Mr. Craig Young, Managing Principal Tidewater Capital 25 Taylor Street San Francisco, CA October 27, 2014

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95 Brady Street San Francisco, CA 94103 415 541 9001 info@sfhac.org www.sfhac.org Mr. Craig Young, Managing Principal Tidewater Capital 25 Taylor Street San Francisco, CA 94102 Ref: 1028 Market Street Mixed-use Development Dear Mr. Young, Thank you for bringing your proposal for 1028 Market Street to the San Francisco Housing Action Coalition s (SFHAC) Project Review Committee on October 8 th, 2014. Because this project is still in a relatively early stage, we are not yet able to make a formal endorsement until more of its features have been finalized. We strongly encourage you to present the proposal to us again once you ve solidified these elements. Nevertheless, we believe your project has many merits and will contribute to SFHAC s mission of increasing the supply of well-designed, well-located housing in San Francisco. Please review this letter, which explains how your project meets our guidelines as well as suggested improvements. We have attached a copy of our project review guidelines for your reference. Project Description: The proposed project would replace the long-vacant Hollywood Billiards site with 186 apartments in a 120-foot height district, with about 10,000 square feet of ground floor, neighborhood-serving retail and subsurface parking. Land Use: The SFHAC believes this is an excellent location for new housing. In an effort to draw residents to your site, you have transformed the building into a temporary food hall. Our members believe the food court is an excellent community outreach gesture that will help jump-start the activation of the neighborhood. The project site is located in the rapidly evolving Mid-Market neighborhood and is within walking distance of many of the City s jobs. We strongly support new housing here as a means to activate an area that would greatly benefit from it. Density: The SFHAC strongly supports your approach to maximize the site s density, including buying transferable development rights from the neighboring historic building. The San Francisco Housing Action Coalition advocates for the creation of well-designed, well-located housing, at ALL levels of affordability, to meet the needs of San Franciscans, present and future.

Page Two Affordability: The SFHAC commends your plan for putting 22 Inclusionary below-market-rate units on site. Parking and Alternative Transportation: Our Project Review Committee believes this project successfully embraces the principles of transit-oriented development and promotes our City s transit-first policies. The site is located near the Civic Center BART and Muni rail station and is within close proximity to several Muni bus stops. It also fronts the City s premier bicycle corridor on Market Street. The project proposes 23 underground car parking spaces, including two car-share spaces, a low ratio of about 0.12 spaces to one residential unit. In addition, it plans to provide 131 bicycle spaces. Our members would still like to see more details on how the bike parking is configured as well as any plans to include Class II bike parking outside the ground-floor retail. Preservation: There are no structures of significant historic or cultural merit on or near the site that would be affected by your proposal. The proposed building is in a historic district and adjacent to a historic building. Urban Design: The SFHAC supports how the project s Market Street frontage respects the nearby Market Street buildings and presents a modern interpretation of the classic basemiddle-top modulation. Our members believe it generally fits contextually with the surrounding neighborhood. The ground-floor commercial space on Market Street will help activate the neighborhood, something it sorely needs. In a follow-up presentation, we would like to see the plans for the portion of your building that fronts Golden Gate Avenue. These plans were not presented to us in your presentation. Some of our members said that the design would be improved by emphasizing the building s entrance and lobby to distinguish it from adjacent spaces and create a stronger identity as a residential building. We understand the open space is still in design, but would be provided with both a roof deck and other amenities, including a fitness center. The ground floor has been designed for at least one large retail space, though it might be broken into a few smaller retail spaces. There was lengthy discussion about how this space could be used. Our members were very supportive of ground-floor spaces that bring the community together and serve the local neighborhood, as your current food hall does. We look forward to seeing the plans again as these issues are resolved.

Page Three Environmental Features: The SFHAC supports the measures you employed to enhance the sustainability of the project, which targets LEED Silver or equivalent. Some of your proposed environmental features include low-flow plumbing fixtures and storm water capture and reuse. Community Input: It appears that you have been thorough in your outreach to the community. This includes meetings with the Tenderloin Community Benefits District, TNDC, Community Housing Partnership, Tenderloin Housing Clinic and others. During your presentation to our Committee, you expressed that community feedback has been positive. We understand you are still conducting community outreach and we encourage you to continue to engage the neighborhood and respond to legitimate concerns that can readily be accommodated. We believe this project sets a valuable precedent for this neighborhood and look forward to seeing its design as it evolves. Please keep us abreast of any changes and let us know how we may be off assistance. Sincerely, Tim Colen, Executive Director

Page Four SFHAC Project Review Guidelines Land Use: Housing should be an appropriate use of the site given the context of the adjacent properties and the surrounding neighborhood and should enhance neighborhood livability. Density: The project should take full advantage of the maximum unit density and/or building envelope, allowable under the zoning rules. Affordability: The need for affordable housing, including middle income (120-150 of Area Median Income) housing, is a critical problem and SFHAC gives special support to projects that propose creative ways to expand or improve unit affordability beyond the legally mandated requirements. Parking and Alternative Transportation: SFHAC expects the projects it endorses to include creative strategies to reduce the need for parking, such as ample bicycle storage, provision of space for car-share vehicles on-site or nearby, un-bundling parking cost from residential unit cost, and measures to incentivize transit use. Proximity to transit should result in less need for parking. In districts with an as-of-right maximum and discretionary approval up to an absolute maximum, SFHAC will support parking exceeding the as-of-right maximum only to the extent the Code criteria for doing so are clearly met. In districts where the minimum parking requirement is one parking space per residential unit (1:1), the SFHAC will not, except in extraordinary circumstances, support a project with parking in excess of that amount. Preservation: If there are structures of significant historic or cultural merit on the site, their retention and/or incorporation into the project consistent with historic preservation standards is encouraged. If such structures are to be demolished, there should be compelling reasons for doing so. Urban Design: The project should promote principles of good urban design: Where appropriate, contextual design that is compatible with the adjacent streetscape and existing neighborhood character while at the same time utilizing allowable unit density: pleasant and functional private and/or common open space; pedestrian, bicycle and transit friendly site planning; and design treatments that protect and enhance the pedestrian realm, with curb cuts minimized and active ground floor uses provided. Projects with a substantial number of multiple bedroom units should consider including features that will make the project friendly to families with children.

Page Five Environmental Features: SFHAC is particularly supportive of projects that employ substantial and/or innovative measures that will enhance their sustainability and reduce their carbon footprint. Community Input: Projects for which the developer has made a good faith effort to communicate to the community and to address legitimate neighborhood concerns, without sacrificing SFHAC s objectives, will receive more SFHAC support.