That AI-run retail store experiment in Cow Hollow may or may not be going well, depending on who you ask. But it's gotten plenty of media attention, and perhaps that is mostly what the company behind it was after.

SF-based Andon Labs, which had already launched a series of allegedly successful AI-run vending machines, decided to "scale up," they say, and put an AI agent in charge of an entire physical retail store. It's called Andon Market, they signed a three-year lease for a shop in Cow Hollow, and it appears they didn't give the AI agent, named Luna, much direction besides that it should turn a profit.

There isn't any profit yet, but that's to be expected in a store's first months. It's the choices that the agent has been making that are laughably strange, and perhaps not driven by profit motive so much as confusion about what a store is? And beyond the ethical issues around an AI entity hiring and managing human beings, what about the creative choices that a store owner makes, which, presumably, AI still isn't capable of grasping?

What is the purpose or vision behind this store anyway? It's fairly clear to the casual retail observer that it does not have one, and the product array is fairly bizarre in addition to being boring, and the most likely sources of revenue here are going to be AI-obsessed tourists to San Francisco who stop by to document the store and the phone you can talk to Luna on in an Instagram story, and maybe buy a mug or t-shirt with the AI-designed Andon Market logo as a keepsake. (The logo, too, is pretty unimaginative and generic — it's a smiley face. And the mugs are priced at $28 apiece.)

None of the products have price tags, by the way, and the employees apparently aren't told what everything costs. Customers have to speak to Luna on a telephone handset by the iPad checkout system to find out what the price of something is, and she'll say, "Nice choice! That’s $14!" possibly picking prices out of thin air.

Heather Knight, writing for the New York Times this week, has checked out Andon Market and has a few funny tidbits to share. First of all, Luna "has struggled with employee schedules and cannot stop ordering candles." And in addition to candles, the store's product array — displayed on Metro shelving and a central table — includes mini chess sets, "granola bars, jars of honey and a random collection of books," per the Times.

And Luna, amusingly, ordered 1,000 toilet-seat covers for the bathroom, and then mistook them for product inventory and listed them for sale.

The (very European) founders of Andon Labs say in the video below that they are curious about the ethical implications of an AI-run store, and seeing how this experiment plays out. ("We're not doing this to prove that AIs should run stores," says one of Andon Labs' founders. "We're doing it to find out if they can.")

One obvious issue: Knight points out that the two female employees Luna hired are being paid two dollars less per hour than the one male employee, Felix. Luna says this was because Felix had more retail experience.

And, yes, the only customers Knight documents at the store are a tourist couple from Sydney, Australia, who used AI to plan their vacation, and were planning to take a Waymo ride that day to round out their AI experience.

As for how this goes as the store continues to operate, we'll have to see. Andon Labs says that the three employees who were hired for the store by Luna will, ultimately, answer to human beings in the end.

"This is a controlled experiment and everyone working at Andon Market is formally employed by Andon Labs, with guaranteed pay, fair wages, and full legal protections," the company says in a blog post. "No one’s livelihood depends on an AI’s judgment alone."

So, what about that hourly wage discrepancy?

Previously: New Boutique in SF’s Cow Hollow Is Completely Run by AI, Which Manages Human Staff

A local startup that tests AI agents in real-world applications assigned an agent to create, stock, and staff a brick-and-mortar store in SF’s Cow Hollow on its own for under $100,000. While it got the business up and running for opening day, it forgot to schedule staff.  

The startup, called Andon Labs, signed a three-year lease at Union and Webster streets in San Francisco and told the AI agent to create a physical retail store using its corporate credit card, as Business Insider reports. The only parameters were to spend less than $100,000 while turning a profit, although the lab’s cofounders, Lukas Petersson and Axel Backlund, said they don’t expect the business to be lucrative.

The AI agent, called “Luna,” was developed using Anthropic's Claude Sonnet 4.6 to help detect errors that agents encounter while operating tasks in the real world. Luna reportedly made nearly all the decisions surrounding planning and stocking the store, which it called “Andon Market,” including the logo, interior design, merchandising, and hiring human employees. The concept for the store appears to be a basic boutique selling items such as books, candles, games, art prints, home goods, and branded merchandise.

"We helped her a bit in the initial setup, like signing the lease. And legal matters like permits and stuff, she sometimes struggled with," Petersson told Business Insider.

