Crime San Francisco also innovates in real estate

22:17  12 april  2021
22:17  12 april  2021 Source:   challenges.fr

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24684_1462959_k2_k1_3380159.jpg © Mr. René / Hemis.fr 24684_1462959_K2_K1_338015.jpg In California, the construction standards make Flamber the invoice of the promoters, who redouble creativity to reduce the costs of social housing. San Francisco also innovates in real estate

Americas © The Economist

Here is an example that could make emulators: the new building of 146 apartments being completed at 833 Bryant Street, in San Francisco, is dedicated to housing for ancient SDF. With a lower final amount of about 25%, its realization has been relatively inexpensive. But it is also a real feat in California, where the construction costs of social housing have been exploding for twenty years.

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To achieve public aid, promoters may, indeed, be imposed facilities (solar panels, balconies extensions) or to have the local small businesses work, which can boost the construction costs. While at the same time the sector had to face an increase in commodity prices and a labor shortage that climbed salaries, including those of skilled workers. To do not arrange, the local licensing mechanism of building permits also contributes to the invoice. Any new project may be challenged under the California Environ-Mental Quality Act (CEQA), a 1970 text often invoked by local associations to block a project. And, cherry on the cake, like California capped real estate taxes, some cities funding by demanding promoters an "impact tax" that can exceed $ 150,000 per apartment.

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In order to limit the final addition, developers of 833 Bryant Street have tabulated both on technological tricks and innovative governance: choice of a prefabricated modular habitat and obtaining the building permit as part of Senate Bill 35, which protects the project against the protest procedures permitted by the CEQA.

While California is lacking more than 3.5 million homes, according to McKinsey's firm, the idea of ​​relaxing construction standards for social housing is making its way in the region. Thus, Berkeley, a nearby town of San Francisco, has just repealed the prohibition of building more than one plot. His assistant mayor, Lori Droste hopes that the new constructions thus made possible will lower the price of housing. So, San Francisco could quickly adopt the same rules.

Although tech employees tend to leave the San Francisco region, the Bay Area authorities believe that there will be approximately 55,000 new housing per year to satisfy the demand. In 2020, San Francisco completed only 4,000. The 146 apartments of 833 Bryant Street, however, demonstrate that it is possible to build more, and cheaper.

© The Economist - London 2021

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