homesmillbrae.com

A: Our Bay Area real estate market is very vibrant and from a sellers standpoint, the envy of most other areas in the country.

But buyers are very savvy. They do their homework and are intimately aware of comps and values.

In order to obtain multiple offers it is extremely important to have your property in as good condition as it can be. Successful sellers spend a lot of time and money preparing their houses for sale, and it absolutely pays off.

Current buyers are willing to pay for “move-in condition” (fresh paint, updated appliances, and a lovely garden). The more objections the seller can eliminate, the better.

However, the most important factor is the list price. It is almost impossible to “underprice” a home in this area, because buyers will aggressively bid it up. Slightly underprice. Don’t slightly over price!

And finally, it is important to set a date to hear all offers so there will be competition, and not have your property presented as “off market” or accept a preemptive bid, as you might leave money on the table.

Anian Tunney, the Grubb Co., 510-928-7447, tunney@grubbco.com.

A: Here’s a four step formula for getting the highest selling price:

• Improve the property’s condition. Paint, clean and stage if you can. Repair small maintenance issues.

• Use the multiple listing service. This ensures that the maximum number of buyers and agents will see the property.

• Hire an agent to deploy a comprehensive marketing plan. Think compelling photography, digital and print material.

• Price slightly below market. Create a sense of urgency by making your property look like an exceptional deal compared to the competition. Do not price too high.

San Francisco buyers are conditioned to offer higher than the list price. Buyers are hesitant to make an offer on a property that is priced at or above the true market value because they don’t want to waste their time or offend the seller. Statistics show that overpriced properties take longer to sell and eventually sell for less than realistically priced properties. The longer a listing stays on the market, the more buyers will think there is something wrong with the property.

John Solaegui, Compass, 415-999-0673, john@havengroupsf.com.

A: The best strategy can be described as two peas in a pod: Ppreparation and Pricing. What the public sees is a fraction of what has gone into getting to curtain time. Inspections have been done, perhaps remedial work performed. The property has been spruced up, the disclosure package completed, a stager engaged, professional photos taken so the house looks its best on social media.

And second: Pricing. Buyers do not look at just one neighborhood, but rather evaluate choices in their price range. The savvy agent knows the demographics of the likely buyer, identifies competing properties and tracks them. Then lists below the best estimate of the final sales price so as to generate multiple offers, always keeping in mind that the market can turn on a dime, that what was true a few weeks ago may no longer be valid.

Astrid Lacitis, Vanguard Properties, 415-860-0765, astrid@vanguardsf.com.

San Francisco is home to some of fashion’s biggest names: Levi Strauss Co., Gap and Old Navy.

But in three neighborhoods — North Beach, Chinatown and Hayes Valley — those local companies are banned from opening new stores.

That’s because the city forbids chains, defined as having more than 11 locations globally, in those areas. The bans were passed starting in 2004, after residents fought the encroachment of large corporations into neighborhood retail districts. Other areas require additional permits for such stores, also known as formula retail.

Chain store bans may hinder the city’s ability to adapt to changing consumer tastes, said Karen Chapple, a UC Berkeley regional planning professor.

“Zoning ordinances are really inflexible in terms of types of uses and become out of date when demand for the types of spaces wanted is ignored,” Chapple said.

But supporters say the restrictions preserve the eclectic streets, preventing San Francisco from looking like every other city.

The formula retail ban helps protect smaller retailers by keeping rents down and blocking deep-pocketed corporations from invading, said Kathleen Dooley, a commissioner at the city’s Office of Small Business.

Dooley, who ran a North Beach store called Columbine Floral Design from 1985 to 2005, said allowing chain stores that can pay twice as much rent can devastate small businesses.

Being creative and filling a consumer niche, rather than bringing in an existing brand, is the path to success, she said.

“Nowadays, you can’t just put any old thing into brick and mortar,” she said, citing North Beach’s Cole Hardware and Al’s Attire as successes. “You have to be smart. You have to make it a destination.”

