The intersection of Market Street and Van Ness Avenue in San Francisco has become the center of a development flurry, with several projects in the works that may change the face of the area. Four projects are in the works for the area, with some expensive properties changing hands. They include a deal for the Boas family to sell the Honda dealership site at the intersection to developer Crescent Heights, in a $50 million deal that could result in 700 homes being built. In another new deal, Related California is planning to buy a 2.3-acre Goodwill Industries campus nearby, where it may build 600 units. The projects have the potential to put a very different face on the intersection that otherwise attracts very little attention. (SF Chronicle)
Nonprofit organizations could take over management of some public plazas to hold events and maintain the spaces, under a program proposed by Mayor Ed Lee The initiative will impact public spaces that are at least 2,000 square feet and outside of the Recreation and Park Department’s jurisdiction. That list would include Mendell Plaza in the Bayview, Hallidie Plaza at Fifth and Market streets, Jane Warner Plaza in the Castro, and a spot at McCoppin and Valencia streets in the Mission. While supporters say the plan will improve activities in these public areas and help address homelessness in plazas, opponents say it is a step toward private control of public spaces. (SF Examiner)
The city of San Francisco has changed its rules to let some affordable housing projects push closer to the front of the line and speed up review of their applications as part of Mayor Ed Lee’s push to create or refurbish 30,000 housing units by 2020, with more changes on the way. The changes began in February and the city’s planning department and representatives of the mayor’s office will present an update on their efforts Thursday before the Planning Commission. In addition, commissioners will be briefed on efforts by the Mayor’s Housing Working Group to identify ways to encourage more production of affordable housing; streamline application processing and reduce problems with environmental review; and identify funding sources to support low-income and middle-income housing development in the city. Three subcommittees are expected to complete their work by July, and their recommendations could be presented to commissioners late this summer or early this autumn. While the priority changes, expedited review and new rules governing elimination of housing units previously have been disclosed, a draft document sent to commissioners lays out more specifics of how the changes have been applied since February:
- Proposed housing developments with at least 20 percent affordable housing on site (or 30 percent off site) can qualify for priority review, ahead of all other projects except 100 percent affordable housing.
- Projects in those top two priorities now qualify for concurrent review by five city departments at once to expedite permitting. The new rules call for the city’s planning department, Department of Public Works, Mayor’s Office of Disability, Department of Building Inspection and Fire Department to review qualifying proposed affordable housing projects simultaneously, rather than having each department review the proposal in sequence. Not all projects would qualify, even if they met the affordable housing targets for priority review.
- New restrictions make it more difficult to eliminate a dwelling unit from a building with three or more units or merge two units unless both are valued at more than about $1.5 million. The city also has made it more difficult to eliminate unpermitted dwelling units if it’s feasible to convert it to a legal dwelling unit.
