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‘First of Its Kind’ Development Agreement Delayed

A RENDERING OF THE ORIGINAL 103-UNIT DEVELOPMENT. PLANS NOW CALL FOR AN ADDITIONAL FLOOR AND 10 MORE UNITS.

One year after Mayor Ed Lee’s office announced that a “first of its kind” housing development was coming to the Excelsior, City Hall now expects to present an agreement nine months late.

On Oct. 24, 2016, Mayor Ed Lee announced that SST Investments intended to construct a privately financed 103-unit building with 51 permanently rent-controlled units and 52 below market rate units.

“This is an historic agreement that will offer more than 100 families affordable housing in perpetuity,” Lee stated.

At the time, the city did not have an official agreement with the developer. Instead, the Office of Economic and Workforce Development had started work on a development agreement that would give SST Investments exemptions from some city zoning codes and a state law restricting the construction of new rent-controlled units.

A year later, the agreement has been delayed as work on an environmental review, which must be approved by the Planning Commission before a development agreement is considered, has taken longer than expected, according to OEWD spokesperson Gloria Chan.

OEWD now estimates a development agreement will be ready for consideration by Fall 2018 instead of Winter 2017 as originally estimated, according to Chan.

The plans now call for 113 units, 5,958 square feet of commercial space and a five-story frontage on Alemany Boulevard, according to Chan.

Reza Khoshnevisan, who is working on the project for SIA Consulting, said that the developer is still committed to building the project with the same housing ratio outlined in the press release and plans to hold an outreach meeting in November.

“I hope that a robust conversation is created where the community can hear all about the proposed project, give its feedback and a proposal is created that neighbors feel good about,” District 11 Supervisor Ahsha Safai said about the upcoming meeting.

“First of Its Kind”

Safai, who was a candidate for supervisor at the time of the press release, helped the developer approach the city with the idea, which he is quoted calling it a “first of its kind for San Francisco, if not the state.”

The construction of new rent-controlled units is largely restricted in California under the Costa-Hawkins Housing Act in 1995 and private developers rarely propose constructing them since they bring in less money.

“This is an important project for our neighborhood in that no other privately owned project in the history of the City has voluntarily offered 50 percent of its units as affordable and 50 percent as rent controlled,” Safai said. “I am looking forward to the developer confirming their proposal 100 percent to the community.”

Development agreements for Park Merced and Trinity Plaza include waivers to allow for the replacement of rent controlled units but not for the construction of entirely new rent-controlled units as SST Invesments has proposed.

Ethics Complaint

For Safai’s critics, the timing of the press release — fifteen days before the election — and Safai’s history with the development team raised concerns.

In an Ethics Complaint filed on Oct. 27, 2016, then-District 11 Supervisor John Avalos alleged that Safai should have been registered as a lobbyist because of his role negotiating between SST Investments and the city on plans for 915 Cayuga Ave.

In 2013, Safai was paid more than $10,000 as a consultant for SST Investments, according to a financial disclosure form from that year.

SST Investments, SIA Consulting and Tahbazof Law Firm, three companies that share a South of Market office building, often collaborate on projects including 915 Cayuga Ave.

In 2013, Safai attended meetings of the Ocean Avenue Association to discuss 280 Brighton Ave, a mixed-use project of SST Investments and SIA Consulting.

“As an unregistered lobbyist [Safai] is concealing his actual relationship with his clients and City government, a conceit that enables him to claim that he is negotiating community benefits and delivering City resources and services as a neighborhood activist rather than as a candidate,” Avalos stated.

Safai’s connections to the development team have continued through his campaign and into his first term.

In 2015, eight employees of SST Investments, SIA Consulting and Tahbazof Law Firm contributed $4,000 to Safai’s 2016 campaign.

This June, Safai dropped plans to build two hillside homes to be designed by SIA Consulting after neighbors decried the loss of rare open space.

In response to questions about 915 Cayuga Ave., Safai stated that his office had treated the development the same as any other in the district.

“I worked for them over three years ago,” Safai wrote. “There is no issue.”

Tom Murphy, who grew up in the neighborhood and runs the popular Excelsior District Facebook page, said that he sees all new housing developments in the community as a positive sign.

“I think it’s positive just to have housing built in the neighborhood,” Murphy said. “From a political standpoint, the timing of the announcement couldn’t have been better.”

Issues

While work continued on the development agreement, city staff were also mitigating a series of complaints about the current uses of the land.

Complaints and emails gathered through a public records request show that the Department of Building Inspection and the Planning Department responded to complaints about the existing conditions at the property throughout 2017.

Since SST Developments purchased the property in 2009, a dozen people have filed DBI complaints about unpermitted uses on the property, including people living in unsafe conditions.

A Planning Department official found similar conditions on a tour of the property this February.

“In general, the property exhibited alarming characteristics. Outdoor motor vehicle repair, DIY metal fabrication, unpermitted dwelling units…” David Brosky wrote to a lawyer for the developer in an email obtained through a public records request.

A neighbor of the property, who requested anonymity, said that while they had seen some evidence of people living on the property in the past, the city had responded to the complaints swiftly after the Ghost Ship Fire in Oakland killed 36 people in December 2016.

SIA Consulting’s Khoshnevisan said that all of the DBI complaints had been closed and that no one currently lives on the property.

DBI confirmed that the final complaint against the property was closed on Oct. 5 after an inspector gained access to the property.

Editor’s Note: The print version of this article in our November 2017 issue identifies Reza Khoshnevisan as an architect for SIA Consulting. Khoshnevisan is not registered with the California Architects Board

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