Mayor Lurie, Supervisor Mahmood Unveil Plan to Create Housing, Jobs

SAN FRANCISCO – Mayor Daniel Lurie today introduced the Balanced Update to Incentivize Local Development (BUILD) Act in partnership with District 5 Supervisor Bilal Mahmood as part of a legislative package to accelerate housing construction and support thousands of local union jobs by unlocking projects that are ready to move forward. The housing and jobs package will reform the city’s tax code to lower transfer tax rates on housing development projects and downtown transactions that drive the city’s economic recovery, driving investment in San Francisco while instead applying the transfer tax to certain parties foreclosing on properties to offset general fund revenue impacts. 

The legislative package is being launched with the support of a coalition of labor and business groups—including the San Francisco Building and Construction Trades Council, the North Coast States Carpenters Union, Laborers Union Local 261, and the San Francisco Chamber of Commerce. Cosponsors include District 3 Supervisor Danny Sauter and District 6 Supervisor Matt Dorsey. 

The introduction of the BUILD Act continues Mayor Lurie’s work to address housing production and affordability in San Francisco, streamline permitting and remove barriers to construction, and ensure San Francisco remains competitive and affordable for families and workers. Over the past year, the administration has advanced work to convert vacant offices into housing, delivered the Family Zoning Plan to create capacity for tens of thousands of new homes citywide, and launched a Family Opportunity Agenda to make San Francisco more affordable for families and workers. As one of his first actions as mayor, Mayor Lurie kicked off his PermitSF initiative, a multi-departmental effort to modernize the city’s permitting process with common sense reforms—leading to the introduction of 20 ordinances, including common-sense reforms to remove burdens for homeowners and small business owners. 

“Our politicians used to take our workers and our families for granted. But those politicians are gone, and those days are over. The BUILD Act will unlock stalled housing projects and create thousands of good union jobs,” said Mayor Lurie. “The BUILD Act will incentivize investment in these housing projects and buildings downtown—stimulating new jobs for electricians, plumbers, and laborers. We are creating the conditions for our city’s success—we will take the next step by passing the BUILD Act, and we will create the jobs and build the housing that San Franciscans deserve.” 

“San Francisco cannot afford to leave 50,000 entitled homes stalled because of outdated tax codes, and the BUILD Act restores balance to our tax structure so these projects can move forward, creating thousands of good union jobs for the skilled tradespeople who build our city,” said Supervisor Mahmood. “By modernizing the transfer tax in a revenue-neutral way, we are protecting funding for affordable housing and making it possible to deliver the homes that current and future generations of San Franciscans need—this is how we build a city that works for the next generation.” 

The BUILD Act will reform policies that contributed to rising costs for purchasing real estate in San Francisco and declining large real estate sales. Instead of generating revenue for affordable housing, Proposition I (2020) doubled transfer tax rates on large real estate transactions—making San Francisco’s transfer tax among the highest in the nation as housing creation slowed and revenue, going to the general fund, fell. 

The reforms in Mayor Lurie and Supervisor Mahmood’s package will bring San Francisco’s tax structure closer to parity with other cities, unlock real estate transfers across the city, and increase the feasibility of housing development projects—creating more opportunities for housing production and job creation across San Francisco. 

With tens of thousands of housing units entitled but not built, stimulating these projects will create thousands of union jobs for electricians, plumbers, laborers and more to build housing in San Francisco. The package will reduce the cost of construction by $32,850 a unit, as much as 5% of total cost for private development projects. 

“Many projects have sat on the sidelines because of the high cost of construction in San Francisco. Resetting the transfer tax reduces a significant barrier. The time to have a real economic recovery for middle class workers is now,” said Rudy Gonzalez, San Francisco Building Trades Council Secretary-Treasurer. “This proposal is about unlocking projects that have affordability, community benefits, and good union jobs already negotiated.” 

