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Tenant advocates and property managers in San Francisco’s hyperactive real estate market are fretting about new earthquake safety rules that will spike the cost of repairing older buildings and ultimately increase monthly rents.

 
On the anniversary of the 1906 earthquake that killed hundreds of people and leveled much of San Francisco, the city approved a new law Thursday requiring thousands of apartment buildings to be upgraded to better withstand tremors.
 
Owners of about 3,000 multi-unit residential buildings sprinkled throughout the city will have to shoulder the sizeable costs of the seismic retrofits but will be allowed to pass on those costs to tenants, although some may qualify for an exemption.
 
In a city where a one-bedroom apartment rents for nearly $2,200 per month, any increase to the already sky-high cost of housing prompts a conversation.
 
“Tenants are struggling already, so paying even an extra $50 on top of that is pretty hard for most people,” said Ted Gullicksen, the director of the nonprofit San Francisco Tenants’ Union. “The heftiest rent increases will be in the smaller buildings, just because there are fewer tenants to share the costs.”

Mayor Ed Lee signed the bill Thursday, saying the measure would better protect the nearly 60,000 people who live or work in those buildings from potential disaster.
 
“This mandatory seismic retrofit program will protect San Franciscans, protect our housing stock and ensure San Francisco can rapidly recover from the next earthquake,” Lee said in a statement. “We renew our commitment to making sure that disasters such as the 1906 earthquake and fire do not devastate our city again.”

The retrofitting legislation covers so-called soft-story multi-unit buildings built before building codes were changed in 1978 – that is, those with three or more stories that are wood-framed and have a garage or other similar opening on the ground floor.
 
Owners of suspected soft-story buildings will receive notices in the mail, which will give them a year to get an inspection to determine whether they need to retrofit.
 
Authorities estimate the upgrades could cost around $60,000 to $130,000 per building. Lee said banks are developing financing packages for owners to help pay for the work.
 
As part of a compromise with tenant advocates, the city also agreed to streamline its process for qualifying those who make less than $78,000 per year for a hardship exemption from the pass-through costs.
 
A separate, pending city ordinance would exempt single parents on welfare or senior citizens from the retrofitting-related rent increases.
 
While much of the city’s real estate market is soaring thanks to a tech boom that has attracted giants such as Twitter to the city’s downtown, many apartment owners are limited in what they can charge because most private units are rent controlled, said Charley Goss, government and community affairs coordinator of the San Francisco Apartment Association. That is often the case for owners of the buildings most likely to be affected in the Mission, Western Addition and Marina neighborhoods, he added.
 
“The owners that can best shoulder the costs probably would have rented their apartments recently, so would be getting their full market value,” he said. “Those who haven’t will likely have to get a refinance on their building or get a second mortgage or a loan.”
 
Robert Link, who owns a small property management firm, said he would have to spend about $70,000 to retrofit an Edwardian multi-unit building he owns in the inner Richmond.
 
“The ultimate beneficiary here is not the property owners but San Francisco tenants, because doing these upgrades will preserve rent-controlled buildings,” he said. “Really what this requires is managing tenants’ needs and expectations of the process, and giving them advance notice of as much as you can of the work to be done.”
 
San Francisco’s rents have been climbing in the last several years, leveling off only recently as experts say the market has approached saturation.
 
Rents average $2,175 for a one-bedroom, one-bathroom apartment, according to RealFacts, a Novato consulting group that tracks apartment complexes with 50 or more units.
 
After the Loma Prieta earthquake in 1989, San Francisco mandated retrofitting of unreinforced masonry, or brick, buildings. But the effort to bolster soft-story apartment buildings was a tougher sell, and was opposed by owners and tenants rights advocates concerned over the rent increases.
 
Seismologists predict that a significant earthquake in the region – two to three times as strong as Loma Prieta – is likely to occur within the next 30 years.
 
“When an earthquake happens, these buildings will be vulnerable. If we’re going to be able to recover, this is a necessary step,” Goss said.

Copyright Associated Press

Article source: http://www.nbcbayarea.com/news/local/San-Francisco-Mayor-Ed-Lee-Signs-Quake-Retrofit-Law-203827081.html

Sources familiar with the deal – an effort more than a year in the making and involving the China Development Bank and Chinese Railway Construction Corp. – tell us it fell apart largely over demands by the Chinese for more control over the developments than Lennar was willing to give.

Word of the deal’s collapse came Thursday, just after Mayor Ed Lee returned from a weeklong trip to China.

He had been hoping to trumpet news that Lennar and the Chinese had reached final terms on the landmark agreement. Instead, he got to answer questions about whether the two biggest development projects on the boards in San Francisco were DOA.

