June 2016 – 181 Fremont Residences

What’s different?

This is a relatively small residential development on top of a big commercial office building. I am sure there are other large commercial buildings with residences in the city, but they do not readily come to mind.

181 #1

On top of 50+ floors of commercial space, there are 55 condominiums and 12 “accessory suites” on the 54th floor (think nanny or guest quarters). Owner units start on the 55th floor and go up to the 70th floor penthouse: only 2 to 4 units per floor from 55 to 69, and a full-floor unit on 70.

The 52nd floor has a fitness center, owners’ lounge, catering kitchen, conference room, etc.: no swimming pool or media room. (Mechanical on 53). Unlike other high-end developments, my sense is that potential buyers are likely transient and will not be using the property as a primary residence. Of course, I could be wrong.

The developer, Jay Paul, hired top interior designer, Orlando Diaz-Azcuy, to design unit interiors and the residential lobby. His recommended finishes and wall/floor/window coverings/recessed lighting will be installed by the developer, which is one of the reasons for lofty prices, not to mention views, location, and a limited offering.  Kudos to Heller Manus Architects for contributing a beautiful building to the skyline. BTW, the current sales center is at 101 California, 42nd floor, rather than at or near the property.



For quite some time, I have been pontificating the benefits of the Transbay Terminal (scheduled to open late 2017). The 181 Fremont development adjoins Transbay and has direct access on its 7th floor to the 5.4-acre park atop the Terminal. It’s a great location; walking distance to Moscone Center, SFMOMA, the Embarcadero and Ferry Terminal, etc.  The Terminal will include 100,000+ sq. ft. of retail space, a benefit to the neighborhood.


 HOA dues, which include earthquake insurance like the St. Regis and Four Seasons, will be a rich $2.00+/square foot/month, similar to the hotel units. Purchase contracts are available now and occupancy is scheduled for Q 3 2017. Accessory units can be purchased only by original owners but can then be resold to anyone.

My sense is that the target market for these units is the wealthy home collector who would like a special San Francisco home when he/she is in town. The location, views and finishes are quite special, and although overall market appreciation has slowed, the developer has only 55 units to sell.

Pulse of the Market – The Book

Pulse Book Image

The Pulse of the Market book (edited Pulses from 2005 to 2015) is available in paperback and Kindle at Amazon.com. It offers insights and perspectives on what has made San Francisco residential real estate tick in the past 10 years. Let me know if you would like a personal autograph.

 Please feel free to email or ring me at 415-730-7772 when you need real estate expertise.

May 2016 – If President Trump – Expected SF Changes

The Story Behind the Story

With the political season in over drive, I started thinking about possible changes that we might see were Donald J. Trump to become president.

This was going to be the April Pulse, but my daughter told me that I might insult some people. Then my good buddy and lifetime CPA called me a wuss for not publishing it (that hurt). So here we are.

Bike Lanes Re-imagined

Move over, bikers, limos only. Yes, we are due a respite from the ever-increasing number of green bike lanes throughout the city.  The green lanes will remain green. However, they will be for limousines only. Bikers will receive a $200.00 ticket if they use them.  There will be no cost to repaint lanes, and the $200.00 per ticket revenue will generate ample funds for street maintenance. Expect limo sales to soar generating even more tax revenue for city coffers. This is a win, win, win!

SFMOMA renamed

Trump Art Collection

Who needs fancy smancy art? The Trump Art Collection will be installed and SFMOMA will be renamed SFTAC. Did you know that a trademark application was filed in 2006 for the Trump Art Collection? The trademark appears to cover a slew of art-related products including, note booklets, check booklets, autograph booklets, and totally-not-out-of-date telephone booklets.

 Coit Tower Renamed

 Henceforth, Coit Tower (also known as the Lillian Coit Memorial Tower) will be renamed Trump Tower. Lillian Hitchcock Coit was a wealthy socialite who loved to chase fires in the early days of the city’s history (think 1860s). Lillian’s fortune funded the monument after her death in 1929, and one apocryphal story claims that the tower was designed to resemble a fire hose nozzle. Another more recent apocryphal story claims that Trump thought the renaming was appropriate because the tower resembled a part of his anatomy.

