➡ The once-buzzing San Francisco financial district now witnesses a vacancy rate of over 35%, the highest in its history due to impacts from the pandemic and ongoing issues including poor management and investment. The issues in San Francisco resonate with cities like Detroit and Nevada, which have also been significantly hit by crises, reflecting the critical need for cities to diversify their economy, invest in infrastructure and education, and foster partnerships between business and legislation, rather than depending heavily on a single industry.
➡ The text discusses the struggles of San Francisco’s tech industry, compounded by issues of public safety and housing. Despite challenges, San Francisco continues to grow its business base. The text also critiques the management of Baltimore’s Hilton hotel by city officials and suggests ways for better urban development. The author strongly disapproves of city-led businesses and promotes private and public partnerships for effective growth.
➡ Mayor Brandon Scott and other influential individuals have announced a plan to pour $5 billion to address Baltimore’s issue of vacant properties. This solution will invest $3 billion over 15 years under a combined funding from the city, state, and private sectors, targeting up to 45,000 properties in need of redevelopment.

The skyline of San Francisco’s financial district is about as picturesque as it gets. An area that was bustling with people several years ago, but one that, according to the numbers, is now more vacant than it ever has been. So right now in downtown San Francisco, we have a vacancy rate of a little over 35%, which is the highest that we’ve ever recorded in the history of San Francisco.

Colin Yao Dukochi is executive director of the Tech Insight center at CBRE, which focuses on the tech industry and how it affects commercial real estate. He says that office vacancy numbers in San Francisco were three to 4% pre pandemic, meaning we’ve seen at least a 30% increase, and that trend may continue, we think. You know, the interesting thing about San Francisco, they say that the office vacancy rate was three to 4% pre pandemic.

And you got to remember that words mean things. So they’ll use terms like pre pandemic or this and so on and so forth. But this has been a long time coming for San Francisco. And that they are going to have. That means one out of every three buildings are vacant. Actually, it’s higher than that because this is what’s really happening. A lot of these offices are vacant, but the tenant holders.

So let’s just say, for example, a small business or even a large business, right? The tenant holders are waiting for the expiration of their lease for these particular buildings. You got hotels that’s closing down. Nobody is going over to San Francisco for conventions or anything like that anymore, or business. And so San Francisco is largely a failed city. The only thing that’s holding San Francisco up is its location.

That’s it. The only reason why California is still California and that they’re still generating revenue, that people still live there, that people are still moving there, because it is a waste. It is a toxic dump, and it is a waste. And it is the reflection of bad management, bad infrastructure. Let me not say infrastructure, bad management, bad legislation, political posturing, being a blue city, not investing in a people, not investing in a education system, not investing in a police force.

And so what you see happening over in San Francisco was a long time coming anyway. But people just endured through the fact that you had such a high homelessness rate that people were getting robbed, that police didn’t really have a presence, cars was being broken into, real estate was outsized. As far as how much that they were charging for you to be able to stay and live in these cities, live, work and play.

But because they were generating so much revenue, because it was on the west coast, meaning that you had Silicon Valley out there, you had a lot of tech entrepreneurs out there and stuff like that. It was propping up the economy over in San Francisco. But once you see a catastrophic event, it’s similar to what happened in Detroit. Obviously much different, because Detroit is not San Francisco or any city over in California, but Detroit, for a long time, had been propped up by a legacy infrastructure.

As far as the businesses that were thriving in the city. Right. We had Ford, Chrysler, GM. You had basically the entire automotive sector, which then propped up a whole lot of other industries, such as contractors and offshoot suppliers, that were actually supplying the automotive industry and the big three and stuff like that. And so even though we wasn’t investing prior to 2008 into anything else, as far as us continuing to being able to transition into not being dependent on automotive industry, all it took was one big problem, one problem to happen throughout the entire country, which basically upended it.

And then it exposed us because we didn’t really have no clothes. The emperor had no clothes. And so when you see all of those mass layoffs that happened in the Michigan economy, because it wasn’t just Detroit. Now, Ann Arbor was largely not hit, even though it’s only 45 minutes, less than 45 minutes away from Detroit, because Ann Arbor had been propped up by the University of Michigan. And that’s like its own economy.

