This week’s update reports on three recent planning policy measures of import to the San Francisco real estate community. Stimulus Program Last week, the Planning Commission adopted a “Stimulus Policy for Recession Recovery & Project Implementation.”  This measure gives sponsors of approved projects that have exceeded their performance commencement deadlines a one-time opportunity to submit Building or Site Permit Applications immediately, without going through the typical lengthy Planning Commission extension process.  The Stimulus Program does not change existing policy subjecting the new Building or Site Applications to current fee amounts and other current Code requirements. Eligible projects are those with construction costs over $500,000 and approvals no more than 10 years old.  The Planning Department is mailing notice of the Program to approximately 65 identified eligible project sponsors.  The project sponsor will have 60 days to “opt in” to the Program.  Planning also has produced a list of the eligible projects.  Please contact our office if you would like to know if your project is on the list.  Further details on the Stimulus Program are provided below. Office Allocation The Planning Department recently announced that it has added 800,000 square feet to the City’s Large Project Office Development Allocation pool.  This additional square footage previously had been incorrectly deducted from the pool.  This is welcome news as many in the development community are concerned about the availability of allocations due to the recent abundance of office development applications. CEQA Reform The Board of Supervisors’ Land Use and Economic Development Committee considered Supervisor Wiener’s CEQA reform legislation (see our March 29, 2013 Update) at its April 8, 2013 hearing.  It was an overflow hearing room, with both supporters and opposition present and vocal.  Over 50 speakers addressed the Committee.  In the end, the Committee voted to continue the matter until April 22.  Supervisor Kim introduced her alternative CEQA legislation this week, and the Committee intends the use the continuance period working to reconcile the two measures. Further Stimulus Program Details (and Performance Condition Clarification) In order to be eligible for the Stimulus Program, the development project must meet the following specific requirements: Has a Conditional Use Authorization, a Downtown Project Authorization, or an Eastern Neighborhoods Large Project Authorization approved by the Planning Commission between April 4, 2003 and October 4, 2011; Has a condition of approval with a performance time frame that has expired; Is not subject to specific Planning Code provisions that limit the time frame for project implementation (e.g., § 321(d) for large office projects); Has an estimated construction cost of no less than $500,000; and Does not involve any Wireless Telecommunications Facility. A submitted Building or Site Permit Application (the “Application”) will be approved only if it meets the following specific requirements: The Application complies with all other conditions of approval and is consistent with the project’s granted approval(s); The Application complies with all Planning Code provisions currently in effect, including but not limited to use limitations, building form controls and development impact fees; and The Application is approved by the Planning Department and issued by DBI no later than October 4, 2014.  This 18-month period may be extended at the discretion of the Zoning Administrator only where implementation of the project is delayed by an appeal or by a legal challenge, and only by the length of time for which such an appeal or challenge had caused delay. In a related action, the Planning Commission formalized its existing policy concerning the performance time frames imposed on future Conditional Use Authorizations, Downtown Project Authorizations, and Eastern Neighborhoods Large Project Authorizations.  The performance time conditions for these Authorizations will provide that a Building or Site Permit must be issued within three years from the date of approval. The conditions of approval also will provide that if the three-year period lapses without issuance of a Building or Site Permit, the project must seek renewal of the Authorization through an amendment of the original Authorization or an application for a new Authorization.  If the project sponsor does not file for such a renewal, the Planning Commission must conduct a public hearing in order to consider revocation of the Authorization.   The issues discussed in this update are not intended to be legal advice and no attorney-client relationship is established with the recipient. Readers should consult with legal counsel before relying on any of the information contained herein. Reuben, Junius & Rose, LLP is a full service real estate law firm.  We specialize in land use, development and entitlement law.  We also provide a wide range of transactional services, including leasing, acquisitions and sales, formation of limited liability companies and other entities, lending/workout assistance, subdivision and condominium work. ​

This week’s update reports on three recent planning policy measures of import to the San Francisco real estate community. Stimulus Program Last week, the Planning Commission adopted a “Stimulus Policy for Recession Recovery & Project Implementation.”  This measure gives sponsors of approved projects that have exceeded their performance commencement deadlines a one-time opportunity to submit Building or Site Permit Applications immediately, without going through the typical lengthy Planning Commission extension process.  The Stimulus Program does not change existing policy subjecting the new Building or Site Applications to current fee amounts and other current Code requirements. Eligible projects are those with construction costs over $500,000 and approvals no more than 10 years old.  The Planning Department is mailing notice of the Program to approximately 65 identified eligible project sponsors.  The project sponsor will have 60 days to “opt in” to the Program.  Planning also has produced a list of the eligible projects.  Please contact our office if you would like to know if your project is on the list.  Further details on the Stimulus Program are provided below. Office Allocation The Planning Department recently announced that it has added 800,000 square feet to the City’s Large Project Office Development Allocation pool.  This additional square footage previously had been incorrectly deducted from the pool.  This is welcome news as many in the development community are concerned about the availability of allocations due to the recent abundance of office development applications. CEQA Reform The Board of Supervisors’ Land Use and Economic Development Committee considered Supervisor Wiener’s CEQA reform legislation (see our March 29, 2013 Update) at its April 8, 2013 hearing.  It was an overflow hearing room, with both supporters and opposition present and vocal.  