South San Francisco, CA December 11, 2015 by Austin Walsh San Mateo Daily Journal
New housing approved in South San Francisco: Officials praise affordable element, but question the projects financing
December 11, 2015, 05:00 AM By Austin Walsh Daily Journal
|Two large apartment buildings with a portion set aside for affordable units in downtown South San Francisco received the green light for construction from city officials this week.
The South San Francisco City Council unanimously approved Wednesday, Dec. 9, building two projects which will combine to add 80 new apartments, 17 of which will be affordable, at 488 Linden Ave. and 255 Cypress Ave.
Though city officials commended the vision of the projects, both of which are being developed by Brookwood Equity, some councilmembers expressed concerns regarding the construction financing.
Brookwood Equities needs to provide proof of a partnership with a private investment firm willing to commit the roughly $11.5 million required up front for financing in the next 45 days, or city officials reserve the right to halt development.
The developer will also need about $30 million in loans to complete construction of the projects, and must show commitment of those necessary funds in one year, or the city could kill the project as well.
Though the developer has yet to lock down financing commitments, Brookwood Equities CEO Shepherd Heery expressed confidence the council’s approval would pave the way for getting the necessary funding.
“We are concerned about moving this process forward as quickly as we can,” said Heery.
Brookwood Equities is an investment and development subsidiary of the Brookwood Group, which specializes in construction through garnering public and private partnerships.
City officials also drafted an agreement which sets milestones for progress, such as when the projects will break ground, and the building could be called off should the developer not be able to deliver.
Alex Greenwood, the economic development director of South San Francisco, called the progress points “tools in our tool kit which would compel [Brookwood Equities] to finish.”
The city owns the Linden property, and the Grand site was purchased with redevelopment funds, and officials have committed to contributing roughly $2.1 million in grant funding toward the project’s development, due in part to the affordable housing component.
The county’s Housing Endowment and Regional Trust has offered $1.2 million for construction of the affordable units as well.
Vice Mayor Pradeep Gupta said he believes the project is a prime example of the potential power of collaboration which could address a tremendous need in the community for affordable housing.
Of the 17 total affordable units split between the two projects, 14 will be available for those who earn 80 percent of the area median income, which for a household of two equates to about $75,000 per year. The other three will be set aside for a household of two which earns about $99,000 annually.
The Cypress project, located only blocks away from the Linden site, will be five stories, with 46 units spread across the top four floors sitting over a ground floor of retail.
Plans include space for 21 one-bedroom apartments, 22 two-bedroom units and three studios, and 9 units of the building will be set aside at an affordable rate.
The Linden building will also rise five stories high, with the top four floors comprised of 37 units, with four studios, 18 one-bedroom units, 11 two-bedroom spaces and five three-bedroom apartments. Eight of the units will be set aside at an affordable rate.
The ground floor of the Linden project will be reserved primarily for parking and resident amenities, such as a lobby, fitness room and lounge.
Officials have expressed a desire to add more dense and affordable housing to South San Francisco’s downtown over the coming years, and Greenwood said he believed the Brookwood projects represent a significant step toward realizing that vision.
“This will serve as a catalyst for other development going forward,” said Greenwood.
Gupta noted the difficulties which could be presented through the need to attain commitments for financing, as well as hitting the development milestones laid out in the agreement, but expressed his support for the intricate maneuvers required to pull the project together.
“This is a poster child project for the cooperation between public and private entities,” he said. “It’s very complex, but an indicator for other projects that might come about. I like the concept and the way you have tried to execute it.”
Heery agreed with many of Gupta’s sentiments, and said Brookwood Entities is prepared to see the project through.
“We are committed to working collaboratively to the end,” Heery said.
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