The agent reportedly struggled to replicate its logo each time it was used, which consists of a basic smiley face, and while it successfully hired two human employees, it neglected to inform them up front in the interviews that an AI agent would be their sole boss. The agent also reportedly forgot to schedule a human worker for the store’s opening day over the weekend but managed to contact its new employees and got one of them to come in at the last minute.

While the employees are managed by the agent, the startup told Business Insider that they’re employed and paid by Andon Labs, and the company will step in when needed.

“This is a controlled experiment, and everyone working at Andon Market is formally employed by Andon Labs, with guaranteed pay, fair wages, and full legal protections,” the startup said. “No one's livelihood depends on an AI's judgment alone.”

NBC Bay Area reporter Scott Budman spoke to one of the store’s human employees, Felix Johnson, last week.

“Luna put out an ad on Indeed, and I answered it and we talked via Zoom,” Johnson said. He said he asked the agent if he would ever be speaking to a human during the interview process, and it replied no.

The AI agent also handles the purchases, as customers are instructed to call the agent from a store iPad to complete the transaction.

Budman jokes toward the end of NBC Bay Area’s segment that customers will “no longer have to deal with Felix.”

“No offense, Felix,” he says, the line landing like a lead balloon.

Image: Google Maps

San Francisco's downtown mall may be dead, and Union Square may remain beleaguered and full of vacant storefronts, but that seems poised to change in the not-too-distant future.

Several well known retailers have reportedly been on the hunt for new space in and around Union Square, as the SF Business Times has it via real estate sources. Those include Nordstrom, whose closure announcement at the former Westfield Mall started all the dominoes falling for that property, which officially shut all the lights off in February.

Nordstrom, which had a 35-year presence in that Market Street mall, may have its sights on the former Saks Fifth Avenue location at Powell and Post streets, which was abandoned by Saks last year. Last fall, Nordstrom revived its San Francisco presence via a small boutique on Fillmore Street in Pacific Heights, which is mainly just a customer-service counter taking returns, offering order pickups, and clothing alterations.

Also potentially seeking new space that's not in a mall is Bloomingdale's, according to the Business Times.

A representative for Bloomingdale's would not confirm that they have any specific plans to move back to Union Square, but they said, "San Francisco remains an important market for Bloomingdale’s, and we continually evaluate opportunities that support our long-term growth strategy."

Nationally, Bloomingdale's has been faring better on a store by store basis than parent brand Macy's. And it remains unclear what will be the fate of Macy's flagship store on Union Square — we learned in November that the company had partnered with local developer TMG Partners to explore the future development of the 600,000-square-foot store property, which could include some continued presence for the store.

And, somewhat suprisingly, Barnes & Noble has reportedly been sniffing around Union Square for new space as well. While the bookstore chain has mostly been known for closing locations around the country in the last decade, they appear to be in some sort of expansion phase again. A new Barnes & Noble is coming to a former Party City space in Cupertino this fall, as we learned last week, and the company still has almost a dozen stores around the Bay Area, including in malls in Emeryville and Corte Madera.

The last SF location of Barnes & Noble, at Fisherman's Wharf, closed in 2010. And they are closing their location at San Bruno's Tanforan Mall next month, per the Business Times.

In other Union Square retail news, Chanel will be opening a new multi-level store in the former Williams-Sonoma this year, Zara has a new flagship opening across the street from the former Saks, John Varvatos and Bang & Olufsen are both returning to the neighborhood, and Super Duper will be opening a burger outpost in the middle of Union Square Park. And down on Market Street, the massive former Old Navy will be coming alive again as Uniqlo returns to the area as well, later this year.

In what surely seems like a win for downtown and for Mayor Daniel Lurie, regardless of whether he had a hand in it, Macy's has confirmed that it will not be closing its Union Square flagship store anytime soon, and will instead work with a developer to reimagine the property.

The announcement arrived Tuesday morning, as the Chronicle was first to report: Macy's is partnering with developer TMG Partners for the future development of its 600,000-square-foot store property, which spans most of the block on the southern side of Union Square Park between Geary and O'Farrell streets. TMG, and its CEO Michael Covarrubias, say they are "wildly excited" to begin work on reimagining the massive property alongside Macy's.

Covarrubias tells the Chronicle that they are still discussing the "right choice of uses" for the future development, and that they see great potential "for that building, in that place, at this time."

TMG is also involved with the renovation at 149 New Montgomery Street, the former Yelp headquarters, and the firm is in contract to purchase the Metreon complex, with plans to reimagine that as well.

