San Francisco led on COVID lockdowns, vaccine rules. Where is Breed’s reopening plan?

SF leaders need clear course of action to revitalize The City’s economic heart

By Examiner Editorial Board

Mayor London Breed said something odd the other day.

“I can’t be concerned with why people do or don’t want to be here,” Breed told The Examiner’s Sydney Johnson when asked about San Francisco’s downtown offices, which continue to sit largely empty 20 months after the first COVID-19 lockdown. “All I can do is the best I can do, get this city cleaned up so people feel safe and change people’s hearts and minds in the process.”

Breed uttered these words while collecting litter during a neighborhood cleanup in the Tenderloin — a photo op she apparently judged worthy of mayoral concern.

For her next community visit, Breed might want to tour the Financial District and talk to small business owners struggling to stay afloat in the fourth quarter. The mayor gained national attention for shutting down The City just hours ahead of a Bay Area-wide COVID lockdown in 2020. But she’s at a loss when it comes to getting San Francisco back to work.

“Business owners in The City remain frustrated with the slow pace of economic recovery, citing empty office buildings, struggling restaurants and a stagnant hotel and convention business,” wrote Johnson. “Some business owners fear another brutal winter as local COVID cases tick up. And they are concerned with City Hall’s economic recovery plans, or lack thereof.”

As the pandemic stretches on toward the two-year mark, downtown San Francisco — the economic heart of one of the most vaccinated cities in the nation — lags behind other big cities in regaining momentum.

“The Bay Area region is basically at the bottom of the list in terms of where we are in recovery,” said Jeff Bellisario, executive director of the Bay Area Council Economic Institute. “We are still down 7.5% of the jobs we had before pandemic. Other cities, like Denver and Seattle, are already back to full recovery.”

Kastle Systems, which tracks business occupancy, showed The City with a 26.7% office occupancy rate as of Nov. 10. That’s 13 points below a 10-city average of 39%, and well below cities like Austin (55.3%), New York (35.3%) and Los Angeles (35.5%).

The sluggish comeback frustrates downtown businesses, whose customer base evaporated during the lockdowns. Unless city leaders develop a deft strategy to navigate the COVID endemic, a winter surge could be the final blow for entrepreneurs like Hawk and Sophia Tea.

The couple quit their corporate jobs and used their savings to open a Cambodian chicken wing restaurant in 2018. Shlap Muan, their shop in the Crocker Galleria on Sutter Street, thrived. Customers flocked to the joint for its lively habanero-orange glazes and a proprietary spice rub called “Cambodian dirt.”

“Prior to the pandemic, we were really, really busy,” said Hawk Tea. “Literally overnight, 90% of our business died.”

Twenty months later, Hawk Tea said the Financial District remains a “ghost town.” Empty storefronts outnumber open stores at the three-story Crocker Galleria. On the building’s ground level, a sign for A Shine and Co. boasts that Vanity Fair named it “Best Shoeshine in the World!” in 2012, but a security guard said the location has closed for good.

A sparse lunch crowd has returned, but business is so light that Tea and his wife run the restaurant without employees.

“Things need to change soon,” said Hawk Tea, who was born in a refugee camp, when asked his advice for the mayor. “Being in such a downtown-heavy area, we relied on people coming to work, office workers. We’re not in the suburbs where people are working from home and can order from anywhere.”

The lack of a clear plan from city officials hasn’t helped, he said.

“You open it one day, you close it the next day … people are confused,” he said.

Across the street at Cable Car Clothiers, Jonathan Levin stood behind the counter at the haberdashery his grandfather established in 1946. The shop has survived multiple recessions and earthquakes, but Levin said it’s never faced a challenge like this.

“Obviously, we take health care and COVID very seriously, but it’s absolutely just brutal and devastating to the Financial District,” said Levin as he awaited scarce customers. “We really want to encourage people to come out, shop and enjoy the holiday season.”

At the Russ Building Barber Shop on Pine Street, Dan Frasco blasted San Francisco’s failure to reopen.

“There is no consistency,” said Frasco, who has cut hair at the shop since 1981. “We’re kept in the dark, for one thing. We get no information about possible reopenings or the groundwork for possible reopenings.”

When asked to respond to the mayor’s comment that she “can’t be concerned” about the empty downtown, Frasco didn’t mince words.

“She’s being brutally honest about her lack of leadership in her own city,” he said. “She’s just condemned herself.”

These small businesses may be beneath the mayor’s interest level, but a die-off of Financial District commerce will also hurt city finances. If The City’s economic engine stays idle, officials can expect a dearth of tax revenue and increased budget pain once federal rescue funds run out. Fewer workers and businesses in The City will mean reduced business tax money in city coffers.

“In fiscal year 2020-21, that money accounted for more than $800 million in city revenue, or about 13.3% of the city’s general fund,” wrote Chase DiFeliciantonio of the San Francisco Chronicle in October.

Adjusting to the new COVID reality is challenging. A proper response to the early stages of the pandemic required maximum vigilance to save lives. Now that vaccines have significantly reduced the threat, it’s time to rethink the approach.

“Fundamentally, we have to shift our thinking away from case counts to being concerned about what led to lockdowns, mass distancing, contact tracing, and testing to begin with, which was severe disease,” said Dr. Monica Gandhi of the University of California, San Francisco.

Gandhi said data on hospitalizations and deaths, rather than case counts, should guide The City’s public health response. She worried that an overly fearful approach could raise doubts about vaccine effectiveness.

Bay Area employers appear optimistic about the near future, with most expecting employees to return to the workplace in some capacity over the next few months, according to an October survey by the Bay Area Council. This could change, however, if local leaders fail to instill confidence by presenting a clear reopening strategy.

“If the devastation can get any worse, it will,” said Frasco, the barber. “Until it just crumbles and there’s nothing left anymore.”

“We’re gonna go home,” said Sophia Hawk when asked what will happen to her chicken shop if The City backslides into lockdown mode.

A mass shuttering of businesses, coupled with declining tax revenues, could set Breed up for a challenging reelection campaign in 2023. Hopefully, this political reality merits mayoral concern and will spur action to help save the Financial District’s remaining businesses, not to mention Breed’s career.

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