As Oakland’s director of economic and workforce development, Ashleigh Kanat’s job is to make it rain for the city. An Oakland native, Kanat is a proud civic booster, projecting cautious optimism even in the face of challenging data.
So when I asked her why the economic tides in Oakland didn’t seem to be rising as fast as they are in San Francisco, Kanat suggested we meet for coffee at Sweet Bar Bakery, a cute, high-ceilinged café with good bagels in Oakland’s shiny new Northlake district. In 2024, local businesses cut a deal (opens in new tab) with the city to spend private capital on gussying up this part of town, a dozen blocks in a rough triangle north of Uptown and Lake Merritt. Kanat hopes Northlake can be a model for what Oakland could be — placemaking that’s good for the city and attractive to new residents and businesses.
From some angles, the densely packed residential towers and gleaming, narrow streets of Northlake recall the parts of Vancouver that TV shows often pretend are New York. If the district’s streetside retail spaces have tenants, they’re upscale. Whole Foods is an anchor. The Oakland outpost of Flour + Water Pizza Shop (opens in new tab) is here, just a couple of blocks from the glossy trompe l’oeil pastries of Tarts de Feybesse (opens in new tab). Down the street, a group of investors and regulars is about to reopen The Athletic Club (opens in new tab), a popular sports bar. We’re just blocks from the old Oakland YMCA, yet there’s a shiny new gym. “Oh,” Kanat says, stopping in surprise. “An Orangetheory!”
We amble to a corner of a parking lot that Northlake calls Lot 2270 (opens in new tab). It’s full of outdoor furniture and multicolored surfaces — not quite a park, more like a shared backyard, complete with semi-regular food truck meet-ups. It’s meant to be a new neighborhood hub. “This is a spot to watch,” Kanat says.
Obviously, most of Oakland doesn’t look like Northlake. Wander the city, and you’ll encounter empty storefronts (opens in new tab), informal camps of unhoused people, daunting piles of garbage (opens in new tab), and pothole-ridden streets (opens in new tab). In a recent poll (opens in new tab), 55% of Oakland residents said the city is on the wrong track, and about 70% said Oakland needs more cops and surveillance, even though crime is way down.
This is troubling for The Town, not just because it’s terrible when residents feel their city is getting worse, but also because San Francisco — Oakland’s beautiful, rich, arrogant older sister — feels like it’s going in the exact opposite direction.
Newsflash: It’s boom times in the City by the Bay. Rents for homes and offices in San Francisco are way, way up, and would-be homebuyers are waging six-figure bidding wars in pricier parts of town. Crime is down, as are street encampments, tents, and RVs occupied by the unhoused. Street festivals fill downtown with people and echoing EDM — you can even drink beer outdoors without concealing it in a paper bag.
Meanwhile, Oakland is undergoing what a Metropolitan Chamber of Commerce report politely describes (opens in new tab) as a “period of structural adjustment.” Since the pandemic waned, employment in the city has been flat. Sales tax receipts are weak compared to the rest of the Bay Area (opens in new tab). The Port of Oakland, which brings in $970 million in state and local tax revenue annually, is handling roughly the same amount of cargo as it did in 2015 — while competitor ports in Los Angeles and Long Beach were up last year by 25% and 37%, respectively. Even the number of passengers flying through Oakland San Francisco Bay Airport is declining (opens in new tab).
This is reductionist, but many Oakland residents believe that to fix these things, The Town needs more money — tax revenue, private investments, philanthropy, whatever. Maybe capital from San Francisco’s burgeoning AI explosion could provide it. I ask Kanat when Oakland might see some of the benefits of this boom.
She tells me an open secret: “Oakland is a spillover market. As the San Francisco office market goes, so goes the Oakland housing market.”
In other words, when San Francisco experiences one of its predictable-but-irregular economic booms, so too does Oakland. Just … later. “We totally benefit,” Kanat says. “Yes, there is a bit of a lag.”
