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Newly Passed Measure Puts Pressure on Owners of Vacant Storefronts

May 06, 2019

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Effective April 22, 2019, new legislation expands the obligation of property owners to register vacant commercial storefront spaces with the City. The Board of Supervisors may also place a "vacancy tax" on November's ballot, which would tax owners for vacant storefronts after six months of vacancy.

The newly effective measure amounts to an update of a previous ordinance that was passed in 2014. Both were introduced by District 1 Supervisor Sandra Lee Fewer.

The new ordinance makes a number of changes to the previous version, such as shortening the period of time within which an owner must pay the fee required to register the vacant property. Owners now have only 30 days from the date the property becomes vacant to pay the annual registration fee, which remains $711. However, a fine of $2,844 will now be assessed for failure to comply. Supervisor Fewer’s updated legislation also closes a loophole that exempted properties that are “actively being offered for sale, lease or rent.”

Despite a booming economy, San Francisco has a rising number of vacant storefronts. One purpose of the legislation is to try to incentivize landlords to bring down the asking price of rents for storefront retail space. However, critics believe that it is not asking prices which have caused the problem. Rather, the surplus of such spaces is largely the result of the trend toward online shopping, as well as the Planning Department's requirement over the past five or more years that new residential and office development have a maximum number of ground floor retail spaces.

For more information, please contact:

M. Brett Gladstone

415-995-5065 Direct Phone
415-995-3517 Fax

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