A parking lot at 15th Street and South Van Ness Avenue may yet become a 10-story building with 231 units — all marketed by its Kansas-based developers as “affordable by design.”

“The proposed group housing project is a modern-day version of the affordable SRO hotels that were populated by San Francisco’s working-class, transient laborers, and immigrants during the last century,” the plans say. 

The plans were submitted by Elsey Partners, LLC, a Kansas-based developer. The project would include 166 small studio apartments, with 12 of those being below-market-rate (the state density bonus is being evoked to sidestep city affordability requirements). 

Additionally, the project would include 65 “sleeping spaces” whose occupants would use shared kitchens, bathrooms and common areas. The plans describe a vast majority of the units as “affordable market-rate.”  

“Market rate” rent for a studio is around $2,569 per month — it’s unclear whether these apartments would be affordable for the “working class,” let alone “transient laborers.”

“If they have Section 8 vouchers, they could rent one of these units,” said Chris Elsey, a principal with Elsey Partners, LLC — though he acknowledged the vouchers are exceedingly difficult to obtain in San Francisco. 

Questions regarding the project’s affordability will likely prompt opposition from neighborhood activists. They have already placed terms on the table for Elsey’s nearly identical project across the street at 1500 15th St. The developers have been working to get that project approved since November 2016.

In exchange for not delaying that project, representatives of the nonprofit coalition United to Save the Mission asked for the project’s rent to be set at Section 8 rates — right now, $2,215 per month for a studio — “in perpetuity.” 

Carlos Bocanegra, a member of United to Save the Mission’s Community Development Committee, said the “framework would have allowed the project to equitably benefit the Mission community by offering Section 8 housing to its recipients, veterans, and other working-class families with similar subsidy, while ensuring profitability for the development team.”

But Elsey was not amenable to such a long-term commitment, he said — although he was willing to set his rents at those lower rates for three years. The parties did not come to an agreement. 

“I’m not willing to commit to something forever,” Elsey said, noting that the market can and likely would change decades into the future. “Who commits to a deal forever? Nobody. It’s basic Business 101.” 

In light of this, Bocanegra said the coalition has “no choice but to oppose” to 1500 15th St., though he hoped the two parties could work together in the future. Nevertheless, the newly proposed project at 401 South Van Ness Ave. may encounter similar resistance.

In addition to the housing, the plans include 2,978 square feet of retail space and 2,185 square feet for offices. The project’s estimated cost: $47.5 million.

Like many developers who have pitched plans in San Francisco and its Mission District, Elsey bemoaned the city’s yearslong process for development. 

“I hope it’s not another three years till I get close,” Elsey said. “Hopefully, someone can figure out how to build something faster.”

Editor’s Note:  Carlos Bocanegra, a spokesperson for United to Save the Mission, wanted a change to our story. Instead of asking for one or talking to the reporter about his concerns, he immediately attacked Julian Mark’s integrity — in comments on this page, in social media posts, and in emails to Julian, myself and Joe Eskenazi, our managing editor.

It took several emails and a phone call for me to get beyond the vitriol and understand what Mr. Bocanegra felt was left out.  

The article reported United to Save the Mission’s proposal that the developer of the project would set rent at Section 8 rates — right now, $2,215 per month for a studio — “in perpetuity.”  The agreement, according to Bocanegra’s statement also “would have guaranteed that the developer maintain the healthy profitability level that they had set for themselves (the DSCR) by allowing the project to potentially lease vacant units at full market-rate prices if it was needed in order to stay at the prescribed level of financial return.”  

We left out United to Save the Mission’s agreement to also allow the developer to “maintain the healthy profitability,” deciding that it was less important since the developer said the deal failed because he would not sign anything “in perpetuity.” 

Bocanegra saw Mission United’s willingness to allow for a profit as essential. It did not seem so to us, but readers have the full statement below or at this link and can decide for themselves.

We hope that in the future, issues can be discussed in a more civil manner. Name-calling and threats do little for discourse.   

Lydia Chávez, Executive Editor