$3.35M Construction Loan for a Potrero Avenue Unit Conversion in San Francisco

Most construction loans in this database precede any public record of what is being built. The one at 1060 Potrero Avenue is the opposite: the project is documented in detail in San Francisco's permit files. Avidbank recorded a $3,350,000 construction deed of trust on May 12, 2026, executed May 5, against a 1907 three story mixed use building of 2,554 square feet on a 2,500 square foot lot.

The permit trail tells the story. A permit filed in December 2016 and issued in February 2019, with an estimated cost of $1,600,000, approved a renovation and vertical and horizontal addition over abandoned ground floor commercial space to create five apartments plus an accessory dwelling unit. A revision filed in 2020 and issued in April 2022 reworked the program to three dwelling units plus six ADUs within the approved envelope, taking the building from three stories to five. A 2020 soft story seismic upgrade permit, completed voluntarily, qualified the building for unlimited ADU density under the city's program. A small 1907 storefront building is becoming a nine unit property, and every step is in the public file.

The recorded debt matches the arc: a $3,590,000 construction deed of trust recorded in 2019 as the first permit issued, private party financing of $815,000 and $250,000 in 2018 ahead of it, and now the 2026 construction loan. The property last sold in April 2022 for a recorded $1,700,000. The owner of record is an individual, and no more is published about them.

Avidbank is a San Jose headquartered Bay Area bank whose real estate group runs separate construction and commercial divisions; its published materials describe land, pre development, and construction lending on residential, commercial, and mixed use properties, with commercial loans of $1,000,000 to $15,000,000. Those are program figures from the bank's page, not terms of this loan. This is its first closing tracked on LoanList.

Within San Francisco's tracked record the loan ranks 19th of 26. The city's tracked mixed use closings this spring bracket it: $3,365,000 from J.P. Morgan in April, $4,900,000 from Bank of San Francisco in March, and $7,500,000 from J.P. Morgan in April.

For small owners eyeing ADU conversions, this file is close to a how to guide: entitle in phases, use the soft story upgrade to unlock density, and expect the construction financing to come from a local balance sheet bank. The permits, the amounts, and the sequence are all public record.