Why Here? Why Now? Why So Big?

Gabriel Metcalf and Jennifer Warburg | October 18, 2013 | Story Real Estate

This wave of growth (detailed at great length in this month's cover story, "Cranespotting") didn’t begin out of thin air once the economy picked up. On the contrary, it’s based on a unique confluence of factors that have been brewing for more than a decade. Here’s an explanation from the people helping to make it happen, Gabriel Metcalf, Executive Director, and Jennifer Warburg, Special Projects Manager, of SPUR.

Factor One: Mainstream acceptance of urbanism over suburbanism.
Increasingly, the public is coming to believe what urban planners have been advocating for years: Sprawl is bad for our health, for the planet, and for the vibrancy of our communities. Today, a vast majority of the 7.15 million people in the Bay area reside in low-density, car-dependent communities, which means that more than two-thirds of Bay area workers drive to work—alone.

Having built the region the wrong way, we are now faced with the expensive task of urbanism: retrofitting and reinvigorating existing neighborhoods with housing, jobs, entertainment, schools, and shopping where people can reach them on foot or by public transit. A good example is the approved 1050 Valencia Street project, a planned apartment building that includes no parking spots for cars, but 28 for bikes—because there is less need for a car in a dense, urban neighborhood.

Factor Two: Favorable alignment of market forces
In 2012, San Francisco saw its job numbers increase, percentage-wise, more than any other major city in the United States. It’s projected that by 2040, the city will have gained 280,000 residents. People want to live here, and companies want to locate jobs here But this particular development wave has swelled as a result of conditions created by the 2008 recession: cheap money, cheap labor, cheap materials, and cheap land. Because the rest of the country was still in recession while the Bay Area was beginning to experience a tech boom, speculators with money to invest flooded this region. (People unhappy with the ways their neighborhood is changing often direct their frustrations against new development, but they are confusing the causal relationship: Development doesn’t cause growth. Growth causes development.)

Factor three: Politicians diving in.
Paralleling the real estate cycle is a cycle of political willingness to vote for growth. When San Francisco is in recession, voters become more invested in creating jobs and strengthening the tax base. Politicians who support pro-development measures can get elected: think former mayor Willie Brown (the Ferry Building and other Embarcadero renovations, approval of the original Mission Bay plans, and so on) and, arguably, mayor Ed Lee (the Transbay Hub and the Twitter headquarters on Market Street). When the city is in a boom, attitudes change, leading to ballot measures to stop growth, such as Proposition K, passed in 1984, which restricts new buildings from casting shadows on parks, and Proposition M, from 1986, which caps the volume of new office projects that the city can approve each year (a cap that we will likely approach in the next year or two).

Factor Four: Fifteen years of planning groundwork.
From the approval of the Mission Bay Plan in 1998 through this year’s approval of the western SoMa Plan, San Francisco has completed plans for 16 major projects—an unprecedented number—which together cover more than 15 percent of the city. This is perhaps the greatest accomplishment of the planning advocacy community, including SPUR and others: We made the case for planning—the public process of deciding how to build—as a more efficient way to resolve conflicts and avoid site-specific land use battles.

Each project requires intensive analysis, with input from both neighbors and planning experts. Consider the Market Octavia Plan, intended to repair divisions created by the Central Freeway while growing residential, retail, and public space. Public agencies sought broad agreement on where new buildings were acceptable (along Market Street, the city’s civic and commercial spine) and where they weren’t (on residential side streets) and changed zoning to reflect the consensus. Walk on Upper Market today from Castro to Octavia, and you’ll see that virtually every former parking lot and gas station has a condo project going up. The great lesson of this wave is that growth does the most for our city if we decide beforehand where we want to build, as part of a real neighborhood effort.

Factor five: Sheer demand.
There are 6,000 housing units under construction right now, in marked contrast to the 418 total built in 2011 and the 1,642 average that San Francisco has produced annually over the last 40 years. (SPUR estimates that to add enough supply to moderate housing costs, we would need around 5,000 new units per year over a sustained period.) But we are not likely to continue building at this pace. the cost of development will rise and, if history is any lesson, there will be a resurgence of anti-growth politics. all of it may reduce our rate of development to a trickle.

Building cycles come and go, but planning is about being proactive. if we want to continue moving San Francisco toward a more livable urban environment, we need to begin the next series of neighborhood plans now, laying the groundwork for future waves.

For more about SF's construction boom, check out "Cranespotting."

Originally published in the November issue of San Francisco

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