Thursday, December 15, 2016

San Carlos to Put a Stop to Lot Splits

In response to concerns about increasing neighborhood density, the San Carlos Planning Commission recommended last week that the city revert to pre-2011 development standards, which were much more stringent on minimum lot sizes.  This change would increase the minimum lot sizes from 5,000 S/F to 10,000 S/F, and lot width from 40 to 65 feet.  It also puts restrictions on flag lots, which are parcels of land at the end of a long driveway with no road frontage.  The Planning Commission voted 5-0 in favor of this recommendation.

Zoning changes made in 2011 allowed construction of larger homes, and for homeowners of lots 10,000 S/F of more to split their lots in order to increase the city's supply of housing.  They allowed for homes to cover 50% of the total lot square footage, rather than the 40% permitted under pre-2011 zoning laws.  In addition to allowing for the construction of larger homes, the increased lot coverage makes constructing accessory dwelling units possible for more homeowners.

The city had already placed a moratorium on the 2011 zoning changes back in June.  This was in response to resident complaints that homes were being built too large on lots that were too small, and that lots splits were leading to too much neighborhood density.

San Carlos, like most cities on the peninsula, has seen a recent surge in housing demand due to nearby job growth.  This has attracted the attention of developers and builders who see that there is money to be made in San Carlos.   But increasing density is hardly ever a popular idea in small close-knit communities like San Carlos, so it's not much of a surprise to see residents push back against more relaxed zoning laws.

Thursday, December 8, 2016

Facebook Pledges $20 Million to Affordable Housing

Last week, Facebook announced they will spend $20 million to help alleviate the housing shortage in their neighbor cities of Menlo Park and East Palo Alto. About $18.5 million will go towards building new housing, mostly targeted at low/middle income families, while the rest will go towards job training programs and providing legal assistance to tenants facing eviction. This announcement comes as Facebook and other tech giants have been facing growing pressure to partner with local governments and community organizations to find solutions to the region's housing shortage - a problem which many feel has been exacerbated by unchecked tech growth.

Bird's eye view of Facebook's recent campus expansion.  Chilco Street is the only thing separating it from East Menlo Park's Belle Haven community (visible in the top left)

Facebook's rapid expansion into East Menlo Park, a historically low-income region, has been a point of contention as of late.  Early in 2015, they opened up a brand new 430,000 S/F Frank Gehry designed campus expansion within shouting distance of East Menlo Park's Belle Haven community.  Almost immediately after they cut the ribbon on that building, they submitted plans to the City of Menlo Park to redevelop an adjacent property into roughly 1 million square feet of additional office space.  That project - also Frank Gehry designed - was promptly approved, and construction has been underway for over a year now.  With all of this new office space to put to use, Facebook has estimated that they will bring 6,500 new employees to the area in the coming years.

A coalition of local community organizations had planned to sue Facebook over the stress 6,500 new employees could put on an already overburdened housing market.  However, after a series of meetings with Facebook representatives, they agreed not to.  Tameeka Bennett, executive director of Youth United for Community Action, one of the groups in the coalition, said she is convinced that Facebook is committed to partnering with the community to address the housing shortage.  And more so than any of their Silicon Valley peers, their actions have demonstrated as much.

Facebook's recent $20 million announcement isn't the first commitment they have made to combat the housing crisis.  Last year, in partnership with St. Anton Development, they broke ground on a 394-unit apartment complex at 3639 Haven Avenue.  Those units will be offered to non-Facebook employees, and 15 of them will be subsidized by Facebook for low-income families.  They extended their commitment to constructing publicly available housing earlier this year, when they unveiled a proposal to build 1,500 total units, 15% of which would be reserved for low to middle income families.  This hands on approach to tackling the housing shortage is completely breaking the mold of how Silicon Valley tech companies offer support to communities impacted by their growth.  While it is fairly common for companies to pay "impact fees" to help fund affordable housing, it is unprecedented for them to actually build the housing themselves.

To be fair, this isn't a completely altruistic effort on the part of Facebook.  Housing costs in the Bay Area have made it increasingly difficult for companies like Facebook to recruit the talent they want, so adding to the supply of housing serves their interests by driving those costs down and making it easier for them to recruit.

Perhaps others will follow Facebook's lead.  There are certainly plenty of eyes on Google in Mountain View, and Apple in Cupertino, hoping they will make similar efforts.  Stay tuned

Friday, November 4, 2016

New Redevelopment Proposal Submitted for Old Redwood City Theater

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SyRes Properties, LLC - the company that owns Redwood City's defunct Century 12 Theater - recently submitted plans to redevelop the 15-acre property into 336 residential units and a 100,000 S/F luxury sports club.  This is a revision of a plan they submitted to the city last year which originally proposed 550 residential units.  At the time, city officials told SyRes that 550 units needed further review and would require the land the be rezoned for high density development.  Previous attempts to redevelop the land into rental units and auto dealerships have all fallen through.
“We've received a revised application and it's currently considered conceptual at this point", said Lisa Cost-Sanders, the city planner assigned to the project.  "We'll be providing the developers with additional comments and will be restarting the Environmental Impact Report process shortly.”
SyRes is the real estate branch of the Syufy family, who are known for their chain of Century Theaters.  In recent years however, the family has begun redeveloping their older cinemas into luxury VillaSport athletic clubs, as they are in the process of doing with an old theater in San Jose, and are currently hoping to do in Redwood City.  They currently operate three active VillaSports in Texas, Colorado, and Oregon, with single adult monthly dues ranging in price from $92 - $138 (expect that to be higher at Bay Area locations).
Other than serving as extra parking for neighboring auto dealerships, the property formerly occupied by Century 12 Redwood City has remained mostly vacant since the theater closed in 2003.  Should the recent SyRes proposal pass, it will become the second major development along Redwood City's bayfront, with One Marina Homes just a stone's throw away. However, even with the reduction in proposed residential units from 550 to 336, this project is sure to be put under heavy scrutiny by city officials for it's potential to further congest the Highway 101/Whipple junction.  It also comes at a time when city hall is facing growing pressure from the community to put the brakes on development.
This proposal is by no means a slam dunk for the Syufy family, who have had no luck getting anything approved for their property at 557 East Bayshore.  Stay tuned to our blog for further updates on this project.