Over 50 speakers addressed the Committee.  In the end, the Committee voted to continue the matter until April 22.  Supervisor Kim introduced her alternative CEQA legislation this week, and the Committee intends the use the continuance period working to reconcile the two measures. Further Stimulus Program Details (and Performance Condition Clarification)    In order to be eligible for the Stimulus Program, the development project must meet the following specific requirements:      Has a Conditional Use Authorization, a Downtown Project Authorization, or an Eastern Neighborhoods Large Project Authorization approved by the Planning Commission between April 4, 2003 and October 4, 2011;      Has a condition of approval with a performance time frame that has expired;      Is not subject to specific Planning Code provisions that limit the time frame for project implementation (e.g., § 321(d) for large office projects);      Has an estimated construction cost of no less than $500,000; and      Does not involve any Wireless Telecommunications Facility. A submitted Building or Site Permit Application (the “Application”) will be approved only if it meets the following specific requirements:      The Application complies with all other conditions of approval and is consistent with the project’s granted approval(s);      The Application complies with all Planning Code provisions currently in effect, including but not limited to use limitations, building form controls and development impact fees; and      The Application is approved by the Planning Department and issued by DBI no later than October 4, 2014.  This 18-month period may be extended at the discretion of the Zoning Administrator only where implementation of the project is delayed by an appeal or by a legal challenge, and only by the length of time for which such an appeal or challenge had caused delay. In a related action, the Planning Commission formalized its existing policy concerning the performance time frames imposed on future Conditional Use Authorizations, Downtown Project Authorizations, and Eastern Neighborhoods Large Project Authorizations.  The performance time conditions for these Authorizations will provide that a Building or Site Permit must be issued within three years from the date of approval. The conditions of approval also will provide that if the three-year period lapses without issuance of a Building or Site Permit, the project must seek renewal of the Authorization through an amendment of the original Authorization or an application for a new Authorization.  If the project sponsor does not file for such a renewal, the Planning Commission must conduct a public hearing in order to consider revocation of the Authorization.   The issues discussed in this update are not intended to be legal advice and no attorney-client relationship is established with the recipient. Readers should consult with legal counsel before relying on any of the information contained herein. Reuben, Junius & Rose, LLP is a full service real estate law firm.  We specialize in land use, development and entitlement law.  We also provide a wide range of transactional services, including leasing, acquisitions and sales, formation of limited liability companies and other entities, lending/workout assistance, subdivision and condominium work.

​Transferable Development rights or “TDR”, are valuable tool for developers looking to build in downtown San Francisco. Essentially it allows developers to exceed the allowable floor area ratio (“FAR”) for their development site, by purchasing development rights from historic buildings.  Although the TDR concept is fairly simple, there are some very strict rules about which properties are eligible to transfer and receive TDR.  Recently there have been some changes in the Planning Code regarding TDR in Downtown Commercial, or “C-3” districts, and more changes are likely on the horizon, with legislation currently at the Board of Supervisors. How does TDR work in C-3 districts? Currently, TDR can be transferred downtown only between buildings in the Same C-3 district, with some very specific (and slightly complicated) exceptions that apply in a limited number of cases. In most districts there are maximum floor area ratios (“FAR”). Once that maximum is reached, no further development is permitted at the site.  While this system worked well for a while, TDR is running out, but the need for it is increasing, as development in downtown is booming after the recession.  With an eye toward intensifying development in downtown San Francisco, several changes are being made to these policies. Recent changes to TDR Rules With a focus on making San Francisco the major business and transportation hub of the West, there have been some changes to allow denser commercial development around the Transbay Terminal.  The Downtown Office Special Development (“C-3-O (SD)”) district which is located south of Market Street, and centers around Transbay Terminal, has no maximum allowable FAR. Instead, in the C-3-O (SD) district, TDR must be purchased to exceed the base FAR  of 6.0 to 1, up to a ratio of 9.0 to 1. Developers are not permitted to use TDR above the FAR of 9.0 to 1, and instead may increase FAR without restriction through participation in the Transit Center District Mello-Roos Community Facilities District, which requires fees to be paid based on square footage of the building. This allows very dense development around the Transbay Terminal without the struggle of searching for significant amounts of TDR to meet development needs. Future changes In the Works This week, the Board of Supervisors Land Use and Economic Development Committee, recommended legislation that would relax TDR policies in C-3 districts. The proposed ordinance would allow TDR to be transferred freely throughout C-3 districts, instead of only allowing transfers between buildings in the same exact C-3 district.  This ordinance would also permit TDR to be transferred into C-3 districts from the South of Market Extended Preservation District, and would eliminate all of the complicated exceptions found in the existing law.  If passed this ordinance would allow TDR to be easily transferred to the parts of downtown where it is most needed, making development of large commercial buildings just a little bit easier.  The Board of Supervisors should be voting on this ordinance sometime in April or May of 2013. The issues discussed in this update are not intended to be legal advice and no attorney-client relationship is established with the recipient. Readers should consult with legal counsel before relying on any of the information contained herein. Reuben, Junius & Rose, LLP is a full service real estate law firm.  We specialize in land use, development and entitlement law.  We also provide a wide range of transactional services, including leasing, acquisitions and sales, formation of limited liability companies and other entities, lending/workout assistance, subdivision and condominium work.

