Committee backs forwarding $20.9M permanent loan for 64‑unit small‑sites project at 1005 Powell

The Budget and Finance Committee on May 15 recommended forwarding to the Board of Supervisors a resolution authorizing the Mayor’s Office of Housing and Community Development (MOHCD) to execute permanent financing for 1005 Powell Street under the Small Sites program.

Aliyah Gage of MOHCD said the property—located on the Chinatown/Nob Hill border in District 3—includes 64 SRO units (one manager unit) and two ground‑floor commercial units. The building was acquired by Chinatown Community Development Center (CCDC) in December 2021 and underwent a substantial rehabilitation (permits completed March 2024). Rehabilitation included elevator modernization, accessible bathrooms on every floor, window replacement, LED lighting, Energy Star appliances and heat pumps to improve operations and reduce costs. MOHCD said the project received a senior operating subsidy previously approved by the Board that provides $6.2 million over roughly 15.5 years for 35 units; MOHCD expects this structure will enable rents at about 60% of area median income for covered units.

MOHCD requested a permanent soft loan not to exceed $20.9 million on a 40‑year amortization to fund acquisition and rehabilitation, replacement and operating reserves. Gage said MOHCD is providing an upfront operating reserve and CCDC will contribute $1.8 million over 10 years and additional interim financing of about $1.8 million and commercial upgrade contributions noted in the record.

Supervisor Connie Chan praised the project’s community benefits but raised concerns about long‑term operating deficits and the sinking fund model; she asked staff to pursue potential state, federal and city financing tools to sustain small sites. Supervisor Myrna Melgar questioned whether equipment choices (electric cooktops, energy upgrades) had produced operating cost data; CCDC’s project manager said pre‑acquisition usage data are limited but energy‑saving measures were installed, and BayREN upgrades and other electrical/plumbing work were completed as part of the rehab.

There were no public speakers. Vice Chair Rafael Mandelman and other committee members expressed support while acknowledging fiscal sustainability concerns. Chair Chan moved to forward the item to the full Board with a positive recommendation; the motion carried with three ayes.