May 28, 2009

The 690 Stanyan Project Scoop: Scaled Back To An Interior Gutting

690 Stanyan Site (www.SocketSite.com)

A plugged-in reader reports on the proposed 690 Stanyan Project:

The other half had a storewide meeting at Whole Foods last night. It was told to them that the Stanyan Project has been scaled back to be just like the Noe Valley project. No external construction - no condos, just a interior gutting of the old Cala foods and a small format Whole Foods going into it.

The mixed-use design as was proposed (and conditional use approved):

690 Stanyan Project: Revised Design

The 26 studio units, 20 one-bedroom units, 15 two-bedroom units, and one three-bedroom unit have been removed from our pipeline inventory watch list.

UPDATE: Confirmation this afternoon from the Business Times with regard to the project:

The developer of a Whole Foods and housing development approved for a vacant lot at Haight and Stanyon streets has decided to shelve the project, citing high city fees [of between $5 million and $6 million] and the economic downturn.

According to the developer, however, an agreement with Whole Foods on the scaled back plan has not been reached (but is being discussed).

The 690 Stanyan Project Update: Conditional Use Approved 6-0 [SocketSite]
The 690 Stanyan Project: Overview And EIR Hearing Tomorrow (2/28) [SocketSite]
Whole Foods Green-Lighted In Noe (And As Proposed On Market) [SocketSite]
Developer scraps S.F. Whole Foods project because of city fees [Business Times]

First Published: May 28, 2009 9:00 AM

Comments from "Plugged In" Readers

no surprise. they can spend a few bucks now to make a decent store, and consider a grander scheme in the future.

A shame, because at such a prominent location at the entrance to the park, it would be really great to have something with a little more presence. With the McD on one side and the grocery store parking lot on the other, it's just pathetic. But at least we can assume the facade and parking lot will be spruced up a bit.

Posted by: curmudgeon at May 28, 2009 9:28 AM

The only additional info I was able to glean was the store will be in the 17k sq feet size and the focus will be prepared foods.

Other half HATES these quarterly all-hands meetings, especially on his day off. Interestingly enough Team Members skipping these meetings is one of the easier ways to get fired at WFM.

Posted by: Eric in SF at May 28, 2009 9:57 AM

Whole Foods should pull out and not support absurd planning. Or join the company of your neighbor with poor land use as displayed by McD's block-long parking lot. If true, this is -- unbecoming.

Posted by: invented at May 28, 2009 10:06 AM

Disappointing but not surprising.

I just walked by that store and it is so out of place for the nabe. Clearly building condos is a losing proposition right now, but it's still too bad they couldn't tear this building down and build another one that goes up to the street, with parking in the back.

that said, at least it's "green" to simply renovate! I hope it looks nice when done.

Posted by: ex SF-er at May 28, 2009 10:31 AM

I don't understand what you're talking about, invented. It sounds like it is clearly just an economic decision. Who in their right mind would build condos right now?

Posted by: curmudgeon at May 28, 2009 10:31 AM

^ Curmudgeon, I don't see how they can 'consider a grander scheme' in the future. They will invest money to redesign this space, and have a very active store. To do the original plan they will need to shut the store down, gut, and start from scratch. Probably as 18-24 month projects (assuming no plannind/dbi issues). And they will inconvenience/possibly loose customers in that time.

I'm assuming this bldg owner/developer does not have deep enough pockets to do the full blown construction, rent the units out, and wait for the resale market to turn around. With an anchor tenant such as WF, they may possibly break even/cash flow the project for the next few years.

Or, maybe they could not align the construction loan. If their finances are stretched, or they have too many other projects in the pipeline. But this is a pretty highly visible project, so something must be going on for them to give up such prime entitlements. Anybody with the inside scoop on the developers ??

