Flower Mart vendors to find new home on 16th Street, replacing planned housing

A new San Francisco Flower Mart would beat out nearly 400 units of approved housing at an industrial site at the base of Potrero Hill, according to a new plan.

The developer of the San Francisco Flower Mart property in South of Market has a new scheme to relocate the flower vendors to 16th Street in Potrero, the latest twist in the saga of the city’s wholesale flower market whose current home is being redeveloped for tech office space.

On Monday, executives from Kilroy Realty Corp., the company developing the current home of the Flower Mart at Sixth and Brannan streets, announced that it had acquired a new home for the floral businesses. Kilroy paid $99 million for the property at 901 16th St. and 1200 17th St.

The property, previously home to the moving company Corovan, won city approvals in 2016 for 395 units of housing, a project that was tied up in court by opponents for three years.

While the property could provide a suitable new home for the flower vendors, housing proponents called it an example of the power neighborhood development opponents have to delay — and eventually kill altogether — much-needed housing.

“We are just starting the community process” on the Potrero Hill flower mart location, Kilroy Senior Vice President Mike Grisso said. Kilroy will meet with residents over the next few months and the new market could be ready for occupancy by 2021.

“Preserving the wholesale flower market and keeping it in San Francisco has always been the most important goal of the project,” he said.

The city approved the 395-unit Corovan development in 2016, but the neighborhood organizations Grow Potrero Responsibly and Save The Hill sued to block it. While a judge dismissed the lawsuit last summer, construction costs had jumped more than 30% during the three years it was bogged down in court, making the project no longer economically feasible, according to city officials.

Jeff Cretan, a spokesman for Mayor London Breed, said that case is “a good example of why the mayor wants to streamline housing approvals and permitting.” While he said Kilroy’s development at Sixth and Brannan is positive — it will pay $166 million in community fees, including $54 million for affordable housing — the fact that the city will get 400 fewer housing units is emblematic of systemic problems.

“It’s a unique situation, but it’s not a good thing when we obstruct and delay housing and make housing infeasible,” he said.

In a statement Grow Potrero Responsibly said having a market rather than housing would be “a win-win for both the neighborhood and the Flower Mart,” saying it would preserve working class jobs and generate less traffic than the residential development would have.

Todd David, executive director of the pro-housing group San Francisco Housing Action Coalition, called the outcome “a giant win for the NIMBYs.”

“This is what happens when people attack super responsible, desperately needed housing development,” David said. “It gets tied up in court for years at a time, costs escalate, and the project is no longer feasible.”

The question of where the Flower Mart would end up has been up for debate for seven years. Originally the vendors struck a deal with Kilroy to move into the lower floors of the proposed office complex at Sixth and Brannan, part of a rezoning meant to spur office development near the new Central SoMa subway. But that idea faded as some of the flower wholesalers worried that their noisy, truck-heavy operations might be incompatible with the vision of Central SoMa. In addition, many vendors said it would be disruptive to have to move into a temporary home while the office project was under development. Several other sites were looked at as well.

“We always understood that, realistically, the Flower Mart might not return to SoMa,” said John Elberling, executive director of Todco, a SoMa affordable housing group. “Basically, if the merchants are happy, everyone else should be happy.”

Cliff Bargar, a Potrero Hill resident and housing advocate, said he was “definitely disappointed” to see that the neighborhood would be losing the approved housing.

“I am happy for the Flower Mart but sad to hear that those units won’t get built,” he said.

J.K. Dineen is a San Francisco Chronicle staff writer. Email: jdineen@sfchronicle.com Twitter: @sfjkdineen