Mark MacDonald was at a loss.Like market rate developers across San Francisco, his approved 425-unit mid-rise building at 300 DeHaro in Potrero Hill was stuck, victim of the familiar combination of high interest rates and construction costs. The cost of the project had doubled since he bought the site in 2019, and with San Francisco struggling to recover from the pandemic, the pension funds and banks that typically bankroll such projects were missing in action.
But, rather than wait for the economics to make sense, MacDonald did something he had long wanted to do: He got into the affordable housing business.
On Monday MacDonald’s company, DM Development, will celebrate the groundbreaking of a 300 DeHaro building that will feature 425 studio and junior one-bedroom units. The project is unusual not just for its size — it is two or three times the size of a typical affordable complex — but because DM Development is a market rate builder entering a world of affordable housing development that is renowned for a Byzantine regulatory calculus that can make for-profit building seem like basic math…