Friday, September 29, 2006

Gay workers support anti-gay snuggling policy; or: New Yorker full of it

The American Airlines story just keeps getting weirder.

Apparently there is a website for gay American Airlines employees,

That's not so odd.

What is odd is that Gleam is backing American Airlines in its alleged policy against any gay touching or kissing. They posted an Editor's note on the home page that reads, in part:
The discrepancies between what was reported by the media and the American Airlines' position were of concern to GLEAM. The GLEAM co-chairs have read the New Yorker article and also reviewed crewmember reports and customer communications to try to more fully understand the situation. Our assessment based on the accounts we have read is that the crewmembers acted reasonably.

The New Yorker is highly regarded for its fact checking and accuracy, so any "discrepancies" would be a big surprise. None are specifically outlined by Gleam.

Still, something is off. American Airlines won a big award from Out Traveler magazine, with readers voting it "Gold Standard U.S. carrier for hospitality and service." The airline has the only GLBT-dedicated sales team in the industry. All this according to

Either the airline industry is just burningly, virulently, extremely anti-gay, allowing American Airlines to be the most gay-friendly airline and still have a no gay snuggling policy, or the New Yorker is wrong. Or something big was left out of that story.

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And do you have a reservation for the food court?

A reliable operative writes about the increasingly exclusive seating in the basement of San Francisco's newest mall-strosity, the new wing of Westfield's San Francisco Centre:
The rush on the tables has the security guards giving diners the bum's rush - happened twice to me now.
That's right -- there's now a defacto velvet rope across the mall food court, traditional home of the Orange Julius and Hot Dog On a Stick.

I'm definitely asking Tom Colicchio about this next week.

But in the meantime: People: grab hold of your senses. There are other restaurants out there. Just like there were before the biggest mall-builder in the country opened yet another in downtown San Francisco and filled it with spinoffs of other, more original restaurants.

I'm not saying it ain't tasty. I'm not saying it ain't worth a visit. I'm just saying, there is no need to get mall security involved, possibly ending up handcuffed and crying in the back of a Sbarro.

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Monday's starry morning

Michelin will unveil its San Francisco star ratings Monday morning, 10 am.

I write on the Business Times website that this could threaten Michael Bauer's preeminence as an arbiter of taste in the Bay Area.

Roland Passot of La Folie doesn't think so, saying the Guide will still take a back seat to Bauer. But he admits "I'm kind of a nervous wreck ... I think everybody is kind of nervous." Apparently Michelin hasn't let the chefs in on the rankings, even to spare them the agony of anticipation this weekend!

In New York, people initially thought the Michelin rankings were freaky weird. Gawker wrote:
Everyone who even tangentially cared got their cloth napkins in a twist over it. Too French! Too elitist! ... The Spotted Pig?! Jean-Georges better than Daniel?! Oh, people were angry."

New York magazine:
The book, everyone eagerly agreed, was quirky, off-key, and almost comically Francophile. Three stars for Alain Ducasse?! “Ducasse is the Abba of haute cuisine,” one of my food-writer friends sniffed. According to Michelin, one of the very top brasseries in New York is an entrenched Madison Avenue establishment called La Goulue. “La Goulue,” said another incensed food friend of mine. “My grandmother doesn’t even go to La Goulue!”
But, as it turns out, Michelin has become uniquitous. A simple keyword search on or reveals the prevalent use of "Michelin Man" as an honorific and star ratings dropped like nobody's business.

Many chefs -- Bay Area and otherwise -- no doubt remember Bernard Loiseau, the pioneering French chef who came to care far too much about his Michelin stars and eventually took his own life.

Perhaps the biggest question here is how Chez Panisse will do. It is not a three-star restaurant by traditional Michelin standards. But it has set its own standards, standards that have come to all but rule the regional culinary scene and marked a key turning point for food around the world.

If the New York rankings were Francophile, that does not bode well for the house that Alice Waters built.

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Thursday, September 28, 2006

New Beard Papa's to open in Rest Room of existing Beard Papa's

I knew Beard Papa's was going into the new wing of San Francisco Centre back in June, when I wrote about the local franchises of the Japanese chain.

But untill today, reading the bazzilionth roundup of Centre restaurants in tablehopper, the full absurdity of the location did not dawn on me.

