Despite a Slew of Closings on Valencia, Some Restaurant Owners Remain Optimistic

Nick Anichini, the former chef de cuisine of the Michelin-starred Atelier Crenn, co-opened the much-anticipated Ancora at 557 Valencia Street in July 2022. It’s a well-known street in San Francisco, the kind of sprawling shopping and dining promenade where you can eat anything from pupusas to vegan sushi to pizza while shopping for indie comic books, designer clothes, or even pirate supplies.

Anichini remembers the first time he saw the Ancora space. The street was shut down to vehicular traffic between 16th and 17th streets thanks to a short-lived Shared Spaces program that ran intermittently from 2021 to the end of 2022. It brought thrift clothes-sellers, artists, and musicians to the block. “There was heavy foot traffic,” Anichini remembers. “It put a mask over what it was really like.”

Just five months after opening the restaurant went dark. Anichini and his team called it quits as those buzzy summer fairs gave way to empty sidewalks during the fall and winter. The Shared Spaces program ended, though a similar program called Sunday Streets returned to the corridor on July 10.

Patricia Chang

While the severity of the pandemic’s impacts on the restaurant industry may never be fully understood, many areas in San Francisco have started to bounce back. North Beach is in what some call a renaissance, led by restaurants such as Cassava, which debuted a splashy new Columbus Avenue location in October 2022. A long-vacant corner of Fillmore and Post streets is now home to thunderously popular Copra, giving a bump to both the Fillmore and Japantown.

But Valencia Street, once one of the city’s hippest and buzziest strips, feels tired. A plot of rubble now lies where Irish bar standard the Phoenix held court for 63 years, and on March 14, Pi Bar went dark after 13 years near Buena Vista Horace Mann Elementary. As of June, Luna restaurant near the corner of Valencia and 18th streets shuttered — only about six months after debuting a renovated space and menu.

Still, some business owners and members of the Valencia Corridor Merchants Association — including Karen Ruelas of Sisters Coffee Shop and Jorge Martinez Lillard of Loló — remain optimistic. It’s better than it was six months ago, they say — and they’re hopeful it’s only going to get better.

Photo by Smith Collection/Gado/Getty Images

The Mission District, a predominantly Spanish-speaking community, is home to many intergenerational families from Latin America, South America, and Mexico — some who have been living in the area since before California became a state. But Valencia Street has, in recent years, become disconnected from that history, now often associated with the gentrification of the city during the past two decades.

As summer 2023 sets in, Mission Local reports the neighborhood has the most outdoor parklets of any area in the city, and a Valencia Street bike lane is now fully operational. On the other hand, Korean restaurant entrepreneur Ina Jungin Lee moved her popular Korner Store restaurant off of Valencia Street due to increasingly raucous parties — a sign of business health rather than decline. After 28 years, naturopathic goods store Scarlet Sage abandoned the corridor in search of cheaper rent. Third Culture Bakery made it less than seven months before closing, and co-owner Wenter Shyu cited issues with unhoused individuals in the neighborhood, as well as increased rent, as reasons for the closure.

The office of San Francisco Board of Supervisors member Hillary Ronen commissioned a report that found that between April 2020 and December 2020 somewhere between $172 and $404 million in rent went unpaid by commercial tenants, with a disproportionately high percentage of that coming from tenants in mixed-use buildings. The Mission District has the highest number of mixed-use buildings in San Francisco, according to the report. During the Great Recession in 2009, there were only 11 vacancies on Valencia Street, but in 2021, there were 20; today the number of vacancies remains high, as one can see just by walking the corridor. In short, if there’s an area that remains deeply impacted by COVID outside of much-discussed downtown, it might be the Mission District.

Anichini, for his part, was thrilled to open on what he thought was a busy street. But after opening, it became apparent Ancora wasn’t destined to be a neighborhood restaurant — there weren’t many walk-ins. Across the street, he says, Blondie’s and other longtime restaurants remained popular, even at night; it just didn’t translate to sales for Anichini’s new restaurant. “It’s a collection of pandemic and post-pandemic things,” he says. “I was opportunistic about it. But [Valencia Street] is just not what it used to be.”

