Kevin Truong

There’s plenty of doom to go around in San Francisco, but a doom loop remains a distant possibility. Instead, the near term may be a kind of purgatory as the city deals with the ramifications of a mass work culture shift and realigns its economy.

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There’s plenty of doom to go around in San Francisco, but a doom loop remains a distant possibility. Instead, the near term may be a kind of purgatory as the city deals with the ramifications of a mass work culture shift and realigns its economy.

A major theme of the University of California Berkeley event “From Doom to Boom in San Francisco” was the relationship between upheaval in the commercial real estate industry and the potential economic downward spiral for the city.

A major theme of the University of California Berkeley event “From Doom to Boom in San Francisco” was the relationship between upheaval in the commercial real estate industry and the potential economic downward spiral for the city.

During the peak of the tech boom, job growth rates were among the highest in the nation and office vacancies were at an all-time low as companies fiercely competed for limited space.

During the peak of the tech boom, job growth rates were among the highest in the nation and office vacancies were at an all-time low as companies fiercely competed for limited space.

READ MORE: <a href="https://sfstandard.com/2023/08/22/san-francisco-mayor-optimistic-says-downtown-is-primed-for-comeback/">San Francisco Doom Loop Reversal Ideas Include a Soccer Stadium, a UC Campus and a Carnival</a>

San Francisco doom loop reversal ideas include a soccer stadium, a UC campus and a carnival

READ MORE: <a href="https://sfstandard.com/2023/08/22/san-francisco-mayor-optimistic-says-downtown-is-primed-for-comeback/">San Francisco Doom Loop Reversal Ideas Include a Soccer Stadium, a UC Campus and a Carnival</a>

Now, vacancy rates have reached a record 34% and continue to trend higher, according to real estate firm CBRE. The lack of tenants in the market has combined with an interest rate environment that has made it difficult to build or sell properties.

Now, vacancy rates have reached a record 34% and continue to trend higher, according to real estate firm CBRE. The lack of tenants in the market has combined with an interest rate environment that has made it difficult to build or sell properties.

“I think the doom per se is sort of a given, but the loop question is an interesting one,” said Ted Egan, San Francisco’s chief economist.

“I think the doom per se is sort of a given, but the loop question is an interesting one,” said Ted Egan, San Francisco’s chief economist.

Egan said while there are plenty of factors weighing down the city’s economy, issues that have plagued other “doom loop" cities, along with population outflows and skyrocketing unemployment, have not materialized in San Francisco.

Egan said while there are plenty of factors weighing down the city’s economy, issues that have plagued other “doom loop" cities, along with population outflows and skyrocketing unemployment, have not materialized in San Francisco.

However, what will materialize are <a href="https://sfstandard.com/2023/10/11/san-francisco-mayor-orders-budget-cuts/">painful budget cuts</a>.&nbsp;

San Francisco mayor says budget cuts &#8216;cannot wait&#8217; as $500M deficit looms

However, what will materialize are <a href="https://sfstandard.com/2023/10/11/san-francisco-mayor-orders-budget-cuts/">painful budget cuts</a>.&nbsp;

By fiscal year 2027-28, the city estimates a $1.2 billion-plus budget deficit due in large part to a decline in tax revenue from commercial real estate.

By fiscal year 2027-28, the city estimates a $1.2 billion-plus budget deficit due in large part to a decline in tax revenue from commercial real estate.

“It’s not the kind of thing we haven’t faced before,” Egan said, adding that per-capita tax revenue has doubled in the last 20 years. “It certainly doesn’t seem inevitable to me that the city is going to have to cut the kinds of services that are going to make people say I just don’t like San Francisco anymore.”

“It’s not the kind of thing we haven’t faced before,” Egan said, adding that per-capita tax revenue has doubled in the last 20 years. “It certainly doesn’t seem inevitable to me that the city is going to have to cut the kinds of services that are going to make people say I just don’t like San Francisco anymore.”

Egan also pointed out countervailing forces like lower rents and housing costs, which could attract new businesses and residents. He added that while drug use and homelessness are often raised as evidence of the doom loop spiral, he’s skeptical.

Egan also pointed out countervailing forces like lower rents and housing costs, which could attract new businesses and residents. He added that while drug use and homelessness are often raised as evidence of the doom loop spiral, he’s skeptical.

“These are long-standing problems in San Francisco, and it hasn’t in the past affected people commuting to Downtown office buildings,” Egan said. “It’s a great conversation to have. It’s just not a great explanation for San Francisco's economic problems.”

“These are long-standing problems in San Francisco, and it hasn’t in the past affected people commuting to Downtown office buildings,” Egan said. “It’s a great conversation to have. It’s just not a great explanation for San Francisco's economic problems.”

<h2 class="wp-block-heading" id="h-hybrid-work-here-to-stay">Hybrid Work Here To Stay</h2>

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<h2 class="wp-block-heading" id="h-hybrid-work-here-to-stay">Hybrid Work Here To Stay</h2>

Instead, the experts agreed that the key to these economic challenges is a shift toward working from home. Panelist Nicholas Bloom, a Stanford University economist who became known during the pandemic for his prescient research around remote work, recently published a New York Times op-ed titled “<a href="https://www.nytimes.com/2023/10/16/opinion/office-work-home-remote.html" target="_blank" rel="noreferrer noopener">The Five-Day Office Week Is Dead</a>.”

Instead, the experts agreed that the key to these economic challenges is a shift toward working from home. Panelist Nicholas Bloom, a Stanford University economist who became known during the pandemic for his prescient research around remote work, recently published a New York Times op-ed titled “<a href="https://www.nytimes.com/2023/10/16/opinion/office-work-home-remote.html" target="_blank" rel="noreferrer noopener">The Five-Day Office Week Is Dead</a>.”

