Tech companies in the Bay area have fired 126,000 highly paid workers since January 1. The hotels have lost massive value, just two of them lost over one billion in value. Dennys had to close due to crime. The schools have lost so many students that they are being forced to close schools. Market Street is dead due to lack of cars and workers coming to the area.
“February 7, 2024 [In a post about the collapse of China’s over-leveraged real estate sector]:
Worse is the coming collapse of the commercial real estate sector. Across America’s big leftist cities, office buildings stand empty. The left drained them during COVID, sending workers home, and workers don’t want to return. Moreover, for many companies, the overhead of having to send to a home-based employee a computer and monitor, as well as providing health care benefits, is infinitely preferable to carrying a huge office lease with all the attendant costs (e.g., insurance, maintenance, etc.).”
San Francisco’s economy goes deeper into a death spiral
By Andrea Widburg, American Thinker, 8/12/24 https://www.americanthinker.com/blog/2024/08/san_francisco_s_economy_goes_deeper_into_a_death_spiral.html
Anyone who takes financial advice from me is a nincompoop. I grew up in a home where my parents worked like crazy and, in a good month, had a minute amount left over for their “life savings.” I’m not much more sophisticated. However, I’m also not an idiot, and it was always patently clear that San Francisco’s COVID, crime, and homeless policies were creating a massive commercial real estate disaster. That disaster is now hitting the tourist industry with explosive force.
I’ll quote myself here only because it’s unusual for me to nail financial predictions, showing how idiot-proof my predictions were:
January 16, 2020 [In a post about San Francisco’s homeless policies driving away tourist business]:
While it was once just the South of Market region that was icky because of a few sleeping (or rambunctious) drunks, some stinky pee, and some shabby buildings, tourists are discovering that San Francisco’s entire downtown is inundated with hundreds of scary homeless people, mounds of fecal matter, thousands of discarded needles, and clusters of tents and shopping carts.
February 7, 2024 [In a post about the collapse of China’s over-leveraged real estate sector]:
Worse is the coming collapse of the commercial real estate sector. Across America’s big leftist cities, office buildings stand empty. The left drained them during COVID, sending workers home, and workers don’t want to return. Moreover, for many companies, the overhead of having to send to a home-based employee a computer and monitor, as well as providing health care benefits, is infinitely preferable to carrying a huge office lease with all the attendant costs (e.g., insurance, maintenance, etc.).
In downtown San Francisco, the vacancy rate was 5% before Democrats used COVID to defeat Trump by breaking the economy. As of October 2023, the last quarter for which there’s data, it had a 25% vacancy rate, with Los Angeles coming in at 24%. Other big cities aren’t quite as bad, but there will be a reckoning.
February 28, 2024 [In a post about Macy’s closing its flagship store in Union Square]:
Another problem, writes the [CNN] article [describing Macy’s store closure], is the drop in tourism dollars. CNN blames residual pandemic fear, but only lefties still care about it.
I sense that tourists don’t want to go to a city drowning in feces and one in which they may be mugged or have all their luggage stolen from their car within minutes of touching down in the city. Why bother? There are other beautiful places in America (I recommend Charleston, SC) that are both clean and relatively safe.
Just as Biden shows what leftism does to a nation, San Francisco reveals what it does to a local community: It’s lockdowns, drugs, crime, filth, hostility to business interests, crazy sex and nakedness in public, and everything that wears down a population, sends away money, and frightens tourists.
July 7, 2024 [In a post about San Francisco’s business policies]:
The result in San Francisco has been disastrous, especially because the city took advantage of COVID to strengthen these economic and cultural Marxist policies. Crime has exploded, public debauchery is the norm, and the city’s economy is in freefall (including in its once-thriving tech sector), with a coming commercial real property collapse that will make 1929 look like a party year.
My past writing reveals that any damn fool could have seen what was coming from a city that shut down businesses for two years and continues to encourage homelessness, while refusing to police crime.
Leftism is all about theories, but those theories never align with reality. Inevitably, reality prevails. Now, that inevitable reality has struck San Francisco all-important tourism industry:
San Francisco’s glitzy hotels have been plunged into massive debt following a dramatic drop off in tourism to the Golden Gate City.
The Californian city’s two biggest hotels, the Hilton Parc 55 and Hilton San Francisco Union Square, have lost a combined $1billion in value, according to the Kroll Bond Rating Agency.
Their worth is now $553.8 million.
Meanwhile, the delinquency rate among commercial mortgage-backed security loans for the sector jumped to 41.6 percent in June from 5.7 percent the same time last year, according to data from real estate analytics firm Trepp.
[snip]
Weekend hotel occupancy in June, a rough gauge for leisure travel, is down 22 percent since 2019 in the San Francisco-San Mateo region, compared to four percent nationwide, according to data firm CoStar Group.
The [Wall Street] Journal suggested that tourists were being put off by ‘quality-of-life issues’. Cost of living in San Francisco is notoriously high – with the Bay Area being the second-richest area in the US, behind New York City.
Open air drug markets, a growing homeless population, and increased crime has left many San Francisco neighborhoods in turmoil.
Enterprising conservatives should plaster signs in front of every empty storefront, hotel, and office building saying, “Democrat policies did this.”
But of course, there are practically no conservatives left in places like San Francisco. That’s why so many leftist cities are collapsing—and those that haven’t collapsed will discover that, as Hemingway wrote about bankruptcy, it happens in “two ways…gradually and then suddenly.”
These formerly thriving cities have made themselves so hostile to tourists, businesses, and ordinary people that they’re in a death spiral. And as long as the voters continue to vote for Democrats (84% voted for Nancy Pelosi and 86% voted for Gavin Newsom in 2022), nothing will change.
Even the 1906 San Francisco earthquake didn’t do as much damage to once-lovely San Francisco as leftism has done. And while the city quickly rebuilt after the quake, it’s questionable whether San Francisco can ever recover from the freefall.
The saving grace for San Francisco is China Town. They have their own “police/security” system. There is almost zero crime committed in China Town.