​CEQA Reform       Stop me if you’ve heard this one before.  Well-intentioned legislator seeks approval of a modest, narrowly-tailored, much-needed repair of the CEQA process, only to walk into a firestorm of opposition determined to defeat the measure.  Welcome to the latest episode of CEQA reform.  Last fall, Supervisor Wiener introduced a reasonable measure that would bring some certainty to the CEQA appeal process in San Francisco.  The problem addressed by Supervisor Wiener’s legislation concerns categorical exemptions and negative declarations, the lowest possible level of environmental review under CEQA.  Under existing law, when the City approves a categorical exemption or negative declaration for a project, no time limit exists for when that CEQA approval may be appealed.  Some project opponents have exploited this oversight and have appealed projects at the last moment after months (or years) of work has been devoted to the project.  Supervisor Wiener seeks to correct this glaring problem by introducing time limits within which these CEQA approvals must be appealed.       Not so fast.  Supervisor Kim recently introduced her own “CEQA reform” legislation that not only would thwart Supervisor Wiener’s efforts, but would severely worsen the already broken CEQA regulatory regime in San Francisco.  Among Supervisor Kim’s proposals are the following:   Every project on every building 50 years of older – nearly ¾ of San Francisco’s building stock – would no longer be eligible for a CEQA Categorical Exemption stamp (often issued over the counter in a matter of hours) for a minor change, such as changing a window, replacing a rotted out handrail, or replacing a failing roof. Instead, any and all such projects will be required to get a “Categorical Exemption Certificate”, which is a detailed report that can take 3-6 months to issue and currently costs $5,000, as opposed to $300 hundred dollars for a Categorical Exemption stamp. Similarly, all projects in parks and “open space”, which is a very broad term, would require the same 3-6 month and $5,000 certificate instead of the current Categorical Exemption stamp. Currently, a CEQA document for a single project can be appealed only once, even if the CEQA document covers numerous permits associated with the same project.  Under Supervisor Kim’s proposed legislation, the CEQA document could be appealed each time a discretionary permit is issued for a project. So, for example, if a home remodel required 3 building permits, a street tree permit, and a curb cut permit – all covered by the same CEQA document – the CEQA document could be appealed five different times, triggering 5 separate appeal hearings at the Board of Supervisors for that single project.       Supervisor Wiener’s legislation is scheduled to be considered at the April 8 meeting of the Board of Supervisors’ Land Use and Economic Development Committee.  We urge anyone interested in real CEQA reform to attend the meeting and show their support. Mandatory Soft-Story Building Seismic Retrofit Program What had been a matter of discussion for the last two years is now close to being a legislative reality.  This week, the Land Use and Economic Development Committee approved legislation creating a mandatory soft-story (i.e., wood-frame) building seismic retrofit program.  In particular, the program would require owners of wood-frame structures built before 1978, and possessing at least three floors and five apartments, to prove with an engineer’s inspection that they are not soft-story hazards.  The owner of a building subject to the mandatory retrofit program must engage an architect or engineer to prepare and submit to the Department of Building Inspection a screening form and optional evaluation form within one year from the operative date of the legislation.  For those buildings needing a retrofit, the city would require the retrofit to meet certain engineering standards. Buildings subject to the seismic retrofitting program are organized into four compliance tiers intended to address the most dangerous situations first, and all retrofitting work under the program must be completed within seven years from the legislation’s operative date.  The legislation is scheduled for a first reading at the Board of Supervisors on April 2. Elected Office Wheel Keeps On Turnin’ Because of previous Assessor-Recorder Phil Ting’s November 2012 election to the State Assembly, two newly appointed officials recently assumed their respective duties in elected office.  Mayor Lee appointed Supervisor Carmen Chu (4th District) to replace Phil Ting as Assessor-Recorder, and then appointed Supervisor Chu’s legislative aide, Katy Tang, to replace Supervisor Chu at the Board.  Both Assessor-Recorder Chu and Supervisor Tang will be up for election this November.    The issues discussed in this update are not intended to be legal advice and no attorney-client relationship is established with the recipient. Readers should consult with legal counsel before relying on any of the information contained herein. Reuben, Junius & Rose, LLP is a full service real estate law firm.  We specialize in land use, development and entitlement law.  We also provide a wide range of transactional services, including leasing, acquisitions and sales, formation of limited liability companies and other entities, lending/workout assistance, subdivision and condominium work.

