A crazy letter from a leading local developer, and a poll showing Prop. I leading, demonstrates how worried the industry is about a possible slowdown in luxury condos
By Tim Redmond
AUGUST 25, 2015 – The real-estate developers of San Francisco are worried about the Mission Moratorium. And according to at least one recent poll I’ve heard about, they have grounds for concern.
How worried are they? Well, Joe Eskenazi got a copy of a letter sent by Oz Erickson, a longtime developer, and he’s so freaked out he’s talking about Nazi Germany:
“I am starting to feel a little like Pastor Niemoller in Nazi Germany,” Erickson wrote in an August 15 letter obtained exclusively by San Francisco. “You are all probably familiar with his famous words. ‘First they came for the Socialists, and I did not speak out—because I was not a Socialist. Then they came for the Trade Unionists, and I did not speak out—because I was not a Trade Unionist. Then, they came for the Jews, and I did not speak out—because I was not a Jew. Then, they came for me and there was no one left to speak for me.’”
“Hyperbolic for me to bring up Niemoller,” Erickson acknowledges, “but if we let [Mission District developers] Maximus and Podell go down in flames even if they were in part responsible for the mess, we jeopardize development throughout the city. . . . The mood against construction is getting hysterical.”
Those poor, oppressed real-estate developers. (BTW, Erikson apparently isn’t pals with the Mission district developers, who he thinks are part of the problem. He tells his pals that they need to give money to “correct a mess they had no responsibility in creating.”)
His fear: If the Mission Moratorium passes, next thing you know other neighborhoods will also be asking for planning controls. The next thing you know, the people of San Francisco might start saying they don’t want more of the type of housing that creates more problems than it solves. The next thing you know, we might have another law like the original Prop. K, which would have forced developers to go through a more arduous planning process if the city didn’t hit a 30 percent affordability level.
The next thing you know, the ATM that is high-end residential development in San Francisco might start to close. And that would be just awful for these speculators and investors.
The next thing you know, sites that could be turned into million-dollar condos might be available for the city to buy and use for affordable housing.
So Erickson, who is already helping the mayor raise money for the housing bond, Prop. A (which, he says, developers promised to fund if Sup. Jane Kim would pull back on Prop. K), wants his friends also to pony up to defeat Prop. I, the Mission Moratorium.
He wants Maxiumus and Podell (developer of the Beast on Bryant) to kick in $500,000 each, and everyone else to give “$10 to $20K.”
Problem: Maximus doesn’t really have a project right now, since the land in question in tied up in litigation, and Podell is about to run into a buzz-saw of community opposition when the Bryant St. project comes before the Planning Commission Sept. 10.
So do those developers really want to put half a million dollars each into defeating an 18-month delay – when there’s a good chance neither of their projects will be shovel-ready in 18 months anyway?
Dunno. But here’s why Erickson is so manic about raising money for No on I:
A poll taken shortly before the campaign started shows the concept of a Mission Moratorium ahead, 52-38 – not just in the Mission but citywide, Gabriel Medina, policy director at MEDA and part of the Yes on I campaign, told me.
The poll, done by an eminently reputable local organization, suggests that Prop. I has support in almost every supervisorial district.
There will, of course, be a campaign against it, and the Board of Realtors is taking the lead in that effort. Erickson urges his pals to “get back to Mary Jung about Prop. I.” Jung is the chief lobbyist for the realtors – oh, and by the way, serves as chair of the local Democratic Party.
But the realtors are also involved in the campaign for Julie Christensen in D3, and Mayor Lee is hitting them up for Prop. A. So I don’t know how much money they are going to be able to kick in.
There’s no big money behind the Yes on I campaign; it’s entirely a grassroots effort. And it’s hard to win a citywide campaign when you have a million bucks or so against you.
But Medina told me he’s not seeing any signs of that kind of money flowing yet — and it’s almost September.
Erickson says he has no financial interest here – “my projects are all approved, and either fully leased or under construction with long term fixed-rate financing.” His fear: If Prop. A loses and Prop. I wins, “construction slows down, future development becomes extraordinarily risky, Richmond-style rent control appears on the scene and overall, the city, which I adore, gets unmercifully savaged.”
As if many of the long-term residents of neighborhoods like the Mission don’t think the city, which they adore, is already getting unmercifully savaged. And many of them see Prop. I as a solution.