San Francisco's Criminals and Crack Heads Lose Another Big Retailer to Loot

[Eupher]

Nobody should be surprised by this, as there has been a steady exodus of businesses in and around San Fransicko.

You'd think the politicians and especially the people who live there would start to put 2 and 2 together and figure out that first, electing leftists to positions of leadership leads to this kind of anarchy, and second, you reap what you sow. Lots of Twatter in this one.

Soon there will be three fewer department stores for looters to pick clean in San Francisco.

Nordstrom, Nordstrom Rack, and Saks Off Fifth are all bailing out of what used to be a safer and more vibrant city. Nordstrom cites “rampant criminal activity” and blight as the chief reasons it’s pulling up stakes.

As we’ve reported, Whole Foods closed a key store recently in what used to be a lovely area before drug-addled “homeless” people and “organized retail theft” gangsters began stealing the merchandise. The city “leaders” chose not to enforce laws against tent-dwelling, fentanyl zombies, and crackheads. As a result, the people who are not tent-dwelling fentanyl zombies and crackheads decided to follow the employers and leave. This is what we call a market tell.

When Walgreens closed five stores, Mayor London Breed claimed the retailer did it only to cut costs. It was true. Walgreens got tired of – together now – tent-dwelling fentanyl zombies, crackheads, and organized retail theft gangs stealing its stuff. The pharmacy and all-purpose store had to spend fifty times more on security for its San Francisco stores than its others. Security staff could only wave at thieves as they walked out with $950 worth of stuff.

California and San Francisco have become sanctuaries for addicts and criminals. They can rip off $950 worth of loot before it becomes a felony. Now, after these “leaders” agitated to go easy on criminals, there are more criminals. That which is rewarded is repeated.

Abercrombie & Fitch left for the same reason. Ditto for Anthropologie. H&M and Uniqlo had to close most of their stores because San Francisco’s honored-citizen crackheads kept ripping them off.

Nordstrom noticed. On May 2, the retailer announced it was closing its anchor position at the posh Westfield San Francisco Center mall at the end of the Powell Mason cable car line. They’re pulling out in August.

The high-end department store cited crime and safety as reasons why it’s closing its anchor store near the end of a cable car line that is a beloved tourist attraction. But Nordstrom also pointed to the problem of less foot traffic in that part of the city.

Oh, there’s plenty of foot traffic, but they’re homeless crackheads and criminals, not shoppers.

Look, we know the mall business is getting tired, but this wasn’t a typical mall in the ‘burbs. It’s a curated collection of some of the finest retailers in the land in a downtown setting, easily reached by tourists and townies with a short walk or cable car ride.

But Nordstrom is bidding San Francisco adjö and it’s taking its Nordstrom Rack store with it. And Saks Off Fifth is no dummy. It’s leaving its location near the Nordstrom Rack.

Fewer shoppers are walking around on San Francisco streets these days because there are fewer employers occupying office buildings in San Francisco to employ them. Woke high-tech companies are leaving in droves or giving the city an Irish goodbye by maintaining a presence in California but growing in other states. Taxes, tyranny, and regulation are too much for even woke tech company moguls.

San Francisco is killing itself. Too bad the people running it don’t know CPR.

https://pjmedia.com/news-and-politics/victoria-taft/2023/05/08/san-franciscos-criminals-and-crack-heads-lose-another-big-retailer-to-loot-n1693371

[SVPete]

The next domino to fall? https://hotair.com/john-s-2/2023/05/09/san-francisco-target-store-experiences-10-thefts-per-day-n549596

At least some SF Starchuck's locations have built a wall in their enclosure separating customers and an order taker from the barista and people preparing orders. Hopefully assistance is readily available to help the order taker.

[Eupher]

The next domino to fall? https://hotair.com/john-s-2/2023/05/09/san-francisco-target-store-experiences-10-thefts-per-day-n549596

At least some SF Starchuck's locations have built a wall in their enclosure separating customers and an order taker from the barista and people preparing orders. Hopefully assistance is readily available to help the order taker.

I haven't been in a Charbucks in probably 10 years, but as I recall, they don't keep stuff out on a shelf to be stolen. If you want a scone, ya gotta ask for it. And prolly pay for it first, by now. 

