In West Hollywood, California, industry professionals say something unusual has occurred at a three-decade-old residential complex along La Cienega Boulevard: Parking, laundry rooms and excess storage were overhauled to become a half-dozen new apartments.

LaTerra Development, a Los Angeles-based multifamily owner and developer, converted these non-living spaces at 1121 N. La Cienega Blvd. into studio apartments in what real estate professionals say could be the most expansive use of building more apartment units in a single building using California’s Assembly Bill 68.

The law, signed in 2020, allows for more accessory dwelling unit construction in existing single-family and multifamily properties. The law was an attempt by the state to create incentives for more housing construction to ease an acute shortage of residential properties.

Other states and cities around the country, including Seattle, Chicago and Minneapolis, have adopted similar measures to permit these so-called ADUs in response to soaring housing costs.

In California, single-family homeowners have been the best-known adopters of the law, adding ADUs in their backyards and leasing out the space. However, some apartment owners have just begun looking at how to take advantage of the law, too, which could result in hundreds of new multifamily units added in greater Los Angeles, according to Chris Tourtellotte, managing director of LaTerra.

“We paved the way a little bit,” Tourtellotte said of building the ADUs on the La Cienega Boulevard property.

It’s still not common to see new ADUs built in existing apartment complexes, according to Jeremy Nova, founder of Louisville, Colorado-based Studio Shed, which makes and sells prefabricated ADUs across the United States.

“We’re seeing more ADUs being integrated into new developments” such as so-called microcommunities, a relatively new term — something between urban and suburban living — for a cluster of small residences on the same block, Nova said, as opposed to putting ADUs into existing apartment buildings.

In Los Angeles, ADU construction is growing in popularity. The city issued 100 permits for ADUs in 2016, but by 2022, that number rose to roughly 7,000, according to the Bipartisan Policy Center, a Washington, D.C.-based nonprofit that promotes solutions to a variety of issues facing the United States. A breakdown of what percentage ADU construction has occurred so far at greater Los Angeles apartment complexes wasn’t available to CoStar News.

New studio apartment kitchens at 1121 N. La Cienega Blvd. in West Hollywood, California, feature modern finishes and stainless steel appliances. (Jack Witthaus/CoStar)

Despite LaTerra’s project being the firm’s first ADU attempt, it’s difficult to tell that the units weren’t original to the 33-year-old property. An existing courtyard opens up to three of the studios, which have windows letting in natural light along with modern appliances, cabinets and finishes. A newly created hallway connecting to the courtyard leads to the other three units. Each unit has a doorbell and entryway sconce.

LaTerra created the new units in 15 months between getting plans approved with the city and wrapping up construction, Tourtellotte said. The state law allows apartment owners to skip the entitlement process, which hastens the timeline.

For ground-up apartment construction in West Hollywood, the planning, entitlement and building process would have taken years longer and cost at least $800,000 to build each unit, according to Tourtellotte. For the ADUs on La Cienega Boulevard, LaTerra spent roughly $300,000 for each unit.

The developer bought the property for $29.2 million in late 2021, according to CoStar data. Beyond adding ADUs, LaTerra has been renovating older apartments at the property, including adding washers and dryers after replacing the laundry rooms with living space. Despite the ADUs, the property still has adequate parking, including those serving the new units, Tourtellotte said.

The ADU process wasn’t without challenges. LaTerra needed to move residents’ parking spaces around when construction started, and hooking up mechanical, electrical and plumbing to the new units proved difficult, according to Tourtellotte.

Plus, the developer and architect, Los Angeles-based Urban Architecture Lab, weren’t using a previous design model because it was their first time involved in such a project. They had to work with West Hollywood officials, too, on explaining the state law, Tourtellotte said. The city hadn’t encountered construction like this before.

The roughly 695-square-foot ADU studios have hit the market for $3,100 a month. While that seems pricey and not what affordable housing advocates would support, West Hollywood is among the most desirable apartment markets in greater Los Angeles due to its walkability, nightlife and restaurants and its Westside location, said Ryan Patap, senior director of market analytics for CoStar Group in Los Angeles. Further, few new apartments are built in West Hollywood, meaning that any new construction commands high pricing.

Patap said LaTerra’s ADU pricing is below what a new studio would go for in West Hollywood due to the high demand for living there. The ADUs are the lowest-priced units in the complex, according to Tourtellotte.

Beyond the West Hollywood apartment building, it’s not uncommon for new studios in greater Los Angeles to top $4,000 per month. Figueroa Eight, a newly built apartment tower in downtown Los Angeles, is marketing 625-square-foot studios for $4,105 per month.

This empty space at 1121 N. La Cienega Blvd. could one day be converted into an accessory dwelling unit, or ADU. (Jack Witthaus/CoStar)

California leads the nation with ADU construction after residential owners applied for more than 30,000 permits in 2022, according to San Francisco-based ADU digital marketplace Cottage, which tracks this data. In fact, one in six houses built in 2022 in California was an ADU.

Increasing housing density, especially in areas connected by mass transit, has emerged as a California strategy in recent years. Past policy has favored single-family zoning.

