Nonprofit Developer Wins Final Appeal for SF Homes

Tenderloin Neighborhood Development has fended off an appeal by residents trying to block its 90-unit affordable housing project in San Francisco’s Sunset District.

The San Francisco-based nonprofit had waged a two-year battle over its approved apartment complex at 2550 Irving Street, the San Francisco Chronicle reported. It will replace a former police credit union building.

A decision by a Board of Appeals to reject the appeal from the Mid-Sunset Neighborhood Association clears the way for the seven-story development. Construction could start in May.

Anne Stanley, a spokeswoman for the Mayor’s Office of Housing and Community Development, said a lawsuit to block the project and appeals by the neighborhood association added $1 million to the $102 million cost of the project.

The affordable homes are now projected to cost $1.14 million per unit.

The all-affordable housing project was given a green light in December 2021, after a judge ruled against the neighbors’ request for a temporary injunction to halt the development.

The Mid-Sunset neighbors group appealed the decision, arguing the city should revoke the project’s construction permit. It claimed toxic substances near the site hadn’t been adequately tested and cleaned up. It also said the nonprofit developer failed to engage the community and address concern over its size and scale.

It also lost an appeal of the demolition of the San Francisco Police Credit Union building, which was razed in June.

Mayor London Breed had blasted the years of delays.

“This obstructionism is unacceptable,” Breed had said on Twitter. “This project must move forward and we need to reform our laws so we can build the homes we badly need.”

The project would have had even longer delays and costs had it not been for SB 35, a state law that fast-tracks the approval of affordable homes.

At the appeal hearing, Deputy City Attorney John Givner said the city had limited authority to deny the building permit because the project had lived up to the law. Others at the hearing said toxic chemicals left over from long-gone dry cleaners would be remediated.

The Board of Appeals vote comes as Assemblyman Matt Haney sponsors a proposed law to prevent the appeals of already approved building permits.

“This process adds delays, costs and hurdles that have made San Francisco one of the most costly and time-consuming places to build in the state,” Haney said in a statement. “It’s also the reason why only 26 affordable units have been built in the Sunset in the past decade.”

In February last year, the state Department of Housing & Community Development awarded a $36 million grant to help fund the 90-unit affordable complex on Irving Street.

— Dana Bartholomew