Tar-jay, CVS, and other department-type stores is a whole 'nother critter.

[Ptarmigan]

T-Mobile Becomes Latest Retailer to Close Flagship Store in San Francisco
https://redstate.com/benkew/2023/05/09/t-mobile-becomes-latest-retailer-to-close-flagship-store-in-san-francisco-n743026

The telecommunications giant T-Mobile has closed its flagship store located in the San Francisco’s downtown area amid declining foot traffic and increased criminal activity.

The company reportedly closed the store, which spanned two stories and 17,000 square feet and was located in the upscale department store and shopping hub of Union Square, around a month ago.

In a statement provided to SFGATE via email, a company spokesperson did not give specific details about the decision, instead citing a change in “retailer strategy.”

“We recently reshaped our retail strategy,” said the spokesperson. “Employees have been offered roles within the company.”

On a related note. T-Mobile has closed its flagship store located in Downtown San Francisco.

[Eupher]

Let's see:

Declining foot traffic in downtown SF, increased criminal activity, human feces on the sidewalks, drug paraphernalia including syringes scattered throughout.

At which point does SF become an official dystopia? Or are they already there?

I don't think there's any doubt that Portland has achieved their dystopia, and Seattle as well though the rioting and looting has slowed down there somewhat. Maybe even the murders too.

[SVPete]

I haven't done a running event in SF since April 2013, and probably have not been to SF since May 2014. I avoid the place.

[Old n Grumpy]

It looks like a homeless problem solving itself. With all the empty stores and offices, the homeless will have plenty of places to live.

Once all the normal people move out, the homeless drug attic’s and criminals, will not be a problem anymore

[Ptarmigan]

Park Hotels & Resorts Inc. Announces Cessation of Payment on $725 Million Non-Recourse CMBS Loan Secured By Two of Its San Francisco Hotels
https://www.pkhotelsandresorts.com/investors/news-and-events/press-releases/2023/06-05-2023-113043391

TYSONS, Va., June 05, 2023 (GLOBE NEWSWIRE) -- Park Hotels & Resorts Inc. (“Park” or the “Company”) (NYSE:PK) today announced that, starting in June, it ceased making payments toward the $725 million non-recourse CMBS loan which is scheduled to mature in November 2023, and is secured by two of its San Francisco hotels—the 1,921-room Hilton San Francisco Union Square and the 1,024-room Parc 55 San Francisco. The Company intends to work in good faith with the loan’s servicers to determine the most effective path forward, which is expected to result in ultimate removal of these hotels from its portfolio. 

“This past week we made the very difficult, but necessary decision to stop debt service payments on our San Francisco CMBS loan,” commented Thomas J. Baltimore, Jr., Chairman and Chief Executive Officer of Park. “After much thought and consideration, we believe it is in the best interest for Park’s stockholders to materially reduce our current exposure to the San Francisco market. Now more than ever, we believe San Francisco’s path to recovery remains clouded and elongated by major challenges – both old and new: record high office vacancy; concerns over street conditions; lower return to office than peer cities; and a weaker than expected citywide convention calendar through 2027 that will negatively impact business and leisure demand and will likely significantly reduce compression in the city for the foreseeable future. Unfortunately, the continued burden on our operating results and balance sheet is too significant to warrant continuing to subsidize and own these assets.

Ultimately removing the loan and the hotels will substantially improve our balance sheet and operating metrics, as net leverage is reduced by nearly a full turn, while 2022 Comparable RevPAR and Comparable Hotel Adjusted EBITDA Margin as compared to 2019 would improve approximately 800 basis points and 230 basis points, respectively. In addition, reducing the negative overhang from San Francisco will allow Park to continue to focus on our key priorities to reshape our portfolio by selling non-core assets, and recycling capital to reduce leverage, invest in strategic ROI projects, and opportunistically repurchase stock and/or acquire assets.”

Park Hotels & Resorts is pulling out of San Francisco.

