Name: S.F. small businesses owe up to $400 million in unpaid rent, new city report estimates
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S.F. small businesses owe up to $400 million in unpaid rent, new city report estimates

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A new city report unveiled Thursday estimates unpaid commercial rent in San Francisco from April to December 2020 to be between $172.1 million and $404.5 million.The report was released at a Board of Supervisors hearing Thursday on the state of unpaid commercial rent in the city stemming from the pandemic and related public health orders. The report prepared by the Budget and Legislative Analyst’s Office said unpaid rent for office, retail and industrial properties ranged from $19 million to almost $45 million per month from April to December 2020.The meeting tackled the issue of some landlords unwilling to offer rent relief to their tenants.“The city needs to do everything we can to address the harms caused by this minority of landlords,” said Supervisor Rafael Mandelman, one of the officials who called for the hearing. “No one should be able to force a small business out of existence and force another vacant storefront on our neighborhoods with impunity.”There is only so much the city can do to help since the state governs commercial rents — and San Francisco’s resources make a mere dent in alleviating massive amounts of back rent.“That deep hole is far beyond what the city could possibly back fill,” Supervisor Hillary Ronen, who commissioned the report last year, said during the hearing.More for youA slew of businesses — retailers, gyms, beauty shops and restaurants were forced to close for months under Bay Area health orders, causing massive economic devastation during the pandemic. According to the report, 89% to 98% of unpaid rent (excluding hotels) may come from the retail sector, including restaurants and bars, despite the sector making up only around a quarter of total rented commercial property space.Most of the unpaid commercial rent comes from mixed-use properties — commercial and residential buildings — outside of the downtown area, with the “greatest presence in the Mission, Sunset, Richmond, Noe Valley, and Potrero neighborhoods” the report said.Supervisors heard from many small-business owners across the city struggling to pay rent, during Thursday’s session.“Our small businesses are drowning in debt,” Sharky Laguana, chair of the Small Business Commission, said during the hearing. He said he owns a business supporting the live music industry that rents a dozen spaces and hasn’t received rent relief. Now, he faces bankruptcy, which could force him to liquidate his home and childrens’ college saving accounts, he said.Some landlords have sued small businesses for damages over unpaid back rent and illegally locked tenants out of storefronts, attorney Tobias Damm-Luhr, with the Lawyers’ Committee For Civil Rights in the San Francisco Bay Area, told supervisors. It’s harder for business owners who can’t speak English, he said.Updated to include drought zones while tracking water shortage status of your area, plus reservoir levels and a list of restrictions for the Bay Area’s largest water districts.Businesses did get city, state and federal help last year. Gov. Gavin Newsom extended an eviction moratorium to June 30. Rent will still be due after, though, starting as early as July for businesses with more than 50 full-time employees.City and federal grants haven’t been enough. Restaurants and bars didn’t get a proportionate cut of federal funds, and it was harder for small, minority and women-owned businesses to access funds, the city’s Budget and Legislative Analyst’s Office said Thursday.The city has more than $24 million available in grants and loans, and has distributed around $14.5 million. Around 1,405 businesses out of 15,000 applicants, or about 9.4 percent, have received financial assistance ranging from $2,000 to $44,000.More help is coming. Another $12.4 million in grants and $7.6 million in loans to small businesses is expected to pass as part of the Board of Supervisors’ spending plan for the city’s $125 million surplus this fiscal year. The American Rescue Act will also provide funds.Supervisor Dean Preston, who also called for the hearing, expressed frustration that grant money “is really going to the landlord.” He wanted the city to offer more resources to help small businesses.Shwanika Narayan and Mallory Moench are San Francisco Chronicle staff writers. Email: , Twitter:Updated to include drought zones while tracking water shortage status of your area, plus reservoir levels and a list of restrictions for the Bay Area’s largest water districts.

A new city report unveiled Thursday estimates unpaid commercial rent in San Francisco from April to December 2020 to be between $172.1 million and $404.5 million.The report was released at a Board of Supervisors hearing Thursday on the state of unpaid commercial rent in the city stemming from the pandemic and related public health orders. The report prepared by the Budget and Legislative Analyst’s Office said unpaid rent for office, retail and industrial properties ranged from $19 million to almost $45 million per month from April to December 2020.The meeting tackled the issue of some...

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Mallory Moench

Shwanika Narayan

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S.F. small businesses owe up to $400 million in unpaid rent, new city report estimates

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