December 31, 2013
Plans For Another Twelve-Story Mid-Market/Tenderloin Tower
Shorenstein Properties has filed preliminary plans to build a 12-story residential building designed by Bernardo Fort-Brescia of Arquitectonica on a parcel which fronts Market Street between Jones and Taylor but is primarily the parking lot on the southeast corner of Jones and Golden Gate Ave.
The proposed 1066 Market Street development includes 301 apartments with 111 two-bedrooms, 55 one-bedrooms, and the rest a mix of studios and "junior ones" according to the Business Times.
In addition to the apartments, preliminary plans include 2,000 square feet of new retail space along Market Street and 3,500 square feet of (legal) "active use" along Golden Gate Avenue and Jones. Parking for 112 cars would be built underground.
33 Brand New Mid-Market Apartments For Around A Grand A Month
While the going price for a new studio apartment in San Francisco is averaging over $2,400 a month and Mid-Market one-bedrooms are running closer to $3,500 for 700 square feet of space, eleven (11) of the new one-bedrooms in the 273 unit building nearing completion at 55 Ninth Street between Market and Mission dubbed "AVA" will be available for $1,066 a month, twenty-one (21) two-bedrooms for $1,192. One 528-square-foot studio will be rented for $939 a month.
So what’s the catch? As part of the Mayor's Office of Housing and Community Development Below Market Rate (BMR) Rental Program, applicants for the 33 BMR units cannot make more than 55 percent of the area median income, which means a single person can make no more than $38,950 a year, a couple can make no more than $44,500.
While the maximum income for a single person is $38,950 a year, the minimum income for any of the units in the building will be two-times the monthly rent: $25,584 a year for a below market rate one-bedroom and $28,608 for a two. Twelve parking spaces for the BMR units will be available at a discounted rate of $100 a month.
Applications for the 33 apartments are due by 5pm on January 21, 2014.
∙ Bay Area Rents Climb, East Bay Jumps 10 Percent In 3 Months [SocketSite]
∙ AVA (55 9th Street) Below Market Rate Apartment Program [sf-moh.org]
San Francisco Home Price Index Slips, Condos Values Hold
Having been slowing for five months following the record setting gains recorded in April and May, single-family home values in San Francisco ticked down in October according to the S&P/Case-Shiller Home Price Index, the first decline since February of 2012. At the same time, San Francisco condo values were flat in October, the first month without a month-over-month gain in almost two years.
Up 24.6% year-over-year, the index for single-family home values in the San Francisco MSA recorded a 0.2% decline from September to October 2013 and ticked down to 17.8% below a May 2006 peak.
For the broader 10-City composite (CSXR), home values gained 0.1% from September to October and are up 13.6% year-over-year but remain 20.3% below a June 2006 peak.
"Home prices increased again in October," says David M. Blitzer, Chairman of the Index Committee at S&P Dow Jones Indices. "Both [the 10 and 20-city] Composites’ annual returns have been in double-digit territory since March 2013 and increasing; now up 13.6% in the year ending in October. However, monthly numbers show we are living on borrowed time and the boom is fading.
"The year-over-year figures increased slightly from last month. Thirteen cities and both Composites posted double-digit annual returns. Cities at the top of the range (Las Vegas, San Diego and San Francisco) saw smaller annual increases. On the other hand, cities that have been relatively underperforming (Cleveland, New York and Washington) saw their annual gains grow. Miami showed the most improvement. Chicago recorded its highest annual rate (+10.9%) since December 1988. Charlotte and Dallas posted annual increases of 8.8% and 9.7%, their highest since the inception of their indices in 1987 and 2000.
"The key economic question facing housing is the Fed’s future course to scale back quantitative easing and how this will affect mortgage rates. Other housing data paint a mixed picture suggesting that we may be close to the peak gains in prices. However, other economic data point to somewhat faster growth in the new year. Most forecasts for home prices point to single digit growth in 2014."
While prices actually ticked up for the lower two tiers of San Francisco properties in October, a decline at the top offset their gains for the index as a whole.
The bottom third (under $495,051 at the time of acquisition) gained 0.4% from September to October (up 37.5% YOY); the middle third gained 0.2% from September to October (up 26.9% YOY); and the top third (over $806,285 at the time of acquisition) fell 0.5% from September to October, up 17.7% year-over-year versus 19.3% in September.
