Having peaked at 116 in 2014, the number of newly proposed plans for major developments in San Francisco has been trending down ever since, a trend which shouldn’t catch any plugged-in readers by surprise.

And with around 30 preliminary proposals for major projects in the city having been submitted to San Francisco’s Planning Department since the beginning of the year, which is the fewest in the first nine months of a year since 2011, and 53 percent below the average since, we remain on track for a seven-year low in new proposal activity as newly mapped above.

At the same time, with an even greater slowdown in the number of already approved projects actually breaking ground, the pipeline of potential apartments and condos to rise in San Francisco hit a record high in the second quarter of the year and the inventory of existing homes on the market is at its highest level since 2011 while sales recently dropped to a seven-year seasonal low.

Recent Articles

Comments from “Plugged-In” Readers

  1. Posted by Billy Ray

    Well I guess this is how good the city will get. First the 20’s then the 70’s then early 2000’s then 2016. So I guess we will have to wait till 2040 for the next boom and build…

  2. Posted by guest

    Reasons for the drop? Do people think it’s the end of the cycle? Is it the higher inventory and stalling prices? Or is it that under the current zoning ordinances and with the projects already proposed, there’s nothing left to propose? Or are there other reasons?

    • Posted by ivelivedhere25yearsoeverythingisayisright

      Construction costs have escalated dramatically, affordable housing requirements have doubled, entitlements are somehow even more challenging, and the potential repeal of Costa Hawkins looms large (which could potentially make new construction subject to rent control). All this should mean is that land has been de-valued.

      But land is very sticky as most land owners are happy to sit on their Prop 13 protected sites and continue to collect rent for whatever the current use is while they wait for values to get back to their 2015/2016 values.

  3. Posted by Billy Ray

    The city is corrupt and full of red tape addicts. I expect more and better building. Taller and smarter cities. We should be leading the USA in how and what to build! Instead we cannot even stay in the race…

  4. Posted by Dave

    Not a surprise. The number of units in projects abandoned or put on hold is 2207. Projects are not being abandoned in LA or other booming metros. Per the Chronicle that number is almost 7000. Population growth for the BA is anemic – so projected. Compared to places like Phoenix and Seattle and even LA. Job growth has slowed at the same time job growth is booming generally in the US. SF is not a good investment at this time. History will tell, but the population of the City may have hit its historic peak. Regulations and a Planning Commission that couldn’t plan itself out of a crowed restaurant are to blame but so much else too. As a corrupt city government. The permit process was highlighted in a recent SS article – a sham.

    More generally the BA as the center of tech will become less so over the coming decades. The Berkeley entitlement put up for sale and then priced reduced as highlighted at SS today is another sign. The lack of a regional transportation system that works, the lack of a municipal transportation that works. The absurd home prices. A tiny home across from us in Miraloma went on the market Sunday. 1.6 million – monthly payments, with 350K down, will be 9K (taxes and insurance included). Techies are fleeing to pneumonia gulch as they can’t afford much of the rest of SF. This is not rocket science. Storm clouds were gathering back in 2015. Folks have been in denial and, though I don’t post here as much as I once did, when I do the stories are not about new development so much anymore as ancillary related real estate news or entitlements put up for sale. It is what it is and, to take coin a phrase from SS, it should not come as a surprise.

    • Posted by zig

      Google, Salesforce and Facebook at least are still planning huge expansions are far as I am aware. Where I live in the Peninsula it is a madhouse that is just getting worse. Even a “win” for housing like the redevelopment of the Vallco mall in Cupertino is a net loss for housing/jobs when you consider it comes with too much commercial space. I see this still up and down the Peninsula

      • Posted by Richard

        Agreed. Nobody goes to the BA any more. It’s too crowded.

  5. Posted by Pablito

    Bureaucracy. Propose a project in SF? You get hit with like 30 different extra requirements to solve ‘impacts’ caused not by the project – but by years of political neglect.

    Despite the incredible demand – the costs you have to absorb make too few projects pencil. Sigh.

  6. Posted by SFRealist

    We have the best economy of any place in America, but SF can only keep increasing costs on building new housing so far before it becomes unprofitable. We appear to be at that point.

  7. Posted by Foghorn

    The true reason is that developers cannot make 25% affordable housing work. The only projects that have it have a major office component to them. Developers will not build to meet demand prices stay sky high

    • Posted by SocketSite

      Keep in mind that the majority of developments in the pipeline which have already been approved but have yet to break ground are grandfathered with lower affordable/inclusionary housing requirements.