“I know the media is full of stories like apparently <a href="https://www.google.com/search?q=Zoom+is+calling+everyone+back+in+the+office+sfstandard&amp;sca_esv=578269931&amp;rlz=1C5GCEM_en&amp;ei=u3ZBZbqrH4_A0PEP7bqomA4&amp;ved=0ahUKEwj69NqvoqGCAxUPIDQIHW0dCuMQ4dUDCBE&amp;uact=5&amp;oq=Zoom+is+calling+everyone+back+in+the+office+sfstandard&amp;gs_lp=Egxnd3Mtd2l6LXNlcnAaAhgCIjZab29tIGlzIGNhbGxpbmcgZXZlcnlvbmUgYmFjayBpbiB0aGUgb2ZmaWNlIHNmc3RhbmRhcmQyBRAhGKABMgUQIRigATIFECEYoAFIiixQnwNYjShwBHgBkAEAmAHXAqABmAuqAQcwLjMuMy4xuAEDyAEA-AEBwgINEAAYRxjWBBiwAxiLA8ICEBAAGEcY1gQYyQMYsAMYiwPCAg4QABiKBRiSAxiwAxiLA8ICBRAhGKsC4gMEGAAgQYgGAZAGCQ&amp;sclient=gws-wiz-serp">Zoom is calling everyone back in the office</a>,” Bloom said. “If you look at the big data, that’s just not true.”

“I know the media is full of stories like apparently <a href="https://www.google.com/search?q=Zoom+is+calling+everyone+back+in+the+office+sfstandard&amp;sca_esv=578269931&amp;rlz=1C5GCEM_en&amp;ei=u3ZBZbqrH4_A0PEP7bqomA4&amp;ved=0ahUKEwj69NqvoqGCAxUPIDQIHW0dCuMQ4dUDCBE&amp;uact=5&amp;oq=Zoom+is+calling+everyone+back+in+the+office+sfstandard&amp;gs_lp=Egxnd3Mtd2l6LXNlcnAaAhgCIjZab29tIGlzIGNhbGxpbmcgZXZlcnlvbmUgYmFjayBpbiB0aGUgb2ZmaWNlIHNmc3RhbmRhcmQyBRAhGKABMgUQIRigATIFECEYoAFIiixQnwNYjShwBHgBkAEAmAHXAqABmAuqAQcwLjMuMy4xuAEDyAEA-AEBwgINEAAYRxjWBBiwAxiLA8ICEBAAGEcY1gQYyQMYsAMYiwPCAg4QABiKBRiSAxiwAxiLA8ICBRAhGKsC4gMEGAAgQYgGAZAGCQ&amp;sclient=gws-wiz-serp">Zoom is calling everyone back in the office</a>,” Bloom said. “If you look at the big data, that’s just not true.”

Bloom argues hybrid work is the way of the future and cited research showing work patterns stabilizing at around 28% of days at home. According to survey data, workers equate working from home two to three days a week to about 8% more pay.

Bloom argues hybrid work is the way of the future and cited research showing work patterns stabilizing at around 28% of days at home. According to survey data, workers equate working from home two to three days a week to about 8% more pay.

A pattern that has emerged from the hybrid shift is a “donut effect” of people moving out of downtowns and into surrounding suburbs.&nbsp;

A pattern that has emerged from the hybrid shift is a “donut effect” of people moving out of downtowns and into surrounding suburbs.&nbsp;

“San Francisco is stable,” Bloom said. “It’s had a big negative shock, but I don’t think it’s in a doom loop. I think it’s down, but it’s definitely not out.”

“San Francisco is stable,” Bloom said. “It’s had a big negative shock, but I don’t think it’s in a doom loop. I think it’s down, but it’s definitely not out.”

READ MORE: <a href="https://sfstandard.com/2023/06/06/breaking-the-doom-loop-san-francisco-lawmakers-back-sweeping-changes-for-small-business/">Breaking the Doom Loop: San Francisco Lawmakers Back Sweeping Changes for Small Business</a>

Breaking the doom loop: San Francisco lawmakers back sweeping changes for small business

READ MORE: <a href="https://sfstandard.com/2023/06/06/breaking-the-doom-loop-san-francisco-lawmakers-back-sweeping-changes-for-small-business/">Breaking the Doom Loop: San Francisco Lawmakers Back Sweeping Changes for Small Business</a>

One quirk has been a rise in people playing golf during the day. That could presage how cities need to move away from office-work-centered economies, Bloom said.

One quirk has been a rise in people playing golf during the day. That could presage how cities need to move away from office-work-centered economies, Bloom said.

“There’s been a swiveling of time use,” Bloom said. “The key to me is cities rotating more towards consumption activities and leisure and a bit away from offices.”

“There’s been a swiveling of time use,” Bloom said. “The key to me is cities rotating more towards consumption activities and leisure and a bit away from offices.”

Not everything had a sunny side. The <a href="https://sfstandard.com/search/?query=transit%20">future of public transit</a>—which has seen steep ridership declines—was a common cause for concern. So, too, was the outflow of lower-income service workers that would enable a shift to a leisure-based economy.

Not everything had a sunny side. The <a href="https://sfstandard.com/search/?query=transit%20">future of public transit</a>—which has seen steep ridership declines—was a common cause for concern. So, too, was the outflow of lower-income service workers that would enable a shift to a leisure-based economy.

Nancy Wallace, a UC Berkeley real estate economist, said new federal funding could provide dollars for environmentally beneficial projects in addition to state tax credits and local tax incentives.

Nancy Wallace, a UC Berkeley real estate economist, said new federal funding could provide dollars for environmentally beneficial projects in addition to state tax credits and local tax incentives.

While she’s skeptical of a wave of conversions turning office buildings into housing, Wallace said repositioning older offices into innovation hubs could be a strategy for a region still dominant in startup funding and activity.

