Bay Area restaurateurs are flocking to Sacramento region
By Jon Ortiz - Bee Staff Writer
Published 12:00 am PDT Wednesday, May 2, 2007
Story appeared in BUSINESS section, Page D1
The waves of well-off Bay Area transplants who came here for cheaper homes and a slower lifestyle have sparked a second migration: restaurants.
Drawn by the Sacramento region's growing wealth and emerging night life, restaurateurs from San Francisco and its environs are targeting local hot spots with the promise of more choices for local food fans -- and more competition for homegrown operators.
In the last year, at least a half-dozen small restaurants with Bay Area ties have opened here, and at least that many will open locally by the end of this year.
Outside operators say they are feeling the pull from downtown Sacramento's food and entertainment culture and the region's explosive growth, particularly in Roseville/Rocklin and Natomas. They're also being pushed by higher costs in San Francisco that many say make opening a restaurant more expensive than ever.
"You have these two things moving on parallel tracks," said Tim Stannard, who recently added a new Granite Bay Pizza Antica restaurant to the three he owns in the Bay Area. "New mandates in San Francisco and this huge population shift into the Valley. That makes people like me sit up and pay attention to the Sacramento area."
There's no question the influx of Bay Area migrants is transforming the region. Take Placer County. From 2001 to 2005, more than 28,000 people moved in from the nine-county Bay Area, federal tax data show. Their average household income: $84,000.
"So many people here seem to have relocated from the Bay Area," said Molly Hawks, a former San Mateo resident who is opening Hawk's, a white-linen restaurant, in Granite Bay this summer. "But we kept hearing that they missed the kind of small upscale restaurants that are common there."
Randy Paragary, owner of nine area restaurants, acknowledges that competition is ramping up, driven by what he says is a growing sophistication among owners jockeying for discerning diners.
"You see it in new restaurants' menus, the investment going into everything from more beautiful fabrics to better lighting and upscale architecture," Paragary said. "People around here who have been in the business a long time have stepped it up."
Roseville restaurateur and real estate developer Abe Alizadeh exemplifies the trend. Once content to run his Jack in the Box empire -- he owns 71 of the fast food outlets -- Alizadeh recently opened his upscale Crush 29 on Eureka Road.
"The restaurant market in the region is evolving," Alizadeh said during a recent lunch rush at the restaurant and wine bar. "Sacramento today is not the Sacramento of 20 years ago. It's more culturally mature. The customer is more informed."
In Sacramento's outlying areas, the emerging restaurant scene can trace its spreading roots to the Bay Area-fed housing boom and the sense among deep-pocketed national chains that those areas were underserved, said Heath Kastner, a commercial real estate broker for CB Richard Ellis.
The midlevel national chains tested the suburban markets first -- T.G.I. Fridays, Chili's and the like. Then Cheesecake Factory Inc., based in Calabasas Hills, set up shop three years ago at Arden Fair. A year later Orlando-based Ruth's Chris Steakhouse opened in the Galleria and at Pavilions on Fair Oaks Boulevard.
In Natomas, the Walnut Creek-based Dudum Sports & Entertainment and NBA star Chris Webber teamed up for Center Court with C-Webb, a basketball-themed Natomas restaurant that opened in November.
"People from the Bay Area see all that," Kastner said. "They're seeing the volume of business being done, the hour wait times in Roseville and Natomas, and say, 'Hey, I want a piece of that.' "
Buckhorn Grill, owned by John Pickerel of Winters, opened its first Sacramento location this year, but only after successes in San Francisco, Napa and the East Bay. Santa Rosa celebrity chef Guy Fieri recently opened his second barbecue and sushi hybrid, Tex Wasabi's, on Arden Way.
While many restaurateurs are picking off spots in outlying areas, central Sacramento continues to whet appetites.
According to statistics compiled by the Downtown Sacramento Partnership, 29 restaurants have opened in the area between the Capital City Freeway and Old Sacramento since 2005. Another 12 expanded their operations. Paragary and others have new concept restaurants in the planning stages.
A year ago, Stannard, the Pizza Antica owner, decided he needed to break into the Sacramento market after visiting the Wong family's restaurant/nightclub complex on 15th and L streets, The Park Downtown.
"The place was beautiful, and packed with young, affluent, sophisticated people with money to spend, all having a great time," Stannard recalled in a recent phone interview from his San Francisco office. "I thought, 'This place could be anywhere -- San Francisco, L.A., New York. Who wouldn't want to be here?' "
Karl Hasz, a San Francisco developer who scouts restaurant locations for clients, is telling them the Sacramento region is primed for more business. He points to The Park, Dennis Fong's 16th Street Mikuni sushi restaurant and what he calls midtown's "blossoming night life" as proof of the market's possibilities.
Hasz and others admit the area has many successful, high-quality restaurants. But "there's plenty of room to grow," Hasz said. "It will take years to fill it up."
Another plus: It takes less money to do business here. Construction costs and rents in San Francisco, for example, run two times to three times those in Sacramento, Hasz said.
San Francisco is particularly tough, with a higher minimum wage -- $9.12 per hour vs. the statewide $7.50 standard -- and a recently approved universal health care plan paid for, in part, by mandated employer contributions. The Golden Gate Restaurant Association has sued the city to halt the employer mandate.
"Those kinds of things just make it harder and harder to grow in San Francisco," Stannard said. "So you get inspired to look elsewhere."
Stannard's Granite Bay Pizza Antica opened in February, joining his others in Lafayette, Mill Valley and San Jose. The restaurant combines the formal -- a black and white décor and cloth napkins -- with casual touches like its tile floor and open kitchen. The most expensive menu item is an $18.95 steak.
The restaurant, which seats about 100 indoors and another 50 or so on a waterside patio, was nearly full on a recent Thursday night. Stannard says the Granite Bay operation has "picked up traction right out of the gate," and that he is looking at other local sites, including downtown Sacramento.
"We think that this trend of revitalization, even grittier parts of downtown and midtown, isn't going to stop," Stannard said. "Sacramento is climbing demographically, and we think it's a trend with no end in sight."
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