When Baking and Real Estate Collide

Tartine, a world-renowned bakery and San Francisco institution, opened in 2002, on an unassuming corner of Guerrero Street, at the edge of the Mission District. The dot-com bubble had recently burst, and the city was in a period of transition. The median rent for a two-bedroom apartment had fallen from three thousand dollars a month to just under two thousand. Development had slowed, evictions and unemployment had spiked, and commercial vacancies had risen. In the Mission, a historically working-class and Latino neighborhood, artists’ spaces battled with real-estate developers. Tartine’s neighbors included a used-furniture store and a community center. The storefront, which had previously housed a cake shop, came with a panic button.

The bakery didn’t have prominent signage and didn’t need any: almost immediately, people began lining up out the door for citrus-perfumed morning buns, billowing banana-cream pies, and loaves of custardy millet-porridge bread. The bakery garnered praise from Martha Stewart and Alice Waters and made the cake for a “bohemian bourgeois”-themed birthday party attended by Nancy Pelosi and Hillary Clinton. Its married founders, Elisabeth Prueitt and Chad Robertson, started to become food-world celebrities: Prueitt was admired for her elegant pastries and, later, her artful use of nontraditional flours, and Robertson for his approach to bread-making, with wet dough long-fermented, then prepared by hand according to a strict schedule. Tartine’s loaves almost always sold out within the hour. In the pre-Yelp, pre-iPhone, pre-cronut era, waiting in line for baked goods was unusual in the Bay Area, and the queues outside Tartine became a local landmark and a symbol of a changing city. “Our favorite thing about this bread-rich city is the chewy-crusted, nutty-crumbed pain au levain from the Mission’s new Tartine,” Gourmet wrote. “Get in line,” the San Francisco Chronicle reported. “Everyone else is.”

Prueitt and Robertson radiated a particular kind of Gen X bohemianism—dedicated, ambitious, and breezy. Aspiring chefs and bakers travelled across the country to work with them. The bakery brought on a fleet of young and beautiful artists, musicians, and writers to work the front of the house, and for a certain set of locals the “Tartine girls” were a draw. The café, with its sturdy, dark wood bistro tables arranged knee-grazingly close, took on the qualities of a clubhouse, with bakers, baristas, and servers playing their own music on the stereo, hanging out after their shifts, and enjoying free glasses of “shift wine” from uncorked bottles. Samin Nosrat, then a fledgling chef, hosted ticketed dinners at Tartine; concerts and monthly art openings included works by employees, and one bread-themed show featured a bread chandelier that lightly toasted itself as it luminesced. “It was just the crux of the Mission for me,” Rachel Corry, a sandal-maker who worked at the bakery for nine years, told me. Another employee said, “It wasn’t a professional place to work, but that was what was so great about it. Our friends were our bosses. It was like a dream time, a pretend time.”

In 2005, Tartine began a small-scale expansion. Prueitt and Robertson opened a nearby restaurant, Bar Tartine, which was praised for its inventive, sophisticated take on Japanese, Scandinavian, and pan-European cuisine. They were nominated for James Beard Awards and published a celebrated cookbook. Prueitt gave birth to a daughter who has cerebral palsy, and co-founded the Conductive Learning Center of San Francisco, a specialized nonprofit school for children with motor disabilities; she continued to run Tartine’s pastry program, and in 2008 she and Robertson won the James Beard Award for outstanding pastry chef.

A decade on, “artisanal” breads and bakeries were popping up everywhere. San Francisco was rebounding, and the process was soon to accelerate. In 2012, Facebook went public, and the median rent for a two-bedroom shot back to nearly three thousand dollars a month. Activists started blocking the paths of double-decker shuttles run by Google, Facebook, and other companies, which picked up tech workers at public bus stops. Facebook bought WhatsApp and Oculus, Google bought Nest and DeepMind, Amazon bought Twitch, and the minting of new millionaires accelerated. By 2014, the median rent for a two-bedroom had passed thirty-seven hundred dollars. Some of Tartine’s staff members faced rent hikes or were threatened with eviction. “It really felt, like, Ugh, are we just working at the Disneyland for Google employees?” Katie Lally, who was at Tartine from 2007 to 2011, told me. She recalled a customer who’d ordered in tech-gadget lingo: “What’s your sexiest pastry? What’s the thing everybody wants?”

