Spotify gives up SF Mid-Market office - and tax breaks - amid safety concerns

Parts and parcels…

When music streaming company Spotify moved to San Francisco’s Mid-Market area in 2013, its arrival was hailed by city officials as another revitalization of the troubled neighborhood.

The Swedish tech company leased three floors of office space in a 1922 building at 988 Market St. that includes the Warfield theater concert venue. It was a “perfect fit” for the music-focused company, Spotify said at the time.

But in the past month, the company moved out before its lease ended — and will no longer be eligible for the controversial Mid-Market payroll tax break. The 2011 program gave nine companies — including Spotify, Twitter and Zendesk — a tax break in exchange for opening offices in the neighborhood and providing community benefits like donations to nonprofits.

Spotify’s departure underscores continued challenges in the Mid-Market area, where tech investment has brought thousands of high-paying jobs but hasn’t changed a challenging street milieu of poverty, homelessness and drug dealing.

Spotify’s new office is the Merchants Exchange Building in the north Financial District, which includes the swanky Julia Morgan Ballroom. The company moved in about a month ago, said a Spotify security guard who gave his first name as Charles.

The change was motivated in part because some Spotify workers felt unsafe, said two former Spotify workers, who requested anonymity to avoid repercussions from former or current employers. The Mid-Market and Tenderloin neighborhoods have some of the highest violent crime and poverty rates in the city, according to government data.

Last year, a female Spotify employee was slapped in the face by a homeless woman near the office, the former employees said. A person in the real estate industry familiar with the building who was not authorized to speak publicly about the episode also confirmed that the incident happened.

“There were safety concerns,” one of the former employees said, including drug dealing on the corner. “I think it really alarmed people.”

Employees who had moved from Sweden were unaccustomed to San Francisco’s homelessness crisis, the person added.

I love watching what happens at the crossroads between virtue signaling and reality.

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