Palace of Fine Arts Re-imagined

 Welcome to the Mar-a-Lago Club of San Francisco. The Donald plans to buy the Palace from the City for $10 million (same as what he paid for Mar-a-Lago Palm Beach), but this being San Francisco, instead of creating a private club, it will be a public club for everyone (don’t sweat the details as to how exactly that will work). He will lease the club to the City for $1.00 a year. Think of it! Located next door to Crissy Field and the Marina Green, it will become a perfect setting for special events, holiday celebrations, weddings and galas, just like Mar-a-Lago in Palm Beach! Of course, the fees will skyrocket, but since all the public owns and belongs, who cares?

Other Expected Changes

Charlotte Schultz, long time Chief of the Mayor’s Office of Protocol will be fired. Her replacement will be Aaron Peskin. SFO International well be renamed Trump International with a special gate for Air Force One, Dogpatch will become Trump Patch, Pacific Heights will be Trump Heights, ATT Park will become Trump Park, and Twin Peaks will become Trump Peaks. Real estate values will soar!

Pulse of the Market – The Book

Pulse Book Image

The Pulse of the Market book (edited Pulses from 2005 to 2015)

is available in paperback (Kindle version a few days off) at Amazon.com. It offers some perspectives on what has made San Francisco residential real estate tick in the past 10 years. Stay tuned.

April 2016 – Flying O Ranch


 Frank Wylie, founder of Wyle Laboratories, a leading aerospace company based in Los Angeles, created Flying O Ranch in the early 1990s. The Ranch is a gated community and encompasses some 1,400 acres, subdivided into 33 parcels, each about 40 acres.

The Ranch is about six miles from Coarsegold (the closest market and shops),

30 miles north of Fresno (closest airport), 65 miles southeast of UC Merced, 12 miles south of the fairytale Chateau du Sureau Inn, and 30 miles from the southern entrance to Yosemite National Park.

The original buyers were mostly from southern and northern California. They wanted a refuge from the hectic urban experience. In some instances, they were horse people and had a desire to ride throughout the entire 1,400-acre ranch. Some constructed homes; others have kept their land unimproved.

Views of the surrounding mountains and bluffs are spectacular.

Flying O View with Mtns

Special Property Now Available

The property, 30332 Flying O Ranch Road (Parcel #7), is approximately 40 acres of natural land with great vistas and rugged, usable terrain. There are two wells on the property, along with a 600-gallon tank that holds water for the property and home. Our client purchased the land in 1998 and in 2006 built a two-bedroom/three-bath “smart” home (about 1,800+ sq. ft.). There are two attached garages.

Below is the vista from the second level dining area.

Flying O DR with view

 The Flying O Ranch parcels are quite special. When someone buys a property they are really getting use of the entire 1,400 acres of the Flying O Ranch with equestrian facilities, miles of trails, and all while living on a working cattle ranch, not to mention magical vistas and the serenity of open space.

For information on either property, please send Malcolm Kaufman at email or give him a ring (415) 730-7772, or email  Beth Carver, who resides in Bass Lakes (a lot closer than San Francisco). Beth’s phone number is (559) 658-1784.




April 2016 – The Harrison

A Little History

One-Rincon-BofA-TowerOnce upon a time in 1995, Bank of America bought the Union 76 clock tower. It had a Union 76 logo for some 50 years and stood at the foot of the Bay Bridge. After purchase, B of A installed its own logo.

Fast forward to 2003 when Mike Kriozere (Urban West Associates) purchased the property from B of A for approximately $16 million. Construction of Rincon Tower One (the South Tower) started in 2005, and initial occupancy occurred in February 2008, just in time for the Great Recession. The South Tower stands 60 stories tall, with 376 units and has a 50,000 gallon water tank on top to mitigate sway during high winds and earthquakes (just in case you are interested).

The Harrison (aka North Tower)

 Construction of The Harrison (298 units) started in October 2012 as a rental building, and the developers had the foresight to overlay a condominium map, which is something developers do quite regularly. The first residents (renters) moved into the building in August 2014. The property was sold to a new partnership in the summer of 2015.

Subsequently, the California Department of Real Estate approved the sale of the units as condominiums. As of today, all but a handful of the original renters have vacated the building, some having exercised a right-of-first-refusal to purchase.

The new developer, (Maximus Real Estate Partners- the same folks who purchased the huge Parkmerced complex) has retained Ken Fulk, interior designer and celebrity party-planner to add his special touch.

Harrison lobby

He has enhanced the interiors of the 298 units, designed a 49th floor owners-only sky lounge to be known as Uncle Harry’s, and created a two-story library (rendering shown here) that will serve as the building lobby. Uncle Harry’s and the lobby will be completed sometime in Q 3 or earlier.

