SF Probes Rental Scams as Phelan Building Defaults on $215M Mortgage

San Francisco policymakers and property owners are navigating a shifting residential and commercial landscape this week. At City Hall, lawmakers convened their first formal hearing to combat online apartment listing fraud, even as one of Market Street's landmark flatiron office buildings entered loan default and downtown merchants prepared a major seasonal activation in Union Square.

Supervisors Hold First Hearing on Residential Rental Scams

The San Francisco Board of Supervisors held its first hearing on residential rental scams after prospective tenants reported losing thousands of dollars to fraudulent online listings. According to testimony presented to the board, scammers frequently copy photos from legitimate real estate sites, post below-market apartments on social media and classified platforms, and demand wire transfers or payment-app deposits before showing a unit.

City officials and tenant advocates called for stronger coordination between the Police Department, the District Attorney's Office, and housing agencies to track serial fraudsters and educate renters. Supervisors also discussed creating a centralized reporting portal and multilingual consumer warnings ahead of peak moving periods.

Historic Phelan Building Defaults on $215 Million Mortgage

In the commercial real estate sector, the owners of the historic 11-story Phelan Building at 760 Market Street in downtown San Francisco defaulted on a $215 million commercial mortgage. Built in 1908 after the 1906 earthquake, the flatiron-style office and retail property spans roughly 300,000 square feet near Union Square.

The $215 million loan entered special servicing after office vacancies rose and remote work reduced tenant demand along the Mid-Market and downtown corridor. Real estate analysts said the default could lead to a loan restructuring, foreclosure, or discounted sale similar to other recent downtown office trades.

Real 65-Foot White Fir Returns to Union Square

Just blocks from the 760 Market Street property, downtown business groups are banking on holiday traditions to bolster retail corridors. San Francisco will install a real 65-foot white fir Christmas tree in Union Square for the 2026 holiday season, replacing the artificial tree used for more than two decades.

Harvested from northern California near Mount Shasta, the live 65-foot tree will be decorated with more than 30,000 energy-efficient LED lights and thousands of ornaments. The Union Square Alliance and city leaders said the return to a natural tree aims to boost downtown foot traffic and seasonal retail activity, with a public tree-lighting ceremony scheduled for early December alongside the annual ice rink and winter walk programming.