To G or not to G

REAL ESTATE | PATRICK BARBER

A two-unit home for sale at 2905 Bush Street would be affected if Proposition G passes.

A two-unit home for sale at 2905 Bush Street could be affected if Proposition G passes.

A significant slowdown in the number of multi-unit building sales in San Francisco’s northern neighborhoods suggests that Proposition G may be having an impact on the local real estate market months before city residents cast their votes.

On the ballot for the upcoming November 4 election, Proposition G is designed to discourage property flipping by levying a substantial tax on homes with two or more units that are resold within five years of purchase. Essentially, the proposed legislation could force home sellers to pay up to 24 percent of the sale price in taxes — a substantial sum in a city where the median single-family home price has hovered around the $1 million mark for most of this year.

The uncertainty surrounding Proposition G appears already to have cooled investor interest in multi-unit properties. From mid-August to mid-September 2013, eight multi-unit buildings sold in the Cow Hollow, Lower Pacific Heights, Pacific Heights and Presidio Heights neighborhoods, while four went into contract. In that same time period in 2014, only two multi-unit buildings sold and two went into contract.

And since Proposition G applies to single-family homes with in-law units, its effects could be felt beyond the multi-unit property market if voters choose to approve it.

Patrick Barber is president of Pacific Union.

Fillmore gets more neighborly

benches-wide

WHEN DINO’S became Dino and Santino’s last year at Fillmore and California, owner Dino Stavrakikis wanted to make his — and his son’s — prime corner a little friendlier. So he bought a black metal bench and bolted it to the sidewalk, inviting the neighbors to stop and sit in the sunshine, even if they weren’t ordering a slice of pizza.

His good example has now brought more benches to the stretch of Fillmore between Bush and Jackson Streets. In mid-August the city’s Department of Public Works, encouraged by the Fillmore Merchants Association, put additional benches like Dino’s on the street — only shorter, so no one is tempted to take a nap. The original 60 locations under consideration were whittled down to 19 spots acceptable to the various authorities from the city’s transit, utility, parking and disability departments.

The drive to add benches on Fillmore began 14 years ago. It took a politically savvy young DPW staffer, Ahmad El-Najjar, and funding secured by Supervisor Mark Farrell’s office to make it finally happen.

Initial reaction was mixed. Some merchants complained about smokers, and high-end fashion boutiques and restaurants feared undesirables would sit in front of their high-rent shops. But the reaction from residents has been mostly positive.

The benches are being touted as a pilot project that may be adjusted or expanded. Already several other business owners have asked for benches.

“I want one right out front,” said Dino. “The last one I had to buy myself.”

Fillmore a case study on chain stores

The Kooples, now under construction at 2241 Fillmore, has more than 300 clothing boutiques worldwide but only six free-standing stores in the U.S. and therefore is not considered a chain.

The Kooples, now under construction at 2241 Fillmore, has more than 300 clothing boutiques worldwide but only six free-standing stores in the U.S. and therefore is not considered a chain.

FILLMORE STREET CONTINUES to remake itself into a mecca of high-end fashion labels from around the world, despite the city’s professed intent to limit chain stores in neighborhood shopping districts.

Partly that is because the rules limiting “formula retail” — defined as companies with 11 or more stores — do not include stores outside the U.S.

An attempt to change the rules to include international stores and spinoffs of existing chains was put on hold last year when the Planning Department commissioned a study of the issue. Now the Berkeley consulting firm conducting the study, Strategic Economics, has produced a draft of its final report, which will be the basis of policy recommendations to be presented to the Planning Commission on May 22.

The report includes detailed case studies of three neighborhoods, including the Upper Fillmore Neighborhood Commercial District, stretching from Bush to Jackson Streets. The other neighborhoods included in the study are Ocean Avenue and a portion of outer Geary Boulevard.

“Upper Fillmore . . . is a rapidly changing district that in recent years has seen a significant shift in the types of retailers occupying local storefronts,” the report says, including “a growing number of new high-end formula clothing stores and other chain retail establishments.”

