By Christin Evans, HANC Board
Both the San Francisco Planning department and advocacy group Small Business Forward have forecasted significant displacement of small businesses due to the city’s upzoning plans according to presentations made at the April 17 meeting of the Planning Commission.
Preliminary estimates from the city’s planners indicated approximately 5,600 businesses are registered in the NCDs (Neighborhood Commercial Districts) where Mayor Lurie’s latest upzoning proposal concentrates the greatest increases in height limits. City planners said over 1,000 businesses are located in single or double story buildings most likely to be attractive to real estate developers. Of those, they estimated that approximately 53 small businesses on average per year would be at risk for displacement from development, putting the total number of businesses that could be forced to relocate in the next ten years over 500.
Small Business Forward cautioned that additionally speculative price increases would likely push out small businesses long before construction begins. And then when construction is underway, that neighboring businesses could see declines in foot traffic harming those businesses as well.
Most small businesses, estimated to be 80%+, do not own their building, but rather lease. And unlike residential tenants who do have some displacement protections, commercial tenants do not have similar legal protections beyond their negotiated lease. Small Business Forward warned that small businesses were already seeing shorter lease terms offered by corporate landlords and even some small businesses were precariously in a month-to-month lease situation.
With an acknowledgment that a significant number of businesses will ultimately be displaced, discussions have ranged across potential policy solutions, including relocation assistance, displacement payments, and city supported loans to support small businesses when faced with displacement. No firm proposals have been made however by Mayor Lurie’s team. Conversations are expected to continue through the summer with legislation being developed no later than by September this year.