The timing was especially ugly, coming just a day after Gov. Jerry Brown, on his own trade mission to Beijing, announced a $1.5 billion deal with a different Chinese outfit to build a big residential project in Oakland.

“I had wished we could get the funding done, and I’m going to continue to try and help Lennar do it,” Lee said, suggesting San Francisco’s hot real estate market was ready to attract more domestic investment.

Lennar had secured a tentative agreement from the Chinese late last year to finance thousands of new homes and offices at the former naval shipyard, Candlestick Point and Treasure Island. Construction was set to start as early as the end of this year.

Lee said he was not privy to all the discussions between Lennar and the Chinese that led to their deal collapsing. But sources inside and outside City Hall privately tell us both sides had been uncomfortable with how the talks were proceeding.

Seeking better returns

For starters, under Beijing’s recently installed new leadership, the Chinese continually sought assurances of a better return on their investment. That meant that if certain performance measures weren’t met, they could take greater control of the project.

“They kept moving the goalpost,” said one source, who declined to speak for the record.

The locals also had their doubts – not about the Chinese bank’s financing, but about using Chinese Railway Construction Corp. as the general contractor, because the company wasn’t familiar with San Francisco’s local hiring requirements.

Add it all up, sources say, and it was simply time for Lennar to look elsewhere for financing.

“The housing market in San Francisco is hot, hot, hot, and moving with speed is incredibly important these days,” said one source outside City Hall. “And waiting around for the Chinese central government to act probably is not the best way to capture a free-enterprise market.”

Despite the deal’s collapse, Lennar is still planning to begin construction on at least 200 homes at the Hunters Point shipyard this summer using a San Francisco-based contractor.

However, it wasn’t immediately clear what the absence of deep Chinese pockets will mean for the rest of the shipyard project or for the development on Treasure Island, where Lennar hopes to build several 30- to 40-story residential towers.

Lennar’s plan

Lennar issued a brief statement late Thursday, saying only that it is “continuing to move forward with development of Hunters Point shipyard” and that “lenders continue to have significant interest in financing the shipyard and Treasure Island, which they believe are extremely attractive projects.”

As for the Chinese?

Well, they aren’t talking. But it’s worth noting that within the past couple of days, reports have appeared saying the longtime chairman of the China Development Bank, Chen Yuan - who only two months ago was reconfirmed by the new government – is being replaced.

Phillip Matier and Andrew Ross are San Francisco Chronicle columnists. Matier can be seen on the KPIX-TV morning and evening news. He can also be heard on KCBS radio Monday through Friday at 7:50 a.m. and 5:50 p.m. Got a tip? Call (415) 777-8815, or e-mail matierandross@sfchronicle.com.

Article source: http://www.sfgate.com/bayarea/matier-ross/article/S-F-China-development-deal-falls-apart-4427448.php

A years-long effort to build a performing arts and education center at the intersection of Market, Turk and Mason streets could collapse now that an out-of-town property owner has ended talks with the project’s backers and put the lots up for bid.

“I’m hoping that whoever ends up with the property is willing to do an arts component and not just make everything market rate,” said Will Thacher, whose family has owned the rest of the proposed project, the adjoining property at 950-964 Market St., since 1937. “But San Francisco is one of the hottest real estate markets in the nation and Mid-Market now is one of the hottest areas in the city.”

It wasn’t always that way. Just a few years ago, Mid-Market was a seedy urban desert plunked in the middle of the city’s signature boulevard. Then-Mayor Gavin Newsom and current Mayor Ed Lee worked to create tax breaks and incentives to bring in businesses to replace the empty buildings, boarded-up storefronts and cheesy retail shops that contributed to the area’s dangerous, down-at-the-heels vibe.

Against that background, the plan for a mixed-use arts center that would transform three-quarters of one of the sketchiest blocks on Market Street was a gift from above. City officials, the arts community and neighborhood groups from the adjoining Tenderloin quickly embraced the plan.

“Theater groups are getting priced out of the city, even as people are coming to the city for the arts,” said Carmela Gold, president of the Tenderloin Economic Development Project, which has put together the proposed arts project. “If you talk to anyone in the arts, even an organization as big as (the American Conservatory Theater), they’ll say they’re going to be priced out of the city in five years.”

The plan for the 950 Center for Art and Education calls for four small theaters, rehearsal space, meeting rooms and public areas that could be shared by several performing arts groups, along with office space. ACT, which is converting the nearby Strand Theater into another performing space, would also use the new center for administrative and education efforts, according to a January 2013 report on the project.

