A 16-story, 270-bedroom tower catering to both market-rate and below-market tenants is starting construction at 457 Minna Street after developer Starcity has secured funding for the ambitious project.
As the Chronicle tells us, each of the upper 15 floors of Starcity's development will have 18 single-bed units along with a central kitchen and common area on each floor. And units in the glass and concrete building will be split half and half between market-rate units (renting for $2,000 to $2,400 per month), and BMR units (renting for $800 to $1000 per month).
Starcity already has three smaller so-called "co-living" buildings in the city — a six-unit building in SoMa, a 12-bed building in North Beach, and a 20-bed building in the Mission.
What we used to refer to as "hacker hostels" or "tech dorms" in the earlier years of this decade haven't all panned out to be so tech-y after all — given that many people employed at startups and large tech firms can afford regular shared apartments, if not their own studios and one-bedrooms.
Starcity says that the average tenant in these properties earns $75,000 a year, and less than 30 percent of them work in tech. Most are in education, food service, and other lower-wage industries. The average age of these tenants is 33.
Interestingly, one of the players in this "co-living" space who started renting out similar properties six years ago, entrepreneur/developer Danny Haber, tells the Chronicle that he's gotten out of the business altogether. "Co-living is a bad business model," Haber says, adding that there was far too much turnover among the tenants to make the business feasible — with most tenants staying for about six months before wanting to move. Haber had launched a series of these "intentional communities" in and around SoMa under the name The Negev, catching some bad press and city scrutiny along the way.
These days, according to Starcity, lenders are lining up to fund projects like these, whereas in years past they shied away.
Local "micro-unit" developer Patrick Kennedy, who rents out similar but different units that all have their own burners and microwaves inside, suggests that the purely communal model doesn't work for everyone. Speaking to the Chronicle, he says, "We are builders and developers, not cruise ship directors or party planners," referring to the complications involved with all that co-habitation. Still, his tenants do share kitchens, but they "can make a cup of coffee without having to go out in your bathrobe and greet [their] neighbors."