Kevin O’Leary, chairman of O’Leary Ventures and star of "Shark Tank," did not mince words when he recently criticized San Francisco for its spiraling economic conditions and high-profile store closures. O’Leary attributes the downturn to what he describes as the city’s "bad policies," which he claims have transformed it into a "wasteland."
During an interview with Fox Business, O’Leary expressed his frustration with the state of California, particularly targeting San Francisco. He stated, "This is not America anymore. This is a wasteland," lamenting the stark difference from what the city once represented.
Another office disaster strikes the San Francisco Bay Area
An Oakland office tower just traded hands at a massive 70% 'discount'
The lender was the highest bidder w/ a $4M credit bid in a foreclosure auction
The building was previously acquired for $13.3M in 2017
At… pic.twitter.com/j14Hd1NO9p
— Triple Net Investor (@TripleNetInvest) June 20, 2024
O’Leary's comments come in the wake of numerous retail giants such as Nordstrom and Whole Foods shuttering their stores in the downtown area. The closures are largely attributed to soaring crime rates, rampant homelessness, and an unfriendly business environment exacerbated by stringent regulations and high taxes.
The investor highlighted how the policies of California’s government, led by Governor Gavin Newsom, have been detrimental to small and large businesses alike. O’Leary criticized Newsom for what he perceives as gross mismanagement, noting, "He’s turning this state into a version of Venezuela". This statement reflects his broader concern about the economic trajectory of California, which he claims is driving capital and businesses to more competitive states like Texas and Florida.
SAN FRANCISCO PROBLEMS
Imagine you on the bus just trying to go about your day—and this mofo is right in the middle camped out in a fucking hammock.
You can’t win. Move now. San Francisco is a major disaster of apocalyptic times. pic.twitter.com/3tzhhWFIFV
— Sheronda Washington (@narcanmaker) May 13, 2024
O'Leary also pointed out the adverse impacts of the state’s recent minimum wage hike to $20 per hour for restaurants with more than 60 locations. He argued that this policy has led to increased menu prices, reduced consumer spending, and ultimately, the closure of numerous dining establishments. New data supports his claims, showing a significant drop in foot traffic to major chain restaurants since the wage hike took effect.
Adding to the economic woes, O'Leary noted the broader issues facing commercial real estate. He explained that many office buildings remain vacant as remote work becomes the norm, leading to a decline in property values and a potential crisis for regional banks heavily invested in commercial real estate.
In response to O’Leary’s harsh critique, Newsom’s office has defended their policies, citing data from the U.S. Bureau of Labor Statistics which indicates that California has added 4,500 jobs in the fast-food industry since the minimum wage increase. However, O'Leary remains unconvinced, urging a reevaluation of the state’s economic strategies.
O'Leary's remarks reflect a growing frustration among business leaders who believe that San Francisco’s current trajectory is unsustainable. As the city grapples with these challenges, the debate over the effectiveness of its policies continues to intensify, with significant implications for its future economic health.
