be disappointed if they lack the freedom to socialize over the consumption and we should destigmatize cannabis consumption. preventing legal consumption lounges is not a situation that creates a welcoming environment so many users consume in public. state law requires cannabis to be used in private yet many consumers, including tourists and renters in smoke free buildings have no place to use cannabis products. and san francisco is and always has been a trailblazer and trend-setter. the city is setting the bar for what cannabis consumption can be like, and other cities are hoping to follow in its footsteps. please allow the people that live in and visit this city to have more places to go like the proposed consumption lounges. and thank you again for the time to discuss this very important matter. lastly, my name is eric post, and i'll be part of the management team on union station of my thank you for your time. >> thank you.

any other public comment on this item? okay. with that, public comment is closed. commission koppel. >> it's a thrill to see city kids opening up businesses in the city. supported by other city kids. [applause] >> there's no clapping. i know everybody's happy but -- [laughter] >> also incredibly impressed with the outreach the project sponsor did with united save the mission, hence them being here supporting. and also the conditions they did agree to, we really hold in high value. so i really appreciate the project sponsor working diligently with the community. i really respect that the sponsor has prior experience working in the neighborhood. obviously very overwhelming

neighborhood support, filling in a vacant storefront. the nearby businesses are going to get busier. there's going to be more people. people are going to be happier. i'm highly supportive. i would like to see what other commissioners say. >> thank you. commissioner richards. >> so i accompany commissioner koppel and a few of the folks in the room here too. the proposed site and really got a sense of the genuineness of the act of them wanting to integrate in the community. rick hall gets up here and tells us that they get an a plus and three gold stars for all the stuff they've agreed to. that says a lot to me. one other thing, i walked by hybrid gym all the time and said i was going to join and it's no longer there so if you put a hybrid gym in i'll come and do cannabis and do some boxing. i move to approve. >> second. >> commissioner fung.

>> question for staff. what are the uses of the floors above this space? i believe two floors. >> the upper floors are occupied by arts activity uses. it's i believe a community space. >> both floors are community space? >> there's no residential uses above. >> i'm saying both floors are community space? >> that's my understanding, yes. >> commissioner diamond. >> staff recommendation to approve but without the lounge? >> yes. so staff's initial recommendation was for approval with a condition of approval which is still in your packet which would prohibit on-site consumption. our policy for where to allow on-site consumption is something we are still developing and learning over time, particularly

in the mission district, working with our community partners, we have learned a lot that although we do want to encourage a regional corridor that preserves the retail uses and discourages destination retail which might force out those types of uses, consumption lounge may be desirable in the sense because there are a lot of persons who live in the area who lack any legal place to otherwise consume cannabis, even for medicinal purpose, particularly residents of s.r. o. hotels. >> so are you changing your recommendation? >> sounds like it. >> i defer to the commission. >> i'm sorry. can you please be clearer? what is the motion written? what are you asking us? to change what you have written? >> yes. for the draft motion from july contains that condition of approval. if the commission would like to

allow on-site consumption and remove that, i would ask for approval motion which specifically removes condition number 11. >> okay. so there's a motion that's been made already. who made the motion? okay. what do you say? >> as i said at the cannabis retail castro and market, the neighbors will be complaining if people go out in the plaza and start smoking. they wanted to have an in the place consumption. this is an enormous space. if we let people -- don't let people consume on-site, they are going to go into the plaza, the bart station, we are going to hear more complaints so i think it makes an incredible amount of sense to let people smoke in the building if they would like to. >> okay. >> i could support the retail function but i can't support the on-site consumption. >> commissioner richards, did you already -- okay. >> my motion is to strike number level from the conditions >> and you seconded it?

commissioner moore. >> we had to ask for guidance about the general attitude for on-site consumption, i can only listen to the community voice and the community itself takes responsibility of how this is handled. in this particular case, given the number of s.r. o.s and smaller units in which rental wouldn't allow on-site, this may be just a trial case to see how that works. >> okay. >> there's nothing further, there's a motion to approve this matter with conditions as have been amended eliminating condition 11. on that motion ---[roll call vote] >> that motion passes 5-1 with commissioner fung voting against. >> we still have a bunch of

business. sorry. so if we could -- be quiet. >> commissioners -- that will place us on item 15 for case number 2016, a conditional use authorization.

