Board approves 75-year ground lease for 25 Essex supportive housing project

The San Francisco Board of Supervisors on Tuesday approved a ground lease that will allow the redevelopment agency to lease 25 Essex Street to 25 Essex LP for 75 years to build supportive housing for very low-income, formerly homeless residents.

Redevelopment acting deputy executive director for housing Sally Orth told the board the project — the first residential development moving forward in the Transbay redevelopment area — will include supportive services and ground-floor retail. Orth said the development team of Bridge and Community Housing Partnership had secured funding from multiple sources, including the state multifamily housing program, low-income housing tax credit equity “almost $18,000,000,” and redevelopment funds, and that construction was expected to start in December.

The ground lease sets rent at $1 per year and includes a minimum 75-year term to ensure long-term affordability, Orth said. The city attorney asked that the board add language clarifying that the lease was entered into and executed before the suspension of redevelopment activities under recent state law changes and is therefore an enforceable obligation; the board approved a non-substantive technical amendment to add that language.

District Supervisor (speaking for the neighborhood) said the project will provide 19–20 units of supportive housing for formerly homeless residents, include on-site intensive case management, and provide ground-floor retail to increase street activity in the area. The board took no public comment on the item and closed the public hearing.

Supervisor Kim moved the amendment; the motion was seconded by Supervisor Obelas. The resolution as amended passed on a roll-call vote of 11 ayes, 0 noes.

The redevelopment agency and the Department of Public Health will continue to implement the supportive-services plan and operating subsidy arrangements described during the presentation.

Votes and formal action

- Motion: Approve and authorize the redevelopment agency's execution of a 75-year ground lease of 25 Essex Street (Renee Casalnave Apartments) to 25 Essex LP for development of very low-income supportive housing and ground-floor retail; incorporate city attorney clarifying language about enforceable obligations. Mover: Supervisor Kim. Second: Supervisor Obelas. Outcome: adopted (11-0).

Why it matters

The project is the Transbay redevelopment area's first residential affordable housing project to reach the construction stage under the plan. The long ground-lease term and $1-per-year rent are intended to secure affordability for decades and enable the use of low-income housing tax credits and other long-term financing that require stable affordability controls.

Provenance

Transcript excerpts from the public hearing and staff presentation introduce and close this topic and support the facts above.