Commission gives intent‑to‑approve to Potrero 59‑unit project, requires Costa‑Hawkins agreement and design refinements

The Planning Commission on Sept. 15 adopted a motion of intent to approve a large project authorization for 249 Pennsylvania Avenue (Potrero Hill), a proposed four‑story, 59‑unit mixed‑use development that would demolish two existing PDR buildings and provide ~3,400 square feet of ground‑floor PDR, approximately 44 off‑street parking spaces, and roughly 15,000 square feet of common open space including a roof deck.

Planning staff told the commission that the sponsor changed the approach to meet inclusionary requirements: instead of paying an in‑lieu fee, the project now proposes 10 on‑site below‑market‑rate (BMR) rental units (one of them a 3‑bedroom) under the updated Prop C rules. Because on‑site rentals require execution of a Costa‑Hawkins agreement, staff recommended a motion of intent to approve and that the commission continue final action until the Costa‑Hawkins agreement is in place.

Project representatives described outreach with neighbors and the relocation plan for Center Hardware, said the project would pay roughly $1,000,000 in neighborhood fees and offered a community benefit package (including $35,000 to the adjacent Pennsylvania Street Gardens). Commissioners generally praised unit design and the project’s stepped massing but asked the sponsor to refine the proposed green wall on the freeway‑facing elevation and to provide clearer 3‑D depictions of that wall. Commissioner Moore conditioned his support on design changes and the Costa‑Hawkins agreement.

The commission adopted the motion of intent to approve with conditions (design refinements, Costa‑Hawkins agreement) and continued the item for final action on Nov. 3. Staff will return the item with the executed rental agreement and any required code‑compliance materials.