Chain store bans are rare. Nantucket, Mass., banned downtown chains in 2006. Jersey City, N.J., recently repealed 2015 chain store restrictions after a developer sued the city.

Some say the ban makes it even more challenging to fill the dozens of empty storefronts, especially in North Beach, which saw the city’s biggest spike in vacancies last year. More than a fifth of storefronts in the area are shuttered.

Edward Schmitt of EMJ Capital is trying to lease a North Beach restaurant space inside a new condo building at 601 Columbus Ave.

The space is 4,700 square feet and rent is $25,000 a month, with a five-year minimum commitment, making it one of the largest and most expensive listings in the area.

Schmitt said multiple chain restaurants had expressed interest but aren’t allowed in North Beach.

“They’re so strict in that area,” said Schmitt. “That limits you quite a bit.”

National and global chain stores are better able to survive San Francisco’s lengthy permitting process and high construction costs, he said. In contrast, first-time business operators and local stores have fewer financial resources, and don’t necessarily have the name recognition to draw a crowd compared with a chain.

“It’s very difficult to bring in a brand-new, non-marketed name to a space of that magnitude and size in North Beach,” Schmitt said. “You’re going to need quite a financial backing to take the beating of the first year or two.”

The developer has spent almost $1 million in construction costs for infrastructure like gas, electrical, water, exhaust hood, floor drains, grease traps. Building out a restaurant could take as much as $2 million more — a big hurdle for a small operator — he said.

Schmitt said more than 50 prospective tenants have toured the space. “That’s why we’re being so selective and choosy,” Schmitt said. “It’s the only brand new building in North Beach.”

Coincidentally, the building that Schmitt is marketing, which is branded the Palace at Washington Square, was previously the site of a battle over a chain store.

The site was previously the Pagoda Palace movie theater, which opened in the 1900s but closed in 1994.

In 1998, future Supervisor Aaron Peskin and other North Beach residents successfully fought off a Rite Aid pharmacy chain store that wanted to open in the empty theater. Rite Aid abandoned the plan in the face of opponents who didn’t want a big corporate drugstore, and the building stayed vacant for nearly two decades before it was demolished and eventually replaced by the new condos.

As a supervisor, Peskin helped pass a formula retail ban in North Beach in 2005 with broad local support. Some existing tenants like Bank of America were grandfathered in and allowed to stay.

There is no statistical evidence that shows the formula retail ban is causing vacancies, Peskin said. The ban continues to have strong support, he said.

Only 28% of 245 North Beach residents favored revising the chain store ban in a recent survey about how to help small businesses distributed by community group North Beach Neighbors. But 70% said they’d be open to easing restrictions for a Bay Area company with multiple locations.

Danny Sauter, North Beach Neighbors president, said he thinks North Beach’s shops can thrive with a chain store ban.

Chinatown, where chain stores are also banned, has an 11% retail vacancy rate. That’s right around the city average, according to a city survey.

Hayes Valley has a chain store ban, but it is booming and filled with new restaurants and shops, including trendy brands like glasses retailer Warby Parker and shoemaker Allbirds, which is opening soon. Warby Parker opened in 2014 and narrowly missed chain store status. Its Hayes Valley shop was its 11th worldwide location, so it didn’t count as a chain, though it now has almost 100 locations. Allbirds, which is headquartered in San Francisco, has six other locations.

Pamela Mendelsohn, a partner at retail brokerage Maven Commercial, said Hayes Valley has benefited from proximity to City Hall and tech company offices and a central location with abundant transit. It also has multiple new housing projects, which increase foot traffic.

Real estate professionals and residents say the city’s chain store policy is just one factor in a complex set of challenges facing retailers, who also struggle with high construction costs and lengthy permitting.

