Dogpatch, Mid-Market, Transbay,
Hayes Valley and the Marina are the
neighborhoods to watch in 2020.
San Francisco, despite the city’s housing crisis and continually growing employment, ended 2019 with less than 250 new condominiums built. 2020, in stark contrast, will deliver over 1,000 new condominiums to a diverse set of neighborhoods. Polaris Pacific expects Dogpatch, Mid-Market, Transbay, Hayes Valley, and the Marina to be the top five hottest neighborhoods to watch in 2020.
The Dogpatch neighborhood, which is situated east of the 280-Freeway and south of Mission Bay, will be one of the hottest neighborhoods for new condominium buyers in 2020. Buyers are attracted to this neighborhood because it offers a unique neighborhood identity, with old Victorian homes sitting alongside new construction lofts, independent restaurants and cafes, and artist studios. The neighborhood is a hub for creative industries: Uber’s Autonomous Driving Division, made-to-order clog store Bryr Studio, and Beats Music (formerly Beats by Dre) are all headquartered in this neighborhood. To be associated with its unique and artistic identity, buyers have proven to pay a premium to live in this neighborhood.
Buyers are also choosing Dogpatch in anticipation of a wave of new development coming within the next decade. Most of this development will be concentrated along the waterfront in two large master planned communities: Pier 70 and the Potrero Power Station. Pier 70 is a 69-acre master plan developed by Brookfield Properties. According to the San Francisco Chronicle, the development will contain over 1 million square feet of commercial space, over 2,000 new housing units, 360,000 square feet of retail, and an arts and light industrial space (including a maker’s hall).
The waterfront parks planned for Pier 70 will be equally compelling. Planned in partnership with James Corner Field Operations—who led the design construction of New York City’s world-famous High Line—it will feature public art, terraced lawns, meadow plantings and promenades that jut out into the water.
The Potrero Power Station site, a 28-acre site along Pier 70’s southern border, is currently working its way through the entitlement process. Developed by Associate Capital, the development, according to the San Francisco Business Times, intends to build over 2,500 homes, over 1 million square feet of office and research and development space, 100,000 square feet of retail, a 200-room hotel and 6 acres of parks and open space. Buyers who are purchasing in this neighborhood anticipate it will be radically different, and significantly more expensive, in the future.
Buyers are also choosing Dogpatch due to its strategic location. The neighborhood provides direct access to the 280-freeway; the future Central Subway, with service to Chinatown and Third Street Light Rail; and 22nd Street Caltrain station, a key asset for anyone looking to commute to Silicon Valley. During rush hour, the 22nd Street Caltrain stop offers bullet trains that reach Redwood City in under 30 minutes and Palo Alto in under 45 minutes. (Compared to automobile rush hour commutes of over an hour to an hour and a half, respectively.) With the recent completion of Chase Stadium, and Uber and Dropbox’s move to Mission Bay in 2020, Dogpatch will command an even more strategic location: commute times to the South Bay will be even longer and Dogpatch will be viewed as the best neighborhood from which to commute to Silicon Valley.
Given all the positive attributes of Dogpatch, two exciting new communities that are expected to receive a lot of attention in 2020 are 2177 Third Street and 950 Tennessee. 2177 Third Street is a six-story, 114-residence condominium building at the corner of 19th and Third Streets. Developed by Align Real Estate and designed by Woods Bagot, the development contains luxury interiors and compelling views of the bay. 950 Tennessee is a 100-residence condominium building by LEAP Development and designed by Handel Architects situated on Tennessee Street, just south of 20th Street.
The Mid-Market neighborhood stretches along Market Street from the Westfield Mall at 5th Street to Van Ness Avenue. Despite its glamorous past, the neighborhood went into decline starting with construction of BART in the 1960's. The first wave of the neighborhood’s renaissance began with the payroll tax exemption in 2011. This piece of legislation brought a wave of major office tenants, such as Twitter, Square, and Uber to the neighborhood starting in 2012. By 2014, over 10,000 employees were occupying approximately 3.0 million square feet of re-positioned office space in the neighborhood. At the same time, a host of brand new, large-scale apartments were constructed. Collectively, this brought over 2,000 new apartments to the neighborhood between the years 2012 through 2014. Since that time, the neighborhood has seen continuous development, with the opening of new hotels (the Proper Hotel in 2017 and the Yotel in 2019) and an additional 700 new apartments delivered between the years 2015 through 2018.
The neighborhood is poised for further transformation over the coming years. According to Curbed SF, plans are in the works to transform Civic Center Plaza, United Nations Plaza, and the block of Fulton Street that connects these two green-spaces. Current plans call for transforming these areas by shutting off a portion of Fulton Street to car traffic, adding more neighborhood parks and dog parks, and adding a new community center and market hall. Also, in October 2019, SFMTA voted unanimously to shut down large portions of Market Street to private vehicles. According to the San Francisco Chronicle, the plan, which is expected to start construction in January 2020, is to widen sidewalks and add sidewalk-level bike paths with protective curbs.
