During the past decade, applicants and units entered in the annual condo-conversion lottery have doubled, yet the maximum number of winners has remained the same.
According to the Department of Public Works, 366 individuals applied to convert nearly 1,100 units in 2001. In 2011, 681 people applied to convert more than 2,300 units. But under The City’s rules, only 200 conversions were allowed each year.
“One wonders just how large the condo lottery pool needs to get before city government understands that San Franciscans want the number of units allowed to convert to be increased,” Peter Reitz, the executive director of the Small Property Owners of San Francisco Institute, wrote in the group’s monthly newsletter.
Reitz’ group — along with Plan C, which formed specifically to reform The City’s condo-conversion process — has called for the 200-unit cap to be lifted. The institute and Plan C supported former Mayor Gavin Newsom’s proposal to charge a fee to bypass the conversion lottery.
But tenants groups and progressive lawmakers have fought attempts to increase the number of conversions, saying doing so would reduce the rental stock and lead to higher prices citywide.
The Newsom plan was expected to raise $8 million based on the conversion of about 600 units, but that plan was scuttled last year by supervisors John Avalos and David Campos.
After Mayor Ed Lee met with groups in Avalos’ district Thursday, the supervisor said there might be hope for a compromise. According to Avalos, Lee said he would work with tenants’ rights groups to come up with a plan they can support.
That lottery-bypass plan might again be submitted in the budget process this year.
“[The mayor is] definitely considering it along with a whole other list of ideas,” said Christine Falvey, a spokeswoman for the mayor. “He wants to make sure the impacts are well-considered.”
At least one new supervisor is a strong supporter of loosening restrictions on condo conversions.
“People went into the [tenancies in common] thinking they could convert and they’re finding that they’re trapped,” Supervisor Scott Wiener said. “It’s a troubling situation, and in my view we should provide relief to these owners.”
Wiener suggested the money generated through a fee-based conversion process could go to affordable housing.
The condo lottery is held every year around February. Tickets cost $250, though thousands of dollars in inspection fees are required before a unit is even eligible for conversion.