AT&T shuts down flagship store in SF downtown.

AT&T to Close Flagship Store in San Francisco

AT&T is closing its flagship store in downtown San Francisco, becoming the latest major retailer to abandon the city’s troubled downtown.

AT&T, the country’s third-largest cell phone provider, said it will shutter its Powell Street store on August 1.

“Consumer shopping habits continue to change, and we’re changing with them. That means serving customers where they are through the right mix of retail stores, digital channels and our phone-based care team,” a company spokesperson said.

All retail employees affected by the closing will be offered jobs at other AT&T locations in the city, the company said.

Retail Woes in Downtown San Francisco

• Last week, mall company Westfield said it will turn over its downtown mall, Westfield San Francisco Centre, back to its lender, citing challenging operating conditions in downtown San Francisco, which have led to declines in sales, occupancy, and foot traffic.
• Last month, Nordstrom decided to close their Westfield location, citing “unsafe conditions” and a “lack of enforcement against rampant criminal activity.”
• In April, a Whole Foods closed in downtown San Francisco, with drug use and criminal activity near the store playing a role in the decision.

Park Hotels & Resorts also said last week that it has stopped making payments on its $725 million mortgage for its Hilton San Francisco Union Square and Parc 55 hotels. The real estate investment trust said it expects to work toward the “ultimate removal of these hotels from its portfolio.”

Challenges in San Francisco

• At least 352 companies, including Tesla and Oracle, moved their headquarters out of Northern California between 2018 and 2021, according to a report from the Hoover Institution.
• Walgreens closed five locations due to “ongoing organized retail crime,” while Best Buy expressed concerns about workers quitting over retail thefts.

Homelessness and Crime

San Francisco has been in the throes of a homelessness and drug crisis that has come with rampant crime for years now. Homelessness has only gotten worse since before the pandemic.

About 38,000 people are homeless in the Bay Area on a given night, with more than 7,000 people homeless in San Francisco itself. Crime and open-air drug use often accompany the homeless issue.

While overall crime in San Francisco is slightly down this year, certain types of violent crime are up, according to police data. Murder is up 10%, robberies are up 15%, and car thefts are up 5%.

The drug crisis is still raging, although overdose deaths have dropped from their all-time high in 2020 during the thick of the pandemic. In 2022, San Francisco saw 620 fatal drug overdoses, down from 640 overdose deaths in 2021.

San Francisco’s Democratic mayor has proposed spending another $692.6 million on homelessness, but so far, no homeless plan has made a significant dent in the worsening issue. Meanwhile, the San Francisco police department is currently understaffed by more than 500 officers.