Sixty-three condos of affordable housing for teachers, slated to break ground this year at an abandoned building at 18th and Mission streets, have been delayed due to insufficient funding. How long they will be delayed is anyone’s guess.
The delay was confirmed by the Mayor’s Office of Housing and Community Development and District 9 Supervisor Hilary Ronen’s office. The Mission Economic Development Agency, the nonprofit developer of 2205 Mission St., declined to comment.
“We are very disappointed,” said Ana Herrera, Ronen’s legislative aide. “Because we had expected by the end of this year the project would break ground.”
The nonprofit, known by its acronym MEDA, secured $12 million from Proposition I last July to reconstruct the existing two-story building and build a new one, which has, for years, sat vacant and become an eyesore in the heart of the Mission. MEDA was hoping to get the remaining funding through the New Market Tax Credits program, a federal financing tool for affordable housing, but its application was denied, according to Anne Stanley, the communications manager for the housing office. It remains unclear why.
Until the nonprofit finds an alternative funding source, the dozens of homes at 18th and Mission streets will have to sit in the pipeline.
Announced last July by the mayor’s housing office, the project is one of two affordable-housing projects for educators in the city. The other, at 750 Golden Gate Ave., will convert a parking lot into 72 rental units of 100 percent affordable housing.
The 2205 Mission St. project will be condominiums for purchase. Herrera said condos are more challenging to finance because interest rates are currently high.
Both projects are for those earning between 40 to 140 percent of area median income, which translates to between $41,950 and $146,850 for individuals and between $59,950 and $209,800 for a family of four. All the homes in both projects will be offered first to teachers and staff of the San Francisco Unified School District and the Community College District, and their families.
Herrera said there is still hope for the project. She said that Ronen and her office are looking at other alternatives, including making the units rentals instead of condos.
Herrera also mentioned the possibility of the Regional Bay Area Housing Finance Authority (BAHFA) bond. The bond is likely headed for the November ballot and, if passed, would unlock as much as $20 billion. The money would be used for affordable housing units in the Bay Area that are in the pipeline, but awaiting financing. The 63 units in this project are among the 8,448 homes San Francisco has in the pipeline waiting for financing.
“MOHCD [the mayor’s office of housing] is working with MEDA to find a path forward, including identifying alternate funding sources,” added Stanley.
While it’s true that vital housing here would have enriched over 100 lives it’s important acknowledge that this important historical building, although vacant and decaying the last 20 years, has served to be even more vital and rewarding for the neigbor. Not only has it served as history but also a necessary public place to urinate and sell used goods in front of. Kudos to the planning department and Hillary Ronen for keeping our city’s priorities straight:
Juan, please explain how Hilary Ronen is responsible for the funding issue. I’d love to hear this. Same as I’d love to hear how you think the Planning Department had anything to do with it either.
Ask Ronen about 1515 S Van Ness. It could have been housing with 25% affordable a decade ago before Campos blocked it. She promised housing there for years and years and still nothing.
Twelve-million dollars and nothing to show for it? Why the Hell do we as San Franciscans tolerate this crap from these nonprofits?
Also, it should have been rentals all along.
The 12 million dollars wasn’t likely disbursed to MEDA, it’s was probably awarded, awaiting for the entire project to be entitled and financed for any funds to be disbursed. What crap are you referring to?
Come on, _how_ long has this building been vacant now? I know there are plenty of challenges in finding funding, but these orgs can’t be given standing in hearings to block other housing projects all over SF if they can’t follow through on their stated intentions to build alternative housing.
MEDA is blocking housing projects all over SF?
Just build some market-rate rental housing and get it over with.
How much Prop C affordable housing $$$ is Breed sitting on? This is a case of manufactured politically expedient scarcity.
Anyone who thinks that this Rube Goldberg machine of affordable housing finance can scale to meet the challenge after 25 years of fits and starts is smoking crack. Do people still smoke crack?
Tax exempt mortgage revenue bonds largely paid down with rental revenues with a city subsidy to make up the gap, where the city is paying itself by investing in permanently affordable housing, can scale to the task.
It is time to cut bait on the byzantine funding model and start fishing with revenue bonds.
Cut bait on the byzantine funding model and go with tax exempt bonds? Of all of the affordable housing financing instruments out there, tax exempt bonds are one of the most byzantine Rueb-Goldbergesque of them all, especially when the City of San Francisco is acting as the bond issuer. Most affordable housing projects don’t actually need tax exempt bonds to pencil out. But the IRS says that 50% of your project’s aggregate basis needs to be financed by them if you want 4% Low Income Housing Tax Credits. And pretty much any affordable housing project built in San Francisco these days isn’t moving forward if it doesn’t have tax credits.
I walk past this corner all the time. It’s a shame it’s going to stay derelict longer, especially now that neighboring Gracias Madre closed, leaving a bigger blank.
This could have been funded and under construction years ago if Mayor Breed hadn’t blocked the use of 2020 Prop I funds for affordable housing—the purpose that was promised to voters. It’s good that Breed finally relented last year and allowed a fraction of Prop I revenue to go to developments like this, but now we’re in a much worse state/federal environment for raising matching funds. Delaying housing really hurts.
For readers unfamiliar with the fights over Prop I money, the linked previous coverage by Annika Hom gives a good overview: https://missionlocal.org/2022/02/nonprofit-wants-12-million-in-city-funds-to-build-teacher-housing/
“MEDA was hoping to get the remaining funding through the New Market Tax Credits program, a federal financing tool for affordable housing, but its application was denied”. It would be interesting to find out why this didn’t go through.
Also, on second thought, what is the Plan B if there’s any?
Affordable condo projects that are stand alone (e.g. not part of an inclusionary deal) are notoriously difficult to finance. You could say the same thing about affordable teacher housing, and middle income affordable housing (e.g. projects targeted above 60%-80% AMI). This project sat in the middle of a vein diagram with all three of these traits, so it shouldn’t exactly come as a surprise that this it’s is stalling out . There are other affordable housing developers in the City that have the resources and technical expertise to pull of a project like this. But they would know better than to try it in the first place.
Does MEDA own the property? If so, outright, or with a loan? How are they servicing that loan with nothing coming in on the property? Seems like someone must be losing money here. Is it MEDA, is it some lender, some charitable organization that gives to MEDA, or is it the citizens of SF, who subsidize MEDA? I worry it’s the latter.
Why should teachers have priority? That is ignorant. Everyone needs help, and certainly not someone making more than $100,000 per year!!! Wake up people and get real. Do what everyone else does. Live outside of SF and take wonderful BART and Muni in. There are two stations within blocks of those locations. Stop being lazy!!!!~
Hilarious! You think you can somehow force teachers continue working in SF after they’ve been priced out of the city? Many Bay Area districts offer higher salaries AND lower housing costs. This is why SFUSD currently has a hiring problem.
By the way: Many of us DON’T want to live in company housing. After school hours we want to leave our work behind, just like everyone else. We just want enough income to cover decent housing.
Agree. I love teachers, but they are making good salaries compared to many people. And this prioritizes SFUSD “staff” too who have even better salaries.
“Good salaries compared to many people”. That’s not the bar. Somebody who has the ability to tame a classroom while reaching kids so they actually learn the curriculum can easily get work elsewhere that pays double of what they make in SFUSD. I agree however it’s stupid to build teachers’ housing – SFUSD needs to pay teachers proper.