It was like its own city. Right? You have several cities that wasn’t hit as a result of it. But then they start complaining about what the hell was happening in Flint when Flint was one of the biggest thriving cities in the United States of America back in the. Because they largely depended on GM and Ford. Well, mainly GM, because GM had a huge presence over in Flint. But then when you started to see the numbers dwindling in the innovations, and you didn’t need as many workers, and it wasn’t a part of UAW, and you didn’t have to live, work, and play in Flint.

Then you start seeing the problems, the infrastructure. They didn’t have the tax base to continue to reinvest in and fix the economy or fix what it was that was going on in those cities. And it’s the same thing that’s happening in a lot of these other cities across the United States of America. They’re being interdependent on the fact that they are large cities to help them survive. New York, same thing happening.

You got 8 million people living in New York. But the reality is that as long as you’re not investing in the city itself, eventually it’s going to be a wasteland because businesses are only there because other businesses are there until they’re not. When you see businesses moving into other cities, seeing a lot of businesses moving over to Tennessee, Nashville, Texas, Florida, now, Miami now has an entire tech hub over there, you’re seeing the flaws that was being propped up by the fact that they had such a huge tax base.

So you could waste money, or we know that more money is coming in, even though we’re not necessarily serving a purpose or a business. When you’re a business, you have to continuously compete in order to continue to get those resources. When you a city, you just continue to tax the people. And so that’s what was happening over in San Francisco, versus a city that is forced to compete with other cities and remain competitive because they know that as soon as something happens within the economy, the housing market, the recession, the pandemic, you eventually going to go bust again.

That’s what happened to Vegas during the 2008 recession. It happened to Vegas again during the pandemic. They were so interdependent on the casino industry that as soon as tourism suffered, the whole city collapsed. As soon as tourism suffers, the entire city collapsed. You have to be a city that invests in infrastructure, that invests in education, that continues to have a good policy, that competes against other cities. In order to get industries to come and invest there, you have to have low taxes, continue to put incentives for corporations to bring workers into this.

That’s what Detroit did. The reason that Detroit started having a comeback and why we’re starting to thrive is that we consolidated and we brought all of the teams back into the city. We made it a hub. We invested all in a midtown, downtown, Corktown, and all of that type of stuff. We sold the Michigan train station, and now Ford is investing into it in order for it to be a tech hub.

And then we started incentivizing other industries outside of the automotive industry. Even though we still wanted to keep the automotive industry there, GM still has a presence there, Chrysler, Ford, whatever. But we consolidated, and what we did was Dan Gilbert, for example, which is one of the people that I admire as a businessman. He brought all of his quickens, loans, employees, and then he invested into the Detroit infrastructure, which brought jobs, which brought investments.

It eliminated all of the vacant buildings. They renovated everything housing. And now it’s starting to spread out into the other parts of the city because there was a business plan there to not be interdependent on the automotive industry anymore in order for you to be successful. The key to running great cities is a partnership between legislation and business not competing against each other. It’s partnerships between both. You have to incentivize them to come, and then they have to be able to create an environment where you can basically reinvest into the infrastructure of your city that allow for other people to thrive.

Now you got the queue line, you got light rail, you got more investments. The Hudson’s building is going up. Jolo’s arena got torn down because they built Little Caesars arena. You got all four teams literally within 2 miles or a mile of each other. And so you’re creating an environment that allows for people to be able to thrive. But these mayors, these business people, these legislators, they have no clue of what it takes in order to run a city together and make it great again.

That the vacancy rate will probably creep up some more in 2024, probably at least through the first half of the year, I would say, because there still are firms who are consolidating and reducing the amount of office space they have, the challenge still remains remote work and the city’s reliance on tech as its largest industry. And those tech workers, they’ve been working from home for a long time.

Many of those businesses are operating successfully from home. And while the Bay Area council’s Jeff Belisario says homelessness, crime, public safety, and all around cleanliness are still the top concerns among current and potential San Francisco employers, he also says one thing is true. It’s not a doom loop, right? The numbers don’t necessarily suggest that a doom loop would have high unemployment. I would have businesses running to other cities.

That’s not where we are. But we’re not in a spot where we’re thriving and succeeding. Right. We’re kind of surviving. While companies like Nordstrom, Cinema and Old Navy have closed retail locations in the city, Belisario says San Francisco business license data shows that overall, the city is no longer losing more companies than it’s gaining. Still, though, retail vacancy rates have risen to above 18%. In Union Square, Kazuko Morgan of Cushman and Wakefield says businesses are opening up and good news is on the horizon.

