.The Kitchen Sink

What recession?

The San Francisco papers keep running articles and gossip column items chronicling restaurant closings and deflating menu prices around the city. But Liaison, Downtown, Grasshopper, Zaika, Soifour, and LaRue Bistro & Brasserie have all opened in Oakland and Berkeley within the past six months. All cost $30 to $70 a pop. All are packed. Did someone fail to notify them that we’re at the front end of a recession?

What recession? “It hasn’t affected me. I’ve been running ahead of the same time last year,” says Lachu Moorjani, owner of Berkeley’s Ajanta. “When times get tough, the high-priced restaurants seem to slow down a bit, but the restaurants that offer very good value for the money do well.”

But higher-end restaurants aren’t seeing much change, either. “I don’t know when the slowdown might have started,” says Bob Klein of Oliveto. “I didn’t see any change in business in the first three months of the year. Right now sales are down about four percent from last year.”

Klein’s mildly lagging sales mirror Berkeley’s restaurant sales tax revenue figures — numbers that reflect a slowing economy but are far from a grim picture. The Berkeley Office of Economic Development reports a decrease of 4.1 percent from first quarter 2000 to first quarter 2001, not including inflation; total sales tax revenue for the city dropped 1.1 percent.

“Berkeley has traditionally been isolated from large economic swings because the size of our public sector is large and not as subject to economic fluctuations,” says Dave Fogarty, development coordinator. “The dot-coms were a minor phenomenon in Berkeley compared to San Francisco. Also, tourism is way off in San Francisco [this year]. That’s an even more important factor.”

Oakland doesn’t seem to be feeling the pinch at all. In fact, the Community and Economic Development Department reports a 9.9 percent rise in restaurant and hotel sales tax revenues from first quarter 2000 to first quarter 2001. According to Keira Williams, hotel industry revenue is only a small percentage of that figure, since the city only collects sales tax from hotel gift shops and restaurants.

None of the East Bay restaurateurs have lowered prices or changed menus — they haven’t seen the need for their older neighborhood clientele.

According to Cindy Lalime Krikorian of Lalime’s, “We don’t depend on tourism or a San Francisco crowd. We’re a little local place. The high spenders may be gone, yeah. People may order a less expensive wine, or one less appetizer. But business is steady.”

Says Klein, “I’m still seeing the same people coming in.”

Next week: What has changed in the East Bay’s restaurant industry.


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