Speaker 1: Matt Winkler joins us, the founder of Bloomberg News way
Speaker 1: back in the day. He's got a calm that I've
Speaker 1: been waiting for him to write because I'm a huge
Speaker 1: fan of San Francisco, as I've said many times, and
Speaker 1: I'm sad that it's on some tough times and i
Speaker 1: haven't been there recently. But just kind of what you
Speaker 1: read and see and all that kind of stuff, Matt's
Speaker 1: got some analysis says, maybe it's not that bad. Matt,
Speaker 1: What did you find when you went out to San Francisco.
Speaker 1: What are the numbers tell you about one of my great,
Speaker 1: great favorite cities, San Francisco.
Speaker 2: So I have to thank my wonderful colleague, Sheen Pey
Speaker 2: for this, because we talked about San Francisco and what
Speaker 2: we decided to do and he did specifically is compare
Speaker 2: the ten largest companies publicly traded companies in the ten
Speaker 2: largest cities of America. And of course San Francisco is
Speaker 2: not one of the ten largest cities. It's number seventeen
Speaker 2: with a population of you know, maybe eight hundred and
Speaker 2: fifty thousand. The ten companies that are publicly traded that
Speaker 2: are one to ten in San Francisco literally outperformed by
Speaker 2: employee growth and sales growth over five years, all the
Speaker 2: way through twenty twenty five, the top ten cities of America.
Speaker 2: So if things are bad in San Francisco, the business
Speaker 2: of San Francisco, the business people of San Francisco are thriving.
Speaker 2: And you can't, you know, have two narratives like that
Speaker 2: at the same time. Something has to give.
Speaker 3: What are these companies hiring the people their.
Speaker 2: Employee growth within the city limits in the city life. Yeah, yeah,
Speaker 2: totally outperformed Chicago, New York, Dallas, Houston, every city except,
Speaker 2: by the way, number two close, Number two is Los Angeles.
Speaker 1: Okay, yeah, Well that's your moment, that's your bullish California
Speaker 1: callity and make it right.
Speaker 2: And that's another column.
Speaker 1: Yeah exactly.
Speaker 2: But San Francisco is in fact a twenty first century
Speaker 2: economy as measured by the companies that it keeps. And
Speaker 2: I say keeps, I mean whether it's Visa, which is
Speaker 2: a financial company for Airbnb, or Salesforce to name three.
Speaker 2: Airbnb and Salesforce right now are outperforming their global peers
Speaker 2: in market capitalization, sales growth, employee growth.
Speaker 1: What I know you spoke to the mayor of London.
Speaker 1: I'm sorry, the mayor of San Francisco, London Breed. I mean,
Speaker 1: he's been there since she's been there since twenty eighteen.
Speaker 1: So the good, the bad, and kind of where we're going.
Speaker 2: Now, what does her outlook, Well, it's what you would
Speaker 2: expect it to be. She's bullish, I mean, and listen,
Speaker 2: London Breed is really exceptional in the sense that this
Speaker 2: is somebody who grew up literally in the worst part
Speaker 2: of San Francisco and was raised by her grandmother and is,
Speaker 2: you know, a success story in her own right. And
Speaker 2: when she talks about San Francisco, she's very confident because
Speaker 2: guess who she talks to. She talks to the CEOs,
Speaker 2: and not a one of those ten companies that we're
Speaker 2: talking about have any intention of picking up and leaving.
Speaker 2: And the fact that they're out performing their peers in
Speaker 2: bigger cities coast to coast, north to south, east to
Speaker 2: west in the United States of America tells you something
Speaker 2: about San Francisco, which is probably why you like it
Speaker 2: so much.
Speaker 1: I do, and commercial real estate talk to us about
Speaker 1: the vacancy there versus other cities, because it's it.
Speaker 2: You've got vacancy rates that are maybe not as high
Speaker 2: as San Francisco, but close enough in lots of places,
Speaker 2: whether it's in Texas, whether it's in New York, whether
Speaker 2: it's in Illinois. You know, literally all across America, you've
Speaker 2: got coming out of COVID nineteen vacancy rates. Bloomberg News
Speaker 2: reported not too long ago that that trend actually has
Speaker 2: gone favorable in the sense that the worst is over
Speaker 2: and there's a rebound underway. So you would expect by
Speaker 2: that way that to happen because more people were going
Speaker 2: to come back to work. Even at Bloomberg.
Speaker 3: Yep, we're returned to office the owner.
Speaker 2: The owner has already told us that, you know, it's
Speaker 2: going to be a four day week at least in
Speaker 2: the office.