New Wine Bar & Cafe Open at Box HQ, Redwood City

Donato Scotti, owner of Donato Enoteca in downtown Redwood City, has opened a wine bar, retail store & cafe at the new Box Headquarters at 900 Middlefield Road.  Cru Wine Bar & Merchant offers hard to find wines from around the world, as well as an international and domestic craft beer selection.  A European style menu featuring charcuterie plates, pizza by the slice, sandwiches and other treats are served as well.
The first day of service was November 2nd.  The cafe opens at 8am, and lunch service begins at 11am - stop by and check it out!



Thursday, October 27, 2016

Redwood City Council Shoots Down Moratorium on Steep Rent Increases


Redwood City councilmembers reaffirmed their opposition to any form of rent control at Monday night's meeting when they shot down a proposed moratorium on rent increases.
The Housing and Human Concerns Committee was tasked to meet with residents and stakeholders before making recommendations to City Council Monday about how to address the city's affordable housing crisis.  One of the proposals they put forth was a temporary freeze on rent hikes greater than 7-10%.   The proposal was met with general unease from the council, as 4 members voted against it outright, and the remaining 3 voted for more research to be done before proceeding.
“I don’t see a distinction between a moratorium on rent increases and rent control. And, rent control is proven not to work. It doesn’t treat everyone fairly, including everyone on the tenants’ side fairly, and doesn’t treat everyone on the landlords’ side fairly", said Redwood City Mayor John Seybert.  "Our council across the board has spoken in opposition of rent control, this isn’t something new".
City council did show interest in other alternatives to addressing affordable housing.   They instructed staff to continue studying the viability of a relocation assistance program, and discussed possibly requiring longer lease terms in order to limit the frequency of rent increases.
With rent control on the November ballot in both Burlingame and San Mateo, it will be interesting to see what effect the results of those elections will have on rent control's momentum in Redwood City.  Even without the backing of city council, rent control could make it on the next ballot if community activists obtain enough resident signatures.

Monday, October 24, 2016

Wells Fargo Scandal Shines Light on Benefits of Loan Advisors

As many of you have probably heard, Wells Fargo is currently embroiled in a cross-selling scandal involving millions of fraudulent accounts being made without their clients’ knowledge (cross-selling is when a different product/service is sold to an existing customer). Wells Fargo’s abuse of this practice – which is standard in the banking industry - was the result of bankers cutting corners to meet ridiculous product per customer quotas passed down by company executives.
While we'd like to think that most bankers aren’t subject to the same quotas that Wells Fargo employees were, most bankers are incentivized in one way or another - through bonuses, promotions, pay raises - to open up as many accounts per client as possible. If you’ve ever opened an account or taken out a loan with a major bank or credit union you’ve probably been at the receiving end of aggressive cross-selling before - “We recommend you move your car loan over to us”, or “While you’re here, can I interest you in opening up a savings account?” In the case of Wells Fargo, the pressure put on bankers to open these extra accounts was enough to lead many to fraud.
This is one of the advantages to working with a loan advisor rather than going to straight to a bank/credit union for your mortgage.  They have no financial incentive to do anything other than to make sure you are satisfied and feel comfortable referring them more business later on down the road. Just some food for thought!
If you're thinking about buying a home and you'd like to be put in contact with one of my preferred loan advisors, feel free to reach out - I'd be happy to make the introduction.

Wednesday, October 5, 2016

Commuter Ferry Service From East Bay to Redwood City Approved

East Bay commuters inching their way to the Peninsula every morning through bumper-to-bumper traffic will have an alternative come 2017.  Last week, the California Public Utilities Commission voted to allow two private ferry companies, PROP SF and Tideline Marine Group, to operate scheduled public ferries from Berkeley and Emeryville to San Francisco and Redwood City.  Tideline will actually begin limited service to San Francisco by the end of this month and expand as demand grows, but PROP SF plans to roll out their Redwood City routes by the first week of 2017.
In April, Redwood City's Port Commission penned a letter to the Bay Area Water Emergency Transportation Authority expressing disappointment that they had not included Redwood City in their long-term strategic plans for expanding their public ferry service.  At the time, the WETA  (the government agency tasked with expanding ferry service across the Bay Area) cited concerns that ridership in Redwood City would not be sufficient to make the program economically viable just yet.  The ferries WETA currently operate from SF to the East Bay carry 300 passengers, and they rely heavily on rider fares to cover costs.   Both Tideline and PROP SF operate much smaller vessels, ranging in size from 36-100 passengers, so they are less limited by ridership goals.
Take a look at the short video below showing one of Prop SF's 36 passenger vessel:


and one of WETA's much larger vessels:
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WETA gave the Redwood City Port Commission a 7 point plan to follow in order to initiate service, part of which suggested that the city partner with a company like Google or Facebook to fund the program.  Currently, both companies use small private ferry services to shuttle employees to Redwood City from the east bay, but there has been talk for some time that RWC could form a public/private partnership with Google to fund WETA's expansion into RWC.  That talk intensified when Google purchased about a million square feet of office space at the Pacific Shores Center near the Port of Redwood City back in 2014.
Even with a Google partnership, I'd imagine the introduction of Tideline and PROP SF into the equation has just cast further doubt on WETA's future in Redwood City.  They were already concerned about ridership, and now their 300 passenger vessels would have to compete for ridership with two other companies.  I've reached out to the Redwood City Port Commission for comment and am awaiting their response.  You can check into my blog for updates.

