Westfield is giving up San Francisco Centre, the latest business to withdraw from the city

CNN
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Mall operator Westfield said it plans to relinquish control of the San Francisco Center mall after more than 20 years of operation in another sign of San Francisco̵[ads1]7;s economic struggles.

The company attributed its decision to the “challenging operating conditions in downtown San Francisco, which have led to declines in sales, occupancy and foot traffic.”

The mall operator’s decision to surrender its San Francisco location comes after several of the mall’s major stores announced closures, including Nordstrom and Banana Republic.

Last month, a spokesperson for Westfield Nordstrom attributed the closure to “unsafe conditions for customers, retailers and employees.”

Once a bustling shopping center in the heart of San Francisco, San Francisco Center has taken a significant hit in recent years. Total sales have fallen from $455 million in 2019 to $298 million in 2022, and foot traffic has fallen from 9.7 million visits in 2019 to 5.6 million in 2022, according to Westfield.

Westfield’s exit marks another significant setback for San Francisco, which saw its economy hit hard by the pandemic as many Silicon Valley companies allowed flexible work-from-home policies, resulting in many white-collar workers filtering out of the city. Three years later, corporate America has yet to bounce back in the same numbers: office vacancies in San Francisco have hit a 30-year high.

Westfield is just the latest high-profile business to leave the city. According to a tally by the San Francisco Standard, twenty retailers near San Francisco’s Union Square have closed their doors since 2020.

Earlier this month, Park Hotels and Resorts, the investment company that owns the Hilton San Francisco Union Square and Parc 55 hotels, also stopped payments to lenders.

In a statement announcing the decision, Park Hotels and Resorts CEO Thomas Baltimore, Jr. said San Francisco’s “road to recovery remains cloudy and protracted by major challenges.” Some of those challenges include high vacancy rates, a weaker-than-expected convention calendar and “concerns about street conditions,” according to Baltimore.

Westfield said it has already begun transferring management of the San Francisco Center back to the lender, which will appoint a receiver to run the property moving forward.