Why is it becoming increasingly impossible to open a restaurant on the Peninsula? | Peninsula Foodist | Elena Kadvany | Almanac Online |


https://almanacnews.com/blogs/p/print/2019/09/17/why-is-it-becoming-increasingly-impossible-to-open-a-restaurant-on-the-peninsula


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By Elena Kadvany

Why is it becoming increasingly impossible to open a restaurant on the Peninsula?

Uploaded: Sep 17, 2019

In early August, Ben Bate got some bad news.

The City of Mountain View informed him — seven months after he took over 383 Castro St. to open Ludwig’s German Table — that the building's grease trap needed updating. Digging out the carport and sinking the 500-gallon grease trap will push the restaurant's opening back another three to four months.


The future home of Ludwig’s German Table in Mountain View (a building where Bierhaus used to operate out of) on Castro Street. Photo by Magali Gauthier.

The grease trap was simply the latest request from the city that has frustrated Bate and delayed the opening of the popular German restaurant and beer garden from San Jose. There was debate over the type of plants that would be outside the restaurant, the color of the tables, the style of the chair legs. More recently, the city asked Bate to remove the Corinthian detail at the top of 21 white columns that anchor an outdoor trellis.

The cost to do this? About $12,000.

When I spoke with Bate and co-owner Nicole Jacobi in February, they hoped to be open in May or June.

"We'll be lucky if we can open this year, to be really honest," he said more recently.

They get regular emails and questions from customers asking when Ludwig's will open in Mountain View. Bate said he wanted to share what the process has been like not to criticize the city, but to inform the public about what it takes to open a restaurant.

"There are things that are out of our control, unfortunately," he said. "We want it open as much as the people that are asking."

The City of Mountain View did not make any staff available for an interview, despite repeated requests.

Ludwig's is by no means the exception on the Peninsula, where restaurants are routinely delayed by complex city regulations and bureaucratic red tape. The cost of opening a restaurant — before the first customers are even served — has become prohibitively expensive, particularly for small, local businesses owners without the backing of deep-pocketed investors. (In San Francisco, a Board of Supervisors committee held a hearing on Monday to discuss what they could do to address this, including easing the permitting, planning and building processes for restaurant owners.)

Melody Hu, who is working to open a gluten-free bakery in downtown Los Altos, sent an email out to subscribers earlier this month explaining why it's not yet open.

"When I signed the lease for what used to be Mr. Cho's Mandarin Dim Sum, I knew that several things had to change to transform the store into a cute little bakery. But I underestimated the time it would take," she wrote.

Hu took over the 209 1st St. space in early 2019 and planned to open Sweet Diplomacy by this summer. Now she’s hoping for the end of this month but is hedging her bets for October.

"The city's Building Department and the county's Department of Environmental Health both want detailed plans on even minor changes in the store. For the plans, we had to find and create an 'A' team of architect, mechanical/plumbing/electrical engineers, and a good general contractor ... all that took awhile," she wrote. "The plan reviews and final inspections will also take awhile.

"I admire the public safety net that our government agencies have created, and although the process is lengthy to say the least, at the end I think it’s nice to live in a world where most public places are built to a high standard of safety."

In Palo Alto, another restaurant owner is frustrated with what he described as an opaque and drawn-out experience with the city’s planning department. Guillaume Bienaime wants to open a bar in the building next to his 5-year-old French restaurant, Zola, on Bryant Street. He secured through a lottery a full liquor license (Zola serves beer and wine only) and filed the necessary paperwork for a conditional use permit for the next-door space, which was last a hair salon.


The owner of downtown Palo Alto restaurant Zola wants to expand next door and open a bar. Photo by Michelle Le.

Bienaime said there’s been little communication with the independent contractor overseeing his request since then. The city has 30 days to determine whether a conditional use permit application is complete or not; a tentative decision is then mailed to property owners and occupants within 600 feet of the project and becomes final 14 days later unless someone requests a hearing.

City records show Bienaime's application was marked as incomplete in early August, then resubmitted and last “marked as TBD on TBD by TBD.”

"There's nobody who I can go talk to about a timeline," he said. "I'm just completely left in the dark."

Meanwhile, he's paying about $7,500 in rent every month for the empty space.

"If we continue to make it so difficult for local business owners to create businesses within the city or this area in general then we’re going to end up with chain restaurants and chain stores because they're the only ones who can afford to pay through this process," Bienaime said.

Bate and his three Ludwig's business partners, for their part, have been paying rent at the prominent corner space since January. He declined to say how much the monthly rent is. There's also the cost of the architect, engineers and other people who must be hired to comply with the city's requests. Every time the city files comments on Ludwig's plans, their architect must review them and respond.

In San Jose, the plans, permits, building and inspections for Ludwig's were finished in six months. Bate anticipates Mountain View will take at least a year. He's still waiting for building permits to start renovations. (Meanwhile, the building has been put on the market for sale, which the Ludwig's team didn’t know about until recently.)

The timing of the restaurant's opening also impacts the owners' bottom line. With the delays, it's likely Ludwig's, with its outdoor beer garden, will be opening in the dead of winter, its slow season.

Bate suggested that the city create separate planning processes for small and large businesses. It's hard for him to sustain a business through a protracted process, less so for a large tech company or restaurant chain.

"Everyone talks about trying to be pro-small business but it feels like we get treated the same as your Apples and your Googles and your Facebooks," he said. "There's one book for everyone. In this situation, it doesn’t make sense."

They knew they were taking a financial risk expanding to Mountain View but the potential payoff was too good to pass up, Bate said.

"Being on a street like Castro has the ability to pay off in the long run," he said. "We're only 3 years old. To have my brand on that street in a city like Mountain View is massive for me."

Both Bienaime and Bate said they're speaking out not to bash the cities they want to open in, but to hopefully find solutions.

"It's from a place of, we need help," Bienaime said. "It really eats me alive every day. They don't feel any of that. It feels very disconnected from what people are really feeling."

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