    In the last several years multiple lawsuits have been filed against property owners alleging technical violations of the American with Disabilities Act and other access and disability related laws.  There has been concern that these laws have been exploited by a few plaintiffs at the expense of businesses who are substantially complying with their intent.  As a result, the California state legislature adopted a bill entitled S.B. No. 1086, which was filed with the Secretary of State on September 19, 2012 (“Bill”), to address access litigation reforms.  The Bill is intended to encourage and facilitate access compliance by building owners and businesses, as well as to amend certain litigation requirements to discourage meritless lawsuits.  Certain modifications addressed in the Bill include requiring additional procedural requirements for a plaintiff to file an access related lawsuit and developing educational material for businesses with respect to accessibility compliance.  Although there are a multitude of reforms set forth in the Bill, one change specifically affects commercial landlords entering into new leases.  Section 1938 of the California Civil Code, enacted as a result of the Bill, provides that any lease or rental agreement executed after July 1, 2013 by a commercial property owner shall state whether the property being leased has undergone an inspection by a Certified Access Specialist (“CASp”), and if so, whether the property has met all applicable construction-related accessibility standards. The CASp Inspection     The CASp inspection procedure was in effect prior to the passage of the Bill and is set forth in California Civil Code Section 55.53.  That statute provides that if a property owner so elects, a building inspector who is a certified access specialist shall inspect the property and determine whether it meets current accessibility standards.  If the property does not meet such standards, the CASp inspector shall detail specific changes the owner would need to make and the timeframe in which to do so, in order to comply.  If and when the CASp inspector has deemed that the property meets all accessibility standards, the building owner is issued a numbered disability access inspection certificate, which is then recorded in a book held by the CASp.  The certificate may also be posted at the affected property.  In order to obtain an inspection by a CASp member, a building owner would need to request a consultation with the local agency that would then provide the CASp certified inspector and charge a reasonable hourly rate to do so.  Although an inspection by CASp is not required, a defendant in a disability or access lawsuit may be entitled to a court stay of the claim (an order temporarily stopping any lawsuit) and an early evaluation conference if their property has received the certificate.  Essentially, an approval by CASp is evidence to the court that the building owner has most likely complied as necessary with the accessibility laws and perhaps the lawsuit is without merit. Disclosure Now Required     In order to comply with the Bill’s mandate, landlords should ensure their commercial leases executed after July 1, 2013 include language stating whether the property has been inspected by CASp, and if so, the results of such inspection.  It is important to note that a review by CASp continues to remain voluntary by a property owner.  The Bill simply requires disclosure in the lease whether an investigation by CASp has been completed or not.  It seems advantageous for an owner to request an inspection if they believe they are in compliance for the added protection against a disability lawsuit and the comfort to a potential tenant.  However, if the property does not pass, the owner would be required to disclose that fact in the lease.  This could be disconcerting to a prospective tenant who may wonder if any future compliance costs for the building will be passed down to them or if all of their guests will have proper access to the property.     The issues discussed in this update are not intended to be legal advice and no attorney-client relationship is established with the recipient. Readers should consult with legal counsel before relying on any of the information contained herein. Reuben, Junius & Rose, LLP is a full service real estate law firm.  We specialize in land use, development and entitlement law.  We also provide a wide range of transactional services, including leasing, acquisitions and sales, formation of limited liability companies and other entities, lending/workout assistance, subdivision and condominium work.

​ Today the Planning Commission took up consideration of a policy related to the life of Planning Commission approvals.  This has been an evolving area of San Francisco Planning policy over the last decade.  While certainty surrounding the subject has generally improved over the years, there are still several areas where standardized Planning Commission motion language is confusing or conflicting.  New proposed Planning Commission conditions relating to entitlement validity, expiration and renewal should improve clarity going forward.  New performance conditions for future projects may also include a “law of the day” provision that would require the project to comply with all provisions of the Planning Code in place at the time the building or site permit for the approved project is issued.  Finally, the proposed new policy includes a “stimulus program” that may help a number of projects delayed by the recession move forward more quickly. We believe that the stimulus program may in fact provide some relief to a group of projects approved in the last eight years where building permits have not yet been issued and have either gone past their performance requirement or are in danger of doing so shortly.  As for the new performance conditions, it will add some clarity to the status of entitlement following commission approval, but will not dramatically change the existing system.  Projects will still be allowed to seek extensions from the Commission when they get near or past the three year entitlement performance period.  Finally, the law of the day policy is one that should be looked at more closely in the future, possibly through legislation, so that the City can come up with a more formalized and certain vesting program that will give developers and property owners more certainty with respect to what rules apply when. Summary Past Projects ‘Opt-in’ Stimulus Program: Projects authorized in the last eight years will be able to ‘opt-in’ to the stimulus program.  Enrolled projects’ authorizations would not need further extensions or consideration by the Planning before issuance of a building permit, on the condition that the sponsor secures a site or building permit within 18 months.  These projects would have to comply with the “law of the day” policy described below. Future Projects: Three-year implementation time frame.  If period expires, sponsor can apply for extension.  If sponsor declines, Planning Commission must hold public hearing to consider revocation of authorization. Law of the Day: The sponsor would have to conform to all provisions of the Planning Code in effect at time of approval of the site or building permit. The Commission is scheduled to have a second hearing, and possibly take action, at their April 4, 2013 meeting. Approved But “Expired” Entitlements – The Opt-In Stimulus Program The proposed policy opens a 60 day window during which projects approved between April 4, 2005, and October 4, 2011, but which have not yet received a building or site permit, would have an opportunity to ‘opt in’ for an extension.  These projects would not need to seek a separate extension for re-approval or extension.  The extension is conditional on the sponsor receiving a site or building permit no later than October 4, 2013 (18 months after the Resolution) and would have to comply with the law of the day.   Projects that do not receive a building or site permit within the 18-month period shall apply for an amended or a new authorization.  If the sponsor chooses not to file such an application, the Commission shall hold a public hearing to consider revocation or extension of the authorization.  Projects that choose not to enroll in the program will need to seek new authorization or extension from the Planning Commission on an individual basis. The ‘opt-in’ program will only be available to projects that have not already received extensions of performance time periods, do not involve any wireless telecommunication facilities, and have an estimated construction cost of no less than $500,000. Clarifying Performance Conditions For Future Projects The new draft ordinance proposes to keep the three-year implementation policy and requires a project sponsor, where the three-year period has expired, to seek renewal of the authorization by filing an amendment or a new application with the Commission.  If the project sponsor declines to file or withdraw the project, the Commission will hold a public hearing to consider revocation or extension of the approval. These new policies would only apply to Conditional Use Authorizations, Downtown Project Authorizations, and Eastern Neighborhoods Large Projects Authorizations; they would not apply to Prop M controlled office projects or tower projects in Rincon Hill.   Re: “Law of the day” Both proposed new policies would implement the “law of the day” rule.  As such, a site or building permit would not be signed off on by the Planning Department unless the project complies with all provisions of the Planning Code in effect at the time of approval, regardless of whether such provisions were in effect at the time of the original authorization. A special thanks to our law clerk Vadim Sidelnikov, who assisted in preparation of this update.    The issues discussed in this update are not intended to be legal advice and no attorney-client relationship is established with the recipient. Readers should consult with legal counsel before relying on any of the information contained herein. Reuben, Junius & Rose, LLP is a full service real estate law firm.  We specialize in land use, development and entitlement law.  We also provide a wide range of transactional services, including leasing, acquisitions and sales, formation of limited liability companies and other entities, lending/workout assistance, subdivision and condominium work.

