Do you really think the main constraint on supply comes from rent control and not zoning limitations? In SF there is a strong desire to preserve the historical character of the neighborhoods (agree or disagree as you like, but the political will is there) and I think that's the root reason why it's difficult to demolish buildings and rebuild them with more units, not the mechanics of rent control.
In any event, even in a rent controlled building, you absolutely can terminate all of your tenant's leases and kick them out, upgrade the property, condoize it, and sell the condos (Ellis Act.) The only restriction is that you must sell the units, not rent them.
(speaking as someone who, as a side project, is in fact building high density residential units in SF)
Zoning is primary, but without rent control, the Tenderloin would be a lot better (convert the SROs into reasonable rentals). Of course, getting rid of the enablers of homelessness would also be necessary.
It's not rent control that keeps SROs around - there are separate SRO controls. You're not allowed to eliminate SRO beds without building replacement beds in another part of the city (or paying into a fund to cover the cost of someone else doing it, and it's a significant fee.)
Many of the people in SROs have substance abuse or mental health problems or other disabilities, and most (?) SRO tenants are paying their rent in federal housing assistance vouchers (which is why SROs can be so profitable - the government pays you a high price to house people that otherwise wouldn't be welcomed on the rental market, housing discrimination laws notwithstanding.)
Any zoning plan has to make space for this population somewhere in the city. If you let people demolish SRO beds, you're just going to discover that you have to build new ones at public expense.
I didn't mean 'allow construction' was a consequence of removing rent control. I meant it literally as 'remove absurd zoning restrictions that impede construction'.
In any event, even in a rent controlled building, you absolutely can terminate all of your tenant's leases and kick them out, upgrade the property, condoize it, and sell the condos (Ellis Act.) The only restriction is that you must sell the units, not rent them.
(speaking as someone who, as a side project, is in fact building high density residential units in SF)