New Housing Construction Report

San Francisco New-Housing Construction Trends
Within its 47 square mile envelope, San Francisco is already the 2nd most densely populated 
city in the United States, and it’s growing denser, more affluent and more expensive.
May 2014 Report with 13 Custom Charts

The charts included are mostly based on the San Francisco Planning Department’s excellent Housing Inventory and Pipeline reports, which can be accessed using the links at the bottom of this article. Quotes below are excerpted from these reports.

Packed with information, the data in one report section will not always agree perfectly with that in another – due to the multiple sources of data used by the Planning Department – and this is reflected in our charts as well. In the complex, lengthy process of new-housing application and review, public hearings (and, lately, ballot proposals), revisions, entitlement, permitting, construction and completion, how and when a project is counted may vary. Housing units are being built and being removed, and there are so many types: rental or sale, market rate or affordable, social-project housing or luxury condominiums.

Last but not least, this landscape is in constant flux – new projects, plan changes, and shifts in economic and political realities. Everything below is simply a good faith estimate. The basic reality is that San Francisco, after its recent 2008-2012 new-construction slump, is now experiencing a building boom. So far, however, it has not been able to keep up with population growth and rising buyer/renter demand.

Adjusting your screenview to zoom 150% will make the charts that much easier to read.

New-Construction_Authorized-Completed

New construction authorized typically will not show up as housing units completed until later years. And, of course, a developer can decide not to build after authorization if market circumstances change. The post-2008 drop in authorizations is clearly illustrated here.

“Some of the larger projects completed in 2013 include: 1190 Mission Street (355 market-rate units and 63 affordable units), Rincon Green (277 market rate units and 49 affordable units), Nema (279 market rate units and 38 afford­able units).”

“Very large projects (200 units or more) filed in 2013 and are under Planning Department review include: Mission Rock (1,500 units); 150 Van Ness Avenue (429 units); 41 Tehama Street (398 units); 1066 Market (330 units); 950 Market Street (316 units); and 1301 16th Street (276 units).”

Besides the above projects, rarely a week goes by in which new commercial property sales aren’t being announced – such as the Honda dealership lot and the KRON Building, both on Van Ness – with plans for large-scale residential development projects.

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New-Homes-Pipeline

A glance at the recent past, the present and the possible future of new housing construction in the city. New projects are continually entering and moving through the pipeline, and existing plans may be changed or even abandoned.

“There are currently 857 projects in the pipeline. Of these, 74 percent are exclusively residential and 17 percent are mixed-use projects with both residential and commercial components. Only 8 percent of projects are non-residential developments. A net total of 50,400 new housing units would be added to the city’s housing stock according to current data. Around 18 percent of all projects, representing 6,000 net added housing units and 2,750,000 sq. ft. of commercial space, are under construction. Around 20 percent of projects (with another 4,200 net units and 3,8 million sq. ft. of commercial space) have received building permit approvals. As of the time of writing, some may have moved to the construction phase.”

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New-Construction_by-Bedrooms

We haven’t found an easy place for construction data by unit size, so this chart is extrapolated from the last 7 years of SF MLS sales of condos built 2001 -2014. It may not apply perfectly to units built as apartment rentals or affordable housing.

Typically, the smaller the unit, the higher the dollar per square foot value on sale or rental, however in San Francisco, 3+ bedroom condos are often high-floor units with spectacular views that sell for extraordinary sums – but these would be outliers to the general rule. The city plan appears to have a bias for 2-bedroom units, which it designates as “family units” – this may be an anachronism considering that 38% of city residents live alone and that SF has the lowest percentage of children of any major U.S. city. Of course, many singles and couples like to have a guest bedroom or home office.

However, in 2012, the city agreed to allow the construction of 375 “micro-units,” apartments of 220 to 300 square feet, including kitchen and bath. A few dozen have been built – one article mentioned a rental rate of $1850/month – and another 160 are under construction in the mid-Market area. It will be interesting to see how this trend develops (or doesn’t) in both the rental and for-sale markets. It might be a good match for the relatively young (but well paid), non-driving, high-tech workers pouring into the city.

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New-Construction_by-SF-District

New construction has been concentrated in a few specific districts of the city, mostly where higher density housing projects are most viable. “The ‘hot spot’ for much of this development is Market Street at various sections of it.”

The ability to take under-utilized commercial property sites and turn them into multi-unit or even high-rise residential projects is particularly prized: “There are 50 projects in the current pipeline data­base proposing demolition or conversion of existing [commercial] build­ings to residential use.” “Nearly all units replacing office uses are in mid- to high-rise residential structures of 20 to 500 housing units in high density zoning districts. These projects are mostly concentrated in the eastern half of the city: Rincon Hill, East SoMa, Showplace Square & Potrero Hill, Transbay, Mission and Downtown.”

