October 4, 2013

A Grand Jury's Call To Optimize San Francisco's City-Owned Real Estate

170%20Fell%20Street.jpg

The City and County of San Francisco owns 6,000 acres, or 20 percent of the land, within its County limits and another 92,000 acres beyond.

Concerned that surplus and underutilized real estate owned by San Francisco's City and County agencies could be put to better use ("providing for housing or commercial, cultural, and/or civic activities") and increase the City’s tax base, a Civil Grand Jury has come to the following six findings and recommendations for the City, including putting 170 Fell Street (pictured above) and its adjacent complex of historic buildings to a more productive use post-haste:

Finding 1:
Inadequate readily-accessible public information on publicly-owned real estate is part of the reason some properties have been allowed to languish and deteriorate, at a loss to the City. A more rational approach to handling under-utilized or surplus property requires that a comprehensive, detailed list of public properties is available on an ongoing basis.

The Fleishhacker Pool House is a perfect example of a situation where being “out of sight, out of mind” allowed a property to become so neglected that it eventually was destroyed by fire, resulting in a real loss for the City. A more transparent property database will make such occurrences less likely in future.

Recommendation 1.1:
The web-based San Francisco Property Information Map currently used to display
Planning and Building Inspection Department information should be integrated with and further developed by other departments to convey complete information about City properties. The Department of Technology and the Planning Department should work with and provide database access to all City departments enabling them to maintain the information on their properties.

Recommendation 1.2:
The online database of all properties owned by SFUSD and all City departments, including revenue-generating enterprise departments, needs to include information required by Chapter 23A of the Administrative Code [San Francisco’s Surplus City Property Ordinance].

Recommendation 1.3:
City departments, commissions and agencies should be directed to maintain and update their departmental real estate database, which appears in the Real Estate Division Map of Real Property and Property Book.

Recommendation 1.4:
The Director of Real Estate should be required to review the list annually to confirm that all departments have made a complete report on their properties, including surplus and underutilized properties, in accordance with the requirements of Chapter 23A of the Administrative Code; and the City Administrator should be required to report annually to the Board of Supervisors regarding the City’s real property assets.

Finding 2:
Lack of transparent public debate contributes to suboptimal use of City real estate assets.

The Kirkland Property is a perfect case in point. SFMTA may have a good case for retaining the property as a bus maintenance yard as recommended by its consultant. However, allowing SFMTA to abandon stated plans for converting the property to commercial and/or residential use without public debate prevents possibly better, more economically efficient alternatives from being considered.

Recommendation 2:
The City and SFUSD should activate their respective Surplus Property Advisory Committees because the meetings of these committees provide a public forum in which to discuss best uses of publicly-owned real estate and each committee should be charged with monitoring uses of public property and making sure that there is ongoing accountability with respect to surplus and underutilized properties.

Finding 3:
The purposes for which the Surplus Property Ordinance was adopted are too narrow to effectively motivate City departments to identify surplus and underutilized properties for other uses or disposition. Further, the ordinance does not provide a department with any incentive to dispose of surplus or underutilized property.

Recommendation 3:
The Board of Supervisors should amend Chapter 23A of the Administrative Code to include an incentive for City Departments to identify and dispose of surplus and underutilized properties and to broaden the purposes for which surplus and underutilized properties may be used.

Finding 4:
Current practice allows City Departments and SFUSD to keep property on their surplus list indefinitely without any consequence. The concern for a more rational approach to handling under-utilized or surplus property requires that a time limit be imposed on how long property may remain on these lists. If, after a pre-determined period, property which is identified as surplus or underutilized has not been put into use or fully-utilized or no plans have been adopted for its use or full-utilization, there should be specified consequences for the failure to act.

Recommendation 4:
The Board of Supervisors and the SF Board of Education should each adopt rules which limit the length of time property may remain on their respective surplus list without action and which address consequences for such inaction.

Finding 5:
Passive management of publicly-owned real estate leads to valuable properties lying fallow for years. The City and SFUSD leadership must be charged and empowered to develop plans for utilization of surplus / under-utilized parcels, including public-private partnerships where feasible and desirable.

Very valuable properties owned by City departments and SFUSD have been underutilized for decades and present prime opportunities to be repurposed or sold to create value for the City and SFUSD. The properties at 155/165 Grove Street, the Fire Chief’s House at 870 Bush Street, the lot at 7th Avenue and Lawton Street, and 1950 Mission Street are a few examples of properties that have been passively managed.

Recommendation 5.1:
The SFUSD needs to designate someone who is given appropriate authority and whose time and energy is devoted to optimizing the use of surplus and under-utilized real estate through its development or disposition. That person should work with the Capital Planning Policy Committee and Surplus Property Advisory Committee to incorporate surplus and underutilized property into SFUSD’s 10-year rolling Capital Plan.

