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The $900 is one of the "affordable" units. The market rate hasn't been set yet, from what I think. Maybe determined once they go out on the market...
Also, FWIW, long story, but about a year ago we looked at and applied to apartments in both Manhattan and in San Francisco (NYC first, then SF immediately after the NYC transfer fell through) and we discovered that it was actually cheaper in Manhattan. The rental market had gone crazy in SF.
These mini-units actually hark back to the longtime San Francisco tradition of people living in residential hotels. People nowadays tend to think of residential hotels as only being for the poor and homeless. But historically (different) residential hotels were rented to everyone from the affluent to the very poor. San Francisco used to have a transient workforce of longshoremen, loggers in for the winter etc. Now there's a transient workforce of tech workers. Residential hotels obviously exist elsewhere, San Francisco just had an unusually high proportion of hotel residents. Paul Groth's Living Downtown gives the whole history.
This is what I mean. If a micro-apartment in Manhattan can go for (a median of) $950 in rent, why wouldn't SF be able to do the same? Are the housing codes that different? I can't see paying $12-1500 for what is essentially a closet when I could get a studio for comparable cost.
Because the San Francisco one's don't have whatever millions of public dollars is used to make the NYC ones "affordable." That's why I call them afforded by someone else units. Sure, they're cheap enough when some and likely most of the cost is being picked up by the tax payer, but what is the full cost? That's unknown. The proposed San Francisco units are market-rate and proposed to be built without tens of millions of dollars of public funds, so they have to set prices that reflect the cost of building the units and a reasonable return. Apparently that's $1200-1500 per 220 square foot apartment, which seems like rather a lot to me for what you get. The NYC apartments, at least the "affordable" units, set prices determined by what a government formula allows them to charge. In exchange for charging these "affordable prices" the government kicks in however much it kicks in.
Again, I don't know the particulars. In Sacramento, and indeed all of California, these projects are pretty dubious. For example, Sacramento spent $100,000 per SRO hotel room to renovate a historic building that was full of renters (most of whom were on disability or some other form of aid). They kicked out all the tenants, spent three years redecorating and doing a seismic overhaul, and then put the units (minus three) back on the market as "affordable" housing at higher prices than before with income requirements high enough that most of the former tenants couldn't come back even if they wanted and were able to pay the higher rents. Another example is the J lofts where affordable housing funding was used in position of what typically banks require developer equity. In exchange for making 20 or 25% of the units "affordable," the developer basically builds a risk-free building. Without any risk, overly ambitious projects get built, and now with Redevelopment being dissolved, the liability is on the cities. J Lofts seems to be doing okay, although rents have come down significantly off what they were initially. That's not always the case. The debts from ambitious public-private projects have been the sole cause of a few cities declaring bankruptcy. In other cases, such as where I live currently, the dumping of millions and millions of dollars of liability have contributed, along with other extremely poor fiscal decisions, to bankruptcy. Right now Sacramento is teeter-tottering on $2 billion in unfunded liabilities from a combination of the promising generous pensions without ever bothering to consider a revenue source to pay for them and the debt from public projects many of which were built during the bubble and worth a fraction of what is owed on them. All said and done, Redevelopment dumped $300 billion in liabilities on California cities when the agencies were dissolved by the State legislature which needed the property taxes that were siphoned off to fund them.
Beyond the very real consequences to cities and the residents who end up paying the price for these failed projects is the fact that affordable housing funding which is in very short supply was used, and in my view squandered on projects. Instead of using money to actually provide affordable housing, Sacramento's Housing Authority spent a couple million to remove three units of housing and raise the rents on the remainder. What was accomplished was blight removal at the expense of fewer units of affordable housing which were made less affordable. Meanwhile, the waiting list to get into affordable housing units just keeps getting longer.
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