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New-Housing_Construction-Conversion

Three issues regarding new condo construction: the year in which a project is designated as “completed” in city reports can vary, depending on the department and the dating of events within the process (so this chart won’t perfectly tally with others). Secondly, some developers build and record the units as condos but then rent the units instead of selling them. Finally, new housing projects are now typically required to sell or rent about 15% of units under affordable-housing rules. All these factors affect how new condo construction impacts rental and sale markets.

“Single-family building construction made up a very small proportion of new con­struction in 2013 (1%).” Very few new houses are built in San Francisco, as developers prefer to build higher density housing projects on our limited supply of land. The houses that are built are typically big and expensive.

“Seventy-six percent of the condominium conver­sions in 2013 (279) were in buildings with two or three units.” The rules governing condo conversion in San Francisco are byzantine, politically-wrought and ever-changing, and the changes affect the ability to convert existing multi-unit properties and TICs into condominiums. Two-unit properties are much the easiest to convert into condos and accordingly enjoy a sale price premium.

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AvgDolSqFt_Condo-by-Era-Built

The first golden age of SF apartment buildings, many of which were later turned into condos, was in the period of 1920 – 1940: The units in these buildings are large, light, gracious and filled with elegant detail. Pacific Heights and Marina are filled with these buildings. Though there are beautiful condos built in other eras (Edwardian flats, Art Deco apartments), the second golden age really arrived with the latest burst of new-condo construction, built for an increasingly affluent population: These units are ultra-modern, high-tech and feature highest quality finishes and amenities. They are exemplified by the new, luxury high-rises of the greater South Beach-Yerba Buena area, though variations on this theme, in non-high-rise form, have been springing up all over the city.

The units in these newer buildings command a premium both when rented or, as seen in the chart above, when sold – now surpassing an average dollar per square foot value of $1000. This is the major motivator for developers today.

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Affordable-Housing_Construction

New housing typically conjures images of new condo developments, but it’s more complicated. Within new market-rate condo and apartment projects – rental housing construction has also been jumping with the recent large spikes in rents – typically 15% of units are required to be affordable housing: 220 of these “on-site” units were built in 2013. Add in social-project housing of one kind or another, and 36% of all new units built in 2013 were affordable housing. These units are allocated, rented and sold under rules and formulas pertaining to social and economic circumstances and housing cost.

“About 93% of the new affordable units are rentals affordable to very-low and low-income households.”

“Major affordable housing projects completed in 2013 include: 25 Essex Street (120 units); 701 Golden Gate Avenue (100 units); 474 Natoma Street (60 units); 1075 Le Conte Avenue (73 units); 60 West Point Road (54 units); and 61 West Point Road (13 units).”

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Housing-Units_Lost

There are not only new housing units being built, there are existing housing units being removed from the city’s inventory of housing stock – demolished, merged (2 or more legal units into 1) and abated (illegal units): one less the other equals the net housing unit increase.

There is currently proposed legislation to encourage the legalization of illegal housing units in San Francisco, estimated to exist in the tens of thousands. This is problematical because the reason most of these units are illegal to begin with is that they don’t conform to housing codes – ceiling height, light and ventilation, and fire safety issues are most common – and cannot easily, without substantial expense, be altered to comply.

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New-Home_Construction

This is another approximate snapshot of how general economic conditions affect new housing construction. When the financial markets crashed in 2008, new construction went into a tailspin due to demand and financing issues. As the economy has recovered, it has sprung back to life – as is clear by all the cranes stalking the city’s lots. Like most financial markets, real estate development has economic cycles – cycles that often include dramatic booms and crashes. This is exacerbated by the length of time between a developer’s initial plan and land purchase, and the completion of the project, which often runs to years. It can be difficult enough to predict what market conditions will be next month, much less in two, three or more years.

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Housing-Inventory_by_Property-Type

We created this chart in 2013 with data compiled from a variety to sources we deem reliable. All the numbers should be considered very approximate – and they are constantly changing – but the chart is generally representative of the existing housing breakdown in San Francisco.

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New-Construction_by-County

New home construction in the Bay Area is currently concentrated in 3 of the 4 hottest rental and/or purchase markets in the country: the greater Silicon Valley area, San Francisco and the East Bay. Of course, much of this is directly related to surging high-tech employment and wealth.

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What ultimately underpins new housing construction is demand. Below are two charts illustrating the white hot rental and sale markets in San Francisco, which are motivating investors and developers to build new homes, and motivating the city and non-profits to accelerate the construction of affordable housing units as well (a very big political issue right now).

