San Francisco Begins Latest Program to Attempt Bringing Back Retail

A new program by the city of San Francisco to revitalize it’s empty downtown to give free rent and grant money for pop-up businesses was started on Monday, with applications now available.

Since 2020, around the start of the COVID-19 pandemic, San Francisco has seen a major loss of storefronts and retail locations in the city. High crime rates, open drug use, and record numbers of homeless vagrants in areas of the city are all major components for this loss. Additionally, high rental prices, a huge decline in foot traffic caused by the exodus of businesses from downtown, and many businesses relocating outside the city to be closer to where owners and employees live have contributed. As a result, both chain stores and independent businesses have left  San Francisco, leaving a great number of vacancies.

With almost a third of all office and retail space now empty in downtown, and similar rates elsewhere in the city, San Francisco has attempted numerous programs in the last few years, with none showing success. In her state of the city in February, Mayor London Breed highlighted many areas to focus on to bring businesses back downtown, including improving safety and cleanliness, attracting and retaining a diverse range of industries and employers, finding new uses and flexibility in empty buildings, making it easier to start a business, growing the workforce, making downtown more of a cultural and entertainment hub, enhancing public spaces, improving transportation, and focusing on the positives of the city to attract new residents and businesses.

Under that plan, the Mayor specifically has calls to lower permit costs, pause tax increases for businesses remaining in the city, and offering new businesses three-year tax breaks. For developing downtown into more of an entertainment hub, Mayor Breed even proposed passing legislation to allow for outdoor alcohol consumption.

However, the situation has failed to improve. While the summer tourist season can bring in more potential customers to these stores, many are still staying away due to the whole host of issues mentioned earlier. Needing more avenues to entice businesses, San Francisco decided to focus on pop-up shops, or short term retail and art locations usually lasting less than a few months, by instituting a new program on Monday.

Known as Vacant to Vibrant, accepted pop-up shops will get three months of free rent, as well as an additional $3,000 to $8,000 grant to help pay for expenses moving in. For interested businesses, they will first need to fill out an application. Once accepted, a committee will evaluate each one, with the most highly scored being itched to interested property owners. Owners themselves will need to apply to be considered to host such a store, with areas with less than 5,000 square feet of space being preferred first. Must haves for interested landlords include available wifi, at least one bathroom, and to be on ground level.

The city itself will foot the bill, with $710,000 being set aside by the Office of Economic and Workforce Development and the nonprofit group SF New Deal.

“Vacant to Vibrant is a city-funded program that aims to revive San Francisco’s Economic Core (aka “Downtown”) by helping small businesses, entrepreneurs, artists, and cultural organizations activate vacant storefronts to revitalize the area and promote economic recovery,” the Vacant to Vibrant’s website says. “As part of the greater vision of Mayor Breed’s Roadmap to Downtown San Francisco, Vacant to Vibrant will provide a window into what the future of Downtown can look like with public participation — innovative, creative, vibrant, and multifaceted.”

However, while the program is being praised by some in the city, many others have serious doubts if the pop-up locations will have any amount of success.

“This is not going to be successful,” Michelle Duggan, a building occupancy researcher, told the Globe on Monday. “Cities in the Bay Area have literally been trying for years to have pop-ups kind of kick start retail places, but to no avail. City entices them to come in, they’re there for 3-4 months, then they leave. Not a lot of business cycles through, and few people benefit. Some of the more high profile ones, like San FranDisco, had a good few first days, but then quickly fell by the wayside, with the problems of the city creeping in.”

“It’s good that the city is trying still, but they are ignoring the incentives that have been proven to work, like tax breaks and city programs that reduce crime and other related issues to get them to stay. We know how to get businesses back, but San Francisco seems to try everything but the obvious solutions for long-term retail and other leases.”

Applications for the Vacant to Vibrant program are open until June 1st.