With the new year in full swing — bringing with it new challenges, thorny questions, and political dramas— The Standard is again checking in on the cold, hard numbers to see how San Francisco is faring across a range of categories.
Did 2025 wrap up with a big, shiny “boom loop” bow, or is it time to shed our rose-colored glasses as we stare down 2026?
We dug into the data on tourism, economic activity, the real estate market, crime, public transit, and more to see where the city is thriving and where the hype is outperforming the reality.
Tourism
The SF Travel Association hasn’t released its final count of 2025 visitors or its 2026 forecasts, but projected data from August showed that the city was slowly making progress on luring back tourists. The biggest challenge this year was the “Trump slump”: border policies, tariff decisions, and safety concerns that spurred a projected 3.2% drop in international visitors.
Weekly hotel occupancy rates passed the 2019 average several times during the year, though not with any regularity. The average daily rate for rooms, $237, lagged significantly behind the 2019 average of $317.
However, there are reasons to be hopeful: 2026 brings the Super Bowl and a handful of World Cup games to the Bay Area, which will likely juice visits and bookings in San Francisco. So far, the Moscone Center has scheduled 36 conferences this year, versus 34 in 2025. These events are projected to generate 670,000 hotel room bookings.
It helps that after years of media bashing, San Francisco’s glow-up is getting attention (opens in new tab). San Francisco ranked No. 2 on car rental company Sixt’s list of the top 20 trending destinations for 2026 (based on Google and TikTok searches), behind only Las Vegas.
Our take: It’s too soon to say. San Francisco’s revamped reputation and exciting sports lineup could be great drivers of tourism, but President Donald Trump’s unpredictable foreign policy decisions could continue to outrage and deter much-needed foreign visitors.
The economy
Jobs in the city are down — with tech losses piling up — while unemployment is rising. The number of people without work trended up through September (the most recent data available) to 4.2%. That’s nearly double the unemployment rate in spring 2022.
Still, the number of jobs posted on Indeed ticked up slightly in November, according to an analysis by the SF controller And everyone’s still bullish on the AI industry. Venture capital funding is concentrated in the Bay Area (opens in new tab), and more than half of all VC money deployed this year flowed into AI startups (opens in new tab).
The amount of office space leased to AI companies continued to increase in 2025, a trend experts expect to continue. JLL research analyst Chris Pham predicts that AI startups will continue to emerge and grow in the city, and firms based elsewhere will decide to move to San Francisco to take advantage of the talent and VC funding.
“There’s increased positivity around San Francisco, so outside tech firms are looking to sign here,” said Pham. “The conditions are better, and they’re also attracted by all the AI talent that’s here in the city.”
In 2025, JLL recorded 133 leases by AI companies, 85 of which were early-stage startups. That compares to 104 leases in 2024, of which 66 were from companies between their seed and Series A rounds of funding.
Our take: The verdict’s still out. San Francisco continues to be a hotbed for AI, but the white-collar job drain doesn’t appear to have ended. Will the AI bubble burst this year? If so, there’s significant pain on the horizon.
Retail
Good news for San Francisco’s retail market: The vacancy rate decreased to 6.5% last year, down from its high of 7.2% in 2024.
An increase in sales and leases of retail space in 2025 contributed to the decline in empty storefronts. The number of square feet of retail space sold in 2025 increased by about 25% from the previous year, which could pave the way for adjusted leasing terms this year.
While parts of the city remain pockmarked by retail vacancies, even those areas have seen increased leasing momentum this year. “The biggest problem we had downtown was a PR problem,” said Kidder Mathews senior vice president Cameron Baird. “But there’s been a big change there with the new administration. Mayor Lurie has made it clear that SF is ‘open for business,’ and we’re starting to see those results.”
Meanwhile, other retail blocks have nearly no space left.
“Key commercial corridors like Hayes, Fillmore, Chestnut, and Jackson streets are essentially sold out,” said Maven partner Pam Mendelsohn, citing vacancy rates of 3%-4% in those areas.
Our take: The comeback is real, and the city’s retail outlook is looking brighter. The neighborhoods are hot, and Union Square is seeing “insane” tour activity. Now here’s hoping someone can solve the problem of that damn dead mall downtown.
Small-business success
The number of small businesses launching in San Francisco dropped significantly in the second half of the year, according to data from the treasurer and tax collector. While Lurie has continued to push for permit reforms (opens in new tab) to make it easier to launch and run a small business, entrepreneurs aren’t buying in yet.
It isn’t all bad news, though. San Francisco restaurants had a good year, according to reservation platform OpenTable. Dining reservations were up 20% from 2024 and up 24% from 2023.