From 2010 to 2013, the city added approximately 32,000 residents and increased the number of employed residents by roughly 56,000, many of them in new, well-paying high-tech jobs. In that same period, about 4,200 new housing units were added, not remotely adequate to meeting demand. And it is currently projected that the city’s population will continue to grow in coming years. When demand soars and supply is inadequate, prices and rents go up (in the city’s recent case, feverishly), and builders start building again as quickly as they can, hoping to catch the wave at exactly the right time.

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Below are image- links to the actual SF Planning Department Pipeline and Housing Inventory reports issued in February and April 2014, upon which many of the above charts were based. They contain huge amount of data, which we have attempted to represent accurately. As noted by their authors, who did an incredible job compiling the data, the original reports themselves are “compiled and consolidated from different data sources and subject to errors due to varying accuracy and currency of original sources.”
And this image-link goes to a flowchart of the Planning Department’s
review and approvals process:

Inner Mission: More than a cool address

marketreport_innermission

For most of the past 20 years, the Inner Mission has been a flashpoint. Since the first early 1990s dot-com start-up set up shop in the neighborhood, the debate has raged over who “owns” the large swath of central-eastern San Francisco bounded by Market Street (north), Cesar Chavez Street (south), Potrero Avenue (east) and Valencia Street (west). Today, skyrocketing real estate prices and high-visibility corporate shuttle buses have emotions running higher than ever, with local activists calling for a “return” to the Inner Mission of the past.

Anyone familiar with this vibrant district’s history, however, might want to ask the latest round of protesters this: to which “past” are you referring? The Mission of 2014 resembles the Mission of 1994 no more than the Mission of 1994 resembles the Mission of 1974 or 1954 and so on. This is a place defined by change.

Because it looms so large in the imaginations of San Franciscans (and those beyond), the Inner Mission is too often characterized by brief glances, which is unfortunate. There is far more to this physically large district than cool restaurants, hip bars and bearded young tech workers. They’re there, of course, and they earn the Inner Mission, especially along Valencia Street and to a lesser but growing degree, Mission Street, its cache as San Francisco’s most exciting nightlife district. Some of the city’s most notable restaurants – like Flour + Water, one of Travel & Leisure’s “Best Restaurants in the U.S.” – are in the Inner Mission, as are a number of creatively dynamic theaters and art galleries and, of course, an abundance of cutting-edge startup businesses.

But this place is more than a cool address. Away from the hubbub of Mission and Valencia there are tree-shaded streets, remnants of a time when the Inner Mission was a desirable address for San Francisco’s upper class. Drawn by its sunny weather than recent streetcar proximity to downtown, they built ornate Victorians on the narrow streets between Mission and South Van Ness, Folsom and Harrison. Many of them still stand; few have been restored to their former glory.

Today they are homes to a working-class population that has been in the neighborhood for close to a century. Though it’s a place of constant change, the Inner Mission has always made room for long-time residents and families, the sort of locals that become the fabric of any vital neighborhood.

The Inner Mission has a long history of diversity, stretching back to its days as a neighborhood of Irish, Polish and German immigrants and into the post-World War II emigration of Central and South Americans that gave the district its present-day Latino flavor. Anyone looking for evidence of the Inner Mission’s constant change need only to stroll down Mission Street, where in some spots Spanish is spoken exclusively, then note, only a few blocks away, the Polish Club of San Francisco, at its present 22nd Street location since 1926, or stop at any of the neighborhood’s many Irish bars, in place for decades.

Or they can explore the Inner Mission’s northeastern quadrant, where they’ll find warehouses and small factories, commercial buildings that have served a myriad of purposes during their long histories. On Alabama and Florida Streets, furniture refinishing shops abut galleries, body shops call vegan cafes “neighbor.” Landmark buildings like the San Francisco Armory recall colorful histories that include serving as the city’s primary sports arena (it hosted, among other things, several heavyweight bouts during the 1920s, 30s and 40s), a soundstage for the original Star Wars, and, most recently, an internet concern that makes adult films.

The Inner Mission was once where professional baseball happened in San Francisco. No fewer than three ballparks called the district home, including, famously, Seals Stadium on 16th Street. The longtime home of the Pacific Coast League San Francisco Seals (at one time one of two Mission-based PCL teams, the other being the Mission Reds) was also where the newly-relocated Giants played their first few seasons in San Francisco, beginning in 1957.

Factories, ballparks, amusement parks (Woodward Gardens, 1866-1891), mansions and even a native accent – people speaking the “Mission dialect” were said to “talk like Brooklynites – adds up to an unavoidable fact: that there is far more to San Francisco’s Inner Mission than restaurants, bars and hipsters.

