Despite Market, Developers Dig Into Potrero Hill

SAN FRANCISCO-Despite reports from industry experts that the market here will continue to slide south of Market Street, some developers are sticking with plans to build in parts of the city that haven’t had a new commercial project for years.

According to a report from Grubb & Ellis, the San Francisco office leasing market is showing signs of stabilization in the central business district, but the area south of Market Street has vacancy rates of more than 20%. Despite this news, at least three large projects are slated for the Potrero Hill area between the Mission District and the Bay.

Construction is underway at 350 Rhode Island St., a 260,000-sf office project by Stein Kingsley Investments. The site is a full city block in the heart of the South of Market sector. The project consists of two inter-connected, four-story buildings with two levels of parking.