OCII authorizes ENA and $3.5 million predevelopment loan for 140 permanently affordable units at Candlestick Point

The Successor Agency to the San Francisco Redevelopment Agency on Dec. 6 authorized an exclusive negotiations agreement (ENA) and a $3,500,000 predevelopment loan to Tenderloin Neighborhood Development Corporation (TNDC) and Young Community Developers (YCD) to advance the development of 140 permanently affordable rental units at Candlestick Point North, Block 10A.

Gretchen Heckman, a development specialist with OCII’s housing division, told the commission the parcel is part of the Candlestick Point and Hunters Point Shipyard phase 2 disposition and development agreement and that the program environmental impact report adequately covers the action. The project program calls for 140 units (including one manager’s unit), with 25 percent set aside for formerly homeless households (restricted to households earning up to 30 percent of area median income, cited in the presentation as roughly $26,000 for a two-person household) and the remainder targeted at households up to 60 percent AMI. Heckman said the design will prioritize family-sized units: about 80 percent will be two- and three-bedroom apartments and some larger units will meet replacement obligations for Alice Griffith Phase 4, Block 5.

Staff said the ENA requires a $10,000 performance deposit, an initial 18-month term with an option to extend up to 12 months, and a set of milestones including a preliminary financing plan, schematic design and the execution of a ground lease. The requested $3.5 million predevelopment loan carries a 3 percent simple interest rate, will fund architectural and engineering work, surveying, legal and financing costs and developer fees, and will convert to a permanent OCII loan at construction closing. Staff told commissioners the loan’s maximum maturity is three years or until the close of construction financing.

On parking and financing tradeoffs, OCII staff recommended preserving the full 140-unit count and maintaining a 0.6-to-1 parking ratio. Heckman said adding enough parking to serve 100 percent of households would remove roughly 12 housing units and could push per‑unit costs above the threshold at which tax-credit and tax‑exempt bond financing become ineligible; staff cited an eligibility per‑unit ceiling of about $825,000. The presentation included plans for an 84-space controlled-access garage and interim shuttle/transit improvements until the final transit lines are in place.

The applicant selection and outreach process drew staff and community attention: Hunters Point CAC members served on the RFP evaluation panel, and OCII described an early-outreach plan with technical-assistance workshops. OCII staff detailed applicant preference order for the housing lottery: COP holders first; then Ellis‑Act/displaced-tenant preferences; then households that are rent‑burdened; then San Francisco residents or workers; then the general public. Pamela Sims, OCII’s senior development specialist for marketing and COP programs, said OCII maintains a mailing list of approximately 900 active COP holders and will continue proactive outreach and a COP outreach obligation report as the project advances.

Oscar James, a Bayview Hunters Point resident and longtime community organizer, urged the commission to require developer partners to provide workforce training, scholarships and summer-job opportunities for local young people so legacy residents can share in the economic benefits of development.

Commissioner Bustos moved to authorize the ENA and predevelopment loan; the motion was seconded and the roll call vote was unanimous. The commission directed staff and the developer to pursue cost containment strategies and to coordinate outreach and parking-priority protocols with OCII.

Next steps: staff will return with schematic designs, gap financing requests and, once project financing is secured, seek approval to enter into a ground lease so construction financing can close. The presentation projected a possible construction start in February 2019 with completion and full occupancy roughly two years later in 2021.