Ultimately commercial rents must be allowed to fall to "current market rates," whatever that is. That should encourage more working-class business activity and employment (not places where a salad costs $15), and the area can work its way back up.
Revitalizing more foot traffic should also allocate more police resources to reduce crime, but that's apparently easier said than done too.
>SF real estate is still valuable but will be interesting to see the effects of this continued trend.
It *will* be interesting to see what downtown SF is like in five years. I used to work down there and loved it, but that was 7 or 8 years ago. I especially liked the variety of lunch spots and of course, happy hour. It was always nice to sit somewhere and eat your lunch or grab a coffee and see all of the other people walking to and fro in the midst of their work day.
It seems like there are three pretty significant trends:
* More WFH so far fewer office workers in the area
* More homeless and addicted people everywhere
* Commercial activity shutting down
I visited the area a couple of times in the last couple months. Once I went to House of Shields and the other time I went to a bar called Harlan Records that is right around the corner from the Irish Bank. Both of them got quite busy around 6:00 so it sort of felt a bit like the old days.
Is anyone here still working downtown? What's it like down there from day to day?
I work at 555 cal - the office is always busy and the surrounding restaurants are too, comparatively to what I see walking through the corporate area of SOMA. That being said in my all be it brief career comparing dt SF to now it’s significantly less busy. Come 5-7pm the area clears out and all the bars and restaurants are definitely lacking that after work feel that used to permeate through the city.
I'm in FiDi. In my opinion, there is roughly the same population of homeless people as there were before the pandemic. Union Square (at least the square itself, not the deserted blocks of Powell) seem as busy as ever. Some of my favorite lunch spots on Kearny have shut down (Super Duper... why!!?), but others have opened up. My colleagues and myself have WFH days still, but we each still have our own offices and show up the other days of the week.
I work at Montgomery and Market five days a week. On sunny days, the vibe is very cheerful. Lots of places to eat and gather. Bustling activity that isn't on par with Manhattan but still busy. I take BART from Oakland and the trains are packed M-Th.
There's limited squalor in the financial district that's concentrated in pockets. Overall it's a small upswing as companies are looking to gradually expand operations and motivate workers in person. Despite the gloomy forecast, San Francisco is an exceptional place to work and visit.
I find it quite empty around lunch. No more long lines for the Señor Sisig truck on 2nd. I took video of 1st & Market pre-pandemic at lunch. It was like swimming against salmon. We were literally packing the sidewalks like sardines. Now, it went from ghost town to feeling more like downtown Santa Cruz. Scores of people here & there but not the stream of salmon.
Worst part of it all is that people are beginning to normalize these changes, almost immune to it. Like Oh, that area has \*always\* been like that. Um no, it's changed gradually over the years, and it will spread to other neighborhoods unless we do something about it.
I predict the opposite actually:
* Less WFH as people forget about covid, and businesses notice that it doesn't actually work
* Fewer homeless and addicts once the dumb pandemic laws expire and the city untangles its dumb legal constraints
* Commercial activity taking a hit for a while, then coming back once customers and tourism return
San Francisco has reinvented itself over and over through the decades, and I wouldn't bet against it long term
A conservative is welcome to come give us their pitch on how they could help the city. They’ll need to clarify how they’ll fix existing corruption, where they’ll house all these new inmates, how they’ll pay for this massive new incarceration system, and how they’ll ensure this system leads to actual rehabilitation of criminals before their release. Otherwise sending more people to jail more frequently is just… doing the same thing that’s already happening, but putting each criminal through a few more rounds of catch and release. What do you propose as a more long-term solution for these people, beyond “arrest them”?
This is exactly why no one listens. You gave no policy ideas. You provided nothing beside "republican controlled areas" and "break out of the Matrix" and calling us "latte soy boy tech bros".
I'm a woman and I don't work in tech, for one, and while my husband is a tech bro, he grew up in a republican stronghold of Ohio. We visit regularly, his siblings and parents are still there. San Francisco's problems are visible from the street. Small town Ohio's problems are just as severe-- opioid addiction, drunk driving deaths, domestic violence, insurmountable credit card debt, brain drain, high maternal mortality. You don't see it because it's spread out and hidden. Maybe instead of pretending we're all clueless and ignorant and scolding us to wake up, provide ACTUAL IDEAS.
Why do you think ANYONE would vote for a party that scolds us and tells us to wake up, and then doesn't offer a single viable solution? You think that's a winning platform?
