Shopping mall operator Westfield said it plans to give up control of the San Francisco Centre mall after more than 20 years of operation in another sign of San Francisco’s economic struggles.
The company attributed its decision to the “challenging operating conditions in downtown San Francisco, which have led to declines in sales, occupancy and foot traffic.”
The mall operator’s decision to surrender its San Francisco space comes after several of the mall’s major stores announced closures, including Nordstrom and Banana Republic.
Last month, a Westfield spokesperson attributed Nordstrom’s closing to “unsafe conditions for customers, retailers, and employees.”
Once a bustling retail center in the heart of San Francisco, the San Francisco Centre has taken a significant hit in the past few years. Total sales have fallen from $455 million in 2019 to $298 million in 2022, and foot traffic has plunged from 9.7 million visits in 2019 to 5.6 million in 2022, according to Westfield.
Westfield’s exit marks another significant setback for San Francisco, which saw its economy hit hard by the pandemic as many Silicon Valley companies allowed flexible work-from-home policies, resulting in many white-collar workers filtering out of the city. Three years later, corporate America has yet to return in the same numbers: office vacancies in San Francisco have reached a 30-year high.
Westfield is just the latest high-profile business to abandon the city. According to a tally from the San Francisco Standard, twenty retailers near San Francisco’s Union Square have closed their doors since 2020.
Earlier this month, Park Hotels and Resorts, the investment firm that owns Hilton San Francisco Union Square and Parc 55 hotels, also ceased payments to its lender.
In a statement announcing the decision, Park Hotels and Resorts CEO Thomas Baltimore, Jr. said San Francisco’s “path to recovery remains clouded and elongated by major challenges.” Some of those challenges include high office vacancies, a weaker-than-expected convention calendar and “concerns over street conditions,” according to Baltimore.
Westfield said it has already begun transferring management of the San Francisco Centre back to its lender, which will appoint a receiver to operate the property going forward.
Source: CNN
