Paula Tejada’s tiny empanada shop is one of the few surviving Latino-owned small businesses left in the Mission District, sitting just a block away from the BART plaza at 16th and Mission streets, an intersection that has become the newest ground zero for the fight over affordable housing in the city.
“The Mission District is a classic example of the transitions that exist in most big cities,” said Tejada, a longtime San Francisco resident and the proprietor of the empanada and coffee shop Chile Lindo. “Immigrant neighborhoods become the whereabouts of bohemians, artists, small business owners and people that work together to make the community better. After they make it better, it becomes the focus of those that speculate with the real estate. Then, everyone that made that community is put in a very vulnerable position and usually squeezed out.”
During the past 20 years, real estate development companies have been building market-rate housing units in the Mission that cater to upper-income tenants. Like Tejada, many of the Mission’s traditionally working-class Latino residents fear that this surge in market-rate development threatens the security of their homes and businesses.
“There used to be so many Latinos,” said Candelario Melendez, another longtime Mission resident as well as a member of Causa Justa, a nonprofit that fights for immigrants’ and tenants’ rights in the Bay Area. “People that I knew, people that I worked with, people that felt like family–but that’s not what it feels like anymore.
Developing the 16th Street plaza
Although many different real estate developers are active in the Mission, the group causing the greatest stir right now is Maximus Real Estate Partners, LLC.
Last October, Maximus filed a Preliminary Proposal Assessment (PPA) at the San Francisco Planning Department and announced plans to build a 351-unit, high-end luxury condo development adjacent to the 16th Street BART plaza. According to the proposal, Maximus intends to demolish the Walgreens and several other buildings that surround the plaza, including three longstanding Mission businesses: Hwa Lei Market, Mission Hunan Restaurant and the City Club.
“This project would bring Valencia rents down to Mission Street,” said Gabriel Medina, policy manager of the Mission Economic Development Agency (MEDA) and an advocate for social and economic justice in the Mission. “Businesses like Hwa Lei, City Club and Hunan will no longer have access to properties that they can afford.
In place of these businesses, Maximus plans to construct two 10-story towers and one five-story building, all three of which will be residential structures designed by the architect firm Skidmore, Owings, and Merrill. Maximus intends to rent all but 12 percent of these units at market-rate, which means that tenants will have to pay between $3,500 and $5,000 per month. Additionally, Maximus stands to earn at least $1 million from each unit sold.
“We believe this is a great project for the community,” said Joe Arellano, spokesman for the developer. “In terms of safety, in terms of the benefits it will bring to [nearby school] Marshall Elementary and in terms of working to potentially help with the housing situation in San Francisco–we say it’s a great project and we’re committed to it.”
The Maximus project at the 16th Street BART plaza will be located among the Mission’s densest clusters of single-room occupancy hotels (SROs) and affordable housing. This area provides some of the last remaining safety nets for the Mission’s low or no-income population, and many people in the Mission worry that that Maximus project will immediately displace the community’s most vulnerable members.
“You’re creating huge tensions between one group that has access to resources and finances and another group that doesn’t have a lot of access,” said Medina. “Where are the people that are in the SROs and affordable housing units going to go?”
Aside from affecting the poorest people in the Mission, the proposed five-story building would literally cast a shadow over Marshall Elementary School, decreasing the children’s access to sunlight. Although Maximus has offered to elevate the school playground in order to keep the shadow level where it is currently, many Marshall parents argue that an elevated playground would destroy the playground’s existing green space of trees, a garden and a welcoming pavilion.
“Once the playground is up in the air and away from the earth, then we’ll lose those three green areas and we’ll never be able to have any additional ones,” said Susan Cieutat, a Marshall Elementary parent who has met with the developers at several of the school’s PTA meetings. “So it’s not a desirable thing that they are offering.”
Parkmerced as precedent
Although no one can predict how exactly the proposed Maximus project at 16th and Mission streets will transform the neighborhood, one possible precedent can be found in Parkmerced, a historic residential neighborhood consisting of townhouses and towers located near the Daly City BART station.
Parkmerced remains one of the first transit-oriented developments in San Francisco and represents the last of the city’s high-density, open-space, affordable housing developments.
Parkmerced is also the site of Maximus Real Estate’s only known office address.
“The goal of Maximus is to make the most profit off these sites,” said Aaron Goodman, who is a member of the urban environmental organization San Francisco Tomorrow and an expert on Parkmerced. “They’re an investment group. They’re based on quick flipping of property, and they’re not based on the community’s needs and benefits.”
The principal behind Maximus is a businessman named Robert Rosania, a former CEO of New York-based Stellar Management and the current owner of Parkmerced. After decades of rotating ownership, Rosania took control of Parkmerced and sold much of its property to nearby San Francisco State University. Rosania is now awaiting permit approval to carry out a proposed project that would raze all of the original low-rise townhouses in Parkmerced and replace them with 3-4 and 4-8 story buildings, mostly starting at market-rate rents.
Like any major city, San Francisco will always have its fair share of real estate speculation. What is more troubling, say activists and scholars, is the uncomfortable reality that San Francisco has finally run out of available land on which to build any new affordable housing developments.
“Where and how do you develop density to correct the problems we have in an urban city?” Goodman asked. “We only have so much land that can be developed.”
Supply and demand
Stephen Menendian, a professor at Berkeley’s Haas Institute and a leading academic authority on affordable housing, said that San Francisco’s housing crisis is based on supply and demand.
“There’s a tension between the need for new housing units and the desire for housing prices to stop escalating,” Menendian said. “If you don’t have new housing units, then prices in a market-rate economy are going to continue to rise because demand is outstripping the supply by a great amount.”
According to Menendian, rising housing prices will not only affect local residents, but will also increase rents for the surrounding businesses.
“Property values in and around that neighborhood will go up,” said Menendian. “It may not be the case that anyone is going to be displaced by the demolition of a Walgreens, but that type of thinking ignores the effects of the property and housing in that community, not to mention the change within the community itself. It’s almost inevitable that people will be displaced as these neighborhoods slowly change and people are ultimately priced out.”
The potential impact that the Maximus project poses to the Mission District has spurred neighborhood residents into action. More than 50 community organizations have united under the loose banner of the Plaza 16 Coalition and are demanding, among other things, that Maximus engage in a more transparent project development process.
“The process that we’ve seen so far is that the developer has been organizing several small meetings of interest,” said Gabriel Medina, whose MEDA organization belongs to the coalition. “We want to make sure that anything that’s going to impact one of the most traditionally working-class intersections and neighborhoods in San Francisco will include everyone and be for everyone, not just one group or entity or person.”
Despite the coalition’s concerns, Maximus has insisted that it is dedicated to insuring transparency as the project moves forward.
“We’re not going to work in a vacuum,” said Arellano. “We plan to continually be in contact with all the different players, and nothing will move forward until we have been able to secure all the different variables that we need.”
Regardless of whether or not Maximus will remain true to this transparency pledge, the developer will continue to face strong opposition from the Plaza 16 Coalition.
“They look at 16th and Mission and they see homeless people, dirt and crime,” said Cieutat, a coalition supporter. “The people who live in the Mission see it as an affordable neighborhood that has a strong Latino community.”
On Saturday, Oct. 4, the coalition will hold a rally at 24th and York streets at 2 p.m. and then march to the 16th Street BART plaza. Community members and organizations will gather in the plaza to speak out against the real estate development forces they say are making the old San Francisco neighborhoods unrecognizable.
“We’ve lost something that’s a treasure,” said Tejada. “And in this new wave of total obliteration, we keep losing everything that makes us a sophisticated city.”