This is good news for Union Square as a whole, as it struggles to fill a large number of vacancies — and as retailers are likely wary of filling those empty spaces on Powell and Stockton streets not knowing whether anchor store Macy's might close up shop within months.

Macy's announced in February 2024 that it had plans to abandon Union Square, as part of a larger sell-off of store properties nationwide. But the company said its store would not close until it found a buyer for the property.

Today's announcement makes it sounds like Macy's will remain in place for an extended period as the development plans take shape, and/or it sounds like a Macy's store could still have a place in the future redevelopment of the property.

This could still bring some disruption to the Union Square area, but there has been talk of building housing there going back at least five years. In early 2020, Sand Hill Property Co proposed turning the former I Magnin property at Geary and Stockton — which is connected to the Macy's property — into a mixed-use tower with 21 luxury condos in the mix.

In 2023, the SF Board of Supervisors loosened zoning restrictions around downtown and Union Square, allowing for offices on upper stories on parcels previously zoned as "retail only."

The decline of large-scale department-store retail in downtown areas is something being felt in cities across the country, and the announcement of the possible closure of the Union Square Macy's store came with the announcement that the chain would close 150 under-performing stores by 2026.

Macy's previously closed and sold off its former men's store on Stockton Street in 2016, and that has since been redeveloped as office space, with the Japanese-Peruvian restaurant Chotto Matte on its top level.

In other positive news for Union Sqare, Japanese retailer Uniqlo has plans to revive the former Old Navy store on Market Street, and other retailers like John Varvatos are returning to the area as well after previously closing stores. And the city and the Union Square Alliance are moving forward with a plan to revamp the lower three blocks of Powell Street, adding new lighting, pavers, and wider sidewalks, in an effort to attract retail back to the street.

Previously: Retail Experts Weigh In On Macy's Union Square Closure, Saying Downtown Shopping May Be a Thing of the Past

As retailers flee the dying, anchorless SF Centre mall, it looks like it could be Union Square's gain.

Without Nordstrom or Bloomingdale's there, and absent a deal to bring in another anchor tenant to fill the vast, empty retail spaces in the SF Centre mall, it seems like the exodus of other retailers from the mall will only continue. And that may spell good news for Union Square, which still has a bunch of prominent vacant retail spaces to fill after an exodus that occurred there five and six years ago.

The Chronicle reports today on what could be a trend, with high-end menswear brand John Varvatos inking a deal to return to Geary Street, seven years after it left and opened a store in the mall instead. John Varvatos has leased the former Alexander McQueen store at 58 Geary Street, just a block up from its former digs at 152 Geary, which it abandoned in 2018.

A rep for the Varvatos brand tells the Chronicle, "Coming back to Geary Street feels important for the brand and exciting for the team."

Other retailers like Zara and Shoe Palace, which have had a presence in the SF Centre mall for years, now have set their sights on Union Square — and the future of their duplicate mall locations is unknown. Zara just announced plans to open a huge, new four-story flagship store at Post and Powell next year, moving up the street from its current location, which could end up making the mall location redundant. (In the past, retail brokers tell the Chronicle, this kind of duplication was common because the stores appealed to different demographics, just like Tiffany's formerly had a mall location selling lower-priced jewelry than their Union Square store.)

And H&M's decision to close their big Powell Street store mid-pandemic while maintaining their presence at the SF Centre now looks a little misguided. The company also has a location at Stonestown Galleria — which by comparison has been thriving the last several years and has become more of an Asian American mall both in its food and retail offerings.

Could H&M be the next brand to make a comeback in Union Square?

There is still a lot of vacancy on Powell Street and elsewhere around the square, but that could change quickly.

"J. Crew should be here. Coach should be here. Hugo Boss should be here. Now is the time because pretty soon those spaces will fill up," says Union Square Alliance CEO Marisa Rodriguez, speaking optimistically to the Chronicle.

But she could be right. If what retail employees were saying in recent weeks is true, about how decimated the foot traffic at the mall has been, brands could be looking to make a fast exit to street level, where foot traffic seems to be rebounding.

The only wild card still in the mix is the future of Macy's, which essentially serves as an anchor for the Union Square shopping district and has for almost 80 years. Macy's announced its intent to close this 400,000-square-foot store in February 2024, saying that it was looking to offload the building from its real estate portfolio. There have been rumors of interested buyers, but none has emerged with any for-certain deals so far, and we don't know what sort of background begging and pleading has been going from the city.