Thursday, September 15, 2016

Two SM County Cities Moving Forward With Rent Control Initiatives

Come November, residents of San Mateo and Burlingame will have their say on rent control.  In San Mateo, community activists were able to obtain well over the 11,000 signatures required to place their proposed rent control measure on the ballot, and in Burlingame city officials put forward their own measure.  Should either pass, it could set a precedent for the rest of San Mateo County.

The pro-rent control movement gained a lot of momentum over the past year and a half, fueled by several widely circulated "evict, renovate, and increase rent" stories.  The case that probably garnered the most media attention, and helped catapult the rent control debate into the public discourse, was that of the 18-unit apartment complex at 910 Clinton Street in Redwood City.  The complex was sold, and the new owners promptly served all tenants a 60-day notice to vacate so they could proceed with renovations.  However, instead of vacate, many tenants chose to stay and rally in front of the building for more time - a demonstration that quickly took the form of a protest for rent control.  One of the tenants, a 14-year old high school student, became the spokesperson for the evicted tenants, and his pleas for rent control were run on virtually every major public news outlet - NBC Bay Area, Kron 4, ABC 7.  Ultimately, the issue was resolved when the owners agreed to assist the evicted tenants with relocation costs.  910 Clinton Street, now called "Velocity at Clinton", currently offers 1 bed, 1 bath apartments at roughly $2,500/month.

Since the evictions at 910 Clinton, rent control proponents in Redwood City have done everything in their power to make their voices heard by lawmakers - from organizing roughly 200 people outside of City Hall, to marching down El Camino.  The issue was eventually taken up in City Hall, but rather than put forth a rent control initiative, city officials agreed to pass a per square foot impact fee on new development that will go towards building more affordable housing.  However, if either measures pass in Burlingame or San Mateo, tenant advocacy groups in Redwood City could take up rent control again with a renewed sense of confidence.

I won't get too deep into my own views on rent control, but everyone should hear the case against it - especially since that side is rarely covered in the media.  Rent control essentially creates a subsidy paid for by a small group of private citizens (rental property owners).    These people are paying the subsidy through the money they are losing by not being able to rent their property at market value.  Let's look at it this way: if affordable housing is a viewed as a right that should be afforded to ALL citizens, is it fair to levy the burden on providing that right on a minority group within the population?  And if it's fair to set a price ceiling to protect renters, is it then also fair to set a price floor to protect property owners in the event the rental market bottoms out?

Another factor to take into consideration is that rent control could actually serve to decrease the supply of rental units.   Short term, rent control could constrict the rental supply by scaring some landlords out of the business.  This has actually already begun in Burlingame, where the owner of a 10-unit apartment building recently served his tenants notice to vacate, citing that he did not want to run the risk of having to operate his building under a rent control ordinance.  In the long run, it could slow the construction of new rental units, as many developers would likely shy away from building in a city with a rent control ordinance.  Let's remember, it's a shortage of available rental units fueling the affordability crisis in the first place.  Anything that would further tighten supply could exacerbate the issue.

No one would argue that families being displaced by rising rents isn't an issue.  The question is:  is rent control the practical solution to the affordable housing crisis, or the emotional one?

If you own rental property in Mateo County, take note.  If a rent control ordinance is established in San Mateo or Burlingame, it could become the standard bearer for similar ballot initiatives elsewhere in the county.  Read below for a brief synopsis of each

Burlingame - Measure R
Measure R would accomplish three things:  repeal Measure T, which currently prohibits the City of Burlingame from regulating real estate sale/rental prices; establish a rent control ordinance; enact just cause for eviction provisions.

The rent control ordinance would apply to all multifamily residential buildings with initial certificates of occupancy before February 1, 1995.  It excludes single-family homes, condominiums, owner-occupied duplexes or secondary dwelling units, hotels, motels, hospitals, certain nonprofits, dormitories and certain governmental facilities.  The ordinance would establish a base rent for each tenancy based off the amount paid on March 30,2016.  Under this ordinance, rent increases would be limited to once per year, and will be restricted to an amount proportional to the rate of inflation (but no more than 4%).  Tenants would be able to petition for lower rents if their landlords provide substandard housing, decrease housing services, or increase rent above what is allowed under the ordinance.  Conversely, landlords would be able to petition for rent increases under some circumstances to ensure a fair rate of returns.

The just cause eviction provision would apply to all units under rent control as well as single family homes, condominiums, and most multi-family residential units regardless of date of construction.  Reasons for a just eviction include: failure to pay rent, breach of lease, nuisance, criminal activity, and failure to grant reasonable access.  Landlords must pay relocation assistance to tenants for evictions based on necessary repairs, owner move-in, removal of unit from rental market, and demolition of unit.  Relocation assistance under this provision would constitute 3 months rent for a similar unit.

San Mateo - Measure Q
Measure Q is very similar to Measure R, with the key difference being that no existing law needs to be repealed to allow for rent control.

Like Burlingame's Measure R, Measure Q would set a base rent for each tenancy and limit subsequent rent increases.  Base rents would be determined by the amount the tenant paid on September 21, 2015.  For tenancies beginning after that date, base rents would be the rate paid upon initial occupancy.  The limits on rent increases are the same as Measure R - once annually, in an amount equal to the increase in Consumer Price Index (but no greater than 4%).  Landlords and tenants can petition for higher/lower rents for reasons similar to those described in Measure R.

The just cause eviction provision in Measure Q is almost identical to what is described in Measure R, except that the amount of relocation assistance paid to a tenant when applicable has not yet been determined.  It will be decided by City Council within 6 months of the Measure passing.

