In Planning lingo, Chutes are achievable development opportunities to expand successful development into a larger area. Blake Smith’s 1401 Midtown is a classic Chute, as are the Marmot and Dark Horse holding on Haskell Street. Chutes need to be encouraged by all levels of government review and be encouraged and rewarded.
Blocks, on the other hand, are individual properties that are preventing otherwise successful redevelopment areas from spreading. The Ponderosa (Methderosa) Hotel in Baja Midtown is a prime example of a Block.
The biggest Block preventing the Riverwalk District and the Powning District along the Truckee to merge and progress farther north has been the Greyhound bus depot at 155 Stevenson. There is a glimmer of hope – the depot has been listed for SALE. The price is mind-boggling at over 8x assessed land value and $80/SF, and I shudder to even think of the environment clean of costs after 50 years of underground leaking diesel tanks. But it is a start removing a critical Block. I hope the seller will get reasonable on the price, and I hope the City will get reasonable with their DRRC Truckee River District design standards which have killed all development since they were adopted. That’s right, ZERO development since the standards were adopted.
Any project with the Siegel Group attached to it seems to be a Block to me. They have just filed a permit to add micro-kitchenettes to 109 rooms at the Virginian at 140 N Virginia. $520 permit value per door on units that retail for around $1000 each plus plumbing and electrical costs. I suspect Community Development may take issue with the proposed permit value. Most interesting on the Permit Application is the Code Enforcement section. It appears that Siegel Group got busted trying to replace the boilers without a permit, and face a 2x permit fee penalty. This would be 10x in San Francisco. Siegel is up at the Redevelopment Agency meeting next week for more discussion on their Truckee River Lane building / land swap / rental agreement. Nuff said.
I’ve been silent lately on my gut feelings on our housing market since it has been rather dour. In spite of all the Realtor hype, our market median has been essentially flat, bouncing around $290K last July 2015. The initial Tesla Bump was premature. But the demand is real as Tesla, Switch, Apple and their subcontractors gear up hiring and relocate employees. I would not be surprised by a 30% year over year increase in the median home sale by the end of the year (we are currently at +8%, even with the lackluster performance over the last 3 Qs). RICCOHs (RIch Californians Coming Over the Hill) are starting to run up the market, and the developers are systematically refusing to develop and add new inventory. They know their target markets well, and it ain’t us locals
I’d be very interested to hear your views on other Blocks you see. Also on other Chutes, as they are the Next Big Deals. I’m watching Victorian Square and 7th and Keystone.