‘Death of Downtown' study: San Francisco ranks last

SAN FRANCISCO ( KRON ) — San Francisco ranked dead-last in a nationwide study examining why some American cities are bouncing back, and others are dying.

“With the initial shock of the pandemic, downtowns emptied out. Even as life has gradually returned to malls and neighborhood commercial corridors, the urban core is no longer a bustling center of activity. This trend has led many to wonder: is this finally the death of downtown?” states the study written by the Institute of Governmental Studies public policy research center.

Walking around San Francisco’s downtown looks, and feels, starkly different compared to pre-COVID times. Why is it taking so long for people to return back to downtown SF? IGS researchers said the city’s tech workers, tech-heavy economy, and difficult long commutes are partially to blame.

“In general, places with a higher share of employment in knowledge-based industries and occupations, and/ or more highly paid workers, are more likely to shift towards remote work. Surveys suggest this shift will be permanent for up to half of the workforce in cities that are large and congested (e.g., New York), or powered by the tech sector (e.g., San Francisco),” researchers wrote.

Researchers measure downtown vitality using three key indicators:

• Office vacancy rates
• Public transportation ridership
• Retail spending

Mobile phone data containing user locations provided researchers with a way to directly measure downtown activity patterns.

The analysis incorporated data for 47 months from January 2019 to November 2022 for 62 cities of at least 350,000 people across the US and Canada. From this data, a Recovery Quotient (RQ) was calculated for both downtowns and entire cities.

The study found a wide variation in the extent of recovery between cities, with activity ranging from a low of 31% of pre-pandemic levels in San Francisco, to a high of 135% in Salt Lake City.

Downtowns that will continue struggling to recover have disproportionate shares of business closures, lessening demand for downtown real estate due to professional tech workers staying remote, the study concluded.

Researchers wrote, “A distinct set of downtowns – typically older, denser downtowns reliant on professional or tech workers and located within large metros – continue to struggle to return to pre-pandemic levels.”

To survive in the new era of hybrid and remote work, downtowns will need to diversify their economic activity and land uses, researchers said. One bright spot noted in the study were resurgences in leisure and hospitality.

Researchers wrote, “Downtowns also need to be proactive about recreating downtowns for people. This could mean creating outdoor spaces with cultural events; rethinking streets for transit, bikes and pedestrians; moving parking to the outskirts of downtown; and attracting diverse segments of the population to visit.”

Just last week, Mayor London Breed announced her plan to reinvigorate downtown and reposition San Francisco as the Bay Area's economic hub. The Roadmap to Downtown San Francisco's Future focused on key priorities including offering a clean and safe environment, fostering a resilient workforce, and attracting new industries.

The Mayor’s Office wrote, “San Francisco's thriving office economy, prime geographic location, rich history as well as world-renowned culinary, cultural, and entertainment offerings, attracted over one million daily visits to downtown prior to the COVID-19 pandemic.”

In order to position San Francisco for the future, the Mayor’s Office vowed to move forward with policies that respond to new economic trends and challenges, while continuing to invest in the strengths and assets that are the “core pillars of San Francisco's competitiveness.”

Mayor Breed said, “While things have shifted profoundly during this pandemic, we also know that San Francisco's innovative and creative spirit remains as strong as ever.”

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