​On February 26, 2013, the West SoMa Area Plan (“Plan”) was introduced, along with implementing ordinances, zoning map amendments, height and bulk revisions, and administrative code revisions, at the Board of Supervisors’ Land Use Committee.  A map of West SoMa is included at the following link.   http://www.sfplanning.org/Modules/ShowDocument.aspx?documentid=7405 The West SoMa Community planning process began in 2001.  A draft West SoMa Community Plan was published in September 2008, and updated in October 2011.   The Planning Department seeks to adopt and implement the final West SoMa Community Plan. The core policies and supporting discussion in the Plan is proposed to be added to the General Plan. The Area Plan, together with the General Plan, Planning Code and Zoning Map Amendments provide a comprehensive set of policies and implementation programming to realize the purposes of the Plan. The Plans and Planning Code Amendments outline public improvements, funding mechanisms and interagency coordination the City must pursue to implement the Plan. The Plan lays the policy foundation for additional changes that are detailed in the Planning Code and Zoning Map amendments and other proposed implementation measures.  The following key principles are the basis for the objectives and policies contained in the Plan: Encourage new housing at appropriate locations and make it as affordable as possible to a range of City residents; Reserve sufficient space for production, distribution and repair activities, in order to support the City’s economy and provide good jobs for residents; Generally maintain the existing scale and density of the neighborhood, allowing appropriate increases in strategic locations; Plan for transportation, open space, community facilities and other critical elements of complete neighborhoods; Protect and support the social heritage resources of the Filipino and LGBT communities within the plan area; Plan for new development that will serve the needs of existing residents and businesses; and Maintain and promote a diversity of land uses, and reserve new areas for arts activities and nighttime entertainment. The core policies and supporting discussion in the Plan have been incorporated into an Area Plan proposed to be added to the General Plan. The General Plan, Planning Code, and Zoning Map Amendments, along with the Implementation Document, provide a comprehensive set of policies and implementation programming to realize the objectives of the Plan. The Implementation Document outlines public improvements, funding mechanisms, and interagency coordination the City must pursue to implement the Plan. Residential neighborhoods play a major role in the West SoMa.  The scale and character of the residential neighborhoods on the existing alley system break up the otherwise large SoMa block pattern. The residential enclaves are a defining element of the neighborhood character.  For example, preservation survey work in this neighborhood recognized this pattern and determined that much of the West SoMa is potentially eligible for designation as a “Light Industrial and Housing Preservation District” for.  The Board of Supervisors legislation enabling the West SoMa Citizens Planning Task Force (Ordinance 731-04) highlighted the need to evaluate, identify and protect these residential enclaves. The current zoning in West SoMa does not allow nighttime entertainment as a permitted use in any district, including the 11th Street corridor, which is currently zoned as SLR (Service Light-Industrial Residential).  Since the broader South of Market rezoning in 1990, all nighttime entertainment uses have persisted as legal nonconforming uses, with some allowance for expansion of existing venues via the Conditional Use process.  The West SoMa Plan proposes to rezone the 11th Street corridor and the surrounding area as WMUG (West SoMa Mixed-Use-General), which maintains the prohibition on new entertainment venues, and generally permits housing along with a broad range of small-to-moderate scale commercial activities. The Plan will Create Several New Zoning Districts The Plan proposes to allow new nighttime entertainment venues as principally permitted uses in the SALI (Service Arts Light Industrial) and WMUO (Western SoMa Mixed Use-Office) districts, which are proposed broadly south of Harrison Street.  The SALI district will not permit housing or office uses, and could generally be characterized as a PDR district.  The WMUO district also will not permit housing, but it will principally permit office uses.  The proposed zoning also prohibits new nighttime entertainment within a 200-foot buffer around all RED (Residential Enclave Districts), which currently exist or are proposed along many alleys throughout the Plan area.  The net result will be additional areas zoned for office use, entertainment, residential use, and continued protection for certain PDR areas. Planning Code Amendments The major zoning Planning Code Amendments that are included in the West SoMa Plan include the following: Many SLR districts (Service Light-Industrial Residential) will become RCD (Residential-Commercial District); WMUG (West Mixed-Use-General); RED-MX (Residential Enclave District- Mixed) Folsom NCT (Folsom Neighborhood Commercial Transit); WMUO (Western SoMa Mixed-Use-Office); and SALI (Service Arts Light Industrial).  The Planning Department website identifies the proposed new zoning for each block and lot within the West SoMa area, along with the permitted and conditional uses for each zoning district. The SLI district will allow nighttime entertainment venues as principally permitted uses.  The WMUO districts, which are primarily south of Harrison Street, will allow office use.  The WMUO district will not permit housing.  The proposed zoning also will prohibit new nighttime entertainment uses within two hundred feet of RED (Residential Enclave Districts), which are proposed along many alleys throughout the Plan Area.  Note that the proposed boundaries for the new zoning districts may be adjusted during the Board of Supervisors hearing process. Existing nighttime entertainment uses would be able to request a conditional use authorization to expand.  WMUO districts will principally permit nighttime entertainment uses, office uses, and a broad range of commercial uses, including PDR (Production Distribution and Repair) uses.  No new residential uses would be permitted in the WMUO district.  No new residential uses would be permitted within a buffer area around existing nighttime entertainment uses.  The buffer area is expected to be approximately 200 feet.   Merger with Eastern Neighborhoods Area The current proposal provides that the West SoMa area will be merged into the Eastern Neighborhoods Area, and will be subject

