Economic impact report of establishing the Trinity Plaza Special Use District

2006·0.42 MB·English

by  San Francisco (Calif.). Office of the Controller. Budget and Analysis Division. Office of Economic Analysis

SANFRANCISCOPUBLICLIBRARY
1223 08678 9535
DOCUMENTS
DEPT.
Office of the Controller SEP 22
2
Budget and Analysis Division san
francisco
Office of Economic Analysis - public library
Economic Impact Report of
ing the Trinity Piaza Special Use District
File No. 061216
Features
i
byadding Section249.34toestablish theTrinity Plaza Special UseDistrict
mcisco PublicLibrary massing 1167 MarketStreet, 670 Stevenson Street, 693 Stevenson Street, 1164
on ofJessieStreetbetween 7thand 8thStreets,
ninates:
jrnment Information Center ons, allowingthe constructionof1,943,000gross squarefeetofconstruction the
Francisco Public Library hichfarexceedstheavailablesupplyofTransferable Development Rights
Larkin Street, 5th Floor idersection 124ofthe Planning Code.
Francisco,CA 94102 -unitdensitylimits,allowing upto 1,900 dwelling unit—sto bedeveloped, as
iRENCE BOOK itunoifts1,i4n1a8luontiwtsituhnadnerarPelaanonfin1g77C,o2d95esSqeucatiroenfe2e1t5.(a) which isthe maximum
Jacks, Separation, Open Space, Streetscape, and Parking restrictions codified in
the Planning Code.
e taken from the Library f
d sunlightaccess requirements topublicsidewalksand dwellings in the project
sectionsofthe Planning Code,
ction 309 processto reviewdevelopment,
wides:
ilopmentProject bytrading offheight, bulkand useconcessions inexchangefor
)ilitybydeveloperwith respectto CEQAfindings, General Plan Consistency
iiiiuinyo,oauoiaouon ofPlanning Code Section 101.1(b)findings.
Complianceand commitmentto Cityand CountyofSan Francisco("City")tenancyandjob-creation
policyobjectives including:
Acommitmenttotimelydeliveryoftheproject, tothe paymentofall necessarypermits,
developmentand impactfees.
Adoptionofaffordable housing policiesto increasetheavailabilityofon-site, below-market-
rate unitstostatutorily mandated levels.
Active participation orpromotion byTrinityProperties, Inc. ("ProjectSponsor")toJobs-
Housing Linkage, FirstSource Hiring, Equal OpportunityEmploymentandTraining, and
otherprograms.
September 21, 2006
37
t

DOCUMENTS
DEPT.
Office of the Controller
SEP 22
2C05
Budget and Analysis Division SAN
FRANCISCO
Office of Economic Analysis PUBLIC
LIBRARY
'
Economic Impact Report of
Establishing the Trinity Plaza Special Use District
File No. 061216
Proposed Ordinance Main Features
• Amendsthe Planning Code byadding Section249.34toestablishtheTrinity Plaza Special UseDistrict
("SUD")inthearea encompassing 1167 MarketStreet, 670 StevensonStreet, 693 Stevenson Street, 1164
Mission Streetand the portion ofJessieStreetbetween 7thand 8th Streets.
• The Special Use Districteliminates:
o Floor-area restrictions, allowingtheconstructionof 1,943,000gross squarefeetofconstruction the
projectrequires, whichfarexceedstheavailable supplyofTransferable Development Rights
(TDR")allowed undersection 124 ofthe Planning Code,
o Maximum dwelling-unitdensity limits, allowing upto 1,900 dwelling unit—sto bedeveloped, as
opposedtothe limitof1,418 units underPlanning Code Section 215(a) which is the maximum
numberofallowed units in a lotwithanarea of177,295squarefeet,
o Height, Bulk, Set-Backs, Separation, Open Space, Streetscape, and Parking restrictions codified in
varioussections ofthe Planning Code,
o Wind exposureand sunlightaccess requirements to publicsidewalks and dwellings in the project
codified in varioussectionsofthe Planning Code,
o Planning CodeSection 309 processto reviewdevelopment.
