Anyone with an ADU (Accessory Dwelling Unit) build experience?

[Bob Johnson]

I have a chance to buy in (via TIC) to what is basicly a 10' x 24' shed at an advantageous price that I've been given the verbal ok from SF Planning that would work for an ADU. I'd have to run sewer and all utilities to it, as well as do a studs down remodel (it actually has good bones and a reletively newer asphalt shingle roof). Assuming a $100K build/permitting budget, and 80% occupancy once it's done as an AirBNB rental, it "should" yield me almost 10%, and be a possible condo candidate in 2022 when the lottery opens again.

The question is, what pitfalls aren't I seeing here? I have a contractor (who doesn't know ADU law), a PM and cleaning crew lined up (I own other properties in The City, and have done VRBO in other houses, so I know those issues). What can SF Planning do to me to go back on their word? Any particular city inspector problems for these things?

Thanks in advance for any insight, I appreciate it!

[Chen Zhou]

@Bob Johnson

Consider San Jose. Approval process is much faster and rules are much more relaxed.

I recently got permit approval in SJ (Willow Glen) for a 630 sqft attached ADU + 170 sqft addition to the existing unit. It took me about 4 months to get my permit and now I'm 3 months away from completion of the construction.

Here's the cost breakdown:

Architect + structural engineer	$ 7,000
Park fee	$ 4,450
School fee	$ 2,192
Permit application	$ 2,653
Permit Issuance	$ 9,416
Contractor (estimated)	$ 170,000
Inspections (estimated)	$ 4,000
Landscaping and other miscellaneous	$ 300
Total (estimated)	$ 200,011