[Ptarmigan]

San Francisco Homeowners Lose $260 Billion In Value
https://www.hoover.org/research/san-francisco-homeowners-lose-260-billion-value

US residential home values have declined modestly since their 2022 peak, reflecting higher mortgage interest rates. But residential values have plunged in San Francisco, falling by about 16.7%, compared to a decline of just 3.3% in the rest of the country, a difference of about 13.4 percentage points. San Francisco’s housing stock was valued at nearly $2 trillion by real estate valuation firm Zillow before the price plunge. This additional 13.4 percentage-point drop means that San Franciscans have lost an extra $260 billion more in residential real estate value than it would have had it kept pace with the rest of the country.

San Francisco’s housing price decline reflects the fact that the city has lost more than 65,000 residents, roughly 7.5% of its population. San Francisco’s population loss has been the largest among all major cities in recent years.

Departing San Franciscans have on average represented households of very high income. Between 2019 and 2021, San Francisco lost nearly $15 billion of household income, even after accounting for those who moved into the city. Taxpayers who filed 2019 tax returns from San Francisco and 2021 returns from a new location reported an average annual adjusted gross income (AGI) to the IRS of nearly $196,000 per household.

Home values have dropped as people left San Francisco.

[SVPete]

Maybe Ralph could translate the CPA-speak, but the hotel's move will be part of the larger spiral. Tourists, shoppers and conventions are staying away, due to obvious reasons, and with this reduction of high-end hotel space, even more tourists and conventions will stay away. In turn SF's sales tax revenue is declining, as is and will its revenue from the Moscone Convention Center.

The biggest obstacles to SF stopping their downward spiral are the ideology and pride of its Board of Stuporvisors and failure to muzzle the city's activists.

[Ralph Wiggum]

Maybe Ralph could translate the CPA-speak, but the hotel's move will be part of the larger spiral. Tourists, shoppers and conventions are staying away, due to obvious reasons, and with this reduction of high-end hotel space, even more tourists and conventions will stay away. In turn SF's sales tax revenue is declining, as is and will its revenue from the Moscone Convention Center.

The biggest obstacles to SF stopping their downward spiral are the ideology and pride of its Board of Stuporvisors and failure to muzzle the city's activists.

Heard my ears burning...

The general rule is without a solid business tax base, nearby ancillary businesses and homes will suffer horrific declines in their business/property values. Part of this was accelerated by the Wuhan shutdowns which forced many employees to get way too comfy working remotely. The millions of square feet of beautiful office space (and not just in San Fran) are sitting unused because "workers" simply refuse to come back to the office. Not to mention the horrid leftist policies in California which are not exactly conducive to a thriving city and metropolitan area.

Commercial real estate used to be one of the safest bets for long-term investing, which is no longer the case at all.

[Old n Grumpy]

When real estate bottoms out large corporations will come in and buy up all the best properties at fire sale prices and make a fortune long term.

[Ralph Wiggum]

When real estate bottoms out large corporations will come in and buy up all the best properties at fire sale prices and make a fortune long term.

At this point, I'm not totally certain office and retail properties are even worth the long-term investment. Unless there is a major culture change amongst the younger folks.

[SVPete]

At this point, I'm not totally certain office and retail properties are even worth the long-term investment. Unless there is a major culture change amongst the younger folks.

Retail has been evolving for centuries. a century ago A & P was using its corporate buying power and network of affiliated stores to price Mom-and-Pop single-store buyers out of business (or into a narrow niche). Then along came supermarkets ... and warehouse stores ... and the Internet. The Internet certainly changed the marketplace for brick-and-mortar store, but the mass shoplifting resulting from DAs refusing to prosecute thieves will kill many outlets, and how it will settle out is very uncertain.

As for residential housing, SF has been HELL for even the best landlords, for decades. Even in the late 70s I thought being a landlord in SF or Berserkeley was hyper-unwise. It's not gotten better. I doubt many - if any - bogey-corporations would be stupid enough to buy up residential housing in SF so as to own and manage rental properties.

[Old n Grumpy]

So now the thieves will have to commute to the burbs

[DefiantSix]

So now the thieves will have to commute to the burbs

So long as they don't follow I-80 east of the Nevada Border...

 

[SVPete]

Exclusive: Westfield giving up S.F. mall in wake of Nordstrom closure, plunging sales and foot traffic

Domino effect ... Westfield doesn't want to try to operate this mall with 55% occupancy, net of the departing "anchor" store.

