As Total Food Service continues our look at how the restaurant industry is faring in key cities across the country post pandemic, we are turning our focus on San Francisco. The city that brought us such culinary luminaries as Alice Waters of Chez Panisse, Thomas Keller of French Laundry and Judy Rodgers of Zuni Café, is facing a different landscape today because of COVID.
It’s been two months since San Francisco dropped all restrictions after it shut down on March 16, 2020. While the city’s restaurants are trying to steady itself after a year and half of disruption, the Delta variant is now reminding us, we’re not out of the woods yet. Along with the uptick in COVID cases, comes debates about employee and customer vaccine restrictions, mask mandates, on top of staff shortages.
“I don’t think people are thinking about closing because of the variant,” says Eve Batey, former editor Eater San Francisco, now editor of the NOSH. “But many of San Francisco’s big-name restaurants remain closed, partly because of it.”
When asked, what does San Francisco’s restaurant scene look like at the moment, Batey said, “The city’s residential neighborhoods have ascended, while its downtown area, with the fancy restaurants and cool chefs, have receded from the spotlight. Most significantly, because tourism is not up to full capacity and people are not working downtown at the levels they used to.”
Laurie Thomas, executive director of the Golden Gate Restaurant Association (GGRA), who also owns Rose’s Café and Terzo restaurants, both in Cow Hollow, offered, “We are fortunate our restaurants are not in downtown. The neighborhoods are where there is a lot of life right now.” Batey said, “The residential restaurants are packed and impossible to get into.”
Where are we talking about? “Already established areas like the wealthy Noe Valley are seeing a resurgence of busy restaurants, and the same is true for locations like the Sunset and Richmond Districts. Both are located by the beach. Before you might have seen just serviceable dining options, now places are popping up that people can’t wait to eat at,” shared Batey.
Louis Cornejo, president of Urban Group Real Estate, stated, “Even in these trending areas you’re still seeing a 20%-25% drop in rents compared to pre-pandemic. Now landlords might be asking for $6-$7 per square foot monthly, where before they were getting $9 per square foot for the same space.”
Can the restaurants left standing today attest their success to a survival of the fittest? According to Batey, “This was definitely a period when being small and able to be nimble was a benefit.” Cornejo said, the smaller spaces that were barely making it before COVID didn’t have enough reserves and had to give the keys back to the landlord. The places able to switch to delivery, were able to work out a deal with their landlords.
Restaurateurs looking to open restaurants now are looking for smaller spaces. A few reasons for this include, it costs less to build out the interiors and it’s easier to run with less staff.
Let’s look at the concepts trending now: burgers, pizza and specialty sandwiches, “anything grab-and-go is booming. Yes, it’s a pandemic thing, but I don’t see that going away. It used to be there’s a sandwich shop on every corner how can they all stay in business, now it’s like there’s a sandwich place on every corner and they’re all jam packed,” shared Batey.
Thomas Keller was doing takeout. Alice Waters is still doing takeout. Chez Panisse isn’t expected to open for indoor dining until October. Even prolific restaurateur Adriano Paganini’s Back of the House Restaurant Group is getting in the game, opening up a second location for his fried chicken sandwich restaurant, The Bird, in the Hayes Valley.
Palm City in the Sunset District, opened two weeks before the shelter in place happened. Dennis Cantwell, alumni of Michelin starred restaurants, Zuni Café and Nopa, where he was wine director, and his wife Monica Wong, intended to open it as a small-plate restaurant, but with lockdown getting things set up with purveyors proved very difficult. “We were like, well we can at least get bread and we can get sliced meats, let’s just do hoagies,” recalled Cantwell, a Philadelphia native.
That pandemic twist landed them on Esquire’s list as one of America’s best new restaurants to open in 2020. The magazine writes “they now offer some of the most nuanced classic hoagies in the country.” Cantwell shared, “The hoagies have been keeping our lights on.”
Thomas shared, some of the initiatives the city has taken to help the other restaurants keep their lights on include the Shared Spaces Program, now a permanent measure, which allowed restaurants to repurpose curbsides, sidewalks and open lots into outdoor seating for their dining establishments.
Batey lamented, as indoor dining resumes the question I’m hearing from many owners now is, “How do I balance this huge revenue boost from takeout, service diners seated indoors, and accommodate the unexpected tabletops resulting from the newly created outdoor spaces. In some cases, these kitchens are 10ft. by 12ft. and they are being stretched beyond capacity.”
Time will tell how they will manage it all but considering all the other hurdles San Francisco restaurants have had to overcome this past year, this one is a nice problem to have.