“It is a tough balance. You want to evolve with the times. You want to provide services, provide retail, provide experiences that are in demand right now,” Sauter said. “But you don’t want to lose the history. You don’t want to turn this into something that it isn’t. You’ve got to stay true to the history without going back in time.”

Chronicle staff writer Shwanika Narayan contributed to this report.

Roland Li is a Chronicle staff writer. Email: roland.li@sfchronicle.com Twitter: @rolandlisf

The assessed value of all taxable property in the Bay Area rose to $1.8 trillion for the 2019-20 fiscal year, up 6.6% from last year, according to county assessors who released their annual rolls over the past week.

Growth rates ranged from 8.1% in San Francisco, thanks to a continuing surge in new construction, to 4% in Sonoma, which is recovering slowly from the 2017 fires.

For the Bay Area as a whole, this year’s growth rate was below last year’s 7.8% increase. Some assessors said a slowdown in home sales led to a slight slowdown in their growth rates. Although the median price of all Bay Area homes and condos sold last year rose about 11% from 2017, the number sold dropped to 81,131 from 86,738, according to CoreLogic.

San Mateo, Santa Clara and San Francisco got big boosts from new construction and land purchases by companies such as Facebook, Google, Genentech, Gilead Sciences and Salesforce.

Counties count on new construction and property sales to keep their property taxes growing. Under Proposition 13, real property in California is assessed, generally at market value, when it is constructed or (with some exceptions) when it changes hands. In between transfers, it can go up only by an inflation rate capped at 2% a year, plus the value of major improvements or additions. That inflation bump can be a significant contributor to roll growth for some counties.

The roll is the assessed value of all taxable real and personal property in a county as of Jan. 1 each year. It’s the amount subject to property tax, which averages 1.2% in California, including voter-approved local taxes. Assessed value is usually less than market value, often far less. Assessors have until July 1 to release their rolls for the fiscal year beginning that date.

The roll includes real property — land, homes and buildings — along with boats, aircraft and business property such as office and manufacturing equipment. It excludes tax-exempt property owned by hospitals, colleges and other nonprofits; and property that is not taxable, including most government property.

Property taxes go to schools, county programs such as sheriffs, jails, courts and social services; and to cities within each county.

San Francisco’s roll grew to $276.9 billion, up 8.1% from last year. “Active construction activities contributed most to the growth. Among the top ones are Salesforce Tower with $355 million added in value and the Warriors’ Chase Center arena with $334 million added in value,” a spokeswoman for the assessor said in an email.

San Mateo County’s roll grew to $238.4 billion, up 7.1%. That was a little below last year’s 8% growth rate, mainly because of a slowdown in residential sales, said Terry Flinn, San Mateo County special assistant to the assessor.

Gilead Sciences added $449 million to the roll, most of that from the construction of two buildings at its Foster City headquarters. The next biggest contributors were Genentech ($446 million), Facebook ($271 million), Facebook subsidiary Hibiscus Properties ($214 million) and Google, which added $165 million in Redwood City and San Bruno. Together, Facebook and Hibiscus were the biggest contributor, thanks largely to the completion of MPK 21, its new Frank Gehry-designed headquarters in Menlo Park.

Genentech, despite its unrelenting property-tax appeals, overtook United Airlines as San Mateo County’s highest-assessed taxpayer. Genentech’s properties are now assessed at $2.7 billion, followed by United at $2.4 billion and Gilead at $2.2 billion. United’s most valuable property is its aircraft, but it also owns a giant maintenance facility.

Santa Clara County’s roll rose 6.8% to $516 billion, biggest in the Bay Area by far. It can thank Google for its $759 million addition to the roll, and Apple for adding $271 million; together they accounted for 3% of the county’s increase. Apple’s increase was smaller than last year’s, when it added $1.5 billion from construction at its “spaceship” headquarters and the purchase of office buildings and business property.

