support housing for the city’s low-income and homeless
populations, but the action led to “less than a handful”
of projects, said Michael Martin, project director of the
public site development program.
The first problem was that the transfer process was left
entirely to individual departments. There was a natural
inclination under that scenario for departments to hang
on to properties — just in case — and no real incentive
to report them as surplus. Now a central office reviews
each department’s holdings to ensure surplus property is
But a second problem lingers. Most city departments can
transfer surplus property without requiring any financial
return. However, so-called enterprise agencies that generate their own operating revenues like utilities and transit
are legally bound to obtain market value.
That eliminates an important subsidy for affordable housing, yet the enterprise agencies own some of the city’s
largest and best-situated surplus properties. Rather than
throw up its hands, San Francisco is developing a model
for supporting affordable housing while also getting market value for the properties.
Adding market rate housing to cross-subsidize a range
of affordable housing is one possible tool. Another is tax
increment financing, which captures revenue from rising property values.
“The thread that goes through this is that we’re taking a
more active real estate management role,” Martin said.
“The traditional government approach is we have these
holdings, we’ll figure out what to do with them, if there’s
nothing there now, there’ll be something later. But that
era has passed. There just aren’t that many places left to
Brad Broberg is a Seattle-based freelance writer
specializing in business and development issues.
His work appears regularly in the Puget Sound
Business Journal and the Seattle Daily Journal
Adding market rate housing and
tax increment financing support