Lawmakers say high housing costs have undermined the state’s economic competitiveness and contributed to many companies and residents moving to more affordable places such as Arizona and Texas. Building ADUs, also known as casitas in California or granny flats elsewhere in the United States, is viewed as one way to address the issue.

However, other states and cities adopting ADU ordinances have seen a mixed amount of demand. Seattle saw 2,254 applications for ADU permits in 2022, which was a 25% year-over-year increase, according to Cottage. But in Minneapolis, only 176 building permits were issued for ADU structures between 2014-2022, according to the Star Tribune.

Looking ahead, LaTerra is interested in adding a few more ADU units at the La Cienega Boulevard property and some of its other California multifamily complexes. Tourtellotte said he looks at apartment properties differently now because of the ADU construction experience. When he tours multifamily sites, he said he finds himself thinking about where to add new ADUs.

Tourtellotte said that the best apartment candidates for ADUs are ones that are low-density, have ample parking and feature storage spaces or laundry rooms. Some California apartment brokers are starting to market multifamily properties with ADU potential, showing that the trend of building these apartment units is catching on, Tourtellotte said.

“It’s a whole new way to add value,” Tourtellotte said.

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After Arrest in United Kingdom, Zhang Li Admits Role in Scheme to Bribe Mohammed Nuru; Zhang’s U.S.-based Real Estate Development Company also Charged

October 16, 2023 – SAN FRANCISCO – Zhang Li, founder and chief executive officer of a Chinese real estate development company appeared last night in U.S. District Court on charges that he bribed former head of the San Francisco Department of Public Works Mohammed Nuru, announced First Assistant United States Attorney Patrick Robbins, Federal Bureau of Investigation Special Agent in Charge Robert K. Tripp, and Internal Revenue Service-Criminal Investigation Special Agent in Charge Darren Lian. A U.S. company that Zhang controls, Z&L Properties, Inc., was also charged with honest services wire fraud for providing bribes and gifts to Nuru in exchange for favorable city treatment of Z&L Properties’ mixed-use project at 555 Fulton Street in San Francisco, Calif. As part of a negotiated disposition both Zhang and Z&L Properties will waive the right to indictment and admit that they engaged in certain conduct.

Zhang, 70, of Guangzhou, China, has been charged by Information with one count of conspiracy to commit honest services fraud. According to the Information, Zhang bribed Nuru by providing him with food, drinks, luxury lodging, and transportation during a trip Nuru took to China in 2018. The Information alleges the purpose of the bribe was to influence Nuru so that he would provide favorable treatment on decisions and city approvals needed during the construction and development of a mixed-use property at 555 Fulton Street in San Francisco being developed by Zhang and a company Zhang controlled.

Z&L Properties Inc., a U.S. company formerly based in Fremont, Calif., and controlled by Zhang, was also charged in a separate Information with conspiracy to commit honest services fraud and honest services wire fraud for its participation in the bribery scheme. Z&L Properties managed the development of the 555 Fulton Street project and the company facilitated the payment of bribes to Nuru in exchange for favorable treatment regarding the 555 Fulton project, according to the allegations in the criminal Information.

“Zhang Li and Z&L Properties have admitted that they bribed a top San Francisco public official. The criminal charges and resolutions announced today send a clear message that this office will not tolerate the corruption of public officials in the District by anyone, including individuals acting from outside of the United States,” said First Assistant U.S. Attorney Patrick Robbins. “To those who seek to corrupt public officials in the United States, wherever they are, we will use the powers at our disposal to bring them to justice and hold them accountable to the rule of law.”

“Zhang Li, who earned his profits through bribery of a San Francisco public official, is yet another individual charged in connection to our ongoing public corruption case,” said FBI Special Agent in Charge Robert Tripp. “Public corruption erodes public confidence and strikes at the very foundation of our government. The citizens of San Francisco deserve better, and we stand firmly committed to investigating both corrupt officials and private citizens who attempt to bribe them, no matter where they reside.”

“IRS-Criminal Investigation’s priority is to ensure a fair and level playing field for all taxpayers,” said Special Agent in Charge Darren Lian of the Oakland Field Office. “Mr. Li’s conduct shows that greed and financial crimes have no borders, and we will continue to pursue those who take advantage of our system and taxpayers by following the money worldwide. We are proud to have worked alongside our federal law enforcement partners and the U.S. Attorney’s Office in bringing this case a step closer to closure.”

Zhang originally was charged by criminal complaint in May of 2021. At the request of the United States, Zhang was arrested when he arrived in the United Kingdom in December 2022 and the United States pursued extradition. After approximately six months, Zhang consented to extradition and was subsequently surrendered to U.S. authorities. The charges against Zhang now are set forth in an Information filed by the government.

Zhang appeared yesterday before U.S. Magistrate Judge Alex Tse in the Northern District of California. Magistrate Judge Tse released Zhang on a bond pending further proceedings.

According to the documents filed in Zhang’s case, the defendant and the U.S. Attorney’s Office have entered a deferred prosecution agreement. Under that agreement filed today, Zhang admitted to the conduct that forms the basis of the charge in the Information, and, if Zhang abides by the terms of the deferred prosecution agreement, the charge will be dismissed in three years.