It's really a shame to not have more presence in that area, and the [cafe] they planned could have been cool too. Once they redo this low rise bore, that's all that will be there for a long, long time :(

Posted by: 45yo hipster at May 28, 2009 10:47 AM

while in an abstract sense, it's more "green" (i.e. resource efficient) to renovate rather than demolish and build anew, that is only true if you're talking about replacing a structure with another of generally the same size and scale. So, yes, it's better to re-use the same Cala shell than to tear it down and build a new one-story supermarket. But the context of re-using an existing one-story shell+surface parking lot versus tearing it down and building a 4-story store plus housing above and parking below, it's no competition. Tearing down is far greener hands down. (And many materials from the demo can be recycled into the new project or other endeavours anyway).

In that bigger picture, I would MUCH rather the existing piece of crap sit there for another 5+ years than to pour money into rehabbing a suburban store that is an awful use land. Rehabbing the existing store will result in an additional at least 15 years of that site not getting redeveloped with a more intense and better usage and perpetuating that god-awful parking lot. It means we're going to be at least two economic cycles away from that site getting re-developed. I say this as a very close neighbor of this blighted and awful piece of property.

As a side note: as much as the pushy and bullish property owners/developers would never admit it in a million years, they're thanking their sweet stars that the neighborhood actually dragged out the entitlements by an extra little bit so that they didn't actually build those condos, as the property owner would be crying in his beer over the millions lost from plummeting condo prices once they actually came to market.

Posted by: realist at May 28, 2009 10:51 AM

If this is true, at least there will be a grocery store for the neighborhood. I think the developer was planning to rent the units, they do so elsewhere. The delays from the opposition hurt because they could have the building nearly complete by now, that is a shame.

Posted by: J. Larson at May 28, 2009 11:12 AM

Yes! All I really cared about was getting the Whole Foods, so I'm happy as a 'hood owner.

Posted by: medated at May 28, 2009 11:18 AM

45yo:

This is a shuttered building with no active business except for a sketchy parking lot out front.

Posted by: DavidQ at May 28, 2009 11:18 AM

I say revoke their approval if they change the project. It may be a losing prop to develop condos now - but its shortsighted.

Posted by: Joe at May 28, 2009 11:31 AM

Joe - I'm pretty sure that's what will happen.

They will have to re-permit the new design but since it's not changing the use of the site (formerly grocery, proposed grocery) and not changing the external footprint there will be a lot fewer permits needed.

I think the only conditional use permit is a chain store permit. (I'm not sure if that stretch of Haight is covered by the chain CUP rules.)

Posted by: Eric in SF at May 28, 2009 11:51 AM

Totally dumb question I'm sure, but - what exactly is "the other half"? I feel like I'm missing out on some sort of inside joke/terminology...

Posted by: The Drizzler at May 28, 2009 12:06 PM

"The Other Half" is one of the many terms for one's spouse. Others include lover, boyfriend, husband, life partner, ball and chain, etc. etc. =)

Posted by: Eric in SF at May 28, 2009 12:09 PM

This will be a suburban style store for at least 25 more years now.

Something others haven't mentioned that will delay future redevelopment - the neighborhood now has chance to say "This site doesn't need to have construction going on. No new housing is needed. Look how packed and busy that store is! It would be picking on the entire neighborhood to close down a store for a few years, turning the area into a grocery desert when there is no need to do so."

The permitting process to turn down something in use is only about a billion times harder than it is for a decrepit and unused lot, so unless Whole Foods plans to close for a couple years, go through the permitting process (2 years minimum), then a year and a half of construction, this will be a Whole Foods in its current state until 2035 at least.

Posted by: Brutus at May 28, 2009 12:31 PM

What a waste of Real Estate! Can the city reject the scaled back proposal?

Posted by: Poor in PacHeights at May 28, 2009 1:08 PM

Well, at least now there's a chance to redevelop the entire seedy block, not just the endcap.

Don't get me wrong--the metal record store is fine, as is the dialysis center or whatever that is -- but there are lots of commercial spaces on nearby off-streets they could go to. The whole block is a waste of commercial space, and it has parking lots on both ends.

