SAN FRANCISCO (KGO) — San Francisco’s Union Square, a downtown area that generates about 40% of the city’s general fund tax base, is showing signs of recovery.

However, key challenges remain as city leaders and real estate officials push for revitalization.

“Downtown, like all of San Francisco, is on the rise,” Mayor Daniel Lurie said.

City officials and commercial real estate agents point to improvements in retail occupancy as evidence of progress. The retail vacancy rate in Union Square on Thursday stood at about 15%, down from a peak of 22% in 2025. In 2019, before the pandemic, the vacancy rate was 6.4%.

Commercial real estate agent Julie Taylor of Colliers International described the shift as significant.

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“The nightmare is over. The nightmare is totally over,” Taylor said.

She said activity is underway even in buildings that remain vacant.

“Every building that is vacant has something going on — at a minimum, people touring. But a lot of them have multiple offers trading,” Taylor said.

Taylor said she expects the area to fully rebound within about two years, including the Powell Street corridor, which last year experienced a retail vacancy rate of 71%. She said interest from corporations has increased this year as companies reassess the city.

“They want to tour space. They want to understand what’s changed in the market. They want to know about the Powell Street improvement project. They want to know everything that our DA and our mayor are doing for Union Square and how things have changed,” Taylor said.

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Interest from potential tenants has also coincided with lower lease prices, with some spaces seeing declines of up to 30%. Several major retailers are shifting locations within the area, including Zara, Uniqlo and Chanel. There are also unconfirmed reports that Nordstrom, which left the Westfield Mall, may take over the space previously occupied by Saks Fifth Avenue. As part of the effort to attract businesses, the mayor recently announced the Downtown Business Fund, which aims to provide grants and low-interest loans to businesses that lack the capital to lease space downtown.

“Helping a business open its doors downtown creates jobs, activates streets and restores confidence in the heart of the city,” Lurie said.

Another major component of the revitalization effort is the Powell Street improvement project, estimated to cost between $20 million and $40 million. The project is intended to help restore Union Square as a commercial and pedestrian hub at an estimated cost of $2 to $4 million.

“It is a significant amount of money,” said San Francisco Supervisor Danny Sauter. “Part of this is coming from a 2024 bond that the voters approved, we’re not raising taxes with this. It’s some of that bond money and some of the downtown partnership money from across business leadership realizing this is a really important corridor.”

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Despite optimism around retail, downtown office vacancy remains a concern. Office space vacancy stands at about 28%, compared with between 4% and 6% in 2019. Adding to the mixed outlook, one of England’s largest real estate companies, which owns property around Union Square and elsewhere in San Francisco, said last week that it is selling off part of its Bay Area portfolio.

“Those that want to depart our city, they’re missing out,” Lurie said.

The mayor acknowledged that progress remains fragile.

“Now, I will say this: our economy is coming back, but it’s fragile, and we gotta nurture it, and we have to build partnerships like you’re seeing today to keep it growing, because the rug could be pulled out from under us quiet easily,” he said.

SAN FRANCISCO (KGO) — A San Francisco man says months of reporting graffiti and vandalism in his Mission District neighborhood yielded little response from the city – until he received a notice blaming him for a small graffiti tag on a fire hydrant connected to his home.

Michael, who asked that his last name not be used, told ABC7 Eyewitness News that he has spent the past year alerting the city to vandalism near his home. He said he has called 311, contacted San Francisco police, emailed city leaders and even tweeted Mayor Daniel Lurie, but mostly received automated or generic replies.

“Obviously, we would have taken care of it had we noticed. But it’s like this tiny little thing,” Michael said, referring to the graffiti notice issued by the city.

The notice came from the San Francisco Department of Public Works, citing graffiti on a fire hydrant connected to his property. Michael said receiving it felt insulting after repeated attempts to get help addressing larger issues in the neighborhood.

“We feel like had those guys responded a little bit faster or like actually taking our emails seriously. Then this wouldn’t be there,” he said.

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Michael said what upset him most was what he saw as unequal accountability.

“I was particularly upset about is that they’re pointing out our problems without resolving theirs first. Like, don’t be hypocritical. Yeah,” he said.

