San Francisco has approved an ordinance allowing the conversion of 38 residential hotel rooms at 447 Bush Street into tourist hotel rooms. This decision is part of a legal settlement in the Hotel Des Arts, LLC v. City and County of San Francisco case, which challenged the city’s 2023 amendments to the Residential Hotel Unit Conversion and Demolition Ordinance. In exchange, 34 group housing units at separate properties on Hayes Street and Ivy Street will be converted into residential hotel rooms. The ordinance waives conditional use authorization requirements and development impact fees for the 447 Bush Street conversion. The Department of Building Inspection is tasked with issuing new certificates of use to reflect the changes. The move is expected to provide more flexibility for hotel operators while ensuring a net-zero loss of residential hotel units.
This ordinance provides a compromise between the city’s housing preservation goals and the hotel industry’s operational needs. By facilitating the legal conversion of residential hotel rooms while maintaining the supply of permanent residential hotel units, the decision helps balance tourism growth with housing stability.