Maybe that’s where we are — the interregnum between eruption and reverberation. But there are some worrying signs that this tech boom may not be big enough, that Oakland’s problems are too intractable, that even an overheated San Francisco market can’t bail out Oakland this time. At least not without some major structural changes.
Can Oakland catch fire?
If the San Francisco office market has to start boiling before the Oakland housing market can simmer, we should probably stop watching the pot — because this might take a while.
Yes, big AI companies are expanding and leasing commercial space in the West Bay. Over the last year and a half, businesses have rented a record-breaking 5 million square feet in San Francisco — nearly half of that in the first three months of 2026. (More than a million square feet is leased by OpenAI (opens in new tab) alone.) As a result, commercial rents are way up, especially in Mission Bay, China Basin, and South of Market — though, notably, not in the still-struggling financial district.
The relative emptiness of downtown SF spells bad news for Oakland, which always harbors dreams of luring companies that have been priced out of the Bay Area’s financial center. With rare exceptions, hot tech companies haven’t moved to Oakland during past tech booms. The way it worked was that blitzscaling San Francisco companies squeezed out smaller firms in industries like insurance, engineering, and accounting, plus a vast universe of scrappy and scraping nonprofits. That’s who migrated across the bay.
And that’s fine; dollars are dollars. In the mid-2010s boom, Mayor Libby Schaaf’s administration was able to bring in investments and new corporate tenants — Blue Shield, Credit Karma, Square, and PG&E among them — to a vibrant Uptown and financial district. By 2019, 96% of the office space in San Francisco was rented — as was 93% of Oakland’s.
But that was then. In 2026, San Francisco simply isn’t as logjammed, and Oakland isn’t grabbing the overflow. Vacancies in San Francisco are down from their COVID peak but still above 30% — compared with 25.6% in Oakland. Class-A office space in downtown San Francisco is renting for $6.31 a month per square foot, while Class-A space in downtown Oakland is $4.30. That’s not a big enough delta to be appealing to companies, considering the one-time cost of moving and the hassle to workers, according to commercial real estate brokers.
“In San Francisco right now, all signals are moving positively,” says Wescott Owen, a research lead for Cushman & Wakefield in the East Bay. “But costs are well below where they were prior to the pandemic.”
The industrial space available in Oakland might not be what the new tech boomers want, either. When OpenAI needed factory space for an expansion into robotics, it went farther north to Richmond (opens in new tab), to a factory that had been kitted out for a now-bankrupt battery startup, wired for an unusually high 14,000 amps of power. Kanat says improving power capacity is on her to-do list for Oakland’s commercial buildings. “Power is almost the No. 1 thing we can do, from an economic perspective,” she says. “It’s one of the very first requests we get, and we’re working on bringing significant capacity online.”
As a result, the Oakland office market is quiet. Entire office towers in downtown Oakland are selling for rock-bottom prices, like the 10-story building at 1440 Broadway that went for $43.5 million in 2018 and just $5 million last year — about the price of two median single-family homes in San Francisco. The opening of Samuel Merritt University (opens in new tab) in a 10-story, $240 million building downtown is the brightest spot recently. It’s not nothing — all those students have to buy lunch and coffee somewhere. Plus, Merritt is a health sciences school with a big nursing program, and health services is one of Oakland’s biggest employment categories. But it’s not the next Anthropic.
Condos and homes are equal
The office market in San Francisco is complicated; the residential market, however, is simple. In a word, it has gone berserk. The median price of a house in the city increased 22% in the first quarter of 2026, to $2.1 million, according to Compass — higher than early 2022, the last time prices were ridiculously overheated. And that’s citywide; the median in Pacific Heights brushed up against $7 million, and the biggest sale in that neighborhood in the previous year was $43 million.
Citywide, condominium prices are up 18%, and a one-bedroom apartment rents for more than $4,000 a month. According to the Economic Research Institute, San Francisco is the second-most expensive city (opens in new tab) in the U.S. You’d think that would mean wannabe homeowners priced out of San Francisco might head for Oakland. Hungry for an easy commute but maybe also a backyard? Go east, young roboticists!
