Can dot-coms house the poor?

A San Francisco development offers cheap rent to start-ups that will teach HTML to low-income tenants.

By Katharine Mieszkowski
Published August 2, 2000 7:12PM (EDT)

WANTED: Socially conscious dot-commers, looking to give back to the community, while you grow your venture-funded start-up. We'll provide 20,000 square feet of prime South of Market real estate with underground parking, in the center of San Francisco's trendy dot-com district, near major transit and just down the street from Stormy Leather, at below market rates. You'll offer job training for the low-income tenants housed in the building.

Two non-profit San Francisco housing developers have hatched a unique plan to try to find homes in the city for the regular people -- read: not millionaires -- who the Net boom is driving out of town. But will dot-commers go out of their way to help low-income residents, even in exchange for the Holy Grail of cheap office space rent?

The Citizens Housing Corporation (CHC) and the Tenderloin Neighborhood Development Corporation (TNDC) think so. They're searching for a commercial tenant for a new "mixed-use" development at a one-acre site at 8th and Howard Streets, which will combine 162 units of low-income housing and 20,000 square feet of commercial office space.

A press release announcing the project gamely dropped all the dot-com buzz words in a clear attempt to speak the Netheads' vernacular: "Prospective tenants, such as new media start-ups, high-tech B2B firms and other innovative ventures, would partner with CHC and TNDC in a new business model that pairs community investment with commercial success."

Above the offices in the five-story building will be one-, two- and three-bedroom apartments. Judging from the plans for the project, the new edifice will look much like the live-work lofts sprouting up all over South of Market where so many dot-commies themselves live. Hopefully, graffiti artists who love to hate and decorate live-work lofts won't mistake this attempt to help those who have missed out on the dot-com boom for just another pricey incursion into the previously cheap warehouse district.

Norrie Boyd, project manager at Citizens Housing, says that the tenants will likely be "your typical renter that is being priced out of the San Francisco housing market." In San Francisco, the median income is almost $75,000 for a family of four. People who make anywhere from just 25 percent to 60 percent of that median -- or $18,750 to $45,000 -- will be eligible for cheap rent.

"Maybe some of these people are going to be just starting out in some kind of tech firm, or maybe they're cleaning the building in the tech firm," says Boyd. "These are working people. They're not homeless. They're working folks, but they can't afford rent in San Francisco, so they need to be subsidized. It really is like a teacher's salary or a lot of municipal workers' salaries."

As for the vocational training part of the deal, the nonprofit developers recognize that some start-up mavens may not be able to take time out of their own 120-hour work weeks to train the building's low-income residents in HTML or JavaScript, but still may want to help (and get in on that cheap office space). So, hiring a third party to do the vocational training, even off-site, will also be an acceptable way to fulfill that part of the bargain.

The only catch in this happy plan: The space won't be available until 2002, at the earliest. And Boyd recognizes that's a lifetime to an Internet company. "To have space available in 2002 doesn't help a lot of dot-coms, because they can't look that far into the future," she says. Not to worry. If the Net company plan doesn't work out, there's always Plan B -- the philanthropic route, whereby a community or corporate foundation (think old money, Old Economy) would pay for an arts organization or other nonprofit to occupy the commercial space.

But surely the economics will suit the new thrift of the dot-com world. Maybe with such innovative "aligning of interests," dot-commers can better co-exist with the rest of San Francisco.

Katharine Mieszkowski

Katharine Mieszkowski is a senior writer for Salon.

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