13-Year Development Project Leaves Fate Of Legacy Businesses In Question

The popular Ave Bar and Lounge and Ocean Hair Design among other businesses have not even been able to negotiate their fates with the developer.

A rendering of the proposed development by TJ Development for 1601-1633 Ocean Ave.
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In February, real estate developer TJ Development entered the Environmental Impact Review planning process to demolish their four buildings between 1601 and 1633 Ocean Ave. and build a four-story condominium.

For the last 13 years, several developers have each proposed similar plans while leaving long- time merchants often without leases and the community in the dark about what will come next. Presently, three storefronts are empty and blighted.

The oldest business on the block is the popular Ave Bar and Lounge, a neighborhood fixture since 1949 and one of four San Francisco Legacy Businesses in Ingleside recognized for their age and import in the neighborhood. Ocean Hair Design, a neighboring salon that has provided affordable haircuts since 1996, is also a Legacy Business.

The development plans would raze them both, as well as the longtime leather repair shop A-1 Shoe Repair, Star Nails, the Latino church Iglesia Evangelica Bethesda Inc. and Year Round Tax Accounting Service.

“I know everybody here,” the Ave co-owner Lucia Fuentes Zarate said. “This business has been here since the 1940s. Over here, I have my customers. I have my livelihood. If I need to move to a different location; it’s to start over again.”

Project and Developer

TJ Development bought the proper- ties from Willart, LLC for $6.7 mil- lion in November 2014, according to a 2015 San Francisco Chronicle dispatch. Their condominium proposal would include four commercial units and a 27-stall parking garage on the first floor. The three stories above would house 54 residential units, six of which would be offered below market-rate.

The project will be worth $45.6 million when it’s completed, accord- ing to the company website. Construction will cost an estimated $13.9 million, TJ Development’s Chris Lim stated in the company’s Jan. 31, 2018 Environmental Evaluation Application. If both statements are correct, TJ Development would net $25 million from the project after property and construction costs.

Despite the plan’s progress into the EIR, three of TJ Development’s five managers — Brian Bauer, Allen Zheng and Chris Lim — are no longer with the company. The only remain- ing manager is Roy Yu, the company’s chief financial officer. The company’s corporate office is in Irvine, and their CEO Jianping Wu is situated in China. TJ Development’s communications with its tenants varies. While Fuentes Zarate occasionally hears from Yu, other business owners like Ocean Hair Design’s Cindy Huynh have not heard anything about the project from their landlord.

“We don’t get any information from them,” Huynh said.

A-1 Shoe Repair’s longtime cobbler Yoni Recinos said that as of late, he has only heard he would not have to move out this year.

The lack of transparency has been exacerbated by TJ Development’s blighted office building on 1601 Ocean Ave. that has its doorbell button pulled out, an email that does not work, a dysfunctional “Contact Us” form on their website, a company phone that is rarely answered and a lack of a voice mailbox.

But District 7 Supervisor Norman Yee has met twice privately with developers concerning the project, SIA Consulting architect Reza Khoshnevisan said, according to a May 11 Light article.

“I expressed to the developers of 1601 that my priorities include housing for families, maximizing the number of units that are inclusionary and

retaining a small retail atmosphere along Ocean Avenue,” Yee told the Light.

Yee raised eyebrows last year when the May 15 article revealed he rented 1601 Ocean Ave. for just $1,071 a month for his 2016 campaign. In comparison, the previous tenant paid the previous property owner, Willart, LLC, $2,600 per month in 2012 and would have paid $3,000 per month in 2016 if he followed through with a five-year lease, according to a court filing.

Yee rented the entirety of 1,950 feet of space, but Lim, attorney and Yee all said the latter’s rate was appropriate because he only needed one-third of the space for his campaign.

Neighborhood Impact

Since TJ Development took possession of the property, apparel store Bayfitted and Chy's as well as Martha Nyuang’s Dollar Best Store have been vacated. Ocean Hair Design and other tenants have been renting month-to-month without a lease for more than a decade. The Ave’s lease expires in August, and TJ Development has not guaranteed an extension for them or any other business.

“It’s hard to have a business and to improve your business or even to sell your business if you don’t have a lease,” Ocean Avenue Association Executive Director Dan Weaver said.

By merging four buildings, the plan would violate a Balboa Park Station Area Plan recommendation that states only corner and adjacent parcels should merge.

At TJ Development and SIA Consulting’s meeting on April 10 last year, neighborhood advocates also found fault with their plan at the time for proposing commercial space only 60% the size of the present project area’s. The present proposal offers the same figure, according to this year’s Environmental Evaluation Application.

Attendees also shared the concern that the neighborhood would lose flavor if the project area’s small, family-owned businesses are replaced with chain stores because the latter could better afford to do business in a new condominium.

Planning Department Southwest Team Manager Delvin Washington said that the project is still in the early stages of the entitlement process, and that the developer would probably come in with another entitlement project six to 18 months after the beginning of the EIR.

Yee’s aide Nick Pagoulatos stated in an email: “since this project may be appealable to the Board of Supervisors, the Supervisor cannot take a position for or against the project at this point because he would then jeopardize his ability to be able to vote on the project should it be appealed to the Board.”

Likewise, TJ Development was unable to provide any information about the project for this article, citing the lack of a project manager.

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