S.F. Supervisor Proposes Doubling Transfer Tax For Bigger CRE Deals

San Francisco City Hall
San Francisco City Hall

San Francisco District 5 Supervisor Dean Preston will introduce a measure nearly doubling the city's transfer tax on commercial real estate deals of $10M or higher, Bisnow confirmed with his office Tuesday.

Preston expects to introduce the plan, which would end up on the November ballot if signed by four supervisors, in the next few weeks, along with new legislation for rent and mortgage relief from coronavirus-caused financial strain.

The proposal calls for increasing the transfer tax from 2.75% to 5.5% for sales of $10M or more and from 3% to 6% for sales of $25M or more, though sales to the city or a nonprofit housing developer would be exempt from the tax increase, according to Preston's office.

Revenues from the tax, which Preston's office estimates could generate between $100M and $150M per year, would go toward city efforts in promoting housing security.

Elected as a Democratic Socialist in November, Preston recently led calls for San Francisco's largest residential landlord to delay its sale of a 2,100-unit portfolio and avoid transferring so many units to market-rate developers.

The San Francisco Examiner first reported Preston's plans yesterday.

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