Archive for November, 2006

Developer wants penthouses atop armory

In yet another turn in the saga of the never-to-be-anything-but-a-drug-riddled-homeless-encampment, the owner/developer of the Armory on the corner of 14th and Mission actually broke out his spreadsheet and realized that what he originally proposed to is no longer financially feasible. So he wants to be able to sell some high-end penthouses on the roof to cover the cost of the $10M retrofit.

From today’s Examiner,

The latest proposal for developing the long-abandoned armory at 14th and Mission streets calls for condominiums and penthouses, once again stirring controversy about what the old National Guard building should become.

This is not the first time the 123,000-square-foot armory is at the center of a gentrification battle. Since the National Guard abandoned the armory in 1971 about 10 proposals ranging from a movie studio to a church were offered up for the brick fortress that seems an impenetrable castle taking up the entire block of Mission Street at 14th Street.

In 2000, it became the focus of the Mission’s dot-com gentrification wars, with protesters flooding a Planning Commission meeting and arguing against a new-media office complex.

Now, Mission Armory Preservation Partners LLC aims to build 169 condominiums, including eight controversial penthouses, and roughly 30,000 square feet of office space in the 1914 armory that’s on the National Register of Historic Places.

In order for the latest proposal to pencil out financially, the penthouses must be part of the project, since they will help cover the costs of the restoration and seismic work that’s slated to cost upward of $10 million, said Brett Gladstone, an attorney representing the owner, Alpha LLC.

The penthouses would be set back from the edge of the roof, thereby creating a less obtrusive look, said Andres Grechi, design director for MBH Architects. [more...]

Imagine that… A developer that realizes that they can’t afford to do a project because of all of the restrictions placed on the property by our lovely Supervisors. Be sure to thank Chris Daly. He only lives a block away, and this is in his district (albeit right on the southwestern edge). He must like abandoned buildings in his neighborhood… Although I bet you could have already guessed that…

Developer wants penthouses atop armory [SFHomeBlog]
New life for the Armory, finally? [SFHomeBlog]
Another application filed to turn Armory into housing [SFHomeBlog]

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Maybe it's not over…

From an email sent by Rob Black’s campaign on Wednesday…

I’m writing to let you know that over 5,000 absentee ballots cast in the election for District Six Supervisor have not yet been counted by the Department of Elections.

It is highly likely that once the ballots are counted, no candidate for Supervisor in District Six will have received over 50% of the votes, and so the outcome of the race will be determined by instant-runoff voting.

This process may take several days. I will keep you updated as soon as new information comes in.

5,000 ballots? If you followed the election, you know that it was the initial absentee vote count that put Rob in the early lead, which was then overcome by the Tuesday voters. But if there are truly 5,000 uncounted absentee ballots, Daly has GOTTA be worried.

And I’m a bit optimistic (even though Chuck at the Chronicle Blog isn’t).

Because as long as I’ve been in SF, absentee voters have been strongly on the homeowner’s side of the measures that I cared about most (usually homeowner vs. the Tenant’s Union issues).

And don’t forget that Daly has never gotten more than roughly 6,000 votes (update: 6,645 votes in 2002)in either of his previous elections… Even if he gets 1,500 of those uncounted ballots (which would mean 1,000 more total votes than he got last time), he still loses in the end…

I would guess that most of the new voters in the district (read: homeowners) would rather push him into traffic than vote for him, and I would also venture to guess that a significant number of his previous voters have jumped ship. So that left his grassroots effort to get as many of his 6,000 constituents out to the polls on Tuesday.

Which he did quite well.

But it might not be over for Rob Black just yet.

Wouldn’t it be a sight to see Daly lose after the absentee votes and ranked-choice tally is complete?

His lovely wife may have spoken (and cursed) too soon…

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Board rejects Trinity Plaza deal

In a surprising move yesterday, the Land Use Committee (headed by McGoldrick and Maxwell — both Daly allies) and the full board shot down the chance for Trinity Plaza to move forward and instead suggested it go back to the Planning Commission. Did Daly broker too many deals on this one for even his own allies to stomach? McGoldrick wants MORE affordable housing than Daly could get?

From today’s Examiner,

The Board of Supervisors rejected on Tuesday a general plan amendment that would have allowed the development to move forward, pending other approvals.

“Some members of the board seem to be working to see if there’s other things that can be done,” Daly said after the vote. When asked if the board’s decision jeopardizes the development, Daly, who was up for re-election Tuesday, said, “I am going to get another four years on the Board of Supervisors and we will have this all worked out before you know it. But if I lose, then maybe.”