Developers have been wary of the expedited review efforts, unsure that the city will be able to speed up the permitting process enough to justify the cost of subsidizing more housing units, especially without other changes that reduce the chance of neighborhood legal challenges that can stop projects in their tracks. During the first quarter of 2014, 2,123 new housing units opened and 24 percent of those were affordable to low-income residents, according to the city. By comparison 2,499 new housing units were constructed in all of 2013, the mayor said. (SF Biz Times)
New owners of the KRON TV headquarters at 1001 Van Ness Ave. in San Francisco plan to transform the site from office to residential. The property joins a slew of new housing proposals along Van Ness and sits just two blocks from the $2 billion rebuild of the California Pacific Medical Center. A partnership between South Beach Partners and Oryx Partners bought the 106,777-square-foot building that was owned by Media General, KRON’s parent company, since 1967. Terms of the deal were not disclosed. The station plans to move to a new space in the north waterfront later this year. Oryx Partners, a new venture, will manage the redevelopment of the property, which is zoned for up to 200 units of housing. The entity is made up of three principals with real estate and development backgrounds including Juan Carlos “JC” Wallace, who recently left SKS Real Estate Partners, attorney John Ramsbacher, and Laura Billings, founder of Sage Green Development. The property hit the market earlier this year and attracted interest from housing, office and medical users. Billings said Oryx plans to pursue sustainable developments in both office and housing and is also working on a residential project at 230-234 7th St. The name of the firm comes from an African species of antelope. (SF Biz Times)
Joining a host of San Francisco hotels showing off their renovations, the Warwick San Francisco hotel has a new look. The Warwick is set to complete its guest room renovation June 1. A new restaurant in the hotel, Aveline, and a new bar, The European, will also make their debut in early June, although a formal date has not been chosen. The hotel, at 490 Geary St., began the $8 million renovation in November, when it closed its previous 50-seat restaurant, La Scene, to make room for the new restaurant and bar concepts. The guest room renovation began in February, though the hotel has renovated in stages based on each floor and has not closed reservations. The Warwick’s 74 guest rooms include 20 suites, none of which had received a revamp at least since Warwick took over the space in 1992. Now, the refreshed rooms will feature a blue and grey color scheme, new or repurposed furniture, such as refurbished armoires and painted headboards, and a central air conditioning system. Framed pictures sourced from the San Francisco public library will be on guest room walls, as a way to make the rooms more personable, said general manager Eric Halliday. The room rates are going up about 30 percent and will start around $300 per night, changing seasonally. Former Top Chef contestant Casey Thompson will head up the kitchen at the 60-seat Aveline restaurant, and will also handle the bar food menu at The European and for Warwick’s room service. (SF Biz Times)
The historic Westin St. Francis hotel is debuting its largest renovation yet. Nearing its 110th anniversary, the Union Square fixture completed a $20 million renovation of its Tower Building — the largest renovation of the 569-room, 32-floor building since it opened in 1972 as an addition to the 1904 Landmark Building. Remodeled by the design team at Strategic Hotels & Resorts, owners of The Westin St. Francis, the guest rooms and corridors will get a new color palette, with shades of blue, ivory, taupe and rusty red. Each room has custom-designed dark wood furniture, large windows with floor-to-ceiling curtains. Modern paintings and mixed media artwork by three San Francisco artists, Derek Lynch, Kristin Kyono and Sandra Russell, and Los Angeles painter Alex Couwenberg, are in the suites and corridors. The guest rooms and suites have a chaise lounge or a chair with an ottoman, and bathrooms are outfitted with marble vanities, new mirrors and sconces. Corridors boast new carpet, wall coverings, ceiling pendants, artwork and furniture, tables, lamps and mirrors at the elevator landings. Owned by Westin Hotels & Resorts, a division of giant hotelier Starwood Hotels & Resorts Worldwide, the Westin St. Francis opened on March 21, 1904. Its Tower Building remains one of the tallest buildings in Union Square. The renovation comes amid a slew of other recent hotel renovations, including the Warwick San Francisco’s recent revamp and the historic Fairmont San Francisco’s $21 million makeover. (SF Biz Times)
