San francisco restaurants

Experts say San Francisco restaurants won’t recover by 2023

The past few months looked promising for restaurant and bar owners in San Francisco after omicron cases dropped earlier in the year. When the proof-of-vaccination rule ended, the sight of more diners in SF neighborhoods seemed to resemble pre-pandemic levels. But with the upsurge in COVID cases, experts remain cautious and say it will be some time before local restaurants get back on track.

Ted Egan, chief economist at the San Francisco Comptroller’s Office, doesn’t know when the city’s restaurants can expect a full recovery. He estimates it will be over a year, as the food industry has been among the hardest hit sectors during the pandemic.

“The hospitality industry has more customers than a year ago…but I think it will recover to the same level as tourism,” Egan told SFGATE. “A year is perhaps too optimistic.”

Laurie Thomas, executive director of the Golden Gate Restaurant Association, says the industry won’t return to pre-pandemic levels in 2023 for several reasons.

“I think from everything I’ve seen economically and in terms of projections, I don’t think we’re going to get through this in a year,” Thomas said. “We are so dependent on international travelers for leisure and business, and we seem to be lagging behind, certainly [behind] the rest of the US The other thing is that we’re software and technology driven. We are equipped for remote work. How do you get people to want to come back to the office and go out – not just eat in office cafeterias? »

The lack of office workers en masse has spelled doom for many restaurateurs who operate in San Francisco’s Financial and South Market districts even now. Steve Sarver, owner of the Bay Area Ladle & Leaf mini-chain, runs eight restaurants across the city and said his business clientele is mostly made up of local office workers. To date, he said Ladle & Leaf’s economic outlook is still less than half of what it was before the pandemic. He added that Ladle & Leaf has closed three outposts in the past two years and currently has two SF locations temporarily closed.

The Ladle & Leaf outpost at 1 California Street in San Francisco, seen just before the pandemic began in 2020.

Courtesy of Ladle & Leaf
The Ladle & Leaf outpost at 1 California Street in San Francisco, seen just before the pandemic began in 2020.

The Ladle & Leaf outpost at 1 California Street in San Francisco, seen just before the pandemic began in 2020.

Courtesy of Ladle & Leaf

The Ladle & Leaf outpost at 1 California Street in San Francisco, seen just before the onset of the pandemic in 2020. (Courtesy Ladle & Leaf)

“At the moment it’s been very slow to come back,” Sarver said of his clients. “We are a restaurant open from Monday to Friday and we rely on people from the region. Our experience is different from that of other companies because the financial district was hit harder. We hope more people will return to work.

Looking at the Office of the Comptroller’s March 2022 Economic Outlook Report, weekly office footfall in San Francisco saw a slight increase from January, when attendance fell amid soaring omicron . The report says weekly attendance in March rose to just over 30% from January when it was just above 10%. And while there has been some progress, San Francisco’s workforce continues to lag behind other major US cities where office presence is much higher.

“Neighborhood restaurants have a much better chance of surviving than our downtown, Union Street and Moscone neighborhood restaurants, which just haven’t had foot traffic,” Thomas said. “Neighborhood restaurants are doing better, especially those that can take advantage of the shared space program.

For the past two years, restaurateurs have struggled with operational issues beyond foot traffic. Issues ranging from supply chain issues to finding and retaining staff have remained constant obstacles throughout the pandemic. Additionally, restaurant owners have been pressured to raise prices as the cost of groceries rises with inflation. The New York Times reports that prices for chicken, fish and eggs are up 14.3% since last year, a spike not seen since the 1970s.

Sarver said inflation has put a strain on his business and will likely lead him to raise prices at a much higher rate than expected. Thomas was not spared at her San Francisco restaurants Rose’s Café and Terzo, where she said she often paid her suppliers an extra delivery surcharge to help cover the cost of gas. Additionally, the recent spike in COVID cases has put Thomas on edge as she and her restaurant staff anxiously monitor intensive care hospitalization rates.

“People try to be consciously optimistic, but there’s still so much uncertainty,” Thomas said. “We don’t know if the cases will increase that we have to go back to the restrictions. It costs you enormously emotionally and financially.

Egan said new restaurant openings in San Francisco stalled when he looked at new food business listings between January and April 2022. The data found San Francisco had an average of 92 new entries, compared to an average of 94. during the same period last year.

Thomas believes that the emergence of new restaurants filling the empty spaces left by restaurants that have closed permanently is an encouraging sign. And with SF Pride in June and conferences, Thomas thinks there are “germs of hope”. For now, Sarver remains optimistic and will do everything in his power to keep his business afloat.

“We’ve been serving lunch to office workers for 23 years and we plan to continue to do so for another 23,” Sarver said. “We are committed to San Francisco and hope that the vitality of the financial district will return to what it was after past economic downturns.”