. . . . the project includes interior tenant improvements, store front changes on geary street as i approved under the minor permit author and street access to the third and fourth floors. the department recommend approval with conditions for the following reasons.

the project is converting less than 50% gross square feet of the building to office use. it does not displace an existing tenant and rehabilitating a vacant building. the remaining retail use wills remain an active store front presence such as visible along geary street and maiden lane that will support commercial uses in a commercial neighborhood. on balance t project is consistent with the objectives and policies of the general plan. the department also finds the plan to be necessary, desirable and come patable with the surrounding -- and compatible with the surrounding neighborhood. i am available for questions and the project sponsor is here to present their proposal and answer any questions. thank you. >> vice president melgar: thank you very much. do we have a project sponsor? i think with edo. so i see mr. hapner here from supervisor peskin's office. do you want to speak? >> thank you, commissioners.

pardon, i am privy to late coming information and ran up here. wasn't expecting to speak on this today. of course, it is our office's prerogative not to wade into the for or against on conditional use applications because they may be appealed to the board of supervisors. that said, there was an article that came to our attention a couple of hours ago, and about a disagreement in this part of the district where it appears that the proprietors of 146 geary who are here today and i was speaking with out front have requested d.r. of a retail cannabis use on the ground floor next door. and further, there is apparently a desire on behalf of the business improvement district to craft the luxury retail zone, and we want to know what that is. we have never heard of that either. we were so proud of the c3r legislation premised in large part on representations from property owners that retail is

not a viable use on the upper floors in union square, and that, frankly, even on the ground floor there have been store front vacancy issues throughout union square, and that has informed a lot of our thinking and policymaking around this. and it's i think worthy of additional analysis by the planning staff in context of this application which is saying that retail is not viable here if the proprietor is simultaneously seeking to interfere in the activation of a neighboring store front. and i say that with very limited information and with all due respect to the project sponsor at 146 geary who collaborated with us in the creation of the c3r legislation which forms the basis of this application, but in light of that new information, i just do want to request a brief continuance to allow planning staff to analyze thats fa et of the issue. thank you. >> when do you want to continue this to? how long would you need?

>> i don't think it needs to be a lengthy continuance, but i pose that question to staff and staff's ability to analyze this issue. if it's one week, that is fine. if it's longer than that, and that is what it takes, that is fine. but i would defer to staff. >> would a one-week continuance be doable? no? so for the project sponsor, whenever a supervisor requests a continuance on a project, we always, you know, defer to them. so how long do you think we would need to study this issue? >> given the holidays and with the current calendar, i think the second week in january, is that right, jonas? >> well, i mean -- >> and at least in january -- >> certainly up to the commission to open up any of their hearings, but right now the first open hearing is the 16th. >> i think with the holidays and with the amount of work involved, it needs to be more than a week or two.

>> okay. this is a late request coming. do we have to vote on the request? because -- >> vote to continue. >> commissioner fung. >> i think the two issues are separate. i am not supportive of a continuance. >> commissioner moore? >> request continuance. >> a we should continue taking public comment since we have called up the matter. >> okay. >> okay. i'm sorry. and i think that we will take up the matter of continuance because we had already heard the staff start. >> sure. >> is that okay? >> to take up the matter of the continuance? >> fk o of course, please. >> this wasn't introduced as a continuance matter b u the project was called out. >> members of the public should be allowed to speak to it. >> thank you. >> i think we can continue to

hear it. and then we will take up the matter of the continuance -- thank you. >> yes. if the project sponsor could -- >> great. thank you. so it was exactly a year ago when this commission heard the first union square retail to office legislation that was proposed by supervisor peskin. many of us worked very closely with supervisor peskin and we really appreciated the willingness to work with a lot of stakeholders to come up with controls that i a achieve a common goal. much of the discussion a year ago focused on third floor uses and finding the right balance between retail and office uses. and coming up with controls that allow for an appropriate mix while still being supportive of the primary retail function. we do believe that this project satisfies the five factors and

