San Francisco’s budget: Downtown’s empty offices, a hidden risk

Part 6 of 13-part series: The budget impact of office vacancies

Graphic Courtesy of Kastle Systems

Let’s talk about downtown.

After shelter-in-place orders in March 2020 emptied out San Francisco’s downtown like never in history, return-to-office attendance in the city climbed slowly — until the end of 2022. Since then? It’s been flat.

Despite high hopes, the much-hyped “return to office” has stalled. Empty desks remain the norm.

Why does this matter for the budget? Simple math:

— Empty offices mean lower property values.

— Lower property values mean lower property taxes.

Office towers that once generated millions in tax revenue are sitting underutilized, and their values are sinking. As a result, the city’s property tax base is eroding right beneath our feet.

For a city that relies heavily on commercial real estate taxes to fund basic services, this slow recovery is more than just a business problem — it’s a San Francisco government budget crisis in disguise.

Until downtown truly rebounds, San Francisco’s budget deficit will continue to face pressure from two sides: rising costs and shrinking revenue.

It is difficult for our elected leaders to convince corporate executives to bring their employees back into the office when we have not yet done the same. Return to office is critical for the financial health of our city. To lead, we need city government employees back in the office as soon as possible.

Until downtown truly rebounds, San Francisco’s budget deficit will continue to face pressure from two sides: rising costs and shrinking revenue.

Sources: U.S. Census, California Department of Finance, SFGov.org, Association of Bay Area Governments, San Francisco Chronicle, San Jose Mercury News, San Francisco Examiner, San Francisco Standard. Full cites available on request. 

Marie Hurabiell is the executive director and founder of Connected SF.

Originally published on The Voice of San Francisco on May 13, 2025 by Marie Hurabiell