Across the street at West of Pecos, owner Tyler MacNiven says he’s thankful to have weathered the winter that took out Ancora, noting that cold months tend to limit foot traffic and tourism — the lifeblood of businesses in the neighborhood. Still, the West of Pecos Cinco de Mayo party in mid-May was the busiest day in the restaurant’s 11-year history, according to MacNiven. The team brought in a mechanical bull, cranked out tacos day and night, and merchant association president Manny Yekutiel emceed. “If we’d had this conversation six months ago,” MacNiven says. “I’d be staring into the distance listening to Sounds of Silence, tears streaming down my face.”

Many business owners were reluctant to go on the record about rent prices in the neighborhood, however. The high cost of space in the area is a factor contributing to the challenges Valencia faces in maintaining its unique mix of businesses and identity. Sean Quigley, who runs 31-year-old taxidermy and quirky items shop Paxton Gate, points to landlords’ disinterest in lowering rents as an issue. When he moved to the neighborhood in the 1990s, he remembers Valencia looking as vacant then as it is now — but he says that emptiness attracted the artists who helped the neighborhood flourish into what it is today. He’d like to see the city charge steeper vacancy taxes — currently about $250 per linear foot for commercial properties — which could allow for a realistic rental adjustment in the area. If that happened, he feels like things could move in the right direction. “We’ll see a Valencia renaissance bringing back the ma and pa shops,” Quigley wrote in a text. “Artist-run new ventures, and more. It’s an opportunity, not a death sentence.”

Ritual Coffee Roasters

At Ritual Coffee just a few blocks east, Eileen Rinaldi is getting more and more people in her coffee shop as the pandemic shutdowns of 2020 and their immediate impacts move into the rearview. “During deep COVID, people weren’t comfortable doing that,” Rinaldi says. “It’s lively inside the cafe right now.” The longtime coffee shop is back to hosting art openings — during which 50 to 100 people sometimes line up for group shows — and remote workers, just like before the pandemic began. Rinaldi feels the rebirth Quigley mentioned is just around the corner; she, too, arrived on the scene in the late 1990s and feels there’s a cyclical nature to the city. When she opened in the early aughts, it felt like the same precipitous time on the street as now — a positive, quiet moment ripe for innovation.

It was during one of those quiet moments that Mexican restaurant Tacolicious opened on Valencia Street. Sara Deseran has run Tacolicious in the Marina since the summer 2009 and in a permanent space on Valencia since 2012. Deseran says things are certainly up and down these days. She points out that lunch on Valencia Street, broadly speaking, is no more. She’s trying to amp up her own lunchtime offerings, adding items such as a cauliflower and quinoa bowl meant to be friendly for third-party delivery — a large portion of sales at this location these days. “Dining habits have changed significantly because of the pandemic,” Deseran says. “Now we have to think about delivery as so much of our sales have shifted.”

She’s lived in and around the Mission since 1996 and has always seen the Marina as an example of where the local residents interact with chains and small businesses to drive traffic. Locals go to the Apple Store for iPhone repair, or swap their jeans at Madewell, then hang out to get coffee and lunch at a locally owned restaurant. “In the Mission,” she says, “it has to be one or the other. And the city doesn’t support either.” It’s a city with hurdles for business owners across all 48 hills, she adds, but the Mission has struggled thanks to its sheer size and high rents. “The Mission is two miles long,” Deseran says. “As much as I understand why the Mission is remiss to support change, I think at this point it is time to rethink how we do business.”

Anichini agrees that the city is indeed in a tough spot, and that trends like a decline in lunch sales writ large in San Francisco impacted Ancora. He says places like House of Prime Rib and three-Michelin-starred destinations might be more insulated from these issues thanks to well-heeled and longtime fanbases, but most every other business and area in the city is feeling the weight of the pandemic’s impacts. Mass layoffs at big tech companies that supported small businesses don’t help.

At a Valencia Corridor Merchants meeting in mid-May, Rinaldi says she felt a sense of hope from other business owners. Fellow merchants association member Yellow Moto Pizzeria just opened for business on Mondays and, hopefully, Sunday Streets will shut down the corridor again come July. Plus, new gelato and coffee shops Hila and Outset Coffee, respectively, just opened in June. “People are optimistic,” Rinaldi says. “We’re such a part of the DNA of the neighborhood. We’re just going to grow and adapt.”

Correction: July 24, 2023, 11:03 a.m. This article was corrected to show that Paxton Gate has been open for more than 30 years.