As we outlined back in September of 2020:
Having been approved back in 2016 but yet to break ground, the entitlements for a skinny 495-foot-tall tower to rise at 524 Howard Street, a development which could yield up to 334 condos, or 72 condos over a 273-room hotel, “depending upon market conditions,” were quietly sold, along with the parking lot parcel, to a group of investors for $78 million last year.
And having already been granted four extensions, the operators of the Transbay District parking lot, which is technically a temporary, non-conforming use, were positioning for a fifth extension in order to continue to operate the lot for (at least) another two years.
From American West Parking’s plea to Planning: “In the several years since you last authorized this use, the immediate area has seen a flurry of new nearby office, residential and retail buildings. With that new development, a number of surface parking lots nearby have been developed without replacing the surface parking, making the parking shortage even greater. The pandemic has led to even more people driving downtown.”
And while noting that San Francisco’s General Plan actively discourages parking within Downtown Zoning Districts, but acknowledging that public parking lots “provide off-street parking for essential workers, commuters, and other users of the immediate vicinity,” San Francisco’s Planning Commission is expected to approve the fifth extension, which would allow the “temporary” parking lot to continue to operate through September of 2022, this week.
And with the entitlements for the 495-foot-tall tower having technically expired, an application to secure a sixth two-year extension for the “temporary” parking lot, which would run through the third quarter of 2024, has been filed with Planning. At the same time, building permits for the tower have yet to be requested. We’ll continue to keep you posted and plugged-in.
There has been a steady stream of depressing news coming out of SF on the development front. Every story is about a major project being stalled, delayed, or cancelled. The city and it’s apologists really need to get ahead of the narratives on crime, homelessness, and cleanliness. I, and most who live here, understand these claims are overblown and divorced from reality, but these narratives are taking over the public consciousness and driving away capital, investors, tourists and prospective residents.
It is beyond frustrating when you look at B-tier cities like Austin, Nashville, and Denver have skylines littered with cranes.
They’re just catching up.
As glib as it may sound, there’s likely some element of truth to that: DTSF was quite possibly overbuilt – even a small amount, say 3% of space, would be enough to delay a year or two’s construction – and of course not everyone equates progress with growth in gsf’age.
As for your characterizations of the other cities: Austin is the captial of the country’s second biggest state and the flagship to the UofT; Denver is a major transportation hub – ask me how i know! – and the financial, cultural and distribution center for a multi-state region; I would call them A- tier…at the least.
Yes — Austin, Denver, Nashville are major domestic cities. SF is *supposed* to be a major GLOBAL city. We should be orders of magnitude above.
There is no such thing as a “global” city.
Right — Austin, TX and London are the same caliber of city.
The Global City: New York, London, Tokyo by Saski Sassen, Professor of Sociology and of the Social Sciences at the University of Chicago, and revised 2001
“A very significant book indeed. . . . A systematic detailed analysis of the three largest urban economies in the advanced world.”—Peter Hall, International Journal of Urban and Regional Research
Hahaha ok sure, visit Austin if you want to see a nice, but less international city. They don’t even have many decent Italian restaurants and that’s basically an American cuisine at this point.
Overbuilt, in terms of the ability for worker bees to commute in and out at a sane level? Absolutely. There is no going back to cramming into BART, Muni, Caltrain like has been. Come to think of it, where are with the second Transbay tube and the Caltrain extension to the Transbay Terminal? Right… Austin and the rest – you got to think they are all building themselves into commute hell just like we did.
The tallest buildings currently listed as “under construction” in Austin – including one of 1000+’ !! – seem to be either mixed-use or residential.
You’ve been around the west side recently? Of course zero office tours, yet, rush hour traffic up the yin yang.
This is a residential development, and there’s no universe where San Francisco residential is overbuilt in 2022.
This. Even with the major change in market dynamics over the last ~6 months, and the rise in interest rates, there’s still pent up demand for *affordable* residential in San Francisco. (Source: Just spent the last few months looking throughout S.F., before deciding to move to Marin instead…, given how much more I can get for my money.)