​The Planning Department is anticipated to present a Draft Plan for the Central Corridor Project (“CCP”) to the Planning Commission in an informational hearing of February 28th.  The CCP EIR has already been initiated, and planners are currently targeting Plan approval by the end of 2014.  The CCP would change zoning districts and building heights in the South of Market Area, surrounding the southern portion of the Central Subway Rail Corridor.  The Plan would also include a range of public realm improvements designed to enhance pedestrian experience and livability in the area.  The CCP area is composed of lots within approximately two blocks of the Central Subway Rail Corridor, in an area bounded by Mission Street to the north, Townsend Street to the south, Sixth Street to the west and Second Street to the east.    A number of parcels in the southwest portion of the CCP area, located roughly between Sixth Street to west, Fourth Street to the east, Harrison to the north and Townsend to the south, will also fall within the boundaries of the Western South of Market Area (“Western SoMa”) Plan Area.  The Western SoMa Plan was approved by the Planning Department on December 6th and is anticipated for review and approval by the Board of Supervisors within the next few weeks.   The CCP will up-zone the Western SoMa parcels as discussed below.   The goal of the CCP is to encourage future commercial, office and residential growth in the transit-rich area surrounding the Central Subway line, while preserving the existing mid-rise character of the South of Market Area.   To this end, industrial districts in the CCP Area would be rezoned to allow office, some hotel and residential uses, except along the freeway west of Fourth Street.   South of Harrison Street, controls would be placed on large parcels to encourage commercial uses.  The Plan is estimated to result in an increased capacity of 6,000 new housing units and 30,000 new jobs, above what is possible under the existing area zoning controls. The CCP, which will be funded by a Transportation Planning Grant from Caltrans, has been in the works since early 2011.   Planning began its first community outreach efforts in February 2011, and spent the remainder of the year soliciting community feedback through public meetings, walking tours, a storefront charrette and community surveys.   In November 2011, Planning released a set of Draft Land Use Principles and Urban Form Principles for the area.   Most recently, in June 2012, the Planning hosted a public workshop to present and receive feedback on refined plan concepts for all aspects of the CCP.   The CCP Draft Plan is anticipated to propose the following zoning changes: – Zoning in the Downtown Area (roughly those parcels located north of the freeway, above Folsom Street) would remain unchanged; – Current Mixed Use Districts (roughly those parcels located north of the freeway and along Second Street) would be consolidated in to MUO Districts east of 5th Street, and MUG Districts west of 5th Street; – Current Industrial Districts (roughly those parcels located south of the freeway and west of Second Street) would be re-zoned to MUO, except for parcels along the freeway, west of 4th Street; – A new South SoMa SUD would require commercial uses on new construction of large parcels over 20,000 square feet; – A new SoMa Entertainment SUD, located in the southwestern portion of the Plan area (those parcels located between Bryant, Sixth, Townsend and Fourth Streets), would allow entertainment uses as-of-right. The CCP Draft Plan is also anticipated to propose changes to height limits in the area.  Planners are considering two possibilities with regard to height limits in the CCP Area: (1) a “Proposed Height Limit”; and (2) a “Higher Height Limit Alternative.” Under the “Proposed Height Limit”, the following changes would be made: – Major street frontages in the plan area would be given a 65-foot to 85-foot base; – Sculpting would be required along alleys and near open spaces; – Large floor plate mid-rise buildings up to 130 feet would be allowed in key growth areas; – 130 foot to 320 foot emphasis would be provided at stations, particularly at Fourth Street and Brannan Street, and Fourth Street and Townsend Street. Under the “Higher Height Limit Alternative”, the following changes would be made: – Greater height limits would be allowed for parcels at the southern end of the corridor; – 180 foot to 400 foot emphasis would be provided at stations; – 160 foot tall parcels would be allowed along Fourth and Fifth Streets; – A 200-foot height district on Second Street would be extended southward toward the freeway; Maps depicting these changes are available as part of the Planning Department’s June 13, 2012 Public Workshop Boards, at:  http://www.sf-planning.org/index.aspx?page=2557. The CCP is also anticipated to propose changes to urban form, which would include expanding the boundaries of the existing South End Historic District by approximately one half block; applying the Transferrable Development Rights Program to the Central Corridor; setting new mid-block alley requirements for large lots; proposing new building scale and massing controls, including a 15 foot setback for all buildings above a street wall base of 65 to 85 feet; and creating a new Conditional Use requirement to discourage consolidation of multiple small lots in certain areas.    The CCP would also implement a range of pedestrian-oriented improvements to encourage livability in the Central Corridor as residential and job density in the area increases.  These improvements would include widening of sidewalks on most major streets; creating pedestrian improvements to South Park Avenue at Third and Second Streets; reconfiguring travel lanes on Brannan, Fourth, Third, Folsom, and Howard Streets; creating 25 new signalized pedestrian crossings; and establishing new bicycle lanes on Brannan, Second, Third, Fourth and Fifth Streets. In addition, the CCP would improve public open spaces.  Currently, the portion of CCP area located south of the freeway has few open space amenities that would support the Plan’s anticipated increase in population density, aside from South