The report notes: “As the mix of retail in the district has changed, residents have raised concerns about a loss of neighborhood-serving businesses, while some independent retailers have expressed unease over competition from national brands.”
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New plaza coming to Fillmore

Rendering of the new Gene Suttle Plaza on Fillmore

Rendering of the new Gene Suttle Plaza on Fillmore

WORK BEGINS in early March on an ambitious new plan to transform the forlorn public plaza at Fillmore and O’Farrell streets into a dynamic green space that honors the history and culture of the neighborhood.

“It’s got a lot packed in,” said architect Jane Martin, whose Shift Design Studio designed the new plaza. “We want it to be fun and engaging.”

The paved checkerboard with the names of key figures from neighborhood history will remain, but eight squares of bricks will be removed and converted to planted areas with built-in benches. All of the plants will be native to Africa, and African symbols like those on nearby buildings will also be incorporated into the design. References to the earlier history of the area when it was largely a Jewish neighborhood will also be included.

“Our plan is to subvert the checkerboard and use the plaza as a way to make sense of a lot of disparate elements that have been added over time,” said Martin.

The nonprofit San Francisco Beautiful is coordinating the project with the owners of the property, nearby merchants and city agencies. The public is invited to join a community work day scheduled on Saturday, March 15, which is also when the planting will be done. The plaza is envisioned as the first phase of a larger series of neighborhood improvement projects that will unfold over the next two years.

“This is one more bead on the string,” said Kearstin Krehbiel, executive director of San Francisco Beautiful.

New limits on chain stores on Fillmore proposed

Graffiti at Fillmore and California, where fashion may replace Royal Ground coffee shop.

Graffiti at Fillmore and California, where fashion may replace a laundromat.

AS FILLMORE STREET continues to rapidly remake itself into a mecca for fashion labels from around the world, supplanting basic neighborhood services, legislation has been introduced at City Hall that would subject more businesses to the city’s limits on chain stores.

Under the existing “formula retail” ordinance — enacted by the voters in 2008 to limit the proliferation of chain stores in the city’s neighborhoods — businesses must obtain a conditional use permit to open on upper Fillmore if they have 11 or more stores in the U.S.

New legislation introduced by District 2 Supervisor Mark Farrell would amend the ordinance to include stores located not only in the U.S., but anywhere in the world. That would affect companies that have numerous stores in other countries, but are just beginning to establish a presence in the U.S.

“After hearing from both our merchants and neighbors in the Upper Fillmore about concerns that large retailers were pushing out our smaller and unique ‘mom and pop’ type of stores,” Farrell said, “I introduced legislation to expand the definition of formula retail.”

The legislation would also extend the law to include new businesses started by formula retail companies, whether or not they currently have 11 or more stores. This has been an approach favored by companies such as the Gap, which opened Athleta on Fillmore, and Starbucks, which opened Evolution Fresh.

Farrell’s proposal would apply only to the Upper Fillmore Neighborhood Commercial District, which extends from Bush to Jackson streets.

Similar efforts have been launched in other neighborhoods, including nearby Hayes Street. In response, the Planning Department has resisted neighborhood-specific legislation and instead proposed that the proposals be delayed while a study is conducted to develop uniform rules.

Farrell’s legislative assistant Catherine Stefani said her office would press forward with the legislation despite the Planning Department’s move for a citywide law.

“We have told Planning that we plan to proceed with the legislation despite the study because we felt that it was urgent to do so,” Stefani said.

City tightens chain store limits

One of Athleta's first stores opened on Fillmore in 2011. Now there are 41.

One of Athleta’s first stores opened on Fillmore. Now there are 41.

SIGNALING IT WILL be harder for chain stores to open on Fillmore Street in the future, the city’s Board of Appeals on May 15 revoked the building permit secured by German-based clothing company Oska for the space at 2130 Fillmore, where it had intended to open a new boutique.

Now that Oska has been adjudged a chain store subject to the city’s formula retail ordinance, it cannot open without going through a conditional use hearing to determine whether it is appropriate in a neighborhood already home to many chain stores and women’s clothing shops.

The formula retail ordinance requires conditional use approval before companies with 11 or more retail establishments in the U.S. can open in many San Francisco neighborhoods, including upper Fillmore Street.