criteria that came out of that legislation. however, i am going to let the project sponsor mr. steffen speak and address what just came up as well since i have a feeling we are heading towards a continuance. mr. steffen. >> thank you. >> good evening, i think it is. i am mark steffen with realty partners and before i talk about the presentation on this project, i would like to talk about the issue that lee brought up. our concern initially was generated from other high-end retailers that were concerned about what that might due to the street. but as we've listened to the presentation that was just ahead of us, we don't really have a problem, and if it -- we would be willing to pull our d.r. on the use next door. that is not an important issue to us. we think that it probably will

help to activate the streets and quite frankly, that is the most important concern that i have about union square is activating streets and providing more security. and i think they would do that. so before stopping the presentation, i want to say that we would pull the d.r. on 152. so now i would like to talk about the presentation relative to the conditional use application. i have been involved in retail real estate around union square for over 25 years, having invested and developed 10 buildings. i have also been involved in retail around the country. and i want to tell you that what we're seeing right now is not a cycle change. it's a structural change, and i am sure you are aware and seen the retailers and the retailers are shrinking the footprint and it is not the large department stores but even tenants that used to be 5,000 feet are shrinking to 1,000 feet and trying to deal with how to market the goods online and cross market both aspects.

it has had a very structural change and quite frankly t vacancy rate at union square is the lowest that i have seen in 25 -- excuse me t highest in 25 years of business in union square. this -- there is, as we all know, a lot of vacancies that are happening. barney's is going to close, forever 21 is closing, williams sonoma and the multi-floor retailers are going out of business and those are the only ones that can occupy the upper floors. they are just not there. we have been marketing 146 geary for four years and talking to tenants initially to take the entire building because that works the best for us. that is what was there. we said somebody take three floors, two floors, one floor, and we haven't found a single tenant that we can get to take that building. so we're concerned, as i said before, about that space

remaining vacant on the upper floors because we want to activate maiden lane and provide more shoppers for the existing retailers and more security and bodies on the street to encourage more customers to come to union square. i would answer any other questions you might have and appreciate your consideration. >> okay. thank you very much. we will take public comment on this item. >> good evening, planning commissioners. i am karen flood, the executive director of the union square business improvement district and we are here to speak in favor of the project, 146 geary. the project sponsor did come before one of the board committees to present the project and it was received very favorably from that committee. as mark mentioned, retail is really changing and of course, union square is a shopping district, but people's habits are changing and shopping online and the big shopping centers are not coming to union center and

there is less, less demand for retail. they are certainly not going to the upper floors. what we would like to see in union square is the spaces are filled whether it's office that bring tenants and people that will come and shop in our shops and eat in our restaurants and frequent our businesses. that is what is really most important to us. and as a side note with regard to the chronicle article this morning, with regard to the luxury zone, it is something that the business improvement district came up with. it is not sanctioned by the city. we look at union square and within the 30 blocks, there is some different areas. value retail on powell. more luxury retail on grant and geary. and we came up with the full cannabis policy about what are the criteria we evaluate with cannabis retailers at union square including security and how responsible the operator is including how much they're going to sprord the b.i.d. and what we are trying to do down there and that support and whether or not

they can contribute positively to the block and to the area and whether they are received by the stakeholders on the block. and if there are multiple residents that are opposed, we're going to back those residents. with regard to this, we are strongly in support. we hope it will move forward and not be delayed. thank you. >> thank you. next speaker please. >> the value of -- sue hester. the value that is being create bid your motion is going to go to the land ward. and they have to have an obligation to light the streets. planning department staff doesn't pay full attention to this issue, and the plans have to require they honor to maintain lighting permanently. two speakers before me spoke

about the high level of va can sis. whenever there is a vacancy, the street gets dark because there is no lights coming onto the street from the retail establishment, which is why the obligation can't be put on the retailer establishment and has to be done permanently and looking at a quadrant leader to tell the planners you have to do this. you have to go over the plans for the building. you are creating value for the building owner. the building owner has to maintain lighting permanently on the street to make it safe, to make it more attractive to rent out the space. we are creating dead zones unintentionally on ground floors. we can't do that. that's your job. that is a planning commission's job. you have the conditional use