While The Harrison has its own HOA, there are reciprocal agreements between it and the Tower One HOA. This means that the owners in each building can share amenities – valet parking, swimming pool, fitness center, Uncle Harry’s, etc.

In essence The Harrison is an upscale version of Rincon Hill Tower One, having a higher level of unit finishes/appliances, special concierge services, Uncle Harry’s, special library lobby, etc. and higher pricing.


As I mentioned last month, my Pulse of the Market book (edited Pulses from 2005 to 2015) is in the works: paperback and Kindle versions, and I expect publication and availability on Amazon.com in early May. It is interesting, at least to me, to see what has happened in San Francisco in the past 10 years. Stay tuned.

Please feel free to email or give me a ring (415-730-7772) when you need real estate expertise.

March 2016 – A Cold or the Flu ?

 My Question

The San Francisco residential market is not immune to what is going on in the rest of the world. The plunge in oil prices, slowdown in the Chinese economy, deflation in Japan, and strength of the U.S. dollar, to name a few issues affecting economies worldwide, have me wondering whether San Francisco residential is in the process of catching a cold or the flu.

We caught a cold in 2001 – 2003 and a bad flu in 2008 – 2011.

What I do Know

Pulse 150 - Bochy

I held an open house about a week ago, and one of the visitors started to quiz me about what was going to happen in 2016. I politely told him that I really did not know (the truth). What I wanted to say was that his questions were dumb because no one knows; not the Federal Reserve, not Wall Street’s biggest banks, not the Administration, not even Bruce Bochy (yes, I am looking forward to opening day).

Here’s what I do know. Assuming that the U.S. and California economies take a hard one to the solar plexus (a bad flu), San Francisco will suffer as well. There is no place to hide.

During the last flu, we saw prices decline by 15% to 20% over a 3 to 4 year period. This flu could be worse, or not.

On the Bright Side

If you are young and footloose like me, you might think about selling, take some profit, pay some capital gains tax, and buy another home. Interest rates are certainly attractive.

Another option – ride out the storm. While the multiple buyer types that abound in San Francisco may pull in their horns while the economy goes to the hospital, once the fever breaks, and the next up-cycle starts, all things positive about San Francisco will re-emerge and prices will again rise.

Two Announcements

First, my favorite son John Henry is moving soon to San Francisco from Newport Beach. He is a talented interior designer and has come to understand the merits of the Bay Area. Yes, another buyer in the wings.

Second, A Pulse of the Market book is in the works: paperback and Kindle versions. I spent a couple of weeks during December organizing 10 years of Pulses into four topics (what drives the SF market, the newer neighborhoods, top-end condominium buildings, and other residential issues). Then I talked to Amazon’s self-publishing arm. Stay tuned – probably ready in May.

Please feel free to mkaufman@apr.com or give me a ring (415-730-7772).

February 2016 – Central SOMA


As successful tech companies continue to grow and prosper, their office space needs to grow, not to mention their residential needs.
The City and major developers recognized this need several years ago and started laying plans for a new neighborhood (Central SOMA), one close to where these companies exist today. The soon-to-be-completed Central Subway on 4th Street will provide an important transit link.

The new neighborhood, known as Central SOMA, is taking shape at the southern/western end of the existing SOMA neighborhood.

Key Developers

There are four major developers:

 Tishman Speyer (Infinity/Lumina) has two projects. One is at 4th and Townsend where the Creamery now stands. The other is at 5th and Brannan

Kilroy Realty (333 Brannan/The Exchange) plans to develop five acres in and around the current Flower Mart – 640 Brannan at 6th

Boston Properties (Salesforce Tower) is planning a 1 million+ sq. ft. office complex at 4th & Harrison

TMG (Soma Grand/One Market) is developing 505 Brannan (the Bank of America site across from Marlowe Restaurant)

While the primary focus of these developments is new office space, some will have residential, market rate and/or affordable.

Architecturally, there is a desire is to retain the industrial/warehouse character of the neighborhood, rather than build tall glass towers, that we see in the Financial District and south of Market St. near the Transbay Terminal.


The development/build process takes time, what with EIR, Prop M limitations, entitlements, Planning Department reviews/approvals, permits, construction, etc.

Delays are inevitable, so think 2020 and later when we will see new buildings, parks, pedestrian walkways, etc.