They lying to you. They’re lying to you. I’m telling you. They’re lying to you in ways that you could never believe. They lying to you. They want to try to give you hope because it’s easier to sell you hope than real deals or really to give you some insight into what’s happening out here in these streets. They are lying to you in every way possible. Let’s move over to Baltimore because I want to have a conversation about what Baltimore is doing and what’s happening over there.

Controversy has followed this hotel off the drawing board. Arguably claims it would boost convention business were exaggerated. The hotel immediately drew criticism from O’s fans that it blocks the view of the city skyline from inside the ballpark. We haven’t seen any for sale signs yet at the Hilton Baltimore Hotel, but the mayor says selling it is on the table for us. We are open to anything. Mayor. Mayor then had three different hair changes.

What’s up with these black male mayors? What’s the Baltimore’s mayor name? Hold on. Give me a second. Baltimore. I think it’s Andre something. Brandon Scott. Brandon Scott. Brandon Scott then went through three hair changes. You can see down below me that he had the low cut, and then he went from the low cut over into the kid and play. You know what I’m saying? He had the high cut, the high top.

He did his black lives matter. Afro. Hold on, let me get the afro up there. Yeah, he had that. Now you got the S curl. I see you, Brandon, with the S curl. Curling. All right, let me get back to what you were saying. Selling it is on the table for us. We are open to anything when it comes to this. Entertain emotion. His comments following the city spending panel vote.

How come don’t nobody be in your meetings? You all got these huge cities, these blue cities, and then you all complain about them, and then you don’t see nobody in the office actually emphasizing and having conversations about what’s best for the city to give nearly a million dollars in bailout money to the hotel. The money comes from the America rescue Plan act. It’s supposed to be used towards administrative support, legal fees, audit costs, compliance consulting and project management.

This is something that we have to do because we own it and we have to be responsible with the properties and the things that we own. Former city council president Jack Young wanted to sell the Hilton back in 2015. He proposed a resolution to sell it and use the money for rec centers. No, you don’t sell a building, you don’t sell an asset and then use the money for rec centers because it’s a black hole.

Because then where are you going to get the money to maintain the rec centers long term as far as the investing in it, the employees, the infrastructure updates and all of that? Listen, all of that sounds fine and dandy. Do you know how you get rec centers built? Do you know how you get playgrounds built? You know how you get these places taken care of? You don’t take money that you then profit from an, that’s the same thing as selling your mama’s house and then going to buy a car.

It’s the same thing, yo, we need to get these legislators out of office. You don’t sell an asset, which you can sell an asset, but you don’t sell it. And then you take the money and throw it into a rec center. What you do is you partner with businesses in order to incentivize them to support a different part of the city. So, for example, what Detroit did was when the Pistons moved from Auburn Hills into the city, in order to incentivize them to continue to invest in and for it not to become a burden on the city.

They then had Tom Gores, the owner of the Pistons and the Red Wings and all of these different people, and they said, listen, you will be a good corporate partner to actually take on this playground or to rebuild this facility or whatever. And so what they did was they had corporations adopt parks or they had corporations rebuild this particular part of this particular rec center or open up this new rec center over here.

They gave the land to them because it wasn’t benefiting the city, because it wasn’t taking any tax revenue from it. And then they gave it over to them. As long as they also did this as a result of being approved for another project that they’re going to build on and it become profitable as a result of the city. The business owners have to have a great relationship with the legislators.

You don’t just take money from a cell and throw it into a rec center because it’s a black hole. 15 he proposed a resolution to sell it and use the money for rec centers. It was former mayor Martin O’Malley who pushed for a city owned hotel. He vowed to use union labor, campaign finance records at the time show. As he launched a run for governor, several labor groups contributed to his war chest.

City council reluctantly approved hundreds of millions of dollars in bonds to pay for it, and the hotel has struggled to pay down the debt ever since. The Hilton took a big hit during COVID city the hotel still hasn’t bounced back from the lack of business during the health emergency. But even before COVID as Eleven News previously reported, the hotel lost $11 million in 2010 and the following year 11.