before you. you have to add a conditional use exhibit b requirement that there be adequate lighting on the street. and people need to pay attention to it at the planning staff level. really. i'm tired of trying to review plans to see what the level of lighting is. it's not good in downtown area. thank you. >> thank you very much, ms. hester. any other public comment on this item? >> hello. charmin spector, legacy business in downtown san francisco, as previous owners of 146 geary, i would like to lend support to the the project to have office space on the upper floors. i feel that it would be more beneficial to have more people

at least in the area and we have experienced a radical shift in the retail momentum and i do hope that it will swing back, but a lot of that has to do with having people as a critical force down there to try to encourage more businesses to come down to downtown and not be so stepped back from it. we really have created a vacuum in the last two years. it's been devastating. and there must be a way with the help of the bid and the help of the landlords to try to make it the shopping center and destination that it always has been and deserves to be for our lovely small city. thank you. >> thank you. any other public comment on this item? >> hello, commissioners. richard lee from crushman wakefield. i am a stakeholder in union square. i am a member of the union square b.i.d. whom you heard from ms. flood. mr. steffen has a strong point and talks about upper floor

vacancies and retail users. i actually oversee the property on post street where the former gump's is and i am the owner and gump's december 31, 2018 after filing bankruptcy. after 150 years on post street. that is a long time. so regardless, they vacated and left a large hole in the middle of post street. and that happens to be right next door to the new britex store, so if it were not for the top two floors of being an office building, that building would be completely dark. there is only lights on two floors. thankfully for the upper floor tenants. now, if you are walking down post street, you will understand what i mean. it's not that robust. so mr. steffen brings up a good point. i ament a member of the

international council of shopping centers and if i can post this up somehow, i will do that. it is a monthly magazine and it talks about retail. i receive this every month. and i am not an expert in retail, but i'm in it every day. so with that in mind, this is a sample magazine and may not talk about transitions to offices to upper floors to office use, but it really talks about the changing shift of consumer habits. and that was mentioned earlier. and that is why i am here. i am on post street and i'm fairly active, so i will ask for your support on reconsidering this and you will hear from me for the next one, 220 post as well. thank you. >> thank you. any other public comment on this item? >> with that, public comment is closed. >> commissioner richards.

>> having heard the project sponsor say the cannabis dispensary is not an issue, cannabis retail is not an issue, is your office still requesting a continuance? >> yes, and we don't mind if it's a very brief continuance. i think that we would be fine if it was probably just a week. with all due respect to planning staff to analyze the issue, i did speak to supervisor peskin just outside who said that he was about the concept of a luxury retail zone. and that it might help all parties agree if we figure this out and just give it one week for that to take place. >> thank you. >> i'm sorry. >> move to continue one week. >> u a second. >> commissioner koppel? >> that was it. >> okay. >> there is nothing further, commissioners. there is a motion to continue to

december 12. on that motion, commissioner diamond? commissioner fung? >> aye. >> a commissioner moore? >> aye. >> commissioner richards. >> u a commissioner melgar? >> that motion passes unanimously 6-0. that places us on item 26 for 2017-014849cua, 220 post street. initial use authorization. good evening, president melgar and planning commissioners. jonathan vimmer, planning staff. the application is a request for a conditional use authorization for the property located at 220 post street. which is developed with the five-story over basement commercial building completed in 1907 that is historically been fully occupied by retail sales and service uses. as proposed t project would convert an approximate 18,525 square feet of retail space to floors three through five from retail to general office use. the department recognizes the

change in retail environment, particularly when it comes to large department stores and vertically oriented shopping centers. the staff fully supports conversion to floor four and five but not at the use of the third level. such a conversion will result in the majority of the building located in the downtown retail zoning district being utilized for office space and set a precedent for like conversions of the numerous similarly scaled buildings within the area. located downtown and more specifically a block from union square, the department further finds the categories of retail sales and service use remain that could occupy the third floor of the subject property and maintain the role as a retail site with the shopper retails and direct consumer services. the department has received three letters in support of the full proposal and in addition to those included in the sponsor's packet or brief with the project sponsor -- yeah, having gathered additional signatures and

