Approved by voters in 1986, Proposition M limits the amount of new office space that can be built in San Francisco and provides San Francisco’s Planning Commission with the sole authority to allocate the pool of entitlements.

As of the end of March, the pool of allocable space for new office developments in the city which measure over 50,000 square feet apiece (i.e., Large Cap projects) totaled roughly 2.9 million square feet with an additional 875,000 square feet to be added to the pool in October.

At the same time, proposals for roughly 6.6 million square feet of Large Cap development are working their way through Planning and competing for an allocation. And with that in mind, San Francisco’s Planning Commission has been seeking Planning’s guidance on how to proceed.

From San Francisco’s Director of Planning, John Rahaim:

There has been substantial interest in the topic of “public benefit” with respect to how the Commission might consider weighing proposed projects. [San Francisco’s Planning Code] does not use the term “public benefit.” Instead, the Code directs the Commission to act on office projects according to the following, excerpted from the code:

“(3) In determining which office developments best promote the public welfare, convenience and necessity, the Board of Supervisors, Board of Appeals and Planning Commission shall consider:

(A) Apportionment of office space over the course of the approval period in order to maintain a balance between economic growth, on the one hand, and housing, transportation and public services, on the other
(B) The contribution of the office development to, and its effects on, the objectives and policies of the General Plan;
(C) The quality of the design of the proposed office development;

(D) The suitability of the proposed office development for its location, and any effects of the proposed office development specific to that location;
(E) The anticipated uses of the proposed office development, in light of employment opportunities to be provided, needs of existing businesses, and the available supply of space suitable for such anticipated uses;
(F) The extent to which the proposed development will be owned or occupied by a single entity;
(G) The use, if any, of TDR by the project sponsor.

Payments, other than those provided for under applicable ordinances, which may be made to a transit or housing fund of the City, shall not be considered.” (Emphasis added)

Since Prop M was adopted, there have been two periods in which the demand for allocations exceeded the available supply:

“One was in the late 1980s to early 1990s, and the second was in 2001. The Commission considered competing projects at public hearings, where each sponsor presented their project knowing that not all could be approved. This procedure lead to the informal designation of the process as a “Beauty Contest” because projects were presented in competition to each other, and much of the discussion was based on the design of the projects.

In both time periods, the Commission adopted a resolution that references a Directors Memo; the Director outlined the recommended approach to approving office projects. That memo uses the 7 criteria outlined [above] as the basis of the recommendation. To implement these criteria, the Director recommended a list of 10 criteria, each of which would be judged as “excellent”, “good’, “fair” or “poor”. The criteria changed in the two time periods, but the system was basically the same.

While the Director’s memo suggests the four-tiered ranking noted above, it does not suggest a way of comparing one criterion to another, nor does it rank the importance of the criteria. Further, to our knowledge, there was no formal process by which projects publicly competed with each other in such a way as to offer competing bids for public amenities, other than the aforementioned presentations at public hearings. Obviously, if such a process occurred in private, there is no public record of those discussions.”

In terms of how to proceed, Planning is recommending that the Commission skip a beauty contest and allocate the first traunch of the pool to Central SoMa projects, in a phased manner and “in the order that the projects are otherwise ready to be approved,” backed by the following reasoning:

a. Central SOMA projects should be considered before other proposed projects, because they have been in the department’s queue for the longest time, and, are providing a type of office space not available in other parts of the city. Further…apart from the project at 400 Second Street, no other Central SOMA projects have Prop K shadow impacts.

b. All Central SOMA projects have been designed in parallel to the plan itself, and staff worked with project sponsors of the Key Sites for several years to help ensure that their projects fulfill the goals of the Plan. The Central SOMA plan establishes the most robust exactions of any area plan in the city, due to the substantial up-zoning, infrastructure and design standards for the area, and the impacts to be addressed. These provisions were established in the plan and Planning Code, and, are therefore consistent with the provisions of Sec. 325 as noted above. This menu of exactions and requirements is well in excess of anything contemplated in 1986 when Proposition M was approved. Further, each site is different in size and scale and each is offering a package of benefits — all within the Central SOMA menu — that suits that site based on the unique conditions of the site, and the impacts on the community.