Tuesday, August 23, 2016

Redwood City School District: Achievements & School Info

Despite being one of the lowest State funded districts in the county, the Redwood City School District has been able to achieve a great deal in the way of improving facilities, quality of education, and student performance.  Just this past November, voters showed their support for continuing those efforts by approving Measure T - a $193 million bond that will be used to upgrade and repair schools within the Redwood City School District.
In honor of the start to the new school year, let's take a look at a few of the RCSD's other recent accomplishments:
-North Star, Adelante, and Orion named California Distinguished Schools
-Roy Cloud, Taft, Hoover, & Roosevelt given Gold Ribbon Awards - an award given to honor schools while the California Distinguished Schools Program is on hiatus as California transitions to new assessment and accountability systems
-North Star Academy recognized as having one of the highest API scores in the state (ranked #4 in 2013).  It was also honored as a National Blue Ribbon School in 2012, a coveted award which over its 33 year history has been presented to roughly 8,000 schools nationwide.
-Seven district schools have API scores over 800 or 900: Adelante, Clifford, Roy Cloud, Henry Ford, Orion, North Star Academy and Roosevelt.
-Several RCSD schools earned the Kent Award for innovative practices from the San Mateo County Board of Education: Adelante, Clifford, Henry Ford, Kennedy, Hoover, North Star Academy and Orion.
-Adelante ranked 2nd for the Spanish Embassy's School of the Year in 2016
-The entire K-3 teaching staff was presented the San Mateo County Literacy award in 2011 for their work in using assessments to improve reading.

Monday, August 8, 2016

Stanford Submits Design Plans For Phase 1 of RWC Campus


Though it's still a long ways from becoming reality, the future of the Stanford in Redwood City project is starting to come into focus.  Nearly 10 years after purchasing the former Mid-Point Technology Park on Broadway, Stanford University has officially submitted design plans to the city for approval.  They will go before the Architectural Advisory Committee this month, before heading to the Planning Commission for review in September.  If approved, phase 1 of construction will break ground in Fall of this year, with completion tentatively slated for 2019.    

According to Stanford's project updatephase 1 of construction will include:

- four office buildings
- a town square and park (open to the public)
- outdoor dining areas and plazas
- a child care center
- a parking garage
- a glass atrium fitness center and its own sustainable central utility plant

The timeline for completion of the rest of the project is unclear, but when it's all said and done, Stanford in Redwood City will feature:

- 35-acre campus
- 1.5 million square feet for offices, medical clinics, and R&D
- 13 total buildings
- 2,400 Stanford employees working on the Redwood City campus after the completion of phase 1 (making it the city's 3rd largest employer)
- 2.4 acres of publicly accessible open space



Stanford in Redwood City, which will be located between Broadway and Bay, Douglas and Second,  will incorporate the same look and feel of the main campus in both the architecture and the public spaces.  In a video posted to the Stanford in Redwood City website, University Architect Dave Lenox says, they "want to evoke that same emotion that people feel coming down Palm Drive walking into the main quad, and just feeling that sense of awe."  Stanford has pledged $15.1 million towards public benefits as a part of the deal, and they also plan to run their Marguerite shuttle (which is free and open to the public) between the two campuses.  Barron, Warrington, and Hurlingame Avenues will all be extended through the site.

Redwood City becoming host to a world-renowned institution such as Stanford feels like a symbolic final piece to the city's transformation - from "Deadwood City", to a bustling hub of business, research, and entertainment.  But this project is quite a bit different from all the others.  Unlike Crossing/900, or the apartments at 201 Marshall - which are in highly visible downtown locations -  Stanford in Redwood City will be peripheral to the city's downtown hub.  Instead of being flanked by restaurants and shops, it will border two densely populated, lower-income communities - North Fair Oaks and Friendly Acres - both of which stand to see property values increase as a direct result of Stanford's arrival, the money they invest into the community, and the real estate investors they attract.  This, of course, is good news for homeowners, and not so good news for the many renters that populate the area (we'll save that conversation for another day).  We'll be keeping an eye on these two communities as the project progresses.

Thursday, July 7, 2016

Massive Office Complex Receives Approval From City of San Carlos


Last week, San Carlos reached an agreement with developer Windy Hill Property Ventures to construct what will become the city's largest ever office development.  

Meridian 25 - named for its 25 mile distance from San Jose and San Francisco - will be a 528,520 square foot Class A office complex on Industrial Road off Bransten.  It will consist of two 6-story office buildings, and a 6-level (3 underground) parking structure with 1,510 parking spaces.  The site will also include approximately 2-acres of landscaped area with 150 new trees. 

The agreement between San Carlos and Windy Hill also includes $4 million that will go towards building a more pedestrian friendly route from Industrial to Old County.  This, in conjunction with the development of the San Carlos Transit Village - a mixed use residential and commercial project that will be built around the train station - will help better connect San Carlos east of El Camino to the shopping and dining rich Laurel Street.

San Carlos is home to a relatively small supply of office space, which is a large part of the reason they have a hard time attracting and holding on to high profile tenants.  Most notably, in 2009 they lost Tesla Motors to Palo Alto, due in part to their inability to accommodate the company's growth.  However, the city's unanimous approval of the massive Meridian 25 development has likely already placed them on the radar of some big name tenants.

To get an idea of just how transformative Meridian 25 could prove to be for the City of Good Living, all you have to do is look to Redwood City, where their Crossing/900 development was eagerly snatched up for use as the new headquarters of Box Inc.  Over the course of Thanksgiving weekend last year, the cloud file sharing company relocated nearly 1,000 employees from their old Silicon Valley headquarters to their new downtown Redwood City digs.  This made Box downtown Redwood City's largest private employer, without including the additional 800 employees they intend to move in over the next couple of years.

Meridian 25 will dwarf Crossing/900 - exceeding it in size by nearly 200,000 square feet.  It will also possess just as much, if not more commuter appeal as Crossing/900, due to its proximity to Highway 101 and the San Carlos train station (soon to be the San Carlos Transit Village).  The convenience for commuters plays a significant role in attracting large companies, in particular large tech companies, as they typically have a sizable chunk of their workforce commuting from San Francisco.  The shorter commutes and the cheaper rent are why many tech companies are beginning to favor Peninsula office space over the South Bay.

