Port Commission approves change to Mission Rock housing plan, lowers phase minimum affordability

The Port Commission voted to amend the Mission Rock housing plan and related parcel lease documents, approving a modification that shifts the mix of below‑market units in Phase 1 and lowers the plan’s minimum per‑phase affordability benchmark.

Port development staff explained the change as a response to post‑pandemic leasing dynamics. Wyatt Donnelly Landolt said leasing at Mission Rock has been uneven across income tiers: units targeted at 90% of area median income (AMI) leased quickly while units targeted at 150% AMI leased slowly. To accelerate occupancy and stabilize building finances, staff proposed eliminating the 150% AMI tier in Parcel A, increasing 90% AMI units and retaining 20% AMI units; as a result phase‑level affordability would fall below the housing plan's current 30% minimum. Staff therefore requested an amendment to lower the per‑phase minimum from 30% to 20% to accommodate the revised unit mix. The commission adopted Resolution 25-17.

Why it matters: Mission Rock is a multi‑parcel, multi‑phase waterfront development with an overall affordability goal of 40% across all phases; the change affects Phase 1 distribution of income‑targeted units and is intended by staff and Mission Rock Partners to speed leasing and occupancy while preserving deeper affordability in some units.

Details from staff and developers - Current and proposed unit mix: Port staff said Parcel F’s earlier adjustment increased 90% AMI units and reduced higher‑AMI units; Parcel A proposal would increase 90% AMI units from 10 to 19, keep 20% AMI units at 54, and eliminate the 50% AMI tier in that parcel (the presentation used AMI shorthand). Staff said some current tenants at higher AMI levels would stay and have rents lowered, with conversion to the new target AMI level upon vacancy. - Net effect on Phase 1: Under the staff proposal, Phase 1 would total about 73 affordable units (the transcript gave a final percentage of approximately 24.8% if counted to decimals), which staff reported as about 25%—below the prior 30% phase minimum but above the city's inclusionary requirement. - Relationship to city goals: Staff reminded the commission that the project-wide affordability target remains 40% across all phases and that the citywide inclusionary housing requirement is lower (staff cited roughly 12.5% in discussion), so Mission Rock would continue to exceed the city’s standard even after the amendment.

Discussion and public comment - Commissioners asked for context about market leasing, commercial leasing, and the need for subsidy. Commissioner Lee asked whether higher‑AMI units were filling because market rents and incomes have changed since pre‑pandemic assumptions; staff responded that rents and incomes across the Bay Area and competitive regional markets shaped leasing demand. - Commissioner Ingle (Commissioner name as recorded) and others emphasized the importance of contextualizing the change: the project still delivers substantially more affordable housing than the city minimum and increases deeper affordability at the 90% AMI tier. - Staff and Mission Rock partners said future phases (including a standalone deeper‑affordability building contemplated for youth/foster youth) remain under discussion as part of a broader restructuring of Phase 2; no final decisions on Phase 2 were made at this meeting.

Action taken - Resolution 25-17 (amend Mission Rock housing plan; conforming changes to Parcel A lease; revise declaration of restrictive covenants) was moved, seconded and adopted. The item will be forwarded to the Board of Supervisors for its action where required.

Ending: Port staff and Mission Rock partners will coordinate follow-up with the Board of Supervisors and report back to the commission as phase‑level and parcel lease changes proceed.