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Real estate director outlines redesigned Station 13 plan; developer to cover higher construction costs
Summary
The city—s Real Estate director said RelatedCompanies reworked the 530 Sansom Street project to enlarge a new Station 13, add a fourth apparatus bay and swap condos for office space; the developer has agreed to cover roughly $5.7 million in increased delivery costs and to pay a $1.6 million voluntary fee, officials said.
Andrico Penek, director of the City and County of San Francisco—s Real Estate Department, told the Fire Commission that the 530 Sansom Street development has been redesigned to enlarge the new Fire Station 13 and shift market-rate housing components to office space.
Penek said the station footprint would grow from about 19,266 square feet to roughly 20,300 square feet and include a fourth apparatus bay. The developer, Related Companies, has replaced an earlier plan for 35 for-sale condominiums with about 40,000 square feet of office. Penek said that change reduced the city—s expected housing linkage and in-lieu revenues, and Related has agreed to a voluntary $1.6 million payment to offset that shortfall.
"The developer has agreed to cover the increasing costs for the delivery of the first-class next-generation fire station," Penek said, adding that the current construction budget for the station is about $31,200,000, up from an earlier figure near $25,000,000. "This cost increase will be borne by the developer," he said.
Why it matters: Penek emphasized the project is structured so the city will not spend general-fund dollars on the station; the conditional property exchange agreement (CPEA) and ancillary deals are contingent on CEQA clearance, Board of Supervisors and mayoral approval. He also said some project revenue could flow to the general fund if Related purchases transfer-development rights (TDR) from the city.
Commissioners pressed Penek on market and execution risk. Vice President Catherine Feinstein asked whether the station is guaranteed if the tower component proves unprofitable. Penek replied the property exchange is conditional, "we will not be handing over the deed for the city property until we have a fire station that we're satisfied with," and the developer bears escalation risk. He said standard contract remedies and surety bonds protect the city if the developer defaults or the project stalls.
Penek described next steps as entitlements and permitting after CEQA; he projected permitting activity during 2021 and start of construction in early 2022, with occupancy by the end of 2023 if approvals proceed on schedule. He acknowledged some details remain in flux — including the final hotel room count and exact parking configuration — and deferred operational relocation questions during demolition to the Fire Department.
No formal action was taken by the commission on the presentation. Commissioners asked about relocation of Station 13 personnel during demolition, timeline contingencies, and parking for station staff; Penek said relocation plans will be developed with the Fire Department as the city approaches demolition.
Authorities referenced in the presentation included the conditional property exchange agreement (CPEA) and CEQA review; Penek said the Budget and Finance Committee and Board of Supervisors have already reviewed conditional changes and that the project received positive recommendations in recent board hearings.
The presentation closed with Penek noting the developer had increased its financial participation "at a time when the property value of the city has actually declined," and that the arrangement is intended to deliver a modern station without a direct city capital outlay.