Beard Papa's debuted in San Francisco on Mission Street and Yerba Buena Lane, about half a block from Fourth Street. The second local location is going in to the Centre's expansion on Mission toward Fourth -- less than a block away.

Of course, if you eat enough cream puffs that can start to seem like quite a distance.

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'I'm not made of money -- swim toward Oakland.'

The Oakland Tribune stretchhhhhhhes reality with the headline
East Bay on rise as destination for international travelers.
The only evidence for this is a statement from someone at the Berkeley CVB.

The story is well reported and shows why some international visitors like the East Bay, but it does not support the headline.

The numbers you won't find in the Trib's story: passenger tallies at Oakland International declined by 110,000 for the first seven months of this year to 8.4 million, which I am guessing is due to higher fuel prices.

This didn't keep "Oakland/East Bay" hotels from lifting business a bit. Their revenue per available room rose $7 per room per night to $69 through July, according to PKF Consulting. In the same period in San Francisco, revenue per available room rose $12 to $125.

Maybe people are landing at SFO, where international passenger counts are up 170,000 to 4.9 million through July, and venturing into Oakland. But we just don't know, and I have not yet heard of this happening from anyone (as someone who covers both hospitality and Oakland for the Business Times). It seems more likely that international visitors would go to wine country with their spare time, unless they landed directly in Oakland.

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Wednesday, September 27, 2006

Perfect opportunity to write 'Dirty Laundry' headline missed

Why do people always forget Thomas Keller has a restaurant in Las Vegas?

People remember the French Laundry, Per Se, and, slightly less often, Bouchon in Yountville. But people are either surprised or doubtful when I tell them that Keller, too, has joined the Las Vegas cash-fest. His entry is Bouchon Las Vegas.

Anyway, apparently Keller's video uplink connecting Per Se in New York to French Laundy in Yountville via 32-inch plasma TVs is going to be getting quite a workout: Keller has split with his 10-year director of operations and "life partner" Laura Cunningham, the Chronicle's Inside Scoop reports.

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Waiters leapt for $6,000 tipper

A juicy story in October's San Francisco Magazine details the restaurant largesse of convicted embezzler Carol Huang.

Or, as they call her at Chez Panisse, "Berkeley's Robin Hood."

Huang jacked more than $11 million from Edward Scarff by secretly mortgaging his house, cashing in his life insurance and taking out business loans in his name. Scarff is supposed to be enjoying his retirement, but instead he's now bankrupt.

Some East Bay restaurateurs still hold Huang in high regard, however. Former Chez Panisse maitre d' Lee Ann Philips told the magazine that Huang, who dined at the high-minded restaurant before and after her embezzlement came to light, was dubbed "Berkeley's Robin Hood" by Chez Panisse staff. Quoth Philips:
You have no idea how much she did for people, how many lives she changed.
Well, Lee Ann, we can imagine. Especially after reading Gordy Slack's article.

After a 50-head, $6,000 dinner at Oliveto, Huang not only paid the $1,000+ service charge but also distributed checks of $800 to $1,000 to three waiters and "several" people in the kitchen. The checks aroused jealousy, and one waiter resigned. I tally at least $6,000 in tips from this one meal.

She once wrote an unidentified waitress, a single mother, a check for $8,000.

Her reputation at Chez Panisse was such that "the normally unflappable waiters would jockey for the chance to serve Huang." We don't get numbers on her tips there, but they can be imagined. Consider that a wedding bartender -- catering staff -- once netted a $400 tip from Huang, without even meeting her.
"It made me kind of sick, the effect she had on people. It was ugly," says Elaine Smith.

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Tuesday, September 26, 2006

Must. Not. Interact. With. Other. Humans.

Get-rich tip: Figure out when robots can deliver better service than humans.

A couple of weeks ago I wrote about how the St. Regis hotel in San Francisco now allows guests and residents to issue service requests over email. Hotel "butlers" receive their orders over handheld emailers.

The local Ritz-Carlton and Four Seasons pooh-pooh the idea, saying human conversation is the only way to initiative truly excellent service.

But don't humans sometimes get in the way of optimal service, what with their language differences, misunderstandings and moods? Last night, New York Magazine's Grub Street blog reported on a service not unlike the St Regis': "Mobo," which lets you order lunch via text message from your cell phone:
We ordered a small "Newman" pizza on our phone, via text message, while walking over that way. And sure enough, the food was waiting for us at pickup, already paid for.
Of course, it takes about 10X as long to tap out a text message as it does to actually call the friggin' restaurant. But then you'd have to talk to another human being.