Also, with Neiman-Marcus having been acquired last year by the parent company of Saks Fifth Avenue, the Hudson Bay Company, and the Union Square Saks store still hobbling along with a skeleton staff and an appointment-only model, the future of that Saks location looks far from certain.

Nevertheless, Shoe Palace and Zara appear to be betting that the long-term health of the shopping district is secure, and others may follow.

Fast fashion retailer Zara is planning to relocate a block away from its existing location in Union Square and open a huge new flagship store at the corner of Post and Powell.

The positive news items have generally been fewer than the negative ones in the past two years when it comes to Union Square retail. But SF Mayor Daniel Lurie was quick to celebrate the news Monday that Zara is taking over the prominent empty space at 400 Post Street, at Powell, across from Saks and the Westin St. Francis.

"This is what we're talking about," Lurie said in a video posted to Xitter. "We are seeing the momentum build every single day."

As the Chronicle first reported, this will be a significant expansion of Zara's footprint in Union Square, with a four-story, 40,000-square-foot flagship store that is almost double the size of its existing store at 250 Post Street.

In a statement, Lurie told the Chronicle that this was a sign that "global brands want to grow here," and Zara's decision was "the latest vote of confidence in the future of our city."

Zara had announced, a little over a year ago, that it would be closing its Union Square store when its lease expired in January 2025. That may have been a negotiating play over that lease, which seems to have been extended, but the company decided to take a new lease up the street instead. The new store is expected to open next year.

There have been hopes that something similar could happen with Macy's, which announced its intent to close its Union Square flagship store over a year ago, once it sells the property. There have been no updates on that sale, however the Mayor's Office is no doubt continuing to try to get the company to stick around in some shape or form, just Mayor London Breed and former Supervisor Aaron Peskin were doing last year.

Last month, the Bloomingdale's store in the nearby SF Centre mall closed its doors, and last week we learned of nine more stores in that mall that were recently closed or closing. A foreclosure auction for the mall property has been delayed four times, and is now scheduled for June.

In other opening news around Union Square, Shoe Palace debuted in February in the former Express store space at Geary and Powell, and a Nintendo Store is opening at 331 Powell Street on May 15.

Saks Fifth Avenue, which already switched to an appointment-only model at its Union Square store and laid off some employees, may not be sticking around much longer in SF, real estate experts surmise.

The parent company of Saks, the Hudson Bay Company (HBC), just completed a deal late last year merging Saks Fifth Avenue with two other luxury retail brands, Neiman Marcus and Bergdorf Goodman. And while Fortune reports this deal is likely, in the eyes of Neiman's and Bergdorf's customers, to negatively impact the integrity of those brands, it's also going to have ripple effects on the larger company's real estate holdings.

As the Chronicle reports, the prominent Neiman Marcus store at 150 Stockton Street quietly changed hands as part of the merger in December, becoming part of the Saks Global Enterprises LLC portfolio. And with the Saks store diagonally across Union Square already seeming on life support, given the appointment-only thing, retail real estate experts say it may not be long for this world, especially with the company's lease expiring at 384 Post Street in 2027.

When reached for comment, Saks Global told the Chronicle, "We continue to serve our San Francisco customers at our Saks Fifth Avenue and Neiman Marcus stores, and have nothing more to share at this time."

With Bloomingdale's slated to close later this month, the departure of Saks would leave Neiman Marcus as the last remaining luxury department store in Union Square. And with Macy's slated to close after the company succeeds in selling its massive property on the square, Neiman Marcus would be the only department store in the area, full stop.

It's a stark and fairly sad picture for SF retail overall. Just three years ago, the Union Square area had five of these large-scale stores, if you count Bloomingdale's and Nordstrom in the SF Centre (formerly Westfield) mall, and soon it could be down to one, with none offering the kinds of sales and occasional bargains of a Macy's.

Stores like these are known as anchor tenants in malls, and serve the same purpose in a shopping area like Union Square, but the ways Americans shop may just have fundamentally changed — and the department store model seems to be struggling.

No deal has yet occurred for the acquisition of the SF Centre property, which entered receivership two years ago after the departure of the Westfield Corporation, which surrendered the mall to its lender. An auction for the property, originally scheduled for November, has been postponed several times, and is currently set to take place on March 27, as the Chronicle reported last month.

This is not news that anyone wanted to hear today about San Francisco and its downtown recovery efforts, but following in the footsteps of major retailers Nordstrom and Macy's, Bloomingdale's is shuttering its massive SF store.

