In the decade since construction started at the Shipyard, San Francisco’s biggest housing development, with 12,000 approved homes, the project has endured lawsuits, a global recession, a spectacular environmental cleanup scandal and a pandemic.

Yet, somehow, despite numerous delays and the fact that many real estate observers long ago wrote the project off, new buildings continue to pop up on the steep hillside overlooking the bay. Parks continue to get built. And more and more San Franciscans call the Shipyard home. 

This summer, as the city continues to be in a housing slowdown, the redevelopment of the former naval base is entering, perhaps, its busiest phase to date as a new 77-unit building will open. And construction is set to start in June on three buildings that will add nearly 200 affordable rental units to the neighborhood.

At 151-351 Friendel St., Jonathan Rose Companies will break ground on a two-building complex with 112 units, which will be affordable to families earning between 30% and 50% of area median income — between $41,000 and $70,000 for a family of four. The project is being funded with $61.5 million from the city’s Office of Community Investment and Infrastructure. 

And, at nearby 11 Innis Court, Mercy Housing will start excavation on a 73-unit project, which will be unusual in that it will cater to large families, with several five-bedroom units. That project will also target families earning between 30% and 50% of area median income.

Sarah White, director of development for Jonathan Rose Companies’ California office, said the project was twice delayed because it was not awarded affordable housing tax credits, which have become increasingly competitive in recent years.

“It’s rare to be able to reimagine a former shipyard into a vibrant and dense neighborhood,” she said. “It’s exciting to be part of that transformation.”

Meanwhile, master developer Lennar is competing its final condo project in the Hillside, a 77-unit complex where homes will start at about $400,000. With the building, called Madison, Lennar will have built 582 condominiums and completed its work in the Hilltop neighborhood. 

“We’re proud to have built a thriving neighborhood in the heart of San Francisco and begun the revitalization of the Shipyard,” said Garrett Chan, vice president of sales and marketing for Lennar-Bay Area Urban. 

But even by San Francisco standards — the city is one of the most expensive and difficult places to build in the country —  just completing less than 10% of the units planned for the Shipyard and nearby Candlestick Point has been extraordinarily challenging. 

Nearly five years ago construction was humming along when a cleanup scandal brought the project to a standstill. A group of whistleblowers who had worked on the remediation of the Superfund site accused the contractor hired to oversee the $1 billion cleanup of cheating, alleging that soil from areas of the property known to be clean were switched with dirt from heavily contaminated areas, and that truckloads of contaminated soil were removed from the site without being scanned for radioactive material. 

In the end, two former radiation control technicians for Tetra Tech EC, the company that oversaw the cleanup of the former top-secret nuclear test lab on the site, pleaded guilty to federal charges of “destruction, alteration or falsification of records.”

That put the whole redevelopment on pause for two years and led to a flurry of lawsuits. A group of 83 early condo buyers sued the developer and won a $6.2 million settlement. Master developer FivePoint Holdings sued the Navy, saying it had “conducted grossly negligent oversight” of the process. Tetra Tech also sued the Navy and the Environmental Protection Agency, alleging that the government agencies had bowed to political pressure and “arbitrarily decided that all investigation and remediation” had to be entirely redone.

And while the Hilltop neighborhood is expected to be 100% built out in the next few years, it’s unclear when or whether work will start on the other parts of the Navy base or at Candlestick Point. While the hilltop area being developed was used for Navy officer housing and has been ruled free of hazardous pollutants, the acreage down the hill ranks as some of the most contaminated property in the United States, tainted by radioactivity and high levels of toxic heavy metals like manganese, arsenic and vanadium.

None of these legal or environmental issues were mentioned a decade ago, in May 2013, when the late Mayor Ed Lee stood on the windy hilltop at the Hunter’s Point Naval Shipyard and celebrated the start of what, at the time, seemed like a transformative project.

“The promise is being delivered … dirt is being turned over and buildings are getting started,” Lee said at the time.

Thor Kaslofsky, who heads up the Office of Community Investment and Infastructure, the agency overseeing the redevelopment, said that the Shipyard will be vital if San Francisco is to make good on its state mandated goal of planning for 82,000 units, 46,000 of which are supposed to be affordable to low- and moderate income families, over the next eight years. 

Oscar James, a longtime board member of Bayview Senior Services, said residents have been waiting for affordable housing to be built at the old military base since the Navy shut it down in 1974. He said the three new affordable buildings about to start have been “a long time coming.”

“We have been waiting for this day for over 50 years,” he said.