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Chinatown businesses shutter in face of Central Subway construction

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In June, Mayor Ed Lee directed more than $500,000 for Chinatown merchants through the Office of Economic and Workforce Development. But a month later, Supervisor Aaron Peskin placed $255,000 of that funding on reserve. (Mira Laing/Special to S.F. Examiner)

Twenty-five years ago, Joe Lee came to San Francisco from Hong Kong and opened a Chinatown clothing shop called Hong Kong Outlet.

Hong Kong Outlet was once bustling, and Lee was able to provide for her family, including her son Matthew, a 17-year-old Galileo High School student. Now, her store is routinely empty.

Hong Kong Outlet is closing — and Lee places the blame on lost parking and blocked signage caused by Muni’s Central Subway construction, which faces a year-long delay.

“It hurts a lot,” she said in limited English, aided by translation from her son.

Lee is not alone. During an afternoon tour of Chinatown, the San Francisco Examiner talked to merchants and neighborhood representatives who claimed to see significant drops in business due to the loss of parking on Stockton Street.

The $1.6 billion Central Subway is now slated to open in December 2019. That’s nearly a year later than it was initially set to open. Thousands of riders will glide into Chinatown on the T-Third line when the subway — that Chinatown leaders asked for — is complete.

But in the meantime, business owners said they’re suffering.

Exact numbers are hard to come by, but local travel agent Ed Siu and Raymond Hong, owner of Rainbow Express Studio on Stockton Street, both said they’ve seen several businesses shutter due to the construction. One of those businesses, Kong Chi Company, a gift shop on Washington Street, also experienced flooding due to construction, according to neighbors.

Amidst the turmoil, civic leaders are butting heads over solutions to save Chinatown merchants before they sink.

In June, Mayor Ed Lee directed more than $500,000 for Chinatown merchants through the Office of Economic and Workforce Development. But in July, Supervisor Aaron Peskin placed $255,000 of that funding on reserve — essentially freezing it from aiding the community.

On July 25 at the Board of Supervisors, Peskin explained that some of that money was directed to the Portsmouth Square Plaza Garage to provide free parking for Chinatown customers, but he felt the money needed a “community process.”

“Upon further analysis,” Peskin told the board, “I intended to move that portion of funding forward with more robust and direct targeting to ensure that it actually benefits the merchants in the immediately impacted area.”

Peskin argued that The City could offer free parking at Portsmouth without the money, essentially having its cake and eating it, too. Instead, Peskin said, the funding should go directly into merchants’ pockets in a new Central Subway Impact Zone.

Chinatown merchants were divided on the dueling plans: Free parking at Portsmouth Square or money in their pockets.

My customers, “they can’t walk up here!” Hong said. Since many Stockton Street customers are seniors, he said, walking up hill from Portsmouth Plaza Garage is a hardship they’d likely avoid.

“At least they’d help me survive,” he said of the direct funding proposal. Hong has seen a sharp drop in business and said his customers told him expressly that they would not take photos in his studio because parking was too difficult to find.

When the Examiner visited on Tuesday, his studio was empty.

Hong and his fellow merchants talk about ways to ease their construction woes in a 70-person digital chat group. In their discussions, he said his fellow merchants preferred Peskin’s plan over the mayor’s.

Susanna Zhou, who sells jade in a small shared storefront on Washington and Stockton streets, said free Portsmouth Plaza parking for her customers would not help, as most of her problems stem from the trucks that block her store on a daily basis.

“The direct money to me [is preferred],” Zhou said, “the parking is not.”

Most of the merchants the Examiner spoke with favored Peskin’s plan, but they were not monolithic in their opinions.

Siu, who has run Classic Tours in Chinatown for 32 years, felt differently. “The parking is helpful,” he said. He disagreed with Peskin’s move to halt the funding.

“If you say these merchants receive the funding, what about Washington Street, or Grant Avenue?” he said. Much of Chinatown has been harmed by the construction’s impact on parking, he said, making the choice of who to help problematic.

Kitman Chan, president of the Chinese Chamber of Commerce, said he believes both routes should be taken — but first, Peskin should release the funding.

Chan said Peskin should fund Chinatown merchants through the Board of Supervisors, instead. A look at Peskin’s addback funding requests show he made no requests for Chinatown merchant funding during June’s budget process. His largest funding request was $200,000 for public toilet staffing in Lower Polk.

The $255,000 Peskin placed on reserve will likely go before a Board of Supervisors budget committee when they return from recess in September.

The San Francisco Municipal Transportation Agency, which is overseeing Central Subway construction, has taken some steps to mitigate parking impacts: Loading zones have been adjusted to aid merchants, and last week, the agency announced it would add 12 additional parking spaces to the neighborhood, when it initially said it would only offer four.

“We’re very conscious of the existing issues raised by the merchants,” SFMTA spokesperson Paul Rose said, adding that while some of the impacts are “unavoidable,” the agency is “working to help their parking concerns.”

That’s likely small comfort to Joe Lee, whose Hong Kong Outlet store will shutter soon.

“I will get a job maybe,” she said. “I don’t know.”

Her last customer walked out soon after, leaving the store empty, save for Lee.

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