According to the Index, single-family home values for the bottom third of the market in the San Francisco MSA are back to July 2003 levels (37% below an August 2006 peak); the middle third is back above August 2004 levels (18% below a May 2006 peak); and the top third remains just above April 2005 levels and 6% below its August 2007 peak.
Condo values in the San Francisco MSA were unchanged from September to October but are up 26.1% year-over-year and to within 4.6% of their December 2005 peak.
Our standard SocketSite S&P/Case-Shiller footnote: The S&P/Case-Shiller home price indices include San Francisco, San Mateo, Marin, Contra Costa, and Alameda in the "San Francisco" index (i.e., greater MSA) and are imperfect in factoring out changes in property values due to improvements versus appreciation (although they try their best).
∙ Home Prices Stage Advance According to the S&P/Case-Shiller Index [Standard & Poor's]
∙ San Francisco House And Condo Values Tick Up But Slow Their Roll [SocketSite]
December 30, 2013
Demo Approved But Permit To Build 40-Story Tower Suspended
As we reported in September, "with the one-year extension to start work on the 40-story residential building approved to rise at 340 Fremont Street set to expire in two months, the building permit for the 348-unit development has yet to be approved but it is making its way through Planning with the demolition permit to clear the site for construction awaiting a few signatures as well."
Today, the demolition permit to clear the site for the 40-story tower to rise at 340 Fremont Street was approved and it would appear that they're getting ready to rubble. That being said, having been issued last month, the permit to actually build the tower has been appealed and suspended.
A Big End Of Year Sale In Premiere Pacific Heights
Listed for $11,250,000 this past March and reduced to $10,250,000 in September, the sale of the Pacific Heights home at 2666 Broadway "with Distinctive Artisan Finishes" closed escrow today with a reported contract price of $8,650,000 or roughly $1,750 a square foot.
Originally designed by William Wurster and purchased in great condition by a New York based Internet entrepreneur for $4,700,000 in November 2011, the Pacific Heights home was rebuilt over the course of a year at an undisclosed cost of "about four times what [the buyer] was quoted."
While Still Cheap, Higher Mortgage Rates Are Slowing Home Sales
The National Association of Realtors Pending Home Sales Index inched up a nominal 0.2 percent in November, the second lowest level for the seasonally adjusted index in 2013 and down 1.6 percent on a year-over-year basis, the third year-over-year decline in as many months.
As we wrote in August: Rising Rates Start Reeling In Pending Home Sales.
While higher borrowing costs are bearing the brunt of the blame for the slowdown in home sales, and mortgage rates have increased 35 percent from an all-time low of 3.31 percent in November of 2012 to around 4.5 percent today, keep in mind mind that mortgage rates remain over 30 percent lower than their average of 6.7 percent since 1990 and are nearly 50 percent lower than average over the past 40 years.
December 27, 2013
Plans For 12-Story Building Could Transform A Tenderloin Block
Having been banned from the church for being disruptive, a protester has been stationed outside the Fifth Church of Christ, Scientist’s building at 450 O'Farrell Street on a near daily basis for over a year, accusing the Church of having turned a blind eye to the boarded-up property it owns next door, "leaving hard drugs, blight, and homelessness to dominate its state" and surroundings.
Perhaps due in part to the protesting, but more likely driven by the Mid-Market boom which is spilling over into the Tenderloin, the Fifth Church of Christ, Scientist has quietly drawn up plans to raze its columned church and adjacent boarded-up storefronts and construct a twelve-story building in their place, rising 130 feet with 97 individual dwelling units and 74 group housing units over a new 10,000-square-foot church, 6,000 square feet of retail, and 100 parking spaces.
Remodeling Permit Suspended, Emergency Stabilization Approved
Two days after our piece about the "remodeling" in progress at 2178 Pine Street, the permit for the approved project was suspended and a notice of violation was sent.
Three days after the permit for 2178 Pine Street was suspended, 125 Crown Terrace collapsed, another approved "remodeling" which had been underway. The next day, an emergency permit to stabilize the floating façade at 2178 Pine Street was triaged, approved and issued.
The permit fees for the previously approved project on Pine Street had been based on an estimated project cost of $250,000 for the "remodel," $210,000 for shoring up the site, and $80,000 for adding a garage and new steps. The estimated cost for simply stabilizing the façade following the project's suspension was $50,000 alone.