Source : Parascopesf.com

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10 Cragmont Avenue

Seller Represented
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Of San Francisco Real Estate Gold & Apple Stock

May 2014 Report

On January 1, 2012, you woke up to find $200,000 on your bedside table, which you decided to invest. Then, on May 2, 2014, you sold your investment. Below are approximate returns depending on where you placed your cash.

Investment-Return_RE-vs-Stock

Assumptions:

Gold: you bought at $1566 per ounce and sold at $1300 per ounce: Bad timing.

Certificate of Deposit: 1% annual interest rate; interest taxed as ordinary income: It seemed like the safe thing to do in an uncertain world.

Stock purchases: Apple stock jumped 46% and the S&P 500 50%; plus an estimated dividend yield of 5%; profit taxed as long-term capital gains. (No transaction costs included in calculation.)

Home purchase: $200,000 down-payment on $1 million home; 35% home-price appreciation per Case-Shiller; 2% closing costs on purchase and 7% on sale deducted from gain. No capital gains tax due to the $250,000/$500,000 exclusion for sale of primary residence. The estimated $28,000 reduction in loan principal was not included in gain, as it pertains to monthly home payments made after initial investment.

It is assumed that the net monthly home cost – principal, interest, property taxes and insurance, after tax deductions and reduction in loan principal – at an estimated $3250/month, was comparable to cost of renting. This has generally been true in San Francisco due to high rents and low interest rates.

There are 3 big reasons why real estate dramatically outperformed the stock market, though both markets boomed: 1) leverage – 35% home-price appreciation equals 175% appreciation of your 20% cash down-payment (before closing costs); 2) big tax deductions subsidize home ownership costs, and 3) the capital gains exclusion on the sale of a primary residence.

Important: Timing is everything in investing. In this analysis, the chosen buy date was January 2, 2012 when the financial and housing markets were poised for big rebounds. Picking a different purchase date, such as January 2, 2008, would completely alter the results. *

 

SP-OP_DOM_by-MonthWhite Hot Spring Market
The hotter the competition between buyers, the higher home prices are bid up. The great majority of SF home listings are selling quickly and for over – sometimes far over – asking price.

This link charts the trend over the past 2+ years.
Sales Price over List Price Trend

 

 

Paragon-Survey_Home-BuyersCurrent Buyer & Seller Dynamics
Since Paragon does so much business in San Francisco – our Van Ness branch represents more successful SF home-buyers than any other office – we surveyed our agents on what they were seeing in the market. This chart looks at buyers, and this link goes to our full survey report:
Paragon Agent Survey

 

 

New-Home_ConstructionNew Housing Construction
A look at the ebb and flow of new housing development in the city – which is generally very inadequate to growing demand.

And this link looks at the “pipeline” of projects under construction or planned for future years:
New Homes Pipeline

 

 

Ranking_San-Francisco_4-14Ranking San Francisco
On a lighter note, we recently collected rankings by dozens of “authorities” – some more reliable than others – regarding San Francisco. This link goes to the full list:
The Full Ranking Report

 

 

 

Invest_SF-Rents_by-NeighborhoodApartment Building Market Report
We just issued our quarterly update on Bay Area residential investment real estate. This chart looks at current asking rents by neighborhood, and this link goes to the full report:
Paragon Apartment Update

 

 

Since opening our doors in 2004, the Paragon Community Fund has donated over $500,000 to local charities and social services. The San Francisco Bay Area isn’t just where we do business; it’s our home and our community.

* The investment analysis above is simply one scenario based on specific circumstances. It was performed in good faith, but may contain errors or assumptions you may disagree with, or may not apply to your specific tax situation. Investment and tax issues should be investigated with a qualified accountant or financial planner.

South Beach: Part 2

southbeach2aSouth Beach is a district with many distinct personalities — ranging from its Financial District-adjacent hyper-urban vertical self to the quiet dignity of South Park and the shiny waterfront surrounding AT & T Park. It makes perfect sense that a neighborhood of such dimension would have an equally broad housing market, and South Beach does. While it lacks a single-family home option (common for a downtown neighborhood), South Beach checks almost every other housing box.

Are you just out of college, newly well-employed, looking for a studio or one-bedroom apartment in a buzz-worthy location? South Beach has you covered with large complexes like the South Beach Marina and, scattered throughout the district’s southern quadrant, a smattering of small, SoMa-like Edwardian buildings. Are you a wealthy empty-nester or international “citizen of the world” who desires a super-urban pied-à-terre perfectly situated to take advantage of one of the world’s most desirable cities? How about a sleek upper floor unit at a full-service luxury high-rise like the Infinity, the Metropolitan, the Watermark or One Rincon Hill?