While she’s skeptical of a wave of conversions turning office buildings into housing, Wallace said repositioning older offices into innovation hubs could be a strategy for a region still dominant in startup funding and activity.

That could be part of a larger economic revitalization strategy for Downtown enabled by lower building values, which includes the promotion of 3D printing manufacturing, AI innovation and research offices, satellite university campuses and other research labs.

That could be part of a larger economic revitalization strategy for Downtown enabled by lower building values, which includes the promotion of 3D printing manufacturing, AI innovation and research offices, satellite university campuses and other research labs.

Doom loop fears have meant cities are more willing to limit restrictions for investment and development, even in San Francisco, a city notorious for its bureaucratic barriers.

Doom loop fears have meant cities are more willing to limit restrictions for investment and development, even in San Francisco, a city notorious for its bureaucratic barriers.

“If you’re in this business, you know that there is dry capital waiting to come into the markets—here’s actually quite a lot," Wallace said. “The other interesting thing is the cities are now wanting to be accommodated, even San Francisco.”

“If you’re in this business, you know that there is dry capital waiting to come into the markets—here’s actually quite a lot," Wallace said. “The other interesting thing is the cities are now wanting to be accommodated, even San Francisco.”

Downtown San Francisco’s future? More innovation and fun, fewer offices

Julie Zigoris

Can <a href="https://sf.gov/news/san-francisco-debuts-new-outdoor-roller-rink-civic-center-0" target="_blank" rel="noreferrer noopener">roller disco</a>, <a href="https://downtownsf.org/things-to-do/lets-glow-sf" target="_blank" rel="noreferrer noopener">light shows</a> and winter <a href="https://www.sfstandard.com/2022/12/04/san-francisco-hallidie-plaza-now-winter-wanderland/">wonderland</a> displays save Downtown San Francisco? City Hall believes they can—and has put money behind them to make it happen.&nbsp;

Can <a href="https://sf.gov/news/san-francisco-debuts-new-outdoor-roller-rink-civic-center-0" target="_blank" rel="noreferrer noopener">roller disco</a>, <a href="https://downtownsf.org/things-to-do/lets-glow-sf" target="_blank" rel="noreferrer noopener">light shows</a> and winter <a href="https://www.sfstandard.com/2022/12/04/san-francisco-hallidie-plaza-now-winter-wanderland/">wonderland</a> displays save Downtown San Francisco? City Hall believes they can—and has put money behind them to make it happen.&nbsp;

The Office of Economic and Workforce Development said it has begun issuing grants to support arts and entertainment activities Downtown as part of Mayor London Breed’s initiative to create an <a href="https://sf.gov/reports/may-2023/transform-downtown-leading-arts-culture-and-nightlife-destination" target="_blank" rel="noreferrer noopener">Arts, Culture and Entertainment Zone</a>, also known as ACE. The idea is to encourage existing businesses with fee and tax relief, streamlined permits and marketing support, and provide “incentives to foster new arts and culture establishments.”

The Office of Economic and Workforce Development said it has begun issuing grants to support arts and entertainment activities Downtown as part of Mayor London Breed’s initiative to create an <a href="https://sf.gov/reports/may-2023/transform-downtown-leading-arts-culture-and-nightlife-destination" target="_blank" rel="noreferrer noopener">Arts, Culture and Entertainment Zone</a>, also known as ACE. The idea is to encourage existing businesses with fee and tax relief, streamlined permits and marketing support, and provide “incentives to foster new arts and culture establishments.”

The strategy is part of the city’s “<a href="https://sf.gov/news/mayor-breed-announces-roadmap-downtown-san-franciscos-future" target="_blank" rel="noreferrer noopener">Roadmap to Downtown San Francisco’s Future,</a>” an effort to break the notorious “doom loop” that’s left the city’s economic and cultural center riddled with underused office buildings and empty storefronts.&nbsp;

The strategy is part of the city’s “<a href="https://sf.gov/news/mayor-breed-announces-roadmap-downtown-san-franciscos-future" target="_blank" rel="noreferrer noopener">Roadmap to Downtown San Francisco’s Future,</a>” an effort to break the notorious “doom loop” that’s left the city’s economic and cultural center riddled with underused office buildings and empty storefronts.&nbsp;

The initiative is long on fun ideas and ambitious plans but short on specifics on how to achieve them. Six months on, the boundaries of the ACE zone have yet to be defined, and little to no progress has been made toward streamlining permits and easing fees, improvements business owners say are badly needed.&nbsp;

The initiative is long on fun ideas and ambitious plans but short on specifics on how to achieve them. Six months on, the boundaries of the ACE zone have yet to be defined, and little to no progress has been made toward streamlining permits and easing fees, improvements business owners say are badly needed.&nbsp;

Nor is it clear how one strategy will work across an area that includes several distinct neighborhoods with diverse challenges ranging from an <a href="https://www.sfstandard.com/2023/06/29/the-grim-state-of-downtown-san-francisco-by-the-numbers/">exodus of office workers </a>in the Financial District to high-profile <a href="https://sfstandard.com/2023/02/09/louis-vuitton-looter-gets-prison-time-for-union-square-thefts/">smash-and-grab </a>thefts in Union Square to open-air drug markets in the Tenderloin and Mid-Market neighborhoods.&nbsp;&nbsp;

Louis Vuitton looter gets prison time for Union Square thefts

Nor is it clear how one strategy will work across an area that includes several distinct neighborhoods with diverse challenges ranging from an <a href="https://www.sfstandard.com/2023/06/29/the-grim-state-of-downtown-san-francisco-by-the-numbers/">exodus of office workers </a>in the Financial District to high-profile <a href="https://sfstandard.com/2023/02/09/louis-vuitton-looter-gets-prison-time-for-union-square-thefts/">smash-and-grab </a>thefts in Union Square to open-air drug markets in the Tenderloin and Mid-Market neighborhoods.&nbsp;&nbsp;

