On Affordability, Divisadero Developer Delivers More Questions Than Answers

Will any of the 177 proposed rental apartments be for lower income earners? At a community meeting Monday, the developer wouldn’t commit.

The corner of Oak and Divisadero streets, where the 400 Divisadero development will rise. (Photo: Garrett Bergthold)

It’s 6:30 p.m. and the normally busy Touchless Car Wash at 400 Divisadero St. is closed for the day. The connected Shell gas station serves two cars in the same 10 minutes it takes five tech buses to drop off dozens of workers at the corner.

For years, the corner has marked an unofficial dividing line between Lower and Upper Haight, offering car owners a place to fuel up and get their vehicles detailed. But that may change if a proposed development planned for the 1-acre lot on the corner of Divisadero and Oak streets, currently a car wash and gas station, gets approved by the city. First though, it needs the backing of neighbors.

More than 60 neighbors joined the Alamo Square Neighborhood Association and North of Panhandle Neighborhood Association at Divisadero music venue The Independent Monday night, as the groups hosted the first community meeting for the project not organized by the developer.

The development’s proposal calls for constructing 177 rental apartments 6 stories high, 8,000 square feet of ground floor commercial space, and 75 parking spaces at 400 Divisadero St., which for the past 60 years has been a car wash, gas station, and at one time a bar.

Developer David Kriozere of Genesis Real Estate Group delivered a brief presentation of the project at Monday’s meeting, before he and his team fielded questions from the audience.

The questions got specific and heavy, really quick.

“What are some of the obstacles for you increasing the amount of affordable housing?” asked a man from the audience, accusing the developer of providing the absolute minimum of affordable units required by the city.

“Balancing,” said Kriozere. “I have to balance what the neighbors want, what the city wants, and what our lenders want.”

While the project’s preliminary plans have been public since the developer announced the proposal last October, last night’s meeting shed new light on how Kriozere may or may not comply with the city’s inclusionary housing program. The program requires developers building over 10 units in San Francisco to reserve a small chunk to be affordable housing and built “on-site”, build the same number of units somewhere else “off-site,” or pay into the Mayor’s Office of Housing and Community Development affordable housing trust fund. As 400 Divisadero’s application was filed prior to 2015, its minimum is only 14.5 percent, in contrast to 19 percent for those filed since.

During the meeting, Kriozere talked his way around committing to anything solid, but did mention he would “try to build the affordable units on site.”

However, the audience didn’t seem content with that lack of commitment and pushed for Kriozere to maximize affordability. One man went a different route, asking Kriozere why the developer team wasn’t planning on utilizing the city’s local density bonus program Home-SF that grants a project extra stories in exchange for 40 percent of the total units being two bedrooms or larger – which the current proposal already calls for – along with 30 percent of the units being reserved for a range of affordability levels.

“Wouldn’t it help you to achieve your affordable housing objective if you increase your floors by one or two?” the audience member asked. “You’re allowed to do that if you increase your amount of inclusionary housing.”

Kriozere responded saying he’s received strong feedback from neighbors that even the proposed 6-story building is “way too big.”

“Let’s preserve the neighborhood character by staying exactly within the height that’s allowed,” he said.

Due to a rezoning of Divisadero Street launched by District 5 Sup. London Breed in 2015, 400 Divisadero is a bit trickier to develop than other projects in the city right now. In 2015, the Divisadero corridor from Haight Street up to Geary Blvd. was rezoned from a neighborhood commercial district (NC-2) to a neighborhood commercial transit district (NCT). One little word allowed higher density housing to be built along Divisadero Street, more than tripling the original housing proposal for 400 Divisadero from 51 units to 177.

Then came the backlash. Neighbors from the group Affordable Divis accused Sup. Breed of upzoning the neighborhood without community input, and without increasing affordability requirements. Then in 2016, Sup. Breed promised to increase affordable rates on Divisadero and Fillmore up to 23 percent. But according to Gus Hernandez, president of the Alamo Square Neighborhood Association, Breed has yet to follow through on that promise.

While Breed skipped Monday’s meeting, Samantha Roxas, Breed’s legislative aide, showed up to answer questions from neighbors. Roxas told SF Weekly that the supervisor is “looking into requiring (on-site affordable units)” to be built on the site. Roxas hinted that the new study, set to be presented to the Planning Commission Thursday, shows that a 22 or 23 percent on-site inclusionary requirement is feasible.

Given the zoning change, Genesis Real Estate Group says they are waiting for the city to determine what the inclusionary housing requirements are for the Divisadero NCT corridor, prior to committing to anything. If built, 400 Divisadero will be the first residential construction project completed under the new zoning laws.

Charle Dupigny heads the North of the Panhandle Neighborhood Association and helped organize last night’s meeting. While he says his group is waiting on an environmental impact report and transit study to take an official position on the project, he says the conversation would be “immensely” different if the developer publicized how the project will incorporate affordable housing. Dupigny says it’s the number one question on neighbor’s minds.

Given the 2015 rezoning that resulted in additional units for the project, Dupigny sees no reason why the developer cannot add increased affordability beyond the city’s bare minimum inclusionary requirements.

The Planning Commission will hear a presentation this Thursday from the Controller’s Office of Economic Analysis, along with staff from the San Francisco Planning Department, on the feasibility of requiring developers to build affordable units on site where rezonings have occurred in recent years, with a particular focus on Fillmore and Divisadero streets.

Kriozere expects the proposal will go before the Planning Commission by the end of this year. In the meantime, he will be at Madrone Art Bar up the street from 400 Divisadero every Wednesday from 5-7 p.m. to chat with community members about the project.

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