Central SOMA is underway and its impact will be felt in neighborhoods throughout the city, just like the newer neighborhoods of Dogpatch, Shipyard, Mission Bay, South Beach, Yerba Buena are affecting residential economics across the City.
Check out PulseFactors.com for previous Pulses. Please feel free to email or give me a ring (415-730-7772).

January 2016 – No Protection


So we end the year with average prices having appreciated some 13+% over 2014. That’s on top of an average appreciation of 13+% for each of the three years from 2012 – 2014 (+40% for 3-year total). Some folks have started talking about another bubble.

Real estate prices, like the economy, are cyclical, i.e. prices go up and down, as you know. I guess the definition of a bubble is when prices get too frothy on the upside and then trigger a (dramatic) “correction” as happened in the Great Recession.

Have you seen the movie, the Big Short, based on the Michael Lewis book by the same name? I recommend you do, but be prepared to walk out somewhat depressed. There is no Hollywood happy ending here.

It is likely to happen again, as Paul Krugman points out in his recent New York Times op-ed column “The Big Short, Housing Bubbles and Retold Lies.”

The essence of his article is that many of the “runaway bankers” who reaped millions/billions by leveraging the mortgage market are at it again! They are powerful people with powerful friends in high places.

Bottom line, there is no way we can protect ourselves. While you and I may be conservative in our personal mortgage decisions, when the proverbial hits the fan, as it did in 2008, everyone gets hurt: lost homes, lost jobs, lost income, etc. you, me et al.

Yeah, we should be so be lucky!

Pulse 148 - Guardian Angel

The thesis of the book/movie and Krugman’s article is that that it will happen again!

They maintain that it has already started.

Happy New Year!

December 2015 – Are We Getting Tired?


I’ve started to see a number of price reductions: more than in previous months, and the chatter among my fellow agents is that the market is weakening. A recent article about Square’s IPO and the valuation of other unicorns got me thinking.

Is the Market Getting Tired?

Pulse 147 - Tired

We have been in an up-cycle since 2011. This is the fourth year of robust appreciation (better than 10% a year). The up-cycle from 1994 to 2000 lasted seven years and ended with the dotcom bust. The next up leg was 2004 to 2008, which ended with the Great Recession (down three+ years). We are probably closer to the end of this up-cycle than the beginning, but no one knows how close.

While the current up-leg may be getting a bit long in the tooth, my crystal ball says that it is not headed south; probably slower growth in the year ahead rather than a continuation of the double digit growth that we have seen for these last four years.

Blessed with Multiple, Diverse Buyers

San Francisco is blessed with multiple buyer groups that sustain a long-term upward trend, which is the important consideration in my real estate book.

Primary residence buyers who want to live and work in San Francisco,
Pied a terre buyers who want to partake of the City’s dining, shopping, and entertainment and are not yet ready to give up the old homestead, but do want a place in the City where they can spend weekends, etc.,
Empty-nesters who live within 100+ miles of the City, and want to enjoy the City’s vibrancy on a full time basis now that the kids are out of the house,
Investors who understand the long-term economics of San Francisco residential real estate and want to benefit financially,
Home collectors who want a place in San Francisco, Chicago, New York, etc.

We are indeed blessed.


Even though our residential real estate benefits from multiple buyer groups (read five legs to the stool) and sustains a vibrant market over the long-term, changing market psychology also plays a role, and contributes to mini cycles within the long term upward trend.

Square had its IPO on November 19 at an offer price of $9.00 a share, which was 50% less than its most recent private financing a year ago. I’ve read that major mutual funds, ones who have been investors in start-ups over the past decade, have started to mark down valuations of some of their private company holdings.

Question – is the bloom off high tech stocks? Is this issue contributing to changing (short-term) real estate psychology? My monthly numbers don’t indicate any drop-off in appreciation (we are up some 13.5% over last year through the end of November). Given where we are in the cycle, it would seem that an easing of the heady 10%+/year appreciation rate is coming to an end, though I know not when.

But, as I have said many times, it doesn’t matter, since it’s about the long game that makes San Francisco residential real estate attractive.

Check out PulseFactors.com for previous Pulses. Please feel free to email or give me a ring (415-730-7772).

November 2015 – What’s the Square Footage?


Why do Buyers and Sellers ask this question? What difference does it make? Are they concerned about paying too much on a per square basis if they are buying or too low if selling? I thought I would discourse a bit on one of my favorite non-subjects. I’ll focus on condominiums since I become even more agitated when people use dollars/square foot when discussing the value of single-family homes.

