February 4, 2008
The SocketSite Scoop: Francisco Street Reservoir On The Market
We’re still trying to nail down details (tipsters?), but the word on the street is that the City of San Francisco has decided to put the Francisco Street Reservoir up for sale and development. The completely unconfirmed price tag: up to
$70 $50 million.
A number of Russian Hill neighbors are obviously concerned with this turn of events and have organized a neighborhood meeting to be held this evening (2/4 at 6:30pm) at the Norwegian Seamen’s Church (corner of Hyde and Francisco).
UPDATE (2/5): From a plugged-in reader's comment below: "I attended the meeting. The property nearest Chestnut Street is privately owned. The proposed building(s) would cover the resevoir and potentially the park along Bay Street. I don't think a figure of $70 million was mentioned - the highest price was $50 million. Much depends upon whether someone is willing to buy the property without any existing ability to build anything - a huge risk."
First Published: February 4, 2008 5:12 PM
Comments from "Plugged In" Readers
Hallelujah !! I have been waiting for this complete eyesore to be bough sold and developed forever. I don't even care if the neighborhood association with too much time on their hands forces a 1 story height limit, anything is better than the swamp land that is there now.
Posted by: baywind at February 4, 2008 5:44 PM
Can't wait to see what gets built there.
All those old time SFcans who wants to impede progress... PLEASE MOVE TO ANTIOCH. That is where you belong. In the BURB, because you don't embrace density that is KEY to elevating the city's population and making the city a real rival to NYC.
Posted by: dotcomer at February 4, 2008 6:25 PM
Does anyone know if the land below the reservoir - the park that
runs along Bay Street - is part of the land to be developed? Or is it a separate park? If so, it would be a shame to lose a green space.
Posted by: jlasf at February 4, 2008 7:34 PM
Those properties on Chestnut are going to take a serious hit in value. They have amazing views and you can bet they will fight this any way they can, and I would imagine many of them are very well connected to City Hall.
Still, it would be very nice to see this eyesore finally gone and I hope somebody builds something nice and tall. Why not for one time a true luxury building, instead of all of the pretend luxury buildings going up everywhere? This neighborhood deserves a luxury tower with all the perks including a fancy lobby, deeded parking and even a clothes dryer that vents to the outside. (imagine!)
Posted by: anonandon at February 4, 2008 7:53 PM
This is too central not to put in a very high-density project. I would love to see some slender and tall towers here, with a low-rise bases, of course, and some open space for a tree or two.
Posted by: Timosha at February 4, 2008 8:21 PM
Didn't Steve McQueen drive down this in "Bullitt"?
Posted by: kennythegardener at February 4, 2008 9:06 PM
No way anything tall gets built here. Lot's of powerful people in the immediate radius.
I think they learned their lesson:
Posted by: eddy at February 4, 2008 9:25 PM
LOL, I love your comment, so true. Thos towers are so hideous.
You are completely right--there will be no high towers built there. Too much money in russian hill, and, not just money, very Old money, which buys you power in City Hall. The park is separate, and will not be built upon.
The city wants density, but this is a neighborhood, and is not SOMA/south beach or financial district. I would not expect anything more than 6 stories.
Posted by: buyerturnedrenter at February 4, 2008 9:45 PM
How can you say no more than 6 stories with a straight face? In that pic, I see FOUR towers within a ONE block radius. You are crazy !!!
Posted by: baywind at February 4, 2008 10:26 PM
The lot is also toward the bottom going downhill on a very steep slope, so there very well could be a tower here. A developer will probably only be able to afford to build a tower after he gets done with all the neighborhood bla bla bla lawsuits. Kind of a funny irony, I guess.
