San Francisco retailer at risk of closure due to homelessness and office vacancies.
Gump’s Luxury Retailer Faces Closure Amidst San Francisco’s Homelessness Crisis
Gump’s, a historic San Francisco luxury retailer, which opened in 1861, could shut its doors citing the city’s deteriorating homelessness crisis and an unfavorable business climate.
The owner of the store, John Chachas, wrote an open letter to California Gov. Gavin Newsom, Mayor London Breed, and other political leaders calling for a change to the city’s “failed public policies” in a full-page ad published in August in the San Francisco Chronicle.
“Today, as we prepare for our 166th holiday season at 250 Post Street, we fear this may be our last because of the profound erosion of this city’s current conditions,” Mr. Chachas said. “San Francisco now suffers from a ‘tyranny of the minority’—behavior and actions of the few that jeopardize the livelihood of the many.”
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Specializing in luxury home décor and jewelry, Gump’s was acquired by Mr. Chachas after the retailer’s Chapter 11 bankruptcy filing in 2018.
Originating in San Francisco during the renowned California Gold Rush era, the upscale retailer maintains its only physical store a block from the city’s Union Square.
Homeless occupied sidewalks have created an unlivable and unsafe environment for residents and employees, and this also made the city an unwelcoming destination for visitors from all over the world, Mr. Chachas said.
According to a 2022 point-in-time count, there are an estimated 7,754 homeless people living in the city, many in the nearby downtown area.
“It is entirely incompatible to run a successful luxury business, where my customer has to step over needles, human waste, and sometimes people lying on the ground as they walk from their hotel on the northern side of the Union Square to my store,” he told The Epoch Times in an interview after the letter was published.
The homeless crisis, Mr. Chachas said, can be largely attributed to city leaders’ policies.
“[They] don’t really want to face the music of what it’s like to be criticized by not being compassionate to these people that are on the streets. … They just beat around the bush like, ‘Well, we just have to find a way to make it all work together,’” he said.
However, he said that it is impossible for businesses to operate in such an environment where owners are constantly worrying about safety for patrons, saying many visitors have simply stopped coming.
“The customer decides to cancel the conference, canceled a vacation to San Francisco. Overtime, your door counts fall, your absolute business volumes fall, and there is no way to dig your way out of that,” he said.
Additionally, Mr. Chachas said that the decades-long nationwide movement to move individuals out of public mental hospitals in the 1960s is an important reason for the homeless issue people see today.
From 1950 to 1980, the resident population in those facilities fell from 559,000 to 154,000 across the country, according to a 2007 study by the Kaiser Family Foundation.
“We did that as a country, and it created a total failure in terms of American social policy for the care of people that are in need,” he said.
At the state level, then Gov. Ronald Reagan signed the Lanterman-Petris-Short Act in 1967, which banned the practice of institutionalizing patients in California against their will and closed mental institutions across the state.
Empty Offices
Mr. Chachas also suggested, both in the letter and in the interview, that some of San Francisco’s current challenges stem from abandoning office space during the COVID-19 pandemic.
In May, vacancy rates of offices reportedly surged above 31 percent, the highest ever documented in the city—a once-renowned location which held status as one of the world’s priciest commercial real estate markets.
“Businesses in downtowns in America cannot survive … when large office buildings sit 35 percent empty. … [While] you add on top of that, the complexity when you have policies from the cities that contribute to vagrancy and decay,” he said.
Additionally, he criticized the city’s lack of effort to bring people back to work in the office after the pandemic.
“All you have to do is walk around the central business district or the central retail districts in San Francisco or walk [Manhattan’s] Madison Avenue from 59th Street to 96th street and see how many empty storefronts [are] on both sides of that,” he said.
In fact, he said, companies are now encouraging employees to work from home to lower the cost of renting office space.
Such vacancies also appear in governmental agencies, he said.
Earlier this month, federal employees at the Nancy Pelosi Federal Building in San Francisco received a memo from the Department of Health and Human Services advising them to work remotely whenever feasible due to escalating concerns regarding drug use and surging crime near the downtown building.
“You and I are paying taxes so [the government] can rent the building. And yet the people that work in the building are told not to go to their office. … When people aren’t in their offices, cities die. That’s it. Period,” he said.
Police Shortages, Store Closures
A police shortage is also affecting businesses’ willingness to operate in the city, former San Francisco Police Department (SFPD) officer Joel Aylworth said in a recent interview on EpochTV’s “California Insider.”
The record low number of sworn San Francisco Police officers is causing the department to triage some calls that appear less urgent
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