On a clear, windy evening three weeks ago, scores of people streamed onto a stretch of South of Market’s 2nd Street that was closed off to cars.
At one end, the Flock of Seagirls rocked ‘80s tribute tunes on the Bingo and Bands stage. A few steps away, a brave soul sang along to a hip-hop remix of “Angel in the Morning” at the Curbside Karaoke station. Up and down the street, people of all ages tried out crafts, raced mini Hot Wheels, and noshed on a dizzying array of snacks, from crispy sushi tacos to handmade momos.
Unlike other San Francisco neighborhood street fairs, this one, called Downtown First Thursdays, has much more riding on its success. It kicked off its third year on May 7, and the reason a coterie of civic and arts organizations first organized it — a pressing need to bring people back downtown — remains a stubborn reality.
The ecosystem of workers, shoppers, and other foot traffic across dozens of blocks north and south of Market Street has not rebounded from the pandemic collapse. As a result, San Francisco’s downtown recovery, especially for small businesses, has been among the nation’s slowest, according to cell phone data and office card swipes. Recent sales tax data underscore the struggles of the Financial District and SoMa.
The monthly Downtown First Thursdays (DFT) is part of SF’s patchwork of revival efforts that include regular parties and one-off concerts and spectacles. There are also economic incentives like small-business grants to fill empty storefronts and tax breaks to convert empty offices into apartments.
These efforts are led by another patchwork of organizations, many supported by SF’s wealthiest residents. One is the Civic Joy Fund, the nonprofit host of DFT and a handful of night markets. Among its donors are Ripple co-founder Chris Larsen and Bob Fisher — son of Gap founders Don and Doris Fisher — and his wife Randi.
The downtown party push began in earnest with Bhangra and Beats, serving up Indian dance music and food in May, July, and September of 2023. Its success — 75,000 attendees and more than $4.4 million in spending at nearby businesses, according to organizers — paved the way for DFT in 2024.
Entering their third year, DFT backers tout similar success: 400,000 revelers and $34 million in sales for local merchants and DFT’s vendor booths. Some businesses consider the street party a saving grace, even if the blessing only comes one night a month.
But as broader indicators continue to lag, city leaders are asking whether the party vibe is providing more than just a temporary distraction.
At an Apr. 27 City Hall hearing, Sup. Bilal Mahmood asked if downtown businesses were reaping benefits on days without entertainment. The answers weren’t very satisfying.
“I don’t know if we keep track of that,” said Diana Ponce De Leon, director of community economic development for the city’s Office of Economic and Workforce Development. She quickly added, “When we do have [events], there’s a huge boost.”
Mahmood rephrased his question: “Do businesses on corresponding corridors benefit from entertainment zones outside of the hours of activation?”
De Leon passed the mic to OEWD’s director of nightlife initiatives Ben Van Houten. “We’re in the process of starting to think about this, but we don’t have any good data,” he said.
Hearing that no one is measuring the broader economic impact of downtown efforts, supervisors expanded their line of questioning: Who, exactly, is overseeing the recovery? As the city continues to throw spaghetti against the wall, is anyone in charge of measuring what sticks?
One self-described public-private partnership launched a year ago to “be a convener,” says one of its executives. The San Francisco Downtown Development Corporation has raised tens of millions of dollars and touts various projects, but there’s no indication that it — or anyone else at this point — is coordinating a recovery that’s now stretching into half a decade.
‘A shot in the arm’
Then again, if tens of thousands of people are spending money downtown, benefiting a handful of merchants, isn’t that good enough? It doesn’t take long to find business owners who want to keep the parties rolling.
Michelle Delaney and David Scott Mabry, who co-own 111 Minna Gallery, have a front row seat to DFT. Their 33-year-old art and event space somehow survived Covid, then DFT gave them a “shot in the arm” when lucrative conventions at the nearby Moscone Center, a big source of the gallery’s pre-Covid business, dried up. “This party paid the bills for the staff in year one,” says Delaney.
Delaney said she expands from seven to 25 employees to handle the monthly DFT crowds, running two bars instead of one plus the Curbside Karaoke. Mabry says DFT visitors have returned to visit the gallery’s morning cafe or to ask about renting the venue.
Binita Pradhan, owner and head chef of Bini’s Kitchen, makes momos and other Nepalese comfort food. She credits her DFT booth for drawing customers to her two restaurants and calls the event a “lifesaver.”
Beyond these anecdotes, DFT backers say the gatherings have delivered “an impact of $34 million” over two years. According to Civic Joy Fund spokeswoman Madeline Johns, that figure is based on a survey of attendees that drew 1,083 responses. The survey asked people to estimate how much they spent during DFT and where they spent it.
About half of the respondents said they spent an average of $111 at downtown businesses during their visits, and slightly more said they spent an average of $56 at DFT booths. Maro Guevara of Into the Streets, an arts organization that helps plan DFT, said organizers extrapolated those responses across 400,000-plus attendees and arrived at estimates of about $24 million spent in businesses and $10 million at booths — a total of $34 million.
The fund isn’t measuring DFT’s economic impact on the other 29 or 30 days of the month. Still, a lot of wealthy SF residents believe their largesse is helping. Larsen and Fisher this year put another $2 million into DFT. (Larsen also recently pledged $5 million to fund “revival” projects on Larkin Street in the Tenderloin.)