The process will take time, said Kia Kolderup-Lane, communications manager for the Office of Economic and Workforce Development. “There’s a lot of stakeholders involved,” she said. “And they all want to be part of these ACE Zones.”&nbsp;

The process will take time, said Kia Kolderup-Lane, communications manager for the Office of Economic and Workforce Development. “There’s a lot of stakeholders involved,” she said. “And they all want to be part of these ACE Zones.”&nbsp;

<h2 class="wp-block-heading" id="h-tourist-trap">Tourist Trap</h2>

Amid all that dark news, city officials are clinging to a silver lining in the form of recent numbers showing tourism has been roaring back in the city. Union Square, San Francisco’s upscale shopping and hotel district, has enjoyed a comeback since the bleak days of the pandemic, with a 22% <a href="https://mcusercontent.com/2bf1f68595f7fd5371df645be/files/f59a8d02-79c8-2a87-0e39-f508f0d7bbf7/June_Footfall_Report.pdf" target="_blank" rel="noreferrer noopener">jump</a> in foot traffic since last year. Visitor spending is also expected to continue to grow in 2023, up from the $522 million in tourism-generated fees and tax revenues delivered to the city last year, according to a <a href="https://www.sftravel.com/media/press-release/san-francisco-travel-association-announces-2022-results-2023-forecast" target="_blank" rel="noreferrer noopener">report</a> by San Francisco Travel.&nbsp;

Amid all that dark news, city officials are clinging to a silver lining in the form of recent numbers showing tourism has been roaring back in the city. Union Square, San Francisco’s upscale shopping and hotel district, has enjoyed a comeback since the bleak days of the pandemic, with a 22% <a href="https://mcusercontent.com/2bf1f68595f7fd5371df645be/files/f59a8d02-79c8-2a87-0e39-f508f0d7bbf7/June_Footfall_Report.pdf" target="_blank" rel="noreferrer noopener">jump</a> in foot traffic since last year. Visitor spending is also expected to continue to grow in 2023, up from the $522 million in tourism-generated fees and tax revenues delivered to the city last year, according to a <a href="https://www.sftravel.com/media/press-release/san-francisco-travel-association-announces-2022-results-2023-forecast" target="_blank" rel="noreferrer noopener">report</a> by San Francisco Travel.&nbsp;

Nightlife and entertainment are clearly helping to drive this turnaround.&nbsp;

Nightlife and entertainment are clearly helping to drive this turnaround.&nbsp;

The recent series of final concerts by Grateful Dead spinoff band <a href="https://www.sfstandard.com/2023/07/15/grateful-dead-final-shows-san-francisco-hippy-mecca/">Dead &amp; Company</a> brought in an estimated $30.9 million, with 18,296 overnight paid accommodations, according to the Destinations International Event Impact Calculator.

The recent series of final concerts by Grateful Dead spinoff band <a href="https://www.sfstandard.com/2023/07/15/grateful-dead-final-shows-san-francisco-hippy-mecca/">Dead &amp; Company</a> brought in an estimated $30.9 million, with 18,296 overnight paid accommodations, according to the Destinations International Event Impact Calculator.

A composite image of Allan Nealis, left, shopping for tie-dye at a pop up market ahead of the final Dead &amp; Company performance outside of Oracle Park on Friday, July 14, 2023 and Dead &amp; Company’s Bob Weir, right, performing onstage later that weekend. |The Standard

<figure class="wp-block-image size-large"><img src="https://content.sfstandard.com/wp-content/uploads/2023/07/INLINED004_DowntownBarsThriving06092023.jpg?w=2500" alt="" class="wp-image-184225"/><figcaption class="wp-element-caption">A composite image of Allan Nealis, left, shopping for tie-dye at a pop-up market ahead of the final Dead &amp; Company performance outside of Oracle Park on Friday, July 14, 2023, and Dead &amp; Company’s Bob Weir, right, performing onstage later that weekend. </figcaption></figure>

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<figure class="wp-block-image size-large"><img src="https://content.sfstandard.com/wp-content/uploads/2023/07/INLINED004_DowntownBarsThriving06092023.jpg?w=2500" alt="" class="wp-image-184225"/><figcaption class="wp-element-caption">A composite image of Allan Nealis, left, shopping for tie-dye at a pop-up market ahead of the final Dead &amp; Company performance outside of Oracle Park on Friday, July 14, 2023, and Dead &amp; Company’s Bob Weir, right, performing onstage later that weekend. </figcaption></figure>

“You couldn’t walk a foot without seeing tie dye,” said Jill Plemons, director of sales and marketing at the Beacon Grand Hotel near Union Square.&nbsp;

“You couldn’t walk a foot without seeing tie dye,” said Jill Plemons, director of sales and marketing at the Beacon Grand Hotel near Union Square.&nbsp;

While the average rate of hotel occupancy in San Francisco has hovered around 60%, it soared to 90% during the concert series weekend, according to Alex Bastian, president and CEO of the Hotel Council of San Francisco. The rate was just 8% at the height of the pandemic.

While the average rate of hotel occupancy in San Francisco has hovered around 60%, it soared to 90% during the concert series weekend, according to Alex Bastian, president and CEO of the Hotel Council of San Francisco. The rate was just 8% at the height of the pandemic.

“You have to remember that was only 16 months ago,” Bastian said.

“You have to remember that was only 16 months ago,” Bastian said.