A new ballot measure could go before voters in November to raise height limits for waterfront development at Pier 70, allowing a major development at the pier to move ahead. The new measure, pushed by Pier 70 developer Forest City, comes as height limits along San Francisco’s waterfront have become a hot political topic. Proposition B, which qualified for the June ballot, would give voters the power to limit tall projects along the city’s edge. If Prop. B passes, any waterfront development that exceeds existing height limits would need voter approval. The new proposal, the “Union Iron Works Historic District Housing, Waterfront Parks, Jobs and Preservation Initiative,” would clear the way for Forest City’s development of at least 1,000 new units of housing, as much as 1.8 million square feet of commercial space and 400,000 square feet of retail, cultural and manufacturing uses to rise up to nine stories in height on the Pier 70 site, along with nine acres of new parks. The Union Iron Works initiative, should it pass, would allow buildings as high as 90 feet but would not alter other requirements. The Pier 70 project “is required to adhere to all existing environmental review processes, such as the California Environmental Quality Act and approvals by the San Francisco Port Commission and City of San Francisco Planning Commission and Board of Supervisors,” the developer said in a statement. Forest City has until early July to qualify the proposal for the November ballot. Forest City’s development on Pier 70 likely will not start until 2016. But a parallel rehabilitation project focused on a collection of historic buildings at Pier 70, headed up by Orton Development Inc. is already moving ahead. That project would not be impacted if Prop. B passes because the historic buildings do not exceed proposed height limits. Prop. B was widely seen as one reason that the Warriors decided to move their arena to Mission Bay. The Giants recently pledged to downscale their development plan for Seawall Lot 337, which would have been affected by the Prop. B., and drop their opposition to the ballot measure. (SF Biz Times)
If Calico, the Google Inc.-backed aging research company led by former Genentech CEO Art Levinson, is having a tough time nailing down space, you know the Bay Area’s biotech real estate market is tight. Calico has been scouring the market at least since early this year, according to sources, but it hasn’t had any luck yet in nailing down space outside of Google’s Mountain View headquarters Here’s the market Calico and others face as they bring on high-powered researchers: Biotech-focused developer Alexandria Real Estate Equities Inc. last week said its 1 million-square-foot portfolio of properties in San Francisco’s Mission Bay district has a vacancy rate of one-tenth of 1 percent, and its space available in South San Francisco in the first quarter was 6.4 percent. The market will tighten further as HCP Inc.’s previously vacant Britannia Oyster Point II complex on Oyster Point Boulevard in South San Francisco inks more tenants. The vacancy figures (especially the Mission Bay number) are near the thresholds when real estate developers start looking at constructing more life sciences space. Perhaps a company with the gravitas of Calico will provide the weight needed to push construction plans forward and restock the life sciences real estate pipeline. Any project, though, is likely to come too late for Calico’s immediate use. “The market is very, very frothy right now,” said Rick Howe, a spokesman for BioMed Realty Trust Inc., which is entitled to build more than 1 million square feet of lab and office space at Oyster Point and Gateway boulevards. BioMed has not yet announced plans to construct more buildings there, though it has razed a number of one-level structures on the site of the Gateway Business Park. (SF Biz Times)
The San Francisco 49ers are threatening to halt plans by former Niners star Joe Montana to build a hotel and entertainment complex next to their new stadium in Santa Clara, if the team’s parking needs are not met. The team is struggling to find the parking it needs for the stadium, both for game days and for non-football events. The 49ers are entitled to 789 parking spots on the site where Montana plans to build his $400 million project, across the street from the new Levi’s Stadium. The city has proposed some 4,000 spaces, but the team has rejected most of them, saying they are too far away or have other problems. Niners President Larry MacNeil said in a February letter that Santa Clara would need to come up with 8.5 acres of replacement parking if Montana’s project is to go forward. (SF Chronicle)
In a twist of deja vu, SunCal is back to redeveloping the Oak Knoll project in the Oakland Hills — a 167-acre, former naval hospital site with the potential for more than 900 homes. Irvine-based SunCal has now bought the same site twice: once in 2005 for $100.5 million and again last week from the Lehman Brothers estate. SunCal declined to comment on the second sale price, but industry sources told me it was $76 million. SunCal originally partnered with Lehman to buy the site and turn it into housing, but those plans fell apart after Lehman declared bankruptcy in 2008 — a watershed event during one of the worst economic recessions in U.S. history. SunCal’s previous design for the site included 960 homes, 82,000 square feet of commercial and retail space, and 50 acres of parks and open space. After Lehman’s collapse, SunCal remained involved in the property, performing some maintenance and demolition of buildings, but since the property was partly owned by Lehman, it was tied up in bankruptcy proceedings and any new development stalled. (SF Biz Times)
