Hearing on Union Square: city presents recovery plan after Macy’s announcement; supervisors press for concrete Powell Street plan

The Land Use and Transportation Committee held a broad hearing on May 13 about the future of Union Square and the local impacts of Macy’s nationwide store reductions. Sponsor Supervisor Asha Safai described Union Square as one of the city’s “three crown jewels” and said Macy’s late‑February announcement was a “gut punch” to downtown retail.

City staff framed a mix of short‑ and long‑term strategies. Sarah Dennis Phillips and Jacob Bintliff of the Office of Economic and Workforce Development said work focuses on three pillars: clean-and-safe operations (increased SFPD patrols, Safe Shopper initiative), programming and activations (pop‑ups, Winter Walk, Tulip Day and an SF Live concert series) and regulatory/zoning tools. Bintliff highlighted more than $1.5 million in OEWD grants since 2022 for activations and reported multiple new leases at the Emporium and 32 businesses opening or signing leases since fall 2022 in the broader Union Square area.

Ted Egan of the Controller’s Office presented data showing Union Square’s sales‑tax receipts and quarterly spikes below 2022 levels, a CoStar retail‑vacancy figure reported at about 19.5 percent (with caveats about coverage and timing), and hotel occupancy around 60 percent compared with roughly 80 percent in 2019. Egan said retail employment in the San Francisco metro was about 82 percent of 2019 levels and that tourism‑dependent retail subsectors—clothing, jewelry, shoe stores—remain substantially below pre‑pandemic employment (about 64 percent).

The planning department described 2023 legislative changes that expand permissible downtown uses (C3/C3R), allow mixed uses on upper floors and facilitate commercial-to-residential adaptive reuse; two projects (Warfield, 785 Market) had been filed under the reuse program. OEWD said last year’s budget committed $4,000,000 for downtown transformations, with roughly $2,000,000 supporting Powell Street streetscape design and $1.8 million originally intended for vacancy incentives; staff reported shifting part of the storefront funds to activations and that about $500,000 remained available for storefront incentives after RFP results.

Labor leaders from UFCW Local 5 urged protections and retraining for Macy’s workers (about 330 employees at the store) and suggested partnerships for retail-worker training. The Union Square Alliance emphasized perception and safety as drivers of business decisions and urged a marketing/PR strategy to amplify positive activations. Several supervisors pressed OEWD and the planning team for a phased, visual plan and performance metrics before additional capital commitments; equity concerns were raised about resource distribution to other neighborhoods such as the Tenderloin.

Public comment on the hearing produced no speakers. Supervisor Safai asked to continue the item so departments could return with clearer budget breakdowns and design concepts; Chair Melgar moved and the committee voted 3–0 to continue the hearing to the call of the chair.