Speaker 1: And our San Francisco office is awesome, by the way,
Speaker 1: it's built on one of those piers out into the
Speaker 1: San Francisco Bay.
Speaker 2: So again kudos Toorrow.
Speaker 3: Well, you know, to that end. So I actually was
Speaker 3: there for a reporting trip I think twenty seventeen, twenty eighteen.
Speaker 3: I had gone as a child, and then I would
Speaker 3: turn in early twenty twenty one, April twenty twenty one,
Speaker 3: I believe, and it was pretty sorry twenty twenty two.
Speaker 3: April twenty twenty two, it's pretty grim. You know, saw crime,
Speaker 3: saw overdose, you know, the whole nine yards. How you've
Speaker 3: spoken with London Breed. How does what's the path forward
Speaker 3: from here? And does this really stand the potential? I mean,
Speaker 3: you see all these companies hiring and whatnot, But you know,
Speaker 3: what do the executives say about how they're you know,
Speaker 3: making people want to live in Francis.
Speaker 2: Well, the executives are very confident about their businesses because
Speaker 2: they talk about them from quarter to quarter to analysts
Speaker 2: and their shareholders. But I think what's more meaningful? And
Speaker 2: London Breed did reference this is not too long ago.
Speaker 2: Last month, in fact, the what used to be called
Speaker 2: the Grateful Dead had a concert in San Francisco. It
Speaker 2: was sold out, or was sold out one hundred and
Speaker 2: twenty thousand people over three days into downtown San Francisco,
Speaker 2: and everybody had a great time and it poured more
Speaker 2: than thirty million dollars into the San Francisco economy.
Speaker 3: That's not a dystopia, right, Well, I mean, but do
Speaker 3: you see the change coming? I think there's specifically some
Speaker 3: rules about theft and burglaries resulting in misdemeanors rather than felonies,
Speaker 3: and this sort of encourages you.
Speaker 2: Yeah, that's a California law law, and there are some
Speaker 2: moves to change the law. There's a California law that
Speaker 2: actually makes it too often you could say, a misdemeanor
Speaker 2: for breaking and entering or for burglary and theft, whereas
Speaker 2: in other cities it's easily a felony. Now that happens
Speaker 2: to be, if you like, an idiosyncrasy of California, and
Speaker 2: it's particularly a cue in San Francisco, but that can
Speaker 2: be changed. Actually, the crime rate in San Francisco violent
Speaker 2: crime rate is way below most major cities. It's near
Speaker 2: the bottom actually among major cities. So that's a better
Speaker 2: indicator of really quality of life in San Francisco.
Speaker 1: I think one of the challenges for the San Francisco
Speaker 1: and the Bay Area in general historically was the cost
Speaker 1: of housing, the cost of living. Is that where we
Speaker 1: in that regard now? Has there been an adjustment or
Speaker 1: is that just California.
Speaker 2: Everybody, especially London Breed will be the ones to say
Speaker 2: they've hired more people over the years than they had
Speaker 2: housing for and that it needs to be that inequality
Speaker 2: needs to be rectified, and it's actually being led at
Speaker 2: the state level by the governor himself to create housing,
Speaker 2: particularly public housing, in lots of places that his historically
Speaker 2: have resisted it for local reasons, and the state is
Speaker 2: likely to circumvent those local restrictions once and for all
Speaker 2: so that you can have a big increase in housing.
Speaker 1: Well, lately, one of the stories I saw MATTT just
Speaker 1: corporate conferences. San Francisco has historically been a great conference
Speaker 1: down because it's such a great town. Even that's taken
Speaker 1: a knock over that.
Speaker 2: Well, there's going to be an Asia Pacific Summit in
Speaker 2: San Francis. That's right, it's going to be a pretty
Speaker 2: big deal, and all the CEOs in San Francisco are
Speaker 2: going to be part of that Asia Pacific summit because
Speaker 2: those companies are very much part of the global and
Speaker 2: dare I say Asia Pacific economy.
Speaker 3: Yeah, there's a stickiness to this and then maybe negativity
Speaker 3: around San Francis. I just got to feel like, you
Speaker 3: see this data coming back, you see some of this data,
Speaker 3: How long does it take to sink in?
Speaker 1: Yeah, exactly. Well, all I know is there's a ton
Speaker 1: of engineers there and you always need engineers. Thanks so
Speaker 1: much for joining.
Speaker 2: STT.
Speaker 1: Winkler is the editor in chief emeritus and the founder
Speaker 1: of Bloomberg News. Greg Collums Shinpei his man there with
Speaker 1: all the data, and they bring it