“We want to provide affordable space for arts groups that are being squeezed out of the city because of what’s happening in the real estate market,” said John Clawson, founder of Equity Community Builders, the development consultant on the project.

With the arts activity on the second and third floors of the proposed development, there would be room in the sprawling building for street-level restaurant and retail space, as well residential or office uses on higher floors, making the project more attractive to a developer.

Ideal for small groups

The shared space idea is perfect for small local theater groups, which wouldn’t be burdened with the day-in, day-out costs of running their own performance spaces, said Steven Anthony Jones, artistic director of the Lorraine Hansberry Theatre.

“We can share office and rehearsal space and put the money we save into the artistic side,” he said.

But, except for Thacher, property owners’ early interest in the arts plan waned as the price tag rose on Mid-Market property. The Lone Star Fund of Dallas, which now owns the other three Market Street parcels earmarked for the arts center, turned down an offer by the project’s backers and opted to put the properties up for bid late last month.

City officials, however, continue to see the arts as a major part of Mid-Market’s revival. On Jan. 30, the mayor and Supervisor Jane Kim sat down with the arts center’s sponsors and potential bidders for the Lone Star property and made it clear the city would work with developers to get the deal done.

“We’re excited about the economic growth we’re seeing,” Kim said. “But the concept also was to recognize the existing community that had always been there … and continue to protect services and the arts who were the area’s original tenants.”

Trying to stay in S.F.

If the arts plan dies, it will be a loss to the city and the artists who make it home.

The Lorraine Hansberry Theatre has been the Bay Area’s signature professional black theater company for 32 years, all of it spent in San Francisco. But after losing their theater a few years back, “we’ve been barnstorming, making plans and then looking for a venue,” said Jones. “This would mean we’d have a permanent home.”

Without the new arts center, “I’m not sure we can stay in San Francisco,” he said.

For now, there’s not much Gold and other supporters of the arts hub can do.

“We’re just waiting for Lone Star to pick a winner and then talk with whoever gets the bid,” she said.

But Gold remains confident. The arts center has both political and financial backing and is the type of project that could transform the adjoining Tenderloin neighborhood.

“We want the Tenderloin to benefit from the extraordinary growth of business along Mid-Market,” she said. “We want development to increase to where people are happy to walk down Turk Street.”

John Wildermuth is a San Francisco Chronicle staff writer. E-mail: jwildermuth@sfchronicle.com

Article source: http://www.sfgate.com/bayarea/article/Mid-Market-arts-center-at-risk-amid-boom-4342332.php

The plan – still more of an idea backed by a handful of studies – would continue the transformation of a once-gritty area by creating a new neighborhood full of residences, offices, shops and restaurants, hotels, and entertainment establishments. But opening the area to development would mean major changes to the city’s transportation system and could affect plans for high-speed rail and for extending and electrifying Caltrain.

In addition to demolishing I-280 from 16th Street north and replacing it with an Embarcadero-style boulevard much like the Octavia Boulevard replacement of the Central Freeway, the plan envisions:

– Shrinking – and perhaps eventually eliminating – the Caltrain yard at Fourth and King streets.

– Eliminating the need for deep underpasses beneath a future high-speed rail line, one at 16th Street and one at what will one day be the Mission Bay Boulevard crossing.

— Possibly rerouting the long-planned, but still unfunded, Caltrain extension to the Transbay Transit Center, which would also carry high-speed trains when they arrive in the next decade.

Together, the 20-acre Caltrain rail yard and the massive concrete I-280 structure and right-of-way create a wall that isolates the growing Mission Bay neighborhood from downtown, and is an outmoded and inefficient use of what has become prime real estate, San Francisco officials argue.

‘Something really smart’

“We can do something really smart here,” said Gillian Gillett, Mayor Ed Lee’s transportation policy director and author of a six-page letter that lays out the city’s vision to the Metropolitan Transportation Commission, the Bay Area’s transportation planning and financing agency.

But not everyone is on board. Caltrain officials are concerned that the city’s plans could stall or even stop plans to electrify the commuter railroad, a decades-long effort that moved close to reality only last summer when the state Legislature and the California High-Speed Rail Authority made it part of the new “blended” high-speed train project that will share the tracks, and gave it $700 million.

“We understand it’s a good thing to do, but we are concerned about the implications if we change” the rail yard, said Marian Lee, director of Caltrain’s modernization project.

