Two major housing projects are moving forward in SF, including the conversion of the former Market Street Nordstrom Rack into 136 units and JPMorgan-backed plans to build 342 units at the former Potrero Power Station.
Two major San Francisco housing projects are moving ahead as the city looks to add new homes through both commercial conversions and private investment, as KTVU reports. Mayor Daniel Lurie announced plans Monday to convert the former Nordstrom Rack building at 901 Market Street into 136 housing units. It’s reportedly the first of four commercial-to-residential conversions the city is pursuing, along with former office buildings in Hayes Valley, Union Square, and Pier 39.
The Market Street project will preserve the building’s historic facades along Market, Fifth and Stevenson streets while transforming the upper floors into a mix of studios, one-bedroom and two-bedroom apartments, per KTVU. The retail spaces on the ground and lower levels will remain, and the building’s existing indoor atrium will be redesigned into an open-air courtyard.
The city has not yet released details about how many affordable units are planned for the site. Residents who welcomed the addition of housing also raised concerns about whether new development would address affordability challenges facing many residents.
Meanwhile, the housing push received a major private-sector boost with JPMorgan Chase announcing a $200 million investment that includes financing for 342 new homes at the Potrero Power Station redevelopment on SF’s Central Waterfront in the Dogpatch. According to the Chronicle, the bank's investment signals a potential shift in the city’s difficult housing market. While many lenders remain cautious, developers say JPMorgan’s backing shows some major investors are becoming more willing to fund workforce housing projects.
JPMorgan also funded the recently completed Sophie Maxwell Building, a 105-unit, workforce housing project consisting of 100% below market-rate units, which is also located at the former power station site.
Enrique Landa, managing principal at Fifth Space, the developer of the Dogpatch project, told the Chronicle that the financing challenges facing so-called “missing middle” housing — homes intended for residents who earn too much to qualify for traditional affordable housing but not enough to comfortably afford market-rate units — required a new approach. This prompted the company to the create the Essential Housing Fund, a private investment vehicle aimed at financing workforce housing across San Francisco.
The Chronicle reports that the effort grew after a $50 million investment from Crankstart Foundation founder Michael Moritz, who challenged the group to build 1,000 units over five years, and the fund also received commitments from JPMorgan Chase and the Whitman-Harsh family. Fifth Space has identified roughly 750 stalled housing units across the city that could potentially move forward with new financing and aims to launch the first project next year, followed by two in 2028.
The bank also announced Monday a national commitment to invest in housing supply, including financing for affordable housing projects across the country, according to a separate Chronicle article.
Housing advocates note that while the investment is welcomed, private funding alone will not solve San Francisco’s affordability crisis. They say city leaders must continue pursuing policies that allow more homes to be built.
Related: SF Supes Reduce Affordable Housing Requirement as Costs Continue to Stall New Construction