Posted by: theo at May 28, 2009 1:32 PM

Amoeba Records is one to the busiest record stores anywhere, and totally appropriate for Haight Street-- not at all a waste of commercial space.

Would be great if the end of Haight Street weren't a McDonald's and a parking lot, though.

Posted by: Dan at May 28, 2009 2:15 PM

UPDATE: Confirmation this afternoon from the Business Times with regard to the project:

The developer of a Whole Foods and housing development approved for a vacant lot at Haight and Stanyon streets has decided to shelve the project, citing high city fees [of between $5 million and $6 million] and the economic downturn.

According to the developer, however, an agreement with Whole Foods on the scaled back plan has not been reached (but is being discussed).

Posted by: SocketSite at May 28, 2009 2:48 PM

$5m-$6m in city fees up front required to play. What a joke.

Posted by: lolcat_94123 at May 28, 2009 6:27 PM

It's a shame that something can't be done to this eyesore lot. That area does have great potential. But Haight St. just sort of fizzles out when you approach the park.... Instead of being energetic like everywhere else along Haight, what should be the most exciting part of Haight is dead.

As far as going ahead and developing it now with housing, even if it is shortsighted.... Try finding a bank that will finance a project that won't break even for a few years...

Posted by: StockBoySF at May 28, 2009 6:36 PM

$6M fees don't seem out of place for a 62-unit building; assuming the commercial space takes half the hit that's $50K per new unit.

The acquisition cost is a sunk cost and is neither here nor there WRT the business plan.

Of course, if we had a brain in our collective heads we wouldn't tax new construction but zoned land value, which would . . . encourage . . . the market to build up to the zoning limits. It's ironic that the city that Henry George first formulated his arguments is still so screwed up 120+ years later.

Posted by: Troy at May 28, 2009 7:42 PM

JP Brennan could fund building the second tower on Rincon Hill himself. They guy already owns half of Haight street (I'm not kidding, and if I'm off on the amount it is not by much.)

He is not building because as he enters his 80s, this project will not be profitable for 10+ years. Who in their right mind needs that headache when you can rent out the same space to the same retailer for the same money without taking a dime out of your pocket.

Much like property values overshooting the proper market level, so do city fees. I mean let's face it, if a guy can't build on a piece of property he has owned for 20 years, with money he doesn't need to borrow, in a neighborhood he'll be able to rent out immediately, then the last out of whack factor is fees.

Posted by: jtothed at May 28, 2009 10:11 PM

This is strictly an economic decision which the developer has the right to make. He owns the land.

The process in our City to get a project approved is devastating even on the perfect urban land infill sight such as this. Doesn't get much greener that building high density housing with a neighborhood serving business like a grocery store. The fees and bmr requirements have made projects losers. Not to mention the years of planning and neighborhood resistance to even get it entitled. The inmates are running the asylum and this is the result. At some point when all the money is gone things will change. We may be getting close.

Posted by: city developer at May 28, 2009 10:46 PM

Sounds like negotioations are still going on with WHole Foods. I'd place a big bet that Whole Foods pulls out of this deal. Look at the surroundings? They'd need to 24/7 security, Parking, etc. It's too bad since I was really looking forward to something changing in this hood. I live 3 blocks away and it's an eye sore.

This remains an abandoned building (Free Housing for the bums) for the next 5 years.

Posted by: Mike at May 29, 2009 8:37 AM

If I were Mr. Brennan I would just let that piece of crap sit there and decay. Maybe then the people of the neighborhood (I have lived in the neighborhood 10 years) will realize that fossils like Calvin Welch don't know what the best interest of the neighborhood actually is. The Brennans dont need the money, the parents or the children. The neighborhood groups have screwed with them so many times (granted, i definitely didnt want an urban outfitters on haight st) that I would just let it sit and rot into an even bigger eyesore.

Posted by: AdamF at May 29, 2009 9:18 AM

Its not just Haight Steet - looks like there will be no Trader Joe's on Van Ness either. The entire Planning Dept should be fired.

