Cross-Cutting Considerations

Neighborhood-specific Needs

We are using “downtown” to refer to San Francisco’s central business district, most directly the Financial District, Union Square, and SoMa northeast of 5th Street. Its economic and social footprint, however, clearly extends into Chinatown, North Beach, the Embarcadero, Mid-Market, the Tenderloin, Civic Center, and outer SoMa.

The pandemic set off a staggering reversal of fortune for this part of the city. Pre-pandemic, downtown generated 79% of San Francisco's GDP and 70% of its jobs. But a lasting shift to remote work, together with ongoing layoffs, hollowed out our central business district. We went from having the lowest level of available office space to the highest in the nation, today. Sharp drops in domestic and especially foreign tourism drained our shopping areas of customers. Corporations, conventions, major retailers, and small businesses alike have departed. In 2023, many downtown census blocks were still generating less than half their sales tax revenues of 2019. The city’s economic engine remains stalled, threatening a catastrophic drop in tax revenues that fund everything from the fire department to the arts.

Source: San Francisco Chronicle. Chronicle data drawn from San Francisco Sales Tax GIS Viewer.

Many proposed revitalization strategies—such as office-to-housing conversions—will be years in the making. Policymakers have been working to reduce regulatory barriers to better support business and entertainment activities, improve safety and cleanliness, and attract visitors. But those efforts, too, likely face long time horizons to reach the hoped-for tipping point.

While the urgency of the situation downtown is unquestioned, a commitment to a resurgence “for all” San Franciscans requires consideration of other parts of the city. San Francisco’s unique cultural identity is deeply rooted in its neighborhoods, which are experiencing varied recovery trajectories post-COVID. Following initial rebounds, inflation-adjusted revenue dropped in 33 of 39 neighborhoods between 2022 and 2023, and only five neighborhoods exceeded 2019 revenues. The Outer Sunset and Japantown have bounced back. Hayes Valley, not yet at 2019 levels, is described by many as coming back to life due to its focus on cultural activities and inviting public spaces. Meanwhile, other areas such as North Beach, Bayview Hunters Point, and the Outer Mission, remain economically depressed.

Source: San Francisco Chronicle

Equitable Recovery Strategies

San Francisco’s COVID experience and subsequent social and economic stressors have impacted our many residents in dramatically different ways. Wealthy residents, often able to transition to remote work and leverage financial stability, generally fared better, while low-income residents faced significant job losses, inadequate savings, and heightened housing insecurity. Some families benefited from better access to technology and private tutoring—in a few subjects even exceeding normal learning rates—while poorer families faced a digital divide and resource shortages, leading to greater learning loss.

Black-owned businesses on average suffered two to five times the drop in earnings versus white-owned businesses during the pandemic, partly because those with greater resources could more easily pivot to online models or delivery services. People of color launching new businesses make do with one-third the startup capital and have less access to working capital overall compared to white entrepreneurs. Black and brown artists are also experiencing a slower recovery following disproportionate impact.

"Public health studies by ZIP code show the life expectancy for Tenderloin residents drops by 10 years from Nob Hill to Turk Street due to crime, drugs, poverty and health and safety issues."

~ Kate Robinson, Executive Director, Tenderloin Community Benefit District

Moreover, there is growing evidence that cities typically rebound to greater overall economic health within a few years following major natural disasters—but the benefits of recovery disproportionately favor the wealthy and exacerbate racial inequalities. Before the current crisis, the influx of tech and other high-income workers had driven up living costs and made San Francisco unaffordable for artists, musicians, immigrants, nonprofit workers, and small businesses—some of the very people who made this a unique, vibrant, and desirable place to be. Consequently, when companies chose to abandon their physical workspaces, the decision was facilitated not only by operational ease but also by a diminished sense of community attachment. Efforts to attract high-income workers and drive consumer spending may help restore the city’s tax base, but without clear strategies for ensuring equity, we risk worsening life for our most vulnerable residents and jeopardizing an essential feature of our city’s appeal.

Luckily, periods of unusual disruption, like the current moment, present us with opportunities to shape a future that more fully embodies our values: A commitment to fostering a prosperous San Francisco, for all, means just that.