San Francisco mayor highlights downtown business openings amid recovery push

By Max Darrow

On Friday, San Francisco Mayor Daniel Lurie and Assemblymember Matt Haney led a walk through Union Square to talk about downtown recovery progress and challenges.

They were joined by several San Francisco Supervisors, as well as business, economic, and community benefit district leaders.

Haney is on a statewide tour of downtowns trying to figure out how they can best recover post-pandemic. Lurie just recently announced his Heart of the City initiative, a multi-pronged approach to revitalizing downtown with the help of private funding.

“San Francisco is on the rise. Today is better than yesterday, and tomorrow is going to be better than it is today,” Lurie said.

San Francisco has struggled with both retail and office vacancy rates. In Q2, Union Square had a 23% retail vacancy rate, per a recent market report from Cushman & Wakefield. Lurie says that is beginning to turn around.

“There are more people leasing space than leaving space for the first time in six or seven years,” he said. “Crime is down 40% in this part of San Francisco, in downtown.”

One area that’s becoming a main focus with revitalization? The Powell Street corridor at the entryway to Union Square.

“It’s going to happen by being relentless and by winning companies and retailers back to San Francisco, which is what we’re doing,” he said.

Lurie points towards bigger businesses opening up in the area, such as the Nintendo Store and Zara, but also smaller ones like Dandelion Chocolate, which just opened a Union Square location on Friday.

“We’re proud to continue investing in the city we love, sharing our chocolates with locals and visitors alike, contributing to the vibrancy of our neighborhoods,” said Dave Mogridge, COO of Dandelion Chocolate. “Dandelion has a deep commitment to maintaining manufacturing in the city.” 

Next month, The Intersection of Art and Technology (TIAT) will open its event space and non-profit headquarters on Powell Street through the Vacant to Vibrant program. That will mark the fifth Union Square pop-up to fill a vacant storefront this year, and the 33rd pop-up citywide.

Haney says downtown recovery in San Francisco and elsewhere hinges upon the city and state eliminating red tape that disincentivizes businesses.

“Retail stores are vacant. Vacant lots are sitting there that should be available for housing. We shouldn’t be getting in our own way by making things more expensive and more time-consuming. Everything needs to be about speed and flexibility at a time where we are experiencing these challenges,” Haney said. “If you have a vacant retail store and somebody is interested in it and we tell you it’s going to take a year to get this thing open, they’re going to walk away. Now, the city and state are saying one stop shop for permitting, streamlining all inspections, making sure that you don’t have to talk to ten people plus the state in order to get something done here.”

He argues that is happening.

“We’re doing our part, changing our laws around CEQA, making sure there is a buy-right ability to do adaptive re-use to change office space to housing. The city is doing their part as well. Businesses are feeling it. You’re already starting to see the difference,” he said.

There is a challenge that cannot be quantified, however.

“Making sure that the perception meets the reality,” Haney said. “We still have a problem where a lot of folks think San Francisco is not a place where you want to invest, not a place that you want to visit.”

Lurie says improving public safety is key to changing both the reality and perception.

“I am as frustrated as anybody about some of the street conditions that we have in different parts of downtown. We have to do better,” he said. “First, it starts with public safety. We have to recruit more police officers. We have a net increase at SFPD for the first time in seven years. We have a net increase in sheriff’s deputies for the first time in 10 years.”

From their standpoints, the downtown prognosis is good, and momentum will continue with the city and state working in tandem.

“We have work to do, but we are moving in the right direction,” Lurie said.