​NEW CALIFORNIA STATE LAWS A few new state laws went into effect on January 1st that affect condominium projects and homeowners associations (“HOAs” ).  While not groundbreaking, the new laws may be of interest to our readers in the condominium industry.  Below is a brief overview: AB 2273: When a condo unit owner is in default on its mortgage and facing foreclosure, the owner is typically also in default on its payment of assessments to the HOA.  This may leave the HOA without sufficient funding to perform its maintenance and other obligations.  In the event a condo unit is foreclosed upon and sold at a foreclosure sale, it may be difficult for an HOA to quickly identify and bill the new owner in order to avoid a lapse in collection of assessments for that unit.  To facilitate an HOA’s ability to identify the new owner after a foreclosure sale, this law amends the Davis-Stirling Common Interest Development Act (“Act”) by adding Section 2924.1 to the Civil Code, and by amending Civil Code Section 2924b.  The law requires that (i) a trustee’s deed must be recorded within 30 days of the foreclosure sale (thereby making the new owner’s name public record), and (ii) information requested by the HOA about the new unit owner must be mailed to the HOA within 15 days after date of the sale.  These rules are intended to enable HOAs to minimize gaps in the collection of assessments in order to maintain financial stability. AB 1838: Under the Act, HOAs must provide certain documents to a prospective condominium purchaser before transfer of title to the unit.  In connection with a request for such documents, the HOA must prepare a required form that contains an estimate of the fees and costs associated with providing the requested documents.  This law amends Civil Code Sections 1368 and 1368.2 of the Act in response to perceived overcharging of such costs and related fees to condo unit owners and prospective purchasers.  In the event such a document request is rescinded, the new law generally prohibits cancellation fees and requires the HOA to refund related fees and costs, so long as sufficient notice was given and the document copying has not already taken place. SB 880: This law is intended to further promote use of electric vehicles in the state by clarifying existing provisions in the Act to facilitate installation and use of electric vehicle charging stations in condominium projects.  The new law amends Civil Code Sections 1353.9 and 1363.07 to provide that the governing documents of a condo project may not prohibit the installation or use of an electric vehicle charging station, subject to certain limitations.  The law applies to electric vehicle charging stations both in an owner’s exclusive use parking space, and in the general project common area. Note: The laws described above are not intended to be an exhaustive list of all new state laws that may affect condominium projects or HOAs.  This list merely represents those laws that we believe will be of the most interest to our clients and readers of this Update.  The laws also apply to other types of common interest developments in California. UPDATE ON PROPOSED SAN FRANCISCO CONDOMINIUM CONVERSION ORDINANCE Condominium Conversion Impact Fee: The new ordinance sponsored by Supervisors Farrell and Wiener was discussed at the meeting of the Board of Supervisors Land Use and Economic Development Committee this Monday, January 28th.  After nearly 4 hours of public comment where the Committee heard impassioned statements from both tenancy-in-common (“TIC”) owners in support of the legislation, and tenants and tenants rights advocates in opposition of the legislation, the Committee voted to postpone its vote and continue the matter until February 25th in order to give the opposing interests time to attempt to negotiate a compromise.  As we reported in last week’s Update, the ordinance would provide qualifying TIC owners a one-time opportunity to bypass the onerous condominium conversion lottery upon payment of a fee to the City.  We will continue to monitor the legislation and provide future updates on its progress.  Those interested in this issue should contact their Supervisor to voice their opinion. Correction: Last week’s Update erroneously stated that “the conversion of a building with more than six (6) apartment or tenancy-in-common units to condominium subdivisions is limited to 200 units annually, which are selected in a condominium lottery.”  In San Francisco, conversions of buildings with more than six (6) apartment or tenancy-in-common units to condominium subdivisions are not permitted.  The lottery is held for condominium conversions of buildings with six (6) or fewer apartment or tenancy-in-common units.  The maximum number of units that can be converted to condominiums City-wide in any given year is 200.  Certain qualifying conversions of buildings with two (2) apartment or tenancy-in-common units may bypass the lottery. The issues discussed in this update are not intended to be legal advice and no attorney-client relationship is established with the recipient. Readers should consult with legal counsel before relying on any of the information contained herein. Reuben & Junius, LLP is a full service real estate law firm. We specialize in land use, development and entitlement law. We also provide a wide range of transactional services, including leasing, acquisitions and sales, formation of limited liability companies and other entities, lending/workout assistance, subdivision and condominium work.

