S
an Francisco's office leasing activity has returned to pre-pandemic levels, with commercial real estate brokers reporting a surge in deals. Office space vacancies have dropped below 35%, and data shows people are returning to the city as businesses open and expand. Blatteis Realty's Jeremy Blatteis calls it a "gold rush" for business, citing exceptionally busy leasing and sales activity.

    Union Square, once plagued by vacant storefronts, is seeing new deals emerge, including on larger spaces like the former Banana Republic flagship store. Just for Fun, a toy store, has signed a deal to open its fourth location in Union Square this September. General manager Jacob Henson credits Mayor Lurie's efforts to clean up streets and revitalize the city.

    The cleaner streets have contributed to a safer and more vibrant atmosphere, according to Blatteis and other realtors. A spillover effect from Jackson Square and Mission Bay, where AI companies have flocked, is also driving growth in Union Square. Tech companies make up half of Avision Young's deals in the area.

    Data from JLL shows that citywide office leasing has reached pre-pandemic levels, with over 9.2 million square feet of office space leased. The number of people in downtown SF on weekdays has increased by 28% since January 2024, according to cell phone data. Mayor Lurie's focus on improving streets and hosting events is also bringing more people to the city.

    "We are on a new trajectory," says Anne Taupier, Executive Director of San Francisco's Office of Economic and Workforce Development. "Mayor Lurie's efforts combined with our status as the epicenter of the AI revolution are fueling our comeback."