Supervisors Sophie Maxwell and Jake McGoldrick have spearheaded the push to hold up the development. The two sit on the Board of Supervisors Land Use and Economic Development Committee, which is charged with holding hearings on the proposed development before the full board can take a vote on it.

“I ask that you vote [the general plan amendment] down so that it can go back to the planning committee,” Maxwell said to the board members. “There have been sufficient questions raised about this huge project that I think it warrants more time.”

McGoldrick wants to see more below-market-rate units added to the project — 15 percent not the proposed 10 percent — and he also has suggested the developer pay for new open space in the area. The no-vote puts the development in “a holding pattern,” McGoldrick said. [more...]

It’s a sad day when even the the most hardened progressives on the board are going to fight over housing (after one of their own brokered the deal in the first place) and keep it from getting built. I thought this had all been worked out? Just think what an impact 1,900 units of housing could have on mid-Market. Nobody can argue that it would shift the supply/demand equation in favor of those who are looking for housing… Yet the board is still going to hold it up?

I really thought this was going to be an example of how to get housing built in the city. Sangiacomo (the project’s owner/developer) made some sacrifices, but those were enough to satisfy Daly. If there’s a housing project that Daly will approve, shouldn’t we expect that is the last hurdle? Has the ‘downtown money’ softened Daly? Or is McGoldrick not seeing his name in print enough anymore? He will be up for re-election in a couple of years… Never too early to start campaigning, I guess…

Board rejects Trinity Plaza deal [Examiner]
Trinity Plaza gets OK [SFHomeBlog]
Wealthy Developer Tries to Stop Rebuilding of Trinity Plaza [SFHomeBlog]

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What a shame…

and this pretty much sums it up:

Not My Supervisor

Where did all of those new voters go last night? Daly won his last election with around 6,000 votes. He will be lucky to get that many this time. And Rob Black identified 7,000+ registered voters that were committed to voting for him. What happened?

And no, this is not about downtown money. This is about voter apathy. And it’s a real shame.

Image courtesy of The Daly Show

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Are fixed rate loans the wrong choice right now?

From today’s SFGate,

Challenging conventional wisdom, a Merrill Lynch economist says homeowners who opt for fixed-rate over adjustable-rate mortgages today might regret it.

Sheryl King contends that borrowers tend to pile into fixed-rate mortgages at precisely the wrong time — just before the Federal Reserve starts cutting interest rates. It’s similar to the way investors tend to pile into stocks at the peak of the market.

Today, more borrowers are choosing fixed-rate mortgages, mainly because they don’t cost much more than adjustable-rate ones.

But Merrill economists predict that the economy will soon weaken and the Federal Reserve will start cutting interest rates early next year. By the end of 2007, adjustable-rate mortgages will be significantly cheaper, but borrowers who try to refinance could run into problems.

What I find most interesting here is similar to what I see in the purchase market. Buyers always seem to be on the wrong end of the decision spectrum. Right now, there are mixed opinions about what the real estate market will do in San Francisco, but the last time we saw this kind of inventory (more, in fact) was the fall of 2001 and fall of 2002. Just like now, buyers didn’t want to buy when they felt like they were the only ones who were buying. It’s a mob mentality.

Whether the market stays flat, drops a couple of percent (at most), or starts shooting back up, nobody will disagree that the higher inventory right now means that there are LOADS of bargains to be had. Not in the properties that just hit the market or that are less than 30 days old, because many of those are selling with multiple offers in a few days, but the ‘fringe’ properties that have some sort of buyer-perceived defect.

I’m sure there are plenty of bubble theorists that will remind me that the sky has yet to fall, but we all know that I don’t agree with that. I think we’re coming into a typical fall market with higher inventory (yet not as high as the fall of 2001 or 2002), and we’ll hit the spring market again around February or March. And between now and then, deals will be made and bargains will be had.

And the number of properties selling just stays consistent, week after week, all through 2006 (between 96 properties and 136 properties have gone ‘contingent’ each week this year, with more properties going straight to ‘pending’ as well). There’s just more inventory. And this is a good thing. More inventory equals more choice, and buyers should be happy for this.

So as always, the smart fall/winter buyers will get a good house at a good price (relative to recent history), and those who have waited since 1996 for the crash will keep on waiting. And only a couple of lucky souls will actually be able to ‘time’ the market, either buying or selling. And not because they ‘knew’ anything, but because they got lucky. Remember, this is not the stock market.

Caution in picking right loan [SFGate]

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