San Francisco: Signs of Optimism

The San Francisco turnaround that most people think of.

Politicians and other cheerleaders for the City have said that San Francisco's decline is over. They may just be right.

Tech Leaders Fled San Francisco During the Pandemic. Now, They’re Coming Back.

During the pandemic, scores of Silicon Valley investors and executives such as [Keith] Rabois decamped to sunnier American cities, criticizing San Francisco’s government as dysfunctional and the city’s relatively high cost of living. Tech-firm founders touted their success at raising money outside the Bay Area and encouraged their employees to embrace remote work.

Four years later, that bet hasn’t really worked out. San Francisco is once again experiencing a tech revival. Entrepreneurs and investors are flocking back to the city, which is undergoing a boom in artificial intelligence. Silicon Valley leaders are getting involved in local politics, flooding city ballot measures and campaigns with tech money to make the city safer for families and businesses. Investors are also pushing startups to return to the Bay Area and bring their employees back into the office.

Earlier this month Ian Jacobs, scion to the Toronto-based Reichmann real-estate dynasty and who studied under value investor Warren Buffett, sees opportunity in San Francisco office properties.

Jacobs has lined up commitments of $75 million for his first few deals, the people familiar with the matter said. Ultimately, he hopes to buy 3 million square feet of office space for prices about 70% below what it would cost to build the properties...

Jacobs has told investors it might take San Francisco 10 years to recover, according to his marketing materials. The key to the trade will be buying cheap and holding on until technology companies ultimately return.

Personally I hope San Francisco comes back. Much as I disagree with its governance, when the City sneezes everyone in the Bay Area catches a cold.