Tech was booming. Rents were skyrocketing. Tartine had thrived during an economic downturn. Now it was operating in one of the most expensive cities in the world. In Silicon Valley, startups were following a new business rule: grow or die. But how much was it possible for an artisanal bakery to grow?

In 2014, Prueitt and Robertson started work on a restaurant, café, and ice-cream bar called Tartine Manufactory. They leased an airy, six-thousand-square-foot space in the Heath Ceramics building, on the other side of the Mission. Robertson had begun collaborating with Washington State University’s Bread Lab, and there were plans to integrate a mill, allowing the on-site production of unusual flours. “This is kind of what happens: you find another place, you build a nicer kitchen, and keep people,” Robertson told the food magazine Lucky Peach.

The Oakland coffee company Blue Bottle, which had just raised forty-five million dollars in venture capital for its own expansion, needed a bakery partner to provide food in its coffee shops. (Today, there are more than a hundred.) Tartine soon announced a merger with the company. Anticipating a personal windfall, Prueitt and Robertson moved into a luxurious house in the Castro. A photo shoot published by the Web site Eater showed off their specialized cookware, heated outdoor furniture, and lemon trees. By the time the Eater piece went live, the Blue Bottle acquisition had fallen through; the couple put the Castro house up for sale and moved out. Still, Tartine Manufactory opened in the summer of 2016. According to its designers, its space, with light wood tables arrayed beneath Noguchi paper lanterns, represented “a new type of luxury,” and referenced “Alpine lodges, Danish cafes, Stickley furniture and Japanese teahouses.” Manufactory’s menu offered sea-urchin smorrebrod, beef-heart tartare, and buffalo-milk soft serve; the next year, it was nominated for a James Beard Award. Meanwhile, Tartine launched its own coffee brand, Coffee Manufactory, in partnership with Chris Jordan, a former Starbucks executive. Jordan became Tartine’s C.O.O. Tartine developed a series of partnerships with investors, among them a real-estate private-equity firm called CIM Group.

CIM was founded in 1994, by Richard Ressler, an investment banker, and Avi Shemesh and Shaul Kuba, two Israeli immigrants whose landscaping company Ressler had employed. The firm raises money from individual and institutional investors, such as pension funds, and manages about thirty billion dollars in assets, focussing on what it calls “thriving and transitional urban communities” and “opportunity zones.” It is one of the largest property owners in Los Angeles, and a prominent commercial landlord in Oakland. Like many large real-estate companies, CIM is also a lender, providing the kinds of loans necessary for big development projects.

CIM invested in Tartine’s café and bakery business. Coffee Manufactory planned to move into Jack London Square, a waterfront neighborhood in Oakland where CIM was pursuing redevelopment. For CIM, Coffee Manufactory was intended to be an anchor tenant—a business that could attract customers and other businesses, increasing the over-all value and cachet of the area. “It’s hard to grow these types of communities in the right way,” Jordan told the San Francisco Chronicle, in 2017. CIM, he continued, “gets it, essentially. They see consumers want an organic and local experience.”

In the mid-twentieth century, developers might have taken on shoeshines and newspaper stands as amenity-oriented tenants. Today, they are more likely to seek out gourmet coffee shops, bookstores, restaurants, and cafés. It isn’t unusual for developers to offer such tenants leases with reduced rent, or no rent at all. In some cases, the tenants pay real-estate companies a percentage of their revenue. For the real-estate firms, these arrangements can help open or revitalize a building; for business owners, they can offer a respite from worrying about fund-raising, being profitable, and paying rent; and for low-margin businesses, such deals may be one of the few viable routes to expansion. (In New York City, Tishman Speyer, the real-estate firm revamping Rockefeller Center, has offered custom leases to restaurants and smaller businesses including Van Leeuwen Ice Cream and the record store Rough Trade.)

Tartine was a particularly appealing anchor tenant. The food was great, and most of it could be made off-site, requiring a fairly modest square footage for retail sites. And Tartine had a history: the flagship location, with its artistic staff and communal ambiance, radiated the sort of authenticity that a real-estate developer could only dream of cultivating. Year on year, Tartine’s brand had become cooler, airier, and more transportable. Photographs of its pastries and its Guerrero Street bakery had appeared in Apple commercials and product demos; Sweetgreen, riffing on a recipe from one of Prueitt’s cookbooks, had offered a “Tartine bowl.” In 2018, an Eater article titled “Do You Even Bake, Bro?” credited Robertson with helping to inspire hobby baking among “the disruptors, engineers, and tech bros” of Silicon Valley. That year, the bakery opened the first of six licensed locations in Seoul, one of which is located in Kinfolk Dosan, a cultural space created by Kinfolk, the aspirational life-style magazine.

