Building Inspection Commission grants, denies and continues multiple hotel amortization extensions; April 16 set as final continuance deadline

The San Francisco Building Inspection Commission on March 19 heard nearly a dozen applications for extension of amortization periods under the Hotel Conversion Ordinance (HCO), Administrative Code Chapter 41 (Ordinance 36-23). The commission granted several extensions, denied a small number of requests where applicants did not provide required documentation, and continued many cases to the commission’s April 16 meeting — which the panel said will be the final date for continuances.

The matters matter for housing policy in San Francisco because Ordinance 36-23 shortens the definition of transient/tourist use and permits owners to request reasonable amortization periods to recoup investments made under the prior regulatory regime. Staff presentations described the rule set and advised the commission to weigh the total cost of investments, the length of time those investments had been in place, the suitability of investments for residential hotel use, and any other factors relevant to a reasonable return on investment. Matt Luton, senior housing inspector, summarized the ordinance and the staff’s analytical framework: “The hotel conversion ordinance or HCO is codified in chapter 41 of the Administrative Code. The continuing and primary purpose of the HCO is to preserve residential guest rooms, which provide crucial housing for elderly, disabled and people with low incomes.”

Commissioners and parties debated how to allocate costs between tourist and residential uses, how to account for investments made many years prior, and what documentary evidence was required. Several applicants asked for continuances to provide invoices, permits, photos, receipts or clearer breakdowns; staff repeatedly asked for specific descriptions of investments and their dates. Commissioners consistently emphasized the hearing rules and the narrow statutory scope, and reminded applicants that the commission could not consider some factors (for example, general…