• The Special Use Districtprovides:
o FeasibilityofDevelopmentProject bytrading offheight, bulkand use concessions in exchange for
up-frontaccountability bydeveloperwith respectto CEQAfindings, General Plan Consistency
findings,satisfaction ofPlanning Code Section 101.1(b)findings.
o Complianceand commitmentto Cityand CountyofSan Francisco ("City')tenancyandjob-creation
policyobjectives including:
Acommitmenttotimelydeliveryoftheproject, tothepaymentofall necessarypermits,
developmentand impactfees.
Adoptionofaffordable housing policiesto increasetheavailabilityofon-site, below-market-
rate unitstostatutorily mandated levels.
Active participation orpromotion byTrinityProperties, Inc. ("ProjectSponsor")toJobs-
Housing Linkage, FirstSource Hiring, Equal Opportunity EmploymentandTraining, and
otherprograms.
September 21, 2006
Page 1
Executive Summary
Qualitative Net Benefit Ranking
Stakeholder
Extreme Moderate Moderate Extreme
adverse adverse Neutral favorable favorable
impact impact impact impact
City Economy
Trinity Plaza
Owner/Developer
Trinity Plaza
Tenants/Visitors
City Government
Establishing the Trinity Plaza Special Use District:
• Expedites the development process that allows for a higher and better use of the four affected parcels.
This raises property values for the new development and for neighboring parcels, enhancing the asset
value ofproperties in the area nearthe proposed development.
• Expands the net useable floor-space over three major structures that connect the project to the
surrounding land uses, parcels, streets, traffic patterns and transit systems. Temporarily helps to
mitigate excess demand for housing in the City with the addition of 1,523 dwelling units to the housing
stock, which contributes to affordability by lessening the upward pressure on housing rents and prices
in the market.
• Exempts Trinity Plaza's transformation from a more costly (section 309) review process, enabling
stakeholders to channel their energies and efforts toward expediting all phases ofthe development, and
mitigating burdens and costs to current tenants as they transition to the newly developed units. This
allows for an orderly process in which tenants' rights and risks are protected and mitigated,
respectively. The tradeoff is an expansion in dwelling unit count, in space for more profitable retail
activity, jobs and site access. In pursuing an alternative path to development, the Special Use District
Ordinance does not circumvent any fundamental legal requirement forthe developer.
• Provides opportunities for improving economic vitality of the neighborhood, including retail jobs in the
proposed retail space expansion.
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• Receives developercommitments to concessions and requirementswhich include:
o Compliance with the California Environmental QualityAct (CEQA),
o Adoption of change of use findings consistent with the General Plan1 specifically with
Planning Code Section 101.1(b)2 ,
,
o Commitmentto the DevelopmentAgreement (see File No. 061217) that:
Replaces 360 rent-controlled units and avails tenants with lifetime leases for these
units,
• Creates up to 1,523 additional dwellings, including additional below-market-rate
units per minimum required by the Planning Code as of the effective date of the
agreement,
Expands off-street parking from 50 to 250 spaces,
Expands tenant parking from 400 to 1,200 spaces, including Car-share3 spaces,
Expands retail space from 12,000 square feetto 60,000 square feet,
Creates a project site that is more complementary to the sites, streets and traffic
flow around it,
Expands on-site provision of tenant and public community-building amenities such
as stores, restaurants, gyms, playground areas, outdoor and indoor open-access
and restricted-access leisure areas, and
Mandates that replacement units be subject to the City's Residential Rent
Stabilization and Arbitration Ordinance (Chapter 37 of the San Francisco
Administrative Code) forthe life ofthe buildings.
1 Referto Planning Commission Resolution No. 17293foracompletelistingofHousing,Transportation, Urban Design,and Downtown
Area Plan Elementsthatarefavorablyimpacted bythe proposed DevelopmentAgreementandthatwould befurthered bythe proposed
Special Use District.
