Industrial Nightmare

How San Francisco planners, in trying to save S.F.'s dwindling industrial base, would hamstring the city's economic future

R&R French Bros., a commercial floor-covering showroom and warehouse on Alabama Street, has been part of the economy of San Francisco's industrial eastern neighborhoods since 1954. Founded by Robert and Ray Levesque, and now operated by their sons Jim and Brad, R&R French Bros. gives city offices and retail businesses access to support just minutes from downtown. Via R&R French, for instance, Lombardi's Sports was able to pave its store on Van Ness in stylish, commercial-grade carpet without having to travel to a warehouse in the East Bay.

San Francisco Pipe and Tube, a few blocks west of Hunters Point Shipyard, is another of the "production, distribution, and repair" businesses that, San Francisco planners contend, are essential to the smooth functioning of the city's economy. By making industrial raw materials readily available within the city limits, planners say, so-called PDR businesses allow the local economy to flourish while providing San Francisco with blue-collar industrial jobs.

This week the city begins the latest round of a half-century-old debate about the role of San Francisco industrial land and businesses like R&R French and S.F. Pipe and Tube. It's a debate that energetic hand-raisers at the San Francisco Planning Department have been preparing mightily for. During the past year or so city planners have completed several book-size reports replete with charts, economic jargon, and artfully written sidebars. They've held seminars, put on workshops, and directed neighborhood meetings, all with the goal of convincing voters and politicians that large swaths of eastern San Francisco land need protection from development that is not industrial in nature. Last week, in fact, 10 of these urbanists pulled all-nighters preparing an industrial-controls presentation for this week's Planning Commission meeting.

The choice, as these planners see it, is simple. "The success of these businesses is essential to the success of virtually every business sector in the City: services, restaurants, conventions, entertainment, finance, hotels, retail, and others. PDR businesses are typically less vulnerable to the boom and bust cycles of the economy because the goods and services they provide are so intricately woven into the daily lives of San Francisco residents, workers, and visitors," the planners contend in a report titled Profiles of Community Planning Areas: San Francisco's Eastern Neighborhood. "If these essential services move farther away from the City center, cost for services will inevitably be driven up and passed on to other business sectors and ultimately the consumer."

It's a seemingly compelling argument. It's also an argument that a few telephone calls to real estate brokers, industrial tenants, and economists show to be misleading in important ways.

There isn't really an industrial land crisis in San Francisco -- at least not in the way city planning would have one believe. Rather, San Francisco is experiencing the continuation of a nationwide trend in which industries have abandoned 1920s industrial facilities near city centers and moved to modern, suburban industrial parks.

San Francisco manufacturers and distributors, and their brokers, see in the current real estate slump an opportunity to lease or buy post-1970s industrial space in spacious business parks in Hayward, Daly City, Oakland, and beyond. And the manufacturers and distributors are going for it.

R&R French Bros. recently moved its core operations to Oakland for reasons that had little to do with zoning controls. San Francisco Pipe and Tube made a similar relocation. In the past month, brokers tell me, some 1 million square feet of San Francisco industrial space have gone vacant; 4 million were already empty. And there's not much the city can do to stop or reverse the trend -- unless it wants to mow down an infrastructure of 1920s industrial buildings and create an industrial sector as friendly to large semitrailer trucks as is Hayward's.

"San Francisco has always been difficult because of the way it was laid out originally," says Ken Hurbert, credit manager for R&R French Bros. "Areas that were commercial weren't designed for 18-wheelers and are now receiving them. That's one of the problems. We've always managed here to get them in and out. But it's always a problem."

We're amid an industrial land crisis is one of those phony preservationist shibboleths (others include Schoolbook economics doesn't apply here and The demand for San Francisco housing is infinite) that persist in San Francisco despite readily available countervailing facts. These notions hang in the air unchallenged until they insinuate themselves into policy debates. In the case of the discussion about industrial land, a group of city planners has taken a preservationist's belief in the need to "save" industrial land from new office or housing development, then couched the results to appear as if they were based on a spirit of economic inquiry.

Instead of objective analysis, we have belief, or wish, or ideological imperative dressed in the clothing of factual reality.

San Francisco has hosted vigorous dispute over industrial land use since the 1950s, when the city's traditional industrial job base began moving to cheaper land and more modern infrastructure -- and San Francisco appeared destined to become a Rust Belt city. Instead, as industry moved, city fathers developed an economy based on financial services and tourism.

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