letters in support in their submittal. this concludes my presentation. the project sponsor is in attendance and wishes to provide their own. i am happy to answer any questions you may have. thank you. >> thank you, jonathan. hello. >> could we kindly get 10 minutes to kind of go through a little bit? thank you. >> representing the project sponsor, so for 220 post, they are requesting conversion of the third, fourth, and fifth floors. each floor is about 6,175 square feet. the building has a mid block, approximately 50 feet frontage on post. and then the secondary facade facing hampton place. and the building has now been vacant for over three year. we look at multi-story buildings and it's extremely difficult to find a retailer who is interested in taking a third floor or higher floor in addition to taking the first and second floor. the other option would be to

look at leasing it to stand alone and therefore, to a third retailer, but that requires for the building to have excellent access and visibility especially from the pedestrian perspective, which in the case of smaller buildings is a tough ask. so what we don't want to do is we don't want to jeopardize the primary retail facade which in this case is post street, and thus t access to the upper floors has to be off campton place in this case. we are not proposing any changes to the primary street facade and when we look at the maiden street facade and if i could have it on the overhead, here you see the existing versus proposed. the existing is currently a rather solid, noninviting and nontransparent facade. it has been approved already for a more transparent pedestrian parenedly lobby that also provides -- lob lu that provides access to stair and elevator.

however, you could easily convert this into a retail use if you ever were in a situation where the retail was viable again. what you don't see in the images, however s compton place with this block is essentially a narrow alley that is improved with back of house entries and no one is going to wonder off compton place in searchover stand alone upper floor retail. it doesn't have a lot of pedestrian foot traffic or the appeal, and on the overhead again, here are images that show the alley in both directions from 220 post. the likelihood that a retail business would want a stand alone third floor office space that is accessible from an alley that provides minimal foot traffic, marginal street visibility and has some security issues is in our opinion simply less than minuscule. on the overhead, i want to post one more image which is looking

at the alley from grant street and if you see the orange box, that is where the third floor business is. pretty tough to see. pretty unvisible. so with all that said, nothing prevents the third floor and the upper floors being turned back into retail if at some future point that becomes viable. project does not include any physical changes that would preclude that, so i am going to let the project sponsor speak about the actual efforts to lease this building, but before i go, in your packet, you have support letters that collectively include 41 signatures in support of the project including a leter from members of the street building at 210 post which includes 33 signatures representing 18 different businesses. i will turn it over to mark. >> thank you. 220 post, we have been marketing that building for three years.

and we have been talking to tenants both retail, quasi-retail, and even office subject to a conditional use permit. and we found no taker. we talked to prada, lulu lemon, lewis vuitton, maz ratry, ralph lauren, tesla, and we talked to probably 100 tenants and not anyone that would take the upper floor spaces. and in fact, what we foresee happening is that we're going to have to because the second floor can't be converted to office, we have a 50 foot store front and we will have to carve out an entrance for the second level to get up to the second level off post street. and to carve out three entrances on that, none of them will be viable and give enough identity for the amount of space. the floor plates are a little over 6,000 feet. on the third floor t quasi-retail are not 6,000 feet

useers. at best they are maybe 1,000 and mid block with windows just on the north and south which if we try to break up user, users with no window, no light, no air, and i don't want to rent space to people who don't have light and air. the other thing is i can tell you that we talk about economics, and the rents have on the retail areas in the streets are down probably almost 30% around union square just to signify the structural change and that is on the ground floor i am talking about. we tried. we don't have anybody interested in leasing this building. and i have seen this not just in san francisco, but in los angeles and new york and miami. it's a global phenomena, really. and appreciate your listening to our concerning and are here to answer any questions. >> thank you. we will now take public comment.