Posted by: J. Larson at May 29, 2009 9:38 AM

seems like almost everyone posting on this site lives in a fantasyland. All construction has halted everywhere in the United States -- all across the spectrum everywhere -- becuase lenders aren't lending. It has nothing to do with fees. Has the SF bureaucracy stopped housing construction in Boston, New York and Chicago? you people are insane. the fees required in SF are right on par with development fees for new housing in countless places throughout this state and others. in fact, the fees for development on haight street are exceptionally low (or nonexistant) as compared to other areas of the city -- downtown, soma, hayes valley, and even freakin' Balboa Park/ocean avenue. Even Ocean Ave has higher development fees than the Haight. But Avalon Bay is actually going to break ground in the next year on a new 200-unit project with grocery store on Ocean Avenue. Why? Because they have deep pockets and are self-financing, and because it's a rental project. Brennan is just a beligerent old crank looking for a quick buck and apparently, can easily stir up up the armchair critics by telling tall tales.

Posted by: realist at May 29, 2009 10:02 AM

I could see them taking the following strategy: WF will pay for all/most of the interior renovations. That cap expense will be reflected (ie discounted) in their lease. Set the lease for x number of years. When lease expires, and market condition return, owner has the option to resubmit original project for development. If green lighted, WF shuts down, development ensues, and WF is guaranteed a new lease in the new long term property. That would give the developer future flexibility, and if WF funds the initial interior improvements, WF would expect favorable lease terms for existing store and the potential future store. This is probably the most logical avenue to pursue, given the circumstances. Hope it works out for them.

Posted by: 45yo hipster at May 29, 2009 10:05 AM

The EIR process took nearly 2 years. Those are fees the developer will never recover. By the way, these were going to be rentals. There are defintite fees in the City (for all projects) to say otherwise is naive.

Posted by: J. Larson at May 29, 2009 1:02 PM

Mike - then why did Whole Foods tell 300+ employees that there *will* be a store on Haight and it will be 17k sq ft?

I agree that negotiations are most likely underway but I fail to see why WFM would go so public before signing if they weren't confident an agreement was forthcoming.

Posted by: Eric in SF at May 29, 2009 2:02 PM

Team,

Projects are being financed, the world is not over. The real issue is what many others have been saying. The City and County of San Francisco is broken. District elections and nimbyism is destroying our systems. Yes, many did not like Willie Brown because he got things through the process no matter what, so now nothing gets through the process.

We have to all realize that no one is entitled and we all have to work, make compromises for our City and community to work, same as in a relationship. But it seems that when it comes to city policy it all for one and none for all.

Lastly, why can the supervisors decide to redo the whole cost structure for fees, parking rule and many other rules after a plan like Market Octavia is approved through the planning commision and after years of study by professionals? Because the supervisors think that they can continue to extract fees and monies to make their constituency happy that day to the detriment of all.

Ok, sorry for my sermon.

Have a nice weekend and lets get rid of district elections and reduce the pay of the supes.

Chris

Posted by: Chris at May 29, 2009 2:45 PM

@chris -
what the heck are you talking about? haight/stanyan is nowhere near the Market/Octavia plan area. and the supervisors have not changed nor proposed to change any core aspect of market octavia since its adoption, including fees or parking or whatever.
further, no additional fees have been proposed for the haight/stanyan project than the baseline fees that apply generally citywide. the fees the developers are whining about are general inclusionary housing requirements and basic applications fees and permit fees. nothing additional has been asked of this project.

Posted by: huh at May 29, 2009 4:40 PM

The permitting process took so long because Brennan would not back down from his insistence on building the project so big big big! AND including almost 200 parking spaces in the mix, almost 5 times as many as that butt-ugly surface parking lot out front has now. Someone please remind me what exactly was so "green" about this plan?