Here again, though, Oakland isn’t delivering. The issue isn’t demand. It’s supply. “We have an incredible lack of housing inventory, especially affordable inventory, in our area,” says Andrea Gordon, an East Bay Realtor at Compass. Condominium prices and downtown rents are stable or falling, a predictable result of new construction —10,000 units were built in the last decade. The trouble is, “condos are not as popular as single-family homes, full stop,” Gordon says.
You might’ve seen reports that Oakland home values are falling faster (opens in new tab) than those of any other U.S. city — off almost 30% from their value in 2019. But more granular data (opens in new tab) tells a more complex story. In bougie Rockridge, the median sale price in the past year was $1.8 million. In Piedmont — technically a separate city, but surrounded by Oakland — the median sale was $2.7 million, higher than San Francisco. But in less white, more working-class neighborhoods like Fruitvale and South Oakland, it was closer to half a million.
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“I’ve been in a bunch of bidding wars in the recent past in Oakland. The news is lagging behind,” Gordon says. “The reality is, if a home is desirable, has a view of the bridges or the water, or has beautiful square footage and layout, those homes are getting tons of offers.” Homes in wealthier neighborhoods like Temescal and Redwood Heights and on the Oakland side of the Berkeley-Oakland border are going for as much as 30% to 50% above asking, she says.
But such listings are relative rarities. When East Bay cities manage to build homes these days, they tend to be in medium-size or big multi-unit buildings, and the emphasis is on construction near transit stations (opens in new tab). Oakland doesn’t have a lot of the three-bedroom, two-bathroom houses in fancy neighborhoods desired by young tech workers with disposable incomes and growing families.
“The people who are buying houses have a lot of buying power, either their own money or from the Bank of Mom and Dad, and consequently, they want the nicest house they can possibly buy,” Gordon says. “In neighborhoods that have traditionally been occupied by people that don’t make a lot of money, there’s a lot of deferred maintenance. And most of these kids buying these houses — they are kids; they’re Gen Z — they’re wanting something almost perfect.”
Forget about that cracked foundation or the electrical panel that won’t accommodate a heat pump. Gordon says she’s had buyers reject houses because they were pink. “They may be making $400,000 a year, but they’re required to work really hard for that money. They’re working 18-hour days,” she says. “They don’t have the time to do a big remodel, nor the patience.”
In the short term, that means knife fights over single-family stock in already-rich parts of town. And that bloodsport has consequences. Either demand will bubble over to other neighborhoods, displacing poorer Oaklanders — or their property values diminish as old, small homes languish on the market. A house’s value goes up only if you can sell it.
The Bay’s Charlie Brown
Oakland’s problems stem in part from its eternal status as the Bay Area’s Charlie Brown — always getting the football swiped away at the last second by Lucy. Twice as big in area as San Francisco, with half its population and one quarter of the annual budget, The Town hustled and bustled through the 19th century and was an important destination for the Great Migration of Black people out of the American South. But in the 1960s, urban renewal shoved freeways and elevated BART tracks through grand Black neighborhoods and retail districts. In the 1970s, Proposition 13 gutted California cities’ tax bases and stuck them all with structural debt — worse in cities where homes don’t change owners frequently.
The military used to be a major employer, but three bases closed in the late 1990s. In the 21st century, the city lost its daily newspaper (opens in new tab), its alt-weekly newspaper (opens in new tab), three major-league sports teams (opens in new tab), and (opens in new tab) three (opens in new tab) colleges (opens in new tab) — four if you count the two community colleges planning to merge (opens in new tab) this year. Mayor Jerry Brown’s ambitious commercial development of Oakland got stymied by the 2008 real estate crash; Schaaf’s commercial and housing construction ran aground on COVID and concerns about homelessness and property crime. Lately, Mayor Barbara Lee has struggled mightily (opens in new tab) with public safety issues and illegal dumping (opens in new tab).
