SAN FRANCISCO (KGO) — The old Rexall Drug Store on 9th and Irving Streets is a symbol of permanence in a forever-changing San Francisco.
“I think they all disappeared like 50 years ago,” remembers one old-timer.
Yet, this one remains.
Businesses here in the Inner Sunset District like to stay put, that’s if their landlord offers them stability by keeping rents reasonable.
“My rent hasn’t been raised since the pandemic,” said Alex Sinclair, owner of the Willow on the Green, a British fine foods and cheese store.
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His landlord lives in the neighborhood and that makes a difference.
“The people who are in the area, they keep their rents low enough that businesses can grow and survive. And people who are using this as investment with trusts and funds are seeing pre-pandemic numbers that they want to have, but they’re not getting anyone to be able to afford those rents,” Sinclair said.
Like this building in the neighborhood, which was previously leased to T-Mobile. The owner is asking $15,000 a month. No takers yet, even though San Francisco is trying to force landlords to fill store front spaces within six months or pay a hefty new tax.
And..how’s that going?
According to the Office of the Treasurer, 2,772 parcels are subject to the tax, and in the past two years, the city has been able to collect $3 million.
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Yet, on this block of Irving Street, there are no empty businesses.
A real estate agency has been here for five years. Manna, a Korean restaurant, 14 years. A hair salon, 21 years. And the Rexall Drug Store was just leased a week ago after the landlord agreed to significantly lower the rent.
Iqbal Gill is the new owner and pharmacist.
“I always wanted to have my own. I have been trying since 1995, but again, didn’t have much money to start my own, because you need money to survive for at least a year or so,” Gill said.
We caught up with his landlord, Adib Dudum, who owns 14 properties — every one of them, he says, is rented.
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“I have never had an empty store in the last 10 years. This is how I negotiate leases with the old tenants: make yourself happy. Give me a number, and if you are happy, I’m happy,” Dudum said.
Having owned for so long, his tax base is also relatively low, so he has some wiggle room.
But he understands that for a new tenant, starting a business could take months, sometimes more than a year.
According to an Aug. 2024 report issued by the San Francisco Planning and Urban Research Association, SPUR, “A new restaurant must go through 61 steps involving 11 local agencies to get its required permits and licenses. Just to get started, a restaurant may have to pay 17 different government fees, making it both a difficult and expensive process.”
“If you go to a small store, and you see like a liquor store or a grocery store, you’ll see maybe 15 to 20 permits just to operate,” Dudum said.
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He lived in the inner Sunset for 50 years. He understands that small business owners are subject to unpredictable circumstances, the highs and lows of the market.
For example, shortly after the pandemic, UCSF’s Parnassus campus began a massive renovation.
“A lot of their lunch time staff and researchers are out in Mission Bay and no longer in the Inner Sunset. We’re not seeing the tourists the way we would before. We used to see a lot of walk-throughs coming in from around the world, people visiting for the first time. We’re not seeing that,” Sinclair said.
Dudum is not his landlord, but many others in the inner sunset are following Dudum’s lead.
“We try to keep them happy, keep them afloat by not raising the rent,” Dudum said.
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