i feel like it's the same cast, same call. >> very supportive of this project as well for similar reasons as 146. again, we want to fill the upper floors. and bring people downtown and that will frequent the businesses and bring vibrancy to union square. we are particularly excited about proposing an entrance on compton place and we have been trying to activate that alley for a long time with art and two different grants to put art on the back streets and food and entertainment down there with the possibility of another entrance down there would really contribute to the vitality. very much in support. thank you. >> next speaker please. >> richard lee and this is a different spin. i am actually representing

owners on each side of 220 post. compton alley that is not very pretty. there is no foot traffic and the foot traffic that is there is undesirable. it hasn't gotten better in the last 10 years and actually gotten worse. the proposal is a very transformative proposal that is very welcoming and just look at the signatures. there is quite a few signatures. and back to the project and approach often. and i am on each side. this is awful. and what will happen here? is anyone coming? mr. sfeffen expressed to you there is no takeers. and i don't know what to say because i am not from mr. steffen's office, but all i say is let's cross your fingers and

see what happens. and it's been about five years since saks fifth avenue for men vacated 220 post and he already explained to you it's never been the same. >> and is another year and talking 2020. and feel like that is my property. take that and following up what is happening closely and internationally and not just union street. and rates have come down. and information on that and i don't need to see much more. >> and there is no question about it. and also contributes to the city coffers and occupancy tax and with occupancy, the landlords hopefully can start playing the property taxes on time and

basically it's not just money, but there is foot traffic and lights. and ms. hester talks about lighting. >> and he made it and --. >> thank you. next speaker, please. >> sue hester, i was hoping that he would make me happy by talking about the abundance of lighting in the building. and so he didn't make me happy. 2 the building owner by compton

street as well as post street. and dark alleys are a problem. and they are unsafe and people don't want to wonder down them. if they feel safe and i am sure you do as well. the building owner, not the tenants, has to provide these conditions. and you are giving the value a lot of value when you are declining market and prices for retail and exploding increase in presents for offices. owners are evaluated by rent entitlement. the owner will have the benefit

and should have the obligation in perpetuity for lighting the street and the planers should go over the plans and make sure they are part of the plans and the supervisor should as well. >> thank you. any other public comment on this item? >> this issue with the retail disappearing is going to get worse and worse and seeing formula retail vacating very come innocent spaces and that is a huge sign to me that business is not looking good. near my office the g.m.c. and a see's candy with huge parking lots literally went out of businesses and vacated the premises and next to a starbucks that also vacated.

i respect this is a five-story building and the recommendation may not be to take over half of the building, but i literally don't see an opportunity for the even three floors to be rented. the 6x6 center literally still completely vacant as far as retail goes, and that is a huge, huge building on fifth and market primetime. i would be in support of giving -- i never want to take away the first and second stories. i will give you that every single day of the year, but i don't see the places getting rented out by retail. i would be supportive of granting the third, fourth, and fifth story with the other condition of installing the lighting in the rear alley. >> commissioner moore. >> we are just experiments with

the perception of the retail square and the office and i would like to keep a balance and i do strongly support the department's analysis that no building should be more than 40% of office at this time at least. we can change that policy if the policy and sitting there and that only candidates like chanel and the highest end stores are being considered to occupy the spaces. i don't think that bodes very well for how we look at more inclusive offering of retail spaces in downtown. so i personally would at this moment be very measured in my support for office. i do believe we have created a strong legislation that is balanced are the objectives. my recommendation stands with the department and i can only

support two floors. again, there are other opportunities to revisit this after a while. we have many buildings which will try the same and plenty of space becoming available and i believe in looking at it in a measured way. >> thank you. commissioner diamond? >> could either staff or the project po point explain in more detail why you can't do a retail entrance and why it has to be three individual entrances as opposed to combining them? >> to make it viable, tenants want their store front identity and is all about identity. the minimum size is 25 feet of width to have the store front and attract customers and for a larger floor plate, they want a larger identity to signify it is a larger space inside. if your idea is to have unelevator up to the second and third, it is not individually

branded and most of the tenants want more branding to show off the wares. beyond that, second floor and we might do an escalator because it is a direct access. and put an elevator to the third floor is longer. beyond that, it is going to be tough to rent the second floor. we have been trying to lease just the second floor at 146 and 220. we don't have any takers. we tried that. and to speak to ms. moore's comment, we have talked to promotional retailers, to discount retailers. we talked to the real real and they are selling secondary merchandise. and we talked to everyone about this. we're inclusive. anybody wants to rent, we are happy to went, but the vn identity and not a lot of 6,000 foot tenants. that is the real problem, retail tenants. it is hard to find 6,000 foot tenants on the ground floor, let

