SF supervisor accuses mayor’s office of obstructing housing project

A nonprofit developer was poised to buy a blighted car wash to build affordable housing in San Francisco’s Lower Haight, but the deal fizzled because the city didn’t find funds to pay for it.

That was the accusation by Supervisor Dean Preston, who accused Mayor London Breed’s office of jeopardizing affordable housing to replace the shuttered Divisadero Touchless Car Wash at 400 Divisadero Street, the San Francisco Chronicle reported.

Preston said the city has dragged its feet on acquiring the graffitied property for seven months, despite promises by the Mayor’s Office of Housing and Community Development that a “notice of funds availability” would be issued.

The developer,Tenderloin Neighborhood Development, was in contract to buy the 1-acre car wash from owners Roy and Patricia Shimek, but the agreement expired because there was no guarantee money would be available.

“This kind of obstruction of affordable housing is ridiculous,” Preston told the Chronicle. “We came to an agreement last year, but because the mayor has decided to stand in the way of getting the funds out the door, we’re missing golden opportunities for more affordable housing development.”

In June, Preston worked with Supervisor Hillary Ronen and Breed’s office on an agreement to allocate $112 million in the budget to boost affordable housing development, including $40 million for site purchases and $12 million for teacher housing.

Preston said the language in the agreement was written specifically with the closed car wash in mind.

The property was approved for a 186-unit apartment and retail building in 2019, estimated to cost $50 million. The city’s first automated car wash, which opened in 1958, was to be demolished.

But after a seven-year attempt by Genesis Living to build the six-story complex – with 20 percent of the proposed apartments set aside as affordable – the Texas-based developer abandoned the project last October after determining it wouldn’t pencil out. Around the same time, the Shimeks sold their Stinson Beach home for $12 million.

Since then, Preston, who was opposed to the development, has been pushing the city to buy the property for affordable homes.

A spokesman for the mayor said city rules don’t allow it to fund a specific property acquisition for a developer without a competitive bidding process.

“We have to be transparent, we can’t predetermine that any particular nonprofit or any particular lot will be selected,” Jeff Cretan, a Breed spokesman, told the newspaper. “We do not want to corrupt the process by showing any favorites. There are numerous entitled projects across the city that could be eligible for this funding.”

The fight comes when the Board of Supervisors is expected to pass a state-mandated plan to build 82,000 homes during the next eight years, 46,000 of which must be affordable to low- and moderate-income households. The deadline for the housing element plan is Jan. 31.

It also coincides with a state probe into San Francisco’s glacial housing approvals, the slowest in the state. Early last year, the city’s building applications plummeted to a six-year low, with developers saying the city must address its fees and affordable housing requirements for projects to become economically feasible.

— Dana Bartholomew

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