December 26, 2013
SoMa Rising: Plans For Up To Fifty New Units On Folsom Street
Plans to largely demolish the auto repair shop at 1465 Folsom Street and construct a five-story vertical addition with between forty (40) and fifty (50) new dwelling units have been submitted to San Francisco’s Planning Department for their preliminary review and reaction.
As proposed, the five-story addition would be setback from the existing building's facades on Folsom and Juniper and the ground floor of the development would become 3,384 square feet of commercial space along Folsom Street, a bit of interior open space, and a 28-space garage.
Rolling Out The Rolls To Move A Mansion By The End Of The Year
Positioned as "a glamorous and fun incentive" for agents to move the Herbst Manor over the next couple of weeks, a plugged-in tipster reports that a restored 1962 Rolls Royce Silver Cloud II valued at $50,000 will be included as part of the sale if you're in contract to buy the Pacific Heights mansion by December 31 and close escrow by January 15, 2014.
Another Year On The Market For The Madeover Herbst Manor
A wealthy art collector from Philadelphia purchased the Pacific Heights lot at 2800 Pacific Avenue for $10 in 1899 and commissioned Ernest Coxhead to build a Georgian mansion upon the site for $12,854. In 1967, the 8,120-square-foot home was purchased by the late Adrian and Lee Herbst Gruhn and dubbed the Herbst Manor.
Put on the market for $12,500,000 in 2011 following Lee's passing in 2010, the mansion was relisted for $10,950,000 in 2012 and then again for $11,995,000 earlier this year following a Decorator Showcase makeover.
Reduced to $9,650,000 in September, the price has since been cut to $8,900,000 for the Manor with six bedrooms and five bathrooms, including the master with a living green wall:
∙ Listing: 2800 Pacific Avenue (6/5) - $8,900,000 [2800pacificavenue.com]
December 24, 2013
The Economics Of Urban Trees
As part of the due diligence for San Francisco's Urban Forest Plan, an inventory and accounting for 24,858 publicly managed "street trees" was conducted. And while the math is a little fuzzy, especially when it comes to the socioeconomic benefits, each tree was estimated to contribute just under $160 a year in benefits to the community at large.
A breakdown of the estimated economic benefits and accounting per tree:
1. [The 24,858 inventoried] trees reduce electricity and natural gas use in their neighborhoods through shading and climate effects; a benefit totaling $257,418, an average of $10.36 per tree.
2. [The inventoried trees] sequester 1,173 tons of atmospheric CO2 per year. An additional 626 tons is circumvented through decreased energy use, resulting in a net value of $24,691.45 and an average of $0.99 per tree.
3. Trees improve air quality through the absorption and deposition of chemical pollutants. The trees in this inventory remove 5,089 lbs of Ozone, Nitrogen Dioxide, Sulfur Dioxide and particulate matter (PM10) annually for an estimated benefit to the City of $53,360 each year. [Editor's Note: Biogenic volatile organic compound emissions, especially from Redflower gums, offsets the total air quality benefit by $79,866, for an annual net cost of $0.53 per tree.]
4. San Francisco’s inventoried trees intercept an estimated 19.2 million gallons of storm water annually for a total value of $1,999,994 per year, an average of $80.46 per tree.
5. The total annual benefits contributed by San Francisco's inventoried trees to property value increases, aesthetics, and socioeconomic value are approximately $1.7 million, an average of $67.52 per tree.
On the expense side, it was estimated that the City of San Francisco currently spends roughly $900,000 per year to maintain the inventoried trees, an average of just over $36 per tree. An accounting for the private investment to maintain the city's inventory of trees, in terms of time and money, was not included as part of the study.
San Francisco Officially Bids For Another America's Cup
In a letter to sent to Oracle Team USA's CEO yesterday, Mayor Ed Lee has officially expressed San Francisco's interest in hosting the 35th America’s Cup in 2017, but with a few changes.
As proposed, the America’s Cup Park and Pavilion would return to Pier 27-29 and the teams would be based upon Pier 27-29 as well rather than on Pier 30-32. Marina Green would once again serve as the secondary venue for Cup viewing and concessions.
The City would like the months-long schedule for the Cup to be condensed and is not offering any development rights nor long-term transfers of real estate as part of their proposal.
Race organizers are expected to pick the host city for the 35th America's Cup by March 1, 2014.
