Supes push SF officials for ‘larger vision’ for Union Square

With The City facing a huge deficit as it heads toward budget negotiations, a committee of the Board of Supervisors called on officials this week to develop more cohesive plans for investing civic funds to revitalize the historic Union Square shopping district in a time of radically changing retail dynamics.

The four supervisors present at the Land Use and Transportation Committee hearing Monday heard from various city officials — particularly from the Office of Economic and Workforce Development — about a litany of initiatives already taken or underway, ranging from a holiday pedestrian fair to the ongoing design of streetscape improvements for lower Powell Street, where a large number of stores are vacant.

Sarah Dennis Phillips, executive director of the Office of Economic and Workforce Development, insisted that the many actions taken by her office and other city agencies add up to bigger things.

“The plan, No. 1, is to create a really great environment,” Phillips said. “The City is in charge of the public realm. How do we make our streets great? How do we make sure the spaces are safe? And how do we make them places that people want to be?”

San Francisco has issued more than $1.5 million in grants since 2022 to bring life to Union Square through space activations and programming such as the tulip celebration in early March that drew 30,000 people in one day.

Yet in the first quarter of this year, record retail vacancies in Union Square helped push the citywide numbers to a new peak amid relatively low post-COVID-19 tourism and record office vacancies downtown, according to real-estate experts.

And that’s not including the potential loss of Macy’s giant store , which the company announced in late February it would eventually close along with about 150 others nationwide.

Supervisor Ahsha Safai, the hearing’s sponsor and a 2024 mayoral candidate, asked city officials to return later with a “larger vision” for Union Square.

Phillips listed challenges, including that a third of The City’s hotel rooms are in the Union Square area and tourism — which plummeted in the COVID-19 pandemic — has not yet fully recovered .

She also listed positive indicators, including that the luxury sector near the square remains relatively strong — although Monday’s hearing took place the same day that jeweler Shreve & Co., which traces its origins to 1852 in The City, said it was closing its Union Square store , leaving San Francisco and designating its Palo Alto store as its “flagship.”

Phillips said the new rooftop restaurant Chotto Matte at the former Macy’s Men’s Store and the Starlite Lounge cocktail bar atop the Beacon Grand Hotel “have made a big bang.” A Jollibee restaurant will also be opening soon, she said.

Jacob Bintlif, manager of economic recovery initiatives with Phillips’ agency, talked about efforts to keep the square safe with law enforcement and enhancing security in area garages, and of beautifying the area with tables, chairs and lighting.

Looking forward, Bintliff said the agency is working to fund stage improvements in Union Square and plugged the scheduled June 13 concert by blues artist Earl Thomas.

The supervisors, however, wanted more.

“It seems like our business plan for this area just is not working now,” said Supervisor Myrna Melgar, the committee’s chair, who suggested more temporary pop-up stores, food trucks and other low-cost strategies as ways to activate street life — just the sort of thing Phillips said is on order.

“And so I'm interested again in the plan,” Melgar said. “What's the plan? What's the timeline? How do we make that happen?”

Board of Supervisors President Aaron Peskin, who represents Union Square and has supported spending for its benefit, said he understood his colleagues’ “frustration” in light of longstanding retail trends and various city expenditures, including “a disproportionate investment in public safety and law enforcement” on the square.

It is a “collective imperative,” the mayoral candidate said, “to move away from the ‘throw the spaghetti on the wall and see what sticks’ to a plan that is rational.”

Supervisor Dean Preston similarly said he was “still unsure what the longer-term plan is” if entities such as Macy’s are not downtown. Preston also said “there's some real equity issues” concerning The City’s investments in Union Square, noting that after a shooting his constituents in the Tenderloin would like to have a police mobile command center like the one consistently parked outside the Apple store on Post Street.

“It'd be different if we had a longer-term vision and plan that we're building toward,” Preston said. “But what I'm worried about is, we're throwing these kinds of resources at the neighborhood without that kind of longer term plan.”

Safai asked Phillips probing questions about her agency’s use of money for different purposes than was originally promised last May by Peskin and Mayor London Breed to help fill empty storefronts on Powell Street — a move that Peskin criticized after he learned of it.

Phillips testified that the $1.8 million available would not have gone far for tenant improvements in large, vacant commercial spaces on lower Powell Street, and her agency diverted much of the money to other purposes.

Her office said previously $440,000 went to help restaurateur Tyler Florence open two food outlets in Union Square kiosks, and $549,000 went for the 10-day Winter Walk, a pedestrian-only holiday event on streets by Union Square.

Phillips’ agency also sought someone to operate “a multi-vendor market hall” featuring local retailers, artists, and food and beverage providers, with a preference for a location on Powell Street. But nobody submitted a bid, and Phillips said about $500,000 of the money remained.

The supervisors, meanwhile, recently voted to accept $2 million in state grant money to upgrade the restaurant kiosks that Florence took over last year. Design work also continues for planned streetscape improvements on Powell Street, for which $4 million was earmarked.

Regarding the redeployed funding, Safai said “we shouldn't be reallocating resources to other areas, even though it's in the same vicinity,” and that he saw opportunities to get retailers into some of the smaller spaces on Powell Street.

At the same time, however, Safai and Melgar both praised the Winter Walk, which featured streets filled with decorations and food trucks. Phillips said her agency teamed with the Union Square Alliance to “supercharge” the event, which Bintlif said attracted 76,000 people.

“There were so many people on the street, right?” Melgar said. “And so how do we make that a regular occurrence, and how do we maximize our public investment to allow the private sector to, you know, thrive by inventing new things, by being creative?”

Phillips said that her agency is focused on filling the calendar up with activations and programming in the public realm.

“So making sure there's things, whether it's a band or a yoga class or a pop-up market, there's something happening every day,” Phillips said.