[SVPete]

BLUE CITY BLUES: Hotel Owners Start to Write Off San Francisco as Business Nosedives.

https://instapundit.com/589307/

Hotel owners in New York and Los Angeles are filling nearly as many rooms this year as they did in 2019, according to hotel-data firm STR. Their revenue per available room exceeds what it was before the pandemic.

But in San Francisco, hotels are still struggling badly in both occupancy and room rates compared with before the pandemic. Revenue per available room was nearly 23% lower in April compared with the same month in 2019.
...
Now, a growing number of San Francisco hoteliers are signaling they may be ready to give up. In recent months, the owner of the city’s Huntington Hotel sold the property after facing foreclosure and the Yotel San Francisco hotel sold in a foreclosure auction. Club Quarters San Francisco, which has been in default on its loan since 2020, may also be headed to foreclosure, according to data company Trepp.

The article quoted in this blogpost is in TWSJ, behind its paywall (or give-me-your-email wall). Given that it is vertical, like SF, and also has a DA that turns criminal predators loose, I wonder if NYC will soon also start nosediving.

[Eupher]

^^^ I dunno about NYC. Despite Eric Adams' stupidity and his blatant practice of nepotism, suggesting cronyism at the least or outright corruption at the most, neither he nor Bill deBlasio have been around long enough to put the skids to still, the largest city in the USA.

BUT, I am proud to say that my only foray into San Fransicko was in 1998 when I flew in from Chicago and immediately flew out to Reno. SF wasn't such a hotbed of insanity then like it is now, so it's not like I dodged a bullet. You couldn't pay me any amount of money to even broach the city limits now.   

[Drafe Hoblin]

Yep.  San Foreclosure. 

That baby ain't coming back in any meaningful time-frame. 

The Millennium Tower is leaning at a rate of 3-inches per year.  Symbolic.

[SVPete]

Many years ago I rooted about the Internet, trying to find a map showing where the pre-Spanish-colony shoreline had been to compare to modern maps. As best I could tell, the Millennium Tower is right at the border between shore and landfill, not the most stable footing. As the the contour of the underlying bed rock, ? Complicating attempts to solve the problem or decision to demolish the Tower is that it's condos, with hundreds of owners ("trapped", since their condos are unsalable).

[Old n Grumpy]

You would think that the government seeing its tax base leaving and property values plummeting and the quality of life in the toilet they would rethink their policy.

I guess they are to stubborn or to stupid 

[SVPete]

You would think that the government seeing its tax base leaving and property values plummeting and the quality of life in the toilet they would rethink their policy.

I guess they are to stubborn or to stupid 

Being Prog means inability to admit, "I was wrong."

[SVPete]

Emails show what was behind closure of San Francisco mall (plus another major closure)

https://hotair.com/john-s-2/2023/06/15/emails-show-what-was-behind-closure-of-san-francisco-mall-plus-another-major-closure-n558337

As Beege pointed out earlier this week, the owners of Westfield Mall in downtown San Francisco have announced that they’ll be giving the property over to the lender. The mall had already lost Nordstoms last month and this week the Cinemark movie theater also announce it was closing. In fact, today is the theater’s last day.
...
What kind of business conditions? Oh, those kind of conditions.

Seeing feces on the ground is not uncommon in the city by the bay. But human waste has been showing up somewhere else: the elevators in Downtown San Francisco’s Westfield Centre.

“It’s like twice a week now. It used to be once a month,” said Abimael Garcia, who manages janitors at Westfield. “So lately, it’s increased.”…

Kim said she saw feces in one of the elevators that leads from the theater to Mission Street about two weeks ago, and that someone appeared to have stepped in it.

One of the "dirty little secrets" (pun bitterly intended) about BART, going back a couple of decades is that escalators need to be shut down and "repaired" periodically, because they get gummed up with bum-crap and bum-piss. Using handrailings as one climbs the steps from the BART platforms to SF streets is also, ummm, inadvisable. So bum-crap in a mall's elevators is just a natural expansion of bum-territory.

[Old n Grumpy]

It never ceases to amaze me that the people allow this to happen and not take action against the government that allows it.