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Monday, September 25, 2006

Picketing the pate

No sooner did San Francisco's hotels settle their two-year-old union dispute than a new group of picketers readied themselves for battle in the foodie court at Westfield's Emporium redevelopment.

When the new wing of San Francisco Centre opens later this week, it remains a distinct possibility that members of a union affiliated with the hotel union will be on hand to picket the centrepiece (cough) attraction, the 30,000-square-foot gourmet grocer Bristol Farms, a kind of Southern California version of Draeger's Markets.

As a redevelopment project, the mall has pledged to allow union organizing. What that means, exactly, is unclear. What is known is that Bristol Farms is a non-union shop in the crosshairs of the United Food and Commercial Workers Union.

Linkage: Matier and Ross reported the story Sept. 20, CBS5 picked up the item, and Sunday SFist mentioned the dispute in its Emporium roundup.

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Diagnosing dining

I received an interesting email last week about my Friday Business Times piece on the would-be Oscars of dining (subscriber-only link for next three weeks: Oscar sits down to dinner).

The writer disagreed that San Francisco is lacking in high-profile restaurants compared with several years ago. The closure of Stars, Cypress Club and Redwood Park after the dot-com bubble burst had more to do with poor management than macro trends, he said.

There's some truth in that point -- the examples I picked may not have died due entirely to dot-com issues, maybe not even primarily. But it's hard to argue there was not a major impact from the dot-com downturn. At the very least, it pruned restaurants that had been propped up by dot-commie expense account business.

After all, the city lost a net 228 restaurants in the last six months of 2001, according to a widely quoted study from the Golden Gate Restaurant Association.

Interesting story about those numbers, though. They are sourced to the Department of Public Health, which licenses restaurants. They tend to wax and wane. I pulled some in 2003, trying to update the GGRA's 2001 numbers. The department told me they pull together reports on an on-demand basis, meaning there are no regular reporting periods. So basically it's tough to do comparisons -- you can say how many restaurants opened or close in a particular period, but can't readily compare to the same period in prior years. So if you're looking at six months of data, you may be looking at seasonality.

My 2003 article looked at one full year of statistics, and found a net 127 restaurants had opened in San Francisco. But it was still flawed, because it did not state how many restaurants had opened or closed the year before that or the year before that. What if the net gain of 127 was compared with net loss of 400 the prior year?

Bottom line, no one really has good data on the financial state of the restaurant industry at any given time. The hotels report hard numbers into PKF Consulting and Smith Travel Research, but restaurants have no such statistical aggregators. Credit card companies like Visa could probably put together some good data but do not part with such information.


Friday, September 22, 2006

Zagats fight over check in front of Bauer

On the off chance you're not already reading Chronicle food editor Michael Bauer's blog, he reports today that Tim and Nina Zagat got into a possibly-bitter tipping fight right here in San Francisco: Tim tips after tax, Nina pre-tax.

No word on whether any wine was thrown, slaps delivered or where the spat took place. (Yes I'm reaching here. Work with me.)

Fighting over methodology weeks after the guidebook is put to bed. These are our tastemakers, people. (At least until the Michelin guide comes out next month.)


Oakland: the knives are for more than stabbing

There's a fascinating restaurant boom under way in Oakland.

Specifically, in the Uptown district of downtown Oakland, which is stealing some thunder from Rockridge, the upscale Oakland neighborhood that long ago earned its foodie stamp with Oliveto.

I report in today's Business Times that Belgian-themed bar and restaurant Luka's Taproom is planning to open a wine bar right across Broadway from its existing location. This comes directly from the owner of Luka's, Rick Mitchell.

In the days since I wrote that article, I have heard that three San Francisco restaurants are looking at making the leap into Uptown. I can't think of this ever happening before with restaurants of this caliber -- two are three Chronicle stars, one is two-and-a-half, and all are A-list in terms of street buzz.

It's worth noting that when San Francisco magazine in August named the top 10 new restaurants of the past year, two were in Oakland (Tamarindo in Old Oakland and Pizzaiola in Temescal) and one was in Berkeley (Sea Salt).

Existing East Bay stars are clamoring to get into Uptown, including (as previously reported ad nauseum) the team behind Dona Tomas and Tacubaya and, allegedly, a three-star Oakland restaurant who I am not naming yet.

