Category Archives: San Francisco

Supervisor Campos’ Strategy for the SF Housing Crisis: Mission First

mission

Supervisor Campos is receiving a lot of press lately for his unconventional position that may be heading to the ballot this November. In an effort to mitigate displacement of rent-controlled tenants in the Mission District, and address the SF housing crisis generally, he is aiming to impose a moratorium on market-rate housing developments in the Mission.

According to the San Francisco Business Times, Campos and his camp have a counterintuitive view of the affect of market-rate housing in the Mission. Of course more housing means less pressure on pricing. But they say “demand for housing in the Mission is so high that increasing supply will never push down prices. It only raises property values near new development, ripening the appetites of developers looking to make a bundle from developing more high-end condos and apartments”. In other words, gentrification is a domino effect.

Campos has plenty of political momentum on this issue. The SF Examiner reports 65% voter approval for a one-year moratorium, based on a recent poll. Last week, a mob of supporters flooded City Hall to demand a dialogue with Mayor Ed Lee, and apparently wanted him to declare a state of emergency to halt evictions in the Mission.

Even with all this energy, Campos’ measure could have a branding problem at the ballot box: he’ll need to convince all the voters who don’t live in the Mission that less housing means lower prices. This is a difficult task, to be sure – especially when his own colleague, Supervisor Weiner, thinks “his moratorium is an awful idea”.

Economics aside, the goals of this effort may also a bit ironic. Existing development policy generally requires builders to create a certain number of inclusionary units. While Campos hopes the moratorium will buy time for the Planning Department to modify its inclusionary housing policy, others, like Edwin Lindo of the San Francisco Latino Democratic Club, apparently envision a market solution to emerge from the frozen market: “Our goal is not to stop all development. Our goal is to stop incredibly large development that focus exclusively on market-rate housing . . . We need a pause to ensure that if developers are going to build in our city they’re going to figure out a way to build affordable housing, even if that could be cutting into their 15 to 20 percent profit margins”.

facebooktwitterredditlinkedinmail

San Francisco, Number One! (in Rents)

SocketSite.Logo.290x62

We did it, you guys… We’re still on top. SocketSite reports a record-setting asking price for apartments in San Francisco, as of first quarter 2015, of $3,458 per month. San Francisco renters may have reasons to be optimistic though. The rate of increase appears to be slowing (at least compared to rates in Oakland), and new construction projects should cause prices to at least flatten out eventually.

facebooktwitterredditlinkedinmail

San Francisco Lawmakers “Sharing” in the Task of Amending the New “Airbnb Law”

sfc-sfgate-logo

Mayor Lee and Supervisor Farrell introduced an amendment to the new “Airbnb law” this week. Currently, an overloaded Planning Department has been charged with regulation of Airbnb (and other short term rental) listings. This comes on the heals of another amendment proposed by Supervisors Campos and Kim, and mere months after the original ordinance took effect.

The Lee/ Farrell amendment would create a new office, the Office of Short-Term Rental Administration and Enforcement, which, as the name suggests, would be able to focus more singularly on this type of housing use, which The Chronicle estimates to affect 5,000 homes in the City for Airbnb listings and another 1,200 for VRBO.

Meanwhile, Airbnb CEO Brian Chesky appeared on APM’s Marketplace this week and explained that Airbnb’s own studies show that Airbnb either has no impact or a de minimis impact on rental prices and that it is actually allowing people to stay in their homes… so no one has anything to worry about.

The amendment would also increase the limit for allowable listings to 120 days per year, up from 90 in the existing version.

facebooktwitterredditlinkedinmail

Senator Leno Gets Second Vote on Second Attempt to Curtail Ellis Act Evictions in San Francisco

california state seal

Senator Mark Leno presented SB 364 to the Senate Housing Committee today – his second effort to impose “anti-speculator” restrictions on Ellis Act withdrawals in San Francisco. Busloads of San Franciscans, on both sides of the issue, headed to Sacramento to share their opinions. Ultimately, the 6-5 vote against SB 364 maintains the status quo in the City, pending reconsideration, where the housing committee will hold a second vote (so stay tuned).

Leno’s SB 364 would add provisions to the Ellis Act providing that, in order to invoke the Ellis Act to “go out of the rental business” an owner would need to own the property for “five continuous years or more”. It would also provide that an owner who even initiated an Ellis Act withdrawal for one building could not do so for a subsequently-acquired building for another ten years (forcing owners to really stand behind the statement, “I don’t want to be a landlord”).

facebooktwitterredditlinkedinmail

San Francisco Board of Supervisors Supports Senator Leno’s Ellis Act Restrictions

city hall

San Francisco Board of Supervisors passes legislation supporting SB 364 – Senator Mark Leno’s second effort to impose restrictions to the use of the Ellis Act to withdraw residential rental property from the rental market. (Among other things, the law would require that a landlord first own the property for five years before seeking to “go out of business” as an “anti-speculation” measure.)

facebooktwitterredditlinkedinmail

Sinbad’s Waterfront Restaurant Expected To Close March 21st

sf examiner

The SF Examiner reports that Sinbad’s restaurant, a decades’ old waterfront icon, may soon serve its last shrimp cocktail. The restaurant’s landlord, the Port of San Francisco, is expecting the restaurant to vacate by March 21, 2015, as the San Francisco Bay Conservation and Development Commission plans to demolish Pier 2 that month, allowing construction to expand the ferry terminal in 2016.

That is, unless the Stinson brothers – the restaurant’s owners – are successful in evoking the “no harm, no foul” doctrine, to continue operating until the City breaks ground on construction.

Charles Stinson was also briefly involved in an attempt to reopen a restaurant in the San Francisco historical landmark, Julius Castle, at the top of Telegraph Hill. That effort resulted in, among other things, the decision Julius Castle Restaurant Inc. v. Payne (2013) 216 Cal.App.4th 1423, where the First District Court of Appeals analyzed fraud in the inducement of commercial lease agreements.

facebooktwitterredditlinkedinmail

Federal District Court Overturns Enhanced Ellis Act Relocation Payments

rent board logo

Last week, the United States District Court for the Northern District of California invalidated an amendment to the San Francisco Rent Ordinance requiring an increase to the existing relocation payments owed to tenants in non-fault evictions pursuant to the Ellis Act. The new, enhanced payments were calculated based on market rate differentials – the difference between the tenant’s rent-controlled rental rate and the cost of a comparable unit on the open market. In some cases, this number reached six figures per unit.

Finding that the new law constituted a monetary exaction, prohibited under the Takings Clause without the payment of “just compensation”, Judge Breyer found that there was no “essential nexus” between the right to change the use of property (i.e., to no longer allow rentals) and there was no “rough proportionality” between the costs a displaced tenant faced on the open market and the direct consequences of a decision by the landlord to go out of the rental business. (By contrast, challenges to the previous relocation payment scheme, requiring a payment based on the cost of first months’ rent, last months’ rent, and security deposit at a new rental unit, have been upheld as comporting with the Ellis Act.) The City is expected to appeal the decision to the 9th Circuit.

facebooktwitterredditlinkedinmail