Northern News

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A publication of the American Planning Association, California Chapter, Northern Section

Making great communities happen

Approval process isn’t only obstacle to SF housing goals

San Francisco Examiner, February 9, 2019

Laura Waxmann  • “Close to 45,000 potential homes are currently approved in San Francisco — the highest number tracked by the city’s planning department to date — but many have yet to break ground.

“ ‘No more bureaucracy. No more costly appeals. No more not in my neighborhood. It’s simple: Affordable housing as-of-right because housing affordability is a right,’ said Mayor London Breed.

“But public disapproval and the slow approval process aren’t the only roadblocks. Constraints on financing and a growing trend of flipping entitlements are significant causes for delays, with some sponsors never intending to build.

“Sean Keighran, president of the Residential Builders Association, cited city departments “working in a bubble’ as exacerbating ‘uncertainty’ already experienced by developers due to construction loans, ‘high land costs, rising interest rates, rising construction costs, and a softening real estate market.’

“Keighran called construction loans the ‘highest risk of all,’ adding that interest rates, now as high as 8 percent, have doubled in recent years, while real estate sales are slowing down.

“The non-profit Council of Community Housing Organizations estimates that it can take up to four years for a for-profit project to secure financing for construction, and entitlements can be sold to other investors or ‘held for years with no firm requirement to build the project.’

“ ‘You can easily increase a property’s value in hundreds of thousands to millions of dollars just by entitling a project,’ said Jonathan Moftakhar, a realtor with Vanguard Properties.” Read more here