Redeveloping Bayview-Hunter Point: To Keep or Get Rid of Affordable Housing?

Currently there is some noise being made about the redevelopment project of Bayview-Hunters Point in San Francisco, which is a state owned development area of affordable housing. The area is not flourishing and many of the buildings occupied by tenants are falling apart. This has resulted in the San Francisco Housing Authority to come up with a redevelopment plan called SF Hope. To be able to fund the whole project, the government has elected to go ahead with both private and state funded development. Unfortunately, this has created controversy on how much of this new project should be for market-rate homes versus affordable housing. Although this project will not be able to succeed without the private development taking a large portion of the plan, it is necessary for the builders to be willing to address the issue of enough affordable housing, because it is in the best interest of the community and they still stand to make a large amount of money.

Right now one of the private companies, John Stewart Co. has pledged to build 267 public housing units along with 90 affordable housing rental units, as well as more than 300 market rate homes. These homes would be priced between $600,000 and $800,000. The ground breaking of this project has been scheduled for next year. Another private company Lennar Corp. is seeking to remake part of the area with new homes, industrial and commercial space, 400 acres of parkland, shops and a new 49ers stadium. Lennar Corp. has also made a pledge to the lower income community and said "25 percent of the project's housing 8,000 to 10,000 housing units would be priced below market rates". They have also offered to completely rebuild the Alice Griffith public housing development (which is pictured here to the right).

The issue at hand is that many people believe that half of the new homes being built should be rented or sold at below the market rate to keep it affordable. These people rallying for affordable housing have gained enough support with the backing of Chris Daly who is the Supervisor of District 6 to bring this issue to San Francisco's June Ballot. The developers feel that if passed this will kill the whole project and ruin the redevelopment plan of Hunters Point. Daly is making the claim that "If we don't set aside a significant percentage of that land to be affordable for everyday San Franciscans, then lets be honest with ourselves, 20 years from now everyday San Franciscans aren't going to live here". What he is referring to is a need to keep the housing affordable to people earning 30 to 80 percent of the city's median income, which is equivalent to $64,267 for a family of four. I believe that this is a true assessment of the situation and the government needs to realize it is the best interest of the citizens. His other argument is that these companies are going to make hundreds of millions on this redevelopment if it goes through and that they can afford to help out the people by creating more affordable housing for the average citizen.

Another argument against the current position of the redevelopment is stated by Ms. Fleming a 60 year old grandmother who has lived there since she was nine, "They're finding all kinds of reasons to put us out of here". At one of the buildings 110 of the 267 units are already boarded up and the city is putting pressure on the remaining families to be evicted. This is arising from circumstances such as being late on rent or according to the evicted tenants the city is trying to find other reasons to have them removed. The issue is that the city and developers say they will be creating the subsidized units along with the market-rate homes, but the people who are now living in this affordable housing feel that they will never get a chance to move back into them after the redevelopment (a concept of what the projected area will look like pictured to the left). Currently most of the tenants in one of the buildings are paying the Housing Authority between $100 to $400 a month. These are people that can barely afford that and according to the Housing Authority this apartment complex owes $200,000 in back rent. Truly, the community does not believe that they are going to have no place to live once this project is underway as well as when the affordable housing is done, if it is not brought up to half of the total of what is built.

In my opinion, this is a very interesting situation. I feel for these people and their situation, as well as the private developer who tries to gain the largest profits possible. This is not the best neighborhood and the redevelopment is necessary, but this ballot should still be passed. If it is not, all they are doing is getting rid of the minorities in that area and making it more difficult to live in an already over priced area. The profit margin will still be high enough with 50% of the housing being priced at market-rate and by keeping the other at an affordable range it only helps maintain the community as a strong and well rounded place. It seems like the city has good intentions but at the same time they need to make sure that they do more to help out the average citizen. With the median family only making around $64,000 a year in San Francisco how can they expect these families to afford $600,000 to $800,000 homes. In addition to that the current tenants can barely make the $100 to $400 a month rent payment. San Fransisco is trying to take the most lucrative deal possible to help themselves since there is a lack of payment from the current tenants. Hopefully this ballot will be passed which would tremendously help the current tenants once the redevelopment has taken place.