      • Posted by Dave

        The poster child for that is One Oak. Approved years ago with less stringent BMR requirements it no longer pencils and is being abandoned. IIRC the added heights in The Hub come with even more stringent BMR requirements. Grandiose plans for several 500 foot towers that may never come to fruition as the economics aren’t there.

  8. Posted by Amewsed

    Also add in the problems Prop 10 generates, not just for investment properties/rentals but for owner occupied homes as well should life circumstances change and owners want to rent their homes.

    Met a retired cardiologist whose extended family of physicians would not invest in Bay Area real estate because one family member purchased a Berkeley apartment complex, was sued by neighbors for nuisance despite having full security cameras and the case was litigated to the CA Supreme Court. $1M in legal costs and after fighting with their insurer over coverage (with another set of insurance counsel), insurer ultimately picked up coverage.

    • Posted by Neighborhood Activist

      Yes, Prop 10 will be a disaster for housing if it passes. No developer in their right mind will take a risk on building new rental housing, and even single family starts may be impacted in rent control jurisdictions.

      • Posted by SFer

        Leave it to the progressives to destroy the city w/out hesitation, but the sliver lining is that many homes may be that rentals now will be sold to owner occupiers shifting the political base to the center. A win for SF’s future IMO.
        I hope Prop 10 will not pass because in SF we need the state to protect regular Americans from our communist Board of Supervisors.

  9. Posted by bachman_erlich_overdrive

    Constructive for real estate values.

    Why pay expensive costs, impact fees in the face of rising interest rates, uncertain legal framework on rent control and a hostile political environment?

    Maybe in 2-3 years if/when financial markets soften.

  10. Posted by Miraloma Man

    I don’t hate tech and I like some of the changes that the latest boom has wrought, but maybe it’s time for a break. Let the bright-eyed Millennials and their ilk go somewhere else for a while. I hear Cincinnati is nice.

    Seriously, we have been building a ton of housing on brownfields and other lower-density sites for well close to a decade, and we are running out of the lower hanging fruit. Unless you can convince the West Side homeowners to agree to upzone and sell out, we might be reaching our limit. If you guys want San Francisco to grow so badly, we need some more real estate….I know it’s almost impossible to annex across county lines, but it would make a lot of sense for San Francisco to break out of its 1856 Consolidation Act straighjacket, which cut us off from what was supposed to be our expansion zone (San Mateo County). If we annexed Daly City, Colma, Brisbane, So. City, Pacifica, San Bruno, and Milbrae, we’d have a lot of room to work in and we could make those laggards build up. Actually, South City is doing a good job. In addition, we’d be back in third place in terms of the most populous cities in California.

    • Posted by zig

      How is South City doing a good job? Not that they are doing any worse than other cities I am almost sure there is more commercial space (translated to new jobs) than there is housing units currently under construction

      I think we can both agree what is around the Milbrae and San Bruno BART stations is a shame but I am not sure how in your fantasy that these cities are annexed into SF would change much? They would act much like the west side of SF and your neighborhood of Miraloma and would not be anti-development. They would still have representation right?

      • Posted by Miraloma Man

        Have you been to downtown South City lately? There is a significant amount of new, multi-family condo and apartment projects throughout the downtown and nearby areas. South City is the only Peninsula city that I can think of that appears to be building a lot of new housing….and not just a token senior housing development.

        Yes, I agree; I don’t see most residents of those cities acting any differently than our own parochial West Siders, but most of these cities have acres and acres of low-density commercial and industrial development, including several dying malls and hundreds of acres of low density commercial/parking lots along El Camino Real. There are also tons of aging warehouses and low-slung industrial buildings in South City and San Bruno near SFO. Granted, there is a demand for light industrial, but a great deal of housing could (and should) be built in these areas within walking distance of both CalTrain and BART. I could also see some sort of BRT or light rail along El Camino to serve much bigger residential buildings. Also, several of these towns have semi-walkable downtowns. Retain the handful of historic buildings, but otherwise, go up and make them round-the-clock, live-work-play destinations, such as San Mateo Ave. in San Bruno, Grand Ave.in So. City, etc.

        Regarding the West Side and suburban NIMBYs, I don’t think you can expect much, but I think we could incrementally “upzone” a lot of the West Side and suburbs by allowing two-family dwellings and accessory units without tearing everything out at once and building big apartment buildings. Sure, they’d fight it, but if you phased it in gradually and used tax incentives, technical assistance, etc., you could really improve the physical building stock. Remember, in many “single-family” neighborhoods in the Bay Area, many houses already accommodate two, three, or more families. That is why you have cars hanging from trees and incredible parking/traffic congestion. But if you replace the decaying 1950s ranchers with a proper multi-family dwellings, increase/improve transit access and other amenities, and you can gradually transition these declining Leave It to Beaver burgs into real, liveable urban neighborhoods.