For now it's all speculation as to who might move in, but with city approval of the project, its listing agents can begin to market it aggressively to prospective tenants.  It's possible that it will get leased out in chunks to smaller companies, but it's also possible we see another big tech player like Box step in and grab the bulk of the available office space.  Either way, it will be interesting to watch all of this unfold in a city that has been historically resistant to change and development.

Stay tuned!

Tuesday, June 28, 2016

Rent Stabilization Ballot Initiative Moves Forward in San Mateo

UPDATE: Election officials announced that enough signatures have been verified and the "San Mateo Community Preservation and Fair Rent Charter Amendment" will be placed on the November ballot.

Come November, San Mateo residents will have their say on rent stabilization.  On Monday, tenant protection advocates turned in over 11,000 signatures calling for a citizens vote on rent control measures - well over the 7,119 required to bring it to the November ballot.   This was a grassroots effort, as it involved nearly 200 volunteers canvassing the city for about 2 months to obtain the 11,000+ signatures.
The "San Mateo Community Preservation and Fair Rent Charter Amendment" would cap rent increases at 4% per year, unless a landlord refrains from rent increases for an additional year, at which point rent could be raised up to 8%.  It also includes a just cause eviction provision, which would prevent tenants from being evicted unless they breach the terms of their lease, break the law, fail to pay rent, are a nuisance, if substantial repairs are needed, if the property will no longer be used as a rental, or if the landlord plans to move in.
Exceptions to the rent increase amendment would include condominium units, or secondary units and duplexes where a landlord lives on site.  Properties built after February 1, 1995 would also be exempted from the rent increase cap.  No rentals would be exempt from the just cause eviction provision.
This amendments's placement on the November ballot is not official yet, as the Elections Office has 30 days to validate the signatures. On August 1st, City Council will meet to discuss the findings of the Elections Office and determine if the amendment will be placed on the ballot.  If it is, a simple majority approval is needed to pass, and in a city where nearly half of its residents are renters, that certainly seems within the realm of possibility.  The question is whether or not enough renters show up to vote.
It will take a strong voter turn out on the part of those in favor of rent stabilization to pass this measure - the opposition will almost certainly be well represented.  The California Apartment Association, which represents homeowners, trade associations, and businesses, is among those fighting against any sort of rent control measures wherever they pop up across the Bay Area.  They are a part of the taskforce assembled to address San Mateo's housing crisis, and their position is essentially that what rent control gives to renters, it takes away from homeowners.   They believe this could end up making the housing crisis worse by pushing some landlords out of this business, and disincentivizing landlords from adequately maintaining their properties and attending to their tenant's needs.
We'll keep you updated as news break.

Tuesday, June 21, 2016

Crash Course on Eichler Homes

Joseph Eichler was a visionary real estate developer who built thousands of his eponymous homes all across Northern California from roughly 1949-1966.  Here on the San Francisco Peninsula, we are home to some of the largest and oldest Eichler tracts.
According to Joseph Eichler's son, the inspiration for the Eichler design came from a Frank Lloyd Wright designed home in Hillsborough, which the family rented out for a short period of time.  Eichler was attracted to the custom-built modernist architecture, and set to incorporate that look into tract housing that would be affordable to the working class.  Eichler worked closely with a Frank Lloyd Wright disciple, Bob Anshen, and several other architects later on, to cultivate what would ultimately become the most easily recognizable homes of the mid-century modern era of architecture.
A 1950 Eichler we recently sold in the Atherwood tract of Redwood City.  Key Eichler features:  vaulted wood-beam ceilings, floor-to-ceiling windows, wood paneled walls (visible to the left)

The homes are built on the concept of "bringing the outside in", and usually feature glass walls oriented towards the backyard, vaulted wood beam ceilings designed to create a more open and airy living space, and an open floorplan allowing you to look out to the back yard from the front entrance.  Often an atrium would be incorporated into the home, to help further blur the line between outside and in.  Eichlers are also easily recognized from the street by their low sloping (and often A-framed) roofs.

Another shot of the Atherwood Eichler we sold.  Notice the low sloping roof line.  Later Eichlers often incorporated the A-frame roof into their design

The Eichler home came at a time in the post-war era where cookie cutter ranch-style homes were immensely popular, and for many WWII veterans coming home seeking convention rather than innovation, the Eichler design didn't resonate.  Mr. Eichler never profited greatly from Eichler Homes.
Beyond his accomplishments as a real estate developer, Joseph Eichler is highly lauded for his anti-discrimination stance towards housing.  He offered homes for sale to anyone regardless of religion of race, and he actually resigned from the National Association of Home Builders in 1958 when they refused to support a non-discrimination policy.
Notable Eichler Neighborhoods on the Peninsula:
-The Highlands in San Mateo:  Largest contiguous Eichler tract
-Atherwood in Redwood City:  among the oldest Eichler neighborhoods (built in 1950)

Monday, June 20, 2016

The Eichler Effect

In a time of strong economic performance and job growth here on the SF Peninsula, it has become commonplace for new homeowners and real estate investors to tear down and rebuild dilapidated or out of style homes to maximize their market value.  Despite this, the peninsula’s many Eichler tracts have, for the most part, managed to resist these character changing trends.  I attribute this to two factors: activism within Eichler communities to preserve what they believe to be historic neighborhoods, and the Eichler owner’s genuine appreciation for the iconic mid-century modern look.

You’d be hard pressed to find a city more vigilant about preserving their history than Palo Alto.  As such, it comes as no surprise that Palo Alto has been among the most active in fighting to preserve their Eichler neighborhoods.  In 2005, residents of the Green Gables and Greenmeadow Eichler tracts succeeded in having their neighborhoods placed on the national registry of historic places.  While this designation doesn’t expressly prohibit anyone from purchasing and demolishing an Eichler, it establishes a hostile environment towards anyone with those intentions.

