Downtown restaurants (and downtown, in general) is not doing well. I think we all know that. Office vacancies are way up (and continuing to rise), parking is getting ever more expensive, the homeless situation is little improved, construction (of state buildings) is ongoing and, of course, restaurants are closing.
I understand the city is in a tough spot. Prior councils spent and committed too lavishly and this budget hole has been looming for years and parking revenue is an easy lever to pull. Construction is annoying, but when done, these new buildings should help support both tourism and more desirable work environs. The homeless situation has proven intractable for most cities and of the options available and we certainly do not want to force the homeless into more residential neighborhoods.
Which brings us to something that has moved into Sacramento’s neighborhoods. Something I would submit is not an entirely undesirable trend.
Downtown restaurants have struggled, there is no question. By the end of 2024, spending at downtown restaurants (defined as those in the 95814 zip code) had just recovered to the levels they were at in 2019Q4, prior to COVID-19’s onset. This is before accounting for inflation. In real terms, spending remains down by 23% over that period.
But, despite the numerous doom and gloom headlines focusing on closures, restaurant spending in Sacramento is actually up. Since 2019 Q4, restaurant spending across Sacramento has grown by 28% (~4% after inflation). The other central city neighborhoods are doing fine, up 26% (~2% after inflation). But the real stars are … everywhere else. Our friends and neighbors took the slogan “Dine Local” very seriously. The neighborhoods were we live are, increasingly, where we are choosing to dine as well. In the rest of Sacramento, restaurant spending is up 43% (~16% after inflation). That is a headline we should be celebrating. Our neighborhood restaurants, overall, are doing pretty well.
Sacramento has always been celebrated as a “city of neighborhoods” and essentially all of our neighborhoods have seen real growth. Oak Park (95817) restaurant spending has more than doubled. Meadowview (95832) spending is up 67%. Natomas (95833, 95834, 95835, 95838) spending is up 63%. East Sac (95819) is up 54%. Land Park (95818,95822) is up 39%. My beloved Pocket neighborhood (95831) is up 35%.
Downtown is important and the city should continue to find ways to make our central city a place where people want to be, a place people want to visit, a place people want to dine, a place people want to play, and yes, a place people want to work. But forcing people to leave their families, spend their time in traffic, their money on parking (and childcare), and their sanity on the unfortunate state of downtown’s current reality is not going to help downtown’s image and it’s not going to generate good will, good vibes, or extra cash to spend on non-necessities. Non-necessities like dining out, whether downtown or in our neighborhoods.
If we squeeze our workers, we will squeeze our restaurants too, both the ones that are struggling and the ones that are succeeding in today’s new normal.
Data provided by the City of Sacramento, with my thanks.
Sacramentality 