FOCUS ON CONDOS
Condo units in every neighborhood of San Francisco have risen significantly in value between 2014 and 2015. And quite a few neighborhoods have seen their condo sale prices nearly double since 2011, according to a new report from Paragon Real Estate Group.
Currently the priciest condos are in Russian Hill, where the median condo price is $1,650,000, up from $1,400,000 in 2014
and $872,500 in 2011. The Marina is in second place, with $1,500,000 (2015), $1,325,000 (2014), and $987,500 (2011), according to Paragon. The real estate company says the least-expensive condos over the past half-decade have been in Diamond Heights in central San Francisco, where the 2015 median price is $680,000 and was only $352,000 in 2011.
AFFORDABLE HOUSING FOR FORMER CANDLESTICK LOTS
The city is looking for developers to create 290 new, permanently affordable homes on the former Candlestick Park site. The units, to be built on two separate lots, will target household incomes at or lower than 60 percent of the local median income; 58 of the units will be set aside for formerly homeless families, 10 of which will be for young parents transitioning out of foster care or other services.
Mara Rosales, the chair of San Francisco’s Office of Community Investment and Infrastrucutre, which has released a request for proposals from developers, said the residents will be helped by the affordable housing along with supportive services and amenities. “On-site robust supportive services, 24-hour desk staff, and access to transportation, childcare, and shopping will help ensure people integrate back into our communities,” she said.
Funding was made possible by Senate Bill 107, which resulted in half a billion dollars for affordable housing in San Francisco.
ZONING, LACK OF BUILDING FAULTED
In a roundup of resources and commentary on San Francisco’s real estate crunch, Kriston Capps of The Atlantic faults the city’s zoning, powerful NIMBY forces, and overall lack of construction for causing the displacement of lower-income residential housing.
“Since the residents of high-cost, high-demand neighborhoods tend to have mobility, money, and access to information and power, they are hugely successful in leveraging land-use policies to exclude newcomers,” Capps wrote in “Blame Zoning, Not Tech, for San Francisco’s Housing Crisis. “They protect what is theirs and shut the gate behind them. … So the high-margin development that really should go into the high-end neighborhood winds up replacing cheaper, older, and abandoned housing in low-end neighborhoods.”
Capp also cites an article on Shelterforce.com by Rick Jacobus, part of Street Level Urban Impact Advisors, who argued that cities can’t build their way out of the housing crisis, “but we won’t get out without building.” Jacobus wrote that on a “citywide scale, it seems likely that while development in SoMa may have contributed to displacement, it may have slowed displacement in the Mission as young, high-income tech workers moving to the city for its amazing job market had somewhere else to go when all of their friends were competing for increasingly scarce units in the district.”
Construction Dive’s Kim Slowey says this is not just a boom-time problem. Slowey notes that a report from Curbed “found that new home construction in the San Francisco area in particular has lagged behind job growth so much that in 2015, even though the Bay Area added 64,000 new jobs, housing only increased by 5,000 units. Add rising home prices and stagnant wages for most workers, and experts warn that the area is ripe for a ready-to-pop housing bubble.”
S.F. OFFICE ALSO NEAR HIGH
Office leasing continued at a furious pace, despite a slight pause in occupancy growth, in the final quarter of 2015. The city had “a record-breaking 22nd consecutive quarter of positive net absorption,” reports Colliers International, with SoMa West and SoMa East being particularly strong.
Tenants looking for office space found Class A rents higher than what they’d pay in Manhattan, reaching $75.90 per square foot. But Class B rents have also risen significantly, up more than 53 percent in the past two years, from $47.80 to $73.26 per square foot. Colliers says that office rents continue to increase in San Francisco, but “the rate of increase slowed slightly” in 2015.
BLIND ITEM
A friend of the Roundup shares the story of a tech tenant who complained to his San Francisco office landlord that a recent rent increase would require him to make an unacceptable cut: He would no longer be able to supply snacks to his employees — only breakfast, lunch, and dinner.