The city is investing, too. OEWD says it’s given $18 million in grants and loans to local businesses in the area in the recent fiscal year. Another $4 million was dedicated to the Vacant to Vibrant program, which has opened up 30 storefronts, with 12 extending their leases.
But none of these entities are actually responsible for the long-term vision of downtown. It’s unclear who is.
Disjointed ‘joint effort’
After officials said during the Apr. 27 hearing that no one’s measuring the economic impact of downtown activations, Mahmood and Sup. Myrna Melgar, the Land Use and Transportation Committee chair, had more pointed questions about recovery leadership.
SF Planning principal planner Jeremy Shaw gave a laundry list of programs and agencies involved in downtown revival, including the Department of Public Works, SFMTA, OEWD, and the SF Downtown Revitalization and Economic Recovery Financing District, plus community benefits districts for the East Cut, Yerba Buena, and Civic Center.
Do you think part of the problem of why we haven’t made progress is there’s not one single centralized initiative to drive this?
Sup. Bilal Mahmood
Noting the long list, Mahmood asked who sets priorities. Shaw replied, “It’s not the Planning Department’s pure jurisdiction — each agency has its own capital planning process.”
Melgar disagreed. “It is the Planning Department’s job to create a vision for Market Street,” she said, using the street as a proxy for downtown.
Shaw replied that the work is “a joint effort” and added that “there isn’t a planning process” for the overall effort.
Mahmood interrupted: “Do you think part of the problem of why we haven’t made progress is there’s not one single centralized initiative to drive this — a task force?”
A central entity is what former SF controller Ben Rosenfield called for in a recent report he co-wrote in his new job at urban planning think tank SPUR. Rosenfield and his coauthor, SPUR chief policy officer Sujata Srivastava, said San Francisco needs a quasi-public authority to negotiate real estate deals, plan and carry out capital projects, and publicly finance these endeavors.
There isn’t one, although it seems like the SF Downtown Development Corporation (DDC) is meant to be. “DDC is intended to address the fragmentation among all the players in the downtown recovery,” says chief operating officer Tyler Brandon.
Power-washing and ambassadors
So far, the DDC seems to be making good on its mission to raise lots of money. For its first year, Brandon says metrics of success include funds raised to power-wash 600 city blocks and to pay street ambassadors who provide a range of services, from giving tourists directions to reversing overdoses with the drug Narcan.
DDC has also raised about half the funding for a $45 million Powell Street renovation and $25 million for grants to help new businesses open downtown. The organization has received more than 200 applications for the grants. It has also pledged to raise $20 million for the upcoming $40 million Embarcadero Plaza makeover.
It’s not clear if “addressing fragmentation,” as Brandon puts it, is supposed to lead to a more cohesive strategy. It’s also unclear how DDC exists within City Hall’s decision-making structures.
It’s “leading the revitalization of downtown San Francisco,” according to DDC spokesperson Brian Purchia, yet it’s not a government entity — it’s an “independent nonprofit public benefit corporation.”
Many city departments have a deep network of nonprofit contractors who do work in public health, homelessness, and more. These contractors are accountable (or should be) to the agency for the services they provide.
If a private entity doesn’t like the direction of things, they can take their toys and go home.
Patrick Murphy, University of San Francisco public policy professor
The DDC says it works with city partners and other nonprofits, including community benefit districts. It is “not a city contractor,” says the spokesperson, although its first agreement with the city is soon to go before the Board of Supervisors for approval. The contract is technically a “grant acceptance agreement.” between Recreation and Parks and DDC to govern its fundraising for the Embarcadero Plaza project.
Often these types of agreements govern grants that the city gives to nonprofits. But in this instance, the roles are flipped. DDC is the granting entity, and the city is the recipient. (The agreement allows DDC to back out of the deal if the project’s cost overruns hit $3 million or more.)
The ambiguity of who’s accountable in this public-private relationship is a “very messy” situation, says University of San Francisco public policy professor Patrick Murphy.
The DDC ‘ultimately chooses’
All this multimillion-dollar fundraising is possible, at least in part, because the Board of Supervisors has granted exemptions to strict rules that limit public officials from soliciting donations. These “behested payment” limitations grew out of the Mohammed Nuru and related scandals. Since Lurie’s election, supervisors have twice issued blanket, six-month waivers to allow fundraising for downtown economic revival.
Thanks to the waivers, DDC has received donations from private sources at the request of city officials. “Any donation to the DDC done at the behest of Mayor Lurie or any City staff is regularly reported and publicly disclosed,” the DDC spokesperson tells The Frisc. The funding goes “where the data shows it’s having an impact and for projects like Embarcadero Park where there are funding gaps. The DDC ultimately chooses where we provide funding or support.”
USF’s Murphy hopes the DDC “does well for the city” but is concerned about long-term sustainability when relying on private funders. “If a private entity doesn’t like the direction of things, they can take their toys and go home,” he says.
DDC’s Brandon acknowledges the concern and says the organization is working to bring in new business partnerships for more diverse funding. It’s unclear how those partnerships would work with the city to set priorities or strategies.
While big questions remain unanswered about the impact of downtown efforts and who’s in charge, the folks at ground level just want to get through the next month, and the one after that.
“We’ve got to find a way to get people paid,” says 111 Minna’s Delaney. “We’ve been willing to be flexible and will continue to do so.”