One-off events like the <a href="https://visitunionsquaresf.com/union-square-in-bloom-2" target="_blank" rel="noreferrer noopener">125th anniversary of the Ferry Building</a> and the <a href="https://visitunionsquaresf.com/union-square-in-bloom-2">March tulip giveaway</a> in Union Square—where organizers were so inundated they ran out of blooms two hours early—and pop-up concerts by Sofar Sounds at the Beacon Grand Hotel’s new lounge have also drawn crowds.&nbsp;

One-off events like the <a href="https://visitunionsquaresf.com/union-square-in-bloom-2" target="_blank" rel="noreferrer noopener">125th anniversary of the Ferry Building</a> and the <a href="https://visitunionsquaresf.com/union-square-in-bloom-2">March tulip giveaway</a> in Union Square—where organizers were so inundated they ran out of blooms two hours early—and pop-up concerts by Sofar Sounds at the Beacon Grand Hotel’s new lounge have also drawn crowds.&nbsp;

People gather in front of City Hall to watch live performances near Civic Center in San Francisco for Pride weekend on Sunday, June 26th, 2022.  

<figure class="wp-block-image size-large"><img src="https://content.sfstandard.com/wp-content/uploads/2023/07/INLINED_NEW_DowntownBarsThriving06092023.jpg?w=2500" alt="" class="wp-image-185583"/><figcaption class="wp-element-caption">People gather in front of San Francisco City Hall to watch live performances during Pride weekend on June 26. </figcaption></figure>

A survey conducted after the second <a href="https://sfstandard.com/2023/04/09/san-franciscos-newest-plan-to-resurrect-downtown-involves-indian-dancing/">Bhangra &amp; Beats</a> <a href="https://www.tiktok.com/@sfstandard/video/7256927238463966506?lang=en">night market</a> revealed that people spent an average of $89 in the surrounding area, and the first two events brought more than 10,000 people each night.&nbsp;

San Francisco’s newest plan to resurrect downtown involves Indian dancing

A survey conducted after the second <a href="https://sfstandard.com/2023/04/09/san-franciscos-newest-plan-to-resurrect-downtown-involves-indian-dancing/">Bhangra &amp; Beats</a> <a href="https://www.tiktok.com/@sfstandard/video/7256927238463966506?lang=en">night market</a> revealed that people spent an average of $89 in the surrounding area, and the first two events brought more than 10,000 people each night.&nbsp;

<h2 class="wp-block-heading" id="h-everyday-people-nbsp">Everyday People&nbsp;</h2>

But tourism alone can’t solve Downtown San Francisco’s problems, say local business owners. Many of them are struggling to keep their doors open. Destinations like the Tiki bar Pagan Idol and the jazz venue the Dawn Club have been staging comebacks thanks to the recent surge in out-of-town visitors, said owner Brian Sheehy, who owns 14 bars across the city, many of them clustered Downtown.

But tourism alone can’t solve Downtown San Francisco’s problems, say local business owners. Many of them are struggling to keep their doors open. Destinations like the Tiki bar Pagan Idol and the jazz venue the Dawn Club have been staging comebacks thanks to the recent surge in out-of-town visitors, said owner Brian Sheehy, who owns 14 bars across the city, many of them clustered Downtown.

On the other hand, Sheehy said establishments he owns, like the Rickhouse on Kearny Street and Nightingale, which is modeled after a 1970s fern bar, survived in the past mainly on a happy hour crowd that no longer exists following the rise of remote work that has shaken Downtown San Francisco’s economy. Those spots have, in turn, fallen on hard times.&nbsp;

On the other hand, Sheehy said establishments he owns, like the Rickhouse on Kearny Street and Nightingale, which is modeled after a 1970s fern bar, survived in the past mainly on a happy hour crowd that no longer exists following the rise of remote work that has shaken Downtown San Francisco’s economy. Those spots have, in turn, fallen on hard times.&nbsp;

Still, Sheehy remains an optimist, countering the negative press that has battered the city in recent months with ironic initiatives like “Doomloopin Bowling,” a cheeky game he organized to raise morale among his staff.

Still, Sheehy remains an optimist, countering the negative press that has battered the city in recent months with ironic initiatives like “Doomloopin Bowling,” a cheeky game he organized to raise morale among his staff.

A composite image of Dawn Club co-owners Brian Sheehy and Doug Dalton presenting the Doomloopin Bowling trophy and Jorge Gutierrez rolling a ball towards the goal just outside the Dawn Club in San Francisco. | Isaac Ceja/The Standard

<figure class="wp-block-image size-large"><img src="https://content.sfstandard.com/wp-content/uploads/2023/07/INLINED001_DowntownBarsThriving06092023.jpg?w=2467" alt="" class="wp-image-184222"/><figcaption class="wp-element-caption">A composite image of Dawn Club co-owners Brian Sheehy and Doug Dalton presenting the Doomloopin Bowling trophy and Jorge Gutierrez rolling a ball toward the goal just outside the Dawn Club in San Francisco. </figcaption></figure>

Yet, Sheehy said he has been waiting for an outdoor seating permit at the Dawn Club since last November. He was echoing small business owners <a href="https://sfstandard.com/2021/01/13/cielito-lindo-restaurant-four-years-to-open-permitting-process/">who have long complained</a> about the excessive red tape imposed on them by city government. California lawmakers <a href="https://www.kron4.com/news/bay-area/assembly-rejects-keeping-san-francisco-bars-open-past-2-a-m/">rejected</a> a 2022 bill that would have allowed bars to stay open past 2 a.m. However, San Francisco officials are backing a proposed state law that would allow the sale of alcohol outdoors in designated “Entertainment Zones.”&nbsp;&nbsp;

Why Outer Richmond&#8217;s Cielito Lindo took four years to launch

Yet, Sheehy said he has been waiting for an outdoor seating permit at the Dawn Club since last November. He was echoing small business owners <a href="https://sfstandard.com/2021/01/13/cielito-lindo-restaurant-four-years-to-open-permitting-process/">who have long complained</a> about the excessive red tape imposed on them by city government. California lawmakers <a href="https://www.kron4.com/news/bay-area/assembly-rejects-keeping-san-francisco-bars-open-past-2-a-m/">rejected</a> a 2022 bill that would have allowed bars to stay open past 2 a.m. However, San Francisco officials are backing a proposed state law that would allow the sale of alcohol outdoors in designated “Entertainment Zones.”&nbsp;&nbsp;

