Just My Opinion…
SAN FRANCISCO OVER REACTS ONCE AGAIN
I've heard it all before. First, an increase in the minimum wage was going to hike restaurant prices, force staff layoffs, tourists would leave town because wouldn't be able to afford to eat here, restaurant doors would close. Then a hike in the cable car fare was going to force tourists to shun cable car rides, empty cable cars would idle on the turnstiles, eventually shut down, and then disappear. And it's happening again. The Fairmont Hotel is thinking about converting 226 hotel rooms into 61 luxury condominiums. No plans have been drawn, no permit papers filed, years away from happening. But within hours of this news hitting the streets, assumptions were being made that maids, bell caps, chefs, janitors, and doormen would be out of work. A city hall hearing had hundreds in attendance. Signs appeared. Soon every hotel room in the city would become condo. Tourists, of course, will be driven away. The economy will sag. Conventions will not come to town. Affordable housing will be impacted.
First of all, tons of service workers are not going to be out of work. There will be tons of hotels left in town that will need staff. Residents of these hotel condos will need the services of maids, room service, bell caps, chefs, janitors and doormen, something quite routine in New York hotel/condos and other large cities for years. Property taxes will come into the city coffers every year. Residents who can afford these condos will spend money on luxury items and entertainment.
It doesn't appear that conventions will be highly impacted if the Fairmont condos come to exist. A quick check of a few summer conventions indicates the National Minority AIDS Council, with 3,000 anticipated attendees, is bunking at the Hilton San Francisco and the Renaissance Parc 55. The American Numismatic Association, 3,500 anticipated attendees, has a choice of staying at the Hilton San Francisco; San Francisco Downtown Courtyard; Handlery Union Square; Hotel Milano; or, the Westin St. Francis. The Association for Theatre in Higher Education, 900 anticipated attendees, will be staying at the Westin St. Francis. Young Democrats of America, 1,000 attendees, will be at the Holiday Inn Golden Gateway. The anticipated 15,000 attendees expected at the Linuxworld Convention will be at the San Francisco Marriott. The San Francisco International Gift Fair, with a whopping 40,000 anticipated attendees, has a laundry list of hotels from which to choose. Note that the Fairmont Hotel has not been mentioned.
Everyone needs a place to live, even the rich. As for affordable housing, well, none really exists in San Francisco. A quick check of an on-line realtor shows 243 properties for sale, the most expensive being a condo in Pacific Heights for $7,500,000. The least expensive is a studio TIC in Cow Hollow listed for $276,500. If I wanted to put down $55,300 (20%) down at an interest rate of 6.50% on a 30-year loan, my monthly payment for this studio would be $1,398.13. It's a given that I don't have $55,300 in my pocket. And even with a permanent, decent paying, full time job, I could not afford the monthly payment unless I gave up some basics. I suppose I could get a couple of room mates, throw down some Aero beds, and I'd be able to afford it, but then there would probably be picketing on the sidewalk out front that too many people are living in one room. I could put up some walls but it would take me years to get through the permit process, even with a permit expediter, and then I'd have any number of housing activists watching me to make sure I didn't sell the rooms at a profit. It's obvious that housing wars of one kind or another are rampant in San Francisco. The Fairmont condo conversion is just another one, and we shouldn't get so excited about it so soon. Should 61 condominiums become available for living space, it won't drive away tourists, conventions won't go elsewhere, affordable housing still won't be available. San Francisco needs to get as angry over that last one as it has about the Fairmont condo conversion.