This afternoon, we could know the name of San Francisco’s new mayor. Whoever takes the oath of office in January, they will face intense pressure to reinvigorate housing.
If it’s Daniel Lurie, the current front-runner, San Francisco will have an untested chief executive. He has never held public office, and his only housing experience was a 100 percent affordable project developed by his nonprofit.
If it’s a re-elected Mayor London Breed or Sup. Aaron Peskin, the next administration will be deeply familiar with San Francisco’s housing crisis.
We detailed the platforms of all five major candidates last month. Levi’s heir Lurie and Breed offered similar proposals to increase supply by paring back SF’s longest-in-the-nation approval process.
(Candidate Mark Farrell also promised to cut red tape, but trailing badly on Election Night, he all but conceded.)
During the campaign, Lurie boasted that the one housing project he has guided was cheaper to build than any other affordable housing in the city. But the circumstances – going without public funding and using modular construction – will make the model difficult to reproduce at scale.
Among Lurie’s housing ideas is a “shot clock” on new proposals: a maximum number of days that departments like SF Planning and Building Inspection can spend evaluating a plan. Right now that process can take hundreds of days.
A Lurie spokesperson tells The Frisc that the timer could be set to 90 days or so, but advisors are still evaluating the best figure.
In emailed comments to The Frisc in June, Lurie pledged to “produce more affordable housing, help small “mom and pop” landlords, and catch up on the decades-long under-build of new homes.”
Whether it’s Lurie or someone else, the new mayor will immediately face four major issues to determine if campaign promises can deliver a denser, more affordable San Francisco.
The massive quota
Every eight years, California issues every city an order to make a future housing plan, called the Housing Element, based on population.
SF’s Housing Element for the current cycle, which runs through 2031, plans for 82,000 new units. Nearly 47,000 of them should be below market-rate and affordable at various income levels.
Even if you’re a believer in unfettered development, it’s a stretch goal. On an annual basis, about 10,000 homes a year, it’s more housing than SF has built, possibly ever.
The high-water mark during the Breed administration was a boom year: 4,698 new homes in 2019, according to SF Planning data. A slower economy also slows production, and recent progress has been dismal: In 2023, the city gained only 2,595 homes, 971 of them affordable; in 2022, it was 2,807 homes, 1,205 of them affordable.
SF does have tens of thousands of units approved in the housing pipeline, but many will take years or even decades to manifest. Much of the pipeline is bound up in huge projects that roll out over decades and, like the Hunters Point Shipyard and Parkmerced, can be subject to delays.
The good news is that, under the state mandate, SF need only plan to build these tens of thousands of units. It’s like a restaurant that gets good reviews if its kitchen is well stocked and organized. “The plan must be designed to achieve the overall housing target; the key ingredient here is the city’s commitment to reasonably account for sites’ likelihood of development,” says UC Davis land use professor Chris Elmendorf.
In other words, SF must show state regulators it has set the table for a lot more housing. Making it happen is the hard part. And there’s tremendous pressure to do so.
The state is watching
The new mayor and board take over in January 2025, which leaves six years in the current planning cycle. But intense pressure from California housing regulators means the city has in fact less than six years to show results.
State Sen. Scott Wiener’s SB 423 bill demands cities “check in” with the state halfway through their planning cycles to make sure they’re on course. But the bill singled out SF for annual check-ins.
The city failed its first audit and SB 423 provisions took effect this summer: many new developments can now proceed on a much faster timeline.
So far, developers have submitted 17 projects under the new fast-track rules, including a redevelopment of an historic property on Market Street and a skinny tower on Sutter Street.
Another check-in is due next year, and SF will have to show that we’re producing enough affordable homes each year to hit that 47,000 unit goal by 2032.
Something similar is still lurking over the horizon. When city planners wrote the current Housing Element in 2022, they added a so-called circuit breaker to reset the process. It’s a city law, but crafted under state pressure. If the city hasn’t issued building permits for at least 29,049 new units by January 31, 2027, it must take more drastic measures – rezone, streamline, and deregulate construction – to speed up new housing. As the SB 423 trigger this summer showed, state intervention is no idle threat.
“I haven’t read everyone else’s Housing Element, but I believe we’re unique in this regard,” says SF Planning director Rich Hills tells The Frisc.
Exact measures aren’t spelled out. But Hillis notes that state regulators are watching closely “so that we move forward in good faith [and] not just rezoning in name only.”
All the while, state laws have forced SF to rewrite its design standards and cut red tape, all to ease the path for development. Past design standards required specific rules, such as how far a building is set back from the curb. But they also included vaguer standards like “character” and aesthetics.
No longer: The state wants to end these subjective rules that are easy to wield and delay or block development. If city planners don’t write new standards to the state’s liking, regulators could take over.
The new map
Under Breed, SF planners spent most of 2023 redrawing the city’s limits on building height and density. A final map came out in January, reshaping entire blocks, especially along transit corridors such as Van Ness Avenue and 19th Avenue.
But then Breed, facing growing competition for re-election, made planners literally go back to the drawing board in April. They scaled back soaring plans along some streets. A new map hasn’t yet emerged, but we can expect some blocks to top out at a more modest six to eight stories instead of 14 to 18 stories. Lurie’s housing platform calls for a similar midrise scale.
State auditors have set a deadline of January 2026 to produce a new map. It will need Board of Supervisors approval as well as the mayor’s signature, which brings up an interesting election twist.
The board that convenes in January will not include Aaron Peskin and Hillary Ronen, reliable density skeptics. Their seats plus four more are up for grabs right now. As of this writing, we don’t yet know the winners. But if current tallies hold – a very big if – the board would have a larger pro-density majority than it does now.
So if the next mayor is either Lurie or Breed (again, only based on current tallies), they could have less housing friction with the board.
That doesn’t mean housing politics will be friction-free. If the economy and other factors conspire, as in recent years, to choke off nearly all new housing, San Francisco could draw an ambitious new map for 2026 then – thanks to the circuit breaker – upzone all over again in 2027. And five of 11 supervisor seats will be part of the November 2026 election.
Economic recovery
The Breed administration has fallen short of its housing goals, but at least in part the mayor can point to factors outside her control: the COVID-19 pandemic ground the economy to a halt.
With SF’s reliance on tourism, conventions, and tech, the city’s recovery is one of the nation’s most sluggish. SF is banking on downtown offices to refill, but work-from-home remains a tug of war between companies and employees.
“The office market is in the process of adjusting to work-from-home, which is a moving target itself, and at this point it isn’t clear how much space will be reabsorbed as rents fall,” SF City Economist Ted Egan tells The Frisc.
Offices account for a huge chunk of our tax base. Homes are not as lucrative. Property owners know this too, so holding out for an office return still makes more financial sense than converting those empty spaces into homes.
The squeeze on SF’s coffers affects homebuilding too. The more market-rate homes are built, the more those developers either include affordable homes on site or pay into the city’s affordable housing fund.
That fund itself is limited. Construction of affordable homes is still expensive. The $300 million bond voters approved in March will likely produce a few hundred units, and they will take years to emerge.
Many macroeconomic factors are outside the city’s direct influence. The market-based approach in Lurie’s platform seeks to encourage new construction by cutting down on administrative costs, but the new administration will still have to wait for builders to rise to the occasion.
There were glimmers of hope that a Democratic White House would be aggressive with economic incentives to spur home building in places like downtown San Francisco. Those glimmers were extinguished on Election Night.
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