​As the state’s Metropolitan Planning Organizations (MPO) begin to roll out their Sustainable Communities Strategies (SCS) pursuant to SB 375, the first agency to actually adopt an SCS has stumbled out of the gate.  On Dec. 3, 2012, Judge Timothy Taylor of the San Diego Superior Court has struck down the EIR for the SCS adopted by the San Diego Association of Governments (SANDAG). The Legislature adopted SB 375 in 2008 as part of the implementation of Governor Schwarzenegger’s AB 32, which requires the State of California to reduce its greenhouse gas (GHG) emissions to 1990 levels by 2020.  SCS’s are the cornerstone of SB 375.  The purpose of the SCS is to use land use and transportation planning strategies to help the region meet its mandated GHG emissions reduction targets.  These new planning strategies could have a dramatic effect on metropolitan development patterns in the years to come. The state Air Resources Board (ARB) has issued regulations for each MPO pursuant to AB 32 that set specific GHG emissions reduction targets by the years 2020 and 2035.  However, prior to AB 32, Governor Schwarzenegger issued Executive Order S-03-05, which calls for an 80 percent reduction in GHG emissions statewide by 2050.  Until the SANDAG decision, Executive Order S-03-05 had been largely forgotten.  ARB has set no target for 2050, nor did AB 32.   The petitioners in the SANDAG case successfully exploited this inconsistency among target years. Like many MPO’s across the state, SANDAG’s SCS was combined with its regional transportation plan (RTP).  While the SCS projected out to 2050, the RTP projected out only to 2035.  Because the RTP projected out to only 2035, SANDAG’s EIR did not fully study the environmental impacts of the combined SCS/RTP out to 2050.  Judge Taylor concluded that this inadequacy violated CEQA.  He criticized the EIR for failing to recognize that “Executive Order S-03-05 is an official policy of the State of California,” and chastised SANDAG for analysis that did no more than “‘kick the can down the road’ and defer to ‘local jurisdictions.’”   The SANDAG decision is important because it puts other MPO’s around the state on notice.  The Bay Area’s SCS, being drafted by ABAG, currently projects emissions levels out to 2040.  Their EIR is scheduled for release this Spring, with certification and adoption of the SCS scheduled for Summer.  ABAG now must decide whether to wait and see what happens with the expected appeal of the SANDAG decision, go ahead and revise the SCS and EIR, or assume the risk and proceed as is.  We will continue to inform readers of developments in the case and ABAG’s adoption of its SCS.    The petitioners in the case were Cleveland National Forest Foundation and the Center for Biological Diversity, and they were joined by the state Attorney General after the lawsuit had been filed.  Cleveland Nat’l Forest Foundation, et al., v. San Diego Ass’n of Governments, San Diego Superior Court Case No. 2011-00101593.        SAN FRANCISCO CONSIDERS ALLOWING PAYMENT OF IMPACT FEE TO AVOID 2014 CONDO CONVERSION LOTTERY Currently in San Francisco, the conversion of a building with more than six (6) apartment or tenancy-in-common units to condominium subdivisions is limited to 200 units annually, which are selected in a condominium lottery. To participate in the lottery, a specified number of building owners must continuously occupy a unit(s) in the building for at least three years in advance of the lottery. The selection process is based, in part, on seniority of participation in past lotteries. Supervisors Mark Farrell and Scott Wiener have introduced an ordinance that would allow any building that participated in the 2013 condo conversion lottery but was not selected, or could have participated in the 2013 condo conversion lottery but chose not to, to avoid the 2014 lottery and qualify for a subdivision conversion by paying an impact fee of $20,000 per unit.  As currently written, the ordinance affects only the 2014 lottery.    The ordinance is scheduled to go before the Land Use and Economic Development Committee on Monday, January 28. Additional ordinance details are as follows:       The fee is reduced based on the number of the years a building has participated in the lottery.  A building can receive a fee reduction of up to 80 percent per unit after 5 years or more of participation.       To participate, applicants must pay the full fee for the entire building no later than Jan. 24, 2014.       DPW will determine whether the condo conversion subdivision application is complete no later than July 24, 2014.       The applicant will obtain the final and effective tentative approval of the condo subdivision or parcel map no later than December 31, 2014. This time can be extended to July 24, 2015 by DPW.       Those participating in the fee conversion program must provide lifetime lease options for non-purchasing tenants.       A subdivider or subsequent condominium owner may not refuse to renew or extend a lease or rental agreement to any non-purchasing tenant at the time of final map or parcel map approval.       Fee reductions are available in exchange for the lifetime lease requirement.        The issues discussed in this update are not intended to be legal advice and no attorney-client relationship is established with the recipient. Readers should consult with legal counsel before relying on any of the information contained herein. Reuben & Junius, LLP is a full service real estate law firm. We specialize in land use, development and entitlement law. We also provide a wide range of transactional services, including leasing, acquisitions and sales, formation of limited liability companies and other entities, lending/workout assistance, subdivision and condominium work.