May 15, 2024

Greetings to all Owners and Friends of the Suites,

I’m always reminded of how special San Francisco Suites is when I call to make a reservation. Unlike almost all of its peers in the hospitality industry, I do not have to submit impatiently to a recorded anonymous announcement listing numbered options preceded by the admonition to “listen carefully as our numbers may have changed,” followed by a long wait punctured by repetitive advertising or insipid music. Instead, I’m greeted by a front-desk person whom I know and who knows me, and I’m able to have a real, live conversation where I can discuss my upcoming visit, state my preferences for certain suites if available, and share what’s new in my life with someone who cares about me. Later, the uniqueness of the Suites reaffirms itself upon my arrival when I am welcomed by the front desk concierge with a smile and an offer to accommodate any special requests: help with my luggage? valet parking? a dinner reservation at a popular new restaurant? a daily newspaper? The personalized attention continues throughout my stay, with housekeepers calmly waiting to clean my suite in spite of my late start, with the houseman allowing me a glass of wine after the wine and cheese hour has passed, with a kind inquiry from the General Manager about my dog’s wellbeing, and so on.

I’ve just read in the New York Times that hotels are moving toward a check-in process that foregoes the sign-in at a desk, with guests only needing a code they received online upon booking to gain entry to their room, similar to checking out where one just leaves by closing the door and walking away, without any communication or a goodbye. And daily housekeeping at hotels has gone the way of the dial telephone. At my last hotel stay, I was informed that my room would be cleaned only after I checked out. What about dirty towels? What about the overflowing wastepaper basket where I had left the remains of a fast-food lunch? “Sorry, but we don’t have staff for daily cleaning, and if we did, that would be an extra charge on your bill” was the reply.

I’m sure that most owners did not purchase their shares because they thought of San Francisco Suites as a good deal; they bought their shares because they love San Francisco, and the Suites offer convenient, comfortable, even luxurious accommodations while they are in the City where they can work, enjoy the culture, entertain guests, and just relax. I mentioned “peers in the hospitality industry” above, but I’ve come to believe, and I hope you do as well, that the Suites has no peers, for personal service, atmosphere, location, and amenities, in San Francisco, and few in this country.

You are probably aware that the Board has recently made three revisions to our Rules & Regulations, a document available to you at our website, which provides guidelines for owners, guests, and staff in our everyday operations. The most significant of these derives from a change in ownership which has been slowly but steadily making itself known to us. The San Francisco Suites on Nob Hill was established in 1982, almost 42 years ago, and many from the first generation of owners, those who bought their shares from the original developers or soon after, no longer can travel, no longer wish to travel, or have passed on. The result is an unprecedented number of owners (or their heirs) who want to sell their shares, to deed them back to the Association, or, in the worst cases, to walk away from their commitment and court collections and possibly foreclosure. Our budget depends on the receipt of the full assessment from all owners, a promise they made upon buying their shares; and when many shares no longer produce revenue because they are deeded back to the Association with no likelihood now of being sold or adopted, or because their owners refuse to pay the assessment, then the entire Association suffers. And the number of non-performing shares this year has increased egregiously.

Thus, the Board after consulting with our attorneys, has decided to rent out some of the time held by those shares deeded back to the Association or by those shares whose owners cannot or will not pay their assessments. In doing so, we hope to make up for the anticipated budget shortfall and avoid having to severely increase in the coming year the annual assessment, to reduce service or amenities, to lay off staff, or to impose a special assessment. Renting out share time through Airbnb or similar agencies will not diminish the ability of owners to reserve time at the Suites, it will not change the character or quality of the Suites, it may introduce new, potential owners to the Suites from all over the world, and most importantly it will help us fulfill our financial obligations. (As a point of comparison, all the other timeshares in our neighborhood successfully rent out unused share time.)

Our CC&Rs, in an amendment passed a few years ago, expressly forbid City Share owners from renting out their share time for commercial purposes through a third-party agency. With this in mind, the Board asked our attorneys at Adam Stirling if the prohibition applied equally to the City Share Association. Two attorneys, working separately on this question, reached the same opinion: the City Share Association is not the same legal entity as an individual City Shareowner, and must act for the financial security and betterment of the whole Association. Unlike City Share owners who would rent share time as a source of personal income, the City Share Association, as a non-profit, might rent share time not to increase revenue beyond the budget but to offset revenue loss to meet the budget requirement.

I’ve taken some time to explain the reasoning behind the new Rule #13. (Please keep in mind that it is not a rule change, as the attorneys agreed that our CC&Rs never excluded the City Share Association from renting, only the individual City Shareowners. Rule #13 seeks to summarize and clarify then what is already stated and implied in the CC&Rs, like many other rules.)

I can promise you as President of the Board and as a loyal owner that I will do all in my power to maintain and enhance the experience of staying at the Suites so that it remains that special and unique place I described at the beginning of this letter. I can also assure you that every Director on this Board is committed to a productive year of service to the Association, to guide the staff, to respond to owners, and to ensure the Suites’ financial integrity.

Sincerely,

Geoffrey Bellah
President of the Board of Directors
San Francisco Suites