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By Corrie M. Anders
Six luxury condominiums that have been a hard sell to seniors are back on the market with marked-down prices after the developers lost their plea before the Planning Commission to offer the 24th Street units to the general public.
The commission's 5-1 denial was a major triumph for senior advocates and Noe Valley's neighborhood activists, who complained that the two-year-old units, originally priced at more than $700,000, were not "affordable."
Critics also told the commission that the developers compounded their own problems by not aggressively courting the senior market.
"It appears they didn't do much to sell them or convince seniors to give up their cars," said Eleanore Gerhardt, a nearby 24th Street resident. The building has no parking garage, and the units are reserved for seniors 62 and older without cars.
Gerhardt was one of 24 people who signed up at the commission's Sept. 27 public hearing to oppose the elimination of age restrictions at the complex, located at 3953 24th Street across from Bell Market on the site of the old Lunny House.
Anastasia Yovanopoulos, a retired preschool teacher who lives at 24th and Dolores streets, said she had been "sold the same bill of goods"--that the condos would be affordable for seniors. She said the developers' claim that they couldn't find senior buyers was "disingenuous" and that she suspected the building owners planned to go after general public sales all along.
Five people spoke in favor of the change, including the property owners.
Jeremiah Cullinane said he and his partners--Denis Cullinane and Eileen Long--had lost more than $600,000 on the development, which also includes two ground-floor commercial spaces that were leased earlier this year.
"If anyone thinks we're not trying to sell them, it's a joke," Jeremiah Cullinane told the commission, rebutting complaints that open houses for the condos were spotty and that it was difficult for interested persons to get information.
Long's husband, builder Brian Maloney, testified that the unsold units were costing the partnership $21,592 a month in construction loan fees.
"No matter what we do now, we will lose money," Maloney said. "The only person making money here is the bank."
New Prices to Be Set This Month
The commission's rejection left the developers once again coping with how much to charge for the condos--five one-bedroom units and one studio--which are ideally located in the heart of Noe Valley's shopping district.
"We are still having to fine-tune the prices," said Long, who is also a real estate agent with Vanguard Properties in San Francisco. New prices would be set this month, she said.
The one-bedroom units previously had been reduced to $559,000 from as much as $745,000 when they were first offered for sale two years ago. The last price for the studio was below $500,000.
It was the failure of even those lower prices to attract seniors that prompted the developers to ask the city to drop the age restriction. Their proposed modification also would have required the building owners to reconfigure the six condos to five units. In addition, the developers would have made a substantial payment into the city's housing fund.
The city's planning staff took note of the static sales and the fact that the city encourages new housing without parking along public transit corridors such as 24th Street. The staff recommended approval, though planner Elizabeth Watty acknowledged public sentiment that the developers were "insincere" in their intentions to sell to seniors.
Conflict Goes Back Five Years
The development has been problematic and controversial since its inception five years ago.
In May 2002, the Long-Cullinane partnership paid the Robert and Evelyn Lunny Estate $700,000 for a boarded-up house that had become a neighborhood eyesore. They announced plans to demolish the century-old residence--which upset preservationists--and replace it with a contemporary-style building that would have four upscale condos, ground-floor commercial space, and underground parking for four cars.
A number of nearby neighbors, merchants, and civic activists protested that the proposed four-story structure was too big and that cars entering and leaving the garage were a potential danger to pedestrians on 24th Street's busy sidewalk.
To win neighborhood support, the owners agreed to several compromises: seniors-only housing with no parking, a less bulky building, and a more harmonious Victorian façade. The building also would have six units--one of them a "bonus" for building senior housing--instead of four as originally planned.
Location Isn't Everything
Long said the partners believed that the condos--beautiful by all accounts--would appeal to seniors who wanted to downsize from larger homes but remain in Noe Valley, with its easy access to shops, restaurants, and services.
"I was confident I could sell this building," Long said, noting that the real estate market was booming in mid-2005. "I had what every real estate agent wants: location, location, location."
Four months later, at Christmas time, Long said the group had not one single offer. Over the next year, she said she appealed to any potential buyer who would listen. "I was very frank with them: make me an offer," she said. "No one bit."
Lack of Space a Problem
In an interview after the hearing, Long said a combination of shortcomings hurt sales. The main obstacle was that the condos only had one bedroom. She said the city required that a senior building have three means of egress, and that cut into living space. The condos range from a one-bedroom, one-bath unit with about 450 square feet, to one-bedroom, two-bath units with 700 to 750 square feet of space.
"We had a lot of interest, but everyone wanted two-bedroom units," Long said.
The lack of parking also was an impediment. "The kids loved the place and wanted their parents to be there,'' she said, but seniors worried that they couldn't get to doctors' appointments or run other errands without their cars.
Another downside was the extra expense of living in the building. In addition to mortgage payments, the complex carried $450 a month in homeowner dues, and seniors were "just not interested in that," Long said.
What About Renting?
If the owners are unable to sell the units, 25th Street resident Charlie Spiegel told the commissioners at the meeting, the condo complex would be an excellent choice as rental housing for older residents.
"It's one of only three elevator buildings on the commercial strip in Noe Valley," he said. "It's perfect for seniors."
Spiegel appeared with his mother, Ruth Spiegel, 80, a 19th Street resident who said she had been looking for five years to find an appropriate apartment nearer her son.
"I don't have a car. A flat street where I can walk to stores is important to me," she said.
But Long said her team had no plans to rent the condos. "The amount of rent needed to cover our mortgage doesn't work for us," she said. "We're kind of between a rock and a hard place."