alone the second. customers are lazy basically. they don't want to go upstairs. >> if i could speak to that and there is a misunderstanding that we are requesting we have retail and there are other opportunities for retail services. as long as you are open to the public, that is a permitted use and would not require a conditional use authorization. >> i did see that in the staff report and cure i don't say about the viability of the compton place entrance for that kind of retail. >> i think it's a through property, and so it's -- i am not sure why they are choosing just to have the compton place entry. that is property owner's decision. i am not sure what is behind that and what is driving that. >> i am a little confused. how would you see people getting to the third floor? >> it is a through lot and

extensive work being done on the building. >> and entry off post street. >> thank you. >> commissioner richards. >> i guess when i want of the third floor of hair salons and are destination places because people have the favorite hairdresser or whatever. i think people have the destination places that could be suitable for a third floor and you go and have your color done every month and favorite barber and hair stylist. i think i like the measured approach. let's go with the upper two floors and see if we get a taker that is not prada or somebody who would probably never want that space and market to, like staff said, something that is open to the public that actually

would be needed. i don't know what the concentration of hair salons is and just picking on -- >> what is that? >> there is one hair salon in town now that is about 10,000 feet at 77 main lane. and almost all the rest of them are 2,000 feet and about 6,000 feet is a really large hair salon. >> so one of the things that we keep telling new project sponsors when they come with new buildings is you will have to start thinking in smaller increments. >> the problem with that is that this building is mid block. and it has windows just on the north and south. so divide that into smaller increments, some of the tenants won't have access to light. >> so you have 3,000 square feet. which is still larger than most of the useers. i don't want to put somebody in a space where they don't have windows. >> commissioner moore.

>> i still see jewelry appraisal, watch repair, and that can be downtown using the spaces and kind of like the third floor retail culture of pedestrian which i would like to keep concentrated in downtown to such time. >> commissioner koppel? >> i have to disagree and this landlord has been trying to rent the space for three years. i don't think it's going to fill up. commissioner richards. >> when my swiss walk breaks, i go to a building on the ninth floor and half the building seems empty. mr. seuss is probably 85. i don't know if there will be a son of mr. seuss. but i don't see 6,000 square foot spot even though i would

like watch repair and i don't see a bazaar where you have little offices because a watch repair and the office is like 100 square feet. it is tiny. so there is kind of an al ba tros. and a good job about the less than minuscule chance for the third floor. i am going to support on this specific property to allow the office use on that third floor. >> commissioner koppel, did you want to say anything? >> just quick. >> that is also taking into consideration the third block and to aprooef three and four and five with the condition to taud expeer yor lighting in the back alley.

and -- with the exterior. >> i wanted to speak to the lighting question. i apologize to ms. hester for not going over this. this is approved by the historic design commission and on compton place it shows 15 to 20 light fixtures on the soffit and this is a recessed store front and to span that width. and with the plan from that clarification. is this truly an albatross because of the configuration of the building or is this going to set a precedent for future building? >> an i currently have probably six additional applications to convert at the third floor to office and they are all generally coworking spaces and i think this is a trend. i think this is a precedent.

i think that this -- i would -- i am not saying that we should keep everything vacant and there are a lot of different factors that are playing into the vacancies in downtown. and there is a lot that is going on. and the square footage that office space demands is much too precious, and that will never go back to retail. >> so i'm not quite ready to let go of the third floor retail. i am not convinced. last year a presentation and before i take that plunge which

will waive the way, i need to see hard data accompanied by the price per square foot that is being requested. and what can be supported by different the hair salon and maybe restaurant and there cease so many things that i would need to see some data on. so i am ready to vote on the staff recommendation and approve it on the fourth and fifth floor. however, since we know that there is high demand for co-working space and that it is not just in union square but adjacent chinatown, and i am really worried about doing this lightly without any hard data. so that's where i would fall. >> we are not making the recommendations lightly. we like to have data to back it up and at that time the data was

