Real Estate Principals Lunch Series Examines Bay Area Council’s Homelessness Report with Industry Leaders

April 15, 2019

By Todd Hankin

Homelessness in the Bay Area has reached crisis proportions. What role can the real estate sector play to help alleviate this growing problem? On March 29, 2019, EisnerAmper and the Bay Area Council co-hosted another luncheon as part of its Real Estate Principals Lunch Series, this time addressing concerns of the real estate industry regarding our region’s homelessness crisis: the causes, consequences and solutions.

The event took place just ahead of the Bay Area Council's April 2019 report on homelessness, “Bay Area Homelessness: A Regional View of a Regional Crisis,” written in conjunction with Kaiser Permanente and McKinsey & Company. Adrian Covert, Vice President of Public Policy for the Bay Area Council, shared select findings from the report:

  • West Coast metros have unique challenges when compared to other metro areas.
  • High homelessness rates magnify the public visibility of homelessness.
  • Bay Area homeless contain more chronically homeless and youth, but fewer families.
  • The Bay Area is a leader in Permanent Supportive Housing, but only shelters 33% of individuals who need support from the crisis response system.
  • The Bay Area crisis response system supports at least 49K individuals.
  • Alleviating homelessness can reduce health care, criminal justice, and behavioral health systems burdens.

Adrian led the discussion with panelists Cassandra Costello, SVP, Public Policy & Executive Programs, San Francisco Travel; John Bozeman, CAE, Director, Government and Industry Affairs, San Francisco Building Owners and Managers Association; and Gwyneth Borden, Executive Director, Golden Gate Restaurant Association. Each panelist represented a business tied closely to San Francisco’s major commercial and tourist areas where the homelessness crisis is often at its most revealing.

The discussion spanned housing costs and supply; insufficient inventory including shelters, PSH, and Rapid Re-housing; political challenges; insufficient public resources for psychiatric care; and urban development history. The panelists addressed some of the circumstances their members are dealing with when it comes to homelessness, including the responsiveness of the city of San Francisco to the concerns of their organizations.

The panel fielded questions from an audience of real estate developers, owners, operators and investors. Key points of discussion included:

  • Media headlines depict homelessness in San Francisco as a crisis for the city’s tourism industry. Yet just recently, the tourism bureau released record-breaking numbers for 2018. The panelists helped attendees understand what’s really going on.
  • Last year, Spotify, for example, left its mid-market location due to safety and quality-of-life concerns, despite having to give up its tax break. The panelists discussed whether or not the homelessness crisis is having a measurable impact on commercial real estate outside of the mid-market.
  • Mayor Breed has vowed to open more Navigation Shelters and Permanent Supportive Housing units. Many attendees witnessed how difficult this is going to be after a proposed 200-bed Navigation Center on the Embarcadero drew hundreds of opponents. The panelists addressed what role, if any, that local businesses have played in site locations for Navigation Centers.
  • The issue of site location of homelessness services always brings up fears of the “magnet effect,” where the services will attract homeless populations from other places. Based on the Bay Area Council’s research, the vast majority of homeless people are local: 90% of Bay Area homeless residents have lived in their current county for more than one year, and more than half have lived in their current county for more than 10 years. The panelists weighed in on how prevalent the magnet effect is among their constituents.
  • Many of the public policy issues surrounding homelessness (e.g., funding, psychiatric care, conservatorships) are state issues. The panelists shed light on what the state of homelessness advocacy looks like in Sacramento and whether or not local businesses are at the table.
  • Lastly, the panelists responded to questions from the audience regarding how to get involved in the conversation and help alleviate the homelessness crisis.

The Real Estate Principals Lunch Series invites industry leaders to share insight on timely topics that impact the real estate community and provides an opportunity for high-level networking and dealmaking. The next real estate luncheon will focus on the retail sector. To learn more about EisnerAmper’s upcoming real estate events, contact an EisnerAmper professional or visit EisnerAmper.com/real-estate.

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About Todd Hankin

Mr. Hankin is the Partner-in-Charge of the Audit and Assurance Practice in California and leads the firm’s West Coast Real Estate Private Equity Group. He specializes in financial services including hedge, private equity and real estate funds, registered investment advisors and commercial and consumer finance and leasing companies.

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