Bloomingdale's announced Tuesday that it will close its flagship San Francisco store at the SF Centre mall as of "late spring," or the end of March — a statement from the company says the former, but the Chronicle is reporting the latter, which would be early spring.

The store, which has certainly felt under-trafficked in recent years much like its sibling Macy's at Union Square, occupies the other anchor space at the SF Centre that has been a vague glimmer of hope for the mall, after the closing of anchor tenant Nordstrom in 2023.

This leaves the mall, which continues to be in receivership after the departure of former owners the Westfield Corporation in 2023, in even worse shape when it comes to turnaround efforts.

Multiple smaller but prominent retailers have shuttered their spaces in the mall in the last two years, including J. Crew, Hollister, Adidas, and the Lego Store, and the Michael Kors store, which occupies a space facing Market Street, announced its closure last week.

While the court-appointed receiver has filled some of unoccupied spaces, several sections of the mall, including all of the fourth floor that was once home to "The Restaurant Collection," have lain sadly vacant for a number of years now.

"We are saddened to confirm that Bloomingdale’s will officially close its doors in Union Square, San Francisco," the company said in a statement. "While we are committed to this decision, Bloomingdale’s doors will remain open until late spring 2025.  We are hopeful to be back to serve the San Francisco community in the future and look forward to introducing new ways to provide enhanced service to our loyal local shoppers."

Macy's, which owns Bloomingdale's, has been downsizing in recent years and has plans to close its Union Square flagship once it sells the property. Macy's is also closing stores in San Mateo, Corte Madera, and Newark.

But according to the company, the Bloomingdale's brand, as well as its cosmetics chain Bluemercury, were still doing well in the struggling brick-and-mortar retail marketplace, while the Macy's brand is flagging. This led to speculation that the company could relocate Bloomingdale's from the SF Centre to the Union Square building — though they reportedly still had a decade left on their lease at the SF Centre.

A veteran retail real estate broker, Kazuko Morgan, calls the news of the closure "more heartbreaking than Macy's," speaking to the Chronicle. Morgan says that retail overall has been "on a good momentum," but this is no doubt a big blow.

Stay tuned for some sort of statement from Mayor Daniel Lurie, who like Mayor Breed before him with the Macy's news, was likely blindsided by this — and this won't be an easy or quick problem to fix.

The Macy's corporation hasn't shared much in the way of plans since its bombshell announcement earlier this year that it would close its flasghip San Francisco store. But there are a couple of possibilities emerging for the property.

Macy's delivered a blow back in February to the city's efforts to revitalize its beleaguered Union Square, announcing a likely closure in 2025 and a general plan to sell the 400,000-square-foot property along with around 150 other "underperforming" stores around the country.

Mayor London Breed, whose problem this will no longer be in a couple short months, tried to cast doubt on the certainty of Macy's plans, but many retail experts have noted that enormous, downtown department stores aren't exactly thriving anywhere.

Now, as the Chronicle reports, we have word that the brokerage and investment bank hired to handle the marketing and sale of the Macy's property, Eastdil Secured, has heard from several interested buyers of the multi-building complex, at least two of whom are local developers.

One is the Prado Group, which has an ongoing, large-scale residential development at UCSF's former Laurel Heights campus in the works, as well as another on the former California Pacific Medical Center campus at 3700 California Street. The two projects together comprise 1,320 residential units.

The other confirmed interested developer is TMG Partners, which owns PG&E's new Lake Merritt headquarters in Oakland — which it stands to make a 100% profit on when a sale to PG&E goes through next year. (TMG bought the building from Kaiser in 2020 for $450 million, and PG&E looks to be paying around $900 million for it.) TMG also owns a building at 600 Battery that it renovated into Class-A office space and leased to Ripple Labs in 2022.

A new use for the Macy's property would likely include some retail, however it could end up being primarily converted into other uses, which could include offices, a hotel, and/or residential units. According to planning, the property is in a highly flexible zone that could include any number of commercial, arts, or residential uses. But building up much higher than what's already there would incur a shadow study, and would likely cast significant shadows on Union Square Park.

Neither developer has made their intentions known, and both say they are in early talks for the property, per the Chronicle.

The city continues to express hope that Macy's, after selling the property, might still want to keep a store footprint there — or, perhaps, relocate its Bloomingdale's store from the SF Centre mall two blocks away, with Bloomingdale's reportedly being a stronger business these days.

As Sarah Dennis Phillips, executive director of the Mayor's Office of Economic and Workforce Development, told the Chronicle earlier, the city's "second best option" for the property "would be to ensure that some other type of significant retail presence is maintained at Macy’s Union Square flagship store, prior to and continuing through any redevelopment or change in ownership, including food and beverage uses along with substantial anchor retail."