Meanwhile, small businesses in San Francisco, Oakland, and Berkeley have collectively gotten stronger since 2024, according to the Fiserv Small Business Index (opens in new tab). The market index, which measures cash-register sales activity, increased nearly 6%, thanks in part to increased sales activity, according to Fiserv. That amounts to a 20% sales lift compared to the January 2019 baseline.
Our take: While there are indicators that existing small businesses had a good year, it’s a bad sign that fewer shops and restaurants launched in 2025.
Transit
It’s been a tough year for public transit. BART and Muni are dealing with a massive funding crisis. BART in particular suffered a handful of major outages last year, leading to service disruptions and smoky evacuations for freaked-out passengers.
While both services have seen ridership improve in the past year, the new realities of hybrid work mean they may never return to pre-pandemic numbers — forcing a structural reset in how they’re funded.
“Despite encouraging ridership gains, BART continues to face a $375 million budget deficit,” the agency wrote in a year-end report. (opens in new tab) “To close that gap solely with fare revenue, current ridership would need to more than double. BART’s most recent budget forecast projects a 4% ridership increase in 2026.”
Both ailing systems plan to ask voters to approve new taxes for funding come November. If those measures aren’t approved, routes will be cut and service could get more unreliable. In short, it’s a high-stakes year for the city’s trains, buses, and cable cars.
Our take: No comeback yet. While ridership continues to rise, it would take a miracle to get back to prepandemic levels this year. Instead, saving Muni and BART will require creative problem-solving and voters willing to shell out on increased taxes to keep them running.
Return to office
Office badge scans — a proxy for workers who show up in person — continued to hover at less than 50% of pre-pandemic levels in 2025, according to Kastle Systems.
However, not all neighborhoods are created equal. JLL crunched the numbers from another tracking company, Placer.AI (opens in new tab), which uses cellphone data, and found that two red-hot neighborhoods for office leasing — Mission Bay and Jackson Square — experienced a surge in workers this year.
Mission Bay’s employee foot traffic is up 110% from its pre-pandemic level, while Jackson Square traffic rose 68%, thanks to “AI and VC companies desiring to be in those areas,” according to JLL. Eateries in the area have benefitted accordingly.
While downtown’s employee foot traffic fell the most during the early years of the pandemic, the area continues to lead the nation in year-over-year increases in office visit trends, according to Placer.AI (opens in new tab).
“The city is now mounting one of the most robust recoveries,” a Placer.AI (opens in new tab) spokesperson said, attributing the growth, again, to the AI boom.
Meanwhile, a handful of major office buildings downtown are set to trade hands, which will reset rent pricing and amenities investments. That’s likely to lead to a surge in tenants — companies that will likely want their workers to use the new space.
Our take: The comeback is real. While San Francisco may not regain its pre-pandemic office attendance anytime soon (or ever), newer office hot spots are doing better than downtown. Plus, a reset in the Financial District could spur new leases and ramped up RTO pressure.
Commercial real estate
Last year, it finally became cool to bet on San Francisco real estate again, as institutional capital came flooding back, big buildings finally sold, and development plans started to take shape.
“In my opinion, 2025 will be looked back upon as the most important year in San Francisco’s office market recovery,” Kyle Kovac, executive vice president of CBRE’s Capital Markets team, told The Standard late last year.
Office vacancy is still sky-high, at 34.4%, according to Cushman & Wakefield, but more space was leased than vacated for the first time since 2019. Plus, the vacancy rate in Mission Bay, where OpenAI is headquartered, is below 9%. In the Presidio, which has become a hot spot for venture capital firms, the vacancy rate is less than 2%.
It seems like 2026 could be a banner year, but we’re still waiting for clearer signs of the long-promised “Great Reset.”
Our take: There’s optimism in the market, and some areas of the city are doing better than others. But until the vacancy rate starts plummeting, it’s hard to be too cheery about commercial real estate.
Residential real estate
San Francisco’s residential real estate market had a topsy-turvy 2025, as springtime tariffs and the resulting economic uncertainty froze what’s typically a hot time for home sales. However, deals came roaring back in the fall, with a handful of big-ticket sales in the second half of the year.
Experts predict that 2026 could be even crazier, given an explosion of new tech wealth expected to result from IPOs from the likes of Databricks and Anthropic.
The one bright side for anyone who doesn’t own their home is that the number of construction permits granted in 2025 is trending up, though it’s still below the pre-pandemic average of 332 authorized units in 2019.
Our take: The comeback is real. This year will likely be a good time to be a landlord or a home seller, but it could be increasingly frustrating for renters.
Crime
“Violent crime is down to lows not seen since the 1950s,” Lurie said at a December press conference. “Car break-ins are at 22-year lows, and citywide crime is down 30%.”
Our take: The comeback is real, and the city is safer than it’s been in decades. The numbers are so stark that even the haters will have to stop accusing San Francisco of lawlessness.