PLN Memo Affordable Housing Sites Analysis 101625

October 16, 2025 Ms. Angela Calvillo, Clerk Board of Supervisors City and County of San Francisco City Hall, Room 244 1 Dr. Carlton B. Goodlett Place San Francisco, CA 94102 Re: Transmittal of Planning Department Case Number: 2021-005878PCWP Housing Element 2022 Rezoning Initiatives – Affordable Housing Sites Analysis and Strategies (AHSAS) Planning Commission Recommendation: Informational Dear Ms. Calvillo: On October 16, 2025, the Planning Department published the Draft Affordable Housing Sites Analysis and Strategies Report which will be presented to the Board of Supervisors Land Use and Transportation Committee along with the Family Zoning Plan on October 20, 2025. As a part of the transmittal, the Planning Department is hereby requesting that the attached Draft AHSAS Report be uploaded to the Family Zoning Plan Board Files as supporting materials. The Family Zoning Plan Board File Nos. include: 250966, 250700, 250701, and 250985. The Planning Department will publish the Final AHSAS Report along with additional appendices that will include various consultant memorandums on the Department’s project webpage at a later date. In the interim, if you have any questions or require further information, please do not hesitate to contact me. Sincerely, James Pappas Manager, Policies and Strategies Transmittal Materials CASE NO. 2021-005878CWP Affordable Housing Sites Analysis and Strategies 2 cc: John Carroll, Office of the Clerk of the Board Lisa Chen, Principal Planner [email protected] ATTACHMENTS : Draft Affordable Housing Sites Analysis and Strategies Report Affordable Housing Sites Analysis and Strategies DRAFT REPORT OCTOBER 2025 AFFORDABLE HOUSING SITES ANALYSIS & STRATEGIES 2 Contents Executive Summary of the Affordable Housing Sites Analysis and Strategies Report ....................... 3 Section 1: Introduction......................................................................................................................... 9 Section 2: Input from Affordable Housing Practitioners and Community ......................................... 12 Section 3: Need for Affordable Housing Funding .............................................................................. 14 Section 4: Existing Practices and Pipeline ......................................................................................... 17 Section 5: Parcel Suitability Analysis ................................................................................................ 26 Section 6: Financial and Policy Research .......................................................................................... 33 Section 7: Recommended Strategies ................................................................................................ 41 Conclusion ......................................................................................................................................... 46 Acknowledgments This report was made possible through the collaboration and expertise of staff across multiple City agencies and consultant partners. The San Francisco Planning Department recognizes James Pappas, Joshua Switzky, Esmeralda Jardines, David H. García, Diana La, Rachael Tanner, Lisa Chen, Miriam Chion, and Gary Chen for their leadership, analysis, and coordination throughout the development of this study. We also thank our partners at the Mayor’s Office of Housing and Community Development, including Dan Adams, Lydia Ely, Sheila Nickolopoulos, Mara Blitzer, and additional MOHCD staff, for their deep knowledge and contributions to shaping the strategies presented. Appreciation is also extended to Leigh Lutenski and the Office of Economic and Workforce Development for their insight into implementation and alignment with broader economic development goals. Finally, we acknowledge the valuable partnership and technical support of Enterprise Community Partners and Century Urban, whose expertise generated policy and financial research and analysis that informed recommendations that guided this report. AFFORDABLE HOUSING SITES ANALYSIS & STRATEGIES 3 Executive Summary of the Affordable Housing Sites Analysis and Strategies Report October 2025 San Francisco has the tools, sites, and expertise to advance its affordable housing goals, but only with sufficient, consistent financial resources. The AHSAS provides research-based recommendations for managing limited resources while pursuing equity and geographic distribution objectives. Our affordable housing needs demand additional funding, balancing construction of the existing 12,600-unit pipeline with selective new acquisitions, cultivating opportunities on public, master-planned, and community-owned land, and creating pathways for diverse housing types across all neighborhoods. By aligning site acquisition with funding availability, continuing cross-sector partnerships, and pursuing policy and program changes that expand tools to secure sites, San Francisco can build a more sustainable and equitable affordable housing future. San Francisco has a target of facilitating 32,800 additional homes affordable at lower incomes by 2031. This target is part of the City’s Regional Housing Needs Allocation (RHNA) for 2023-2031 from the Housing Element. The Affordable Housing Sites Analysis and Strategies addresses how the city will continue to develop its pipeline of existing affordable housing projects and acquire and develop additional sites for affordable housing. Led by SF Planning in collaboration with the Mayor's Office of Housing and Community Development (MOHCD) focuses on the following areas: • Pipeline -Effectively managing the existing affordable housing development pipeline • Production -Boosting the overall production of affordable housing units • Acquisition -Identifying and acquiring new sites for future affordable housing development The Affordable Housing Sites Analysis and Strategies includes substantial research, stakeholder engagement, and offers strategies based on research findings. • Research covers the current affordable housing development pipeline