Or maybe you’re a successful technology entrepreneur whose dream is a huge, cutting-edge living space showcasing modern design and views of leafy South Park; South Beach has those too, along with lofts in new and refurbished historic buildings, boutique condo buildings and sprawling, early-generation complexes like The Beacon and The Brannan, offering proximity to the waterfront, the ballpark and the growing King Street shopping and dining corridor. South Beach doesn’t have everything, but it does have something for almost everyone.

If that weren’t enough, South Beach is also growing faster than any San Francisco neighborhood outside of Mission Bay. Pause for a moment at the corner of Beale and Folsom Streets, in South Beach’s Rincon Hill section; to say that there is construction happening on all four corners is only a slight exaggeration. It’s happening on three, all in the shadow of South Beach’s landmark residential tower, One Rincon Hill. 50-story One Rincon stood alone, towering above warehouses and low-lying commercial buildings, for several years. Soon it will have neighbors of similar scale to its own.

However many new towers come to South Beach, don’t expect the neighborhood to ever become a “concrete canyon.” In 2005, the City of San Francisco updated its plan for Rincon Hill, calling for a series of towers, yes, but also for interspersed mid- and low-rise construction, creating enough space between high-rises to foster livability and to preserve natural views. The strategy, known as “Vancouverism,” after the well-planned Canadian city, was a response to earlier downtown San Francisco development, which more closely followed the Manhattan model. To put it in urban planning shorthand: “Vancouverism” triumphed over “Manhattanism.”

“Vancouverism” creates room for boutique condo buildings like newly-completed 14-unit 750 2nd Street, for smaller-scale, pedestrian-friendly commercial strips (the 2005 plan designates Folsom Street as one of these) and for existing warehouse buildings like the South End Historic District, in entirety, to co-exist with massive towers like One Rincon Hill. South Beach, already unique because of the housing diversity within its borders, is designed to stay that way.

Like neighboring Yerba Buena, South Beach tilts toward the high end of the real estate market. A recent check of the Multiple Listing Service revealed 32 active South Beach listings. Of those, 18 were priced above $1 million, with a third asking north of $2 million and a median asking price of $1.2 million. Four were lofts, priced in a range of $749,000 to $1.375 million. The rest were condominiums.

For those looking to rent in South Beach, be aware that neighborhood rents run between $500 and $1,000 higher than those in the rest of San Francisco. Expect to pay upwards of $3,000 per month for a one-bedroom unit in South Beach.

It’s not cheap but it is exciting, convenient and chic. 20 years ago, modern South Beach didn’t exist. Today it’s one of San Francisco’s most popular downtown neighborhoods.

Source : Parascopesf.com

New Case Shiller Index

The new February S&P Case-Shiller Index for high-price-tier homes in the 5-county San Francisco Metro Area increased almost 1% from the January reading. This puts the Index up about 20% over the past 12 months, and up about 34% since the recovery began in earnest in early 2012. Based upon what we are seeing in the market, I expect another increase in the March Index. (The Case-Shiller Index is published 2 months after the month specified.)

Case-Shiller_High-Tier_2011

Case-Shiller_from_1990

Buyer-Seller Dynamics in San Francisco

This April 2014 analysis was based upon a survey of Paragon Real Estate Group agents regarding their past 12 months of activity: Paragon agents close over 1000 San Francisco home transactions per year; Paragon’s Van Ness office represents more buyers in successful city home purchases than any other brokerage office.

All percentages are approximate: This was not a rigorously controlled survey and analysis, but more an informal poll; still we believe the data below does generally reflect market dynamics in San Francisco.

San Francisco Home Sellers 

60% are selling to relocate outside of San Francisco: The main reasons, in order of prevalence, are schools (and other family-raising reasons) — which ties in with the fact that SF has the lowest percentage of children of any major city in the country — affordability (the ability to buy more home for the money elsewhere), job-related reasons (relocation, commute) and retirement.

15% involve trust, probate or investor sales, or people moving into rentals or retirement homes, and no new home purchase is involved.

25% are selling in order to buy another property within the city, typically either upgrading to a more expensive home or downsizing to a smaller home, or a divorce is involved.

San Francisco Home Buyers 

50% are first-time buyers. This is a very high percentage: In the U.S. the percentage is about 30% (and, of course, the U.S. median price is under $200k, while the SF median is over $950,000).

Average age of SF home buyers is generally getting younger and is currently in the mid-thirties.

