Organized Labor

Prop. G Wins Big; Prop. F Goes Down in Victory for $1.2 Billion Project

Sixty-one percent of San Francisco voters said yes to Measure G in the June 3 election, overwhelmingly endorsing Lennar Corp's $1.2 billion development project at the Hunter's Point Shipyard and Candlestick Point. It would be the city's largest redevelopment project since World War II.

In exchange for land, Lennar has promised to spend more than $1 billion on infrastructure to remake the combined 720 acres with 10,000 residential units, 2,000,000 square feet of commercial space, sports and performance arena, 400 acres of park and open space–including seven miles of waterfront walkways, wildlife habitat and restored wetlands–and a new stadium if the 49ers decide to stay in San Francisco. The company also said it would rebuild the Alice B. Griffith apartments, a public housing development that has fallen into disrepair.

Proposition G is not a legally binding agreement. The vote amounted to public endorsement of the project. The development plans will still undergo the required environmental review process and will need approval from the San Francisco Planning Commission and the Board of Supervisors.

Voters also rejected Proposition F, a competing ballot measure spearheaded by Supervisor Chris Daly, which would have required that 50 percent of the new units be affordable to low- and moderate-income residents. Prop. F was widely regarded as a poison pill that would have made the project economically untenable for Lennar or any other private developer. No housing project in San Francisco has been built with more than 30 percent affordable housing.

"We are thrilled by the success of Proposition G and relieved by the failure of Proposition F. Prop G was an essential step toward 15 years of work for us," said Michael Theriault, Secretary-Treasurer of the San Francisco Building Trades Council. "For all that its intent may have been noble, Prop F was conceptually flawed and would have blocked that work."
As a condition for supporting the project, the San Francisco Labor Council, ACORN, and the San Francisco Organizing Project entered into a community benefits agreement (CBA) with Lennar. If the project moves forward, Lennar will:

• ensure that 32% of housing units built within the project are affordable, at a range of income levels; 1600 units, including those at the Alice Griffith public housing development will be rental units reserved for households whose income is equal to or less than 60% of the area median income which is $64,267 for a family of four;
• provide over $27 million in housing assistance funds over the next nine years targeted to neighborhood residents, including down payment assistance enabling additional units to be sold below market rates;
• provide over $8.5 million in job training funds over the next seven years targeted to neighborhood residents;
• ensure that all project employers participate in a local hiring program
• ensure that any hotel, restaurant or grocery store project or any agreement for the use of stationary engineers, security or custodial services or complies with the city's card check policy so that those workers will have a right to unionize.

A community benefits agreement, (CBA), is a private contract between a developer and a community coalition that sets forth the benefits that the community will receive from the development. Several major developments have been successfully built with a CBA including CIM's recent project in downtown San Jose and Staples Center in Los Angeles. The massive sports and entertainment project, "LA Live," adjacent to Staples Center and currently under construction, is also being built with a CBA.

"We negotiated extremely aggressively to make sure this deal provides the greatest amount of affordable housing in the history of San Francisco if not the state," said Tim Paulson, Executive Director of the San Francisco Labor Council.

"After 10 years of being a part of the Bayview community, we want to thank the city and the residents of San Francisco for the vote of confidence they have given us tonight to carry forth their vision for the Bayview-Hunters Point," Lennar Chief Investment Officer Emile Haddad said.

Lennar expects the project to be a solid, long-term investment. Despite widespread troubles in the real estate market, housing prices in San Francisco remain relatively strong. "Our hope is that the market is at a better point in 10 years when the project is complete," said Haddad.

In other primary election news, several SFBTC endorsed candidates went on to victory. Rep. Jackie Speier easily won her primary for the 12th Congressional District with 85 percent of the vote. Mark Leno, who received a dual endorsement from the Building Trades Council along with incumbent Carole Midgen, won the nomination for State Senate's 3rd District, and Fiona Ma and Tom Ammiano both easily won their primaries for State Assembly seats with over 97 percent of the vote.