The SF Business Times is reporting here that the City just lost out on $34 million in taxes in the Twitter/MidMa tax zone. One car argue that creating this tax break was essential in attracting tenants like Twitter and Zendesk to a challenging part of the City but some can argue otherwise.
The MidMa / Civic Center region benefits from 1. immediate access to BART and Muni public transportation along Market Street 2. buildings possessing large floor plates which are attractive to tech firms seeking spaces that can house as many employees on one floor as possible and 3. a central location still close to SOMA and Downtown and 4. one of the only places left for tech companies to locate in SF.
Where else would Twitter, Zendesk, and others have gone? The Peninsula? Oakland? Possibly, but it's harder to attract talent to these regions. The City is so desirable that these companies cannot afford to be anywhere else.
Maybe the loss of tax revenue afforded merchants, residential landlords and others upside but did the City make a mistake?
If demand for this type of office space, type of building, and location keep increasing, then we can look back on the tax break as somewhat of a mistake as the revitalization and lease-up would have occurred anyway, without the tax break. Only time will tell.
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