Assessor Larry Stone said he’s often asked to compare the county’s building boom to the one in the 1990s dot-com era. He said the previous one “was largely speculative, builders were building spec buildings to lease primarily to startups and young companies with no earnings. When we went from the dot-com boom to the dot-com bust, some tenants went belly up or walked away from their lease obligations.”

Today, he said, “Apple, Google, LinkedIn, Nvidia are buying land and building buildings that they occupy. That is a different type of stability going forward that we never had before.”

He added that San Jose is finally getting the kind of high-value commercial and industrial development that in the past went to places like Santa Clara, Sunnyvale and Mountain View. After languishing in the bottom third of the county’s cities in terms of roll growth, now it’s in the top third, he said.

Google has been gobbling up property in downtown San Jose, some from the city at prices far above their previous assessments. Although its purchases have sparked protests, “the city made a ton of money” without giving Google any concessions, Stone said.

Marin County’s roll grew 5.1% to $82.2 billion. Some of the county’s largest property sales didn’t contribute much to its roll growth and one even detracted, Assessor Shelly Scott said. The Embassy Suites hotel in San Rafael sold for $37.9 million, not much ahead of its prior assessment of $34.3 million.

The biggest residential sale was an estate at 800 Corte Madera Ave., once owned by the late concert promoter Bill Graham. It sold in July for $21.4 million, below its previous assessment of $22.5 million, Scott said.

The sale of two office buildings in Novato did bolster the roll, by $18.6 million.

Alameda County’s roll grew 7.1% to $309 billion, “mostly from general growth in real estate,” said Assessor Phong La.

Contra Costa County’s roll grew by 5.3% to $215.2 billion. “We’re not like Santa Clara County, where they have Apple and Google (building like crazy). That’s Larry Stone’s gift from God,” said Contra Costa Assessor Gus Kramer. “We’d like to be the industrial giant we were in 1968, but we’re not,” he added. In that year, 39% of the county’s tax base was commercial/industrial. Today it’s 6% to 8%, he said.

Rising home prices in towns such as Brentwood and Oakley, which were hit hard during the recession, helped Contra Costa’s roll grow. When the market value of a home falls below its assessed value, homeowners can request a temporary reduction in assessed value. This is known as a Proposition 8 reduction, and during the recession, hundreds of thousands of Bay Area homes got them, some automatically.

As prices recover, the assessor can raise the assessment of a home in Prop. 8 status to its market value, even if it exceeds 2% a year, until the assessed value reaches the point it would have been had it never gotten the Prop. 8 reduction. This restoration in value can add significantly to the roll in some counties.

Contra Costa County still has about 20,000 homes with a Prop. 8 reduction, down from a peak of 190,000. By comparison, San Mateo County has only 245 homes in Prop. 8 status, down from 34,700 in 2011-12.

Solano County still has about 8,900 homes in Prop. 8 status, down slightly from 11,000 last year. The Solano real estate market “is not progressing greatly. There are a lot of homes for sale with high listing prices, but we are not generating a lot of sales,” said Lance Houser, Solano’s assistant assessor. Solano’s roll grew 5.5% to $58 billion.

Sonoma County has requested an extension for its roll but expects it to rise 4% to $92.6 billion. The October 2017 wildfires destroyed about 5,300 properties and wiped $1.8 billion off the county’s roll last year. As of Jan. 1, only about 130 properties had been replaced in Santa Rosa, although the city expects another 2,000 completions by this time next year, said Greg Walsh, the county’s chief deputy assessor. When those properties are replaced, the assessor restores them to their pre-fire value, and does not reassess them unless they have a new owner.

Napa County, which lost about $500 million in assessed value because of the fires, fared a little better thanks to some winery and vineyard sales. Its roll rose 6.6% to $41.9 billion. Napa County Assessor John Tuteur said the real estate market there “is cooling off a bit. I think we are going to plateau for a while.”

Kathleen Pender is a San Francisco Chronicle columnist. Email: kpender@sfchronicle.com Twitter: @kathpender