Sheehy and other business owners say such reforms can’t come soon enough. With retail and office vacancies <a href="https://www.sfstandard.com/2023/06/29/the-grim-state-of-downtown-san-francisco-by-the-numbers/">exceeding 30%</a> and San Francisco struggling with one of the <a href="https://www.sfstandard.com/2023/02/28/sf-metro-area-pandemic-recovery-among-the-worst-in-us/">slowest pandemic recoveries</a> in the nation, local business owners say the negative press about the city has only hampered the efforts to resuscitate it.&nbsp;

Sheehy and other business owners say such reforms can’t come soon enough. With retail and office vacancies <a href="https://www.sfstandard.com/2023/06/29/the-grim-state-of-downtown-san-francisco-by-the-numbers/">exceeding 30%</a> and San Francisco struggling with one of the <a href="https://www.sfstandard.com/2023/02/28/sf-metro-area-pandemic-recovery-among-the-worst-in-us/">slowest pandemic recoveries</a> in the nation, local business owners say the negative press about the city has only hampered the efforts to resuscitate it.&nbsp;

“We don’t need any more bars and restaurants; we don’t need more cafes,” Sheehy said. “We need to work on saving the ones that are barely hanging on right now.”&nbsp;

“We don’t need any more bars and restaurants; we don’t need more cafes,” Sheehy said. “We need to work on saving the ones that are barely hanging on right now.”&nbsp;

A composite image of an exterior of House of Shields, left, and people enjoying drinks at the Dawn Club, right, in Downtown San Francisco. | Isaac Ceja/The Standard

<figure class="wp-block-image size-large"><img src="https://content.sfstandard.com/wp-content/uploads/2023/07/INLINED006_DowntownBarsThriving06092023.jpg?w=2500" alt="" class="wp-image-184227"/><figcaption class="wp-element-caption">A composite image of an exterior of House of Shields, left, and people enjoying drinks at the Dawn Club, right, in Downtown San Francisco. </figcaption></figure>

Max Young is another bar owner who has experienced San Francisco’s problems firsthand. He’s been operating drinking establishments in San Francisco since the 1990s, running popular spots like the Del Mar and the Bamboo Hut in North Beach.&nbsp;

Max Young is another bar owner who has experienced San Francisco’s problems firsthand. He’s been operating drinking establishments in San Francisco since the 1990s, running popular spots like the Del Mar and the Bamboo Hut in North Beach.&nbsp;

He opened the bar and club Mr. Smith’s on Seventh Street off Market Street about two decades ago when the neighborhood was up and coming. “It was like the United Nations,” Young said. “There was a little bit of everyone there.”&nbsp;

He opened the bar and club Mr. Smith’s on Seventh Street off Market Street about two decades ago when the neighborhood was up and coming. “It was like the United Nations,” Young said. “There was a little bit of everyone there.”&nbsp;

He remembered watching the neighborhood improve: Yelp took off, smaller tech companies moved in, and the Federal Building was constructed.&nbsp;

He remembered watching the neighborhood improve: Yelp took off, smaller tech companies moved in, and the Federal Building was constructed.&nbsp;

“I watched it come back after 50 years of nothing,” Young said.&nbsp;

“I watched it come back after 50 years of nothing,” Young said.&nbsp;

But things changed around 2015 when drug dealers multiplied, he said, and his customers and staff felt unsafe. Mr. Smith’s closed in 2019.&nbsp;

But things changed around 2015 when drug dealers multiplied, he said, and his customers and staff felt unsafe. Mr. Smith’s closed in 2019.&nbsp;

“It became a full-time job to try to change this tide,” he said.

“It became a full-time job to try to change this tide,” he said.

Guests drink at PianoFight’s bar in San Francisco on Thursday, Mar. 9, 2023. 

<figure class="wp-block-image size-large"><img src="https://content.sfstandard.com/wp-content/uploads/2023/07/INLINED_NEW2_DowntownBarsThriving06092023.jpg?w=2500" alt="" class="wp-image-185587"/><figcaption class="wp-element-caption">Guests drink at PianoFight’s bar in San Francisco in March. </figcaption></figure>

He wasn’t alone. PianoFight, a popular neighboring spot near Mid-Market, <a href="https://sfstandard.com/2023/01/24/popular-venue-to-close-two-bay-area-locations/">closed down</a> this year, unable to recover from the effects of the pandemic.&nbsp;

Popular venue to close two Bay Area locations

He wasn’t alone. PianoFight, a popular neighboring spot near Mid-Market, <a href="https://sfstandard.com/2023/01/24/popular-venue-to-close-two-bay-area-locations/">closed down</a> this year, unable to recover from the effects of the pandemic.&nbsp;

“Nightlife can help Downtown for sure,” Young said. “But it can’t be the only thing. It needs to be part of a much larger puzzle.”&nbsp;

“Nightlife can help Downtown for sure,” Young said. “But it can’t be the only thing. It needs to be part of a much larger puzzle.”&nbsp;

Whatever the challenges, some believe recasting Downtown as a fun place to go for nightlife and the arts is returning San Francisco to its former reputation as a bohemian haven for offbeat creatives.&nbsp;

Whatever the challenges, some believe recasting Downtown as a fun place to go for nightlife and the arts is returning San Francisco to its former reputation as a bohemian haven for offbeat creatives.&nbsp;

Ben Bleiman, chair of the San Francisco Entertainment Commission, at Soda Popinski's in San Francisco. | Juliana Yamada/The Standard