Posted by: baywind at February 4, 2008 10:28 PM
OK - for all of you who want a highrise anywhere there is a vacant plot in the city, there's something called zoning. Really, would you want 4 walls of skyscraper buildings surrounding where you live? I doubt it. Anyway, the vast majority of the city's residential neighborhoods have low development densities of one unit per 800 square feet of lot area (or less) and a 40 foot height limit. This is ridiculously more dense than the single family plots of Antioch by the way, but nowhere near as dense as the SOMA highrises. Generally when a public space is moved into the private development realm, the parcel inherits a mix of the surrounding adjacent zoning (unless it's a redevelopment area - which this isn't). So let's look at the zoning and height limits around the property. While there's often a lot more going on in the zoning, these maps are a good starting point:
Height (click on zoning maps/height and bulk district/Map HT02):
So, anyway, this parcel is mostly surrounded by RH1, RH2, and RH3 zonings which are typically low density house/duplex/triplex type zonings and then there's a bit of RM4 which is a higher density apartment zoning. The height limit in the majority of the surrounding area is 40-feet (with a couple of patches of 65-feet). Translation: this is going to be a low density 4-story development with large units unless the property gets significantly upzoned compared to the surrounding properties (which is unlikely given neighborhood activism).
Posted by: Miles at February 4, 2008 10:41 PM
Oh, won't THIS be fun to watch over the next ten years. At $70M for the land alone, could be tough to develop this in the zoned density and still make a profit, and no one will develop it without a profit incentive. There will be compromises somewhere.
Posted by: BernalDweller at February 4, 2008 11:12 PM
As stated in many previous posts, the cost of the land and the immediate zoning in the area (as well as the height and density requirements) will make it a very difficult sell.
Just looked up the tax record for the lot. APN 0047-001, 121,375 sf (2.78 acres). $25M/acre it seems.
Wonder if the park (0046-001) will be included in the sale as well?
Posted by: Serge at February 4, 2008 11:45 PM
I don't mean to be obnoxious, but for all of us who want a highrise anywhere there is a vacant plot in the city, there's something called re-zoning and this is a high-priced central location that calls for exactly that. There is a strong case for the notion that the free market should dictate density and development, but I can respect that, as you say not everybody wants 4 walls of skyscraper buildings surrounding where they live. On the other hand, that is a little too simplistic and sensational (4 walls!!!) here. What about one or two sleek high-rises? (After all, this neighborhood already has a few.) There are plenty of lovely low-to-mid-rise neighborhoods around the world dotted with high-rises. SF could very well stand to grow up!
Posted by: Timosha at February 5, 2008 12:27 AM
the nightmare that is Development will make this a protracted battle with some mediocre thing plopped down there 10 years from now.
that said, I do see like three 20 story towers right there! so I'm not sure more couldn't be put there.
Posted by: ex SF-er at February 5, 2008 4:54 AM
What are the chances that some of the units on Chestnut have view easements? That would certainly affect the height of any development.
Posted by: Drew at February 5, 2008 7:10 AM
bring on the highrise
Posted by: spencer at February 5, 2008 8:13 AM
Someone who is a real lawyer correct me if I am wrong, but I don't think there is such a thing as a "view easement", at least not in the classic sense that there is a filed property interest that is legally recognized.
Does California law recognize "view easements" as something that attaches to the property that would benefit from it were it available? Or, does California law recognize a real covenant regarding views that would run with the land (here, the resevoir land) and which would benefit the Chestnut Street properties?
Posted by: Satchel at February 5, 2008 8:24 AM
People need to keep in mind that the reason SF has restrictions on height is a result of the types of towers that were built above this plot in the 50's and 60's. I doubt if a highrise will ever be built on this site - and not because the dwellers of Russian Hill have so much political clout. I attended the meeting. The property nearest Chestnut Street is privately owned. The proposed building(s) would cover the resevoir and potentially the park along Bay Street. I don't think a figure of $70 million was mentioned - the highest price was $50 million. Much depends upon whether someone is willing to buy the property without any existing ability to build anything - a huge risk.
