Adopted in September 1985 as a part of the City’s Downtown Plan (Ordinance 414-85), the Transferable Development Rights (TDR) Program was enacted to encourage the preservation of Downtown San Francisco’s architectural heritage.
Prior to the passage of the legislation, the Planning Department identified over 450 buildings located in Downtown San Francisco considered architecturally significant including those which contribute to the architectural heritage of the City. Each of these buildings received a rating of Category I, II, III, IV or V. The higher the rating the more important the building and the more difficult to obtain approvals to alter the façade, add square footage, or demolish the building.
To compensate the owners of these buildings for the diminution in property value caused by these new restrictions and to provide a source of funds for the preservation of these buildings, the City authorized the owners of these buildings to sell TDR. The quantity of TDR for any given property is equal to the difference between the square footage of the existing building and the total square footage that could have been built on the property in accordance with the zoning regulations. If the building is equal to or larger than what could be built on the site, the property does not have any TDR.
The developer who purchases the TDR may increase the square footage of a new project by an amount equal to the square footage of TDR purchased from a historical building. Generally, for properties located in a “C-3” zoning district, TDR may increase the size of a new project by 50% to 100%. For those development sites located within the Transbay Center District Plan area, TDR may be used to increase the floor area ratio of a new building by 3:1.