Facilitate new uses and flexibility in buildings

May 23, 2023

Maximizing the variety of uses and flexibility in our buildings creates the spaces and services that a diverse industry base needs to succeed and will help Downtown recover faster. 

“American Tulip Day in Union Square” by Flower Bulb Day

Strategy

Economies are dynamic and the needs of businesses and institutions change over time. The COVID-19 pandemic triggered a dramatic change in the way office-based businesses operate and how they use office space. Prior to the pandemic, San Francisco’s office vacancy rate was minimal and new businesses struggled to gain access. Now, different office configurations and commercial occupancy models are emerging as businesses adapt to post-pandemic norms. New industries and business types may have vastly different space requirements and configurations. Other underutilized commercial buildings may be able to convert to entirely new uses, such as hotels, institutions, museums and cultural venues, research and design spaces, or housing. By reducing unnecessary zoning and process impediments and actively facilitating the ability of companies and building owners to update and adapt office buildings to emerging uses, we can support new job offerings, economic growth, and a renewed vibrancy in our Downtown. 

The City has begun to advance a series of initiatives and will launch additional programs that support this strategy: 

  • Amend the Planning Code to ensure flexible zoning Downtown to accommodate the widest possible range of activities and uses. 

  • Establish a Commercial-to-Residential Adaptive Reuse Program to facilitate the conversion of underutilized office buildings into housing

  • Develop a recovery entitlement program that would allow time and flexibility for previously entitled development projects to adjust to market conditions. 

 

Initiatives
 

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Flexible zoning Downtown

Downtown’s historically office-centric environment should be a welcoming place for the widest possible variety of commercial, cultural and residential uses and activities. Zoning and process changes can support an active and dynamic experience for residents, workers and visitors.  

  • As part of its Future of Downtown effort, the Planning Department has identified a suite of Planning Code amendments to simplify Downtown’s zoning and building controls in order to support the establishment of new commercial, institutional, and residential uses and flexible spaces through a clear and predictable process. 

  • In April 2023, Mayor Breed and Board President Aaron Peskin introduced Downtown zoning legislation that would streamline approval processes for new developments and alterations to historic buildings, and allow for the following uses in the Downtown core: 

    • A greater density and variety of housing types 

    • A greater mix of uses including laboratories and life sciences, light manufacturing, food and beverage processing, and large-format retail 

    • Office, co-working, design and professional service uses on upper floors in the Union Square Area where they are currently limited or prohibited 

    • Formula retail uses in Mid-Market and existing shopping centers where chain stores are currently subject to special approvals 

    • A new Flexible Workspace use to allow for ground-floor co-working and office spaces in conjunction with a retail component 

    • Pop-up retail, entertainment, arts or other activations in vacant storefronts for up to one year 

  • The legislation was approved by the Planning Commission in May 2023 and is expected to be considered by the Board of Supervisors this summer. 

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Commercial-to-Residential Adaptive Reuse Program

As the City’s economic core, Downtown has developed as a place for offices and businesses that support offices and office workers - leaving a scarcity of housing options. In recent decades significant amounts of housing have been added in and around Downtown, particularly in Rincon Hill, the East Cut and SoMa. The shift in office demand brought on by the pandemic could present a unique opportunity to weave more housing into the City’s office core, creating the potential to support a greater variety of businesses and institutions in the area while also allowing workers to live closer to their jobs. 

  • As part of its Future of Downtown effort, the Planning Department has reviewed recent studies and analysis of the potential for office to housing conversions in San Francisco, successful precedents from other cities including Los Angeles, and identified key zoning and process obstacles to these projects to develop a new Commercial-to-Residential Adaptive Reuse Program. 

  • The flexible zoning legislation that Mayor Breed and Board President Peskin introduced in April 2023 would also establish the Adaptive Reuse program by waiving certain Planning Code requirements, like rear yards, that are not compatible with existing commercial buildings in our dense Downtown core, and directing the Department of Building Inspection (DBI) and the Fire Department to adopt an Adaptive Reuse Manual that will specify alternate methods of Building and Fire Code compliance for these projects. The legislation also specifies that the California Historic Building Code is available to adaptive reuse projects in qualified historic buildings.  

  • The legislation was recommended by both the Planning Commission and Building Inspection Commission in May 2023, and is expected to be considered by the Board of Supervisors this summer. DBI will complete and publish the Adaptive Reuse Manual in the summer.

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Recovery entitlement program 

The economic disruption and market uncertainty brought on by the pandemic has prevented many developments that were entitled in the years leading up to and during the pandemic from moving forward to construction. In some cases, the market has changed and the originally proposed development program needs to be reevaluated. 

  • While project sponsors are reconfirming the viability of their project, the planning entitlements for some may expire or require discretionary approval from the Planning Commission to be extended or modified - adding cost and uncertainty that could risk the feasibility of these projects. 

  • The Planning Department is assessing the inventory of development projects in the pipeline that may seek to extend their entitlements or propose modifications in response to changed market conditions and is exploring options to expedite such extensions or revisions. 

  • Such a program would allow already entitled projects a chance to quickly regroup and pivot to a mix of uses and designs that will be most successful in our new context without having to restart the development process.

 

See other economic recovery strategies

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