SAN FRANCISCO-Construction is under way at the first project in an ambitious initiative to transform eight aging and isolated public housing developments in the city.
After years of planning, The John Stewart Co., Devine & Gong, Inc., and Ridgepoint Non-Profit Housing Corp. have begun rebuilding Hunters View, a 22-acre site consisting of 267 public housing units built in 1956.
It’s the lead-off project in the bold HOPE SF initiative, which aims to rebuild 2,500 public housing units into new mixed-income communities that could bring 6,000 new housing units to the city. The other projects are Alice Griffith, Sunnydale, Potrero Annex/Terrace, Westside Courts, Hunters Point, and Westbrook/Hunters Point East.
Although the effort shares some similarities with the federal HOPE VI program that’s revitalized the nation’s most distressed public housing units, local backers say their plans are unique on several points.
For one, city officials did not wait around for elusive HOPE VI funding. Instead, they launched the initiative using other sources, including bond funds from the city, low-income housing tax credits (LIHTCs), and contributions from philanthropic organizations.
“The city’s initial $95 million commitment was critical and very unusual,” said Rich Gross, vice president and market leader in Northern California for Enterprise, one of the partners in the massive effort. “In addition, the combination of development financing that included federal, state, and local financing and the long-term commitment of human service funding makes this different than any other initiative. The scale and commitment to current residents is also innovative. Pulling in the private sector and building support for HOPE SF as a civic responsibility is an important aspect.”
It’s important to note that key federal funding recently entered the picture when McCormack Baron Salazar and the San Francisco Housing Authority (SFHA) received $30.5 million for the Alice Griffith redevelopment at the end of August. It was one of only five projects nationwide to receive a Choice Neighborhoods implementation grant from the Department of Housing and Urban Development. The new program builds on the HOPE VI model while promoting a more comprehensive approach to neighborhood development.
Funding isn’t the way in which HOPE SF stands out. Participants are also pledging a one-for-one replacement of all the public housing units without mass displacement of current residents. And, they’re committing to meeting ambitious hiring goals that call for using local contractors and hiring public housing residents. Developers will also be using green building products and techniques.
“It’s being done with that San Francisco flair,” said Jack Gardner, president and CEO of The John Stewart Co.
Hunters View leads the way
HOPE SF is on a similar scale as the massive transformation that’s happened in Atlanta and Chicago, said Henry Alvarez III, SFHA executive director, who estimates the initiative will add to more than $1 billion in development.
“I don’t think I ever dreamed I would be involved in something like this,” he said.
The effort has started with Hunters View, which will be done in several phases and has the potential to bring 800 new housing units to the site. That would be roughly 350 affordable apartments, 50 affordable for-sale units, and another 400 market-rate for-sale homes.
Costing roughly $62 million, the first phase will provide 107 units, including 80 public housing replacement units and 27 straight LIHTC apartments.
The team recently closed on the financing of this first step. The funding package includes a $41 million construction loan from Citi Community Capital and $29.2 million in low-income housing tax credit equity from syndicator Enterprise and investor Bank of America. The city is providing a $12.6 million loan that’s coming from a $95 million bond issue and another $9.8 million from the redevelopment agency. The state department of Housing and Community Development is also a key partner, contributing nearly $18 million from different programs.
Developers have demolished 113 units, with residents of those units moving to vacant apartments on site, so there’s been no displacement.
There’s no place where there is a greater commitment to current residents, Gross said.
Gardner agreed, citing a unique job placement program as one example. In these early days of construction, the team is outpacing the goals that call for 50 percent of the total hours in each trade to be worked by San Francisco residents and 25 percent of the total workforce to be made up of housing authority residents.
Urban Strategies, Inc., a St. Louis-based nonprofit that has often worked with its development partner, McCormack Baron Salazar, is on scene at Hunters View, providing outreach to residents.
With construction under way at Hunters View and funding lining up for Alice Griffith, HOPE SF is on its way.