The Palo Alto City Council is set Monday to consider approving development impact fees that would help pay for a public-safety building and other infrastructure. The fees, assessed for new developments, would bring in up to $27 million over 20 years, according to figures the city released Thursday. The city has been working to raise funds to build a new public-safety building, which will cost an estimated $57 million, and other projects. In March the council OK’d a fall ballot measure to increase the city’s hotel tax from 12 percent to 14 percent. (Palo Alto Daily News)
Sacramento City Unified School District trustees won’t be making any quick decisions on what to do with district-owned property at 16th and N streets in midtown. Instead, they’re scheduling a workshop to explore the process. Board president Patrick Kennedy said the public workshop, set for June 19, will consider disposing of surplus district property more in the abstract than in consideration of three development proposals put forward for the site. Kennedy said the workshop will cover the legal aspects and options the district has for surplus property of all kinds, including the parcel at 1619 N St., formerly an elementary school site but largely unused for decades. All three proposals received so far include housing and differ in other aspects; Hodgson Group’s proposal includes mixed-use retail, one from D&S Development would have a small hotel, and a Domus Development proposal has a Native American cultural center and events space as the centerpiece. However, Kennedy said he’s heard rumblings of other developers also looking at the site, one of the last undeveloped pieces in the heart of the 15th/16th corridor. “I would be surprised if there are only three proposals,” he said. Kennedy said it’s too soon to say when the district might make a decision on what it’ll exactly do with the property. (Sac Biz JournaL)
Downtown Roseville could be seeing a mini-building boom in the next few years, and not solely from new city buildings in the works. City manager Ray Kerridge said in addition to a new office building near city hall, a new parking garage near Roseville Theatre and relocation of a city library into an existing building, he’s expecting a proposal within a few weeks from Cordish Cos. on development of a downtown entertainment district. “We’re looking at something that could be managed comprehensively rather than one piece at a time,” Kerridge said after the Roseville 2014 event, where he gave 12 reasons why businesses should look at the city. “What we’re trying to do is not just greenfield development, which we do pretty well, but infill.” Conducive to seeing some of that infill development is the city’s plan to open up some of the creekside property near downtown. An existing fire station in that area is going to be moved, and the city recently acquired a former Placer County courthouse also along the creek. While the city is still talking with both Warwick University and California State University Sacramento about adding new campuses in or near the city, Kerridge said, those conversations are a bit more complicated because they also involve Placer County, with potential sites currently outside city borders. Within Roseville, though, Kerridge said the city is still pushing toward a university center, involving several higher education institutions, being established downtown along with the relocated library into what’s now a post office. (Sac Biz Journal)
With a new hotel and conference center on the way in about two years, city of Roseville officials are hoping a steady current of economic development they’re seeing in the city can expand and continue. An environmental impact report for the hotel and conference center near the Westfield Galleria at Roseville has begun circulating, and the Roseville City Council should see the project for final approval in August, said Mike Isom, a deputy city manager. Isom said based on market studies, the city already believes there will be plenty of potential rentals and visitors when the project is scheduled to be completed, by mid-2016. Already, hotels within the city are full on weekends because of youth sports events, he said. And the city isn’t concerned with timing suggesting the conference center/hotel will open near the same time as a new arena and hotel – along with other new development – in downtown Sacramento. Isom said south Placer County is considered its own separate market, and the two cities don’t go after the same visitors. City manager Ray Kerridge said the unusual financing the city is using for the project – with investors from South Africa— has the potential to be explored further if it works well. (Sac Biz Journal)