Being the anchor store of the neighborhood at large, the impending departure of Macy's has no doubt made it harder for other property owners to lease out other vacant spaces, including a row of stores on Powell Street. Spaces like the Gap's former flagship at Powell and Market, and the enormous former H&M location on Powell have now sat vacant since the early pandemic or before, and retailers may be skittish about the neighborhood without an anchor like Macy's.

Reports of crimes like smash-and-grab burglaries, and the late August shooting of 49er Ricky Pearsall, have not helped the area's image.

Stay tuned, likely after the holidays, to hear what comes next for the Macy's property.

Previously: Can Daniel Lurie Save Macy's?

There's some good news on the retail front for San Francisco, with the Union Square-adjacent Emporium Centre San Francisco having signed seven new leases in recent weeks to fill some of the abundant vacancy in the troubled mall.

Still in receivership and seeking a buyer, the 1.5 million-square-foot Market Street mall formerly known as the Westfield San Francisco Centre has recently shown some signs of renewed life. A rebranding took place in March, nine months after the departure of previous owner the Westfield Corporation — and that's when we got the name Emporium San Francisco Centre, a nod to the property's long-ago department store, The Emporium.

In April, the Chronicle noted that three empty spaces in the mall had "leased" signs on them, and today the Chronicle reports from the leasing team that five of the formerly empty retail spaces have signed leases, in addition to two segments of the upstairs office space in the building.

Three new tenants that are already open for business in the mall are A&S Cell Accessories and Repairs, Hey Hi Toys, and Paw Box, which is some sort of vending machine operation for pet treats.

Hey Hi Toys — which mentions selling Hello Kitty and Mario toys and says "From cuddly companions to thrilling electric toys, we’ve got something for every adventurer" — may be a sign that the Emporium's agents are leaning into the trendiness of Japanese products and retailers. Both the Stonestown Galleria and the Japantown Mall having found recent success catering to teens with Japanese and other Asian retailers, and arcade games like claw machines.

Two other retailers are reportedly opening in July at the mall: +Friends, a vintage retailer; and another Japanese retailer, Merkado.

On the office side, the Chronicle reports that the nonprofit career exploration and workforce development organization Opportunities for All has leased 17,000 square feet on the fourth floor. And Block by Block, a company that provides cleaning, landscaping, and security services to community benefit and business improvement districts, including the Union Square BID and the Yerba Buena CBD, has leased space in the building as well.

This still leaves the enormous spaces vacant that were left by the departures of Nordstrom and Cinemark last summer. And last month we learned that the Market Street-facing American Eagle Outfitters would be closing in July.

Other vacancies were earlier left by the closures of Sephora, J. Crew, Hollister, Lucky Brand, The LEGO Store, Adidas, Burberry, and L'Occitane.

Up the street, IKEA's shopping center subsidiary, Ingka Centres, is trying to reimagine an urban mall with Meeting Place — at least that what it has been called in press materials. So far, it consists of an urban-sized IKEA store, and Saluhall, their reimagined two-level food court. Also, the top floor of the building is occupied by Hej! Workshop, a co-working space that doubles as a showroom for IKEA's office furniture.

It's not clear how popular Saluhall or the co-working space have been to date, and the company still has a fair bit of space to fill in the building. Ingka Centres has previously indicated it would be leaning in to more food- and entertainment-based retail.

Sarah Dennis-Phillips, director of SF's Office of Economic and Workforce Development, tells the Chronicle that the city has been working with the Emporium Centre to market to small businesses with limited budgets, implying that they may be getting discounts — in an arguably similar fashion to how the Vacant to Vibrant program is helping to get local small businesses into empty spaces further downtown.

"For too long, many small business owners were priced out of downtown spaces," Dennis-Phillips says in a statement to the Chronicle. "San Francisco Centre’s coordination with the Office of Small Business is part of its re-envisioning of the iconic mall as a place for small businesses to get a foothold and to flourish."

The fourth floor of the mall remains a kind of ghostly shadow of its former self — since it was once home to a collection of higher-end restaurants like Lark Creek Steak and MY China in addition to the movie theater. Those restaurants closed either pre- or mid-pandemic, and have not reopened, while the tidal wave of closures in the mall mostly took place in 2023.

