The Downtown Development Corporation has announced a fund to help small businesses in downtown San Francisco, building off the momentum of the city’s Vacant to Vibrant program.
Lea Suzuki/The Chronicle
With downtown San Francisco still fighting to reclaim commercial vitality, the Downtown Development Corp. and its partners have unveiled a $25 million fund designed to accelerate the area’s recovery by helping small businesses open, expand and, crucially, stay in the area.
The effort by the nonprofit formed last year and funded by philanthropic and business heavyweights, builds on the momentum of the city’s pandemic-era Vacant to Vibrant program, which threw a lifeline to independent merchants willing to take a chance on a hollowed-out downtown as office and retail vacancies soared.
Small businesses seeking to open in key downtown corridors — with initial priority given to Powell Street between Union Square and Market Street and the Moscone Center corridor along Stockton Street and Fourth Street — are promised private capital and operational support from the new Downtown Business Fund for securing and building out retail spaces, as well long-term storefront investments.
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The Downtown Business Fund will provide three types of support: grants of up to $500,000 to help cover tenant improvement costs and other expenses like equipment and startup capital; loans ranging from $100,000 to over $1 million with below-market interest rates and flexible terms; and technical support in areas such as leasing, design, permitting and technology.
The fund is meant to signal that there is “no wrong door for businesses that want to be downtown — and that the market and businesses know that downtown San Francisco is open for business,” said Shola Olatoye, DDC’s CEO. Businesses that help attract visitors to downtown and activate its street life will receive priority access to the fund.
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Olatoye said the DDC, in partnership with the nonprofit group SF New Deal, will help coordinate grants and affordable loans while providing an “engaged referral network and expert support in one place” — including from architecture firm Gensler Architects and law firm Cleary Gottlieb Steen & Hamilton LLP as pro-bono legal counsel.
Citizens Bank and JPMorgan Chase are each contributing $10 million to the fund, while Google is also an early backer.
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“Small businesses are the backbone of a healthy downtown, and expanding access to capital is central to Citizens’ work in San Francisco,” said Mark Valentino, who oversees business banking at Citizens Bank. He said the fund underscores the bank’s long-term commitment to the city by helping local entrepreneurs secure the financing they need to grow and contribute to downtown’s recovery.
At JPMorgan Chase, executives framed the effort as part of a broader push to expand opportunity for small businesses nationwide. “Together, we can help create more resilient neighborhoods and a more prosperous city,” said CEO of Chase for Business, Ben Walter.
Olatoye said the moment is ripe for the support that the fund will provide, pointing to recent leasing momentum in the area: Over the past year, some 180,000 square feet of retail space has been absorbed, a reversal from the losses seen in 2023 and 2024 as major retailers like Nordstrom, Old Navy, The Gap and others abandoned their longtime storefronts.
With increasing signals that some of these major retailers are planning to return to Union Square and surrounding areas — some, like Uniqlo, have already reopened in new locations — Olatoye said that the business community’s “confidence” in downtown is growing.
“Downtown is seeing real momentum, driven by the local businesses that make San Francisco special, and that momentum matters for our entire city’s recovery,” said Mayor Daniel Lurie in a statement, adding that the Downtown Business Fund represents the “kind of collaboration is what San Francisco needs more of to make our city more vibrant for everyone.”
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What’s important now is to prevent a backslide, she said.
“Downtown is responsible for 40% of the city’s general fund, so we have to figure out how to not only sustain, but grow that,” Olatoye said, referencing the area’s business ecosystem and its outsized role in funding the city’s budget.
“When you look at the research — the way that people experience retail is fundamentally changing. There’s experiential retail, food and beverage, and it’s no surprise that the corridor that we call the ‘hospitality zone’ is severely under-resourced for food and beverage,” she said.
That work will once again be guided by SF New Deal, the nonprofit that helped turn the city’s Vacant to Vibrant concept into a pipeline for small businesses setting up shop in downtown. Under that program, SF New Deal recruited entrepreneurs, matched them with empty storefronts, and helped shepherd them through the process of opening in a struggling downtown. Now, the group is taking on a similar role with the new fund.
SF New Deal Executive Director Simon Bertrang said the fund is based on lessons learned from the Vacant to Vibrant program over the past three years, which was based on the idea that with “a little bit of money and some free rent, we are able to activate these turnkey spaces.”
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“With the fund, we’ll be able to attract small businesses to really make a long term commitment downtown, rather than just popping up in a vacant storefront,” Bertrang said. “What we have found is that small businesses really have the flexibility, and they are risk takers, and we’re able to tap into that entrepreneurial spirit to really drive a new version of what downtown could be.”
Since its launch last year, the DDC has already emerged as a major financial engine in downtown, raising more than $60 million from backers like OpenAI, Amazon, Anthropic, Ripple Salesforce and the Emerson Collective to bankroll revitalization efforts. So far, these dollars have been deployed toward street cleaning, public space and arts activations, and continuing safety and tourist-centered initiatives like the city’s downtown ambassador program.