After almost 2 years of negotiations with community groups and city officials, a planned housing development at the site of the former Lucky Penny diner is coming before the Planning Commission again this Thursday.
For over 20 years, the diner at the corner of Geary and Masonic in the Richmond District provided residents with a classic late night greasy spoon dining experience. Yelp reviewers sang its praises with paeans such as, “Seriously, where else can you sit your drunk ass at 3 in the morning to eat some hash brown and eggs?”, or “Service: Really nice and patient, I felt really bad for making fun of our waitress in my drunken-mean-bitch-mode.” For many residents, it was kind of like that Edward Hopper painting, “Nighthawks:” they liked the idea of the place being there, but never went in; or if they did go in, they don’t remember it.
That ended in late 2015 when the property owners, wanting to take advantage of increased demand for commercial space and desperately-needed housing, decided to close the restaurant and redevelop the lot it stood on as a mixed-use building. It was something they had wanted to do for years, but had struggled with the district's existing zoning code. Being right on Geary, the lot was zoned NC-3, and only allowed for one residential unit for every 600 square feet of lot space. The owners worked with a developer to create plans for a seven-floor building with 21 multi-bedroom apartments on the top three floors, the remainder dedicated to office, retail, and 57 parking spaces. That plan would be grandfathered under the inclusionary housing guidelines passed the previous summer, so a minimum of 12% of the dwelling units would be offered at below-market rate (BMR).
The Lucky Penny site with 21 housing units.
Given Geary’s status as a major transit corridor, coupled with plans for new high-end housing at nearby sites owned by UCSF and California Pacific Medical Center, that version of the project wasn’t bringing much new to the area in terms of more affordable housing (subsidized or otherwise).
And financially, it didn’t pencil out. In order to break ground, there would have to be more housing.
So the developers worked with Supervisor Mark Farrell the following year to draft legislation creating a Special Use District, in hopes that the project could satisfy both financial demands, and the City’s pleas for apartments without so many eye-popping price tags.
“I support housing being built on the Lucky Penny site – period,” said Supervisor Farrell. “Housing development in San Francisco is not a zero-sum game and I want to ensure that this project is actually built, so that it can address our housing shortage crisis.”
A second plan, submitted this past Spring, called for eight floors, with 98 residential units, a single ground floor retail or restaurant space, and parking for 36 cars. Still grandfathered under Prop C, the plan nevertheless offered an increase in BMR units to 18%.
At the same time, Supervisor Katy Tang was proposing legislation to increase affordable housing opportunities in the City’s residential neighborhoods. This culminated in the HOME-SF program, which passed this past May. Some proponents hoped this would be a godsend for the Lucky Penny development.
On the surface, it might’ve looked like the new program would be an ideal fit for making 2670 Geary a viable project, without the need for a special use district. The Planning Department strongly encouraged the developer to redo the plans yet again: the project would then include 121 units, a full third of which would be BMR. It also rose to 10 stories, with the roof line rising above the adjacent storage facility.
The Lucky Penny site with 121 units.
That’s when it hit the fan.
Some local residents became upset about the taller project and greater density. There were even unconfirmed rumors of plans to file a legal appeal against the Environmental Impact Report. Ironically, both sides were aggrieved, since the higher percentage of mandated affordable units also threatened the economic viability of the project.
Cue another round of back-and-forth with the Planning Department. In the meantime, the empty diner became a graffiti magnet.
Fortunately, there now appears to be a resolution, with yet another plan being submitted, accompanied by Farrell’s special use district legislation in place of HOME-SF. The project is now eight stories, with a roofline that matches the adjacent building.
The Lucky Penny site with 95 units.
It also has 95 apartments, including a mix of studios and two and three bedroom apartments – essentially the two classes of apartment the city needs the most. The BMR percentage has been lowered to 23% (still higher than the first two plans), and four of the 22 required affordable units will be middle income.
“95 units is still a great opportunity,” says Jane Natoli, a Richmond resident active in Grow The Richmond, a grassroots housing advocacy group. "My read on it is that this is going to allow them to move forward faster… I can definitely understand that some people would feel disappointed if they felt there was going to be more affordable housing [under HOME-SF]. Part of going forward under the Special Use District is that there will still be a higher BMR percentage. I think it's a good compromise. 95 units is a hell of a lot better than the 21 that they started with… We can't let the perfect be the enemy of the good.”
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