Oakland’s public servants know all that. They’re trying to fix it — while streamlining zoning and permitting, building housing, boosting minor-league sports teams, and touting port and airport access and a reasonably priced, medium-size convention center.
But Oakland’s structural issues run deep. Activists point to a kludgy system for hiring contractors, lingering debt, structural racism and poverty, even the city charter (opens in new tab). California cities typically give a lot of power to the city manager, but Oakland vests more authority in the office of the mayor — and Lee is floating a version of the charter that gives the mayor even more power.
The city doesn’t have a Billionaire’s Row like San Francisco that might provide philanthropic help. (Perhaps Oakland should consider forcibly annexing Piedmont.) Rich Oaklanders barely support the cultural institutions the city already has, like the Oakland Museum of California (opens in new tab) and Oakland Symphony (opens in new tab), and newcomers are even less likely to do so.
Take the Crucible (opens in new tab), a cavernous maker space and craft education hub in West Oakland that has had financial problems for years. “It’s kind of crazy that we live in the heart of the tech community, and yet we can’t tap into those resources. It’s one of the things that’s baffled us for a long time,” says Ismael Plasencia, the Crucible’s senior community partnerships director. “We just can’t seem to get a billionaire to sprinkle some love on us.”
The city’s largest cultural institution, the OMCA, combines natural history, California history, and art into one multi-level brutalist museum building. It hosts summertime outdoor concerts and food-truck conclaves. It’s delightful. And its largest source of revenue every year isn’t visitors or donors. It’s the White Elephant Sale (opens in new tab), a multi-day rummage sale in a warehouse near the Fruitvale BART station — 1,000 volunteers staff the registers, and 30,000 people attend. This year it took in $3.3 million.
“The Met has the Fashion Gala. The Oakland Museum of California has the White Elephant Sale,” says Lori Fogarty, the museum’s executive director, with a you-can’t-make-this-stuff-up shrug. “It’s a real mix here. I don’t think anybody has figured out tech people giving money to arts and culture. If you figure it out, can you let me know?”
The low-key greatness of The Town
Oakland already has low-key greatness — world-class food (opens in new tab) ranging from perfect streetside tacos to Michelin-starred slow-poached egg yolks. Foundational music, cool architecture, great nightlife. The same poll that showed Oaklanders were worried about the city’s direction said that they wouldn’t dream of leaving. Only Oakland could produce Ryan Coogler, Zendaya, Alysa Liu, Boots Riley, and Kamala Harris. It just doesn’t have the economic engine it needs to continue producing the next generation of Town legends. Maybe an influx of capital and people from across the bay would start the flywheel spinning again.
But the lessons of past booms are that Oakland can be fragile. The money tends to start making its way east just before the inevitable bust. When the labor market is good, Oaklanders land jobs, but when it falters, poor and nonwhite people lose those jobs first.
“Oakland’s had these moments where it feels like it’s making it,” says Schaaf, who served as mayor from 2015 to 2022. “But I feel like they will never be durable if we’re just trying to be another San Francisco, a lesser version of San Francisco, instead of being the best version of ourselves.”
The city’s current leadership agrees. “We are clear-eyed. Investment flowing into Oakland does not always automatically translate into opportunity for Oaklanders,” says Visraant Iyer, the city’s director of strategic partnerships. “The question we are actively working to answer is not just whether growth comes to Oakland, but whether the jobs, contracts, and wealth that come with it are accessible to the people who have long called this city home.”
Standing on a sunlit corner in Northlake with a fancy coffee and a pastry haul from Tarts de Feybesse (for my kids!), I wonder if AI money from across the bay would actually have the impact Oakland might want. What’ll happen when it inevitably, tidally flows back out again?
Maybe it’s better to have boomed and busted than never to have boomed at all. But I recall something the novelist Glen David Gold told me years ago. He used to live in San Francisco and wrote a lovely, Oakland-set historical book called “Carter Beats the Devil.”
“Poor Oakland,” Gold said. “It never seems to catch a break.”