The board found that Oska has nine stores currently operating in the U.S., as well as leases for two additional stores — in Healdsburg and in Evanston, Illinois — bringing its total to 11 retail establishments within the meaning of the law.

“Savvy chain store operators are intentionally opening locations in the district prior to exceeding the 11-store cap in order to avoid application of the formula retail controls,” the board stated in its written preliminary findings issued a week after the hearing. “The existing concentration of formula retail uses is having a negative impact on the character of the neighborhood.”

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Board of Appeals says Oska is a chain

AT ITS REGULAR monthly meeting tonight, the Board of Appeals ruled that Oska, the German clothing line, is a chain store and must comply with the city’s formula retail ordinance before it can proceed with plans to open at 2130 Fillmore Street, formerly the home of Jet Mail.

EARLIER: Oska stirs chain store fight on Fillmore

Dental school may become condos

Landscaped townhouses might replace the dental school's parking lot.

The six-story building at Webster and Sacramento Streets that is home of the dental school of the University of the Pacific — which is scheduled to move downtown next year to Fifth Street — may be converted into condominiums.

Trumark Urban, a privately owned development company based in Danville, is exploring the possibility of creating 110 to 130 high-end condos in the existing building. In addition, on the 17,000-square-foot surface parking lot to the west, they would add townhomes and landscaping between Sacramento and Clay Streets.

“We’re in the early stages of figuring out how we might re-purpose the building,” said Kim Diamond, Trumark’s development director. “But we’re really excited about the area and the building.”

Diamond and Trumark managing director Arden Hearing have been reaching out to neighborhood leaders as part of their due diligence in deciding whether to go through with their tentative agreement to buy the property. Among others, they consulted with Pacific Heights Residents Association board members Greg Scott and Paul Wermer, who raised the perennial concerns about parking and traffic but responded positively to the idea of creating residences. The building has been widely expected to become another medical building, given its location near the hospital.

“This is probably the least impactful use of the property,” said Wermer.

Diamond said her company is unlikely to proceed if there is opposition to the project. “We really want the neighborhood’s support,” she said.

In Hungary, an ambassador from Pacific Heights

Secretary of State Hillary Clinton with Markos and Eleni Tsakopoulos-Kounalakis

By Markos Kounalakis

BUDAPEST, Hungary — Many of my Saturdays used to start out with a saunter down Fillmore Street for an early morning cup of coffee while the rest of my family was still in bed.

Budapest is also a coffeehouse city, but more famed for the conversations and art that grew out of that culture than the coffee in the cups.

It has been three years since we left San Francisco and moved to a country that only a generation ago was behind the Iron Curtain. As I look outside my office here, I see the Statue of Liberty — not the one in New York harbor, but the one atop Gellert Hill in Budapest, erected by the Soviets after World War II. From her office window, my wife looks toward a Soviet monument in the middle of Szabadsag ter — Freedom Square — a golden star topping the prominent stone memorial.

From our apartment in Pacific Heights, we looked out on the bay, the sailboats and the container ships crossing under the Golden Gate Bridge. President Obama marveled at the view during the couple of times he visited our home before assuming office. He later appointed my wife Eleni Tsakopoulos-Kounalakis as the U.S. Ambassador to the Republic of Hungary — a complex and demanding job that brought our family to beautiful Budapest.
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The Fillmore is getting its groove back

Opening night at Yoshi's on November 27, 2007 | Photograph by Mina Pahlevan

ON ANY GIVEN NIGHT, Fillmore Street south of Geary is buzzing with street life. Stylish patrons make their way to 1300 on Fillmore for cocktails and dinner, or line up outside State Bird Provisions hoping for a coveted seat at what Bon Appetit magazine anointed as the best new restaurant in the country. Concertgoers head to the Fillmore Auditorium and Yoshi’s. Around the corner at Fat Angel and Social Study, a youthful clientele talks over drinks and snacks.

Five years after the opening of the cornerstone Fillmore Heritage Center in November 2007, lower Fillmore is finally getting its groove back.

“We’re bullish on the Fillmore,” says Jason Kirmse, one of the owners of the Fat Angel wine bar, who hopes to open another spot nearby.
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