“When housing developments move forward and projects are unlocked, it creates thousands of good-paying jobs and countless opportunities for San Francisco’s workers,” said Ron Rowlett, North Coast States Carpenters Union Political Director. “A steady pipeline of construction projects means more jobs for San Francisco’s union carpenters, stability for working families, and stronger neighborhoods across San Francisco. We are proud to support this effort to restore momentum to our construction industry and strengthen San Francisco’s economy.” 

“The BUILD Act will support thousands of union construction jobs by helping jumpstart dozens of stalled projects that do not yet pencil out financially,” said David De La Torre, Laborers Union Local 261 Business Manager. “We thank Mayor Lurie and Supervisor Mahmood for getting these projects moving again, creating jobs for laborers and other construction workers across San Francisco, and ensuring that the city’s economic recovery benefits all working people. While sustaining union construction employment, the BUILD Act will also lead to future housing opportunities our members and other workers looking to live and thrive in San Francisco.” 

The BUILD Act aims to take a broad approach to correcting the impacts of prior transfer tax changes while offsetting general fund revenue impacts. For transfers involving multifamily housing, commercial real estate, and other property types excluding single residences, transfer tax rates will return to pre-2020 levels: 2.75% for transfers of at least $10 million and 3% for transfers of at least $25 million. The legislative package will not change transfer tax rates for single residences or for property transfers below $10 million. 

“This targeted transfer tax reform will help lead to more new housing, and more affordable housing, for San Franciscans,” said Corey Smith, Housing Action Coalition Executive Director. “This adjustment will ensure financially infeasible projects become homes for families, seniors, and everyone looking for an affordable place to live.” 

“If we are serious about addressing our massive affordable housing shortage, we have to match our overall housing production goals with clear funding solutions for affordable housing,” said Rebecca Foster, Housing Accelerator Fund CEO. “Tens of thousands of people who work in this city cannot afford to live here, and many longtime residents are severely rent-burdened and struggling to stay. Closing that gap requires permanent, reliable funding. Taking immediate action with tools such as bonds, enhanced infrastructure financing districts, and housing trust fund reforms is essential to building truly affordable housing at scale and preventing homelessness.” 

“San Francisco cannot afford policies that discourage investment at a time when we need new housing, office repositioning, downtown activation, and job creation,” said Rodney Fong, President and CEO, San Francisco Chamber of Commerce. “Our transfer tax has been among the highest in the country, and at those levels it undermines transactions and slows the very activity we need to create new opportunities. Reducing the rate makes it more feasible to finance complex projects, support construction and small business jobs, and close critical deals that move our city forward.” 

To offset general fund revenue impacts over time, the legislative package includes a drafting request for a November 2026 ballot measure. The measure would ensure transfer tax is paid on more transactions, including potentially eliminating a tax exemption for certain parties who are foreclosing on a property or accepting a deed in lieu of foreclosing. 

“There’s long been a transfer tax exemption for certain foreclosure transfers in San Francisco, but in recent years we have seen a dramatic increase in the number of high-value commercial transfers claiming the exemption,” said Assessor-Recorder Joaquín Torres. “This change has big implications for San Franciscans. As administrator of the tax, it’s important to me that the public know what’s happening so that they stay in the driver’s seat.” 

As part of the legislative package, Mayor Lurie has convened key city departments to identify a more effective source of funding for affordable housing. Led by the Mayor’s Office with participation from the Mayor’s Office of Housing and Community Development, the Office of Economic and Workforce Development, and Planning Department, the group is considering options including a bond measure, raising the limit on the city’s Housing Trust Fund, Enhanced Infrastructure Financing Districts, and certificates of participation. The group will deliver recommendations within three months. 

“San Francisco’s transfer tax rates are among the highest in the country and that sticker shock has been stifling investment in both new development and improvements to our hotels, offices, and apartment buildings that make our neighborhoods stronger,” said Anne Taupier, Office of Economic and Workforce Development Executive Director. “With the BUILD Act, we’ve developed a revenue-neutral, innovative solution that removes those barriers. This package will help restore confidence in our real estate market, accelerate housing, and bring long-term benefits to communities across San Francisco.”