Tartine’s brand was symbolic of a specific era of gentrification. The presence of a Tartine seemed to suggest a neighborhood on the cusp. During the past two decades, other businesses associated with the same era had taken on private investment and morphed into national brands. Roberta’s, the punkish pizzeria that opened in Bushwick, in 2008, now has a supermarket line of frozen pies and upscaled locations in the U.S. and Singapore; Stumptown Coffee, which started in 1999, in Portland, Oregon’s then sleepy Division-Clinton neighborhood, is now owned by JAB Holding Company, the German conglomerate behind Panera and Krispy Kreme. Real-estate developers also saw an opportunity in food culture. RSE Ventures, an investment vehicle co-founded by Stephen Ross, the chairman of the real-estate firm Related Companies, has a minority stake in David Chang’s Momofuku Holdings; Related’s Hudson Yards development touted two Momofuku businesses at its opening. (Both outlets have since closed.) On a smaller scale, Rolo’s, a restaurant in Ridgewood, Queens, is co-owned by Kermit Westergaard, a developer with a portfolio of apartment buildings in the area; in a 2018 interview, John Ortiz, a co-owner of the bar Sundown, which is in one of Westergaard’s properties, joked that the developer was “curating the neighborhood with buildings and tenants.” General Irving, an all-day café in Bushwick, was designed in partnership with Venn, an Israeli real-estate company. “With a network of purpose-built spaces and local partners, the entire neighborhood becomes an amenity for your residents,” the company’s Web site explains.

Certain gentrifiers, who consider themselves culturally savvy, “don’t want Le Bernardin, or some four-star restaurant, moving into their neighborhood, because that would ruin the charm,” Sharon Zukin, a sociologist and urbanist at Brooklyn College and the City University of New York Graduate Center, told me. “That would ruin the ‘authenticity.’ They might have a lot of economic capital, but they still want to have that authentic cultural capital that Roberta’s, or Tartine, signifies. Now, for me, and maybe also you, we’re asking: How can something still be artisanal if it has six branches in Seoul?” Zukin described the process of bringing intense, aggressive real-estate development to upper-middle-class neighborhoods, to cater to an even more affluent stratum, as “super-gentrification.” (The concept was originally introduced by the urban geographer Loretta Lees, in 2003, in reference to Brooklyn Heights.)

In 2019, Tartine opened two new bakeries in CIM-affiliated properties, in West Hollywood and San Francisco’s Inner Sunset neighborhood. (CIM has since sold the Inner Sunset property.) The West Hollywood location, Tartine Sycamore, is industrial chic, with brick walls and exposed pipes; it is within walking distance of several other CIM developments, including a creative campus and a new high-rise. That year, in expansions unrelated to its CIM partnership, Tartine also opened Manufactory Food Hall, in San Francisco International Airport; L.A. Manufactory, a restaurant in the Row, a huge, newly developed compound in downtown Los Angeles; and Tartine Berkeley, a café inside the Graduate, a chain hotel owned by Adventurous Journeys Capital, a self-described “vertically integrated real estate developer, owner, and operator.” On the occasion of Manufactory L.A.’s opening, Food & Wine published a feature on Robertson and Prueitt, with the headline “With L.A. Opening, Tartine Positions Itself for World Domination.” On Tartine’s Web site, inspirational copy asked, “What if a bakery kept its heart and soul, but always remained open to new ideas? What if a strong sense of place could successfully go more places?”

An artisanal business might grow slowly, along artisanal lines, but overheated real-estate markets offer other, faster possibilities.