There is a narrative around crime, homelessness, and cleanliness because these issues are significantly worse vs. 10+ years ago in soma, mid-market, civic center, castro and the mission. Yes, south beach, china basin and western addition (and even parts of the TL very recently) are better, but we are nowhere near these concerns being ‘overblown and divorced from reality’. The city’s inability to provide basic public safety, property crime protection and cleanliness and the risk that they’ll just randomly open up an illegal drug sobering center next to your house adds another level of risk calculation to a major capital investment like buying a new house, building new condos or starting a business.
You must not have been around when the last high rise building boom in SF ended in the late 1980’s. Between mid 1960’s and mid 1980’s a lot of buildings went up then relatively little in the next 20 years. Dont see why its going to be any different this time around. That bubble’s burst.
As for SF being a “A Tier City”. When I first got to know SF back in the 1980’s it was still very much an A Tier / National City. Very much like LA and its peers in feel and vibe and very unlike large Regional cities like Portland or Seattle. San Francisco felt like a big city. With a big city history. But in the last two decades SF has become just another regional city. Even before 2020 when I wandered around SF in the late evenings / early mornings it was as dead as small regional cites like Seattle and Portland. And very different from what San Francisco was in even in the 1980’s. Which was still recognizably the San Francisco of the 1920’s or 1930’s.
The “Sophisticated Urban Living” fantasy that was pushed hard over the last two decades proved to be just that, a fantasy. Just like it has proved to be in Seattle with the political mayhem caused by the South Lake Union and related developments. I think 2020 demographically will prove to be just like 1950. A peak population that will not be reached again for many decades. The last huge loss of population for SF (1950-1970) was driven by younger people mostly families leaving trying to find housing, good schools and a better quality of life. Something SF has not been able to offer for many decades and cannot offer in the foreseeable future. You cannot build a strong city with a large transient population of 20/30 years olds and dot commers and suicidal anti-growth ordinances and regulations.
“You must not have been around when the last high rise building boom in SF ended in the late 1980’s. Between mid 1960’s and mid 1980’s a lot of buildings went up then relatively little in the next 20 years. Dont see why its going to be any different this time around. ”
The difference is, Work from home (WFH) didn’t exist in the 80’s. I lived in SF during the 80’s. Maybe you remember Sue Hestor and Prop “M” which was used to cap annual office development. Office development was out of control. The majority of people living in SF hated office development. They didn’t want to see the city change and the spread of hi rise buildings.
Prop “M” and the office bust in late 80’s actually saved many developers from bankruptcy. But I digress. So back to my point, WFH has changed SF forever. Downtown SF will never be the same because of it. I lived in the SoMa from the early 80’s until 2021. Over the last couple of years I would walk past offices that had rows of desks with workers staring at computer screens tapping away at their key boards. I have no idea what they were doing but whatever it was it could be done anywhere. And today that’s exactly what’s going on. These workers are elsewhere doing the same job from where ever.
Any developer has to ask, is it worth the investment when SF has 24% office vacancy today.? Why do workers need to work from a central office building? Building cost and the cost to maintain an office building are all part of that formula. And let’s not forget that inflation is driving up building cost as well. ROR is going down not up.
I am not anywhere near as anti-car as most of the urbanism proponents on this site, but the statement from American West Parking is kinda infuriating.
I can accept the assertion that “the pandemic has led to even more people driving downtown”, but what I can’t understand is why in the world “a flurry of new nearby office, residential and retail buildings” which were developed on surface parking lots somehow requires “replacing the surface parking“. It doesn’t.
Surface parking lots are an incredibly inefficient use of scarce land. The parking can (and should) be replaced by underground parking garages and such a garage could have been included in a modification to the design of the previously approved tower if for some reason the stacked parking for 167 cars previously proposed wasn’t adequate for satisfying the existing demand.
So the developer hasn’t submitted permits yet, so if they turned in today there would still be at least a two [year] time line to getting the permits. So, I think American West should be saying, “it’s either we run a parking lot or it’s a homeless encampment”
Sparky, if it was positioned that way, it would not surprise me if Planning chose the homeless encampment. LoL
Let’s be honest, the city is actually dirty, full of homeless people, unsafe & not business friendly. It’s easy to see why Denver, Austin etc. are growing at our expense.
I think 2019 was probably peak San Francisco; unless there is some serious change in social & economic policy, and a renewed sense of civic decency, it’s all downhill from here.