2 (a) That existing neighborhood-serving retail uses be preserved and enhanced and future opportunities for resident employment in
and ownership of such businesses enhanced; (b) That existing housing and neighborhood character be conserved and protected in
ordertopreservethe cultural and economicdiversityofourneighborhoods; (c)ThattheCity's supplyofaffordable housing be preserved
and enhanced; (d)ThatcommutertrafficnotimpedeSan Francisco Municipal Railway(Muni)transitserviceoroverburden ourstreets or
neighborhood parking; (e)That a diverse economic base be maintained by protecting our industrial and service sectors from
displacement due to commercial office development, and that future opportunities for resident employment and ownership in these
sectors be enhanced; (f)That the City achieve the greatest possible preparedness to protect against injury and loss of life in an
earthquake; (g)Thatlandmarksand historicbuildingsbe preserved;and, (h)Thatourparksand open spaceandtheiraccesstosunlight
andvistas be protectedfrom development.
3 Car-share is a membership-based transportation service. A member reserves a car from any one of the 46 City locations, or 14
locationsthroughout Berkeleyand Oakland,where cars are parked orstored. The member pay's an hourlyand a mileage fee to use a
vehicleforanytransportwantorneed ofthe member. Please referto http://www.citycarshare.org/fordetails.
Page 3
——
Economic
Ordinance Passes Status Quo
Scorecard
Neutral to Moderately Favorable Impact. Market rents and prices
The proposed Special Use Districtfavorably impacts the continue rising as a result of
City's landscape and economy by enabling the the limited housing stock
implementation of the estimated $300 million available for prospective
Development Agreement that would create needed tenants/occupants.
—
Citywide additional housing stock approximately 1,900 total The excess demand for
Impact units, including 1,523 net addi—tional dwelling units, and dwelling units manifests as
377 replacement rental units short-term construction higher housing costs, which
jobs, and sustainable service and retail jobs. The stunts job creation in low-to-
proposed development appears to be suitably matched mid-wage sectors because it
to the building landscape of the parcels it may occupy puts upward pressure on
upon completion, thus generating urban economicvalue workforce creation costs
in the district, and to the City. wages.
Moderate to Extremely Favorable Impact.
The three-building, 1,900 residential dwelling unit
Apartment vacancies would
complex with 60,000 square feet of retail spac—e, and decline below the natural
nearly 92,000 square feet of usable open space some
— vacancy rate citywide, as
space publicly accessible, other for tenants only is employment increases
nearly five-fold the existing amount of actively used intensify demand for
Trinity Plaza residential and retail space in the four-acre site. residential space. The
Owner In return for zoning, permit and development-review intensified housing crunch
/ process concessions, the owner/developer will build would manifest itself in the
Developer affordable housing units on site, provide for tenant and form of abruptly increasing
public parking, and comply with Jobs-Housing Linkage rents and prices for market-
Program requirements, Transit Impact Development rate dwellings, making it
Fees, First Source Hiring Program, and the Equal even more challenging to
Opportunity Employment and Training Program. promote the building of
Furthermore, the owner will commit to concessions affordable housing units.
regarding the moving of tenants, generous tenancy
rights and lenienttenancy dispute procedures.
Moderately Favorable Impact. The 377-unit property with
Existing tenants will bear no moving costs to new 450 parking spaces, a
residential units with better amenities than existing restaurant, and mismatched
units, with more efficient floor plans and at least equal land use to adjacent existing
square footage to theircurrent unit. and prospective
Tenants may be affected during the construction developments remains as is.
process by added noise, parking and traffic Rents will continue to rise for
Trinity Plaza inconveniences. depreciating fixtures and
Tenants Prospective and existing tenants would enjoy the amenities in property
/
Visitors. availability of a substantially greater number of housing regardless of maintenance.
units that would affect market rents and prices, and Rental properties have a
updated functionality in new community facilities that tendency for what is referred
include gyms, open outdoor space, inviting lobbies and to as "filtering down" over
gathering areas, and greater access to more retail time.
serviceswithin the facility's 60,000 square feet ofspace. Consequently, even with
Visitors to the neighborhood will have access to more non-increasing monetary
parking and amenities, such as restaurants, in a more rents, tenants get "less for
attractive and pleasing environment. their money".