According to filed documents, Z&L Properties also will plead guilty to charges set out in the Information filed against it; Z&L also will agree to a comprehensive compliance and remediation program designed to prevent bribery and corruption in connection with Z&L Properties’ real estate development work. Z&L Properties has agreed to plead guilty to one count of conspiracy to commit honest services wire fraud and one count of honest services wire fraud, will pay a fine of $1,000,000, and will enter into a corporate compliance program acceptable to the Office of the U.S. Attorney. Z&L Properties appeared before U.S. Magistrate Judge Alex Tse today, and the court set a further hearing before U.S. District Judge William H. Orrick, on August 10, 2023, at 1:30 p.m.

The charges against Zhang and Z&L Properties arose from an investigation into bribery and public corruption in San Francisco city government led by the U.S. Attorney’s Office, the FBI, and IRS-CI. To date, more than 14 individuals and entities have been charged in connection that larger set of investigations, including Mohammed Nuru, former director of the San Francisco Public Works department; Harlan Kelly, the former general manager of the San Francisco Public Utilities Commission; and multiple city contractors and other facilitators of bribes and corruption.

Nuru was charged in January 2020, pleaded guilty in January 2022, and on August 25, 2022, Nuru was sentenced to 84 months in federal prison. A separate defendant charged in the investigation, Walter Wong, was charged in June 2020 with conspiracy to defraud the public of its right to honest services and with conspiracy to engage in money laundering, both involving Nuru. Wong entered a guilty plea and agreed to cooperate with the government’s San Francisco City Hall corruption investigation.

An Information merely alleges that crimes have been committed, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt. If convicted, the defendant Zhang faces a maximum sentence of 20 years imprisonment, a maximum fine of $250,000, plus restitution if appropriate. Z&L Properties faces a maximum fine of $500,000 per count, plus restitution if appropriate. However, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.

The case is being prosecuted by the Corporate and Securities Fraud Section of the U.S. Attorney’s Office for the Northern District of California. Assistant U.S. Attorneys David Ward and Robert Leach are prosecuting the case. The prosecution is the result of an investigation by the FBI and the Internal Revenue Service-Criminal Investigations (IRS-CI). First Assistant U.S. Attorney Patrick Robbins thanked the Department of Justice’s Office of International Affairs and United Kingdom authorities for their assistance in the extradition.

Source: DOJ Release

Related:

Property Developer Z&L Properties Fined $1 Million After Pleading Guilty To Honest Services Fraud Conspiracy

Company Admitted Its Chairman Bribed Former San Francisco Department of Public Works Head Mohammed Nuru with Meals, Hotel Stay During China Trip

October 16, 2023 – SAN FRANCISCO – Z&L Properties Inc., a Foster City, California-based subsidiary of a Chinese property development company, was ordered to pay a $1 million fine as part of its sentence for bribing a San Francisco official in exchange for favorable treatment on a construction project, announced First Assistant United States Attorney Patrick D. Robbins and Federal Bureau of Investigation, San Francisco Field Office, Special Agent in Charge Robert K. Tripp. The sentence was handed down by the Hon. William H. Orrick, United States District Judge.

According to the plea agreement, Z&L Properties’ executives approved or paid bribes to former San Francisco Department of Public Works Director Mohammed Nuru, including providing him and another individual with food, drinks, lodging, and transportation during a trip to China in 2018. The purpose of the payments was to influence Nuru to act favorably on Z&L Properties’ requests for city approvals needed to complete construction of a mixed-use property owned by Z&L Properties at 555 Fulton Street in San Francisco.

Z&L Properties was charged by Information on July 18, 2023, with one count of conspiracy to commit honest services wire fraud and one count of honest services wire fraud. Z&L Properties pleaded guilty to the criminal scheme on August 17, 2023. In addition to the $1 million fine, Judge Orrick ordered Z&L Properties to implement a three-year anti-corruption corporate compliance program.

Also charged in the scheme was Zhang Li, 70, of Guangzhou, China. Zhang was the owner and controlling member of Z&L Properties as well as the chairman, co-founder, and chief executive officer of R&F Properties Co. Ltd., a real estate holdings and development company based in Guangzhou, China. R&F Properties does business in the United States through Z&L Properties Ltd. Zhang was charged by Criminal Complaint for his role in bribing Nuru. Zhang was arrested in London in November 2022 on an arrest warrant issued in the Northern District of California. He was required to post a £15 million ($19.1 million) bond and remained under house arrest in London for seven months before being extradited to the United States. Zhang waived extradition in June, returned to the United States, and entered into a deferred prosecution agreement with the United States.

This case is part of a larger federal investigation targeting public corruption in the City and County of San Francisco. Nuru was charged in January 2020 with a long-running honest services fraud scheme. Nuru pleaded guilty to several charges on January 6, 2022, and was sentenced to serve 84 months in federal prison on August 25, 2022. Another defendant, Wing Lok “Walter” Wong was charged in June 2020 with conspiracy to defraud the public of its right to honest services and with conspiracy to engage in money laundering, both involving Nuru and others. Wong entered a guilty plea and agreed to cooperate with the government’s corruption investigations. Judge Orrick has scheduled Wong’s sentencing hearing for January 18, 2024.

