200000 housing units in Bay Area pipeline. Is it enough to move the needle?



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Equity Residential’s Potrero project includes 453 units and 26,000 square feet of retail.





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Emily Fancher
Senior Editor- San Francisco Business Times

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There are 200,000 housing units in the planning pipeline or under construction throughout the Bay Area and approximately 43 percent of those are rental units.

The housing pipeline number, which was reported by a Bay Area real estate consultancy, includes market-rate and affordable projects in San Francisco, the East Bay, Peninsula and Silicon Valley down through San Jose.

About 64,000 of those units are in San Francisco, and that number includes 14,000 units in large San Francisco projects such as Treasure Island, Candlestick Point and Schlage Lock. Schlage will soon be under construction.

The report, created by the Concord Group, predicts that developers will bring to market 18,000 units over the next five years in San Francisco.

The 200,000 units in the pipeline are an increase relative to the size of the pipeline historically. However, relative to the population and the size of the housing stock, the pipeline is fairly modest.

“It’s not going to move the needle that much,” said Tyler Evje, an engagement manager at the Concord Group, who worked on the report.

If you think about the pipeline, there are roughly 200,000 units in the core and 2 million households that live there, he said. So if 10 percent of existing stock is in the pipeline, that’s not that much, he added.

Much of the housing in the pipeline won’t get built or will be built gradually over a very long timeline.

“Many units in the larger projects will have a 10-to-15-year build out or have questionable financing or questionable entitlement (prospects),” said Evje.

The report also dives into the shift from rentals to for-sale units and flexible entitlements. Developers are now seeking approvals for both.

Emily Fancher is a senior editor at the San Francisco Business Times.



Article source: http://www.bizjournals.com/sanfrancisco/blog/real-estate/2014/09/housing-pipeline-report-sf-bay-area-concord-group.html

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