Meeting with building trades leaders, Newsom unveiled two proposals. The first, known as the “Development Impact Fee Reform & Deferral Program,” would radically simplify the collection, enforcement and notice procedures for all city development impact fees. The second proposal, known as the “Affordable Housing Transfer Fee Program,” would provide developers the option to reduce the city’s affordable housing requirements on new projects by 33% in exchange for a permanent 1% transfer fee that would generate permanent revenues over the long-term (up to 18 years, some say) for the city’s Affordable Housing Trust Fund.
Basically, the mayor’s plan is to get projects going quicker (maybe two months from approval to ground breaking) and create jobs, but given the city’s past hysterics regarding large-scale projects, this will not be an easy sell.
Newsom says the economic benefits to the city of earlier construction starts include earlier increases in construction jobs (duh), property tax reassessments and transfer tax proceeds, all of which would benefit the city’s general fund and budget (another duh). He says both proposals were crafted with input from city agencies and public stakeholders from the affordable housing, real estate development, building trades and urban planning community.
A series of case studies of previously-entitled projects -- 201 Folsom Street, Rincon Hill Tower II, 1960-1998 Market Street, and 2001 Market Street -- demonstrate that the development stimulus package could speed up financing and start times as much as two years. Newsom says these four projects alone would employ approximately 700 union construction workers and they represent only 1,200 units of the more than 5,000 units already approved in medium to large multifamily residential projects waiting to be financed.
I remember hearing about these projects over the years. Many of them were delayed endlessly by local neighborhood organizations that were put off by the projects’ size and scope. One project that’s been heavily scrutinized is the 1960-1999 Market Street complex, which would be located on a 21,200-sq-ft site at the northeast corner of the intersection of Market, Duboce and Buchanan Streets. It would include a nine-story, 85-ft-tall mixed-use building totaling approximately 146,800 sq ft in area, including ground floor parking with approximately 108 condominium units, 86 off-street parking spaces located on the ground floor and in two below-grade garage levels, and three ground-floor commercial spaces totaling 8,150 sq ft. Developer Brian Spiers hired the high-octane architectural firm, Arquitectonica, to do the design.
201 Folsom is the second phase of Tishman Speyer’s two block development that would be located southwest of phase one, The Infinity. Knowing how local advocacy groups love highrises (and shadows), this twin-tower project would go 43 stories and 38 stories and provide 820 units altogether. Heller Manus is the architect.
The 201 Market project is probably the most likely to happen first, given that it’s anchored by a neighborhood-serving, wholesomely green Whole Foods Market. Eighty condos would be above the store. Developer The Prado Group has put together a good design team, too, with William McDonough + Partners, BAR Architects and April Phillips Design Works. Last we heard, the developer is seeking to get the project’s planning approvals from the city’s Planning Commission in April. If successful, Prado Group plans to start construction early 2011.
And the fourth project is the long-delayed One Rincon Hill tower two, which was originally scheduled to start construction in March 2008. With the economic meltdown just beginning in earnest, developer Urban West Associates put on the brakes and no new date is on the horizon.
Anyway, we’ll see what happens with the mayor’s stimulus plan. Any project that gets off the ground as fast as humanly possible is a positive in this economic climate.