Committee forwards rental‑incentive agreements for two Dogpatch developments totaling 353 units

The Land Use and Economic Development Committee unanimously forwarded two resolutions approving rental incentive agreements that obligate developers to deed‑restrict new dwelling units as rentals for at least 30 years in exchange for reduced inclusionary housing and lower Eastern Neighborhoods impact fees.

Planning Department staff (Kate Connor) summarized the projects: 2051 Third Street is a six‑story building with 93 dwelling units (33 studios, 22 one‑bedrooms, 35 two‑bedrooms and 3 three‑bedrooms) plus 74 off‑street parking spaces; 1201 Tennessee Street is a six‑story project with 259 units, ground‑floor retail, 147 parking spaces and a unit mix including studios and multi‑bedroom units. Under Planning Code section 4.19.5 the UMU zoning district mechanism allows developers who enter into 30‑year rental agreements to reduce their inclusionary housing on‑site percentage by 3% and reduce Eastern Neighborhoods impact fees by $1 per gross square foot.

Kate Connor told the committee the provision was adopted as part of the Eastern Neighborhoods plan (February 2008) and that UMU zoning carried higher inclusionary requirements (for these parcels, the record indicated a 16% requirement). Supervisor Jane Kim questioned the policy rationale and geographic limits of the incentive given changing market conditions; staff responded that the incentive was intended to spur rental production in formerly industrial UMU districts and that the 30‑year deed restriction preserves rental stock regardless of market fluctuations.

With no public comment on these items, Supervisor Scott Wiener moved and Supervisor Jane Kim seconded forwarding both items to the full Board with a positive recommendation; the committee approved the motion without objection. Planning staff noted only one prior project (2121 Third Street) had used this mechanism to date.