounds like Shorenstein’s saying I may buy it for BMR’s, hold the permits please, let the city figure it out, someday, sometime. In other words, “!Vive el urban blight!”

  9. Posted by DM

    BMR is to condos what Section 8 is to rentals. There’s a stigma (racial, socioeconomic, class, etc.) that gums-up developer/builders’ and planners’ intentions. Keep in mind the law of unintended consequences.

    • Posted by Amewsed

      True. It is a kiss of death for being upwardly mobile. My cousin is working with her real estate agent (after four failed lotteries) to get one of the BMR two bedroom places in the city — it is just a cheap entry into SF home ownership, without any real investment grade return on value. She works in the city. Next options are South San Francisco and Pacifica.

  10. Posted by Zugamenzio Farnsworth

    i understand that the site’s a good candidate for BMR’s, [based on] the fully-permitted/planned (i’ve seen the blueprints online already) building that almost went up. [Would] be nice if Shorenstein just built that for the BMR’s, otherwise the parcel will just sit in its current unsavory fashion until a pig singing the blues flies through a frozen-over heck: honestly.

  11. Posted by RJ

    This needs to be developed now, it is a total drug den right now.

  12. Posted by Zugamenzio Farnsworth

    Agreed. If Shorenstein wants to play big-shot “he” could build something here: maybe a BMR piggy-bank of sorts to use on various projects, otherwise, whatever’s donated will just get siphoned off by whomever. 4-8 years? Jesus Wept.

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