Tasting Success

By Ed Moosbrugger
Business Writer

April 5 -- Owners of some Downtown dining spots have a better taste in their mouths now that business is on the rise with the improved economy and a rebound in foreign tourism.

“We do see an increase in business in the last six months,” said Marvin Zeidler of Broadway Deli on the Third Street Promenade. “We see a lot of tourists coming back.”

West Hooker of Locanda del Lago at Arizona Avenue and the Promenade reported that business is generally up from last year, which was a somewhat flat year.

Two things that stand out, Hooker said, are more European tourists and more local residents with higher incomes.

“It looks like there is a stronger sense of neighborhood,” said Hooker, noting an increase in repeat customers.

Santa Monica isn’t alone in experiencing improved restaurant business.

“Business in hospitality is on the upswing generally,” said Jeff King, chairman and co-founder of King Seafood Co., which owns I. Cugini and Ocean Avenue Seafood on Ocean Avenue. “Business is up all over.

“We think that 9/11 is behind us,” said King, whose company has a dozen restaurants. “We see foreign people coming back. Japan is coming back. Europeans are coming back.”

“Our (Santa Monica) restaurants are doing fine and Ocean Avenue especially, where volume seems to increase every month,” King said. Sales are up about 7.5 percent this year at Ocean Avenue Seafood.

Downtown’s attraction for diners has increased with the expanded variety of restaurants there, while the movie theaters continue to be a key in drawing people from the surrounding communities who also dine while Downtown, Hooker said.

But while restaurant business is improving, some owners say it hasn’t recovered to the peak levels before 9/11.

“We’re not there yet,” Zeidler said. “We are climbing slowly.” Business went downhill for a couple of years through a combination of 9/11 and construction of the Transit Mall, he said.

Broadway Deli has suffered a big drop in food-to-go sales because people can’t just stop and drop off, and there’s less business from upscale customers because of the loss of valet parking, Zeidler said.

Some restaurants seem to have prospered steadily through the economic ups and downs of recent years.

“We see an improvement in sales every year” at Blueberry Bakery & Cafe on Santa Monica Boulevard, said Patrick Potter, CEO of Blueberry. “We do about 7 to 12 percent a year improvement.” Blueberry opened six years ago.

Business has been so strong, Potter said, that Blueberry began opening at 7 a.m. instead of 8 a.m. in February, and “we’re full from seven to eight.”

Potter believes Downtown Santa Monica was an ideal place to launch Blueberry, which has plans to open about a dozen restaurants from San Diego to Berkeley.

“Santa Monica is the model for any small community,” Potter said.

Downtown Santa Monica’s dining scene received national attention in mid March when Starbucks Coffee Co. re-opened its Hear Music on the Promenade as Hear Music Coffeehouse, a unique record store where customers can create personalized CDs while sipping a cup of Starbucks coffee.

“It’s really innovative what Hear Music is doing,” said Rene Mizrahi, owner of Gotham Hall on the Promenade. Hear Music also has added outdoor dining.

Gotham Hall itself, which is located on a second floor, plans to apply soon for a conditional use permit for outdoor dining.

“My whole premise being here 11 years is I want people in Santa Monica to have some place to go,” Mizrahi said.

The new outdoor dining in the 1400 block of the Promenade will be “a really nice addition,” said Kathleen Rawson, executive director of the Bayside
District Corp.

Meanwhile, Rawson said, a moratorium on most conversions of restaurants to stores on the Promenade seems to be working in stemming the loss of eating
places due to rising rents.

Barney’s Beanery plans to open on the Promenade around mid-summer in space formerly occupied by Teaser’s, said co-owner David Houston, who likes the casual, outdoor environment of the Promenade.

Restaurants, which have one of the highest failure rates of any business, are still attracted to Downtown.

But it’s not easy launching a new restaurant. When Alan Verma opened Jinky’s Cafe on Second Street in November 2002 he had some second thoughts for a while.

Second Street was pretty dead, Verma said, but he persevered and business has increased as word-of-mouth spread. “I am encouraged,” he said. “I’m pretty happy.”

THE AMERICAN FILM MARKET posted a 5 percent increase in attendance at the recent trade event in Santa Monica. Total attendance was 7,212 compared with 6,834 in 2003.