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Committee advances Project CHESS conditional acquisition of 1500 Mission Street; project would consolidate city services and deliver housing
Summary
The committee endorsed a conditional land disposition and acquisition agreement for 1500 Mission Street (Project CHESS), a mixed‑use plan estimated at $327 million that would create about 463,300 sq ft of city offices (≈1,300 employees), about 550 residential units with 20% on‑site affordable, LEED Gold targets, and local hire/LBE commitments; the item was forwarded to the full board as a policy matter.
The Budget and Finance Committee advanced a major real‑estate transaction known as Project CHESS — a conditional land disposition and acquisition agreement for property at 1500–1580 Mission Street — which the city would use to consolidate permitting and other departmental offices into a single campus while enabling a large mixed‑use development by the developer partner.
City real‑estate staff described the project as a cross‑departmental effort involving 13 properties and 12 departments to consolidate permitting functions into a one‑stop permitting center and consolidate approximately 100,000 square feet of leased space into city‑owned space. City staff said the conditional agreement caps the city’s predevelopment obligation at about $8,072,300; the total project cost was stated as approximately $327,000,000 (with additional pro forma costs raising a total to roughly $338,900,000 when accounting for furniture, moving, and IT) and the city’s office component was estimated at about 463,300 gross square feet for roughly 1,300 employees.
Related California (Bill Witte) described the mixed‑use program and cited prior local development experience. Staff said the project expects to provide approximately 550 residential units, with a 20 percent on‑site affordable set‑aside (about 110 below‑market units), about one acre of retail/restaurant space, and LEED Gold as a minimum sustainability standard. The presentation described local hire and LBE targets in the project agreements (construction trade hours 30%, disadvantaged construction trade hours 15%, apprentice hours 50%, disadvantaged apprentice hours 25%, predevelopment LBE participation 20%, construction LBE participation 15%) and said the project would not seek exemptions from childcare requirements.
Budget and legislative analyst Mr. Rose emphasized the policy nature of the item because of the future commitment of significant city funds and recommended a small technical amendment (updated gross square footage from 466,400 to 463,300). Staff said CEQA remains to be completed and the transaction would return to the board later in 2016 to ratify the conditional agreement and present debt authority. The committee approved the recommended amendment and approved moving the ordinances forward; the budget analyst’s office characterized the matter as a policy decision for the full Board of Supervisors.
Outcome: conditional land disposition and acquisition agreement advanced to the full board as a policy matter; CEQA and debt authorization to follow.