I was gonna add that part, but then got myself into a loop where planning approves, it gets appealed, goes to the Board of Sups who are the ones to approve for a homeless encampment, but have a recommendation that it be permanent and then that process takes year…
Right; San Francisco peaked in 2019 and there’s no coming back. The set of massive earthquakes, a string of city-destroying fires, and a post-war emigration into the suburbs were nothing compared to a pandemic-induced recession.
As surprising as it sounds, a lot of people (myself included) want to be here and commit to the city. SF just needs to make it slightly easier to build housing and/or convert large, unused commercial space into residential and get serious about local/neighborhood-scale businesses. This city has weathered plenty of bs over its 170-year lifespan and evolved as a result.
Right; it’s the government of SF that is preventing the conversion of office space to residential space, and not the cost-prohibitive physical challenges of doing so. Right.
Institutional office prices in SF haven’t even started falling yet. It will likely begin this quarter, or maybe 4Q2022 once one or two comps come in. If you think sentiment is negative now, wait two years when office prices are down 20%+ for all but the nicest trophy-type space.
Those of us who used to endure the pain of commuting into downtown SF on BART every day are GONE and we’re not coming back (well, to be precise, I have to come back 4 days a month…and I am SOOOO tired of encountering multiple mentally ill people every day I do come in. Life in the city I chose to relocate to is so much better). SF government and its progressive citizens are just starting to get what they have coming to them.
IMHO it isn’t the pandemic and recession, it’s the *still increasing* byzantine and onerous restrictions on development – there’s clearly demand for affordable residential, but between impact fees and surcharges and, on the business side, taxes on successful businesses, etc., it’s becoming unattractive to build here. So it’s not a one-off hit like a major quake; it’s an institutional playing field that is increasingly tilted against development and growth. Every election cycle there’s some new referendum on taxing businesses or landlords or properties – progressives seem to think that S.F. is still the New Jerusalem of tech and startups, but you can’t keep tightening the noose around the neck of the goose, before it stops being able to lay golden eggs. *That’s* at least one reason why Austin, Denver, etc. are still growing… they actually want and encourage the growth.
The rendering shows Parcel F / 550 Howard as a clean expanse but it is anything but that…
The development team [for Parcel F] renegotiated its purchase agreement with the Transbay Joint Powers Authority last spring. Under the previous agreement, F4 Transbay Partners would have had to pay $70 million to the authority if it doesn’t complete the tower by EOY 2023. It would also have had to pay an additional $15 million a year for every subsequent year of delay. The new agreement reduces the penalties and stipulates the tower be completed by EOY 2027.
We’ll add that a permit to start excavating and shoring the F4 parcel has been requested and building permits for the tower have been approved but not yet issued. Work on the site to date has been related to the exploration of designated archeologically sensitive areas, the trenches for which will be backfilled and graded, assuming there aren’t any show-stopping discoveries.
And now back to 524 Howard, or at the very least other parking lot parcels in the area…
Don’t hold your breath. 524 Howard will most likely be pushed back a decade or two. Latest headline from SF Biz time has 9, that’s NINE…and counting, large office and condo building owners, landlords and developers lining up at the Assessment Board of Appeals asking to reduce their property tax valuations by 50%.
Here’s a taste:
222 Second St.
100 Stockton St
41 Tehama St./33 Tehama St
Piers 1 1/2, 3 and 5
555 9th St.
1 Polk St.
2675 Geary Blvd.
633 Folsom St.
212 Stockton St./200 Stockton St.
And if these building owners are successful at having their property values reduced expect the flood gates to open for others. Keep in mind that property owners file appeals all the time to seek reductions. But this time they may have better justification for the reductions due to vacancy, building damage and expiring leases.
I don’t see 524 Howard getting built anytime soon.
633 Folsom just finished a major renovation in 2021 and is fully leased (by Asana, presumably at pre-pandemic rates). What possible justification could they have for needing a break in taxes?
Rent moratorium? Wondering how many tenants didn’t pay rent for two years and instead banked it. Back rent may still be owed by existing tenants.
The Assessment Board of Appeals hearings are public as are the minutes. Be interesting to see the criteria 633 Folsom submits in it’s request for the assessment reduction.