But even without a collective effort within a community to preserve them, Eichler neighborhoods seem to resist change more than others.  Take the Atherwood subdivision in Redwood City for example.  Despite being one of the first Eichler tracts (developed in 1950), there have been no major movements to preserve them.  Yet for the most part they remain intact.  We were able to gain some insight as to why that may be recently when we actually purchased one of the Atherwood Eichlers and had a chance to speak with the neighbors.  It was clear that everyone we spoke to felt an attachment to their Eichlers, either for their historical significance, their “bring the outside in” design concept, or a combination of the two.  So when these homeowners decide to renovate, they do so in a manner that is sensitive towards preserving the Eichler style.  They update the homes rather than rebuild them.

Whether or not you appreciate the Eichler style - glass walls and atrium designed to blur the line between outside and in, and vaulted wood beam ceilings over an open floorplan to create an airy living space - these homes represent a unique time in architectural history.  To learn more about Eichler homes, reference my last blog post! Crash Course on Eichler Homes

Wednesday, June 8, 2016

Huge Proposed Apartment Complex in RWC Faces Pushback From Residents

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In early March, Greystar Development submitted a proposal to Redwood City for the redevelopment of 1409 El Camino - a block that is currently home to a Vet Hospital, Hair Salon, and Body Shop.  The proposal calls for the construction of an eight-story 350-unit apartment complex, with 35 units reserved for lower-income families.  At a proposed 300,000 S/F, it would be almost as big as Redwood City's largest building - the new Crossing/900 Development downtown, which totals roughly 330,000 S/F.
The project is still in the early planning stages, but it's already receiving a great deal of pushback from residents who think it is too big and does not include enough below market rate units.  Some of those in opposition had planned to attend a May 31st Architecture Advisory Committee meeting in protest, but the meeting was cancelled due to a revision made to the proposal shortly before the scheduled date.
In the Facebook Group, Redwood City Residents Say: "What?" - a popular forum for the city's residents to voice their concerns - come members commented that the addition of high density housing on an already busy stretch of El Camino (near the Jefferson intersection) would make traffic even worse.  One group member expressed that while he appreciates much of the downtown revitalization that has occurred as a result of the Precise Plan, perhaps the city is taking on too much too fast.  He added that he felt it was time for Redwood City to take a step back, complete the projects that have already been approved, and move forward in a more thoughtful manner.
It's not difficult to see where these concerns about too much development too fast are coming from.  Redwood City's development map shows 4 other major residential developments within a couple blocks of 1409 El Camino that are either under construction, approved, or completed but not yet fully occupied.  These projects total 708 residential units, with a projected 1,300+ resident capacity.  This most recently proposed development would bring the total number of brand new residential units in this few square block area to over 1,000.
Current Proposed, Approved, and Recently Completed Residential Developments Near the busy Jefferson/El Camino intersection:
Screenshot 2016-06-06 16.41.03
3 - 299 Franklin Street - Status: Built
  • Includes 305 residential units on 6 stories
11 - 103 Wilson Street - Status: Under Construction
  • Includes 175 residential units on 7 stories
12 - 1305 El Camino - Status: Approved
  • Includes 137 units on 8 stories
13 -  299 Franklin Street - Status: Approved
  • Includes 91 residential units on 8 stories
16 - 1409 El Camino - Status: Proposed
  • Includes 350 residential units on 8 stories
NOTE: Including the projects mentioned above, the city has already approved or completed the construction of 2,336 residential units of the 2,500 allowed under the Downtown Precise Plan (according to documents obtained from the city planner).  This 2,500 unit maximum allowable development cap applies only to the downtown area, so projects like the recently completed 141-unit Lane on the Boulevard (now called Oakwood Redwood City) would not count towards it.
To share your comments and concerns about this recently proposed development at 1409 El Camino, feel free to reach out to the city planner managing the project: Lindy Chan - lchan@redwoodcity.org.  You can also reach out to city council at council@redwoodcity.org.

Wednesday, May 25, 2016

Redwood City Docktown Residents to Begin Relocation in 2017


After failing to pass legislation to temporarily preserve Redwood City's Docktown Marina, it's lifespan may have just been shortened from 15 years to about 15 months.  A lawsuit settled in January of this year calls for residents to begin relocating in 2017, and an urgency bill that would have kept the Docktown in operation for the next 15 years was recently dropped because not all residents got behind it.

The floating community (located off Maple St, along the Redwood Creek) has existed since 1964 without any issue, mostly because no one had complained about it.  But late last year someone did, by filing a suit against the city alleging the Docktown was in violation of health and safety code, and that the city has been illegally collecting money for the private use of land that is actually held in trust by the state for the benefit of the people of California.  The city collects somewhere around $750,000/year for renting out slips to Docktown residents.

The suit was filed by Attorney Ted Hannig, who lives right across the creek from the Docktown in One Marina Homes.

State Sen. Jerry Hill (D-San Mateo), and Assemblyman Kevin Mullin (D-South San Francisco) were able to get the bill to preserve the community approved by the State Lands Commission under the conditions that:

1) The city would prohibit new tenants, new liveaboard watercraft and transfer of existing watercraft at Docktown
2) The city would mandate that all liveaboard watercraft be owner-occupied or city owned. No subleases would be allowed.

Some residents possess multiple slips from the city, and rent out or Airbnb their houseboats.  These residents opposed the bill's conditions and consequently it failed to pass - to the dismay of those who would just like the extra 14 years in their homes.  So now, with no legislative action, the future of the Docktown defaults to the agreed upon terms in the Hannig settlement - which is to begin locating residents next year.

There are about 70 liveaboards and 100 residents in Docktown.  The $4.5 million Hannig settlement sets aside $3 million towards cleaning up the creek and assisting residents with relocation.  The remaining $1.5 million goes to Hannig.