High-speed trains are not likely to reach the Peninsula until 2026 at the earliest, but Caltrain wants its rails electrified by 2019. With electric power and lighter trains that can start and stop faster, Caltrain could add service, cut fuel costs and reduce emissions produced by its diesel locomotives. Electrification is a key part of the business plan for the financially struggling rail line.

The trouble is that Caltrain is in the midst of revising an environmental impact report for the electrification project. San Francisco officials want that update to include the possible downsizing or elimination of the Fourth and King rail yards. Caltrain officials fear that expanding the study, especially if it requires development of new train storage areas, would mire the project in red tape and possibly endanger the state funding.

“There is an urgency for Caltrain to get electrification in place with expediency,” said Jayme Ackemann, a Caltrain spokeswoman. “With electrification we significantly reduce our operating costs.”

Shrinking the rail yard could increase Caltrain’s operating costs if it needs to store trains farther from the Fourth and King station and bring them downtown to start service every morning, Ackemann said.

Working together

Caltrain and San Francisco have been squabbling over the environmental report and rail yard plans for months, but agreed recently to work together on a study to determine if there’s a simple way to include the city’s rail yard visions without slowing electrification. The study is expected to take about eight months.

“I think we’ve landed on a way of dealing with this that won’t slow the process,” Caltrain’s Lee said. “At the end of the study, we should have a good idea of all the trade-offs.”

Those trade-offs could include money from the development of the Caltrain yard, which might be used to help pay for the connection to the Transbay Transit Center. And if I-280 and the rail yard were to disappear, it could clear the way for a more direct, quicker and possibly cheaper route to the Transbay center.

“This is a golden opportunity,” said Supervisor Scott Wiener, who represents San Francisco on the regional transportation commission. “The rail yard served its purpose for many years, but it’s no longer the best use for that land.”

Michael Cabanatuan is a San Francisco Chronicle staff writer. E-mail: mcabanatuan@sfchronicle.com Twitter: @ctuan

Article source: http://www.sfgate.com/bayarea/article/Razing-I-280-stub-only-part-of-vision-4227940.php

Instead, the Board of Supervisors will push any vote on the deal off into the new year.

Three supervisors – David Chiu, David Campos and Mark Farrell - as well as Ken Rich from Mayor Ed Lee’s office have been in intense talks with Sutter Health’s West Bay president, Mike Cohill, and Warren Browner, CEO of the Sutter-affiliated California Pacific Medical Center. Mediating it all is Lou Girardo, the wealthy millionaire who co-owns Boudin Bakery and once sat on the Police Commission.

The proposal to build a 555-bed hospital on Van Ness Avenue hit the skids this year after it became clear that the hospital behemoth couldn’t commit to keeping the struggling St. Luke’s Hospital on Cesar Chavez Avenue open over the long term. The hospital deal is scheduled to be considered at Tuesday’s board meeting, but sources close to the talks said the item will be continued until next year; negotiations will continue all this week.

- Marisa Lagos

Sounding off: Christina Olague isn’t going out quietly.

The District Five supervisor, who lost her re-election bid last month, went on a bit of a rant last week during a committee hearing on a resolution that would help create a policy on domestic violence for city employees. Olague, who received widespread criticism for her vote to keep Ross Mirkarimi as sheriff, linked political opposition to her re-election campaign by the anti-domestic violence community to race issues and said she has been the victim of bullying by that group and Mayor Ed Lee.

“I recognize bullying when I am being bullied, and as a working-class woman of color, I feel that I have been exploited and bullied extensively by this committee,” she said, referring to an independent expenditure committee founded in the final days before the election to oppose her run. The group raised more than $100,000 and ran ads attacking her for her Mirkarimi vote. “I think it’s very unfortunate that this political action committee that was composed primarily of white women who have not directly worked and intervened with victims of domestic violence have been able to exploit a woman like myself from the working class who is an underrepresented minority.”

The committee was funded by Gayle Conway, wife of angel investor Ron Conway, and Linda Voight, wife of real estate investor Thomas Coates, but headed by Andrea Shorter, also a woman of color. Olague will be replaced by London Breed, who is African-American.

Olague said she hopes that in the future “the number of women of color associated with this issue will increase.”

Supervisors John Avalos - who also voted to keep Mirkarimi as sheriff – and Eric Mar, who did not, both said they supported her comments. Women’s groups have complained that they were harassed and bullied for opposing Mirkarimi’s bid to keep his job following his arrest last January on suspicion of domestic violence and later guilty plea to falsely imprisoning his wife.

- Marisa Lagos

A new plan: The San Francisco Planning Commission OKd a new way forward for development in the western South of Market neighborhood, voting unanimously to adopt a plan that has been hotly debated for years.

