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"100% affordable" doesn't just mean "less expensive": it has legal significance. It means that it costs a household with 55% to 60% of area median income at mos
by enf 10y ago
"100% affordable" doesn't just mean "less expensive": it has legal significance. It means that it costs a household with 55% to 60% of area median income at most 30% of their income. There is a table of the allowable rents at http://sfmohcd.org/inclusionary-housing-bmr-rental-program-overview http://sfmohcd.org/inclusionary-housing-bmr-rental-program-o.... If you want to build a studio to rent at cost for $1070 a month, you need to be able to build it for around $230,000, which is basically unimaginable with current SF land and construction costs.
- akiselev 10y agoWho builds a single studio in San Francisco? You'd build a hundred studios on 10 floors or something which means a maximum of $23 million. The land is a fixed expense since you're still buying x acres for the building and a lot of the costs going into planning and construction (permits, procurement, transportation, labor, etc) have large fixed costs but much smaller marginal costs and great efficiencies of scale. I don't know the cost per sq ft of the average project in SF but at 800 per studio (500 sq ft of space plus 300 for estimating overhead) you can spend almost $300 per sq ft. Assuming that number drops to 650 sq ft if you build a thousand studios you can now spend closer to $400 per sq ft which is in the realm of mid-2000s construction costs in Manhattan [1]. I'm pulling numbers out of my ass for the estimate but it should be clear how the math can still work out for developers. [1] http://therealdeal.com/issues_articles/nycs-construction-craze/ http://therealdeal.com/issues_articles/nycs-construction-cra...