Thursday, May 19, 2016

Bay Area Real Estate Market: Hot or Cooling Off?

Despite increased talk around the Bay Area that the market seems to be cooling off, the rest of the country continues to rank us as the hottest market for real estate.  Realtor.com released a report at the end of April that ranked the SF area as the top in the country, and just today Inman News published a blog titled, "10 hottest real estate markets for summer 2016", in which we came in at #1.  But how can we be the hottest market in the nation if we're actually cooling off?
Inventory has picked up in many areas across the Bay Area, which has softened competition a bit.  This is especially true in Redwood City, where our inventory of over 60 homes for sale is nearly double what it was this time last year.  As a result, some homes have sat on the market longer than what we had grown accustomed to in recent years, which has spurred much of the conversation about a market cool-down.
But there is one important thing to remember - our real estate market over the past few years was the exception, not the rule.  Average days on market for a listing in Redwood City in May '15 was about 11 days.  Now it's about a week longer.  But inventory was unfathomably low for the majority of 2015, and with our economy booming, demand was very high (as it still is today).  Competition among buyers was so intense that practically every listing received multiple offer inquiries right off the bat - most of them contingency free.  So yes, our real estate market has cooled off a bit from it's white hot 2015 state, but that doesn't mean it's cold.  The more accurate way to describe today's market would be that it has come back down to earth (slightly).  Consistently high demand fueled by a 3.3% unemployment rate will sustain high prices in the Bay Area.
We can't use last year's market as a measuring stick for this year's.  Redwood City's current average DOM of 18 days sound like a long time next to last May's average of 11 days.  But compared to the nationwide average of 67 days (per Realtor.com), I'd say 18 isn't too bad...

Thursday, May 5, 2016

State Senate Passes Bill to Encourage Building More In-Law Units

How to go about addressing the affordable housing crisis has been a contentious issue in the Bay Area to say the least, with public & private interest groups butting heads on virtually every solution that has been offered up.  At the end of April however, state legislators were able to make some progress by passing a bill that many are calling a "common sense solution".  

SB 1069 passed in April, and reduced many of the regulatory roadblocks to constructing an accessory dwelling
Senate Bill 1069, introduced by State Senator Bob Wieckowski (D-Fremont),  will do away with many of the regulatory roadblocks that homeowners face when trying to construct accessory dwellings on their property.  This will limit parking restrictions, fees for water and sewer hookups, as well as take 30 days off of the maximum amount of time a city can take to process permits, with the ultimate goal being to encourage and expedite the construction of these units.
Accessory dwellings are unique in that they offer a way to increase much needed inventory, without actually having to visibly increase density.  Karen Chapple, a professor of city planning at UC Berkeley, and a proponent of the bill, refers to these units as "hidden density", since most of them are tucked away in backyards and don't affect a block's curb appeal.  For this reason their increased construction is much less likely to be opposed by others in the community.
Further, unlike rent control or other tenant protection ordinances which their opponents argue unfairly tilt the playing field in favor of the tenant, facilitating the construction of accessory dwellings has benefits for both the homeowner and the tenant.  The obvious benefit for the tenant would be the increase in smaller, more affordable rentals.  On the flip side, homeowners with "too much home" are now able to more easily leverage that excess space into rental income.  It's a mutually beneficial approach to addressing an issue that has proven to be very divisive.

At the end of the day, spurring the construction of accessory dwellings is just a drop in the bucket when it comes to alleviating our housing shortage, but at least legislators are finding ways to work together to achieve some sort of progress.

Wednesday, April 13, 2016

San Mateo City Council Fails to Pass Tenant Protections

At a public meeting on Monday night, San Mateo City Council met to decide on whether or not to pass temporary tenant protection measures, but the contentious meeting was adjourned without a single vote being cast.  This was the second of two meetings that were held to address a report provided by the city's housing task force, which highlighted a 40% increase in rent over 4 years, and a huge imbalance in jobs to available housing.
After failing to reach an agreement on a 90 day just cause eviction and rent control ordinance last week, the Council was again incapable of coming to a meeting of the minds about a proposed relocation assistance program this week.  The relocation assistance program would have required landlords to pay tenants six months worth of the area’s median rent for a similar size unit if they evicted tenants without just cause or give steep rent increases of 10 percent or more.  This temporary measure was supposed to protect tenants from landlords preemptively raising rents while the city, tried to come up with a more long term solution.
Frustrated with the city's inaction, tenant groups opted not to attend the latest meeting.  Reyna Gonzales, a representative from Faith in Action - a group that has been lobbying for tenant protections - issued the following statement regarding tenant absence:
“Over the past 18 months, we have been to more than a dozen city meetings, have participated in the city’s task force, have shared painful, personal stories, and have watched hundreds of families and seniors in our community be displaced while the council deliberated what action to take. We are tired of witnessing how the voices of special interests seem to continually outweigh the voices of residents. We are choosing not to attend tonight’s meeting because it is clear that the council will not take action to address this crisis in a meaningful way”
Those in opposition to tenant protection measures however (mostly landlords), were heavily represented at the meeting.
For now, both parties seem to be resigned to let the issue of tenant protection/rent control be decided by the voters on the November ballot.