Mario, Luigi, and Pokémon are swooping in to hopefully save San Francisco’s Union Square, as the video game giant Nintendo just announced they’re taking over one of the many vacant retail spots in the beleaguered shopping district sometime in 2025.

SFist noted in our coverage of last weekend’s Bay to Breakers race that there was a disproportionate number of Super Mario and Nintendo-themed costumes, which has been the case for years. But Party City may soon face some stiff competition for where these Nintendo fans are buying their Mario and Pokémon costume merchandise.

The Chronicle reports that the video game company’s US division, Nintendo of America, just announced Friday morning that they’re opening a Nintendo merchandise store in Union Square, which would be only the second Nintendo store in the US.

The announcement from Nintendo, seen above, is brief but still exciting. “Nintendo of America today announced plans to open an official store in San Francisco’s iconic Union Square, providing a way for a wide range of visitors from near and far to experience the world of Nintendo, its products, and characters,” it says. “The store, called Nintendo SAN FRANCISCO, will open in 2025 as the second official location in the US, joining the store in New York City.”

Mayor London Breed was quick to jump on and celebrate the news.

“@NintendoAmerica just announced they are opening a second store in the U.S. — right here in the ❤️ of San Francisco,” Breed said on Xitter just before 8 am Friday. “This is great news for Union Square and fans from everywhere! We’re excited  for San Francisco’s future and look forward to welcoming this iconic brand to our City.”

Of course, what’s lacking in these announcements is where the store will be located, other than the broad description that it will be in “San Francisco’s iconic Union Square.” But it’s no secret that Union Square has record retail vacancies at the moment, with an April report from Cushman & Wakefield noting that 20.6% of Union Square retail spaces are currently vacant.

As noted, there is only one other Nintendo store in the US. These Yelp pictures give you a sense of what that store is like, with plush dolls, action figures, t-shirts and merchandise related to Nintendo’s pantheon of video game characters, plus copies of the games, consoles, and a giant screen for people to play Nintendo games on.

Related: Pokémon Go Creating Security Nightmare For IT People [SFist]

Image: David G. via Yelp

The Emporium Centre San Francisco, formerly known as the Westfield San Francisco Centre, continues on the vacancy train with the announcement of the July closure of American Eagle Outfitters, one of the larger remaining stores in the mall.

American Eagle's parent company filed suit against the mall's former owner-operator, Westfield, citing "full neglect" of the property in the wake of the pandemic. The lawsuit said Westfield had allowed the mall to "deteriorate into disarray" by cutting back security before it surrendered the property to its lender last summer. "Westfield cannot walk away from the harm that it has caused without consequence," the company's lawsuit said.

The lawsuit alleged that the store had seen over 100 separate security incidents between May 2020 and May 2023, with some involving armed suspects brandishing weapons and threatening store employees.

Now, four years ahead of its lease expiration, American Eagle Outfitters is closing its store effective July 12. As the Chronicle reports, this will result in 52 lost jobs, and create another major vacancy next to the street-level entrance at Fifth and Market streets, on the (former) Nordstrom side.

American Eagle still maintains stores in San Mateo, Concord, Livermore, and Pleasanton.

The steady parade of exiting retailers from the mall since last spring has been staggering, with major tenants Nordstrom and Cinemark leaving the biggest vacancies to fill.

Other closures in the last six months have included Sephora, J. Crew, Hollister, Lucky Brand, The LEGO Store, Adidas, Burberry, and L'Occitane.

Since October, an expert in distressed assets, Trident Pacific, has been the court-ordered receiver for the mall property. Presumably they have been beefing security back up and seeking out new tenants at the mall — and the Chronicle reported several weeks ago that three of the vacant storefronts, including the former Burberry store, now have red "leased" signs on them.

In March, the new management rebranded the mall as the Emporium Centre San Francisco, in a nod to the longtime department store that lived at the property in the 20th Century, The Emporium.

Previously: American Eagle Sues Westfield Mall, Saying Ownership Let the Place ‘Deteriorate Into Disarray’

Photo via Yelp

The venerable San Francisco-based jeweler Shreve & Co. just announced they’re closing up their Union Square shop permanently, though watch and necklace enthusiasts can clean up on 60% off liquidation sales starting this Friday.

Our headline here notes that Shreve & Co. jewelry Store is 172 years old, having opened here in 1852. But it has not been at its current 150 Post Street location those entire 172 years. The shop was bumped out of its former Post and Grant streets space in 2015 when rival jeweler Harry Winston massively outbid them for the lease on that space (ah, those were the days). They were also based in Oakland for a couple years after the 1906 earthquake. And Shreve & Co. first opened at Clay and Montgomery streets, though moved shortly thereafter and was driven out of its Post and Grant store by the earthquake, in which the jewelry famously survived in a fireproof vault — even though the vault was too hot to open for three weeks.

