Make Room for Dot-Coms

Forget about live-work lofts. The newest fight for San Francisco's soul is over multimedia office space.

This is a clean, compact industry offering thousands of jobs, including positions for entry-level workers, highly paid professionals, and everything in between. The industry promises millions of dollars of tax revenues, and will inject many billions of dollars into the city's overall economy, the pro-growth advocates note.

But it is in more lofty terms that San Francisco's future will actually be debated -- literally lofty: Should a former industrial loft that is now filled with cubicles and computers and receptionists and systems administrators be called an office? This civic discussion has just begun at the San Francisco Board of Supervisors. Implicit in this discussion -- which is now taking place at City Hall, at the Planning Department, in corporate boardrooms, and in neighborhood activists' living rooms -- is whether San Francisco should grow, or try to congeal itself into the 1970s. While seemingly architectural in nature, this debate really asks whether city planning should first seek to accommodate people, or cars; whether the city should welcome new jobs; whether the city should understand and plan around market forces, or ignore, and then decry, them.

It's a debate that's raged in San Francisco for 30 years. The vocabulary shifts from decade to decade, but the premise never does: Should we seek to accommodate newcomers, or exclude them?

Jim Gonzalez, hired by dot-com companies and their real estate developer allies to lobby for increased digital media space.
Jim Gonzalez, hired by dot-com companies and their real estate developer allies to lobby for increased digital media space.
Sue Hestor, the live-work loft foe who has now turned her sights on curbing multimedia offices.
Sue Hestor, the live-work loft foe who has now turned her sights on curbing multimedia offices.

Sue Hestor, she of the sturdy, college-discus-thrower bearing, the rat-a-tat Nebraska auctioneer delivery, and the overweening confidence of someone who's had her way with the San Francisco alternative press for 20 years, tucks into a bowl of duck, sausage, and white bean cassoulet maison, at a French jazz bistro near her downtown law office.

Between spoonfuls, she describes her role in modern San Francisco political history (it's central). She explains the personal formation and ethical compass of San Francisco developers (they're vile). And, in great detail, she lays out the way raw-material inputs, industrial planning, and civic zoning combine to foment economic growth and stability in western cities (at least, Sue Hestor's version).

"We have a resilient economy because we have a wide base for our economy," she says. "San Francisco has a huge base of people who provide services to its residents. Suburban models are often monocultures. Services need to be provided here. It's the civilized way of dealing with your residents. If restaurant-supply companies have to go to Contra Costa County, restaurants are going to have problems. Everything on this dining table came from somewhere, and I can pretty much tell you where to buy everything. You have to ask, 'What are the parts of the economy that make the economy work?' For example, shuttle bus services. Buses that have to park in Hayward are going to cost a lot more. Or specialized audiovisual equipment. Those kinds of facilities are necessary for the convention industry to function. The extent to which it is more expensive for the convention industry, it adds to the cost of doing business. So it's all about how San Francisco fits these components into its economy."

Hestor is an attorney who makes her living suing developers and commercial landlords on behalf of tenants, or on her own behalf. She earns part of her income indirectly from settlements with developers, who calculate that bargaining with Hestor is cheaper than allowing projects to languish in court and Planning Commission hearings. For the past two decades, she has been present at every sort of City Hall development meeting, working tirelessly to beat back commercial and housing projects. She drafted Proposition M, still a guiding template for commercial real estate development in San Francisco. For the past three years Hestor has sounded the clarion against live-work lofts. Now she's in court and at City Hall fighting multimedia office space.

"What the Internet economy is, it's called a Ponzi scheme. Do you know what that is?" Hestor asks, helpfully. "Everyone wants to be a billionaire, but not everybody is going to strike it rich. I don't see myself being able to say, 'Take out entire square miles and let owners of Internet businesses decide the future of our city.'"

Despite Hestor's self-assurance, the statements she makes about San Francisco politics are interesting not because she is a political leader, per se -- it's hard to tell where her role as City Hall ringmistress ends and her own notions of personal grandeur begin. Rather, she's interesting and important because her political sensibilities and personal experience swim at the vortex of San Francisco's peculiar brand of progressivism. And this ideology, and how our leaders respond to it, will reverberate into the future of San Francisco's Internet economy.

Hestor's ideas about growth and development might not be the best road map for predicting the effects city planning decisions will have on the lives of ordinary citizens. But they're ideas shared by many San Franciscans.

And while Hestor's economic theory may be nothing more than a garbled version of five-year-plan Sovietism, half-asleep-in-high-school-economics-class-ism, and wistful, good-ole-days nostalgic romanticism, for an important portion of the citizenry here, it's San Francisco Economics 1-A. Politicians, planners, entrepreneurs, and pundits ignore it at their peril.

While seemingly ad hoc, this uniquely San Franciscan ideological stew wasn't just bought off the shelf. It's a group of sensibilities that have simmered through decades of political battles and myriad economic, demographic, and social changes. This ideology doesn't limit itself to real estate development -- racial diversity, poverty, homelessness, the environment, middle-class quality of life, and other issues are all part of the mix. But anti-growth real estate battles were the cooker in which this olio of ideas became fully formed.

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