San Francisco Sun

San Francisco, CA – Mayor London N. Breed has proposed new legislation to waive development impact fees and inclusionary housing requirements for office-to-housing conversion projects in an effort to revitalize Downtown. This move is part of her "30 x 30" initiative, which aims to bring at least 30,000 residents and students to the area by 2030.

The current economic conditions make conversion projects difficult to finance. The City’s impact fees and inclusionary housing requirements are significant costs, typically adding between $70,000 to $90,000 per unit. The legislation introduced with Supervisor Matt Dorsey will waive these fees for all commercial-to-residential conversion projects Downtown.

Mayor Breed stated, “San Francisco is changing to a City of Yes where we remove all the barriers and obstructions that get in the way of what’s possible.” She added that eliminating these fees supports the transformation of Downtown into a 24/7 neighborhood filled with housing, restaurants, shops, and small businesses.

Supervisor Matt Dorsey praised the initiative: "Mayor Breed and I are working side-by-side to accomplish her ambitious 30 x 30 initiative." He highlighted the potential for a thriving downtown where people live, work, and play.

The ordinance would also extend the Commercial-to-Residential Adaptive Reuse Program indefinitely. This program offers zoning waivers and permit streamlining for conversion projects. Recently, the Department of Building Inspection published an Adaptive Reuse Information Sheet clarifying compliance methods for these projects.

Two conversion projects have already been approved under this program: the Warfield Building at 988 Market and the Humbolt Bank Building at 785 Market. The new ordinance aims to facilitate more such conversions.

Governor Gavin Newsom recently signed AB 2488 (Ting), allowing San Francisco to establish a special financing district for commercial-to-residential conversions starting next year. Jesse Blout from Strada Investment Group commented on this: “This legislation — along with the Mayor’s March ballot measure and the recently-passed AB 2488 — would provide the financial tools needed to convert zombie office buildings into much-needed housing.”

The "30 x 30" initiative was announced during Mayor Breed’s State of the City address as part of her Roadmap to San Francisco’s Future. It includes converting underutilized office space into at least 5,000 new housing units and attracting universities to bring 10,000 students Downtown.

Additionally, Mayor Breed is pushing for zoning changes in Central SoMa and Transbay Plan Areas to allow more residential development by removing outdated provisions requiring commercial space in mixed-use projects. Planning Director Rich Hillis said this legislation removes key financial barriers, making it easier to bring housing Downtown.

Attracting universities is another component of Mayor Breed's vision. Sarah Dennis Phillips from OEWD noted that San Francisco's status as a tech hub makes it an ideal location for higher education institutions.

Mayor Breed also announced plans for Embarcadero Plaza redevelopment through a public-private partnership with BXP. Phil Ginsburg from SF Recreation and Park Department said this project aims to create spaces for healthy recreation and vibrant culture. Rod Diehl from BXP added that this presents an opportunity to reactivate public space as a central gateway to Downtown San Francisco.