What Matters

Does it matter that the average price per square foot in San Francisco has risen from $625/sq. ft. to $1,000/sq. ft. or that the average price of a condominium during the same period rose from $750,000 to $1,250,000? When you go to a bank and ask for a loan, the bank will look at loan to value (say 80% of $1,250,000), right? The bank is not focused on $/sq. ft. nor is its loan appraiser when he/she does comps, although it may be a consideration.

Pulse 146 - Matters

Would you rather pay $1,300,000 for a 900 sq. ft. unit with the layout/outlooks/amenities you like in a building in a good location that serves your needs or $950,000 for a 1,000 sq. ft. unit that has less of all of the above? You get my drift.

Why the Question?

This is a bit cynical, but I think many people ask the question about $/sq. ft. because they want to look knowledgeable about real estate, and/or it is a question that can fill a void when they may have asked all their other questions.

Pulse 146 - question

Developers (justifiably) use the $/sq. ft. metric to help them understand their construction costs, financing, marketing, and other soft costs, as well as their projected revenues. It makes for a very tidy model.

I recently listed a property, and in filling out the MLS information query, I was asked to enter the approximate square footage. At about the same time, a fellow agent pointed out that the sq. ft. numbers for recent sales in the building were suspect. Knowing that there has been quite a bit of litigation in recent years over sq. ft. measurements, I opted to exclude any reference to square footage in the MLS altogether. Let the buyers figure it out for themselves.

If you ask a contractor, architect, and appraiser to measure a particular unit, I submit that they will come up with three different numbers. One might measure from interior-to-interior wall, exterior-to-exterior wall, inside closets, decks, etc. Each will have his/her way of measuring, and they might vary by 10% or more.


I am comfortable using $/sq. ft. to see whether the property is in the “ballpark of reason.” I prefer paying $1,500/sq. ft. for a condominium that fits my needs rather than $900/sq. ft. for one that doesn’t. It’s as simple as that.

Check out PulseFactors for previous Pulses. Please feel free to email or give me a ring (415-730-7772).

October 2015 – Transformation

Pulse 145 - transformation

There seems to be a clamor among the natives that all the construction in the City is creating monumental traffic gridlock, displacing people, and changing the face of our fair City (read – transformation).

Been There

Moscone Center, named for the murdered (in 1978) Mayor Moscone and built in 1981, was initially opposed by Moscone when he served on the Board of Supervisors in the 1960s. He felt it would “displace elderly and poor residents of the area.” It has since transformed the surrounding neighborhoods.

In 1997, UC Regents approved Mission Bay as the site for UCSF’s new campus, and with Mayor Willie Brown’s help, Catellus Development Corporation was “encouraged” to donate 43 acres of property to UCSF Mission Bay. It transformed Mission Bay into a home to many of the most advanced research facilities in the world, not to mention new housing.

Then ATT Park opened in March 2000, and besides bringing three World Series championships to the City (read – economic benefits), it transformed all of King Street and multiple blocks to the north with new housing, retail and commercial buildings.

Population growth

The City is going through a growth spurt, which it does now and then. The City’s population stood at 803,000+ in 2010, having grown an average of 2,800 people a year from 2000.

Since 2000, the growth has been an average 4,000 people a year, but lately it has been growing at the rate of 10,000 people per year! San Francisco is the Bay Area’s densest city and one of the densest in the country.

What’s On Tap?

At least eight major developments are in the works, and each of them will have a dramatic, transformative impact on their respective neighborhoods and probably the City as a whole.

1. Transbay Terminal – Downtown
2. Warriors Arena – Mission Bay
3. Pier 70 – Dogpatch
4. 5 M – 5th and Mission Streets
5. CPMC – Van Ness/Russian Hill/Lower Pacific Heights
6. Sea Wall Lot 337 – Mission Bay
7. Treasure Island – You pick it
8. Shipyard – Bayview/Hunters Point


Yes, the City is changing, and the old refrain about displacing the elderly and poor is once again front and center. I share these concerns, and I wish I could contribute to the solution. Mayor Lee spoke at the recent Structures event hosted by the Business Times. I sense that he is not only empathetic to displacement, but has the vision, will, and political support to lessen the impact of these major developments.

Urbanization is happening all over the world. Cities are becoming denser, and San Francisco is no exception. In 2000, we may have been a quaint city of 775,000 souls. By 2030, we will likely be a robust 1,000,000.

Please feel free to email or give me a ring (415-730-7772).