47% of SF home buyers are employed in high tech. This is a distinctly San Francisco phenomenon related to the first 2 points above: An influx of relatively young, often newly affluent, high-tech employed, often first-time buyers – who can afford SF home prices – is playing a decisive role in the market.

20% of prospective SF home buyers have become discouraged and given up on buying in the city, due to the competitive environment and rapidly appreciating prices. They’ve either given up for the time being or shifted their home searches elsewhere.

Less than 3% of SF home buyers are foreign – exposes the myth of foreign money playing a significant role in the SF market. What purchases/investments they are making seem to be mostly in new or newer, high-rise condo developments. (There are cities in the U.S. in which large numbers of foreign buyers are having a significant impact on the market – Miami may be the most dramatic example – but SF is not one of them at this time.)

26% of homes are being purchased via “all cash” offers, though many of these offers are structured this way solely for strategic reasons to get their offers accepted in an exceedingly competitive environment. That is, many of these buyers end up getting loans either before or immediately after close of escrow. (This is a different phenomenon than investors paying all cash for distressed homes in other parts of the country – San Francisco has had very few of these sales in the past 2 years.)

Approximately 10% of home sales occur outside of the multiple listing service, i.e. as so-called off-market/ off-MLS/ pocket listings. This agrees with other analyses Paragon and others have performed.

Conclusions: To a greater extent than is probably normal, there is an exchange process occurring in San Francisco, with existing residents moving out and new residents moving in. One of the biggest reasons for selling is to relocate for better public schools outside SF or to save money by enrolling children in suburban public instead of city private schools; high prices are motivating some city homeowners to cash out to buy bigger/better homes elsewhere; frenzied market conditions are discouraging homeowners who might otherwise sell to buy other (larger, better) homes within the city – many of these homeowners are staying put out of trepidation. This last situation is affecting/lowering the supply of homes for sale.

Population/ Employment Growth and Housing

According to the latest U.S. census data, the estimated increase in the city’s population since 2010 is 32,000; over the same period, the number of employed residents has jumped by over 55,000. Per the Planning Department, the approximate number of new housing units added since 2010 is 4200. With 38% of SF’s households consisting of 1 person, and an average household size of 2.3 persons, we’re looking at over 22,000 new residents who have been looking for homes that don’t exist. This is one of the biggest factors behind the huge upward pressure on rents and home prices.

With the market recovery that began in 2012, another 6000 housing units are currently under construction and most should be ready sometime in the next 2 years. Housing units include condos (sales), apartments (rentals), houses (a very few) and community housing projects.

South Beach: Part 1

southbeach2In 2010, when the San Francisco Association of Realtors re-drew their city district map, it split what had been one massive district (SoMa) into three more manageable ones (SoMa, Yerba Buena and South Beach). In the wake of this decision, some self-labeled “purists” cried “foul,” suggesting that the “new” neighborhoods were “made up.”

In the case of South Beach, they couldn’t have been more wrong. No one with a sense of local history would have blamed the SFAR if they’d take their task a step further, splitting the new District 9H into at least three separate mini-districts: the South End, South Park and Rincon. If these names sound familiar, they should; each played a role in early San Francisco history.

There was a time when a South Park or Rincon Hill address meant more than one on Nob Hill or Pacific Heights. Long before “little cable cars climb(ed) halfway to the stars” San Francisco’s elite built their mansions “south of the slot,” on Rincon Hill, located in the northeast quadrant of today’s South Beach and in South Park, a gated development located on Rincon’s southern slope, modeled after a neighborhood in London, England. South Park featured San Francisco’s first paved streets, along with mansions and elegant row homes.

Rincon Hill was the Pacific Heights of its day. During the 1850s and 60s, says historian Charles Lockwood, “dozens of large, comfortable homes were built (on Rincon Hill) that reflected the era’s popular architectural styles: Greek Revival, Gothic Revival, Italianate and Second Empire.” Unfortunately, its reign atop the San Francisco class heap was short. In 1869, the neighborhood was literally cut in half by the Second Street cut (an effort to make it easier for wagons to get from downtown to the southern waterfront). By the 1880s, author Robert Louis Stevenson was referring to Rincon as “a new slum.” The transition of Rincon/South Beach from wealthy to working-class had begun.

It’s difficult now to imagine Rincon Hill not only as a residential neighborhood of free-standing mansions but also as an actual hill. In fact, it was once 120 feet tall. The Second Street cut started a process that eventually leveled it.

Following this, Rincon, South Beach and the South End (which was from conception a waterfront neighborhood of warehouses and docks) spent the next century as blue-collar places of work. The latter neighborhood, bounded by Harrison and Townsend Streets, The Embarcadero and Fourth Street, is now a Historic District boasting “an extraordinary concentration of buildings from almost every period of San Francisco maritime history.”

