Before Covid, San Francisco businesses opened at a similar pace to stores and restaurants in downtown San Francisco neighborhoods from Excelsior to Glen Park to Sunset.
Since the pandemic, however, new businesses in neighborhoods outside of the city’s downtown core have outpaced those in the central districts of the financial district — SOMA and Civic Center — by 88%, according to a Yelp report.
For the report, Yelp looked at six downtowns: Portland, Austin, New York, Chicago, Miami and San Francisco. Yelp’s number crunchers have released a chart titled “Average Annual Business Growth” for both the city’s downtown areas and outer neighborhoods from 2017 to 2019. He then compared the average annual growth since the start of Covid to business creation. The report only includes businesses with Yelp pages — mostly public-facing shops, restaurants or services.
Not surprisingly, San Francisco, which has the lowest “return to office” number of any downtown, sees more new businesses springing up in outlying neighborhoods than in the financial district or the SOMA or Civic Center. San Francisco’s non-downtown business growth is 88 percent higher than downtown, according to Yelp.
“We’re seeing long-term changes as more companies in San Francisco move to a permanent hybrid work model or, like Yelp, a fully remote workplace, dot the landscape of downtown San Francisco,” Pria Mudan, a Yale data science leader, said in an email. “With fewer people heading downtown to work Monday through Friday, businesses in non-downtown neighborhoods have a greater opportunity to grow with lower rents and operating costs.”
Only Portland saw a bigger difference—there, non-downtown businesses outperformed downtown businesses by 157%. Austin had the third-strongest downtown-versus-suburbs divide, with 74% more non-downtown forms.
Miami, which has aggressively recruited California tech companies since the pandemic, has spurred healthy downtown growth — business growth there has outpaced the neighborhoods by just 7 percent.
One surprise that Yelp researchers unearthed is that San Francisco’s downtown zones and neighborhoods lost a bit of business growth from 2017 to 2019. Downtown neighborhoods lost an average of 0.14% of businesses during that time, compared to 0.76% in the suburbs. .
As of 2020, non-downtown neighborhoods added an annual average of 1.52% of new businesses, dominated by restaurants.
JK Dineen is a staff writer for the San Francisco Chronicle. Email: jdineen@sfchronicle.com Twitter: @sfjkdineen