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Gay snuggling ban from SFO's second-biggest airline

Extraordinary story out of this week's New Yorker: an American Airlines stewardess and purser stopped two gay men on a flight from Paris (!) to New York from kissing or touching:
Shortly after takeoff, Varnier nodded off, leaning his head on Tsikhiseli. A stewardess came over to their row. “The purser wants you to stop that,” she said.

“I opened my eyes and was, like, ‘Stop what?’ ” Varnier recalled the other day.

“The touching and the kissing,” the stewardess said, before walking away.

Tsikhiseli and Varnier were taken aback. “He would rest his head on my shoulder or the other way around. We’d kiss—not kiss kiss, just mwah,” Tsikhiseli recalled, making a smacking sound.

The two men were later reprimanded by the airplane captain.

What's more, American Airlines is officially standing behind its no-gay-snuggling policy with an official spokesman telling the New Yorker:
Our passengers need to recognize that they are in an environment with all ages, backgrounds, creeds, and races. We have an obligation to make as many of them feel as comfortable as possible.

American Airlines is the second-busiest carrier at SFO, with 8 percent of landing weight, ranked behind United with 42 percent. Interestingly, it is a corporate sponsor of the Billy DeFrank LGBT community center in San Jose and has a corporate non-discrimination policy on "gender identity or expression," according to Equality California, a gay rights group.

Living and working in San Francisco, it can be easy to forget the city is way ahead of the curve on gay rights. Local hospitality companies Joie de Vivre, Kimpton Group and Personality Hotels go out of their way to embrace the LGBT community. And it is hard to imagine a restaurant in this city that would dare institute a policy like American Airlines'.

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Thursday, September 21, 2006

The eternal wait for big expense accounts

I had lunch today at Cafe Bastille with two hotel money guys.

They explained, to my surpise, that investors are lining up to buy hotels in this city at aggressive prices. Around the start of the year, several hotels traded in rapid succession, including the Four Seasons, Argent, Park Hyatt, Pan Pacific and St. Francis.

Apparently more deals are on the way. And prices are still in nosebleed territory.

I pointed out that, if anything, money to finance these deals should be harder to come by than it was nine months ago given interest rate trends and the price of the 10-year Treasury bond, which has added half a percentage point of return over the last year.

Then they said something funny. The deals aren't being driven by the fundamentals. The cap rate, or annual return on investment, for some deals looks to be below 4 percent. In other words, you could buy 10 year U.S. Treasury bonds, now at about 4.6 percent, and get more bang for your buck.

How do you justify a risky hotel purchase that earns you less than bonds guaranteed by the U.S. goverment?

By drawing a line that goes up and to the right.

Hotel buyers are projecting that hotel revenues will rise sharply, boosting that return. For the first five months of this year, revenue per available hotel room in San Francisco was up $13 to $120 -- more than 10 percent. If another round of aggressive deals emerges as predicted, sales will need to rise further.

I just don't understand how that can happen. Revenue gains the past three years were driven by modest but steady growth in tourism, including a big spike in international travel. Foreigners are coming due to the weak dollar and economic recovery in Japan. U.S tourists are shaking off 9/11 jitters and spending money thrown off by steady economic growth.

Then there are the conventions, which have been especially strong the last three years.

But the dollar is strengthening, the convention cycle at a low ebb next year and sources of further domestic tourism growth uncertain. San Diego is putting pressure on the city for future conventions. More hotel capacity is coming online with the 550-room Intercontinental now under construction, plus two new fractional ownership hotels from Ritz-Carlton and Fairmont.

That leaves the business traveler as a source for growth -- the people with fat expense accounts. They're the last major group of visitors who still haven't returned to the city.

And everyone is chasing them. The return of the big expense account is needed not only to justify high hotel prices but also flagship restaurants. Pat Kuleto's $18 million restaurants, with 400 seats between them, will have a hard time selling enough steaks and exotic fish to tourists and locals alone, no matter how many condo units go up on nearby Rincon Hill.

The convention and visitors bureau wants more flagship restaurants to stoke tourist growth, but as Michael Dellar told me it's hard to launch a flagship restaurant when you aren't selling to the fat crowd of expense accounters you have in New York or the drunk gambling money you have in Las Vegas. I guess he's crossing his fingers there will be enough business at the steakhouse he's opening in Westfield's Emporium redevelopment.