The Southern end of South Beach also contains a game-changer for the entire district: AT & T Park. After several years of flirting with other sites, including the railroad yards at Seventh and Townsend Streets, the San Francisco Giants broke ground for their new stadium at King and Third Streets in 1997, transforming sleepy South Beach into a vibrant neighborhood of middle- and high-end apartments and condos, restaurants, bars and shops. On game days, Second and Third Streets teem with baseball fans. Hot spots like MoMos and Pete’s Tavern overflow with patrons wearing black and orange.

This end of South Beach was created in a manageable scale, mixing mid- and high-rise blocks with The Embarcadero’s open space and breathtaking bay and bridge views. Not so the rebirth of Rincon Hill. The northern sector of South Beach, was developed after the southern end and chose a flashier approach more in keeping with its proximity to San Francisco’s Financial District. The new Rincon features spectacular residential towers, world-class restaurants, street-level buzz and a seemingly non-stop appetite for growth and action.

In some ways, Rincon seems an outgrowth of neighboring Yerba Buena, with an emphasis on full-service residential communities and a “live here/work here” ethos. It features high-end and boutique hotels and has a subtle ace up its sleeve – easy access to San Francisco’s ferry building and ferry docks. Other than Yerba Buena it’s difficult to imagine a more Manhattan-like neighborhood in San Francisco – or one presently showing more obvious signs of future growth. Two corners of the intersection at Folsom and Beale Streets, for example, sport large-scale construction efforts in their early stages.

But South Beach is more than Rincon, its towers and its cranes. South Beach is also South Park’s quiet central park, King Street’s exciting commercial strip, The Embarcadero and everything in-between. The signature One Rincon towers, visible from all over the city, make Rincon hard to ignore, though. To be certain, the San Francisco Association of Realtors knew what they were doing when they gave South Beach its own designation. The only question is if they went far enough.

Source: Parascopesf.com

Yerba Buena: Part 2

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YERBA BUENA REAL ESTATE MARKET

It’s not exaggerating to say that Yerba Buena has one of San Francisco’s most exciting, dynamic real estate markets. The district’s many rebirths have left it with housing options tailor-made for the city’s upwardly mobile – and those who’ve already reached the top.

After decades spent as a mirror image to SoMa – transient-oriented housing mixed in among light industry and warehouses – and a long and tortuous lead-up to redevelopment, Yerba Buena began its latest (and ongoing) period of evolution in the 1980s. Early development again mirrored that of SoMa: one- and two-bedroom apartments, condominiums and lofts, the difference being that Yerba Buena’s builders favored large-scale projects, like the string of mid-rise residential buildings on the 700 and 800 blocks of Folsom, including 737 Folsom Street and Museum Parc (both built in 1988) and the Yerba Buena Lofts (built in 2001).

Along with the SoMa Square apartments on Third Street, these early projects established Yerba Buena as a lively, high-density urban neighborhood offering spacious (if not enormous) living spaces and, in some cases, private outdoor living spaces in mid- to high-range buildings. All had one thing in common: proximity to the Moscone Center and Yerba Buena Gardens, landmarks that continue to act as the heart of the neighborhood.

Yerba Buena’s next growth period came on the heels of the 1990s economic explosion, bringing with it demand for different – read “high-end” – living. The first decade of the 21st century was an evolutionary time for Yerba Buena, as high-rise developers began to target the neighborhood. This time they built on the blocks closest to San Francisco’s Financial District, mixing full-service luxury residential towers like Blu (631 Folsom Street), the Paramount (680 Mission) and the industry-leading Millennium Towers (301 Mission, named one of the top 10 residential buildings in the World by Worth Magazine) with ultra-chic combo hotels/fractional ownership concerns like the St. Regis (125 Third Street) and the Four Seasons (757 Market Street). These buildings include lavish penthouse units and amenities like 24-hour doormen and 24-hour concierge service, on-site fitness centers, conference rooms, swimming pools and rooftop decks.

The last tower built during this wave was One Hawthorne, which began selling units in 2010. At the time it seemed that high-profile development in Yerba Buena – in all of San Francisco, in fact – was on indefinite hiatus due to the economic downturn. Instead, the economy roared back to life, and with it growth in Yerba Buena.

There are presently a number of large-scale residential and commercial projects either proposed, pending or under construction in Yerba Buena, including a combination condo high rise/Mexican Heritage Museum at 706 Mission Street, a new 15-story Hampton hotel at 942 Mission and a significant expansion of the Moscone Center.

