A friend and I recently explored an old waterfront industrial zone here in San Francisco. First we poked around on our own as urban adventurers trying to access the city’s forgotten fringes. There were polite interactions with private security along the way. Then we returned a week later to attend a community engagement event organized by the group that’s transforming the 29 acre site into a mixed use neighborhood. The project is being called The Power Station.
The meet-and-greet presentation started with free pizza served out of a custom shipping container food truck. Hipster deluxe. Beer and wine were on offer at no charge. All sorts of people were milling about chatting and schmoozing. Members of the development team were on hand to answer questions. They were a cavalcade of Ivy League university degrees on a charm offensive. And they were, in fact, exceptionally bright and charming.
The presentation described the industrial history of the site which included a gun powder factory from 1854, an ironworks and shipbuilding facility from 1880, a sugar refinery from 1881, giant oil and gas tanks, and two power plants (one from 1889 the other from 1964) along with other associated buildings and businesses.
The plan is to construct thousands of apartments, offices, research labs, a hotel, and retail venues along a network of public parks and a new blue-greenway waterfront promenade. A third of the housing will be designated as affordable, workforce, and low income. Each housing type has its own legal definition and financial parameters. Structured parking, public transit, and alternative mobility options will be integrated into the design.
Then came the exciting part. After signing liability waivers we were escorted to the top of the old power station for an elevated sunset tour. More booze, pizza, and goodies from local vendors were handed out. Similar tours are available periodically if anyone in the area is interested. Free gratis. Beats the pants off the usual tourist traps.
The power station is slated be become a luxury hotel that celebrates the original structure’s industrial heritage. I suspect it will riff off New York’s High Line and Germany’s reinvention of its heavy industrial landscape. The old smokestack will serve as a neighborhood icon like an obelisk.
The site is heavily contaminated by a long list of dangerous substances so before construction can begin remediation and mitigation needs to take place. Much of it is already complete. Other efforts are still underway. The land was given to the developer by the city for “free” with the stipulation that the environmental clean up was to be provided by the company as part of the deal. The affordable housing components were also required in the land transfer.
Massive infrastructure upgrades capable of supporting such intense new development is also part of the larger deal. Water, sewer, roads, light rail, public parks, and so on all must be paid for. This isn’t just million dollar stuff. I did a quick back-of-an-envelope calculation and this will be a billion+ dollar project when complete. All those costs have to be rolled over to the finished market rate components once they come on line. People who are outraged at $1.2M studio condos or $5,400 per month rental apartments need to understand that no one would ever pay to build these places if that outlay didn’t provide a return on investment.
For those who would prefer to see more suburban style fully detached single family homes with front lawns and back gardens “suitable for families” – how many such homes would fit on a 29 acre site? And how much would each have to cost? The alternative is having a toxic wasteland sit fallow for several more decades. No new housing. No tax revenue. No nothing.
If I have any problem with this project (and really, I don’t) it’s that it represents a shift from primary production to a consumptive landscape. Dirty as it may have been, San Francisco used to make real things. It doesn’t anymore. The value added service and tech economy that has concentrated here has the distinct disadvantage of being exceptionally vulnerable. We’re at the end of a long intertwined collection of tethers and just-in-time supply chains that wrap around the planet. We’re terribly susceptible to disruptions caused by the very complexity and abstractions we’re helping to create.
And while a portion of this site is solid rock the rest is spongy fill waiting to liquify in the next earthquake. That doesn’t matter at the moment. But eventually it’s going to become someone’s problem to manage. Who exactly absorbs the cost of a billion dollar neighborhood when it fails? Sooner or later we’ll all find out.