Bureaucracy and blight have turned a once-vibrant club into a ‘cesspool,’ owners say

The owner of a San Francisco comedy club believes his landlord is intentionally neglecting the space with the aim of flipping the property.

​​In fall 2019, The Setup, an independent comedy club in the Tenderloin, seemed to finally be hitting its stride. It was booking sets by buzzy comics, including Taylor Tomlinson, who used The Setup to work out the kinks in her then-forthcoming Netflix special, Quarter-Life Crisis.

“They had two shows a night on Friday and Saturday,” Nato Green, a longtime anchor of the local comedy scene who regularly performed at The Setup, said. “It was packed out with a lot of great energy.”

The club's founders, local comics Abhay Nadkarni and Richard Sarvate, were excited by what they had built. Then the pandemic forced The Setup's live shows to come to a screeching halt. But unlike the dozens of clubs in San Francisco that reopened in 2021, The Setup has remained dark, falling into a state of ruin that the club’s proprietors describe as “a cesspool,” due to neglect from an out-of-town landlord and sluggish city bureaucracy. 

Nadkarni, a standup who moved to San Francisco from India to pursue comedy, told The Standard that by the time he could safely reopen, his club was in shambles. Nadkarni said there was visible water damage and he found rat skeletons on the floor. 

“The place is completely filled with sewage and has a putrid smell,” Nadkarni said. “It’s basically a hazardous zone.”

Nadkarni said people have broken into his building at 222 Hyde St.—which also housed a bar called the Beer Basement that’s been closed for the length of the pandemic as well—more times than he can count.

“When the cops show up, they do nothing,” Nadkarni said. “It's almost like a courtesy call.”

As of press time, the SF Police Department could not confirm the incidents Nadkarni referenced.

In 2021, the building was sold to High Point Holdings, a real estate firm based in Glendale. Nadkarni said that Jesus Lim, director of High Point Holdings, has ignored his multiple requests to repair the damages to the space. Although Nadkarni and Sarvate have not been paying rent since the fall of 2021, Nadkarni estimates that blight and break-ins have caused about $100,000 in damages to The Setup. Plus, the club has lost three years’ worth of income. 

Though the mission page on High Point’s website is under construction, the company’s Instagram description reads “We [sic] acquiring and rehabbing distressed real estate to achieve a higher point in sustainability and value in the community.” 

High Point Holdings did not respond to repeated requests for comment. 

“It’s to a point where they can’t have a venue there anymore,” Green said. “The landlord is neglecting the building so everyone moves out and it can be flipped, we think.” 

“This is a predatory landlord,” Nadkarni added. “Our club is being completely destroyed by someone who just cares about money.”  

Green said he worked with Nadkarni to urge district Supervisor Dean Preston to intervene, because it seemed to him that High Point Holdings had violated city code and may be subject to fines. 

Kyle Smeallie, Preston’s chief of staff, told The Standard he became acquainted with Nadkarni at a comedy show in the fall of 2022, where they discussed The Setup’s predicament. Soon after, Smeallie said he scheduled a site visit with Preston and saw the club’s “terrible conditions” firsthand. 

Preston’s office notified the Department of Building Inspection, which coordinated a site visit in November—at which point the case was elevated to the City Attorney’s Office to convene an inspection task force. 

Upon inspection, Smeallie said the Department of Public Health and the Fire Department issued violations to the property owner. Records from the Department of Building Inspection show six complaints between September 2022 and March 2023. The San Francisco Fire Department issued a code violation on Sept. 2. On Sept. 15, the building inspection department reported a site inspection revealing that sewage had flooded the space and the ceiling had collapsed. 

Smeallie explained that if the property owner fails to abate the violations, the city attorney can decide to sue them.

“Stepping back, it’s incredibly frustrating for a business owner who believes in the neighborhood to have been completely stymied by a property owner who seems to have no regard for their well-being or the tenants above the business,” Smeallie said. “We hope these steps will spur the owner to address these issues.”

Green said there has been no further follow-up from building inspections or the City Attorney’s Office, which he said he chalks up to the ills of bureaucracy.

“Never attribute to malice what can be adequately explained by incompetence,” Green said, quoting Robert J. Hanlon in Murphy's Law Book Two. “My feeling is that nothing is working. Instead of nightlife, we have just another blighted building in the Tenderloin.” 

Jen Kwart, a spokesperson for the city attorney, wrote in an email that her office is tracking The Setup’s case. “As in all of our code enforcement cases, we are working expeditiously with our client departments to ensure any code violations are cured and the space is safe for tenants, business owners, and the public to use.” 

When asked if it’s customary for a case like Nadkarni’s to be in a holding pattern for months, Smeallie said that while this timeline is not out of the ordinary, he shares Nadkarni’s frustration that things haven’t happened sooner.

“I think oftentimes the city tries to assume that a property owner is acting in good faith,” Smeallie said. “But I don’t think we’re operating with a property owner who’s acting in good faith.” 

The Standard spoke with Nadkarni the week before PianoFight, an independent arts venue located nearby in the Tenderloin, was slated to permanently shutter after amassing insurmountable debt during the pandemic. 

Nadkarni said he feels he’s at an impasse, as he can’t sink more money into remediating the damage himself. 

“I just want to tell jokes, but I’m being pulled into all of this city politics,” he said. 

Thinking up other ways to save his club, Nadkarni pointed to Mission District queer bar El Rio as a model for what the city could do for The Setup. In November 2017, the Small Business Commission granted El Rio legacy business status so it could receive grant funding and governmental assistance.  

El Rio opened in 1978 as a “leather Brazilian gay bar” and has been a neighborhood institution ever since. Likewise, before The Setup was a community hub for independent comedians, it served as the green room for the Black Hawk, a nightclub frequented by Miles Davis, Billie Holiday and John Coltrane between 1949 and 1963. 

Yet, Smeallie clarified that the legacy business process is reserved for businesses that have been in continuous operation for 30 years or more. 

“But we’re open if there are other ways for [The Setup] to get creative,” Smeallie said. 

Nadkarni said before he opened his club, local comedians told him not to host a show in the Tenderloin. But in the club’s heyday, around 500 people filtered through The Setup every week. He sees this success as a particular coup in San Francisco, where the independent comedy scene, he says, has been hollowed out in a corporate landscape where only outposts like The Punchline and Cobb’s—both of which are operated by the global entertainment conglomerate Live Nation—have proven sustainable.

Smeallie said he believes The Setup adds significant value to the neighborhood. 

“Everything that they do is crucial to making the Tenderloin the safe and vibrant neighborhood we know it can be,” Smeallie said.

For Nadkarni, The Setup’s survival is not just about his own community. It’s also about the Tenderloin itself—a neighborhood with a rich artistic history that he said has been overshadowed by issues like homelessness and crime. 

“There’s a lot of optimism that we need to reframe within the Tenderloin,” Nadkarni said. “The neighborhood can grow in a good direction.”