Posted by: Russian Hill Dweller at February 5, 2008 8:29 AM
The only time there would be a "view easement" would be if such an agreement were entered into by private parties (I've seen it, usually as a quid pro quo agreement - but it's rare). However, that's what zoning is for - people in a 40-foot high zoning area are guaranteed that no other building will be built higher than 40-feet without a variance. A variance requires a significant public review process and is usually pretty difficult to achieve - especially in a residential neighborhood with active neighborhood associations. The neighboring mid rise properties above the reservoir were built prior to the current zoning code revisions and are non-conforming uses as they are significantly higher than their 40-foot height limits. As the reservoir property does not have a zoning or height designation, it's going to be ironed out in a public process that is likely going to take years. I don't have a crystal ball, but a small portion of the site may get a 65-foot high height limit based on the higher density of the neighboring mid rises but I'd bet most of it is going to get a 40-foot height limit based on the predominant zoning in the surrounding low density residential neighborhood. Remember, the whole Van Ness corridor, the area at Van Ness/Market, and the South Financial/Rincon Hill area were all recently dramatically upzoned - these are mostly commercial areas - this property is not as central to public transportation and is surrounded by established and very pricing housing so it's a pretty different scenario.
Posted by: Miles at February 5, 2008 9:05 AM
How about the city tossing in the park too, but requiring that it be put on the roof of the new structure? That way the builder can go straight out level from the Chestnut side, block no views, add greenery to existing views, keep the open space (open space with a view, now), and still build up to 18 or 20 stories from Bay, all with plenty of parking underneath?
Posted by: James at February 5, 2008 11:46 AM
Rumor has it a 224,000SF Super Wal-Mart is is advanced negotiations to land lease the site.
Posted by: gh at February 5, 2008 1:30 PM
Rumor - Redevelopment agency is moving in. BC they are enlightened and have a proven record of enhancing SF.
As for the chorus call for SKYSCRAPERS, if City Planning weren't timid, lame, and still bowing to baggage of the no-growth of the past 30 years here-- and proper heights and densities were built in their right locations (Martet, Van Ness, Geary, other) we wouldn't be asking for tall buildings in a wrong &* ridiculous location as this. (And I crave a taller and more urban SF.)
This site should be restored to its street grid & be developed in a hill hugging, dense, 6-15 story, boldly modern complex which is inviting for the public as well as resident. Think Nouvel, Saitowitz. Skip the ersatz Monaco,Spanish, resist our suffocating Colonial Williamsburg Vic thing -- resist gated community, and no vines clad exteriors. Please no plywood smeared with stucco for the Calif. look!
The money and political clout which surrounds that property will help ensure nothing too inventive will be built.
Posted by: Invented at February 5, 2008 2:00 PM
Check out this view from the bay. I think the green patch in the middle is the property in question.
Looks like they can build 4 stories without blocking anyone's view. I don't know why so many commenters are excited about building a tower there. I think a mix of mid-rise will be most aesthetically pleasing for this site.
Posted by: Wai Yip Tung at February 5, 2008 2:38 PM
dammit, I was told there would be no math today. oh well, here goes:
development sites in SF typically sell for about $100K/unit (see AvalonBay’s recent purchase of Signature Properties’ site in Mission Bay). given that this is a once in a lifetime site (with a once in a lifetime price!), let’s say the units are worth $175K each. for $70M, they are assuming one can build roughly 400 units here. this is a lot of units to bring to market at once, so it may be more like two 200 unit projects.
now since the site appears to be roughly 121,000 sf (or 2.8 acres) according to sfgov. so, 400 units would equate to 140+ units per acre. assuming 1100 sf per unit gross (including hallways, mech, trash, etc.; this is slightly larger than average but this is a super-premium site), this means about 440,000 sf of building, or about a 3.6 FAR.
in order to achieve this kind of density, one would have to build roughly 7-8 stories across the site, or alternatively a couple thin 10-12 story towers and a 4 story base. in my humble opinion, this is a pretty reasonable density and buildout scenario given the surrounding uses.
but, everything depends on the architecture, so everyone cross your fingers and hope heller manus doesn’t get the contract and plop down one of their generic towers...
Posted by: green city at February 5, 2008 8:51 PM
sorry, just saw the update. but, this doesn't really affect the analysis above. think fewer units for a lower price on a smaller site BUT with the same FAR. still end up with the same HEIGHT building (but not over all sf or unit count).
