In the heart of the Tenderloin on Ellis Street in San Francisco - inside a former Turkish bath built in the early 1900s - a new kind of communal space is going up: adult dorms.
CEO Jon Dishotsky co-founded the development startup Starcity to help solve the city's housing crisis for the backbone economy - the restaurant workers, teachers and nurses. Starcity's tenants generally make $50,000-$90,000 a year.
The San Francisco Planning Commission just approved what will be a 52-unit co-living project. It is the company's biggest development yet.
"Our customers are really left with three options if they don't live with us," said Dishotsky. "They can commute two hours outside the city, they can fit four people to a three-bedroom by putting a wall up in the living room and calling that a room, or they can pay 50 to 60% of their income toward housing costs, and that's unsustainable."
Units max out at 250-sq. feet and include a private bathroom. Tenants share a kitchen, media room and have access to amenities including an arts and crafts room.
"By having sort of a more experiential living situation, people can connect more. They can put their phone down and have a conversation, and that's really what we hope to get back to," Dishotsky said.
Utilities, Wi-Fi, furniture and common area cleaning services are all included. Rent will range from $1,900 to the low $2,000s a month - in a neighborhood where the average income is about $24,000 a year.
As part of a community benefits agreement, Starcity is partnering with the Compton's Transgender Cultural District to create a retail space, provide job opportunities and work with local non-profits.
Alexandra Goldman with the Tenderloin Neighborhood Development Corporation says she welcomes development but worries there could be a downside.
"It can provide an incentive for existing SRO owners who have lower income people living in their rooms to evict those people or otherwise remove them so that they can convert to this so that it's a much more lucrative model," she said.
Starcity says so far, this unusual dorm-style living is working.