Illustration by Nicholas Konrad / The New Yorker

By 2019, those hoping to make art, music, or porridge bread in San Francisco were faced with a nearly impenetrable housing market. The median rent for a two-bedroom apartment had reached nearly five thousand dollars. Many small businesses seemed to be looking for an exit; a host of larger local companies had sold to multinational corporations (La Boulange to Starbucks, Annie’s Homegrown to General Mills, Lagunitas to Heineken, Niman Ranch to Perdue, Anchor Brewing to Sapporo, Blue Bottle to Nestlé, Cowgirl Creamery to Emmi). Tartine’s employees in San Francisco watched investment flow into the new locations and felt left behind; workers at the Mission bakery suspected that they were the engine of an empire. There was confusion about the company’s investors—who were they, and how much power did they have? The Coffee Manufactory retail space, in Jack London Square, had never opened; why not? Workers wanted insight into the bakery’s finances. Tartine was expanding, and yet the Mission location needed repairs.

Workers noticed cultural changes. Shift wine was eliminated, and management introduced a monthly music playlist. Some were dissatisfied with wages, raises, and scheduling. Employees wanted certain benefits, such as paid time off separate from state-mandated sick leave, and raises larger than the annual increases mandated by the city. All this looked feasible to them, given the company’s expansion. When they brought these requests to Tartine’s newly created human-resources department, they were confused to find that it was run out of offices leased from CIM affiliates, in Los Angeles.

As Tartine expanded, operational difficulties grew. Money was allocated to ventures that didn’t pan out. The whole enterprise seemed stretched thin. Around Thanksgiving of 2019, the San Francisco bakery closed for a couple of days, on orders from the Department of Public Health. At the Row, L.A. Manufactory was struggling: after an initial flurry of publicity, crowds stopped coming. Tartine took on a new investor, Monogram Capital Partners. As the year came to an end, Manufactory L.A. closed for good, laying off its remaining workers ten days before Christmas. Around this time, Robertson appeared on Tartine’s Instagram in sponsored content for Blundstone boots.

Two months later, a hundred and forty-one of Tartine’s more than two hundred Bay Area employees announced their decision to unionize with the International Longshore and Warehouse Union. Many workers told me that they respected and admired Robertson and Prueitt and wanted to work with, not against, them. “This is not trying to bring Tartine to its knees,” Sarah Gagnon, a barista who was one of the union organizers, said at the time. “It’s just to try to have a bit more transparency, and to try and fight for the things that a lot of us have been wanting.” Pat Thomas, another union organizer, said, “We don’t know what their financial situation is. What we’re asking for is the opportunity to see.” Tartine management declined to recognize the union; they brought on Sam Singer, an infamous crisis-P.R. specialist, let him go amid criticism, and then hired a firm called Quest Consulting. A recent article in the Santa Rosa Press Democrat noted that Quest’s founder, Lupe Cruz, is seen “among labor organizers” as a “notorious union-buster who specializes in influencing Latino-dominated workforces.”

When we spoke during the union drive, in February of 2020, Robertson and Prueitt seemed surprised by the unionization effort. Restaurant margins were paper-thin, they emphasized, particularly in the Bay Area. Prueitt recalled how, in the early days, even as people queued up outside, the bakery almost went under; Bar Tartine, she said, had never turned a profit. (The restaurant closed in 2016.) “We’re perceived to be something bigger than what we are,” she told me. “There is no there there. It’s a water sandwich.” There seemed to be a fundamental disconnect. New investment was focussed on new ventures, but Tartine’s expansion relied on the strength of its brand. Existing workers, who saw themselves as essential to that brand, felt excluded from the company’s plans for the future.

That Valentine’s Day—just after the U.S. reported its fifteenth case of the coronavirus—I stopped into the bakery on Guerrero Street. Things looked much as they always had. The walls were hung with vaguely psychedelic nude paintings, and Sade flowed through the stereo. Employees working the counters and register wore Tartine Union pins, decorated with an illustration of two baguettes with a large rose in the center—an agrarian Jolly Roger. The café was packed, cozily, as usual. In one corner, two women splitting a morning bun took a video of themselves toasting glasses of champagne. I sat down at a table beside two Facebook employees, one in a T-shirt that read “I👍NY.” They were discussing their career trajectories.

“I have all these extra options. Sometimes I want to vest them—” one said to the other.

“—and just chill,” her friend finished.

An artisanal business might grow slowly, along artisanal lines, but overheated real-estate markets offer other, faster possibilities. Prueitt and Robertson, who divorced in 2020, are reluctant to talk about the company’s exact relationship with CIM, but the developer has an interest in Tartine’s newer locations—five in Southern California and one in San Francisco, all of which opened in CIM-affiliated properties. For a few months, Gary Schweikert, an executive at CIM, was the company’s interim C.E.O. (Dar Vasseghi, the former C.E.O. of Yoshinoya U.S.A, a Japanese fast-food chain, recently took over.) Richard Ressler’s daughter Jillian, a former CIM employee, is now Tartine’s vice-president of brand.

