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SF buys South Van Ness site, turning it from market-rate to affordable housing
J.K. Dineen
June 11, 2019 Updated: June 11, 2019 4 a.m.

A Mission District property that was at the center of a fight over neighborhood gentrification will become the site of 100 percent affordable housing now that the city has agreed to buy the parcel for about $18.5 million.

The Mayor’s Office of Housing and Community Development is in contract to buy 1515 South Van Ness Ave., a former electrical contracting warehouse that had been on track to be replaced by market-rate apartments. Instead, the property will now accommodate about 150 housing units affordable to low-income families . . . .

Along with the so-called “Beast on Bryant” and “Monster in the Mission,” 1515 South Van Ness Ave. — detractors called it the “the Mess on South Van Ness” — was targeted by activists who argued that upward pressure from market-rate development leads to displacement of low-income residents and the businesses that serve them.

Eventually developer Lennar Multifamily was able to win political support by agreeing to make 25 percent of the units affordable, creating discounted space for artists and makers and contributing $1 million to a cultural district formed to preserve the neighborhood’s Latino heritage and community.

But the concessions, combined with rising construction costs, eventually made the project so costly that it no longer made sense for the developer, according to market sources. Instead of breaking ground, Lennar decided to sell.

San Francisco construction costs are up more than 50 percent since 2015, and recently edged out New York City as the highest in the country. A unit of affordable housing costs between $600,000 and $800,000 to build, depending on building type and materials . . . .

The project is the eighth affordable housing site that San Francisco has acquired over the past four years in the Mission District, which consistently has had one of the city’s highest eviction rates. Combined, the projects will bring more than 1,000 affordable units to the neighborhood. Projects already under construction include 157 units at 1950 Mission and 143 units at 1990 Folsom St. . . . .

The project will likely require about $45 million in city funds. The money would come from the housing bond, most likely to be for $600 million, slated for the November ballot. If the bond passes, the project would start in about three years. If it doesn’t pass, it may take longer . . . .

Mission District market projects that have been approved and then put on the market before construction started include a 75-unit development at a former laundromat at 2918 Mission St., and a 117-unit complex at 2675 Folsom St. from which developer Axis Development abruptly walked away after winning approvals in 2018 . . . .

https://www.sfchronicle.com/bayarea/...m-13966738.php