| SFCED Attracts, Retains Business – and Tracks Wins As the San Francisco Center for Economic Development (SFCED) works every day to help attract and retain businesses for the city, it hears about -- and sometimes participates in -- economic news as it is happening. And recently a lot of that news has been very good: companies are moving into town, economic indicators are up, Mission Bay’s biotech dreams are poised to become a reality. These developments, and others, are reported below. Headquarters Wins: Riverdeep, Olivia Travel, Primitive Logic Move to San Francisco, Add 340 Jobs As San Francisco adds to its growing list of recent headquarters (HQ) job wins, its cache as a premier business address continues. When the SFCED goes out to make its pitch to still more companies to locate here, recent successes help us demonstrate San Francisco’s attractiveness. “As their leases expire elsewhere, companies are continuing to seize the advantage of competitive lease rates to make the move to San Francisco,” says Dennis Conaghan, SFCED executive director; “and we are thereby steadily recouping losses from the bust that followed the internet bubble of the late 90’s.” The following firms moved to the city within recent months: Olivia, a travel service catering to gay and lesbian clientele, decided to relocate to San Francisco from Oakland with 125 employees. Primitive Logic, a privately held financial, health care, and life sciences consulting company moved 110 jobs to San Francisco from a Marin location. Riverdeep, an Ireland-based educational software company with operations in Novato, had looked at New York City as a location for its US HQ. But the company decided to bring its 105 jobs to San Francisco instead. Real estate broker Peter Pomeroy of Colliers International negotiated a deal that Riverdeep found attractive, and his efforts were supported by concerted outreach from the SFCED. These firms have joined an impressive group of other new entrants or returnees that includes Gymboree, The Body Shop, MediaLive International, and several others. Signs of Economic Rebound: Unemployment and Office Vacancy Rates Down According to two important indicators, San Francisco job growth should be picking up its pace. Over the past year, from August ’03 to August ’04, San Francisco’s unemployment rate decreased from 7.0% to 5.6%. During the same period, the State of California’s unemployment rate fell from 6.7% to 5.7%, thus ending the first period recorded in decades when San Francisco’s unemployment rate was higher than that of the state as a whole. Central business district office vacancy rates are also moving down – further indicating that companies have started to hire more workers or anticipate doing so fairly soon. Office vacancies have decreased from last year’s peak of 20.7% to 17.9% in the latest quarter (source: BT Commercial). “We continue to see the gradual, but sustained, progress back to the job growth and economic health that we had predicted for the coming quarters,” says Conaghan. Further Signs of Economic Rebound: Tourism Up In a sign that tourism is returning steadily, hotel occupancy rates, room rates, and SFO traffic are all up, according to recent reports. Hotel occupancy went from 65% for the first seven months of 2003 to 72.1% for the same period this year. Average daily hotel room rates clicked up from $141.91 to $144.21 during this period. And passenger traffic at SFO has increased by a full 20% over last year. See the San Francisco Chronicle’s article on the subject.Bioscience: The Dream Becoming Real at Mission Bay What a difference a year (and some) makes. On Friday, June 13, 2003, the San Francisco Chronicle ran an article titled “Mission Bay biotech dreams fade”. The article discussed the depressed biotech sector and Mission Bay’s difficulties attracting private bioscience companies. Now the picture is changing decisively for the better and the dreams are becoming real. The city has been racking up some important biotech victories – and more are expected in the near future. To name a few: Alexandria’s Land Purchase and Big Vote of Confidence - Alexandria Real Estate Equities Inc. of Pasadena acquired six parcels of Mission Bay land, totaling more than 500,000 square feet, for development (as reported in the San Francisco Chronicle). Alexandria is the nation’s largest real estate investment trust (REIT) dedicated to biotech. The REIT’s acquisition of land at Mission Bay is an important vote of confidence. As quoted in the Chronicle, Alexandria CEO Jeff Marcus indicated that the company is looking forward to helping build “a major cluster for scientific research, development, and translational medicine.” National Science Foundation’s $1 million Grant to SFWorks and City College of San Francisco for Biosciences Training - To help train low income workers for careers in biotechnology (as reported in the San Francisco Chronicle), Chamber affiliate and SFCED sister organization San Francisco Works as well the City College of San Francisco received two grants totaling more than $1 million to extend their successful On-Ramp to Biotech and Bridge to Biotech programs. These programs are directed to training low-income residents from such neighborhoods as Bayview-Hunter’s Point and Mission District for entry into biotech jobs. As this industry grows, its benefits will flow to all. Business Attraction: Mayor Names High-Level Biotech Advisory Committee - In order to help him pitch the city as a good location for the biotech industry, Mayor Gavin Newsom has named a Biotech Advisory Committee consisting of several industry luminaries. Steve Burrill of Burrill & Co will chair the committee, which will include venture capitalist Brooke Byers, Genentech president of product development Susan Desmond-Hellman, David Goeddel, head of Amgen’s San Francisco research operations, and others. Business Attractor: Board of Supervisors Passes Payroll Tax Exclusion for Bioscience - Based on observations by the SFCED, the Mayor’s Office of Economic and Workforce Development, and various brokers, there has been a noticeable increase in numbers of biotech companies inquiring about San Francisco as a location. The reasons for the increase? Among others, companies have cited the Biotech Payroll Tax Exclusion legislation sponsored by Supervisor Michela Alioto-Pier and passed by the Board of Supervisors during the summer. While building up the city’s base of bioscience companies will take several years, this is a good initial sign that the vision is becoming a reality. Bay Area Conference on Homeland Security The Bay Area
Economic Forum and Bay Area Science and Innovation Consortium are
hosting the Second Bay Area Conference on Homeland security, Tuesday,
October 5, 7:30 am-3:45 pm, at the Oakland Marriott City Center
Hotel in Oakland. The conference has an outstanding list of speakers
from federal and state government, the emergency services community,
national laboratories and the private sector. Keynote speakers include
Suzanne Mencer, executive director/State and Local Government Coordination
& Preparedness, Department of Homeland Security; General Robert
Ostenberg, commanding general of the 63rd Readiness Command of the
U.S. Army Reserve; and Michael Morehart, FBI section chief/Division
of Counter-Terrorism. For more information
on the SFCED or any of the items mentioned above, please contact
Todd Ewing, managing director at tewing@sfced.org.
Visit the SFCED website at www.sfced.org.
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