December 23, 2013
Presentation Of Proposals For Presidio Redevelopment Set
With the National Park Service having expressed their serious concerns about George Lucas' proposed Cultural Arts Museum and strongly recommending that the Presidio Trust defer any decisions with respect to redeveloping the Presidio's former Commissary and current Sports Basement site for several years, the Presidio Trust Board of Directors meeting to review the revised proposals for the Mid-Crissy Field site ought to be a lively affair.
The public meeting and presentation has been scheduled for January 27, 2014 at 6:30 pm.
Having Peaked In 2012, Foreclosures Plummeted In 2013
As we first reported last December, with over 500 homes being taken back by the bank or sold to a third party on the courthouse steps, 2012 was the peak for homes being foreclosed upon in San Francisco and we expected foreclosure activity to dry up in 2013.
Having forecast fewer than 100 foreclosures in 2013, a drop of 80 percent from 2012 and fewer foreclosures than occurred in 2007, San Francisco in on track to end the year with just over 80 properties having been foreclosed upon in 2013, a drop of 84 percent versus the previous year.
There are currently just over 100 properties scheduled for auction in San Francisco versus 330 at the same time last year, 39 percent of which are in District 10*. Roughly 85 percent of scheduled auctions were cancelled over the past year versus 70 percent in 2012 and the number of San Francisco properties in pre-foreclosure currently totals 160 versus 286 at the same time last year.
*Editor's Note: In an attempt to match and map two disparate data sets, we include 94124, 94134 and 94112 in "District 10," which results in a slightly larger area than the District as defined by the San Francisco Association of Realtors.
Luxury Platinum Living In Noe Valley
Purchased as an 810-square-foot Noe Valley fixer for $850,000 in 2011, an expansion of 4365 26th Street's main floor by 540 square feet and the addition an all-new 1,300 square foot second floor were approved for the home in 2012, a project which survived a Discretionary Review.
Designed to be LEED Platinum certified, green features of the rebuilt home include 16 solar panels on the roof, a 1,000 gallon rainwater catchment system for irrigating the greens out back, and a reclaimed-wood floating staircase from a Warner Brother's warehouse inside.
With four bedrooms on the new upper level, the main level has been opened-up and opens up to an outdoor kitchen, patio and the terraced edible garden (click the floor plans to enlarge):
While not yet officially listed, the Noe home is now on the market for $3,995,000. And yes, the garage is wired for an electric vehicle charger should a new Tesla arrive tied with a bow.
December 20, 2013
San Francisco Is Closing In On Dot-Com Days Peak Employment
The unemployment rate in San Francisco ticked down from 5.3 percent in October to 5.2 percent in November, matching the lowest unemployment rate in the city since June of 2008 when 434,000 people out of a labor force of 457,800 were employed.
With a current labor force of 483,700, the number of employed residents in San Francisco now totals 458,800, up by 14,300 workers over the past year and within 6,700 of the 465,500 people employed at December 2000's dot-com peak when the unemployment rate measured 3 percent. The unemployment rate in San Francisco topped out at a little over 10 percent in January 2010 when 51,100 fewer San Francisco residents were employed than today.
The unemployment rates in Marin and San Mateo are down to 4.6 percent and 5.0 percent respectively while the unadjusted unemployment rate for California remains at 8.3 percent.
Salesforce Tower Supersized To 30 Stories
Having survived an appeal and then an appeal to re-hear the appeal, the paperwork has been signed to allow the office tower under construction at 350 Mission Street to reach a full 30 stories and 455 feet in height versus 375 feet as was originally approved.
The 420,000-square-foot building which will be fully occupied by Salesforce when finished includes retail and restaurant space on the ground floor and mezzanine and an open 10,000-square-foot lobby with 50-foot ceilings at the corner of Mission and Fremont.
Plans For A 16-Story Hotel In Downtown Berkeley
A proposal to construct a 16-story building with a 290-room hotel, three floors of office space, and ground floor retail at the corner of Shattuck Avenue and Center Street is expected to be submitted to the city of Berkeley tomorrow.
If the plans are approved, construction on the 180-foot-tall hotel development would commence in 2015 according to the Business Times.
December 19, 2013
Four-Story Marina Building Approved To Rise
The proposed four-story building to be built on the south side of Lombard between Pierce and Scott has been approved to rise with 21 market rate dwelling units over ground floor retail and parking.