Two affordable housing measures are currently proposed for the November 5, 2019 ballot: (i) City Charter and Code amendments to encourage certain 100% affordable and teacher housing projects by providing for a streamlined ministerial — i.e., no CEQA — approval process for qualified projects and (ii) an up-to $500 million affordable housing bond.

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California voters will consider a November ballot initiative (Proposition 10) that would repeal the 1995 California Costa-Hawkins Rental Housing Act (“Costa-Hawkins”). Costa-Hawkins generally limits rent controls that may be imposed by local jurisdictions on housing units in buildings with a certificate of occupancy issued after February 1995, prohibits local jurisdictions from expanding rent control to include “vacancy control,” and exempts single-family homes and condominiums from rent controls, with limited exceptions.
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Competing special purpose tax measures are on the San Francisco June ballot, both of which would raise the tax on gross receipts from the lease of commercial space in San Francisco.  The tax rates in the measures – generally, 1.7% and 3.5% – would be a steep increase over the current gross receipts tax rate applicable to commercial rents of around 0.3%.  Either proposed tax would be in addition to the gross receipts tax already in effect and would become operative on January 1, 2019.

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San FranciscoWith rising housing costs remaining a priority concern for the region, affordable housing had a major presence on Bay Area ballots this November. As detailed below, voters in three municipalities and three counties across the Bay Area passed measures to increase affordable housing funding for low and moderate-income households. Taken together, these measures will yield about $2 billion in new housing funds.

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Admittedly the issues may appear benign compared to the Presidential race and the drugs, sex and other provocative topics on the state ballot.  But San Francisco voters again face a long list of significant local propositions on November 8th, and among them are a number of measures impacting real estate taxes, land use and governance.

Unfamiliar Terrain summarizes the key measures impacting our industry:


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Production, Distribution, and Repair (PDR) space is a hot commodity in San Francisco.  Over the past few years, numerous organizations, policymakers, and elected officials have been engaged in efforts to preserve existing and create new PDR, community, and arts spaces, particularly in SoMa.  Supervisor Kim, who previously sponsored the moratorium on conversion of PDR space in SoMa that expired in October, has sponsored Proposition X for the November ballot.  Prop X would impose a conditional use and on-site replacement requirement for many new projects or changes of use that displace PDR, Institutional Community, or Arts Activities uses.

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ConstructionIn a city hungry for development along the eastern waterfront, one large hurdle looms – the cap on new office space development.  The cap, imposed by the voters as Proposition M in 1986, limits new office development by square footage.  While the cap increases each year by 950,000 square feet, the recent building boom will soon subsume the office space that is available for allocation.

Enter Proposition O on this November’s ballot. 


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tax-468440_1920Transfer tax on the sale of most commercial property in San Francisco will increase if voters approve Proposition W.

If approved, Prop W will increase the transfer tax rate by 0.25% for sales valued above $5 million (increase from $10/$500 in purchase price to $11.25/$500) and above $10 million (increase from $12.50/$500 in purchase price to $13.75/$500).


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