The city has removed parking spots along Powell Street between Ellis and Geary and installed new pedestrian pods instead.
The new pods not only create more walking space, but they also give pedestrians a chance to stop and take in the sights without blocking the sidewalk.
"There are benches, there is landscaping, there are high top tables that people can stop and have some coffee," said Union Square Business Improvement District's Linda Mjellem.
An estimated 100,000 people converge on Powell Street near the cable car turnaround on a regular weekend.
Free wireless internet will also be offered along that portion of Union Square.