San Francisco trails different main metro areas in financial restoration
San Francisco is lagging behind other major metropolitan areas in the economic recovery from the ongoing COVID-19 pandemic, according to the latest report from the Office of the City Controller.
Office workers are returning to their desks in other cities, but it remains unclear how many actually live, work and spend in San Francisco.
While Austin, Texas has an office visit rate of up to 60%, Greater San Francisco is stuck at around 30%, according to the report.
Tourists also seem reluctant to book trips to San Francisco.
With the arrival of the corona virus in 2020, almost all airports came to a standstill. Air travel has since picked up slowly across the country, but some cities have grown faster than others.
In October, the airports in Phoenix and Denver had almost returned to pre-pandemic passenger numbers for domestic travel, according to the report from the City Controller’s office. Seattle and Los Angeles had reached about 80%. In contrast, San Francisco only reached 60% of its pre-pandemic passengers on routes within the United States.
If you look at hotels, the story is similar.
Before the pandemic, San Francisco typically had around 80% of its hotel rooms occupied. In December only about 40% of the rooms were occupied. That’s actually less than the pandemic-era peak of 50% in late July. At this point, vaccines were widespread and the threat from Delta or other variants had not yet fully emerged.
Travelers collect their luggage on December 30th at the Palace Hotel’s valet parking line. Hotel occupancy is around 40% in December, up from a peak of 50% in the pandemic era at the end of July 2021. (Craig Lee / Der Prüfer)
As a side perk: the average hotel room in San Francisco prior to the pandemic was over $ 300 a night, but visitors could snap up a booking for around $ 175 around the Thanksgiving holiday.
The report found that other major cities are recovering both their rates and occupancy rates much faster. Phoenix and San Diego are making roughly as much per hotel room per night as they did before the pandemic.
All in all, these numbers suggest that downtown San Francisco businesses continue to struggle without guaranteed demand from tourists and commuters.
It is possible that many of the people who stayed have just shifted their spending from downtown to their local trade corridors. While the Controllers report leaves out the spending patterns by neighborhood, it suggests that San Francisco residents have not returned to the same level of economic activity as they did before the pandemic within the city limits.
One of the best proxies for this concept is the time people spend outside of their home. When people are out and about in their neighborhood, they spend money in local shops, use public transport, and generally participate productively in civic life. If they stay indoors, much of this economic activity will be lost or instead diverted to online retailers, many of whom are not on-site.
Compared to January 2020, San Francisco residents still spend 15% less, while that number is closer to 5% nationwide. Importantly, however, the San Franciscans reduced their absence from home by nearly 40% in March 2020, while the state average fell closer to 25%. In other words, San Francisco residents have been more cautious about accommodation from the start.
The median monthly rental price for an apartment in San Francisco prior to the pandemic was around $ 2,750. It hit its lowest price of $ 2,000 in January 2021, but began to grow steadily through the first half of the year. This progress has stalled; The average monthly asking rent for an apartment was $ 2,250 in November, according to the report.
Small businesses remain constrained. Local traders’ confidence that a recovery is inevitable remains below the national average and new store openings have stagnated.
More than 220 stores – classified as Retail and Commerce, Neighborhood Services, or Restaurants and Bars – opened in San Francisco in January 2019. By comparison, that number dropped to around 130 in November 2021.
If you look at the speeds on the motorway, the City Controller’s report comes to the conclusion that more people are driving. Decreasing vehicle speeds indicate more traffic jams on the roads. The latest numbers from November show an average speed that is below the pre-COVID average.
Traffic jams on Highway 101 near downtown San Francisco in August. The latest data shows a decrease in vehicle speeds along the highways in and out of the city, with average speeds below pre-Covid-19 pandemic levels. (Kevin N. Hume / The Examiner)
However, this may not indicate that more people are on the move, but that they have shifted their mobility from local public transport to private transport. The number of people exiting BART trains at Embarcadero, Montgomery, Powell and Civic Centers has seen weak growth in recent months, hitting just over 20% of the pre-pandemic passenger numbers, according to the report.
Most of the data in the report comes from before the advent of the Omicron variant, which arrives inconveniently in the middle of another Christmas season. The recent surge has already resulted in changes to public health protocols, including temporary mask returns and the urging of many companies to require full empowerment of customers.
Omicron is also impacting major events, including the cancellation of the San Francisco fireworks display, changing the advice of public health professionals on attending major events, and staffing shortages in companies already struggling to survive.
cgraf@sfexaminer.com
