By Faris Faraj
Contributions by Reneé van Staveren & Susannah Parsons
On February 24th, ULI San Francisco members gathered in the Tenderloin for a unique behind-the-scenes tour of one of the most significant real estate stories in San Francisco today: How one of the city’s oldest, deeply-rooted neighborhoods is rediscovering its prominence while retaining its character and diversity. Loosely defined, the Tenderloin is bounded by Market Street on the South, Geary Street on the North, and wedged in between Civic Center and Union Square. A market overview provided by commercial broker Santino DeRose, Principal of DeRose & Appelbaum, described how retailers & potential residential tenants are fast discovering the neighborhood’s exceptional proximity to employment centers surrounding Market Street, the growing amount of amenities, its walkability and transportation access. What better place to start the tour than outside the Tenderloin Museum? It chronicles and celebrates the area’s fascinating diversity of people, businesses, and rich history of arts and culture. Karen Alschuler and David Bradshaw of the architecture firm Perkins & Will— which provided pro-bono design services in the museum’s transformation last year— pointed out some details of the museum. For example, the lobby’s zinc-topped bar is reminiscent of speakeasies of an earlier era, and an illuminated map on the ceiling showcases the Tenderloin’s central location in the city.
The neighborhood “has been evolving for a number of years, across several real estate cycles,” said DeRose. “And what’s really fascinating is the mix of well‐established retail and innovative businesses, some completely new to San Francisco from other parts of the world, and choosing the Tenderloin as their first US outpost.”
He cited examples such as the tiny but popular Elephant Sushi on Geary –only the third location of a popular San Francisco-born restaurant — and Mensho Ramen, a bursting Ramen shop that had 3 locations in Japan before choosing San Francisco as their first overseas location. “They did not look in any other neighborhoods,” said DeRose. “They wanted to be in the Tenderloin and they made it very clear to us from the outset.
With a sense of the big picture and a map of retail transformations in hand, the group ambled up Leavenworth to see four properties: 540 Leavenworth, 685 Geary, 709 Geary and 676 Geary, led by Steven Thrower of Veritas Investments and David Chesnosky from its leasing unit, RentSFNow.
David Chesnosky explained the transformation of 540 Leavenworth, where an accidental fire closed the residential building. Recently re-opened, it has been brought back to life for displaced residents now able to return, as well as for new residents. A modern entry system enables residents to talk with and see their guests on their smartphones, and the periodic table-esque design of the foyer is one of many modern design elements within the 100-year-old historic building. Similar to Veritas’ other properties on Geary, 540 Leavenworth’s original brick exterior surrounds a contemporary entry gate, offering a hint of the renovated interiors.
“Once the retail community sees the type of work and vision going into these spaces, it opens the door for others,” he said. With the success of art galleries, cafés and other retail in the past three to four years, Veritas is now seeing innovative tenants such as Elephant Sushi, Rye Bar, Resolute Wine Bar, Mensho Ramen and another shop in contract — all at 685, 709, and 676 Geary.
As the tour hand-out stated, “Veritas works to stay true to a neighborhood’s historical character, retaining the architectural heritage and cherished landmarks.”
“Vibrant retail tenants play an important role in enhancing the residential and commercial …and often create a virtuous cycle, drawing foot traffic and potential residents to a neighborhood.”