The new castle for the Sacramento Kings, and how it’s operated, will have a court adviser in all things environmentally sustainable, with the team announcing a partnership Thursday with the nonprofit Green Sports Alliance. Under the partnership, alliance experts will advise the team on how to be a more “green” franchise in a number of ways, from energy efficiency to use of water to waste disposal. Team officials have already said the new arena downtown will be as environmentally conscious as any building of its type, with such features as a heating and cooling system directed to specific seats rather than from one giant unit. Granger said over the course of a year, the new arena is expected to save enough energy to power a 200,000-square-foot office building. But there’s more the team will explore. Among the possibilities are installing meters to track ongoing energy usage and sustainability at the arena, putting low-flow plumbing fixtures throughout the project and looking at ways to re-use and recycle materials from the demolition of Downtown Plaza’s eastern end. The team will also be looking at the connection to ongoing operations once the arena opens in fall 2016, such as comfort of patrons and “farm to fork” local sourcing strategies in food and beverage concessions. It won’t be long before the team will be talking about what it’ll do, with a featured presentation at the 2014 Green Sports Alliance Summit in late July in Santa Clara, and release of a “greenprint” of environmental considerations for the arena itself at a later stage. (Sac Biz Journal)
Folsom’s big jump in growth across Highway 50 is nearing the takeoff point, with the City Council expected to adopt a development agreement next month with a passel of developers planning to build. With a price tag of more than $800 million and covering 3,600 acres on the freeway’s south side, the agreement spells out what the city expects from the future development and what will be allowed. “They’re looking for certainty in the future because they’re taking the up-front costs for putting the infrastructure in,” said David Miller, city of Folsom director of public works and community development. Beginning with more than 2,000 homes currently going through city processing, the city is expected to grow by 10,300 homes south of the freeway, though Miller said because the total plan area includes more retail than it will probably need, he expected the final residential development number to be closer to 11,000. Earlier this year, the city approved a public facilities financing district to directly address infrastructure, while the development agreement covers densities and housing types. As well, developers will set aside 30 acres for a city corporation yard and must build parks and trails to conform to city standards. The entire area will also have a Mello-Roos structure for paying for such improvements. “What they’ll have is actually better than what we have on the north side of the city,” Miller said. “North of 50, we couldn’t charge enough to completely build out the park system.” City Council adoption of the development agreement ordinance is expected to be official in July, and design work already has begun for sewer and water infrastructure, with the first actual on-site work likely to begin next spring. So far, The New Home Co., with 845 homes; Westland Properties, with 800 homes; and GenCorp, with about another 800, are likely to be the first to build structures, though that won’t happen until late 2016 or early the following year, Miller said. (Sac Biz Journal)
The California Public Employees’ Retirement System has begun a search for a new chief investment officer to replace Joseph Dear, who died in February of prostate cancer. Dear had taken medical leave in January, and already had given up some of his daily duties in June to Ted Eliopoulos, senior investment officer for real estate, while he underwent treatment. Eliopoulos will continue in that role until a permanent replacement is made. Sacramento-based CalPERS, in Tuesday’s announcement, said it “seeks an experienced investment professional for the role of chief investment officer to lead and manage its 400-plus person investment office.” CalPERS is the nation’s largest public pension fund, with $285 billion in assets “across a diversified global portfolio in public and private equity, fixed income, real estate and inflation-linked assets.” (Sac Biz Journal)
The owners of the famed Ponderosa Ranch want to make a public/private land swap with Washoe County that they say will enhance recreation on one of Lake Tahoe’s popular hiking trails. The move — labeled a “generous donation” by developers — has also drawn criticism from conservation groups and residents in Crystal Bay who say their rights to public lake access would be stripped in the process. Washoe County would get a 16.5-acre piece of private land currently owned by Ponderosa Ranch, according to the proposal. On that land is the historic Bull Wheel monument and an extension of the Flume Trail. In return, an 8-foot-wide strip of county-owned land and adjoining roadway stub in Crystal Bay would be deeded to Nevada Pacific Development Corporation. The strip — located between two private residences at 61 and 44 Somers Loop — extends from Somers Loop, roughly a quarter-mile south of Crystal Drive, down to the shore. Nevada Pacific Development Corporation owns both residences. Billionaire businessman David Duffield, founder of Workday and Peoplesoft, owns Ponderosa Ranch and is president of NPDC. Lake Tahoe land-use consultant company Midkiff and Associates and its principal planner, Gary D. Midkiff, are representing both companies through the process. (Sierra Sun)