Downtown San Francisco is bracing for the loss of another longtime retailer on top of recent store closures at some of the city’s oldest tenants.
The Old Navy flagship store on Market Street will close on July 1, according to the parent company gap inc confirmed to CoStar News. That will see the San Francisco-based retailer retiring from downtown altogether after several decades of operating prime properties across all of its brands. The closure will create another high-profile retail space for san francisco as retailers and customers are concerned about crime, homelessness and low foot traffic.
The Old Navy outpost at 12 Fourth St., which opened in 1999, spans approximately 72,000 square feet. The three-story store is by far the retailer’s largest location. It’s nearly three times the size of a roughly 22,000-square-foot outpost in the Silicon Valley region, its second-largest store.
A spokesman for Gap Inc. attributed the deal to the company’s decision at the Old Navy site not to renew the lease, which expires in July, according to CoStar.
“Old Navy is constantly evaluating its real estate portfolio to ensure a healthy store fleet that can provide the best possible experience for our customers,” the company said in a statement, adding that it is “already working on opening new locations in downtown San Francisco.” to identify.” This better serves the needs of the business and our customers. Gap Inc. has deep roots in San Francisco and is committed to the city.”
Over the past two months, a number of big-name retailers, including Nordstrom, Saks Fifth Avenue, Anthropologie and Office Depot, have launched plans to permanently close hundreds of square feet of leased space in downtown San Francisco.
Since the pandemic began, retailers such as Uniqlo, Marshall’s, Amazon Go, Coco Republic, Williams Sonoma, Crate & Barrel, Target, Abercrombie & Fitch, The Container Store, CVS and Walgreens have closed locations in and around downtown San Francisco due to the conditional Shifts reduced foot traffic in the city and the surrounding office buildings remained mostly empty.
The shift to remote work and San Francisco’s reliance on a now-ailing tech sector has meant that the daytime population is lower and crime rates higher.
Gap Inc.’s Banana Republic recently opened its longtime flagship store at 256 Grant Ave. relocated to a much smaller room nearby. (CoStar)
According to CoStar data, downtown San Francisco’s retail vacancy rate has risen to over 18%, and subdued rental activity has not been enough to fill the gap. The lack of activity downtown has resulted in tax cuts, leading San Francisco officials to now expect the city budget to run a deficit of nearly $800 million.
For Gap, the closure of Old Navy joins other locations the company has closed due to significant cost-cutting efforts and a major reorganization. The company has struggled to recoup years of losses at its clothing brands, which include the namesake label Gap, Banana Republic, Old Navy and Athleta.
At the Westfield San Francisco Center, just blocks from its soon-to-be-closed Old Navy store, the retailer closed its Banana Republic location in April. The company also signed a lease to relocate its flagship store, Banana Republic 152 Geary St. in the Union Square district, where around 8,500 square meters are currently rented. It was previously in 256 Grant Ave. where the company had leased two floors covering more than 70,000 square feet for over a decade.
As of 2020, Gap has also closed its flagship location in downtown San Francisco, as well as additional outposts at the Stonestown Galleria and Embarcadero Center in San Francisco.
The retailer also closed a downtown location it leased for its athleisure brand Athleta earlier this year.
Gap recently reported a net loss of $18 million for the quarter ended April 29, a significant improvement from the $162 million the company lost in the same period last year. The company is also in the final stages of testing some outposts of Gap and Banana Republic as part of a project restructuring plan close 350 locations by 2023.
