Hello! I’m trying something new with the latest installment of Mission Moves, my newsy development roundup. Instead of wrapping up three items of interest in one piece, we’re going to break it up into separate bites. You’ve got places to be; I get that.
If you missed the first piece of this week’s roundup, read it here. An avocado tree was the latest issue regarding an unusually controversial 19-unit project slated for 18th Street.
Mission Housing moving outside the Mission?
Anytime I leave the Mission to hang in the west side, it feels like a lot of effort. The long Muni rides. The pervasive cold. Knowing how far away I am from taquerias and a dispensary.
But Mission Housing has no anxiety about travel, and hopes to expand its growing presence on the west side. After the Mayor’s Office of Housing and Community Development announced funding opportunities a few days ago, Mission Housing executive director Sam Moss tells me the organization is “very seriously looking at multiple sites,” including one in the Outer Mission and two on the west side.
That means Mission Housing could potentially develop new affordable-housing projects in those locations, or implement capital improvements on existing sites. Moss wouldn’t reveal which sites he’s eyeing yet, but said Mission Housing is applying for both capital improvement and affordable housing funding.
The $92 million offered by the Mayor’s Office of Housing is a big deal, and it’s an affordable housing tool that happens maybe once every few years, Moss said. In short, this money could mean hundreds of new affordable units coming online to San Francisco in the next few years; eligible projects are expected to break ground no later than 2025 or 2026. Of the total available dollars, $32 million is reserved for affordable educator housing, $40 million is for affordable site acquisition, and $20 million is for capital repairs.
The funding tool, known officially as the Notice of Funding Availability, essentially gives developers a chance at securing coveted sites or money for future projects.
These applications can give the edge to nonprofit developers — think Mission Housing, Tenderloin Neighborhood Development Corporation, Mercy Housing, etc. — who may not have the same resources as a market-rate developer, but have a feasible plot of land in mind. For San Franciscans, that means more affordable housing units than market-rate units.
So, how does site acquisition work? Essentially, an interested buyer (in this case, a nonprofit developer) approaches the owner of a site and negotiates a sale price. The interested buyer makes a down payment to claim the site, and the owner signs a contract, which gives the buyer time to do due diligence. Once the developer is pleased and ensures the project is eligible to build, the developer can apply for a city Notice of Funding Availability. If selected and “the timing works out,” Moss said, the city agrees to buy the property, but the developer who found the site proceeds with the development.
But there’s flexibility. The nonprofit can also come in and purchase the site “with the knowledge that after winning the [NOFA] award, the city would eventually take the nonprofit out and repay those initial monies,” Moss said. After the exchange, the city owns it again, ensuring the land stays affordable in the future.
Notices of Funding Availability can speed up new affordable housing construction by years in this way. The city, even if it owns its own land, can be limited by funds or time. For example, the city of San Francisco acquired 1979 Mission St. near 16th St. BART, in November, 2021, but it still needs to assign a developer to build the project. That process, known as a Request for Proposal, won’t take place until late spring or early summer, meaning that, some two years after acquisition, the site still won’t have broken ground on the 330 affordable units. A recently proposed plan to host 60 ‘Tiny Homes‘ for the homeless there is unlikely to come to fruition, too.
And Request for Proposals to develop city-owned land aren’t always available; there’s none open right now, for example.
So how many nonprofits might throw their hat in the ring for the Notice of Funding Availability pool of money? Unclear so far. “The response rate varies based on community needs and nonprofit capacity,” Mayor’s Office of Housing and Community Development spokesperson Anne Stanley wrote via email. Applications are due in April.
But certainly, Mission Housing will be one applicant. Moss is as happy as a clam.
“Having a nonprofit industry in San Francisco that is strong enough to partner and capitalize on these NOFAs is a rarity in the country,” Moss said. “Why not encourage that?”