SFCED | San Francisco Center for Economic Development

High Rents Remain a Challenge for S.F. Small Businesses, Despite Increasing Optimism

An improving economy will trigger both hiring and capital spending among small business owners, who are at their most optimistic since 2008, but rising rents remain a top concern among those in San Francisco.

Retail rents in San Francisco’s prime shopping district has increased by more than 30 percent over the past year.

More small business owners anticipate higher revenues throughout the next 12 months, according to the latest Wells Fargo/Gallup Small Business Index. Owners are at their most optimistic point since the Great Recession, with the small business index score increasing to positive 58 – the highest it has been since 2008.

“As the economy improves and the unemployment rate drops, people have more money to spend,” said Regina Dick-Endrizzi, the executive director of San Francisco’s Office of Small Business. “In general, there is a lot of optimism among small businesses, and we see businesses on a daily basis that are wanting to open, having new and exciting ideas. The city is still a place where entrepreneurs with a lot of ingenuity find a great place to start their business.”

Small-business owners are more optimistic about their companies’ finances for 2015, with more than 70 percent expecting overall stability to be “very” or “somewhat” good over the next 12 months, up from 66 percent in the third quarter.

Read more: San Francisco Business Times (blog) High rents remain a challenge for S.F. small businesses, despite increasing