Last year, San Francisco’s visitor industry hit its lowest point since the pandemic, but insiders say that 2025 will be the start of a comeback, with a string of high-profile events on the horizon and strengthening convention business.
The end of 2024 also closed the chapter on three months of rolling hotel labor strikes, which impacted 27% of the city’s hotel inventory.
“We do expect 2024 to be the trough of the recovery,” said Emmy Hise, senior director of hospitality analytics for CoStar, citing weak convention business and the absence of major events like the Asia-Pacific Economic Cooperation summit, which last took place in San Francisco in 2023.
“We knew that 2024 was going to be a tougher year, and the hope for last-minute convention pick-up just didn’t come to fruition,” Hise added.
The city’s hotel performance metrics last year showed stagnant occupancy paired with declining average daily rates and revenue per available room (RevPAR). ADR was down around 3.8%, while RevPAR slipped 3.7% year-to-date through October 2024, according to CoStar data.
Consequently, San Francisco ranks dead last among all U.S. markets for hotel rate recovery from 2019, a major reversal for a destination that once commanded some of the highest room rates in the nation. In 2019, San Francisco’s ADR was $247, while current rates hover at roughly $220, well below even 2016 levels.
Turning the page on a tough year
Anna Marie Presutti, CEO of the San Francisco Travel Association, also said 2024 was an especially “tough year” for the destination.
“I’m really happy that 2024 is over,” she added. “But when you look back and think about all the things that we’ve survived through, that only helps us grow.”
In addition to lagging convention and large-event business, reduced international visitation and the slower return of Asian travelers, particularly from China, continues to take a toll.
The city has also grappled with concerns related to public safety. But Presutti said San Francisco has been “battling those perception issues pretty well, and we’ve turned the corner there.”
As of May 2024, property crime had dropped 32%, while violent crime was down 14% year over year. The city plans to continue making substantial investments in public safety this year, greenlighting funding for 200 additional police officers and new surveillance technologies, among other measures.
It also reported strides in addressing homelessness, with early 2024 data revealing San Francisco’s lowest level of street homelessness in at least 10 years, thanks to a significant increase in both shelter capacity and housing slots.
The number of people living in tents, structures or on the streets in San Francisco decreased 13% since 2022, dropping to fewer than 3,000 people early last year.
“I think people are starting to realize that the ‘doom loop’ narrative was just that: People were regurgitating stuff from four years ago,” Presutti said. “It is absolutely a perception issue, and I think we’re getting through that, and I think people are starting to realize that this city is as beautiful and as iconic as it’s ever been.”
A series of high-profile sporting events this year, including the NBA All-Star Game in February, NCAA March Madness men’s basketball games in March and the Laver Cup tennis tournament in September, will put San Francisco in the spotlight and help further reshape perceptions, Presutti added.
“You’re going to be hard-pressed to turn on the television on a quarterly basis and not see San Francisco somewhere,” she said.
Looking further ahead, the greater San Francisco area will host additional major events in 2026, including FIFA World Cup matches and the Super Bowl, which will take place at Levi’s Stadium in nearby Santa Clara.
Convention bookings are on the upswing, with the city securing several major events within shorter booking windows than traditionally seen. Most notably, Microsoft confirmed its Microsoft Ignite convention for November 2025 with just one year’s lead time, which Presutti called a major departure from the typical booking window of 5 to 10 years for citywide events of that scale.
“That is unheard of for a convention of that size,” she said. “But it is demonstrating that things are moving — they’re just behaving a little bit different than they have in the past.”
The improved outlook is reflected in San Francisco Travel’s 2025 forecast showing visitor volume climbing from 23.2 million in 2024 to 23.9 million this year and spend projected to jump from $9.24 billion to $10 billion over the same period.
Hotel performance is also expected to rebound from 2024’s projected 62.8% occupancy and $224.72 ADR to 64.1% occupancy and $232.99 ADR in 2025.
Perhaps most notably, events at the city’s Moscone Center convention complex will jump from 25 to 30 this year, with associated room nights up nearly 60%, to 659,700.
The city also launched initiatives to enhance the visitor experience, including designated entertainment zones where outdoor alcohol service is permitted. The zones, along with expanded street festivals and night markets, aim to activate neighborhoods and offer new reasons to explore the destination, Presutti said.
And while specific details remain under wraps, San Francisco Travel plans to increase marketing with fewer conventional promotional strategies this year.
“You’re going to see San Francisco show up in unexpected places,” said Presutti. “We’ll make sure that the best of our city is being showcased, but we’ll also be introducing a lot of new things that you might not know about in San Francisco. It will be a combination of the new and the old.”
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