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OCII approves variation for Parcel F; developer to pay up to about $47M for Transbay affordable housing
Summary
The commission approved a variation allowing the Parcel F developer to pay an in'lieu affordable-housing fee (estimated $45'$47 million, about $243,000 per unit) to subsidize affordable housing at Transbay Block 4; the vote was 3'yes, 1'abstention and still requires Board of Supervisors approval.
The Commission on Community Investment and Infrastructure voted Jan. 19 to conditionally allow the developer of Transbay Parcel F to pay an in-lieu affordable-housing fee, instead of providing 33 moderate-income units on site. The fee was presented as a contribution of between $45 million and $47 million, sized at roughly 150% of the city's inclusionary housing fee, and is intended to subsidize approximately 192 affordable units at Transbay Block 4.
Jeff White, OCII housing program manager, explained that Parcel F's residential units are at the top floors of a 61-story mixed-use tower where homeowners association (HOA) fees are expected to exceed $2,500 per month. He told commissioners that state law requires HOA fees to be uniform and that high HOA fees would create a practical difficulty and undue hardship for BMR buyers, increasing risk of resale pressure or foreclosure. Staff said the in-lieu payment would be delivered as an enforceable letter of credit 30 days after the Block 4 DDA effective date and estimated the subsidy at about $243,000 per unit based on current assumptions.
Vice Chair Mara Rosales moved to approve the variation and Commissioner Scott seconded. On roll call, Commissioner Brackett abstained; Commissioners Scott and Rosales and Chair Bustos voted yes. The motion carried (3 ayes, 1 abstention). The commission noted the CAC had recommended the variation and that subsequent approvals — including by the Board of Supervisors and related planning commissions — remain required for the development agreement and funding flow to Block 4.
OCII staff and commissioners discussed that the fee would not replace other financing sources developers of Block 4 might need to pursue; rather, it would be routed through OCII to subsidize the Block 4 affordable podium. Interim Director Sally Orth and staff said the calculation uses the city's inclusionary fee formula with an agreed-upon multiplier and that the exact dollar amount will continue to be refined based on the updated fee factor.
Next steps: If the commission's variation is forwarded, the Board of Supervisors must act in its capacity as the successor agency's legislative body; OCII will then coordinate the letter of credit and the Block 4 disposition-and-development agreement.