and the City’s pipeline management practices, identifies viable development sites for affordable housing, and analyzes financial and policy considerations for site acquisitions. Stakeholder engagement with affordable housing developers, community organizations, and other practitioners informed the research and strategies. • Recommended strategies, based on research findings and stakeholder input, address pipeline management, geographic equity, partnership with public and nonprofit landowners, strategic market acquisitions, and expanding diverse housing types to address affordability. AFFORDABLE HOUSING SITES ANALYSIS & STRATEGIES 4 Context and Findings The Central Challenge: Funding San Francisco's primary barrier to building more affordable housing is not lack of developable sites, but insufficient funding and high construction costs. Currently, over 12,600 affordable units across 59 projects are awaiting funding in pre-construction stages of the pipeline. At current production rates of approximately 650 new 100% affordable units annually, building out the existing pipeline could take over ten years. Development costs are now nearly $1 million per two-bedroom unit with construction costs making up more than 60% of development expenses. In 2024 the Affordable Housing Leadership Council, a group of affordable housing leaders and experts, released recommendations on expanding funding and financing for affordable housing and lowering costs. The policymakers and agencies have acted on some recommendations, while others await further action. The Board of Supervisors recently passed a resolution calling on City agencies to assess funding tools for affordable housing including infrastructure finance districts in September 2025. This has advanced civic dialogue about ways to secure affordable housing funding. Pipeline Management and Land Banking MOHCD coordinates with other public agencies and affordable housing developers to provide funding from up to 25 different local funding sources along with state and federal funding to build an affordable housing pipeline of over 12,000 units. Click here for a brief overview of the City’s affordable housing pipeline and related information. The current pipeline includes sites acquired in various ways: • Sites purchased in the private market (2,087 units) or provided by private development agreements (634 units) • Sites on land from public agencies, often as part of large mixed-income developments including development agreements like Treasure Island and Balboa Reservoir (2,320 units), HOPE SF rebuilding of public housing sties (1,415 units), and other public sites (471 units) • Former redevelopment projects funded by OCII (2,494 units) • Rehabilitation/preservation projects (3,195 units) By holding the land for these projects before all the necessary funding is secured, the city has a de facto land banking process. The city acquires and holds sites until projects secure full financing and permits. Land banking, however, incurs holding costs. Managing this portfolio requires balancing long-term obligations with new opportunities while navigating volatile funding sources. AFFORDABLE HOUSING SITES ANALYSIS & STRATEGIES 5 Geographic Distribution and Equity Goals Like market-rate housing, affordable housing production is not equitably or evenly distributed across San Francisco. To meet the Housing Element goal of constructing at 25-50% of all new affordable homes in well-resourced areas, San Francisco will need to shift its present pattern of uneven geographic distribution of affordable housing and housing production in general. • Currently most housing development of all kinds is concentrated in four of 11 supervisorial districts, and the existing Affordable Housing Pipeline is primarily concentrated in Supervisorial Districts 5, 6, 9, and 10, which cover primarily equity communities within the city's eastern neighborhoods. • Meanwhile, Districts 1, 2, 4, 7, 8, and 11 have few or no 100% affordable projects in the pipeline. These districts are where more of the city’s higher resource areas are found. Most affordable housing sites in the pipeline are concentrated outside of San Francisco’s well-resourced Housing Opportunity Areas (HOAs) in the center, west, and north of the city. This pattern continues the exclusion of affordable multifamily housing from HOAs. To meet Housing Element goals and the State’s Affirmatively Furthering Fair Housing (AFFH) requirements, San Francisco will need to develop at least 25% of all new affordable units in HOAs. The proposed Family Zoning Plan rezoning will create capacity for multifamily housing in these historically exclusionary areas, opening pathways for both 100% affordable developments and inclusionary units in mixed-income projects. Parcel Suitability Analysis for Affordable Housing The parcel suitability analysis identified approximately 3,410 viable sites citywide with capacity for roughly 247,000 affordable housing units that meet the City's criteria for 100% affordable housing projects. These sites include 1,204 individual parcels of at least 8,000 square feet (the minimum size requirement for typical subsidized 100% affordable housing) as well as 2,206 contiguous parcels viable through parcel assembly. District 6 shows the greatest capacity, followed by Districts 2, 3, and 9. Site suitability and availability, however, do not guarantee development feasibility. Individual property owners may not be interested in selling or developing due to profitable current uses, low tax basis, or complex ownership structures. The parcel suitability analysis demonstrates that land supply is not the constraining factor on meeting our affordable housing production goals. The proposed Family Zoning Plan was not evaluated in this analysis but will increase the capacity for affordable housing even further by increasing height and density and allowing flexible standards for affordable housing as well as generating funding for affordable housing. Ultimately, advancing our affordable goals depends on acquisition aligned with funding availability for construction.