The plan, which still needs approval from the Board of Supervisors, calls for adding housing to an area north of Harrison Street, while a second section south of Harrison would be reserved for commercial use.

The creation of the Folsom Street Neighborhood Commercial District would effectively make Folsom Street the “ceremonial center” of the neighborhood, plan architects say.

Entertainment has been a contentious issue in the planning process, with some club owners concerned that adding housing could threaten existing nightlife spots. Supporters of the plan said entertainment would become fully permitted under new zoning for the 11th Street Corridor, which was changed from residential to mixed-use office.

Jim Meko, the chair of the citizens’ task force that has been working on the plan since 2004, said the goal is to make western SoMa a “more complete neighborhood.”

“We took a fresh approach to zoning and it made better sense,” he said. “It’s the most comprehensive and detailed neighborhood plan that the commission has ever dealt with.”

- Neal J. Riley

This week’s news

Monday: The Board of Supervisors Land Use Committee will discuss whether to ban smoking at certain outdoor events. The meeting begins at 1 p.m.

Tuesday: Mayor Ed Lee will make an appearance at the Board of Supervisors for question time, where Supervisor David Chiu will ask when the city will produce a report looking at how city laws impact small businesses and Supervisor John Avalos plans to ask what the mayor is doing to create living-wage jobs to prevent the loss of the city’s middle class. The meeting begins at 2 p.m.

E-mail: cityinsider@sfchroncile.com Twitter: @SFCityInsider

Article source: http://www.sfgate.com/bayarea/article/Vote-on-S-F-hospitals-likely-in-2013-4104095.php

Lee’s no dummy. He knows there’s little, if any, chance such a policy would pass political muster in San Francisco. But that was never the point. He was planting a seed.

“It’s controversial. I will be tagged – as the minority mayor of this city – for racial profiling,” Lee, a former civil rights attorney, said at the meeting. “But I’m going to let everybody know that if it works … I’m going to do something in that direction.”

In his first term, Lee’s displaying the characteristics of real leadership. His decision to boldly go where no San Francisco mayor has gone before underscores both his confidence and control. He’s the captain of this vessel.

That the mere mention of Lee’s plan has made San Francisco Police Chief Greg Suhr and some members of the Board of Supervisors nervous means he may be on to something.

Across the bay, Oakland residents desperately need a mayor with as much resolve.

Whenever Oakland Mayor Jean Quan hears the word “controversial,” she starts moving in the other direction, away from the potential danger. Luckily for Quan, her travel plans have often coincided with controversy at City Hall.

Because otherwise some people might have gotten the false impression that Quan was unwilling – or worse, afraid – to tackle issues head-on, especially when they involve violent crime. When controversy struck last week, Quan cracked like a walnut at a squirrel party.

At a press conference she held to reaffirm the credibility of a crime reduction plan based on bad statistical data, Quan was soon fending off questions about whether she is really committed to fighting crime.

A reporter brought up Quan’s reluctance last year to support gang injunctions and curfews, and the mayor – true to form – revised history. “I’d actually support a curfew that was aimed at hot-spot areas and not a citywide curfew, because I don’t think we have the resources for a citywide curfew,” Quan said.

Really? Because last year, Quan dismissed a proposal from former Oakland Police Chief Anthony Batts, who wanted the city to impose a curfew for underage teens. She outright rejected the idea of using gang injunctions to reduce crime before a court approved their use in two Oakland neighborhoods. A few months later, Batts resigned, saying City Hall was making it difficult to do his job.

In San Francisco, Lee knows he’ll never get the political support needed to enact a stop-and-frisk policy, but he just might get a modified, lesser version that can be used as an effective law enforcement tool.

He has started a buzz, fired a hot potato in the air and opened the door to a public debate about further law enforcement remedies.

It doesn’t matter whether they’re mashed, boiled or french-fried and served with onions, Lee has made it clear that come dinnertime, he expects to see some kind of potatoes on his plate. Period.

Quan has shown none of the same political strength or individual courage needed to do the job of taking on one of the toughest urban crime problems in the nation.

It’ll take the kinds of radical steps proposed by Lee, and used in other cities, for Oakland to get results and achieve a respectable level of safety on its meanest streets. It will also take leadership, which has been the rarity instead of the rule in the Oakland mayor’s office.

Chip Johnson is a San Francisco Chronicle columnist. His column appears on Tuesday and Friday. E-mail: chjohnson@sfchronicle.com

Article source: http://www.sfgate.com/bayarea/johnson/article/For-bold-ideas-on-crime-look-to-S-F-not-Oakland-3680370.php