San Francisco nearly shut down. Sad state. Trump will be the nominee.

0:00 Speaker 1 To get an update what the heck is going on in San Francisco. We have my good friend John Chachis, who is very close to things in San Francisco. And as a matter of fact, your daughter owns a big company there.

0:12 Speaker 2 Well, we actually as a family own the oldest continuously operating enterprise in San Francisco. It’s a luxury retail company called Gumps. It’s a beautiful store and it’s been there for one hundred and sixty five years.

0:24 Speaker 1 So tell me what’s going on.

0:25 Speaker 2 Well, the town, the town is suffering, and it’s suffering from bad policy and now the post COVID hangover of having people not in their offices. And we’ve seen this. We’re seeing this in all the major cities, but San Francisco worse than any where. People left during COVID. They were told leave, don’t come to work. And once you’ve

0:46 trained people not to come back into the city, you get a problem worse when the city’s fabric has been torn by bad policies, so you have homeless people, drug addicts, scary stuff, human waste on the street. We’ve seen a significant reduction in, unfortunately, the number of people that come to this beautiful city.

1:05 Speaker 1 And the other day you told me that the first thing you have to do in the morning is hosed down the sidewalks to get the human waste off the sidewalks.

1:12 Speaker 2 Yeah, it’s tragic, and it’s gotten. You know, the police department’s done a better job of making sure there are fewer bodies there in the morning, but all around, all around the business district in San Francisco, the financial District and Union Square where our store is. Each day you have to really you have to spend a lot of

1:31 time making sure that your customer who’s coming to buy something beautiful in your store doesn’t step over needles and people in human waste.

1:37 Speaker 1 And over At lunch the other day, you said that the difference between your your traffic people coming into the store from the suburbs is almost zilch. You said that it’s now eighty seven percent on the internet and thirteen percent in person. Yeah, because nobody wants to come to San Francisco.

1:57 Speaker 2 Well, we’ve pivoted the business and thankfully we have a brand that people love that sold in all fifty states in the country. But the volume of our visitors is way down. And you know, when we have a devoted we love the city. It’s been there for years and years.

2:12 I love San Francisco. It’s one of the most beautiful cities in the country. But when you look at the policies, one statistic has just astonished me is the cellular telephone data traffic in the Greater Bay Area is at about thirty two percent of its peak from twenty nineteen. The fundamental thing that needs to happen in that city, as

2:31 well as in New York, is putting people’s butts back in their chairs in their offices. And until that happens, until policy changes so that we’ve induced businesses to bring people back to their offices. These cities can talk about it all day long, they are going to suffer and San Francisco is at the high end of that suffering.

2:48 Speaker 1 And I understand that you’re going to close the location and move it.

2:52 Speaker 2 Well, we’re trying very hard not to close the location, but we are evaluating our options at the end of this year going into next year. Are there better places where our customer will still come and see us that doesn’t have to struggle with the terrible things in San francisc We don’t want to leave San Francisco. We want

3:08 San Francisco to write itself. But until the until the mayor, you know, some of these policies are absurd. People literally walk into the Walgreens or the Nordstroms and just you know, pack stuff off of the shelves into their bags and walk out. That kind of nonsense has to stop in order to make San Francisco viable. And the media needs

3:25 to cover this. The media needs to be all over the mayor and the city supervisor and the governor actually doing something to correct it because it’s just lousy urban policy and it’s destroying the city.

3:37 Speaker 1 A big hotel. It was made big headlines the other day that they just closed down or they just stop paying their mortgage. You have a seven hundred million dollar one or something like that. It’s the biggest, a big Hilton.

3:51 Speaker 2 It’s a huge Wells’s a it’s a red. There are these entities you know them so well that own lots of properties, and I think they turned this property, the Hilton Union Square as well as the Park fifty five.

4:03 I think they just decided that operating those assets was never going to be profitable, so they sent the keys to their lender. It was I think it was a seven hundred and fifty million dollars mortgage. That’s quite shocking actually, when one of the largest operating hotels on Union Square its owners basically give up. But it’s back to this

4:19 basic problem. And New York has this problem too. As you know the statistics in cities twenty five percent of people are showing up to work on Mondays, seventy six seventy five percent on Tuesday, Wednesday and Thursday, and seven percent on Friday. That is a non workable set of math that doesn’t work in New York, Seattle, Portland, San Francisco,

4:40 or anybody else that lives with that kind of of in office performance. And so what’s going to have to happen is good old fashioned tax policy. We’re going to need to give a tax cut to businesses that in their policy handbook require five days a week in your office.

4:55 And it’s going to increase the deficit in California, it’s going to increase the budget deficit in the York. But until policy people actually put a tax incentive for businesses to change their requirements so people are back in their seats in their offices, these cities are going to suffer.

5:11 Speaker 1 Now you’re also in Republican circles in politics. Tell us what do you think about what’s happening with President Trump.

5:22 Speaker 2 I’m astonished this morning. On the one hand, my progressive friends on the left and who consume media in cities like New York in LA, they’re cheering. They think it was a great victory. I think this one ensures Donald Trump will be the nominee for the Republican Party. I think that there’s not a person in his base who

5:41 doesn’t think that what was just done is essentially political political retribution by and they’re not going to change their vote. And almost everybody else that’s in the race when asked what about Trump, well maybe with exception of Chris Christy, who will punch anybody in the face, every other candidate is going to is going to line up to defend him.

5:59 And I think this trump as the nominee.

6:02 Speaker 1 John Chatches, thank you so much, and God bless you, and let’s pray for our cities. Otherwise we’re in deep crap.

6:09 Speaker 2 I hope people will go to gums dot com and buy some jewelry and things. I hope so so take care, John, Thank you,