City plans to limit restaurants, preserve industrial space in SF’s Mission

In an effort to curb gentrification in the Mission District, the San Francisco Planning Department has announced a bevy of proposals, including new controls on restaurants, bars and new businesses, as well as measures to preserve small workshop spaces in certain areas.

The proposals are part of the so-called Mission Action Plan 2020 — a plan aimed at keeping cultural and economic diversity in the neighborhood as it continues to see an influx of wealthier residents, and with them a proliferation of bars and restaurants.

The changes are expected to take effect this summer, following a Planning Commission recommendation and subsequent approval by the Board of Supervisors. District 9 Supervisor Hillary Ronen is expected to introduce the proposals to the board as legislation.

“How many of you know a business that has closed in the neighborhood in the last five to ten years?” Claudia Flores asked a roomful of about 150 mostly Mission District residents who attended the Wednesday night meeting at the Women’s Building.

Many raised their hands.

As Mission Local has reported, however, it’s unclear if much can be done in the face of a changing retail landscape in which brick and mortar shops are closing with the rise of e-commerce, and not always because of the changing demographics.

In its focus on four blocks of Mission Street, Mission Local has found that bars, restaurants and other entertainment venues are the most viable businesses in the neighborhood’s main corridors. And, surprisingly, existing restaurant owners said they would like to see more of the same.

Danny Garland, the bartender at Gashead Tavern, for example, said that more bars will fuel business because patrons “can then hop from one busy location to another and eat at hole-in-the-wall spots, instead of being diverted to Valencia Street.”

Flores said the city said the plan allows for the growth of bars and restaurants. Right now, 20 percent of Mission Street is composed of restaurants, and the plan allows for 25 percent. Flores said the proposals will allow her department to re-examine and adjust the cap.

Diego Sanchez said one of the proposals would cap the number of restaurants and bars that serve alcohol along Mission Street and the immediate areas, limit storefront mergers to no more than 1,500 square feet, and require special authorization for businesses that replace so-called “legacy businesses” that provide character to the neighborhood.   

The plan would also allow non-retail services on the third floors and above. Office space is in demand, and the Planning Department is allowing retail-to-office conversions on the upper floors elsewhere in the city, according to a report in the SF Business Times.

Although the demand for housing is huge, few people take advantage of the ability to convert ground-floor commercial space to residential use with special permission from the city — an idea that people in other cities have acted on.

The new plan would allow light manufacturing on side streets, and conduct a two- and five-year check on the modifications.

At present, Sanchez said, Mission Street is about 20 percent restaurants and bars, 60 percent retail stores, including services such as dentists, optometrists and small grocers, 5 percent government uses, and 15 percent vacancies.

Moreover, as part of another proposal, Sanchez said the city should require special authorization from the city for any new restaurant that serves alcohol, for breweries and vintners that would like to add tasting rooms, and prohibit liquor licenses for manufacturing alcohol in restaurants.

The controls would be contained to an existing area in which the city has restricted liquor stores and bars. That so-called “special use district” is bordered by Cesar Chavez to the south, Capp Street to the West, Potrero to the east, and 14th Street to the north.

“What we’ve heard is there’s a need to tamp down and get back to the original intentions of the special use district, which is to lower the number of restaurants that serve alcohol,” Sanchez said.

Another proposal is aimed at preserving space dedicated to industrial uses, or so-called production, distribution and repair space, said John Francis of the Planning Department.

“There’s been a loss of PDR businesses in the Mission over the years through both illegal conversions and through redevelopment,” he said. “There is demand for PDR space, and it’s growing.”  

Indeed, the PDR vacancy rate was down at the end of 2017 at 2.8 percent, according to a report by CoStar Group, a commercial real estate information company. 

He said industrial space can’t compete, because offices can offer higher rents than industrial business.

“We are looking to preserve PDR in this particular area,” Francis said, mentioning that the plan would mostly extend protections to mostly auto repair shops on South Van Ness between 14th and 19th Streets.

To do this, Francis said, developers must include a certain amount of PDR space in their development if the property previously contained 2,000 square feet or more of the industrial space. Currently, properties containing 5,000 square feet or more require a new development to incorporate industrial space in their project.

While some community members asked about the specific proposals, but their concerns were largely around the availability of new affordable housing.

“Is there a mechanism for developers to build non-luxury housing?” asked one woman.

“I don’t want to hear about 10 percent affordable,” she said. “I want to hear about 100 percent non-luxury housing.”

Of all the questions, hers was met with the loudest applause.

In so many words, Flores said that it would be difficult for the city to have complete control over the mix of market-rate and affordable housing in the neighborhood.

“We live in a market economy,” she said, noting that the most the city can do is require a percentage of affordable housing and community benefits in the projects. “We really don’t have a legal mechanism to say, ‘You can’t build these units.’”