c. Staff does not believe that the Commission, or any approving entity, should base their decisions on a “pay to play” model, and should particularly not encourage an auction-type approach to these decisions, such that the highest bidder wins. We would submit that this is an inappropriate way of making land use decisions, both legally and with respect to appropriate planning.

d. Some have suggested that, even within the menu of exactions and requirements of the Central SOMA plan, the Commission should create a weighted scale to compare one project to another. For example, one proposed weighted scale would suggest that the replacement of an existing private athletic facility should be weighted greater than the replacement of an existing PDR space with 250 jobs. Staff believes that such a comparison is not possible, given the variety and size of improvements proposed. The question is NOT whether projects are providing significant benefits, but whether the staff and Commission should be in a position of COMPARING one type of benefit against the other.

e. The Commission has approved many large cap projects in the past several years. Each was judged on its own merits, on the basis of code provisions, design, and other criteria established in the Planning Code. The Commission has not weighted one project against another.

And more specifically, Planning is recommending that the proposed developments at 88 Bluxome (a.k.a. the San Francisco Tennis Club site), 598 Brannan and 610-698 Brannan (a.k.a. the San Francisco Flower Mart site) receive the first, partial, allocations from the existing pool, allocations which could be approved by Planning over the next three months and then increased over time.

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Comments from “Plugged-In” Readers

  1. Posted by sparky-b

    So they are going to approve them based on, ” in a phased manner and “in the order that the projects are otherwise ready to be approved,”” while they are not to “base their decisions on a “pay to play” model”. As if the projects that are at the front of the line didn’t pay their way to the front now. Line up your expeditors! Get your approvals first. Don’t pay the city directly for it pay your money in murky back channels.

    Besides any of that, why bother with a whole long list of how it should be done and then end with a recommendation of projects that total over 4mm in commercial space. Taking all the available, and the new October and most of the October 2020.

    • Posted by SocketSite

      As a point of clarification, while the three recommended priority projects total around 3.8 million square feet of office space, their initial, piecemeal, allocations would roughly match the 2.6 million square feet of available space in the existing pool, with 88 Bluxome receiving an initial allocation of 470,000 square feet (with another 363,000 square feet on the boards), 598 Brannan receiving an initial allocation of roughly 700,000 square (with another 222,000 square feet on the boards) and 610-698 Brannan receiving an initial allocation of around 1.4 million square feet with plans for a total of 2,030,000 square feet having been drawn.

      • Posted by sparky-b

        So how do the add-on’s work? I would imagine they need the spaces finalized before the construction starts, so they will know if they will be requesting it or not. Say Flowermart needs the other 600k but it isn’t available for another year; does the project have to wait until the next year and see if they get the Prop. M allotment. What if they don’t get it that year? or are they guaranteed to get it the following year?

        • Posted by SocketSite

          The specific allocations as recommended would allow construction of the three projects to be phased. We can’t speak to the mechanics, or guarantees, for the additional allocations needed to complete the developments as proposed.

      • Posted by Orland

        There was a move afoot to augment the available space by the amount of square footage of office space which had been converted to other uses (such as the proposed transformation of the Hearst Building to a hotel). Does the current amount take that into consideration, or is it subject to such possible expansion, or has that thinking been abandoned?

  2. Posted by The Milkshake of Despair

    The Prop M targets are fixed and not referenced to any other index, right? It would be better if commercial allocations were tied directly to the growth rate of housing creation. In periods if high housing growth, allow more office space. When housing stagnates, reduce the size of the pool. Without tying the two together there’s a risk of making the commute to SF worse.

  3. Posted by Peter

    Sustainability/ CO2 impact of the competing projects needs to be added as a criteria.
    For example give the project a green score based on:
    – Is the project reasonably transit-accessible for the traffic it will generate
    – What is the volume of demolition/ construction waste produced on site?
    – Is the project LEED certified ?
    – Are the materials recycled/ recyclable ?
    – etc.

    • Posted by AlamedaRenter

      All projects under CEQA must address CO2 per AB32…there is wiggle in depth and methodology of that analysis.

  4. Posted by ExSFlandlord

    Seems that every single project shown in the photo above ,i.e 725 Harrison will have some shadow impact on South Park which is protected by the SF Rec & Park shadow ordinance Prop K; Planning code section 295.

