Monday, August 31, 2020

Canceling San Francisco

Those who happily declare that America’s large blue cities will soon make a comeback often point to commercial real estate.

While New Yorkers are fleeing their city in large numbers, major companies, like TikTok are taking out large long term commercial leases. It might be that office towers are now empty, but still, hope gleams eternal in the Big Apple.

And then there is the case of San Francisco. While San Francisco has not had its fair share of revolutionary violence, looting and arson, the city is grossly overpriced. Young Silicon Valley workers are leaving in droves. Like the exodus from New York’s Upper West Side, tech workers are discovering that they can have a far better standard of living anywhere but in San Francisco. Besides, as you know, the local authorities have happily granted homeless people to encamp wherever they want and to do anything they want on the city’s streets.

It sounds a bit like New York’s Upper West Side.

Anyway, cancel culture has now come to San Francisco. No, not the cancel culture that wants to obliterate your presence on social media. It’s the cancel culture that allows large companies, like Pinterest, to cancel commercial leases in beautiful downtown San Fran. Apparently, Pinterest was going to lead a revival of inner city San Francisco. No more.

It's so bad that Pinterest was willing to pay tens of millions to get out of its lease. That's very bad indeed.

Zero Hedge reports:

Things are going so great in California that Pinterest just paid $89.5 million to cancel its 490,000-square-foot lease at the upcoming 88 Bluxome project in San Francisco. 

The company blames working from home as a result of the pandemic as the reason for abandoning the lease - but we're sure the state's rising taxes, impending real estate market crash and conversion of the property to a temporary homeless shelter in March likely helped contribute to the decision making.

Either way, Pinterest wanted out of the lease so badly they were willing to fork over a hefty sum to ensure they would not be held to it. The company's total lease obligations for the property would have amounted to $440 million. 

Pinterest's CFO told the San Francisco Chronicle: “As we analyze how our workplace will change in a post-COVID world, we are specifically rethinking where future employees could be based. A more distributed workforce will give us the opportunity to hire people from a wider range of backgrounds and experiences.”

That’s corporate PR-speak. The company does not want to alienate anyone, but it is responding to the demands of its workers, workers who do not believe that the abuse they receive in San Francisco is worth absorbing.

It also bears an uncanny resemblance to what Amazon decided to do with their Queens, New York hub after taking a good, hard look at New York City’s politicians. After casting a cold eye on AOC and on Comrade de Blasio, Amazon decided to take thousands of jobs and billions of dollars elsewhere.

Zero Hedge remarks that the Pinterest decision will do the same for San Francisco’s hoped-for redevelopment:

To us, it appears to be more of a statement about San Francisco's real estate market than about Pinterest. After all, the company was the first and only lease commitment "in San Francisco’s 230-acre Central South of Market district, where numerous large commercial and residential projects have been approved after the city raised height limits last year," the Chronicle said.

They were to help contribute to 30,000 new jobs and 20,000 new residents in the district, which the city hoped would fuel more than $2 billion in public benefits. The project is "now in doubt". The proposed 88 Bluxome project was supposed to start construction this year, but current plans for the project are now "unclear". 

For the time being, the area has been converted into a homeless shelter:

And in peak San Francisco fashion, the city converted the tennis club currently on the lot to a homeless shelter in March. 

Thereby you see the future of great American blue cities. But, at least, they can all blame Donald Trump-- moral dereliction that will not bring business or commerce back to their hellholes.


urbane legend said...

I know, I know: hold a contest for the best slogan to go on a t-shirt for how forward thinking we are in San Francisco. You get 2 for 1; it will work for NYC also.

The prize? The winner gets to move out of the city free.

Giordano Bruno said...

The Great Sorting is happening. It will help realign the nation so we can have our divorce. It is a good thing. Leave the cities to the bums, lunatics, pussies, and criminals. They deserve one another.

Sam L. said...

The STUPID is STRONG in these Lefties...