Lendlease Halts Construction of $1B Condo Project in SF

Lendlease has shut down the construction crane at its $1.15 billion condo tower in San Francisco, citing poor marketing conditions.

The Australia-based developer stopped work for the second time this year at its 47-story tower at 30 North Van Ness Avenue, the only skyscraper to break ground since the pandemic, the San Francisco Business Times reported.

It now joins other major projects across the Bay Area to halt work until the market ticks up.

A spokesperson for Lendlease said that construction has paused “until markets normalize and we’re able to bring in early tenancy commitments, or capital partners, or both.”

“We will monitor the markets while exploring options for a potential restart in 2024,” the unidentified spokesperson told the Business Times.

The developer will continue to work on permitting, easement and coordination with public agencies and stakeholders so the development “is well positioned once construction resumes,” the spokesperson added.

The project, known as Hayes Point, broke ground last September and is Lendlease’s largest investment in the U.S. The tower’s top 38 stories will contain 333 condominiums — 83 of them affordable — while the building’s bottom nine stories will contain 290,000 square feet of offices, shops and restaurants.

The all-electric project, designed by SCB Architects, is expected to top 540 feet and make 25 percent of its homes affordable. It was once slated for completion in 2025, though it isn’t clear if that deadline still stands.

In 2017, Lendlease bought the city-owned 30 Van Ness site for $70 million in cash. The Board of Supervisors had rejected a bid from Related California because its affordable housing commitment was too low.

In February, Lendlease halted construction just seven months after the project broke ground to iron out permitting with BART. Construction resumed in April after Bay Area Rapid Transit demanded Lendlease demonstrate the project wouldn’t adversely impact the Van Ness Muni station and the rail tunnel next door.

Other major projects in San Francisco are on hold because of the pandemic and economic conditions. In spring of last year, Brookfield Properties paused construction on Pier 70, slated to become a $3.5 billion mixed-use village on San Francisco’s Central Waterfront, citing economic fallout from the pandemic.

The city’s office vacancy rate is now 31 percent — up from 4 percent in early 2020 — during a shift toward remote work.

— Dana Bartholomew