Assistant United States Attorney David Ward is prosecuting the case. The prosecution is the result of a multi-year investigation by the Federal Bureau of Investigation and the Internal Revenue Service – Criminal Investigation.
Source: DOJ Release

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SAN FRANCISCO – Zhang Li, founder and chief executive officer of a Chinese real estate development company appeared last night in U.S. District Court on charges that he bribed former head of the San Francisco Department of Public Works Mohammed Nuru, announced First Assistant United States Attorney Patrick Robbins, Federal Bureau of Investigation Special Agent in Charge Robert K. Tripp, and Internal Revenue Service-Criminal Investigation Special Agent in Charge Darren Lian. A U.S. company that Zhang controls, Z&L Properties, Inc., was also charged with honest services wire fraud for providing bribes and gifts to Nuru in exchange for favorable city treatment of Z&L Properties’ mixed-use project at 555 Fulton Street in San Francisco, Calif. As part of a negotiated disposition both Zhang and Z&L Properties will waive the right to indictment and admit that they engaged in certain conduct.

Zhang, 70, of Guangzhou, China, has been charged by Information with one count of conspiracy to commit honest services fraud. According to the Information, Zhang bribed Nuru by providing him with food, drinks, luxury lodging, and transportation during a trip Nuru took to China in 2018. The Information alleges the purpose of the bribe was to influence Nuru so that he would provide favorable treatment on decisions and city approvals needed during the construction and development of a mixed-use property at 555 Fulton Street in San Francisco being developed by Zhang and a company Zhang controlled.

Z&L Properties Inc., a U.S. company formerly based in Fremont, Calif., and controlled by Zhang, was also charged in a separate Information with conspiracy to commit honest services fraud and honest services wire fraud for its participation in the bribery scheme. Z&L Properties managed the development of the 555 Fulton Street project and the company facilitated the payment of bribes to Nuru in exchange for favorable treatment regarding the 555 Fulton project, according to the allegations in the criminal Information.

“Zhang Li and Z&L Properties have admitted that they bribed a top San Francisco public official. The criminal charges and resolutions announced today send a clear message that this office will not tolerate the corruption of public officials in the District by anyone, including individuals acting from outside of the United States,” said First Assistant U.S. Attorney Patrick Robbins. “To those who seek to corrupt public officials in the United States, wherever they are, we will use the powers at our disposal to bring them to justice and hold them accountable to the rule of law.”

“Zhang Li, who earned his profits through bribery of a San Francisco public official, is yet another individual charged in connection to our ongoing public corruption case,” said FBI Special Agent in Charge Robert Tripp. “Public corruption erodes public confidence and strikes at the very foundation of our government. The citizens of San Francisco deserve better, and we stand firmly committed to investigating both corrupt officials and private citizens who attempt to bribe them, no matter where they reside.”

“IRS-Criminal Investigation’s priority is to ensure a fair and level playing field for all taxpayers,” said Special Agent in Charge Darren Lian of the Oakland Field Office. “Mr. Li’s conduct shows that greed and financial crimes have no borders, and we will continue to pursue those who take advantage of our system and taxpayers by following the money worldwide. We are proud to have worked alongside our federal law enforcement partners and the U.S. Attorney’s Office in bringing this case a step closer to closure.”

Zhang originally was charged by criminal complaint in May of 2021. At the request of the United States, Zhang was arrested when he arrived in the United Kingdom in December 2022 and the United States pursued extradition. After approximately six months, Zhang consented to extradition and was subsequently surrendered to U.S. authorities. The charges against Zhang now are set forth in an Information filed by the government.

Zhang appeared yesterday before U.S. Magistrate Judge Alex Tse in the Northern District of California. Magistrate Judge Tse released Zhang on a bond pending further proceedings.

According to the documents filed in Zhang’s case, the defendant and the U.S. Attorney’s Office have entered a deferred prosecution agreement. Under that agreement filed today, Zhang admitted to the conduct that forms the basis of the charge in the Information, and, if Zhang abides by the terms of the deferred prosecution agreement, the charge will be dismissed in three years.

According to filed documents, Z&L Properties also will plead guilty to charges set out in the Information filed against it; Z&L also will agree to a comprehensive compliance and remediation program designed to prevent bribery and corruption in connection with Z&L Properties’ real estate development work. Z&L Properties has agreed to plead guilty to one count of conspiracy to commit honest services wire fraud and one count of honest services wire fraud, will pay a fine of $1,000,000, and will enter into a corporate compliance program acceptable to the Office of the U.S. Attorney. Z&L Properties appeared before U.S. Magistrate Judge Alex Tse today, and the court set a further hearing before U.S. District Judge William H. Orrick, on August 10, 2023, at 1:30 p.m.

The charges against Zhang and Z&L Properties arose from an investigation into bribery and public corruption in San Francisco city government led by the U.S. Attorney’s Office, the FBI, and IRS-CI. To date, more than 14 individuals and entities have been charged in connection that larger set of investigations, including Mohammed Nuru, former director of the San Francisco Public Works department; Harlan Kelly, the former general manager of the San Francisco Public Utilities Commission; and multiple city contractors and other facilitators of bribes and corruption.

