The city of Mountain View is poised to launch an ambitious six-year plan requiring landlords to retrofit homes at risk of collapsing in an earthquake. And while the upgrade requirement could be an expensive burden on property owners, it could also be an opportunity to add more housing units and offset the costs.
The Mountain View City Council agreed last year to pursue a mandatory retrofit program for residential buildings with a "soft story" design, which have partially open and structurally weak ground floors that put them at risk of collapse in a strong earthquake. A survey found that 488 buildings containing more than 5,000 housing units in Mountain View appear to have the faulty design.
Cost estimates for complying with the retrofit program range from $6,000 to $20,000 per unit or $25,000 to $100,000 per building, according to city staff, and it's unclear how far grants and loan assistance will go.
One way to soften the financial hit is to allow property owners to build more housing: Rather than just retrofit the ground floor for earthquake safety, landlords could convert what's often tuck-under parking and storage space into new housing units, bringing the building into compliance while adding to their rental revenue.
In 2015, the city of San Francisco passed legislation to accomplish just that, peeling away regulatory constraints to allow property owners doing mandatory seismic retrofit work to build Accessory Dwelling Units (ADUs) within the existing structure. The ordinance offers significant exceptions for the newly added units, which can exceed residential density limits, have fewer parking spaces and less private open space. The city has received hundreds of applications to add ADUs during retrofit work.
The reasons for the law are twofold. It adds a financial incentive for property owners to retrofit apartment buildings by allowing units to be built within the soft story, and the additional rent could help offset the cost of retrofitting and constructing the new units. Building an ADU adds about $50,000 when part of a soft story upgrade, according to San Francisco staff reports from 2015.
At the same time, the law also encourages housing to be built that is affordable by design -- ADUs are typically rented out below the market rate -- without any public subsidies, making it an easy way to add homes to a region grappling with a housing crisis.
Nearly all of the soft-story buildings identified in Mountain View were built between 1950 and 1980 and have parking on the ground floor, leaving one or more sides open and without a shear wall for stability. Absent a retrofit, the lateral back-and-forth motion of an earthquake puts these structures at risk of "pancaking" if the first floor collapses.
Conversion of a building's soft story into residential units should have no problems complying with the city's building and fire codes, because doing so would eliminate the vulnerable conditions of the soft story, said Shellie Woodworth, the city's chief building official. The real hurdles, she said, will be with city planning staff, who determine whether a proposal complies with parking requirements and higher intensity use of the property.
It's unclear how rent control would affect these newly added units, which would be within the existing "envelope" of older apartment buildings subject to the city's Community Stabilization and Fair Rent Act (CSFRA). The state exempts apartments first occupied after February 1995 from local rent control measures, but the units are being added to buildings that are subject to rent control.
In San Francisco, this is dealt with through a special regulatory agreement. If ADUs are constructed in a rent-controlled building and need waivers from the city's planning code and exceptions for things like density and parking, the property owner and the city could sign an agreement subjecting the new units to rent control.
Though the CSFRA exempts so-called companion units from its provisions, this specifically refers to ADUs added in single-family residential zoning district, said Emily Hislop, senior case manager with Project Sentinel. She said she does not believe an ADU constructed on the same parcel as a multi-family building falls in that category, and would likely be exempt from the city's rent control law.