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San Francisco's recent loft-building frenzy offers painful but valuable lessons.







Blocks of brand-new real estate stand empty in San Francisco after developers flooded the market with shoddy, overpriced loft-style buildings.
Photos: David Lawrence/Cheryl Meeker
New York artists may have spearheaded the loft movement, colonizing the formerly industrial Soho district in the 1970s and 1980s, but San Francisco was among the first U.S. cities to experiment with regulating it. It is also the first city to experience what can only be termed a live/work backlash. The city's Artist Live Work Ordinance, passed in 1988 to encourage the development of combined residential/studio space, has proven to be a largely unmitigated disaster.

Originally intended to foster artists' lofts in areas zoned for industrial use, the ordinance had lax regulations that were easily subverted by a real-estate industry eager to convert warehouses and workshops into overpriced commercial or residential spaces. "Once live/work was allowed by right, developers could buy up industrial land, build on it, and quadruple their profits," artist Debra Walker says. "Because it was assumed it would all be affordable housing, they didn't have to pay all sorts of taxes." Meanwhile, the process jacked up local real-estate prices, only exacerbating the problem of affordable housing for artists.

Aided and abetted by a compliant city planning commission under pressure to encourage growth, developers were able to secure for their clients relatively lenient residential loans for what were blatantly commercial-use projects. "What made this whole thing go crazy was that the mortgage companies were doing their own enforcing," Walker explains. "The planning commission was saying, 'We have no way of knowing who a person engaged in an arts activity is.' So rather than not allow live/work to be built, they just ignored all the rules and, in effect, any zoning altogether."

Hand in hand with this relaxed regulatory climate went an already complacent attitude toward building inspections. Backed by a rapacious construction lobby, developers were effectively allowed to make their own inspections. As a result, speculators have thrown up what Berkeley architect Tim Rempel calls "a lot of poorly built lofts at an increase in price that did not come with an increase in quality." He predicts "a lot of lawsuits ten years from now," as the shoddy construction of these speculative dwellings becomes glaringly apparent.

Faced with this dog-in-manger scenario, in April 2001 the San Francisco Board of Supervisors--previously under the influence of the stridently pro-development mayor, Willie Brown--appointed a task force to investigate a solution. The group recommended a repeal of the 1988 ordinance. "All of us agreed that the ordinance as it was written--and for the intention it was written--failed because it was unenforceable," says Walker, the only artist on the task force. "You don't need the ordinance for what it was crafted for. You never did. Whether you're an artist or just anyone running a business, you've always been able to take residential occupancy of an industrial space."

What's been wrong with the picture is that "residential occupancy" has traditionally been difficult to define. But as it turns out, a section of the building code that predates the Live Work Ordinance provides a viable live/work regulation, including requirements that the residential component of an industrial space be no more than 25 percent of total square footage. So the task force made a simple proposal: strengthen and restructure the code that predates the 1988 ordinance, but build in greater code enforcement. "That way," Walker says, "a building inspector can go in and--instead of having to figure out if somebody is an artist--simply look around and see if the building is being used as a commercial space." Passed in April, the repeal will guarantee that anyone planning to build or convert new live/work space in the city faces at least minimum supervision by city planners.

What remains to be seen is whether a reversion to the regulatory status quo holds out much hope for San Francisco artists, who have become the urban equivalent of refugees. "In San Francisco, live/work codes didn't protect artists at all," says Abby Wine, program coordinator for ArtHouse, an advocacy group for affordable space for artists. "To guarantee their continued existence, city government has to put other protections in place."


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