Nuru was charged in January 2020, pleaded guilty in January 2022, and on August 25, 2022, Nuru was sentenced to 84 months in federal prison. A separate defendant charged in the investigation, Walter Wong, was charged in June 2020 with conspiracy to defraud the public of its right to honest services and with conspiracy to engage in money laundering, both involving Nuru. Wong entered a guilty plea and agreed to cooperate with the government’s San Francisco City Hall corruption investigation.

An Information merely alleges that crimes have been committed, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt. If convicted, the defendant Zhang faces a maximum sentence of 20 years imprisonment, a maximum fine of $250,000, plus restitution if appropriate. Z&L Properties faces a maximum fine of $500,000 per count, plus restitution if appropriate. However, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.

The case is being prosecuted by the Corporate and Securities Fraud Section of the U.S. Attorney’s Office for the Northern District of California. Assistant U.S. Attorneys David Ward and Robert Leach are prosecuting the case. The prosecution is the result of an investigation by the FBI and the Internal Revenue Service-Criminal Investigations (IRS-CI). First Assistant U.S. Attorney Patrick Robbins thanked the Department of Justice’s Office of International Affairs and United Kingdom authorities for their assistance in the extradition.

The post Northern District of California | Chinese language Nationwide Actual Property Developer Seems In Court docket To Face Fees Of Bribing A Distinguished San Francisco Public Official appeared first on DAILY SAN FRANCISCO BAY NEWS.

Source: AdobeStock / Consulting

The Federal Reserve Bank of San Francisco, joining the growing ranks of public stakeholders around the world looking to jump on the Central Bank’s digital currency (CBDC) wagon, is seeking an experienced CBDC developer for a job posting titled “ Senior Application Architect – Digital”. Currency”.

The job posting states that those interested in applying for the position at the bank could earn up to $215,400 per year.

“As part of the Federal Reserve’s mission to promote accessible, secure, and efficient systems to facilitate dollar transactions, the Federal Reserve System is seeking a senior technologist to conduct research and development of central bank digital currencies,” the bank said in the ad and added

“Given the important role of the dollar, the Federal Reserve System is seeking to better understand the costs and benefits of potential central bank digital currency (CBDC) technologies and how the system can better understand this burgeoning field.”

The move comes shortly after the San Francisco Fed posted a job posting titled “Senior Application Developer – Digital Currency.” With ongoing efforts to form a CBDC-focused team, more vacancies could be posted soon.

The recent announcement states that the selected candidate will be “part of a team at the forefront of technological research and development in the central bank digital currency space” responsible for designing and implementing systems critical to CBDC research meaning are.

A completed bachelor’s degree with a focus on computer science, business informatics or a comparable technical subject or equivalent training and experience is expected. You must also demonstrate a track record of designing and managing digital payments, crypto and/or CBDCs. In addition to hands-on programming experience, the job posting requires candidates to have knowledge and experience in distributed systems design, cryptographic protocols such as zero-knowledge proofs, and consensus algorithms and security.

“The Senior Application Architect works directly with management, other developers on the team, development operations teams, and vendors to ensure the Federal Reserve is well-positioned to design, develop, and implement technology to support a CBDC as it may Board of Governors is required,” the bank said.

In this position, the selected individual will be tasked with creating and overseeing the architectural design of novel systems, as well as directing the efforts of responsible development teams, including internal and external team members, the job posting states.

It is worth noting for those willing to apply for the position that they must be US citizens or hold a green card with the intention of eventually becoming US citizens.

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The developer and OCM property owner, Kilroy Realty Corporation, has a constellation of high-end commercial and residential properties throughout the Bay Area, Washington, the greater Los Angeles area, San Diego and Texas. While Bay Area representatives didn’t respond to SFGATE’s questions about specific development plans at OCM, its website shows that it is planning on building a 3 million-square-foot office and retail space right where the modest boat community is located. The five-phase, 50-acre project, Kilroy Oyster Point, boasts plans to erect a dozen buildings including an “urban village” with an outdoor meeting space and amphitheater, conference center and “amenity building.”

KPIX says that the corporate developer served notices to longtime OCM residents on June 16, 2022.

“As a part of our planning for the neighborhood, we are currently re-evaluating the long-term use of the marina and intend to terminate all OCM leases on October 15, 2022,” the notice reportedly said. “We will not be providing return rights of any kind to existing tenants of OCM.”

Meanwhile, the “liveaboard” residents—all of whom are reportedly on fixed incomes—must leave by then or face eviction. Even though Kilroy offered a $10,000 relocation payment to those who sign the agreement within two weeks, longtime OCM resident Matt Klein and his neighbor, Lucia Lachmayr, told the outlet that it’s still “devastating” to the community.

“We are going to be left homeless,” Klein told KPIX. “We were given a very, very swift notice after very little warning.”

“It’s a huge, not just an endeavor, but it’s a life change for people who have been here for decades,” Lachmayr told the station. “It’s basically saying, here, go somewhere far, far away, and just uproot your life.”