showing a demand for retail and a matter of getting education out there about what types of retail is permitted. it is not just selling shoes --. >> i would make a plug and to have to revisit that site and to get new updates and the world of co-working space has exploded since she was here. i am interested in that. and i also realize that as commissioner koppel that has spated the world of retail has dramatically changed. it is perhaps not a world where saks fifth avenue took up all six floors. but what is the new world? i am not sure that i understand that. and yet i am not ready to say

turn it all into office because we know that we can rent that out. that has profound repercussions for union square and chinatown. >> a commissioner diamond. >> i am really sympathetic to the arguments that the project proponent made, but i am really uncomfortable doing this as a one off and this feels like we need study and to apply in it a fair handed way. i did read that report and it may be dated and that different recommendations are in order, but i am really sympathetic to that argument. >> commissioner, there is a motion, but did not hear a second. >> u a didn't you second it? >> i did. >> very good.

>> shall i call the question? >> very good. commissioners, there is a motion that has been seconded to approve with conditions amending the conversion to allow it on floors three, four, and five. also requiring back alley exterior lighting. on that motion, commissioner diamond. >> no. >> commissioner fung. >> no. >> u a commissioner moore. >> no. >> u a commissioner richards. >> no. >> commission president melgar. >> no. >> that motion fails 2-4 with commissions diamond, fung, moore, and melgar voting against. is there an alternate motion? >> commissioner diamond. >> i would like to make a motion to approve the project as recommended by staff. >> second. >> very good, commissioners. there is a motion that has been to approve the project with conditions as recommended by staff. commissioner diamond?

>> aye. >> u a commissioner fung? >> aye. >> u a commissioner moore? >> aye. >> commissioner richards? >> aye. >> commissioner koppel. >> no. >> that motions passes 5-1 with commissioner koppel voting against. that will place us on item 17 for 2018-007267ofa that is an office development authorization. >> good afternoon, or good evening president melgar and member bs of planning commission. before you is a request for an office allegation from the office development limit authorizing up to 49,999 square feet of general office use. i would like to submit a revised motion for the for the record and looks like changes to clean up language pertaining to sponsor's contact, parking, and the recording of permit a and drawings. i have hard copies on hand and happy to go over the specifics

if desired. the project 865 market street is at the southeast corner situated within the c3r zoning district three blocksout of union square with the distinct portion of the larger westfield center completed in 1988, this specific portion of it. the proposed project will convert 49,999 of existing retail, accessory office, and miscellaneous space at floors 7-# with the entry along the ground floor at # fifth street. exterior work having been done by the historic planning commission due to the location and article 11kearny-market. mason-suter conservation district. and this includes replacing bronze sconces with glazed

skwonss. it would add class one and two biking and showers and lockers and the amount required by code. while the project is largely limited to the conversion as defined by the planning code, it would rut in an increase in the gross floor area of approximately 7,870 square feet as the property already exceeds the base floor to ratio allowed under peks 2.10.2, this will require the purchase of transferable development rights. the department has received two letters in support of the project and nonexpressing opposition. the project is on balance consistent with the objectives and policies of the city's general plan and finds the project to be necessary, desirable, and compatible with the surrounding neighborhood. it will create additional office space at the top two floors serving to bolster employment and in an area immensely well served by transit, office use is permitted at the upper levels and conversion of the floors to a more viable use will maintain and enhance the remainder of the

building as the anchor of the downtown retail district. based on the findings within the case report, they recommend approval with conditions. the project sponsor is here to provide a presentation of their own. >> thank you. >> i am vice president of development and we are a global operator and developer of flagship destinations t majority of which are retail shopping centers much like westfield. and retail is in our d.n.a. and this project is key to a significant investment and the

request is an office allocation, but this is not a typical office project. as you have heard already, both retail owners and tenants are in the fight for our lives and the growth in online sales and change in consumer preferences are forcing us to radically rethink our businesses. what are we doing about it? we are investing in marketing and advertising, customer service, new products and yes, in our real estate assets. we're investing because we have seen and we know when retail tenants and shopping center owners invest in their properties, sales and traffic respond. >> yes, nordstrom is down sizing and we are seeking to back fill with office, but we spent a better part of two years to find retail and talked to entertainment uses, restaurants, we talked