If you've ever driven along the El Camino Real from San Francisco to San Jose, you’ve probably noticed the seemingly endless stretch of parking lots and strip malls that line the entire route. Well, get this—apparently there’s room for an estimated 250,000 new apartments along this road. Developers are trying to figure out how to make this happen as an attempt to alleviate the housing shortage.
Now let's be real, everyone loves a good strip mall. Where else can you do your grocery shopping, get a haircut, and pick up a burrito for lunch all in the same afternoon? So the goal here wouldn’t be to tear down every strip mall completely. Instead they suggest creating mixed-use buildings that would keep retail space on the ground level while adding apartments on top.
California reportedly needs to build millions of new housing units to meet current demand. Governor Newsom pledged to build 3.5 million homes by 2025, but so far only around 100,000 homes are being built each year. Strip mall development might be a solid solution.
Under a new measure approved by Governor Gavin Newsom, local governments, affordable housing groups, and tenants will get first dibs in buying foreclosed homes. The bill was written to prevent large corporations from buying up houses and letting some of them remain untouched for years as they did during the Great Recession. Simply put: this measure is meant to give people who want to buy a home a fair chance at doing so, which we are all for!
Newsom also signed several other bills which included increased subsidies for affordable housing projects, allowance of school districts to use tax credits to build affordable housing for teachers and staff, and the expansion of a bill that allows victims of crime to break their leases without penalty.
BART has now approved a development project at the West Oakland Station that will include 762 housing units (!!!) with more than 30% of units being marked specifically for affordable housing. The development will also include more than 50,000 square feet of retail space and 300,000 square feet of office space, along with additional crosswalks and wide sidewalks for pedestrian access, perfect for getting those Fitbit steps in. The hope is that this project will be transformative for West Oakland, providing much needed housing that is more easily accessible to neighborhood amenities and resources.
The average U.S. home costs $240,000. But in San Francisco, a two-bedroom apartment costs around $750,000 to build. The costs of construction in SF are 13% higher than New York, 60% more expensive than Chicago, and 75% more than in Houston. But why is it SO expensive?
For starters, the price of land and labor in California is insanely higher than other states. In SF, a construction worker makes about $90 an hour. (Did you just audibly gasp because you had no idea this was a construction worker's average wage and consider maybe you too could work in construction someday? Because same).
But it’s not just that. There are so many costs that go into building affordable housing. Government fees, permits, hiring consulting companies.... So. Many. Things. It literally took the City Council 6 months just to agree on the financing paperwork alone. More attorneys are involved in projects than actual construction workers. And we wonder why it takes SO long to get any sort of traction on building affordable housing (or any housing at all) in the city. *Insert crying face emoji here.*
Ever since leading tech companies Amazon, Apple, Facebook and Google all landed on the West Siiiide (did you say that in your best Tupac voice?), affordable housing has been nearly impossible to find. Recently these companies vowed to find solutions to this issue in their local communities. But are their efforts enough? Some say nah.
Despite the billions of dollars they've pledged and initiatives they've started (Amazon literally opened a homeless shelter on their downtown campus), many folks feel that it might be too little too late. With homelessness rising and diversity dwindling in these communities, a lot of people believe that the money being thrown at the problem just isn't enough. Is there a better solution? That’s yet to be seen. But hey, this is a start.
All things real estate.