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

[Janice F Lee]

You cannot Airbnb ADU in SF

[Richard Goore]

@Bob Johnson If you are still pursuing and want a contact of mine who I have had discussions about building ADU's on existing properties I am happy to share. His company builds all over Nor Cal and he already has a number of plans for ADU's - 2+1, 1+1, garage conversion, etc. I don't know if he has built this in SF but he further along in the process than anyone else I have spoken to. He's familiar with ADU laws (at least in Sacramento) and is looking to expand that part of his companies business. Trying to think out of the box for some investor clients here in Sacramento (I am an agent) so I am looking for SFH with large enough properties and will plan to use him to build ADU's to make them duplexes, in theory. Happy to make an introduction if interested.

[Adam Mayberry]

@Richard Goore Send my way would love to learn more

[Brian Larson]

@Richard Goore - I would love to hear more about any of your ADU projects. I think the business model you described above is the next great investment model in Sacramento and the Bay Area.

I am currently working to build an ADU at my downtown home in San Jose.

[Richard Goore]

@Adam Mayberry

@Brian Larson

Msg me with your email and I will make the intros.  

[John V.]

Does anyone have recommendations for architects? The ones I've talked to are quite pricey, but I'm looking at an ADU + extension.

[Chen Zhou]

@John V. Did exactly the same as you are thinking of. Will message you separately. 

[Janice F Lee]

Many ADUS are not subdividable to condos unless you are doing voluntary or mandatory seismical retrofit. There is currently a condo conversion moratorium for 3-6 units. 

[Amit M.]

^ only applies to San Francisco 

[Matthew Ryan]

Design Draw Build in Oakland is helping Oakland write and amend ADU laws. Great resources who can help. I can give a personal intro if needed.

[Jim G.]

Found a contractor. I am in the process of build a detached ADU in San Jose... will report back the progress.

[Chen Zhou]

For those of you who're interested, I completed my ADU project and you can see the 3D visualization of my place here: 
https://my.matterport.com/models/hRAxQheq93H?section=media&mediasection=showcase