New York has expense accounts in its restaurants and businessmen in its hotels because of banking and media. Those are social, deal-driven industries. You need face-to-face meetings. If you're a local, that means frequenting restaurants. If you're from out of town, it means you need to fly in to close transaction.

San Francisco was a banking powerhouse in the 80s but the industry has been waning. Bank of America was acquired and large numbers of staff moved to North Carolina. Robetson Stephens closed. Charles Schwab's recent history has been a tally of successive layoff rounds.

The only real media biz in San Francisco was confined to the dot-com days, when the city was teaming with advertising-driven startups that are long gone, CNET not withstanding.

Will the business executives of San Francisco's future eat out more? Not likely. What are the growth industries? Biotech, digital entertainment? I don't buy it. The biotech guys can do their jobs in their labs, heads down. The key communication takes place using hard data in methodically assembled journals or tightly-controlled formal data sharing between organizations.

The digital entertainment guys, like Wild Brain and Giant Killer Robots, are not Hollywood moguls. They have polygons and server farms instead of actors and agents. A programmer living off ramen noodles can have more impact than a well-connected producer. I'm not saying they don't eat out -- I'm saying they don't need to eat out to do their jobs.

That's why the expense account is not returning to this city, as much as I wish it were.

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Outsourcing: the new small plates?

Daniel Scherotter, chef-owner of Palio d'Asti in the financial district, was serving the single best dish at the Golden Gate Restaurant Association's fundraiser last week: mini cupcakes from his new pastry chef. There were about four different flavors, including tiramisu, chocolate, lemon/ginger, none of which I am doing justice.

Danny believes restaurants are going to need to outsource more and more non-core foods as costs rise due to the escalating minimum wage, mandated health care spending and the new sick leave ballot measure (9 days a year with very lenient notification requirement for employees, or so the GGRA says).

This is why he hired his new pastry chef, Mimi Young of Scala's. The idea is to start selling pastries to as many other restaurants and caterers as possible.

Danny sees it as the next logical step. Once you have Acme supplying your bread, Paul Bertolli selling you local gourmet sausages -- why make your own desserts?


Reporter promotes self; film at 11.

In my rush to write about 7X7's food blog I neglected to introduce the site.

I write about the business side of restaurants and hotels at the San Francisco Business Times.

This blog, Covers, will focus on the business side of restaurants and hotels. The money. The deals. The players in the back of the house.

You can read more about me on my personal Web site or check out some past articles, like:
Over the years I have been the first to report on Slanted Door's move to the Ferry Building, Supper Club coming to town, Ame going into the St. Regis, a gourmet food hall opening next to Chez Panisse, Dona Tomas expanding to downtown Oakland and Tamarindo and B's coming in to Old Oakland. On the hotel side, I was first to report the sale or listing of the St. Francis, Park Hyatt, Argent, Pan Pacific (twice) and Sir Francis Drake hotels, among others, and about Joie de Vivre's expansion to Los Angeles.

Yadda yadda yadda -- that's me. Onto the next post! Check back soon, or better yet sign up for the feed.



7X7 magazine is preparing to launch a bunch of blogs, including more than one focused on food and restaurants, someone familiar with their plans told me at the Golden Gate Restaurant Association's annual political fundraiser last week. Susie McCormick, 7X7's publisher, confirmed for me that something along those lines is coming from the magazine, but she won't give any details yet, saying it's premature to talk about.

It's a crowded market. Amy Sherman, who I spied at the fundraiser, is blogging for KQED. Chez Pim recently started blogging full time. GraceAnn Walden, recently decamped from the Chronicle, publishes an email newsletter. And then there's Michael Bauer, publishing a very solid blog for the Chronicle.

But I wouldn't count Susie out. Her ties to the restaurant industry are deep, dating back to her days at the helm of SF Magazine and Where Magazine. Even further than that, actually: her first husband was the McCormick of McCormick & Kuleto's.

And New York Magazine, 7X7's peer in Gotham, has done very well with its Grub Street food blog, earning kudos from even the snarks at Gawker.

PS: I've got a big article coming out on something else related to Susie and restaurants in tomorrow's Business Times.

Wednesday, September 13, 2006

Honored by publicity club

2006 Pubby Award

The San Francisco Bay Area Publicity Club has named me "Best Bay Area Business Reporter" at the 2006 Pubby Awards (see the nominees). Thank you!