Developers: Are They Over Doing It?

Just recently have I entered the blogosphere, but what I have found on real estate development has truly kept me intrigued. There is so much always happening in this field that it makes it enjoyable to search through blogs that offer up interesting insight on what is currently going on and soon to be underway. In my last post I talked about how the city has decided not to allow for the rezoning of industrial land for residential use. So I thought it was only fitting to talk about two projects in the Los Angeles area for residential use that have been under some debate lately. The first post "Westside Condo Project Promises More Gridlock, Disparity," is published by RedFin Los Angeles real estate agent Cindy Allen. Her post brings up the issue of plugging in more high rise luxurious condos in Century City and whether the market can withstand these super expensive buildings. The Second post "Conquest Banned For Even Thinking About USC Housing," was published by Dakota Smith the editor of Curbed LA. In this post she talks about the ruling by the courts to not allow Conquest housing to monopolize housing around the USC campus and allow for the University Gateway Project to move forward (a Conquest advertisement to the left). As one can see, there are projects going up all over Los Angeles meeting different types of needs for living, but there is always debate and issues revolving around every development. In the first post there will be additional talk about whether the market will continue to slow down. Where as in the second post, questions have been addressed about monopolizing the market so that other developers are unable to come into the area. Both are very prevalent issues and interlocking in many cases. I have offered my comments on each of these blogs below, as well as on the individual's blog.

"Westside Condo Project Promises More Gridlock, Disparity"
Comment:
First off, I would like to thank you for your interesting insight on this proposed project in Century City. As you stated, a 45-story 177-unit building in Century City that has been designed by French architect Jean Nouvel does not seem like the best option at this time (the shiny inserted building at the right). In my opinion, with slumping markets and the already over priced homes in Beverly Hills, I do not feel that "one of the most expensive residential buildings in the west" makes sense. The developers claim it will attract the European and Asian elite along with the rich Westside mansion owners to sell and move into a one of a kind building. Yes, maybe you will get a few ultra rich people to give up their mansions to live in a prestigious 30 million dollar condo, but I would not push the envelope. I agree with your assessment that this could potentially over build the market for the need of high end condos. Especially with the other nearby proposed projects of a 252-condo development on Wilshire Boulevard in Beverly Hills and the other two projects that make up almost 800-condos in Century City that have been proposed. With the amount these investors have paid for the land which seems to be between 400 and 500 million for each site, what will happen if they cannot find enough people to buy the condos? This could potentially add to the already huge problem with the market, creating a lot of losses. Do you see all these projects going forward in the near future or do you feel some of the investors will realize that there is just not enough market for these types of huge condo buildings at this time? I am all for development and luxurious condos but right now it seems like this could be a bad move on the developers part to believe that he can fill 30 million dollar condos with such an ease. Like you have suggested, I guess time will only tell.

"Conquest Banned For Even Thinking about USC Housing"
Comment:
Being a student at USC, I would like to thank you for your knowledge on the issue surrounding USC housing and Conquest. You have made it apparent to me that Conquest housing will no longer be able to hold a monopoly on current limited market of housing around the USC campus. As you state "A settlement reached today permanently prohibits Conquest Student Housing from interfering with housing projects near USC". This is a very big deal because the prices for apartments around USC are pretty absurd to have to be paying as a poor college student. As a student, I am paying 1,200 dollars a month not including gas or electricity. Allowing for these other projects to come into the areas, such as the Urban Partners project with USC to build the University Gateway, will help lower surrounding prices of apartments. It has not been a secret that Conquest has kind of taken over and kept other developers from being able to enter the area. You have made it clear that all law suits have been dropped by both sides, but if Conquest makes any missteps the Court has the power to impose sanctions. I was not aware that the Gateway Project is going to house 1,600 students and now I understand why Conquest was trying to interfere and litigate the development. Do you think that Conquest will continue to try and use unlawful actions to stop other developments from coming in or do you think that they will allow for things to take their course? It is understandable that they want to keep profit margin high, but to abuse the power is just not right. Along with that, do you think that prices for rent of apartments will change for the better or worse with the development of new buildings? Hopefully, as you state, the Gateway project is the first of many projects to help revitalize the area surrounding the USC campus.