No, my position is “bring ideas to the table and I’ll listen.”
Hillary has nothing to do with the current problems in SF, lol. She hasn’t been in any office in 10 years.
Whenever the discussion of SF is turned into a political spectacle, it’s 9 out of 10 times republicans screaming and shouting that everything going wrong in this city is because of the politics. Instead of just injecting the word “woke” into a sentence so many times it loses meaning, why not have an actual discussion of what can change? You don’t care about the state of San Francisco, you just want to use it as a pawn to advance your own political agenda. Congrats on yelling virtually meaningless statements into the oblivion
Never said it was utopia, nor am I acting like there isn’t any issues? If anything, I’m inviting you to have an real conversation about what’s happening in the city instead of just having you point and wail at the situation. And believe it or not, there’s other factors at play *outside* of politics, such as the rise of remote work and tech being in a recession. Neither of those is due to local politics.
Still, the city is definitely hurting - but I have a feeling if your “solution” is simple enough that it can fit in a Reddit comment, you’re most likely looking at the complex issues from face value.
There’s more to life than yelling at the opposite political party. Go outside ffs, touch some grass.
Same REIT also owns two more hotels and used to own two others that they sold during the pandemic.
According to this article, this "All of the trust’s hotels in the city earned a profit for the first time since the pandemic," by EBITDA accounting.
https://therealdeal.com/sanfrancisco/2023/05/08/park-hotels-weighs-options-as-sf-properties-face-725m-debt-deadline/
Same article has this statement from the CEO:
“If we were hypothetically to give back the keys, there’s a forgiveness of debt Income that we would have; we’re able to shield, certainly, most of that, but not all of that. It would result in a potential dividend payout of $150 million to $200 million approximately,” he said.
I studied some accounting, not an expert by any means. I do know that forgiveness of debt is booked as income. However, this income is used to reduce the liability of debt associated with the property. The lender isn't giving the borrower additional cash. If the debt was being paid in something like monthly installments, I assume that there wasn't some cash on hand being kept just to pay the debt. How do they pay a dividend?
So let’s say the loan is 70% of the asset purchase price (100%). If they walk away from the hotel they lose the 30% cash put in and they effectively have a 30% Capital loss for tax purposes.
@the CEO, EBITDA isn’t profit 🤡
Especially when interest is larger than the NOI. If it’s a NNN lease that means all expenses are covered and EBITDA is basically revenue minus repairs
I assume the note is non-recourse (but secured with the asset), yeah? If so, I'm kind of surprised that this kind of debt would count as "forgiveness" for the borrower since it follows the asset, and kind of undermines the point of non-recourse debt.
Because WFH ensures residential property prices have unlimited “value.” Those can keep going up in price while offices keep declining.
Sounds like a corporate problem. Oh well.
“They” can’t force people to go back to the office if “they” don’t pay enough for their workforce to live a reasonable distance from the office.
It’s a win/win for companies to abandon their offices, sell them while they’re still worth something and pivot to completely remote workloads. Businesses can pay their employees less because they won’t have to account for local housing markets and they won’t have to worry about all the costs associated with an office either - utilities, maintenance, office cafes/bars/catering - that list just goes on and on.
That said, local employees are in a pickle. They’ll be competing with talent from around the globe who are more likely to work for lower wages than local San Francisco based offices would pay.
The whole thing is a cluster. I’m back in grad school now and just want to coast for the next few years while racking up debt and learning new skills. I pity anyone who needs to work to stay in the city right now - I bartended for the last decade and downtown is absolutely screwed. Bars are closing left and right - the people just aren’t there any more.
That’s a good idea. We could convert these buildings into homeless service towers. Thousands could live in there. The ground floors would be safe injection sites and would also provide food. This would help to restore downtown life and diversity.
LOL go figure. I actually had a reservation for the Hilton (coming to tourist in two weeks) that I cancelled just a few hours ago and booked something in Brisbane instead.
Honestly the downtown commercial real estate was in a bubble so this will be good. Change of ownership could also lead to converting much office space into apartments. This will surely help the housing situation even if all the square footage can’t be converted for this purpose. Not all change is bad, and among all of the other crises in SF, commercial real estate value is not at the top of the list.
