A multi-unit building that's become a cause célèbre for pro-housing activists after loud pushback from neighbors over its height and sunlight concerns may revert back to its original design, after state housing officials stepped in to scold the SF Planning Commission and Board of Supervisors over a compromise plan.

A proposed 19-unit micro-housing development on 18th Street at the edge of the Castro neighborhood has been the focus of much drama between YIMBY activists and NIMBY neighbors. The development at 3832 18th Street (between Church and Sanchez) would replace a single-family home, and it was initially proposed as a six-story structure, taking advantage of the state's density-bonus law to add two extra stories to the zoned height limit for the area.

In April 2022, after pushback from neighbors, the SF Board of Supervisors signed off on a five-story compromise plan that contained the same number of studio units — 19 — but eliminated some common spaces and amenities to come in one story shorter. Supervisor Rafael Mandelman reportedly helped broker the compromise, after neighbors decried the potential loss of sunlight from the multi-unit building.

It should be noted that the proposed building would sit next to an existing, fairly unattractive, five-story senior housing complex that was built in the 1970s that is a much larger presence on the block than any of the Victorian and Edwardian homes surrounding it.

The Google Street View image of project site at far right, and the existing five-story senior complex at left.

"It’s tearing down a single family home for six stories of efficiency apartments in a high-demand area a block from Dolores Park,” says YIMBY Law founder Sonja Trauss, speaking to the Chronicle. "[The city] felt like its job was to force a compromise rather than say, 'Well, it’s a code compliant project and we are in a housing shortage, so we can’t help you. Count your blessings and move on.'"

Now, as the Chronicle reports, the California Department of Housing and Community Development (HCD) has sent a letter to the SF Planning Department saying that the compromise violated the state's density-bonus law, and that the developer had been fully compliant in proposing the six-story version of the structure. And, even though the five-story version contained the same number of units, it lost 15 bike-parking spaces, a communal kitchen, and a community room in doing so.

"A local agency is not permitted to apply any development standard that physically precludes the construction of a qualifying density bonus project at its permitted density," says HCD's assistant deputy director of local government relations and accountability David Zisser in the letter, per the Chronicle.

The Planning Department says it will respond within 30 days to the letter, which was dated December 29. And the result may "entail reconsideration by the [Planning] commission of the original project," as Planning Director Rich Hillis tells the Chronicle.

This is a win for YIMBY activists and another example of the state stepping in, as it has several times in recent months, to scold San Francisco officials over policy decisions that have limited the development of new housing. The unhappy neighbors will no doubt argue that no actual housing was lost in this compromise, but clearly there's a principle at stake here.

The state has continued to pressure San Francisco and other municipalities to rezone and rethink their city plans in order to address the ongoing housing and affordability crisis in California.

Last August, HCD announced it was undertaking an unprecedented "Housing Policy and Practice Review" of San Francisco and its agencies.

"According to San Francisco’s self-reported data," HCD said at the time, "[the city] has the longest timelines in the state for advancing housing projects to construction, among the highest housing and construction costs, and the [Housing Accountability Unit] has received more complaints about San Francisco than any other local jurisdiction in the state."

There is also ongoing drama over the city's Housing Element, and an ambitious state mandate for new housing approvals in the next eight years. As of early December, San Francisco's draft Housing Element — which has a January 31 deadline for submittal to the state — was still 22,000 units shy of an 82,000-unit goal by the year 2031.

Related: This Winter and Spring Could Be a Chaotic Free-for-All For Developers If SF Can't Get Its Housing Element Approved

Rendering via SIA Consulting