The city of South San Francisco is reportedly asking Kilroy to accommodate the boat residents by extending their time to leave, if needed. In response, a Kilroy spokesperson issued the following written statement to SFGATE:

“As the Oyster Point development moves forward, we are re-evaluating the long-term use of the marina. As a result, we will be requiring existing boat owners to relocate,” it says.

“We understand the uncertainty that these changes will introduce to our boat owners, which is why we are working with them to make their transition as painless as possible. We are providing all boat owners with four months to prepare for their next move, while offering We will continue to offer our support to these boat owners throughout this process and look forward to working with them collaboratively as we prepare for the next phase of Oyster Point.”

KPIX says that 11 out of 14 residents have accepted the $10,000 and the deadline to accept has been extended to July 31.

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Builder Joey Toboni was swimming in the bay a few years ago when he looked back at Aquatic Park and took in the scene.

Among the walkers and joggers he noticed a class field trip led by a few teachers. There was a home health care aid pushing an elderly woman in a wheelchair and a crew of National Park Service workers doing landscape work. He thought about the wide range of jobs that it takes to make a city function — and the wide gap between what those jobs pay and what it costs to live in the city.

“It dawned on me that none of these folks had a path to stay in San Francisco,” he said.

While that revelation was hardly groundbreaking in one of the world’s most expensive cities, for Toboni it became the seed of an idea he couldn’t shake.

“In that moment I realized there was nothing preventing me from being audacious and trying to tackle that problem,” he said. “I went home that night and started writing a business plan.”

What Toboni, 37, settled on was an idea maybe as challenging as it was simple: to build workforce housing for the middle class without accepting the sort of public subsidies — tax credits and affordable housing bonds — that finance most of the city’s affordable housing. In bypassing the red tape required for public subsidized housing, he figured he could be nimble and streamlined.

Toboni came up with a name — the Affordability Project — and scoured the city for a site on which to launch the concept. He enlisted fellow city native Tim Szarnicki — they played basketball at St. Ignatius College Preparatory — who had spent seven years in various leadership roles at Immaculate Conception Academy, a low-income Catholic school in the Mission District.

On Thursday the Planning Commission voted 6-1 to support the Affordability Project’s debut offering: a 100-unit rental project at 5250 Third St. in the Bayview District.

Tim Szarnicki (left) and Joey Toboni, who played basketball together in high school while growing up in San Francisco, have started a new affordable housing development company that does not take public money.

Lea Suzuki/The Chronicle

On paper the project looks like a typical HOME-SF project — a density bonus program where developers get an extra two floors of heights in exchange for making 30% affordable to a range of low- and middle-income families. What makes the project unusual, however, is that the developer is also committed to restricting an additional 40% of the units to families earning between 80% and 140% of area median income, or $110,000 to $194,000 for a family of four. So the entire project will have 70% deed-restricted units.

The project received some opposition from building trades organizations that have clashed with the Toboni Group, a housing builder founded by Joey Toboni’s father. Toboni, who focuses on building single-family homes in his for-profit business, said that the Affordability Project is entirely separate from other family businesses. He said that he can’t commit to making the 5250 Third St. project an all-union job but that he hopes future developments will be.

In a city where an affordable unit can cost $750,000 to build, Toboni is hoping to build for less than $350,000 a unit. The cost savings come in part from the land as the Affordability Project was able to buy the parcel for $3 million, or $30,000 a door, about a 90% discount from what other land has sold for in San Francisco.

In addition, the group will save time and money by privately financing the development through philanthropy, which Toboni says will be far more efficient than going to the time-consuming and competitive process of competing for tax credits and affordable housing bonds.

“The point of this organization is to get workforce folks into housing now,” said Toboni. “We believe a private organization can be much more efficient than the government is.”

A notice for a past public hearing is seen on a fence on a site on Third Street that Tim Szarnicki and Joey Toboni are hoping to develop into affordable housing.

Lea Suzuki/The Chronicle

The project will be a benefit to Bayview businesses, according to Earl Shaddix, executive director of the Economic Development on Third, who lives in a below-market-rate unit at 4800 Third St. In the past 10 years only 20 units have been added along the heart of the Bayview’s commercial district, he said.

While the neighborhood’s business district is doing better — vacancy rate has dropped from 30% to 10% in the past few years — additional foot traffic is needed to make sure the small businesses survive. New businesses opening recently include Feline Finesse Dance Co., Gratta Wines and U3Fit fitness gym — with several more expected to open in the coming months.

“There is a tremendous desire for more foot traffic and more lights on the corridor at nighttime,” Shaddix said. “We desperately need that, and the way we do it is through increased density. We know housing will mean more people on the corridor.”

Toboni said the plan is to build 2,000 workforce housing units in the next 10 years.

“Tim and I both realize that goal is extremely ambitious,” he said. “But if you don’t set a high goal, there is nothing to reach for.”

Affordability Project has raised much of the money and has a commitment from a bank to provide a construction loan, although the group must raise another $6 million before breaking ground. The hope is to be under construction next spring.

Toboni said it’s too early to say what the exact income eligibility will be of the additional 40 affordable units, but that the rents would be set to ensure that essential workers like teachers and police officers qualify. Any profits from the project will be reinvested into the next affordable development.