Posted by: green city at February 5, 2008 8:53 PM
Sorry, this site is going to sell for WAY more than $100-$175K per unit. The land value of high rise sites gets discounted due to the large number of units and the increased cost of high rise construction over low rise/wood frame construction. Low density development sites in San Francisco routinely sell for $300-$400K per unit for lower density condo properties in average locations, so this one will be well above that due to its exceptional location. The value of high rise land is not really an apples to apples comparison to this property. Furthermore, the average size of a high rise unit is going to be 1,000 to 1,500 square feet while these lower density sites have much larger units. Believe me, a four story property will pencil out just fine in this location even with a very high land value. If you want to do some guestimate math as to the land value, I'd estimate a density of one unit per 800 SF of site area which would yield 151 units. 15% or 23 of these units are going to be low income units, so that leaves 128 market rate units. $50 million equals $390K per market rate unit whereas $70 million equals $547K per market rate unit. I'm guessing it's going to be closer to $70 million if they allow that many units. Then again, the crux of this issue is how many units they let be built on the site. Sometimes land purchase contracts are written to allow different prices depending on how many units are eventually approved - maybe that'll be the case with this property.
Posted by: Miles at February 5, 2008 11:05 PM
^^ Developed much midrise or highrise product when you bought it at $547K/unit, un-entitled in one of the most political cities in the US? I'm guessing not, since you'd be bankrupt. That is at least twice market value. Kind of like the guys at Hines, who are kicking themselves wondering why in the hell did they bid twice what their competitors did for the same piece of dirt at transbay.
I appreciate that you are actually running the numbers rather than simply throwing out a WAG, but those are very, very high numbers. I will be very interested to see what ends up happenning and seeing it on SocketSite (I hope!) so that we can all come back and review in a few months. And then in a few years when it gets entitled. And then a few years after that when it gets built...
Posted by: green city at February 6, 2008 12:14 AM
No offense Green City, but maybe I do have more than a layman's knowledge of large luxury developments like this. Remember this isn't your run of the mill development property - these units are going to have some amazing views in one of the best locations in the city so the final product is going to sell for top of the market prices. That translates into a higher than typical land price. But hey, I'll take the Pepsi challenge - how about we wager a nice bottle of wine on this, it being San Francisco and all. I'll take a value per unit half way between the the numbers I quoted, or $470K per unit, and you take half that number, or $235K per unit and the person closest to the selling price per unit wins. And to keep our assumptions similar, let's assume the final density of the project is going to be fairly low in the range of one unit per 800 to 2,500 square feet of the total site (because if by some weird twist this gets zoned for high density housing, I agree that your number is going to be more accurate). Socketsite.com has an email address where I can be contacted to settle up when the time comes. I have a feeling that the city is going to want to maximize its selling price here so that means they are probably going to give the buyer some good guidance about what they can build on it, so I bet we'll get an answer to this sooner rather than later.
Posted by: Miles at February 6, 2008 1:12 AM
Why does one developer have to build on this site? Couldn't they just extend Francisco Street from the opposite side of Hyde? They could then subdivide and sell maybe 30 lots for $1.5 million each, giving the City $45 million. (When Nicolas Cage bought 898 Francisco for $9.4 million, he sold the extra lot and now the house is on the market for $7.7 million, thus making the lot worth approx. $1.7 million.) Let people build 2 rows of very expensive homes, as there are on the existing block of Francisco, where there are 20 lots. Or, perhaps, develop it as a low-rise complex, like Telegraph Terrace on Francisco on Telegraph Hill. Yeah, yeah...I know what people here will say: too elite. But it wouldn't block anyone's view and would be more consistent with the neighborhood than another Fontana monstrosity.
Posted by: jlasf at February 6, 2008 6:25 AM
Let's not forget the tourists. This space is the only clear view shot of the GG Bridge from the cable cars. Gavin and the PUC will have to explain why he is taking away millions of photographs that capture one of SF's jewels in favor of $$$.