<figure class="wp-block-image size-large"><img src="https://content.sfstandard.com/wp-content/uploads/2023/07/INLINED003_DowntownBarsThriving06092023.jpg?w=2500" alt="" class="wp-image-184224"/><figcaption class="wp-element-caption">Ben Bleiman, chair of the San Francisco Entertainment Commission, at Soda Popinski's in San Francisco. </figcaption></figure>

Ben Bleiman, who sits on the city’s Entertainment Commission and owns the San Francisco bars Tonic, Bullitt and Teeth, welcomes the idea of a central city hub that caters to the business and entertainment needs of the city’s locals rather than those of big companies, adding that his commentary was not on behalf of the Entertainment Commission.&nbsp;

Ben Bleiman, who sits on the city’s Entertainment Commission and owns the San Francisco bars Tonic, Bullitt and Teeth, welcomes the idea of a central city hub that caters to the business and entertainment needs of the city’s locals rather than those of big companies, adding that his commentary was not on behalf of the Entertainment Commission.&nbsp;

“Multinational corporations didn’t always own Downtown San Francisco,” Bleiman said. “Fuck them—they swooped into town and didn’t care about us.”

“Multinational corporations didn’t always own Downtown San Francisco,” Bleiman said. “Fuck them—they swooped into town and didn’t care about us.”

Downtown San Francisco: Will soaring retail vacancies create room for fun?

Josh Koehn

Mark Farrell came out swinging in his campaign kickoff Tuesday to regain the title of San Francisco mayor, taking shots at <a href="https://sfstandard.com/2023/06/20/london-breed-mayor-san-francisco-drugs-homelessness-crime-economy-election/">Mayor London Breed</a> and <a href="https://sfstandard.com/2024/02/13/mark-farrell-san-francisco-mayor-police-homeless/">pledging to fire the police chief</a>.

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Mark Farrell vows to fire police chief, clear homeless camps as mayor

Mark Farrell came out swinging in his campaign kickoff Tuesday to regain the title of San Francisco mayor, taking shots at <a href="https://sfstandard.com/2023/06/20/london-breed-mayor-san-francisco-drugs-homelessness-crime-economy-election/">Mayor London Breed</a> and <a href="https://sfstandard.com/2024/02/13/mark-farrell-san-francisco-mayor-police-homeless/">pledging to fire the police chief</a>.

But one of the most passionate calls to action by the former supervisor and 44th mayor of the city came when Farrell addressed the Grim Reaper of narratives plaguing San Francisco: the <a href="https://sfstandard.com/search/?query=doom%20loop">doom loop</a>.&nbsp;

But one of the most passionate calls to action by the former supervisor and 44th mayor of the city came when Farrell addressed the Grim Reaper of narratives plaguing San Francisco: the <a href="https://sfstandard.com/search/?query=doom%20loop">doom loop</a>.&nbsp;

City officials and business leaders have fretted over whether San Francisco’s budget crisis, an exodus of residents, and a cratering commercial real estate market will tip San Francisco over a fiscal cliff that will fuel an irrevocable downward spiral.

City officials and business leaders have fretted over whether San Francisco’s budget crisis, an exodus of residents, and a cratering commercial real estate market will tip San Francisco over a fiscal cliff that will fuel an irrevocable downward spiral.

Farrell suggested those fears have already been realized.

Farrell suggested those fears have already been realized.

“We have a doom loop, and we are losing our mantle as a world-class city,” Farrell said. “We are literally now being compared to Detroit and Oakland. That is not the conversation where San Francisco belongs. We know we can’t increase the vibrancy of our local economy without first tackling public safety and the conditions of our streets.”

“We have a doom loop, and we are losing our mantle as a world-class city,” Farrell said. “We are literally now being compared to Detroit and Oakland. That is not the conversation where San Francisco belongs. We know we can’t increase the vibrancy of our local economy without first tackling public safety and the conditions of our streets.”

Part of Farrell’s plan to reinvigorate the local economy includes slashing local business taxes for companies that make less than $5 million in annual revenue, but a more buzzy plan would involve rescinding a 2019 decision to <a href="https://sfstandard.com/2023/12/05/san-francisco-market-street-pandemic-big-plans-collapsed/">ban private vehicles from Market Street</a>, the city’s main downtown corridor.

Did car-free Market Street kill San Francisco’s most important boulevard?

Part of Farrell’s plan to reinvigorate the local economy includes slashing local business taxes for companies that make less than $5 million in annual revenue, but a more buzzy plan would involve rescinding a 2019 decision to <a href="https://sfstandard.com/2023/12/05/san-francisco-market-street-pandemic-big-plans-collapsed/">ban private vehicles from Market Street</a>, the city’s main downtown corridor.

“It’s actually scary how empty downtown is,” Farrell said. “We need to do everything possible to create throughput and commerce and bring people back and welcome people back to the downtown core. It’s a small step, but it’s a meaningful step.”

“It’s actually scary how empty downtown is,” Farrell said. “We need to do everything possible to create throughput and commerce and bring people back and welcome people back to the downtown core. It’s a small step, but it’s a meaningful step.”

A night view of Ferry Building and Market Street during rainy weather on December 30, 2022 in San Francisco.  The region was hit by a storm that included heavy rain, flooding and an atmospheric river.

<figure class="wp-block-image size-large"><img src="https://content.sfstandard.com/wp-content/uploads/2024/02/inlined02_downtownborders_011923.jpg?w=2500" alt="A long view of a commercial corridor at night. The streets are empty and lit with streetlights. " class="wp-image-247480"/><figcaption class="wp-element-caption">Critics of the Market Street car ban say it's contributed to a desolate feeling in downtown San Francisco.</figcaption></figure>

Arpit Gupta, an associate professor of finance at the New York University Stern School of Business, was among the first to bring the term “doom loop” back into the lexicon in a study looking at the shift to remote work during the pandemic and the harm it could cause when coupled with an “office real estate apocalypse.”