Recommendation 5.2:
The Capital Planning Policy Committee of the San Francisco Capital Planning Program should be made responsible for overseeing the publicly-owned surplus and underutilized property list for the City and for assuring that clear plans for the disposition or repurposing of such properties are generated and incorporated into the 10-year rolling capital plan of the Capital Planning Program.

Finding 6:
Given the location of 135 Van Ness Avenue and 170 Fell Street in the heart of the City’s cultural center, and the historic nature of the structures, their current status is far from the highest and best use of these unique properties. Plans by SFUSD to convert the properties into the School of the Arts have not moved forward because of, among other reasons, a lack of needed funding. Yet, at the time, and now, SFUSD owned and continues to own, sufficient surplus and underutilized property that if sold could fund the entire project.

Other alternative and better uses of this complex may be possible.

Recommendation 6:
The entire complex of historic buildings at 135 Van Ness / 170 Fell Street, including Nourse Auditorium, should be put to productive use by, for example, converting the complex into the School for the Arts.

The Civil Grand Jury's full report: Optimizing the Use of Publicly-Owned Real Estate.

First Published: October 4, 2013 12:00 AM

Comments from "Plugged In" Readers

Having lived 1 block from 135 Van Ness and 170 Fell for 2 years and driving/walking past it daily, I have always wondered why it sits idle. I think it is one of the most historically avant (and unfortunately neglected) buildings in the city.

While I agree, that it would make a great complex for an Arts School, I have always envisioned buying the property (wishful thinking) and turning it into the city's grandest hotel (it has Ian Schrager written all over it--similar to what he did with the Gramercy Park Hotel in NYC and the Ambassador in Chicago).

It has the makings of being an amazing hotel with its spacious courtyard and could serve as housing for art students (dedicate a portion as student housing) and visitors to the Civic Center area (which is in need for a hotel that complements the growing Hayes Valley area).

Regardless, of what it becomes, I simply hope it is preserved and revitalized as this epic building needs some love.

Posted by: sfstyle at October 4, 2013 12:19 AM

Wow, I had no idea that so many of the city's odd little sections of blight were due to the simple fact that the government forgot it owned them.

Posted by: anon at October 4, 2013 8:02 AM

simple solution: put them on the market and sell them.

Posted by: PatBurns at October 4, 2013 8:11 AM

It's criminal that those buildings in Hayes Valley have been allowed to languish and deteriorate for almost 25 years now - a poster child for the incompetence of SFUSD and the "City Family" in general. I, like sfstyle(lacking the personal resources as well) have fantasized for years about developing that block into something vibrant and useful - tying VanNess to Hayes Valley. There are so many politically-connected developers in town with a real ablity to pull strings by greasing the right palms that I can't understand why nothing has been done with this.

Posted by: steve at October 4, 2013 9:11 AM

I find it hypocritical that the city can fine property owners for allowing their properties to become blight yet the city actively owns several blighted properties and lets them languish without consequence.

Posted by: S at October 4, 2013 10:21 AM

It seems to me that city holds properties for years, and occasionally hands them over to organizations or wealthy individuals as part of a sweet deal in exchange for political favors that help the politicians and government executives in charge.

Posted by: cliff at October 4, 2013 10:39 AM

sfstyle, the answer to this specific building is seismic safety. The Nourse theater was just renovated for public use but that takes a lot of money and the rest of the building is still inadequate. In fact, if you go to the corner shown in this photo, you can see bricks actually separated from the wall due to earthquake damage.

Posted by: James at October 4, 2013 11:33 AM

A good start would be to actually build stuff to their legal limits and not be putting 350' towers zoned for 700' ones.

Posted by: sf at October 4, 2013 12:12 PM

Seriously sf?

How does building towers to their "limit" as you say have ANYTHING to do with this topic?

Posted by: Futurist at October 4, 2013 12:26 PM

That said, James, this building was the poster child for at least one school bond (maybe two, I don't quite remember). It was targeted as seismic rehab and renovation into a downtown School of the Arts. Which would be brilliant, given the neighborhood. So part of this story is the incredible mismanagement of school bond funds over the years and/or the very misleading assertions (i.e. lying) about what could be accomplished with the funds. Because this building still sits there 25 years after the quake.

Posted by: curmudgeon at October 4, 2013 12:33 PM

Why not use one or more of these buildings to house the bums (you call them homeless)that flounder in our parks. San Francisco is looking more and more like Calcutta.

Posted by: Congress Hazel at October 5, 2013 12:49 PM

I'm with Pat Burns.
Sell them.

Posted by: james jr at October 7, 2013 4:24 PM

WHAT ABOUT ALL THOSE VACANT STREET PARCELS?? There are literally hundreds of one-block long stretches of streets where a street becomes discontinuous, usually too steep for normal auto traffic, but nevertheless highly developable as residential property. Is anyone even paying attention to this vast hoard of parcels for residential development?? More affordable housing???

Posted by: Joel K at October 7, 2013 6:05 PM

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