Fillmore Heritage Center, Former Home of Yoshi's, Attracts (Another) Lawsuit

Once a beacon of neighborhood revival as the San Francisco home of jazz club Yoshi’s, the Fillmore Heritage Center has become bedeviled by litigation.

In August of 2018, San Francisco City Attorney Dennis Herrera filed suit to recover $5.5 million borrowed by Heritage Center developer Michael Johnson. In September, Johnson filed a countersuit claiming breach of contract, and that city interference ruinously undermined the project.

Most recently, a November lawsuit in federal court alleges that officials, including Mayor London Breed and Supervisor Vallie Brown, committed fraud resulting in approximately $100 million in failed public and private investments. It further charges that the city officials steered control of the center to “chosen cronies.”

“What was promoted as the flagship of the City’s renewal of the Fillmore community has instead become a glaring symbol of urban neglect, mismanagement, and corruption,” the suit reads.

Plaintiff Agonafer Shiferaw, a neighborhood businessman who previously operated Rasselas Jazz Club on Fillmore Street, has repeatedly tried to buy the crisis-stricken cultural center. His suit seeks monetary damages and a court injunction prohibiting the city from selling or leasing the property.

At the center of the suit, which the New Fillmore first reported, is an early 2017 request for proposals (RFP) to relaunch the 240,000-square-foot cultural center. Shiferaw alleges the outcome of the process was predetermined. And because he complained to the Public Ethics Commission, the suit claims, the city canceled the public process in favor of private negotiations.

The city said it withdrew the RFP due to a lack of qualified applicants. But last year officials gave $50,000 and a six-month lease to “temporarily activate” the center to two nonprofits—the San Francisco Housing Development Corporation (SFHDC) and the New Community Leadership Foundation (NCLF)—that’d submitted a proposal. The city is looking to sell the center for $6.5 million.

Chris Hansen of SFHDC said at an Entertainment Commission hearing in November that the groups are seeking a lease extension, and to buy the property themselves. The lawsuit asserts that the organizations’ “only qualification is their support for and association with London Breed.”

“This lawsuit is long on rhetoric and short on facts,” City Attorney spokesperson John Coté said in a statement. “It is wholly without merit, and the City will vigorously defend against it.”

The next hearing in the case is scheduled for February 13.

The Fillmore Heritage Center opened in 2007, promising economic stimulation and cultural renewal for a once predominantly black neighborhood crushed by redevelopment in the 1960s. Its anchor tenant, jazz club Yoshi’s, harked to the district’s past life as “Harlem of the West.”

But it was built with millions in still-unrecovered public loans, and for three years before SFHDC and NCLF received keys in October it stood vacant, a monumental disappointment. $4.8 million from the redevelopment agency was reportedly “lost” in the 2014 bankruptcy of Johnson’s business partners, and the city’s August suit says Johnson still owes $5.5 million.

Johnson reopened Yoshi’s as The Addition in 2014, but it closed within months. Shiferaw, according to his suit, struck a deal to buy the center from Johnson in May 2015 for $6.4 million, a plan the city ignored. Johnson, in his countersuit, describes this as one of the ways the city undermined the project’s financial viability before taking control of the property that June.

NCLF and SFHDC, whose lease expires at the end of March, have promised to run housing counseling and financial workshops out of the space, and are offering events such as “Tuesday Bluesday” via a partnership with boxer Karim Mayfield’s company Hard Hitta Promotions.

Majeid Crawford, NCLF’s communications director, called the partnership the “result of a long, hard-fought process, in cooperation with the City, to make sure that the reactivation of the Fillmore Heritage Center is represented by stakeholders from within the Fillmore who are committed to providing an equity plan that will serve this community long into the future.”