Arpit Gupta, an associate professor of finance at the New York University Stern School of Business, was among the first to bring the term “doom loop” back into the lexicon in a study looking at the shift to remote work during the pandemic and the harm it could cause when coupled with an “office real estate apocalypse.”

Many workers have not returned to San Francisco’s downtown offices since the start of the pandemic, and the city’s commercial real estate vacancy rate climbed to <a href="https://www.sfchronicle.com/realestate/article/s-f-office-vacancy-record-high-could-change-2024-18561543.php">nearly 36% in December</a>, an alarming increase of three percentage points since the fall.&nbsp;

Many workers have not returned to San Francisco’s downtown offices since the start of the pandemic, and the city’s commercial real estate vacancy rate climbed to <a href="https://www.sfchronicle.com/realestate/article/s-f-office-vacancy-record-high-could-change-2024-18561543.php">nearly 36% in December</a>, an alarming increase of three percentage points since the fall.&nbsp;

Gupta told The Standard on Tuesday afternoon that he doesn’t believe San Francisco has entered a doom loop.

Gupta told The Standard on Tuesday afternoon that he doesn’t believe San Francisco has entered a doom loop.

“The loss of work from remote work provides the early triggers for a destabilizing event. I think the initial stress is there,” Gupta said. “The question is how policymakers ultimately respond to that and the next steps.”

“The loss of work from remote work provides the early triggers for a destabilizing event. I think the initial stress is there,” Gupta said. “The question is how policymakers ultimately respond to that and the next steps.”

While the warning signs are real, Gupta noted the “booming” <a href="https://sfstandard.com/2023/01/23/san-franciscos-next-gold-rush-is-already-here-and-youve-been-using-it-for-years/">AI industry in San Francisco</a> and the vibrant venture capital community, which includes Farrell’s firm, Thayer Ventures. (He promised Wednesday to put his assets in a blind trust if elected mayor).

San Francisco’s next gold rush is already here, and you’ve been using it for years

While the warning signs are real, Gupta noted the “booming” <a href="https://sfstandard.com/2023/01/23/san-franciscos-next-gold-rush-is-already-here-and-youve-been-using-it-for-years/">AI industry in San Francisco</a> and the vibrant venture capital community, which includes Farrell’s firm, Thayer Ventures. (He promised Wednesday to put his assets in a blind trust if elected mayor).

“San Francisco is going to remain a hub for innovation, I imagine,” Gupta said. “The questions pertain to whether the city is going to fill some of that office space and retain residents and attract new residents to be a vibrant destination.”

“San Francisco is going to remain a hub for innovation, I imagine,” Gupta said. “The questions pertain to whether the city is going to fill some of that office space and retain residents and attract new residents to be a vibrant destination.”

He added, “You could see a world where San Francisco doesn’t disappear but remains diminished.”

He added, “You could see a world where San Francisco doesn’t disappear but remains diminished.”

Mark Farrell, a former San Francisco mayor and supervisor, formally announce his candidacy at the San Francisco Baseball Academy at 3010 Geary Boulevard in San Francisco on Tuesday, Feb. 13, 2024. Mark Farrell will challenge London Breed and other candidates in the November 2024 mayoral election.

<figure class="wp-block-image size-large"><img src="https://content.sfstandard.com/wp-content/uploads/2024/02/20240205farrellmayor009.jpg?w=2500" alt="A man stands at a podium as a crowd stands in the background holding &quot;Mark Farrell for mayor&quot; signs. " class="wp-image-249201"/><figcaption class="wp-element-caption">Mark Farrell compared the state of San Francisco to cities like Detroit and Oakland at a press conference announcing his run for mayor.</figcaption></figure>

Farrell told supporters Wednesday that he has heard from people who avoid downtown due to the lack of Ubers, Lyfts and taxis to get to and from Market Street, requiring a “scary” walk to pickup points in the Tenderloin neighborhood.

Farrell told supporters Wednesday that he has heard from people who avoid downtown due to the lack of Ubers, Lyfts and taxis to get to and from Market Street, requiring a “scary” walk to pickup points in the Tenderloin neighborhood.

“Why don't we have [cars] on Market Street? Just because it’s the ideology of no cars?” asked Farrell. “No more in San Francisco.”

“Why don't we have [cars] on Market Street? Just because it’s the ideology of no cars?” asked Farrell. “No more in San Francisco.”

Robin Pam, the founder of Kid Safe SF, an organization focused on protecting open spaces and creating safer streets, called Farrell’s Market Street proposal a dangerous “political ploy” that would also lead to slowdowns in Muni bus operations.

Robin Pam, the founder of Kid Safe SF, an organization focused on protecting open spaces and creating safer streets, called Farrell’s Market Street proposal a dangerous “political ploy” that would also lead to slowdowns in Muni bus operations.

“Apparently, Mark Farrell believes that the safety of transit riders, walkers and bikers is worth trading for cheap political gain,” Pam said. “He claims to support our city’s transit-first policy, yet his plan would reintroduce congestion, exhaust, noise pollution and collisions to Market Street.”

“Apparently, Mark Farrell believes that the safety of transit riders, walkers and bikers is worth trading for cheap political gain,” Pam said. “He claims to support our city’s transit-first policy, yet his plan would reintroduce congestion, exhaust, noise pollution and collisions to Market Street.”

Downtown San Francisco’s future? More innovation and fun, fewer offices

Downtown San Francisco: Will soaring retail vacancies create room for fun?

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Doom loop tour: With host a no-show, organizers remain a mystery

Search Results for: doom loop

Downtown San Francisco’s future? More innovation and fun, fewer offices

Downtown San Francisco: Will soaring retail vacancies create room for fun?

Mayoral candidate calls for bringing cars back to Market Street

The San Francisco Standard’s most-read stories of 2023

Doom loop tour: With host a no-show, organizers remain a mystery