Tartine’s employees, like many service workers, have suffered during the pandemic. In early 2020, the company laid off the majority of its workforce. The San Francisco Manufactory shifted to selling pantry items and prepared foods, and the Berkeley location closed for good. Chris Jordan left the company, and several months later workers at Coffee Manufactory learned that the roastery was closing and lost their jobs with hardly a week’s notice. A small constellation of Tartine-related L.L.C.s received loans, amounting to at least five million dollars, via the Paycheck Protection Program; eventually, the San Francisco locations began rehiring employees. In March, 2021, following a thorny, protracted dispute over challenged ballots, the National Labor Relations Board announced that Tartine’s workers in San Francisco had officially unionized; the Tartine Union is now negotiating a contract, and the I.L.W.U. has begun reaching out to workers at other bakery locations. Coffee Manufactory’s production and packaging is now under the purview of J. Gursey, a wholesale roaster headquartered in Las Vegas that partners with casinos, hotels, and the band Korn.

According to Prueitt, Tartine is in debt and struggling not to sink further. Still, outside the Bay Area, it continues to grow. Tartine Silver Lake, which opened in late 2021, occupies the ground floor of a new, CIM-owned office building on Sunset Boulevard, in an area that realty agents refer to as Sunset Junction. An upscale market, Erewhon, recently went in down the block, in another new complex developed by CIM. (The market sells Tartine bread.) A new fifty-unit condo building—also a CIM development—has also opened a few minutes away. The surrounding neighborhood is a historically Latino area that has rapidly gentrified during the past two decades; it is often compared to the Mission.

CIM has also begun to invest heavily in West Adams, a historically Black and working-class neighborhood in South Los Angeles, not far from the city’s growing tech hub in Venice Beach. According to a recent article in Bloomberg, it is currently working on forty properties in the neighborhood, including new apartment complexes, and retail and commercial spaces. The area is changing quickly, and rents are rising. CIM’s presence in West Adams is controversial: Bloomberg reports that some of the strategies CIM has used in its efforts to buy up property have left local residents and business owners feeling targeted and harassed. In 2020, the firm attempted to purchase a nearby mall, Baldwin Hills Crenshaw Plaza, but withdrew its plans following concentrated, organized community pushback.

In November, Tartine West Adams opened on the ground floor of the Zoe Lofts, a new, mixed-use development, owned by CIM, in which a studio apartment starts at around nineteen hundred dollars a month. Previously, the lot had been occupied by the Zoe Christian Fellowship, a modest community church that hosted twelve-step recovery meetings, meal programs, and a summer “adventure club” for children. The new building—a low-rise wrapped in fog-colored corrugated metal, with persimmon accents framing the windows—sits across from a Seventh-day Adventist church, a parking lot, and a squat, beige apartment complex built in the nineteen-sixties; at the end of the block is another newly built, mixed-use CIM development, across from a body shop. Two nearby restaurants, Mizlala and Johnny’s West Adams, list Jordan Dembo, CIM’s chief legal officer, on L.L.C. filings for their holding companies. The Alsace, a boutique hotel developed by CIM, recently opened on the same strip.

Inside, Tartine West Adams looks much like the other, newer locations: airy and white, with tiled walls and creamy terrazzo counters. Each morning, bakers arrive in the predawn hours to prepare frangipane croissants, morning buns, banana cream tarts, and Robertson’s famous porridge bread. In our conversation, Zukin, the sociologist, had noted the ironies of the cuisine-real-estate business model. “There’s a kind of schizophrenia between cultural capital and financial capital that takes physical form in a Tartine bakery, or in a baguette,” she said. The real estate is appealing in part because of the trendiness and quality of the goods; the production of the goods is entwined with the real estate. Tartine is no longer a small neighborhood bakery, yet the bread is still artisanal—”chewy-crusted, nutty-crumbed”—and the pastries are delicious. In West Adams, the doors open at eight, and as customers walk in they may not feel that they’re entering part of a real-estate empire. They leave with loaves that are still warm. ♦