Commission upholds MND and clears Chestnut Street mixed-use grocery project, with delivery and curb conditions

San Francisco  The Planning Commission on March 24 denied an appeal of the environmental determination and approved a 49-unit mixed-use project at 2055 Chestnut Street that includes roughly 15,000 gross square feet configured to accommodate a neighborhood grocery. Commissioners voted to uphold the Preliminary Mitigated Negative Declaration (PMND) and grant the conditional-use authorizations with additional conditions to manage curb loading, monitoring and alternatives.

Staff framed the project as a planned-unit development that replaces a drive-through bank and surface parking lot with ground-floor retail, a potential grocery in a basement and residential units above. The PMND analysis relied on the city's vehicle-miles-driven and transportation-impact guidelines and concluded that with required mitigation measures  including a driveway loading and operations plan (DLOP), colored curb/loading zones and monitoring  the project would not cause significant environmental impacts under CEQA.

Neighbors and merchants testified both for and against the project. Opponents raised concerns about cumulative construction impacts, the ability of Lombard Street (state highway frontage) to absorb truck maneuvering and potential congestion if large delivery trucks must back into the site. Appellants requested independent geotechnical review, stronger mitigation for loading conflicts, and alternatives such as smaller retail footprints or senior housing uses for parts of the site.

Project sponsors (Prado Group) and leasing experts said they would market the grocery space and that full tenant selection takes place after entitlements; they argued basements are commonly used for grocery merchandising in dense neighborhoods. The sponsor committed to work with SFMTA and the Planning Department to secure colored curb zones, and staff read and the sponsor accepted a condition requiring the sponsor to identify and obtain alternative curb/zone designs if initial SFMTA/Caltrans requests are denied.

Commissioners debated the DLOP and monitoring timeline. Commissioner Diamond sought a faster first evaluation; the commission amended the condition to require the first DLOP evaluation report within six months after the grocery begins operation (rather than the longer review window proposed in staff materials). The commission also included a condition to pursue alternative curb designs if SFMTA does not approve the initial colored-curb plan.

The commission upheld the PMND and approved the project with the added conditions; the final vote to approve the entitlements was 5 to 1, with Commissioner Moore dissenting.