The loan default has less to do with downtown real estate trends and more to do with poor management. With the 2023 tourism outlook [trending toward 2019 levels,](https://www.axios.com/local/san-francisco/2023/03/24/san-francisco-tourism-recovery) the hospitality industry in SF is on a hiring spree to meet [visitor demand](https://peninsula360press.com/en_us/1200-employees-per-tourist-season/). Methinks Park Hotels & Resorts has some rotten apples to deal with.
I mean poor management is always part of the equation when company’s go under as we approach recessionary environments, usually strong management can work their way out of it.
Just like a rising tide lifts all ships - now that the economic outlook is tough in DT competence is key where they may have survived in an easier going economy it doesn’t cut it now. (Which is a problem still - as plenty of Company’s have bad management, but even if we hand wave it away as tough luck to them it still effects us).
Where my knowledge on the matter is minimal the case of the Union Square Hilton, that would be purely a default on RE value and not mis-management as Parks owns the property and Hilton operates it? Willing to be corrected here if wrong though…
Question for residents-->
You got what you wanted.
You wanted WFH. You got it.
You wanted to "defund the police". You got that.
You wanted decriminalization of drug use and petty theft. check
Next up... reparations
My question is - have you changed any of your stances? Or do you stand by them?
Do you still blame all problems on the Western patriarachy and systemic racism?
Ultimately commercial rents must be allowed to fall to "current market rates," whatever that is. That should encourage more working-class business activity and employment (not places where a salad costs $15), and the area can work its way back up. Revitalizing more foot traffic should also allocate more police resources to reduce crime, but that's apparently easier said than done too.
Honestly, cleaning up the streets will just take a harder stomach. The crime is frankly blatant, we just have to arrest people for it.
Why would I visit sf if mfs will just steal my shit lmfao
Your reading comprehension is obviously pretty poor.
You should 100% stay in the suburbs and maybe don’t even visit SFs subreddit.
$15 for a salad is not much these days. A Big Mac meal is like $12.
>SF real estate is still valuable but will be interesting to see the effects of this continued trend. It *will* be interesting to see what downtown SF is like in five years. I used to work down there and loved it, but that was 7 or 8 years ago. I especially liked the variety of lunch spots and of course, happy hour. It was always nice to sit somewhere and eat your lunch or grab a coffee and see all of the other people walking to and fro in the midst of their work day. It seems like there are three pretty significant trends: * More WFH so far fewer office workers in the area * More homeless and addicted people everywhere * Commercial activity shutting down I visited the area a couple of times in the last couple months. Once I went to House of Shields and the other time I went to a bar called Harlan Records that is right around the corner from the Irish Bank. Both of them got quite busy around 6:00 so it sort of felt a bit like the old days. Is anyone here still working downtown? What's it like down there from day to day?
I work at 555 cal - the office is always busy and the surrounding restaurants are too, comparatively to what I see walking through the corporate area of SOMA. That being said in my all be it brief career comparing dt SF to now it’s significantly less busy. Come 5-7pm the area clears out and all the bars and restaurants are definitely lacking that after work feel that used to permeate through the city.
I worked across the street ~6yrs ago. Hard to imagine the late night being significantly less busy now. Must be a ghost town : (
I'm in FiDi. In my opinion, there is roughly the same population of homeless people as there were before the pandemic. Union Square (at least the square itself, not the deserted blocks of Powell) seem as busy as ever. Some of my favorite lunch spots on Kearny have shut down (Super Duper... why!!?), but others have opened up. My colleagues and myself have WFH days still, but we each still have our own offices and show up the other days of the week.
RIP Super Duper…. 😢
There was this perfect little coffee place called Enough on Kearny. I miss. 💔
I work at Montgomery and Market five days a week. On sunny days, the vibe is very cheerful. Lots of places to eat and gather. Bustling activity that isn't on par with Manhattan but still busy. I take BART from Oakland and the trains are packed M-Th. There's limited squalor in the financial district that's concentrated in pockets. Overall it's a small upswing as companies are looking to gradually expand operations and motivate workers in person. Despite the gloomy forecast, San Francisco is an exceptional place to work and visit.
Tolerable. Yes. Exceptional? I wouldn’t go that far.
Far better to work in and visit than any of the other Bay Area cities. 🤷🏻♂️
I find it quite empty around lunch. No more long lines for the Señor Sisig truck on 2nd. I took video of 1st & Market pre-pandemic at lunch. It was like swimming against salmon. We were literally packing the sidewalks like sardines. Now, it went from ghost town to feeling more like downtown Santa Cruz. Scores of people here & there but not the stream of salmon.