Regardless, now in the year 2024, the Examiner reports that Shreve & Co. is closing its Union Square store permanently. A closing date was not announced, and this appears to be a “while supplies last” kind of thing. The Examiner adds that the shop will have a “multimillion dollar liquidation sale of jewelry and watches at discounts of up to 60%,” and that the liquidation sale  “will begin Friday and could last just days.”

Shreve & Co. will make its sole other remaining Palo Alto store into its new flagship, but “flagship” in this case just means the last remaining store.

In a press release, Shreve & Co. said that “dynamic changes” in the jewelry industry are forcing the closure. The company’s managing partner Lane Schiffman said in the release that “As we turn the page on this exciting new chapter, we are filled with gratitude for our journey in San Francisco.”

This isn’t Macy’s closing bad, but it’s still pretty bad for the beleaguered Union Square. Shreve’s location is 15,000 square feet, which is no small retail store. But commercial real estate brokers are putting the best face forward on the abrupt closure announcement.

“I just need people to understand that things are on an upward trajectory on a fundamental level” in Union Square, Maven Properties' Ali McEvoy told the Examiner. ​​"There are incredible deals to be made."

The Examiner says that McEvoy insists that a “well-known day spa operator” is planning on opening up in that same Shreve building in the near future (albeit in a smaller space), and that locations which had fetched $20-per-square-foot pre-pandemic are currently fetching $5-per-square-foot.

And we should note that Shreve & Co. is no longer locally owned. The North Carolina-based Schiffman Group bought the company in bankruptcy proceedings in 1992.

Related: Another Day, Another Two Union Square Retailers Say They're Closing — Zara and The North Face [SFist]

Image: Tracy G. via Yelp

Downtown SF's Vacant to Vibrant program, which puts pop-up businesses into vacant spaces rent-free around SoMa and the Financial District, is hosting a community market on this sunny Thursday afternoon on Market Street.

The Vacant to Vibrant Community Market event started at noon Thursday and goes through 4 pm, and it features live music, food trucks, vintage clothing for sale, and free ice cream. The event, co-sponsored by Wells Fargo, is happening in the plaza outside the Wells Fargo branch at 333 Market Street.

It's the latest in a series of activations organized by SF New Deal, which is running the Vacant to Vibrant program with funding from the city and private entities. The program launched last fall with a night market, and initially featured 17 pop-ups, including a community event space from local NPR station KALW, Devil's Teeth Bakery, Whack Donuts!, and the Mission's Sucka Flea. Nine of those have continued on through the spring.

As the Chronicle reports today, via SF New Deal, the program seems to be succeeding in reviving downtown's retail scene in a more permanent way. Seven out of those nine spaces that were used for the program's initial round have long-term leases signed and are set to receive more grant funding.

And now eight new pop-ups are joining the mix starting in June. These are:

• Aurora Centro, a deli
• Hungry Crumbs, a cookie bakery based in the Bayview
• JUMA Ventures’ Steep Creamery, a boba and ice cream shop
• Koolfi Creamery, an Indian-inspired ice cream shop that started in San Leandro
• Paper Son Coffee, a coffee shop that has been in residency at Neighbor Bakehouse in the Bayview
• 7x7 Social Club, a program from 7x7, the website and former magazine, that will provide "discounts and deals to businesses and events in the Bay Area"
• SAINTFLORA, a floral shop
• and Public Glass Gallery, a nonprofit arts organization and glass studio

The latter three of those will move into soon-to-be-announced spaces in Yerba Buena and the Financial District, while the five others are going into vacant spaces in the East Cut — that little-used neighborhood name that is basically Rincon Hill/East SoMa which realtors and the city are still trying to make happen.

"We are working every day to bring creative solutions and vibrancy to our Downtown and neighborhoods across the City, and Vacant to Vibrant is a great example of how we are solving for vacant storefronts while supporting our small businesses," says Mayor London Breed in a statement.

See info on all the Vacant to Vibrant pop-ups here. Businesses interested in participating in future rounds of the program can contact SF New Deal at vibrantSF@sfnewdeal.org.

Previously: Downtown Night Market and Friday Parties Help to Launch 'Vacant to Vibrant' Program