Board approves Geary‑Masonic special‑use changes to allow 101‑unit project with off‑site affordable housing fee

The San Francisco Board of Supervisors voted 10‑1 on April 21 to approve an ordinance amending the Geary‑Masonic Special Use District to allow a developer to build 101 housing units and pay an inclusionary housing fee in lieu of providing all below‑market‑rate units on site.

The ordinance amends the planning code to modify minimum parking requirements and ground‑floor ceiling heights in the Geary‑Masonic SUD and to permit payment of an in‑lieu inclusionary housing fee; the board also affirmed the project’s CEQA determination. Supervisor Stephanie, the ordinance’s sponsor, said the changes would unlock construction of 101 units in District 2, generate more than $4,500,000 for affordable‑housing projects citywide and create more than 250 union construction jobs.

Sponsor’s case and developer claims

Supervisor Stephanie said she and city staff reviewed developer pro formas and feasibility analyses before bringing the measure forward and credited the Office of Economic and Workforce Development with vetting the financial case. She said a construction contract and a commitment from a union pension fund lender are currently in hand and that the COVID‑19 public‑health emergency is increasing costs and tightening the window for financing. “The best chance of delivering the maximum amount of new housing in my district, including the maximum number of BMR units, is by approving the legislation today,” she said.

Dissent and transparency questions

Supervisor Preston was the lone dissent. He said he had asked the developer for financial documents and that the developer did not provide them to the full board, raising concerns about the ability of supervisors and the public to evaluate the claim that on‑site affordable units are infeasible. Preston cited the city’s Sunshine Ordinance (section 67.32) and asked whether its disclosure requirement for recipients of city subsidies applied in this case. “I am baffled as to how we as a board can thoughtfully decide whether to amend a special use district … without any showing of the financial need for all colleagues to see before they vote and for the public to see,” he said.

Deputy City Attorney Pearson replied that the Sunshine Ordinance applies where the city gives a direct subsidy, and said a legislative amendment that offers a developer the option to pay an in‑lieu fee is not the same as a direct subsidy. "The Sunshine Ordinance doesn't define subsidy, but we would give it its average meaning here and not read it to include a situation like this, where the legislation is giving a developer the option to pay a fee," Pearson said.

Preston also flagged the developer’s financial projections for using furnished rentals, which the developer’s materials said would raise returns. He said the developers’ figures showed returns nearly 19.1 percent higher with furnished units and asked whether the proposed ordinance or existing law would bar corporate or intermediate‑term rentals in the future. Deputy City Attorney Pearson said she was not aware of a law in the proposed ordinance that would categorically prohibit corporate or intermediate‑term rentals, and noted that separate legislation to regulate intermediate‑length occupancy had been introduced and remained pending in committee.

Other supervisors and labor

Several other supervisors supported the ordinance, emphasizing the project would produce new housing in a neighborhood that has produced little housing in prior years, that the site has been vacant for years, and that the proposed development includes a 100 percent union‑labor commitment — a factor supporters said helped secure financing. Supervisor Mandelmann and others said the proposal creates immediate housing and funds for affordable housing rather than leaving the lot vacant.

Vote and next steps

The Board adopted the ordinance on second reading by roll call, 10 ayes and 1 no (Preston). The ordinance text instructs planning staff to update the code and the zoning map as required, and the sponsor and city agencies said they expect the project to move toward permitting and construction subject to financing and the usual development approvals.

Clarifying details and limits of city authority

- Project size: 101 units (as stated by sponsor). - Estimated in‑lieu payment: “more than $4,500,000” for affordable housing (sponsor’s estimate). - Jobs: sponsor said the project commits to 100 percent union labor, “over 250 jobs.” - Vote: 10‑1 (Supervisor Preston opposed). - Legal note: Deputy City Attorney Pearson advised that the city’s Sunshine Ordinance requirement for disclosure of financial projections attaches where the city grants a direct subsidy and does not, in her office’s opinion, apply to a legislative option to pay an in‑lieu fee.

Why this matters

The measure moves a long‑stalled site toward construction while shifting some affordable‑housing units off site in exchange for a fee the sponsor says will fund housing elsewhere. Opponents warned that the public and the board lacked the underlying financial documents needed to judge the developer’s claim of infeasibility, and raised concerns about future use of units as furnished or corporate rentals. Supporters said the action makes use of a narrow financing window and produces both housing units and funds for affordable projects, and that a union‑labor commitment improves access to private debt.

Implementation risks and timeline

City staff and the sponsor said the project’s financing window is time sensitive; staff indicated planning, permitting, and financing remain subject to market conditions, lender requirements and the impacts of the COVID‑19 emergency. No construction start date was given at the board meeting.

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