All these changes that have occurred in Mid-Market over the past decade, coupled with all plans to further transform the neighborhood in the coming years, make this a compelling neighborhood for new condominium buyers. These buyers will also be motivated to live in the neighborhood, since it houses two BART stations and three MUNI/light-rail stations and is walking distance to the job centers in the Financial District and South of Market neighborhoods. Of note, the Serif, a 242-residence condominium building, is set to open in 2020. Developed by L37 and designed by Handel Architects, the development will also include an adjoining 236-room LINE Hotel, a boutique hotel brand that has gained a cult following for their design-forward hotels, culinary delicacies, and nightlife offerings.
The Transbay District covers a 20-block area bounded by Mission Street to the west, Main Street to the north, Folsom Street to the east and Second Street to the south. It is the city’s densest neighborhood and the most transit-rich, with ferry stations, MUNI/BART stops, and hundreds of bus lines within walking distance. The centerpiece of this neighborhood is the Transbay Transit Center, a regional transportation hub that serves as the termination point for nine different local and regional transit bus lines. Sitting atop this center is Salesforce Park, a 5.4-acre public green-space, which runs the entire length of the Transit Center’s nearly four-block stretch. Adjoining the park is Salesforce Tower, a 1 million-square-foot office building developed by Boston Properties completed in 2018 and the global headquarters for Salesforce. To help pay for the Salesforce Transit Center and rooftop park, a series of former parking lots owned by the Transbay Joint Powers Authority were sold to private developers to build brand new office towers and residential buildings, designed by a host of starchitects from Rem Koolhaas to Jeanne Gang. According to the San Francisco Business Times, these buildings will eventually result in over 7,000 new residents and 6 million square feet of office space in the neighborhood.
Buyers are drawn to this neighborhood for its endless array of transit options, ability to walk to work, and live in amenity-rich, high-rise buildings. One exciting project to enter the neighborhood in 2020 will be One Steuart Lane. Developed by Paramount Group and SRE Group, this ultra-luxury offering, situated at Howard Street and the Embarcadero, will offer 120 boutique condominiums. Given its location along the waterfront, most homes will offer unobstructed views of the bay and the Embarcadero. Just as One Steuart Lane will be entering the market in 2020, Mira, another architecturally stunning condominium, will be completing construction. Designed by Jeanne Gang, a world-famous architect and named to Time’s Top 100 in 2019, and developed by Tishman Speyer, one of the largest developers in the world, the 40-story building features a twisting facade, making it a unique and compelling new addition to the city’s skyline and waterfront.
Hayes Valley is a neighborhood bordered by the Van Ness Avenue performing-arts district and the Western Addition around Laguna Street. Formerly bisected by a double-decker freeway, which was removed after incurring extensive damage during the 1989 Loma Prieta earthquake, the neighborhood’s renaissance began after its removal. According to the San Francisco Chronicle, “where the crack houses and tenements once stood, now there are trendy fashion boutiques, SoHo-style funky art galleries, high-end interior-decorating shops, top-notch restaurants and hip nightspots.” The neighborhood’s main retail boulevard, Hayes Street, is home to some of the city’s cutting-edge fashion brands and often the first place Direct to Consumer (DTC) internet brands go to open their first brick-and-mortar store.
Hayes Valley buyers want to be within walking distance of an endless number of hip bars, stores, and restaurants, proximity to transit, and the endless live entertainment options. Despite their strong desire to live in this neighborhood, very few new condominium options exist. Fortunately, one exciting community will open in this neighborhood in 2020: 950 Gough, an eight-story condominium building developed by Maracor Properties/Westbrook Partners at the corner of Gough and Eddy Streets and designed by Handel Architects.
The Marina/Cow Hollow
While the other hot neighborhoods featured have only become popular in the last decade or two, the Marina has been established for over a century. The neighborhood traces its origins to 1915 when San Francisco was chosen to host the World’s Fair. The city expanded west on landfill to create the neighborhood. To this day, The Marina remains one of San Francisco’s most desirable places to live, work, and explore.
One of the Marina’s most prized amenities is the Marina Green, which affords stellar views of the Golden Gate Bridge and Alcatraz and miles of protected bike lanes and walking paths. The neighborhood’s two commercial streets, Union Street and Chestnut Street, house some of the city’s most trendy restaurants and bars, boutique fitness studios and boutique clothing brands.
Despite all the positive attributes of living in The Marina, there’s a scarcity of available development opportunities, resulting in minimal to no new condominiums entering this part of the city in any given year. This will make Union House, a six-story condominium development situated at the intersection of Van Ness Avenue and Union Street opening for sale in early 2020, such an enticing offering. Developed by DM Development and designed by Handel Architects, the project will include 41 residences, most which will include city, bay and Golden Gate Bridge views. Many of the homes will feature generous private outdoor areas and all residences will have access to an expansive rooftop deck.
San Francisco will bring a host of new and exciting condominium communities to the market in 2020 within very diverse and distinct neighborhoods. While each community will appeal to a variety of groups, ranging from baby boomers looking to downsize to millennials looking to purchase their first home, all of the offerings share some common threads: the new condominiums are in transit-rich, mixed-use neighborhoods. This will allow residents to live, work, and play in the same neighborhood, an invaluable amenity in the Bay Area where commute times have grown exponentially longer over the past decade.
Miles Garber is the vice president of research at Polaris Pacific, the largest brokerage firm of new condominiums on the West Coast. He runs the research consulting division and oversees the Polaris Pacific Report, a monthly market intelligence report that tracks sales prices and absorption rates of new residential condominiums.