San Francisco 'doom loop' threatens to gut downtown economy as employees work from home

 The San Francisco Chronicle's editorial board put out a dire warning about San Francisco's economy, emphasizing that the city needs to evolve as fast as possible to avoid a ‘doom loop’ from employees transitioning to remote work.

"Experts say post-pandemic woes stemming from office workers staying home instead of commuting into the city could send San Francisco into a 'doom loop' that would gut its tax base, decimate fare-reliant regional transit systems like BART and trap it in an economic death spiral," the editorial warns.

The editorial board also drew a comparison between San Francisco after COVID-19 and New York City after 9/11, as commuters feared returning to New York skyscrapers after the terrorist attacks.

But with enough subsidies, the article argues, Manhattan bounced back thanks to new train stations, public parks, malls and residential buildings in the Financial District. But San Francisco has yet to make structural changes. 

"Despite our housing crisis, it was years into the COVID pandemic before our leaders meaningfully questioned the logic of reserving some of the most prized real estate on Earth for fickle suburbanites and their cars," the editorial said.

"And so we wasted generous federal COVID emergency funds trying to bludgeon, cajole and pray for office workers to return downtown instead of planning for change," the piece continued. "We’re now staring down the consequences for that lack of vision."

The editorial board suggested investing in office-to-housing conversions and demolishing office buildings for new projects, which would require financial help from the state government.

Last year, San Francisco topped a list of cities that homebuyers wanted to move away from. 24% of buyers in a Redfin report were looking to leave San Francisco.

Alexandria Real Estate Equities founder and CEO Joel Marcus had told Fox Business in January that redeveloping older office buildings into multifamily homes could solve the housing crisis.

"This sits as a monumental opportunity, I think, for this country to take this stock of older office buildings," Marcus said on "Mornings with Maria." "Almost 996 million square feet by current account, and move that into a stock of housing because it sits there, and it just needs to be redeveloped."

https://www.foxbusiness.com/economy/san-francisco-doom-loop-threatens-gut-downtown-economy-employees-work-home