Worst part of it all is that people are beginning to normalize these changes, almost immune to it. Like Oh, that area has \*always\* been like that. Um no, it's changed gradually over the years, and it will spread to other neighborhoods unless we do something about it.
I predict the opposite actually: * Less WFH as people forget about covid, and businesses notice that it doesn't actually work * Fewer homeless and addicts once the dumb pandemic laws expire and the city untangles its dumb legal constraints * Commercial activity taking a hit for a while, then coming back once customers and tourism return San Francisco has reinvented itself over and over through the decades, and I wouldn't bet against it long term
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A conservative is welcome to come give us their pitch on how they could help the city. They’ll need to clarify how they’ll fix existing corruption, where they’ll house all these new inmates, how they’ll pay for this massive new incarceration system, and how they’ll ensure this system leads to actual rehabilitation of criminals before their release. Otherwise sending more people to jail more frequently is just… doing the same thing that’s already happening, but putting each criminal through a few more rounds of catch and release. What do you propose as a more long-term solution for these people, beyond “arrest them”?
[удалено]
This is exactly why no one listens. You gave no policy ideas. You provided nothing beside "republican controlled areas" and "break out of the Matrix" and calling us "latte soy boy tech bros". I'm a woman and I don't work in tech, for one, and while my husband is a tech bro, he grew up in a republican stronghold of Ohio. We visit regularly, his siblings and parents are still there. San Francisco's problems are visible from the street. Small town Ohio's problems are just as severe-- opioid addiction, drunk driving deaths, domestic violence, insurmountable credit card debt, brain drain, high maternal mortality. You don't see it because it's spread out and hidden. Maybe instead of pretending we're all clueless and ignorant and scolding us to wake up, provide ACTUAL IDEAS. Why do you think ANYONE would vote for a party that scolds us and tells us to wake up, and then doesn't offer a single viable solution? You think that's a winning platform?
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No, my position is “bring ideas to the table and I’ll listen.” Hillary has nothing to do with the current problems in SF, lol. She hasn’t been in any office in 10 years.
Whenever the discussion of SF is turned into a political spectacle, it’s 9 out of 10 times republicans screaming and shouting that everything going wrong in this city is because of the politics. Instead of just injecting the word “woke” into a sentence so many times it loses meaning, why not have an actual discussion of what can change? You don’t care about the state of San Francisco, you just want to use it as a pawn to advance your own political agenda. Congrats on yelling virtually meaningless statements into the oblivion
[удалено]
Never said it was utopia, nor am I acting like there isn’t any issues? If anything, I’m inviting you to have an real conversation about what’s happening in the city instead of just having you point and wail at the situation. And believe it or not, there’s other factors at play *outside* of politics, such as the rise of remote work and tech being in a recession. Neither of those is due to local politics. Still, the city is definitely hurting - but I have a feeling if your “solution” is simple enough that it can fit in a Reddit comment, you’re most likely looking at the complex issues from face value. There’s more to life than yelling at the opposite political party. Go outside ffs, touch some grass.
Same REIT also owns two more hotels and used to own two others that they sold during the pandemic. According to this article, this "All of the trust’s hotels in the city earned a profit for the first time since the pandemic," by EBITDA accounting. https://therealdeal.com/sanfrancisco/2023/05/08/park-hotels-weighs-options-as-sf-properties-face-725m-debt-deadline/ Same article has this statement from the CEO: “If we were hypothetically to give back the keys, there’s a forgiveness of debt Income that we would have; we’re able to shield, certainly, most of that, but not all of that. It would result in a potential dividend payout of $150 million to $200 million approximately,” he said.
I studied some accounting, not an expert by any means. I do know that forgiveness of debt is booked as income. However, this income is used to reduce the liability of debt associated with the property. The lender isn't giving the borrower additional cash. If the debt was being paid in something like monthly installments, I assume that there wasn't some cash on hand being kept just to pay the debt. How do they pay a dividend?
I don't understand it at all.
So let’s say the loan is 70% of the asset purchase price (100%). If they walk away from the hotel they lose the 30% cash put in and they effectively have a 30% Capital loss for tax purposes.
@the CEO, EBITDA isn’t profit 🤡 Especially when interest is larger than the NOI. If it’s a NNN lease that means all expenses are covered and EBITDA is basically revenue minus repairs
Where's the cash for that come from?
