Housing plan grows for Lucky Penny site
Home-SF, the new city law that allows builders to increase height and density in exchange for providing more affordable housing units, is moving from the conceptual to the real.
The owner of the site of the Lucky Penny, the Laurel Heights 24-hour greasy spoon that attracted generations of night owls with its patty melts and hash browns, plans to build 121 units of housing at 2670 Geary Blvd., the curved lot at the busy corner of Masonic Avenue. The Lucky Penny closed in 2015.
The unit count represents a dramatic increase from the 21 units allowed under the current zoning. The developer, a subsidiary of Presidio Bay Ventures, had been frustrated for years by the zoning, which only allows one unit of housing for each 600 square feet of surface. Presidio Bay first explored building a mix of housing, medical office and retail, but the concept was not economically feasible, said Cyrus Sanandaji, a managing partner.
The company then worked on legislation that would have allowed 98 units through the creation of a special use district. But in May the Board of Supervisors passed Home-SF, and its guidelines allowed for 121 housing rental units in a 10-story building. The project will go to the Planning Commission for approval on Sept. 7.
“We are proud to be able to put together the first Home-SF project at a time when the housing crisis is only getting worse,” Sanandaji said. “These are going to be very affordable housing units — our idea was to develop a project that is accessible to all at the middle-income level.”
The housing density law, which took two years to craft, allows developers to build taller and denser residential
structures in exchange for making 30 percent of the units affordable.
Supervisor Katy Tang first proposed the city density law in 2015 as a means to produce more homes for middle-class families who don’t qualify for federally subsidized housing, but the bill died in the face of opposition from both her progressive colleagues, who criticized it as a developer giveaway, and from westside homeowners, who said it would cause new real estate projects to flood their neighborhoods.
But Tang managed to revive the law this year, amid increased interest in helping the teachers, firefighters, nonprofit workers and small business owners who are increasingly unable to afford housing in San Francisco.
The Lucky Penny development will have 41 affordable units, compared with just three if the original 21-unit project had gone forward.
“It’s incredibly exciting to see that Home-SF is actually being utilized, that it wasn’t just a symbolic exercise,” Tang said. “I think we’ll see more developers come in with Home-SF projects, particularly in transit corridors like Geary, where the zoning is not favorable for new housing.”
City planners are hoping that Home-SF will eventually spark the creation of 15,000 units, 5,000 of which would be below market rate, including some set aside for families earning from 90 percent to 130 percent of the area median income, which for a family of four is between $103,750 to $155,650.
While the Lucky Penny is the first project to seek a density increase under Home-SF, others are in line. Supervisor Ahsha Safai, who worked with Tang on the legislation, said the owner of the former Joe’s Cable Car burger joint on the corner of Mission Street and Silver Avenue, will likely use the law to increase a proposed project from a dozen units to 40 or 50.
“It would be a wasted opportunity to have a site like that, in this housing crisis, and just develop 11 or 12 units on that prominent a corner,” Safia said.
At a time when many new developments are dominated by studios and one-bedroom units, Home-SF also seeks to carter to families by requiring that 50 percent of the units be two bedrooms or more.
“We need to continue to find creative and common-sense solutions for affordable housing, and Home-SF is the latest program that will provide the hard-working people of this city the homes they need,” Mayor Ed Lee said.
AnMarie Rodgers, senior policy director at the Planning Department, said the Lucky Penny project “is exactly the sort of outcome that Home-SF was crafted to produce.”
“This is boon to people who are struggling — especially families,” Rodgers said.
Carly Grob, housing implementation planner withe Planning Department, said several other developers, including one with a project on 40th Avenue in the Sunset District, are redesigning already approved projects to increase density under Home-SF. Those projects will have to go back before the Planning Commission for new approvals, but the process would be streamlined.
For Laurel Heights, which has not seen a major housing project in more than a decade, the Lucky Penny project will bring new residents and increased pedestrian traffic. Also coming are the redevelopment of both the UCSF and California Pacific campuses on California Street, though both are years away.
“Not much has come out of the ground in that area. It’s areally underserved area in terms of housing,” Sanandaji said.
And while it’s unlikely that an old-school diner will open in the 1,800 square feet of ground floor retail, there will be “some homage to the Lucky Penny” in the development.
“We’re still toying with ideas,” Sanandaji said.
“It opportunitywould be to a wastedhave a site like that, in this housing crisis, and just develop 11 or 12 units.” Ahsha Safai, S.F. supervisor