A rendering of the proposed affordable housing project at 5250 3rd St., which would be built with zero public money.

Lea Suzuki/The Affordability Project

Former Supervisor Katy Tang, who drafted San Francisco’s HOME-SF density bonus legislation, is on the board of the Affordability Project.

As a veteran of the city’s development battles, Tang said she realizes that building housing in San Francisco requires patience, money and political finesse. While the Affordability Project has a tough road, it’s worth trying, Tang said.

“If we don’t try it, it absolutely won’t work,” she said. “The largest group of families leaving the city are middle-income families.”

Tang said she has talked to many Bayview businesses.

“What they keep asking is how can we get more people to visit the small businesses on Third Street? There is not currently a level of foot traffic to sustain local business.”

Toboni said he continues to be motivated by that realization that he had while floating in the bay — that the families he grew up alongside in the Richmond District have no place in the current city.

“My best friend’s parents growing up were an iron worker and a teacher,” he said. “There is a zero percent chance that people working those professions could afford the Richmond today.”

JK Dineen is a San Francisco Chronicle staff writer. Email: jdineen@sfchronicle.com Twitter: @sfjkdineen

The post One inexpensive San Francisco dwelling prices $750,000 to construct. This developer plans to do it for $350K appeared first on DAILY SAN FRANCISCO BAY NEWS.

When developer Brooks Patterson, owner of Prodigy Woodworks, first came across a 120-year-old former ice and coal warehouse in Macon, Ga., he envisioned Lofts at Empire Yard as a modern, multifamily property housing 28 units.

“The neighborhood was in rough shape but had these beautiful buildings needing revitalization after 50 years of neglect,” said Patterson. “We decided to buy all of the property along the street to spaces scattered throughout and give turn into multifamily units with some retail the neighborhood new life.

“I was drawn to the Empire Coal Company building in particular for its bones and history. It was built in 1897 and a lot of the architectural elements from that period have become popular again in industrial loft apartments. These elements include beautiful, large windows, high ceilings and solid structural beams.”

The 124-year-old Empire Coal Company, now the 28-unit lofts at Empire Yard.

HIGH CEILINGS RAISE CONCERNS

Patterson set out to renovate the building’s 65,000 sf of space into loft-style apartments, adding a pool and rooftop patios, while thoughtfully incorporating its historical design elements. But the high ceilings that Patterson knew would be aesthetically appealing to future tenants were concerning when it came to specifying mechanical systems.

“A lot of people remodel older buildings and keep the existing ductwork, but I’m not a fan of that look,” said Patterson. “I chose ductless systems because they can offer performance, quiet operation, and efficiency in a nice, sleek package. I wanted my tenants to enjoy those benefits and the low utility bills that came with them. My next step was finding the right manufacturer.”

Patterson found the solution with Mitsubishi Electric Zoned Comfort Solutions®.

CHOOSING THE RIGHT HVAC SYSTEM

Patterson didn’t have much professional experience with Mitsubishi Electric systems but had recently installed a split-ductless system in his own home and was happy with the performance. What sealed the deal on ductless was the glowing recommendation from mechanical contractor Clay Etheridge, owner of Etheridge Heating and Air, Forsyth, Ga.

“We wanted the best systems for this project, so we went back and revised our budget to put Mitsubishi Electric units in the lofts,” said Patterson. “The upfront mechanical costs may have been higher than I’d initially planned, but Clay’s commitment to standing behind the brand gave me confidence that I’d see a return on my investment quickly. As a matter of fact, my tenants have such low energy bills that the units are already paying for themselves.”

Etheridge and his team recommended a combination of Mitsubishi Electric EZ FIT Recessed Ceiling Cassettes complemented by Designer Series Wall-Mounted Indoor Units.

“The ceiling cassettes were a great choice for the lofts’ ceilings,” said Etheridge. “They fit nicely between the old building’s standard-width ceiling joists so there was no need for additional construction efforts. We also appreciated their sizing because we could place them nearly anywhere, including the corner of a room and just adjust airflow to blow in the most desirable direction. We also found that they hid wiring well, giving us a really clean-looking end result.”

Mitsubishi Electric wall-mounted unit at the Lofts at Empire Yard.

The ceiling cassettes can be serviced from below, automatically simplifying any maintenance requests that might come in.

MAINTENANCE REQUESTS AT A MINIMUM

Regarding maintenance requests, there’ve been minimal requests for service.

“In this sort of adaptive reuse project, where we take a very old building and transform it, a lot of people expect that the mechanical systems won’t be up to snuff,” said Patterson. “Even if we’ve completely gutted the place and started from scratch, they see the old industrial footprint and assume they’ll be dealing with boilers and radiators. It’s been fun to see tenants pleasantly surprised by the Mitsubishi Electric system – how well it performs, how quiet it is, and how easy it is to control.”

Mitsubishi Electric’s kumo cloud wireless control software.

The easy operation is thanks to use of Mitsubishi’s kumo cloud wireless control software (https://www.mitsubishicomfort.com/kumocloud). Zoned Comfort Solutions systems can use kumo cloud to give tenants user-friendly control over their apartments’ temperature through a wall-mounted tablet or remote app. All units can be controlled as a group for universal mode operation, or independently for temperature settings. Tenants benefit from even, comfortable temperatures and reliable conditioning.