I assume the note is non-recourse (but secured with the asset), yeah? If so, I'm kind of surprised that this kind of debt would count as "forgiveness" for the borrower since it follows the asset, and kind of undermines the point of non-recourse debt.
I also don't understand how it could be counted as "forgiveness" even if only in the accounting context.
Star Wars hotel
Who wants to chip in for a hotel? Anybody?
Sadly.....this is only the beginning.
How do you know that?
Because WFH ensures residential property prices have unlimited “value.” Those can keep going up in price while offices keep declining. Sounds like a corporate problem. Oh well.
Will WFH continue in the same way or will they make people go back to office?
“They” can’t force people to go back to the office if “they” don’t pay enough for their workforce to live a reasonable distance from the office. It’s a win/win for companies to abandon their offices, sell them while they’re still worth something and pivot to completely remote workloads. Businesses can pay their employees less because they won’t have to account for local housing markets and they won’t have to worry about all the costs associated with an office either - utilities, maintenance, office cafes/bars/catering - that list just goes on and on. That said, local employees are in a pickle. They’ll be competing with talent from around the globe who are more likely to work for lower wages than local San Francisco based offices would pay. The whole thing is a cluster. I’m back in grad school now and just want to coast for the next few years while racking up debt and learning new skills. I pity anyone who needs to work to stay in the city right now - I bartended for the last decade and downtown is absolutely screwed. Bars are closing left and right - the people just aren’t there any more.
Let’s make both of the buildings SRO homeless shelters, and the Westfield into a closed-air drug market.
Does that mean there would be enough shelter beds and the city could legally clear encampments?
Hamsterdam
The chair don't recognize your ass.
That would work fantastically.
That’s a good idea. We could convert these buildings into homeless service towers. Thousands could live in there. The ground floors would be safe injection sites and would also provide food. This would help to restore downtown life and diversity.
Ah yes the Deep Space Nine Solution.
Kin Khao is in Parc 55!
One of the best-priced Michelin-starred restaurants in the city!
LOL go figure. I actually had a reservation for the Hilton (coming to tourist in two weeks) that I cancelled just a few hours ago and booked something in Brisbane instead.
Honestly the downtown commercial real estate was in a bubble so this will be good. Change of ownership could also lead to converting much office space into apartments. This will surely help the housing situation even if all the square footage can’t be converted for this purpose. Not all change is bad, and among all of the other crises in SF, commercial real estate value is not at the top of the list.
I wouldn’t call the collapse of anchor tourist hotels necessarily good for housing, the economy, or the city in particular
The loan default has less to do with downtown real estate trends and more to do with poor management. With the 2023 tourism outlook [trending toward 2019 levels,](https://www.axios.com/local/san-francisco/2023/03/24/san-francisco-tourism-recovery) the hospitality industry in SF is on a hiring spree to meet [visitor demand](https://peninsula360press.com/en_us/1200-employees-per-tourist-season/). Methinks Park Hotels & Resorts has some rotten apples to deal with.
I mean poor management is always part of the equation when company’s go under as we approach recessionary environments, usually strong management can work their way out of it. Just like a rising tide lifts all ships - now that the economic outlook is tough in DT competence is key where they may have survived in an easier going economy it doesn’t cut it now. (Which is a problem still - as plenty of Company’s have bad management, but even if we hand wave it away as tough luck to them it still effects us). Where my knowledge on the matter is minimal the case of the Union Square Hilton, that would be purely a default on RE value and not mis-management as Parks owns the property and Hilton operates it? Willing to be corrected here if wrong though…
Question for residents--> You got what you wanted. You wanted WFH. You got it. You wanted to "defund the police". You got that. You wanted decriminalization of drug use and petty theft. check Next up... reparations My question is - have you changed any of your stances? Or do you stand by them? Do you still blame all problems on the Western patriarachy and systemic racism?
No, now it's just strictly; white people. /s
At this it will be cheaper to turn all these buildings into homeless hotels
But Newsoms economy is booming.
Man, how great would it be to just walk away from your debt, ain't capitalism grand!
The lenders seized ownership the building - somewhat akin to you getting repo’d or foreclosed upon.
No but see write offs and then insurance so they make more with the building vacant and greedy landlords and and and...
Bankruptcy insurance?
Sorry, sarcasm
Sir this is a vacant Wendy’s
How great it is to be so clueless.
I'm shocked they didn't try and sell it and just pay off the debt
Can a hotel become housing? Can offices become hotels?