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Record breaking condo project coming to SoMa

lawsuits linger

Originally Posted on the San Francisco Chronicle by  J.K. Dineen

Millennium Partners is breaking ground on a new condo tower and Mexican Museum next to the Rochester Big & Tall Building (creme building seen on corner) in San Francisco, California on Friday, February 27, 2015.

Millennium Partners is breaking ground on a new condo tower and Mexican Museum next to the Rochester Big & Tall Building (creme building seen on corner) in San Francisco, California on Friday, February 27, 2015.

Millennium Partners is preparing to break ground in July on a $500 million condominium tower at Third and Mission streets, a project that could shatter records for the most expensive units ever in San Francisco.

Ten years in the making, the 53-story, 190-unit Yerba Buena tower will rise just to the west of the Aronson Building, a 1903 brick midrise that will be restored and incorporated into the new highrise. The long-stalled Mexican Museum will occupy the first four floors of both the 10-story historic building and the new tower, taking up about 52,000 square feet.

The project will be Millennium Partners third deluxe San Francisco highrise — the group built the Four Seasons Hotel and Residences at 757 Market St. and the Millennium Tower at 301 Mission St. Resale of units in those two buildings regularly crack $2,000 a square foot.

The new highrise will be different in that it will consist mostly of jumbo units with an average size of 2,700 square feet, about 30 to 40 percent bigger than average condos in comparable towers. At $2,000 a square foot, the units in the new tower could fetch an average of $5.4 million.

The three and four bedroom offerings will reach an audience not currently served by the other condos in SoMa and Rincon Hill, said Gregg Lynn, a broker with Sotheby’s International Realty.

“This building is going to fill an unmet demand of affluent consumers who need large apartments,” Lynn said. “I have clients looking for four bedrooms and I can tell you there is nothing out there. I am going to have many clients who are going to want to move to that building when its completed.”

Even by Millennium Partners lofty standards, the tower and Mexican Museum is going to be an complex and expensive undertaking. Millennium Tower, which has 419 units, cost $460 million to construct. The Mexican Museum tower, by contrast, will cost more to build but will have less than half the number of units.

The stratospheric costs are being driven by the fact that the project includes a $30 million museum, the restoration of a historic building and a massive underground garage that also serves as the foundation for the Contemporary Jewish Museum, and Jessie Square itself.

While the developer is paying $5 million to the city’s affordable housing fund, the project won approvals before San Francisco voters approved Proposition K, which sets a goal of 33 percent below-market-rate units. Veteran South of Market affordable housing advocate John Eberling of TODCO, which owns and manages affordable housing, called the project’s community benefits “a fair deal.”

“This is the only way the Mexican Musuem will ever get done,” he said. “That’s an extraordinary, special civic benefit that makes sense.”

The project, however, isn’t being welcomed by all its neighbors. While luxury projects in San Francisco regularly are criticized by affordable housing advocates, the Mexican Museum tower has faced opposition from unexpected quarter — owners of units at a neighboring luxury tower.

For the past two years the building has been the target of two lawsuits filed by the Friends of Yerba Buena, a group of mostly Four Seasons residents who argue that the project violated state environmental study requirements as well as the city’s planning codes in the process of granting approvals. Courts have rejected both lawsuits but the petitioners have appealed the cases to the First District Court of Appeals.

Millennium Partners Vice President Sean Jeffries said he would not wait for a decision on the lawsuits to start construction.

“We have completed design drawings and released them to the general contractor,” Jeffries said. “We think we can start in July. We can’t be certain of when the court decision is going to come down so we are going to go ahead and start construction.”

Matthew Schoenberg, one of the Four Seasons condo owners who is suing Millennium partners over the Mexican Museum project, said Four Season the homeowners support the Mexican Museum but want a shorter building— 351 feet instead of more thna 500 — as well as changes to how the tower’s parking and entrance are configured.

“It was never our intention to stop the building from being built,” Scheonberg said. “We believe it’s the perfect home for the Mexican Museum and having the Mexican Museum is a positive to the area.”

Jeffries said that his group will continue to talk to the Four Seasons homeowners to see if a compromise can be reached.

The project will be the final piece of the Yerba Buena district, a redevelopment area that also includes Yerba Buena Gardens, Metreon and the Moscone Convention Center. The mix of a modern tower and a restored historic structure will not be new to Jessie Square — next to the Mexican Museum site is the Jewish Contemporary Museum, which combines Willis Polk’s brick power substation with an addition that includes an off-kilter blue metal cube designed by famed architect Daniel Libeskind.

In designing the building, architect Glenn Rescalvo of Handel Associates said he was inspired by both of San Francisco’s prevailing building types: masonry buildings with punched windows and glass towers like the ones he designed at the Four Seasons and Millennium Tower.

“Here we wanted to do neither/nor, to take swatches of solid and glass and layer them up,” he said. “It’s a gesture back to the buildings in the area without being predominantly glass or predominantly masonry.”

The excavation and seismic upgrade will be the first phase. The 1970s addition to the Aronson building will be removed. It will be mostly below grade and you won’t see much work for eight months.

“It’s a little more complex than the other sites have have build on in San Francisco,” Jeffries said.

The building will be completed in September of 2018 with sales starting in 2017, according to Jeffries.

“We are hoping the market remains robust and have every reason to believe we are headed down the right path in terms of product type and the market,” he said.

Sotheby’s Lynn called the location “Triple A plus” and said the tower would likely break sales records on a price per square foot basis.

“Whenever Millennium Partners builds a building, they re-create luxury. They have done it twice and they are going to do it a third time,” he said.

The city, which owns the land, will provide provide $14 million for the construction of the museum interior, which the city will own, and the architects’ fees. The developer is also giving $5 million to the museum’s endowment fund. The museum will have 13 galleries, several of them double-height, an amphitheater, cafe and classrooms.

J.K. Dineen is a San Francisco Chronicle Staff Writer. E-mail: Twitter: @sfjkdineen