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Economic
Ordinance Passes Status Quo
Scorecard
Neutral toward Favorable Impact.
The net increase of 1,523 quality dwellings will
temporarily relieve upward pressure on prices for
ownership and rental property. In turn, this will improve
residents' living standards, job opportunities, and
promote the Central Market Street area's economic
revitalization.
The net addition to the housing stock will not only City continues to collect
City current revenues, including
provide for greater developer impact fees, permit fees
Government and higher property tax revenues (going from approximately $150,000 in
approximately $150,000 to $3 million assuming a $300 property taxes.
million assessed value, where the General Fund
accrues 57% ofthis revenue), and also the potential for
greater sales, utility user tax and transfer tax revenues.
Additional spillover effects also include greater use of
mass transit by visitors and residents to the area and
adverse impact in terms oftraffic congestion due largely
to off-streetparking.
Risk Factor Schedule
Risks Possible mitigating actions
Amend the Development Agreement to include
Both affordable rental and owner-occupied housing conditional guarantees that most units will remain a
stock is in short supply in San Francisco, and as part ofthe City's rental housing.
currently structured, the Development Agreement
provides no guarantee that up to 1,540 of the units OR
built will remain rental units for their useful life, nor
be subjectto rent controls. The developerwill likely Require that the developer to pay higher
find it4more profitable to sell rather than rent these development impact fees in lieu of having to pay the
units. market value of TDRs necessary to build up to
1,943,000 sq. ft., ifunits are to be sold.
Without the granting of rights to build off-street
parking that c—omplements the proposed Aofllotwhe250Deovfef-lsotpremeetnptarkAignrgesepmeancte,s foarnvdisictoolrsleacts ptahret
commercial space 60,000 square feet of retail
sesptaacbelischonmseinsttsi—ngsupcrhimasrpialyceofmahyospniottalibtey fseearsviibcley ciomrprleesmpeonntdingpoltircaifefisc itmhpaatct mdietvigealtoepmenthte feetrsafftioc
consequences.
built.
Supply constraints of housing continues to be one of the significant factors contributing to the high cost of living and
doing business in the City- one ofthe highest in the nation. This increases the economic risks associated with slower
jobgrowth.
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Appendix: Information on Proposed Trinity Plaza Development
Proposed
inniiy riaza rroject uescnpnon oiaius uuo ucveiuprneni
(Up to)
unit count ill ,»uu
I
Rent-Controlled (must remain as rental) 360 360
Market-Rate
17 1,255
(nrnno^pH conlri hp rpntal orownprshin^
InclusionaryAffordable Housing Program 285
(rental orownership)
Parking Spaces 450 1200+250*
Tenant 50 1,200
Public 400 250*
Square Footages
LotSize 177,295 177,295
FloorArea RatiosAllowed, Multiples ofLotSize
Existing - 400,000
General Plan, Planning Code Section 124, 6:1 1,063,770
With TDR under Planning Code
1,595,655
Sections 123 and 128, 9:1
Proposed, -11:1 1,943,000**
Commercial Space* 12,500 60,000*
Usable Open Space ~0 91,878
120-X, 150-X, 160-X, 180-X,
Height and Bulk District AND 240-S AND 240-S
Details on Other Exemptions from Planning Code Restrictions, and Developer
Concessions can be found in the Development Agreement and othersupporting Planning
Commission documents.
* Ifpublicparking is notavailable, then commercial spacedevelopment maynot befeasible.
** This can only be accomplished if the developer purchases 879,230 TDR units, which exceeds the
inventory ofavailable units ofTransferable Development Rights in C-3-G Districts. Creating this proposed
Special Use Districtis the most practicalwaytoenablethe developmentofthis project.
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