    • Posted by SocketSite

      According to Planning: “Of the Large Cap office allocation applications on file, only two projects would or have the potential to shade a Recreation and Park Department property. The project at 542-550 Howard Street (Transbay Parcel F) has completed a shadow study finding that the project would shade Union Square and Willie “Woo Woo” Wong Playground. The project at 400 Second Street has not completed a detailed shadow study, but initial evaluation indicates this project may add net new shadow to South Park. The review of this project will not be completed until mid to late Fall of this year.

      No Central SOMA projects currently under consideration, except possibly 400 Second Street, will have shadow impacts on Rec/Park property. Shadows on other types of open spaces have been considered, per the normal procedures of the environmental review analysis.”

      • Posted by ExSFlandlord

        We will monitor each and every project shown in the photo above to see if there are any shadow impacts to South Park. Should there be net loss of Sun Light on South Park under Sec. 295 we will appeal the projects to the appropriate city Commission or Board.

        South Park is home to at least 80 SRO low income/disabled/Senior units. The development community should take note that most of these low income residents live on South Park and depend on South Park for Sun light and open space. Most live in 10′ x 10′ Single occupancy hotel rooms.

        • Posted by Ghostwriter

          I’m willing to accept limited shadow impact on South Park in exchange for transit-oriented housing and jobs funding community investment and improvement. Lets be realistic, the park will continue being utilized by all types of users with or without potential shadow.

          Central SOMA is currently completely underutilized. It’s appalling how many large lots are sitting there wasting away, especially with a new subway coming on-line and the need for new housing.

          Delay projects if you must, but change is coming and it’ll be good for the City as a whole.

          • Posted by ExSFlandlord

            I guess “good for the City as a whole” depends on your point of view. I suggest poling the residents who reside on South Park and live in 10′ x 10′ SRO rooms if they would be OK with the loss of sunlight on South Park.

        • Posted by Spencer

          have you considered that more than 30 minutes of sun per day is actually bad for you?

    • Posted by Anonymous

      You’ve claimed this numerous times without providing a shred of evidence to support the assertion.

  5. Posted by Rstr

    From this rendering, it looks like they are planning to completely erase everything that currently stands in SOMA. Goodbye history! Yikes!

    • Posted by moose

      Erasing history here will be a great thing – what’s currently here is awful or bland at BEST.

    • Posted by Anonymous

      Just because something is old doesn’t inherently make it worthy of preservation. Most of SOMA’s history, even in living memory, involves warehouses, rust, and blight.

  6. Posted by Dave (Seattle dude)

    Aren’t these projects contingent on the Central SOMA plan surviving the legal challenges to it – insofar as many of these parcels are upzoned as part of the Plan? That said, it is outrageous, but not unexpected, that the city is pushing office development over housing development in the Central SOMA. Hopefully some of the legal challenges win out. The plan needs to go back to the drawing board, the housing component needs to be increased, the office component decreased. And new office development must be tied to shovels in the ground new housing development.

  7. Posted by Orland

    Can’t we just have a referendum on dumping M?

  8. Posted by al

    Is there any word on potentially adding to the pool all the square footage that was converted from office to residential? Which won’t require a ballot?

  9. Posted by hey

    SF gov is so silly. They’re worried about shade when most trees grow horizontally because of compressed wind snaking between buildings; good for wind tunnel testing cars

    • Posted by ExSFlandlord

      Prop K was a voter initiative and approved by the voters of San Francisco. Prop K was not initiated by “SF Gov”. I guess you say the voters in SF are “silly” to protect their parks from shading by large, tall, bulky buildings. Some would no doubt agree with you and some would not.

      As for the comment above from “Anonymous” (“claimed this numerous times without providing a shred of evidence to support the assertion”), I assume that it’s response to me about the potential shading of South Park.

      It’s not up to me to provide a shred of anything to make my point. Sec. 295 will be applied to any development over 40 feet where there is a net loss of sun light on South Park or any park under Rec & Park jurisdiction. 400 Second street being only one example of large scale, bulky, tall buildings near enough to South Park to cause a net loss of sun light on the park.

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