Thursday, April 7, 2016

Redwood City to Discuss 15% Affordable Housing Requirement

At Redwood City's April 11th City Council meeting, they will be holding a study session to mull over the possibility of amending the Precise plan to reserve 15% of all new housing development for affordable units.   There are 2,500 housing units left to be constructed under the Downtown Precise Plan.  If a 15% affordable housing amendment were to be passed, that would mean at least 375 of those would be below market rate.
In addition to this proposed amendment, the council is expected to choose a developer to build a 100% below-market-rate housing complex on city owned land at 707 & 777 Bradford Street.  The city will be handing over the land (which is worth an estimated 8 million dollars) to the chosen developer at no cost.
No vote will be cast at the meeting regarding the amendment, but a vote will be cast to choose between the 5 development proposals that were submitted for the Bradford Street affordable housing project, which will include anywhere between 56-137 units for low to very low income families.
City Council has turned their attention towards affordable housing in recent months.  Back in October, they passed a $20 per square foot fee on all new office and residential developments, and a $5 per square foot fee on retail and housing.  The estimated $5 million in annual revenue these fees will generate will go towards affordable housing.
The City also donated $1.5 million to Habitat for Humanity for the construction of 20 affordable units on Jefferson Avenue, which we discussed in a previous blog post.

Tuesday, April 5, 2016

Mid-Peninsula Real Estate Market Not Red Hot in Quarter 1

Persistently low inventory kept home prices high through the first quarter of 2016, though growth has cooled off considerably.  The average sales price of a home on the mid-Peninsula - which I define as San Mateo, Foster City, Belmont, San Carlos, Redwood City, and Menlo Park - grew just 2.9% from Quarter 1 of 2015 ($1,586,414) through Q1 of 2016 ($1,632,449).  By comparison, over that same stretch of time from 2014-15, average sales price grew 16.6% - from $1,359,787 to $1,586,414.   

Though it may still be too early in the year to tell, this may be an indicator that the market is finally starting to push back against what many had deemed to be unsustainable price growth.  For over a year now, there has been talk among real estate professionals and economists that some degree of pullback was inevitable in the Bay Area real estate market, as price growth simply could not continue to outpace income growth to the extent that it has.  At some point, either demand would diminish, which would ultimately slow prices down, or incomes would have to see a huge boost.  The former presents the more likely scenario, and it seems that is what is beginning to happen.

For much of 2015, demand was so high that sellers were often fielding multiple offers before they even hosted an open house.  Transactions were frequently done in cash, and closing times were historically short.  In the early part of 2016, the real estate market is starting to look a bit different.  The right homes in the right neighborhoods are still selling quickly at prices that continue to impress, but homes with a few quirks/flaws are starting to sit on the market a bit longer.  Listings across the mid-peninsula in Q1 of 2016 stayed on the market for an average of just over 19 days - still a healthy number, but up from 16 days the same time last year.  In certain cities, the disparity between those numbers is much more dramatic.  Like in Redwood City, where the average DOM grew 100% - from 14 days in Q1 of '15 to 28 days in Q1  of'16. 

Much of this can be attributed to the demand for higher end real estate becoming far less reliable.  The decrease in demand is allowing buyers at the higher price points to be more selective, and contingent offers are becoming more common.  In Redwood City, Q1 sales of $1.6 million and above sat on the market for an average of 31 days, as opposed to 21 days for sales in the range of $1-1.6 million.  By contrast, the average DOM for sales in both of those price ranges in Q1 of 2015 was just 12 days - so it is evident that the decrease in demand has taken a heavier toll on higher end real estate.

Despite the slight slowdown in the first part of 2016, I am still dismissive of the idea that there may be an impending market crash, or even a significant pullback.  Prices may not be growing at the breakneck pace they were just a year ago, but the Bay Area's healthy economy and rapid job growth should continue to fuel strong demand for mid-priced real estate, even if the high end comes back down to earth a bit.  

As a seller, the best move you can make to prepare for the possibility of a longer transaction, is to enlist the help of a real estate agent who is adept at identifying characteristics of a property that could adversely effect desirability/sales price, and who can advise you on simple/cost efficient ways of improving on these features - something the RealSmart Team specializes in.  

Mid-Peninsula Market Statistics: Quarter 1 - 2016





Wednesday, March 30, 2016

RWC to Amend Precise Plan, Bring More Retail to Main St.

In a 6-0-1 vote at Monday night's City Council meeting, city staff were directed to make an amendment to the Downtown Precise Plan to require Active Ground Floor Uses on Main Street between Broadway and Middlefield.  This will eliminate office as an acceptable use, but allow for retail, restaurants, and possibly personal/business services such as hair salons and entertainment uses in certain areas.
The amendment will allow storefronts which currently house office space to continue operating as such until the building becomes vacant for at least six months, at which point the new zoning laws will take effect.
Prior to Redwood City passing the Downtown Precise Plan in 2011, zoning laws were in place that required retail in Main Street storefronts.  However, vacancies weren't filling up, and in an effort to bring more money to the city, the zoning laws were changed to broaden the acceptable uses to include office.  Most of the vacancies were filled accordingly, but as we all know, times have changed considerably in Redwood City since 2011 and storefronts that used to sit vacant now have droves of eager tenants hoping to set up shop in the Peninsula's most up and coming city.
Sequoia Hotel, 800 Main St., Redwood City, CA 9-5-2011 6-08-59 PM
To many, this intersection at Broadway and Main marks the end of what Downtown has to offer.  The city seeks to change that perception.

City Council had been facing pressure from the Downtown Business Group and some residents to take up the issue of Amending the Precise Plan, as they felt that the pedestrian appeal of that particular section of Main Street was suffering from the overabundance of offices.  Main Street from Broadway to Middlefield is currently home to several well regarded restaurants/bars, such as Martin's West, Striped Pig, Angelica's and a few others.  Still, for those of whom word of mouth does not reach, that area tends to be missed on a stroll through downtown.  The hope is that bringing retail back will increase foot traffic to that corner of Downtown Redwood City.
Retail is a crucial component of any thriving downtown, and despite Redwood City's recent boom, the retail scene has yet to flourish as it has in other Peninsula hotspots like Palo Alto and Menlo Park.  Broadway is populated almost entirely by restaurants and bars, with only a few exceptions.  Perhaps this amendment will get the ball rolling in Redwood City's retail revival.
Details of the amendment have yet to be hammered out, but we will keep you updated as they are.