SF must build taller and expand into western neighborhoods, says report

San Francisco wants to build more housing. But how and where will it happen?

The San Francisco Planning Department’s critical “San Francisco Housing Affordability Strategies Report” for 2020, marked for publication this week, lays out three likely plans to hit SF’s housing goals—at least some of which are liable to touch a nerve.

The city compiled the report with the goal in mind of creating 150,000 homes (including 50,000 affordable homes) by the year 2050. That’s almost twice the rate of development compared to the past ten years, for the record, so it’s no mean stretch.

Here’s what SF Planning has to say about the state of housing right now, and what it identifies as the three most likely ways to change it.

• SF is building more housing lately, but not much relative to the recent past. From 2000 to 2009, the city averaged 2,302 new homes per year, and from 2010 to 2019 that number bumped up to 2,509. However, that spike of a few hundred homes per year was not sufficient to keep up with job and population growth.
• Affordable housing production ramped up during that time, but also not by much, from 623 units per year in one decade to 692 in the next. Most critically, the report points out “affordable and market rate production tend to rise and fall together, in part because market rate housing funds affordable” and in part because the state of the general economy governs both the same way.
• Between 1990 and 2015, the number of SF households making 120 percent or more of the area median income (AMI) increased by 80,000, while at the same time the number of low- and moderate-income households declined by over 29,000. SF Planning reiterates that residents of color are “far more likely to be low- or moderate-income than white residents” and this magnifies the effects of housing shortfalls in some communities.

• SF Planning singles out three potential solutions, starting with the so-called “east side focus,” in which the majority of new homes would be built in neighborhoods on the east side of the city close to downtown and along the waterfront, stretching down to Hunters Point, whereas “growth on the western two-thirds of the city would be limited to a few large projects.” To create sufficient density in roughly one-third of the city, SF would have to build taller, between 10 and 24 stories in areas close to jobs and transit. The biggest drawback of this plan is it’s pretty close to what the city is doing already, meaning it’s more likely to exacerbate existing problems.
• With the “transit corridors” plan, new development would focus on major transit lines, and in turn “these lines would receive significant investments to accommodate additional ridership.” This would spread new development across a wider geographical area—most notably well into the west side thanks to the L and N Muni lines—but narrow its focus to the point that the effect on most of the neighborhood would be minimal. Planning argues that since “displacement pressures are already widespread in the city,” the hazards for existing residents are real but largely already accounted for.
• Finally, the “residential district growth” plan forgoes the sacred cow by suggesting that the city should focus on building more homes in neighborhoods where the number of homes allowed is currently “very limited,” including the 70 percent of space that limits zoning to single-family homes or duplexes—e.g., western neighborhoods like the Outer Sunset. The report argues that while this would mean the most widespread change, the sheer amount of space to work with means “reducing concentrated neighborhood change.”

A combination of all three approaches may also hit the targets. Note that while all three of these plans are projected to produce the desired amount of units, they all rely on the 40,000 additional units already in the pipeline that the city expects delivered during that time.

Right now the city’s budget for housing is shy what it would take to spur more affordable housing growth, with the report estimating an average $517 million price to generate 1,000 new homes and preserver 1,100 existing ones.

“The city is projected to nearly meet that funding need in FY19/20 but has fallen short in the past,” the report notes, suggesting that more money from things like housing bonds and the gross receipts tax that’s still tied up in court will be needed for more in the future.