Despite the upscale character of Yerba Buena’s latest wave of growth, the neighborhood is of late sharing its ultra-high-end crown to its neighbor to the east, South Beach. The latter features a collection of San Francisco’s most luxurious towers including the One Rincon Hill complex, the Metropolitan and the Infinity. Yerba Buena definitely has its share of significant skyscrapers but also a number of mid-level living options (a recent check of the MLS showed available Yerba Buena units ranging in asking price from $499,000 to $3.85 million), creating a neighborhood of varying scales, where residents do more than simply drive into a garage, take an elevator up 30 stories and stare out at the streets below. There are many ways to “do” Yerba Buena, with its central green space, its museums, its restaurants, shopping and lively workweek presence. It is a true city neighborhood.

Source : Parascopesf.com

Yerba Buena: Part 1

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When the San Francisco Association of Realtors redrew their city map in 2010, they split SoMa into two districts: one still known as SoMa and another, bounded by Fifth Street to the west, Second Street to the east, Market to the north and Harrison to the south. The new district was given the name “Yerba Buena” after its centerpiece, Yerba Buena Gardens.

While some bristled at the idea of giving a new name to what had been half of SoMa for decades, the reality is that Yerba Buena had been a distinct neighborhood since even before 1966, the year the San Francisco Redevelopment Agency (SFRA) designated it as an urban renewal area.

According to the book “Transforming Cities: New Spatial Divisions and Social Transformation,” the birth of modern Yerba Buena dates back to 1953, when developer Benjamin Swig “put forth his redevelopment proposal for the area in his plan entitled The San Francisco Prosperity Plan.” Swig’s specific vision did not ultimately come to light, but portions of it were adopted into the SFRA plan several years later.

Redevelopment did not come easily to Yerba Buena. The plan faced strong neighborhood opposition and went through a series of community-driven tweaks. It wasn’t until 1981 that the first sign of its first implementation, the Moscone Center, was realized and the early 1990s before Yerba Buena’s building boom was in full effect.

Now that it has been christened a “real” neighborhood, Yerba Buena seems determined to establish itself as one. In the past 20 years it has become perhaps the most urban of San Francisco’s urban neighborhoods, with high-rise office and residential towers, luxury hotels, large mid-rise condominium complexes and several of the city’s most dynamic museums, including SFMOMA, the Contemporary Jewish Museum, the Museum of the African Diaspora, the Yerba Buena Center for the Arts and the Cartoon Art Museum.

Yerba Buena is a neighborhood with varied personalities. Close to Market Street it’s an extension of San Francisco’s Financial District. Weekday mornings find its sidewalks clogged with workers, conventioneers and visitors (the district contains a number of hotels including the W, the Westin, the St. Regis, the Intercontinental, the Marriott Marquis and the ultra-high-end Four Seasons). Further from Market it more closely resembles SoMa, with light industry and warehouses, some hiding ambitious restaurants and tech start-ups.

Despite its proximity to the city’s business core, Yerba Buena is a true “mixed-use” neighborhood, offering mid-level and high-end housing within steps of some of the city’s most significant office buildings. On sunny days, workers and residents gather in the district’s hub, Yerba Buena Gardens, for impromptu picnic lunches, brown-bagging it with something from the Whole Foods on Fourth and Harrison or perhaps grabbing something to go from a nearby restaurant, maybe at one of the newly-opened places in the rehabbed Metreon center. The more adventurous can stroll over to Fifth and Minna Streets, where food trucks set up for Off The Grid several times a week.

Yerba Buena Gardens is not only a playground for adults; it also adds a family-friendly element to this bustling urban district. It features a large playground, a bowling alley, ice-skating, an outdoor amphitheater and the Children’s Creativity Museum. The seasonal Yerba Buena Farmers Market and the annual Yerba Buena Festival promote community togetherness and add to the neighborhood’s personality… as if it needs it.

It’s got a new name, new buildings and an optimistic vibe but Yerba Buena still allows peeks into its past. Pre-war buildings dot the landscape, some containing long-time local businesses like Adolph Gasser Photography (181 Second Street since 1950), others high-profile tech concerns like Yelp (the 1925 Art Deco Pacific Telephone Building – once the tallest in San Francisco — at 140 New Montgomery). Small businesses still have their place in Yerba Buena.

It’s appropriate that Yerba Buena, in reality a longtime established neighborhood, now wears a shiny new name. It is growing as fast as any other district in San Francisco, its persona changing a little with each new project. As a center for culture, business and a buzz-worthy lifestyle, there’s not much in San Francisco that can compete.

Source : Parascopesf.com