4 million. During that time, the hotel had to dip into a reserve account to make bond payments because you, the city, don’t understand how to actually, first of all, Baltimore is not a tourism city. I’m sorry to say Baltimore is not a tourism city. So there’s other factors and things that have to make sense in order for hotels to be able to thrive in any particular city. All right, so it’s not that the hotel is a bad investment.

A, you don’t really have the incentives for people to come to your city, b, you also had the pandemic. C, you probably don’t know how to run the hotel as efficiently as you’re supposed to, and then D, you should have private businesses running that particular thing and figuring out how it is that you can do to capturing a tax revenue from it. You need to be capturing tax revenue and then basically you need to sell it.

But you need to reallocate the funds into something that’ll capture the revenue more effectively that can be ran from a private entity. Cities should not be in the business of owning businesses. They should be in the business of capturing revenue and partnering with business owners to make it thrive. It’s a difference. On Wednesday, the mayor implied days of the city’s operation of the hotel may be numbered as we move forward with.

And so now sharks can smell blood in the water. They going to come in and they’re going to swoop it up for pennies on the dollar and they’re going to make a whole bunch of money because of mismanagement by the city. And you got a bunch of legislators that don’t really understand how to get money. They don’t. Reimagining downtown and looking at how things operate, I am quite open to someone coming into operating a hotel to not have the city operate.

Hey, come holl at me. I could teach you. Mayor, get in touch with me. I’m not even going to charge y’all my normal rate. I’m gonna give y’all a discounted Anton Daniels from Anton Daniels millionaire morning show rate to help you all to understand how to run your city more effectively. On the flip side, they’re also trying to spend a billion dollars to solve for the vacancy rates over in Baltimore.

Welcome, everyone. This is the news at eleven. I’m Vic Carter. And I’m Rick Ritter. The big story we’re following tonight, there’s an ambitious new plan in the pipeline now to address vacant properties all across Baltimore city. It would spend as much as $5 billion in public and private money over a deck. I’m sorry, $5 billion to be spent in Baltimore to the tune of at least a half a million dollars a year to solve for the vacancies in the city.

Decade and a half, according to a presentation tonight from Mayor Brandon Scott, along with business and faith leaders WJC is live at eleven from city hall. Christina Mendez on your corner tonight. And Christina, walk us through how this investment now aims to tackle the issue that is certainly plaguing many communities. Well, guys, Mayor Brandon Scott says that this right here will be a roadmap for solving the vacant property crisis in the city and will take public, private and even some state funds to get the job done.

When you invest in our neighborhoods, it will be to the benefit of the entire city. On Monday, a commitment to rebuild Baltimore was laid out. This has to change. Mayor Brandon Scott alongside the Greater Baltimore committee and faith leaders with build announced a plan to invest $3 billion over 15 years to address up to 45,000 properties vacants. At risk structures. 45,000 properties. 45 vacant or abandoned properties in Baltimore.

I need to book a trip to Baltimore and see what the heck is happening out here in these streets. Don’t think I’m not going to be having security with me. 45,000 properties, number one. Number two, why is it always mayors and faith leaders, especially when it comes to the black community, mayors and faith leaders. Why is it always mayors and faith leaders that’s at the forefront of what it is that you supposed to be doing as far as determining what’s happening within your communities? Not business leaders, not people that understand finance, not investors, not speculators, not accountants.

It’s always mayors and faith leaders and empty lots that started pledge from the city of Baltimore for $300 million. The agreement calls for financing the project through a combination of city, state and private funds and for there to be a whole blocks approach when redeveloping. The city needs it and we need our elected officials to stand behind what the community needs. While the blueprint is drawn for how the team intends on tackling the work ahead.

Data from the city shows progress in the vacant property. Look at that craziness. That looked just like the wire. And the wire was made in the 90s crisis. Over the last five years, every time there’s a downtown investment in the harbor, in the sports teams, in the convention center, everybody flocks together. They don’t ask questions, they find the money and they make the commitments. When it’s time for investments in neighborhood, everybody gets a little quiet.

This time I believe it’s extremely different. You know what? I’m going to hold off on this. I’m going to revisit this video tomorrow because my thought is too many and it will make the live stream too long. I’m going to save this video and I’m going to teach you how to manage your city more effectively. Because this ain’t it, big dog. Faith lead. Trust me. We going to get into it tomorrow.

Just give me a second. Give me a bit. I’m going to get there. .