Not quite...this isn't a plan to privatize existing green-space and build a mall on it.
The city plans to change a term of the city code requiring private development in one neighborhood to provide "public space" -- which could mean an outside park like Zucotti or an publicly-accessible area inside like a plaza -- to allow developers to pay a fee to the city instead.
In theory, requiring public space is great and can help achieve an open and welcoming city. In practice, these public areas are difficult to find and aren't public knowledge since the developers do everything they can to hide them away in the first place. The SF plan seems well-meaning but wide enough to drive a train through, and when the local paper needs to publish an article pointing out these spots, their objective has been a failure.
What the city should be doing is tightening up their code and fighting the developers when they propose "public space" on the 4th and 9th floors of a fancy hotel, but I know from experience that can be a costly battle from the city's perspective.
Also, the idea that it's going into a Rec and Park fund tells you their department is coming up short on their budget.