In response to ABC7’s inquiry, the Department of Public Works provided the following statement in part:

“In this case, Public Works received a complaint about graffiti on the property and by law we were compelled to respond. We issued the property owner a corrective notice – not a citation – for a small graffiti tag, with 30 days to remove it.”

Michael acknowledged that he is aware of the city’s graffiti abatement program but said he believes the root issue goes beyond cleanup.

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“Realistically, like they have to deal with the drug crisis. That’s the core issue. Like it’s there’s nothing that’s more important in my opinion,” he said.

Walking through nearby blocks, Michael pointed out remnants of encampments and alleged drug dealing sites. He said the issue is personal, adding that his own family has struggled with substance abuse.

“If you deal with the people who are actively dealing and selling drugs on our street, then everything will go away,” he said.

As he noted a boarded-up property across the street that he said has attracted squatters, a neighbor agreed the situation has become unmanageable.

Michael said he supports Mayor Lurie and the administration’s approach overall but worries some neighborhoods are being overlooked.

“We are all paying property taxes. We are all contributing to the city. We all deserve the same level of respect and like I think cleanliness and just like the same level of service from the city and it just seems like they’re just, I don’t know, like relegating the problem into a one area,” he said.

Full statement from Department of Public Works:

“We hear this resident’s frustration, and we want to be clear: Our first path is to work with property owners, not against them.
In this case, Public Works received a complaint about graffiti on the property and by law we were compelled to respond.
We issued the property owner a corrective notice – not a citation – for a small graffiti tag, with 30 days to remove it. That’s intentional. We build in that window specifically to give property owners time and flexibility to address the violation. We also provide them contact information should they have any questions.
Property owners who are repeatedly targeted with graffiti vandalism can cite that as a hardship and we will take it into account. In this case, Public Works has not received an email or call from this property owner.
We also want to note that this complaint was submitted through Solve SF, a new AI-powered platform that allows the public to report issues of concern. Launched in January, the third-party platform provides people with another option in addition to the City’s 311 customer service operation to flag concerns. We encourage residents to report graffiti tags to keep our city clean and free of blight. It is important to remove tags quickly to deter more tags.
By City code, graffiti removal on private property is the responsibility of the property owner but there is an exception. San Francisco Public Works operates a Graffiti Abatement Opt-In Pilot Program that allows eligible property owners in commercial corridors to have graffiti removed from their property at no cost to them. Unfortunately, this particular property is not eligible for the opt- in program because it does not fall into the eligibility map.
For property owners experiencing repeated tagging, we recommend a few practical steps in addition to opting into our program: installing motion-activated lighting and security cameras, which can deter vandalism and support enforcement efforts.
Property owners on commercial corridors can learn more and submit an interest form on our website https://sfpublicworks.org/services/graffiti-opt-in
We want to resolve this quickly and we’re committed to working with this resident to do so.”

“He’s like a Volkswagen! He’s so huge!” said Oluwaseyi Akinbobola, a visitor from Los Angeles who had an extra half hour so she ran down to the pier for a hopeful peek of the elusive sea lion. “I have heard everywhere about this big giant sea lion, and I like to look at things, so just thought I’d check it out.”

Chonkers likely came from up north off the coast of Washington or Oregon and is estimated to weigh between 1,500 and 2,000 pounds (680 and 907 kilograms), said Laura Gill, public programs manager at The Marine Mammal Center in nearby Sausalito. Chonkers has been one of the few Steller sea lions to venture to the pier, which is protected from predators and crashing waves while providing a fish-filled buffet.

“There’s plenty of food in San Francisco Bay for them, so the fish, the rockfish, the anchovies, the herring, there’s a lot of easy prey for them,” she said.

@apnews A surprise guest at San Francisco’s Fisherman’s Wharf is quite literally making waves. Meet Chonkers, the name given to a giant Steller sea lion spotted this week lounging among his considerably smaller California sea lion neighbors. Chonkers belongs to the Steller species, the largest of all sea lions, known for their commanding presence and dock-dominating energy. Adult males can weigh over a ton. #sealion #cuteanimals #sanfrancisco #seal #california #fishermanswharf #animals #ocean ♬ original sound – The Associated Press