If Brennan hadn't been so arrogant and had kept the number of parking spaces down to 134, or a mere THREE times as many as the existing lot, the city would not have even required an EIR and the process would be done by now. It was his hubristic and stubborn insistence on cramming in those extra parking spots that doomed the whole project. Now instead of learning from his experience and becoming a more reasonable and considerate person as a result of it, he is blaming it on the city. And all of you who buy into this are just reinforcing that kind of dysfunctional behavior.

I would rather have 42 ugly surface parking spaces than 181 ugly hidden ones. Since I live only a few blocks away from the site and don't drive, I very much doubt I will ever be using one of those parking spaces anyway. I would much rather be able to cross Haight Street on foot without worrying about being run down by one of the 7000+ car trips a day this new project would generate.

As far as what to do with the ugly surface lot, try this:

http://www.parkingday.org/

There is hope for that ugly site yet (and the one across the street as well, and the one at the corner of Shrader, and, and....)., you just have to look far enough into the future to find it.

Plus, don't forget the CEO of Whole Foods just came out against public health care, and admitted that WF "sells a lotta junk". We should be boycotting those suckers anyway.

Posted by: Katherine Roberts at August 19, 2009 9:16 PM

"Since I live only a few blocks away from the site and don't drive, I very much doubt I will ever be using one of those parking spaces anyway."

- Yep, San Francisco NIMBYism at it's finest.

Posted by: Fishchum at August 20, 2009 8:33 AM

The usual mindless "NIMBY" namecalling, I see, when something's in somebody else's backyard. (The usual inability to punctuate the word "its", as well.) As if you'd be so happy to have 7000 more cars to contend with.

Face it, we are well past the point where "making room" for more cars does any good. This is at the edge of the densest half of the second-densest city in the U.S., and it makes no sense to add 7000 car trips per day there. We voted twice for transit and pedestrian priority; time to actually stick with what we mandated.

Posted by: Veat at August 20, 2009 9:27 AM

Thanks for the background Katherine. I didn't realize that the process was stalled over a 47 parking spaces.

This project would have been a success with or without the extra parking spaces. It looks like greed could have been a factor here. The developer knows the ... um ... "street value" of a parking space is about $250/spot, making parking one of the most profitable ways to lease real estate. Think of it : almost zero maintenance costs, you can pack a lot of them into a fixed space, and the demand seems to be rising which will drive the value higher.

But the costs are not just the RE and development costs to build the parking structure. The higher concentration of parking results in more auto trips and more congestion on the surrounding streets. The current users of streets will be part of those involuntarily "paying" for the new parking spaces. Did anyone ask them ? I guess so, via the EIR.

I'm glad that the city has gotten wise to developers appropriating assets from the commons (i.e. the city's already congested streets) and then privatizing the revenue.

Redevelop this site. Build a passel of fantastic condos and bring some ground floor retail to this deserted stub of Haight. It will be a grand success without a suburban parking ratio.

Posted by: The Milkshake of Despair at August 20, 2009 10:03 AM

Thanks for the punctuation lesson, Grammar Nazi. I stand by my statement regarding Katherine's post. If she had left out the statement I quoted, I wouldn't have called her out on it. But that line smacks of "since it's not going to benefit me, I'm against it".

Never mind that the proposal was an improvement over the current empty lot.

Posted by: Fishchum at August 20, 2009 10:06 AM

Fischum, while I see your point, I actually agree with Katherine on the reason for this project dying. Just as it'sridiculous for NIMBYs to block projects that fall within height limits and such, it's ridiculous for developers to think that they can circumvent parking limits. Had he not been looking for a parking variance, this project wouldn't have been scrutinized nearly as closely.

Posted by: anon at August 20, 2009 10:34 AM

Anon - I kind of agree with Katherine as well. I'd like to see this project move forward with less parking. But when you end an argument with a "well, I wouldn't use it so I'm against it" mentality, it really reeks of selfishness and NIMBYism.

Had she said something more along the lines of "I feel this is what's best for the community and here's why" or "wouldn't this policy better suit the neighborhood" I'd be more inclined to agree.

Posted by: Fishchum at August 20, 2009 11:15 AM

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