Posted by: rh27 at February 6, 2008 6:25 AM
miles - don't worry, no offense taken (or meant either). it is actually great to see real comments backed up by reasonable assumptions.
let's call it a friendly bet (wouldn't want to break the old anonymity of the internets now, plus it will be months or years until we know the answer). I think our difference of opinion actually stems most from what will end up getting built. if it is a higher density higher cost project with smaller units and a couple of slender midrise towers (about 1 unit/400 sf, as I think), it will probably end up closer to my number. if lower density, larger more premium units but with lower construction costs (1 unit/800-2500 sf, as you noted), I agree it will more likely be closer to your number.
as such an amazing site, i am very interested to see how it ends up.
Posted by: green city at February 6, 2008 9:17 AM
Green City - a friendly bet it is then. One thing that may tip the whole value thing that I didn't even think of though is the extent of the needed site prep - I don't really know what is under there - how deep is that reservoir? Are they going to have to fill it to make this a usable site? If the site costs are huge that would throw off the numbers. Anyway, agreed - great property - it will be very interesting to see how it turns out.
Posted by: Miles at February 6, 2008 10:25 AM
Not that my vote matters, but I vote for developing this as a public park. We need more green space in our city. Density is good, but we gotta have green space too, and, have ya heard, they're not building any more of it. Go dense on existing built lots. Leave the green.
Posted by: Matt // Le Blog Exuberance at February 6, 2008 4:37 PM
Go dense on existing built lots.
This is a built lot. It has a very large structure on it - a concrete bottomed, sided, and topped resevoir.
Posted by: Matt checker at February 6, 2008 5:16 PM
Matt - you're a prime example of someone who should move to Antioch. Get out of my CITY!
"We need more green space!"
"More space with green stuff in it!"
"More dead grass space!"
"More comfortable surfaces for the homeless to sleep on space!"
Enough with it already. You moved to a C-I-T-Y. Deal with it!
Have any of you environmentalists ever even visited the existing green space here??? I bet not. You know why? Because it's a disgusting space trapped between a concrete reservoir and a heavily trafficked Bay Street. See that little dirt path in the photo? Your walk in the park can take about 23 seconds. Yippee! They could build the greenest green space imaginable on this site and I would still walk past it and 2 more blocks to be along the water. Or I'd do what I do now - turn left and walk to Fort Mason Park instead. My point - there was a time and place to "develop" parks. It was about 100 years ago. We got Golden Gate Park, some waterfront, and nice big parks like Dolores and the Marina Green. Go THERE and stop your constant wining. Frederick Law Olmsted is dead.
Can't wait for that Super Wal-Mart. They have great roasted chickens for half the price of Safeway.
Posted by: rg at February 7, 2008 6:22 AM
Sheesh, somebody has had some strong coffee this morning! I have to agree though, that the last thing we need is another weed patch that becomes a creepy camp for people who would make it dangerous to walk through the so-called park. Let's let San Francisco be a city, and not Carmel or Point Reyes.
Posted by: anonandon at February 7, 2008 7:46 AM
Posted by: SocketSite at May 7, 2012 10:01 AM
The goal of the Working Group is to demonstrate to the PUC and City officials that the entire site can be converted to open space uses for all San Francisco residents and visitors alike, and be affordable without any need for private development. The property belongs to the public and therefore the first objective should be to try and make it all available to them. We welcome the support of everyone in realizing this effort.
Posted by: Working Group at May 8, 2012 10:04 AM
SF will never rival, match or come close to NYC. Anyone who thinks SF should, does not know her at all.
Posted by: philip themholes at October 8, 2012 2:32 PM
@WorkingGroup - I have no particular desire for a park at that location, and as a city resident would MUCH prefer tax-producing buildings, which can either reduce the amount of taxes that I need to pay or increase the overall pot of taxes, allowing more services in other areas. This is a ludicrous place for a park, and the citizens of SF know that.
Posted by: anon at October 8, 2012 3:09 PM