“We’ve received great feedback on how quickly the units heat the building in the winter and cool it on warm days,” said Etheridge. “The tenants and building management have expressed they are happy with performance and speed.”

Tenants also realize lower utility bills. Patterson can track the efficiency of the systems by monitoring each apartment’s energy bills.

“Sometimes the bills are as low as $45 per month in the winter,” said Patterson. “Georgia isn’t the coldest place in the world, but we see temperatures in the high 20s and low 30s that definitely make tenants want to have their heat running.”

COMFORT INSIDE AND OUT

For Patterson, the right HVAC solution would be low impact for his tenants from an aesthetic, maintenance and operational sound level standpoint. He wanted to make sure that his confidence in the indoor comfort levels also translated to outdoor amenities for his tenants.

The apartments have access to private rooftop cupolas and walkout patios. While this feature has appeal to prospective tenants, Patterson was initially concerned about noise levels from the system’s outdoor units installed there. Those concerns were quickly squashed. With the units’ whisper quiet operation, they are barely audible at 58 dB(A).

The Empire Coal Company building (1897) had “good bones” and an interesting history, said its developer, Brooks Patterson.

LOFTS AT EMPIRE YARD

PROJECT TEAM Prodigy Woodworks, Macon, Ga. (builder), Etheridge Heating & Air Conditioning, Forsyth, Ga. (mechanical contractor).

MITSUBISHI ELECTRIC EQUIPMENT USED

Loft phase 1

• (12) M-Series Heat Pump Outdoor Units (12) M-Series Heat Pump Outdoor Units
• (3) SUZ Universal Heat Pump Outdoor Units
• (30) EZ FIT Recessed Ceiling Cassette Units
• (5) SLZ-KF Four-Way Recessed Ceiling Cassette Units

Loft phase 2

• (8) M-Series Heat Pump Outdoor Units
• (1) SUZ Universal Heat Pump Outdoor Unit
• (20) MSZ Wall Mounted Indoor Units
• (2) EZ FIT Recessed Ceiling Cassette Units
• (3) SLZ-KF Four-Way Recessed Ceiling Cassette Units
• kumo cloud app and web service

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MILLBRAE (KPIX) – Millbrae, a peninsula town that failed to meet its residential goals in the past, is now being sued for it.

“Bringing a housing project together has become incredibly difficult in the last 10-15 years. And I don’t expect it to be any easier, ”says Andy Davidson, Managing Partner of Anton Development.

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Davidson and Anton’s team are trying to redesign the historic El Rancho Inn near the San Francisco Airport.

The bureaucratic back and forth between Anton and the city lasted four years and neither side has anything to show. Now Anton is suing the city of Millbrae.

“We’re really looking for a referee; Someone to call the piece what it is and we’ll be on our way, ”Davidson said.

It all started in 2017. Anton intended to build 220 units at market prices and 50 units of affordable living space as well as a hotel on site. But then the hotel partnership failed.

Anton says that is because the city has progressed too slowly with the approval process.

“So if it takes too long to apply, you will lose all engagement with the hotel brand you are working with,” explains Davidson.

In the midst of it all, the state passed SB 330, also known as the Housing Accountability Act. The law was designed to streamline the trend in which cities are stepping back against affordable housing.

Since the project includes an affordable housing component, Anton invoked the new law and said it would allow them to bypass the rezoning process and save a lot of money.

“The developer wants to try to pull a quick one,” said Sam Singer, a spokesman for the city of Millbrae.

Singer means that the developer is using the new law as a loophole to avoid paying the $ 18 million development fee.

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The presence of the singer is intended to signal how serious the argument has become. He is nicknamed “Master of Disaster”; a public relations professional who says this case doesn’t stand up in court.

“You can’t expect taxpayers to subsidize a very wealthy and successful developer,” Singer said.

Singer says when the hotel contract failed and Anton came up with new plans, it became a different project with higher fees.

“I hate it when tax dollars are wasted on such a lawsuit,” said Davidson.

“It pisses me off,” said Jodie, a woman who lives in Millbrae.

She stopped by the hotel while KPIX was interviewing Davidson to complain about developments.

“Rich people argue about[expletive[thatwewishwecouldgettheirhandsonthem”saidJodie[expletive[thatwecouldgetaholdof”Jodiesaid[Kraftausdruck[vondemwirunswünschenwirkönntenihnindieHändebekommen“sagteJodie[expletive[thatwewishwecouldgetaholdof”Jodiesaid

Jodie has been on an affordable housing waiting list for several years, she came over to yell at the developer because only 5% of the project is affordable, she says it doesn’t make a dent.

In their words? These “rich people need to stop fighting and build a place for them to live”.

“They say they have programs, but there are thousands on the waiting list. Home is hard to get when you are not on a wealthy site. Poverty is real, ”said Jodie.

The state weighed in and threw its support behind Anton. Singer says Millbrae supports the project, but Anton has to stick to the rules.

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Both parties say they want to see this apartment built but right now they are going to court instead of breaking the ground.

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