        P.S., for the record, I am probably the only person in Miraloma Park who thinks that we could completely rebuild our commercial strip at a higher density and also allow two-family dwellings.

        • Posted by Mutal Kudi

          Millbrae has approved >800 units of housing adjacent to the BART station, so that’s a start. I think South City is more aggressively building housing because they have a stronger business base, with companies like Genentech based there bringing in younger workers who would like to live close to work. Millbrae and San Bruno have essentially no large businesses, just retail. As a result they’ve retained this “small town” mentality which inhibits development. I’m hoping that something is done at the state level to force cities to develop transit-adjacent areas.

          • Posted by zig

            South City is also building a lot of new office space in Oyster point so net I think the housing/jobs imbalance if getting worse when it is all said and done

            Adjacent to Millbrae and San Bruno BART is a regional crime. San Bruno rebuilt a 1950’s mall and Millbrae has a pretty underwhelming plan too.

    • Posted by Dave

      Yes. SF is built out. It can’t absorb more jobs and it can’t squeeze in too many more residents. Annex SMC? They would not go for it and neither would individual cities in the County. SMC and especially north SMC has been very restrictive on development. Drive down El Camino from SSF to Burlingame. A broad 8 lane boulevard at points and it is surrounded mostly by one and two story commercial buildings and large parking lots. Only a handful of medium density projects have been built on that long stretch in the past decade. Brisbane does not want housing and is fighting efforts to build housing to complement the massive Baylands development. At 9 million feet of office space it will be much larger than Lennar’s HP/CP project. A developer in Coyote Pointe recently had to withdraw a proposal for a large residential project after pressure from Office developers and the city. Those groups want the land for more offices.

    • Posted by Dave

      The counties should be consolidated with SF becoming part of SMC. The supervisors could then run for city council in SF. SamTrans and Muni should be one system. The advantage of other metros is that policitcal entitles tend to be larger physically so a more efective “regional” approach can be taken to transportation and housing issues. Or SF could become part of Alameda County with Oaklnad absorbing SF as a city. The two poliical entites on either side of the Bay as a single entity would do wonders for planning jobs and housing.

  11. Posted by BTinSF

    SF is far from “built out”. Just as an example, it should replace all the low rise along Geary Blvd with 10-12 story midrise or taller and should build a subway/metro line underground as far west as Arguello with continued rail in the median to the ocean.

    And while that is happening, every building on Market St as far west as Castro that is under 4 floors should also be replaced with midrise while the hub highrises are built.

    The problem is not places to build and there is no need for the City to expand its borders. The problem is disincentives to build imposed by the “progressive” city leadership most of which have been detailed above.

    • Posted by Miraloma Man

      First off, I don’t think you can say with a straight face that San Francisco’s city leadership is preventing housing from being built. I don’t have the numbers at hand, but I’d estimate that more housing has been built in the current boom than at any time since the pre-WWII defense boom, when the city still had hundreds of acres of undeveloped land on the West Side. Second, I would argue that San Francisco’s rather arduous approvals process is largely warranted. Building a new condo/high rise in an already urbanized context is not the same as plopping hundreds of SFRs onto former farmland. The potential impacts are many and the stakeholders legion. I am not arguing that the Planning Department is especially efficient, but they have a very important charge: making sure that what gets built today does not become a liability in the future.

      Based on your use of dinosaur claws around “progressive,” I am assuming that you are of the Libertarian bent? If so, I assume that you also believe in private property rights? As you probably know, the Planning Department upzoned most of Market Street between Van Ness and Castro almost a decade ago. Since then, many of the gas stations, empty lots, and one-story buildings have been replaced with mid-rise residential over commercial buildings, which is exactly what the plan had intended. I agree with you that Geary should be built up all the way as far as the ocean. Aside from a handful of historic buildings, most of those buildings could stand to be replaced. However, unless you are going to use eminent domain, you’ve got to get buy-in from local property owners….many of whom lobbied the City to down zone most neighborhoods to 40 feet in the early 1970s……to a) agree to the upzoning and b) agree to sell out to bigger developers that are capitalized to build the bigger buildings you talk about. Like anything in California, it’s a process that requires consensus. As much as I would like to see a subway to the sea, opposition from the Richmond Merchants’ Association and various other anti-transit types will likely make sure that it never happens. And without the transit you really can’t develop Geary beyond what it is now.

Add a Comment

Your email address will not be published. Required fields are marked *