Are Austin Food Trucks Past Their Expiration Date?
Torchy’s Tacos' big food truck send-off last Wednesday was sweet and whimsical and an ode to Austin’s past, but it also pointed out what many food truck owners already know: Food trucks may no longer be the darling of the Austin food scene, and food truck parks are feeling the pain.
Just last year, Austin food truck growth was ranked No. 1 in the U.S., up 600% between 2010 and 2016. And that is causing problems for the existing food trucks. Noble Sandwich Co. co-owner John Bates, manning his food truck at Southbites at SXSW this week, said the food truck market peaked four years ago and has been adding way too many players.
"I think all things restaurants are saturated: trailers, brick-and-mortar, however you want to get your food out there," Bates said. "It's just saturated. That's the reason why you see the turnover you do in restaurants."
Food chains like Torchy's Tacos and Chi'lantro BBQ came out of Austin's food truck craze. Two years ago, Austin was the food truck capital of America, and everyone — even Bisnow — had a list of favorite trucks.
But even a casual observer driving through South Austin and West Campus can tell the food truck business is slowing down. Trucks are shuttered. Hours are limited. And even the expansion of delivery services like Favor and Grubhub have failed to provide the necessary kick to keep trucks afloat.
The Austin-Travis County Public Health Department does not track who comes and goes in the food truck business, but it does permit all food establishments. Last year, a total of 5,700 establishments were permitted for food service. Of that number, 1,284 permits went to food trucks and mobile vendors.
Last year, between 400 and 500 restaurants opened in Austin, Bates said. Each of those restaurants needs about $1M in revenue to succeed.
"That means Austin as a whole needs to fork out an additional $400M to $500M a year in food entertainment dollars," Bates said. "I just don't think that's a sustainable model."
It has also gotten harder to find a good location. Downtown nightlife was once Sixth Street. Now it is East Sixth, West Sixth and Rainey Street, too. The foot traffic is not the same, Mmmpanadas co-owner Cody Fields said.
Mmmpanadas has two trucks: one outside the Mueller Hangar and at the concession stand in front of Barton Springs Pool at the Zilker Zephyr.
"Food trucks can be very location-dependent, but that's not a guarantee," Fields said. "We've seen some of the more successful food trailer parks, like Midway Food Truck Park on 360, go under."
Even Mueller, which caters to families, can be tough for food trucks. The best days are Farmers Market Days, when the Hangar is a destination.
"It's filled in nicely, but it's still not always busy," Fields said. "If that was the only way we made an income, we'd be in trouble."
Food truck operators increasingly need additional income streams, whether that is event catering, additional locations or even a frozen food product line, to make it.
For Noble Sandwich Co., the food truck appears at events like SXSW, but its primary purpose is business and party catering. Chi'lantro, famous for its kimchi fries, has brick-and-mortar locations, with a lunch truck on Congress Avenue and a truck on Sixth Street only open for evening foot traffic.
Mmmpanadas has been around about as long as Torchy's Tacos — a decade — but owners Cody and Kristen Fields are moving in a different direction: getting the empanadas into the frozen food section at Whole Foods and Wheatsville Co-Op.
Cody Fields said the business has gotten harder. When the couple first started, they would park the truck downtown for late-night foot traffic. They would drive to business parks during the day to pick up business. Now they generally keep their two trucks stationary, except for special events.
Fields uses the same word Bates used: Austin is saturated.
"The food truck business has never been easy," Fields said. "Now that there is so much competition, it's just spread a lot more thin."
As land gets tighter and taxes go up, the cost of leasing space grows. That definitely applies for events such as Southbites at SXSW.
"Generally, we just do Southbites for the exposure," Fields said. "People think food trucks are so popular, that we're making so much money, but they're charging exorbitant fees. When you're paying $4K to $10K for 10 days (at Southbites) all you can hope for is exposure."
The nature of taking up space has also changed. Food trucks in Austin initially appeared on lots in higher traffic areas along South Congress and South Lamar that were facing imminent redevelopment. Trailers would have a hot six-month run, then move to a more established location. The St. Elmo Public Market, on South Congress, is one example of this. Peleton is marketing an office building on the lot, and daytime traffic from the PUBLIC Lofts next door provides much of the traffic.
But for the last few years, food truck parks took hold as owners who intend to hold their lots long term or do not intend to develop them at all, have marketed leases directly to food trucks. This has had lesser success. Traffic may be seasonal or sparse. Those would include the food court behind the University Co-Op on the Drag and Torchy's Trailer Park, which has dwindled to only Conscious Cravings and Cacao with the closure of the Torchy's trailer.
Midway Food Park was, until January, one of the success stories. Located off Loop 360, the park combined the right variety of food trailer and family-friendly fun, plus regular holiday events and on-site concerts.
"When we first opened the park, it was when all of the trailers on Congress were getting moved off because of development, and so there was a real need for this," Midway Food Park Manager Sarah Hannon told KXAN when it closed. "We built it out and it was great, but it seems like over the last four-and-a-half years, the food truck industry has just blown up in town, and every single person has figured out that they can shave off a little piece of their parking lot."
Dock and Roll Diner was parked at Midway Food Park from beginning to end. The four years at the park went fairly well until leasing faltered. The space will be turned into event space this month.
"There weren't as many trailers in the park and that definitely was not attractive to the community," Dock and Roll Diner owner Lee Kressner said. "I appreciated we could go there, but there weren't really a full roster of trailers there over the last year."
Kressner's trucks are now at The Picnic on Barton Springs and a mobile truck for events. Kressner, who has run his food trucks since 2011, said he has begun to seriously look for permanent restaurant space. He is less inclined to turn to catering or additional trucks.
"We're very grateful for the private events we do, but we analyzed that a bit," Kressner said. "It takes a lot of effort, time and energy to have a good catering program. We feel like if we spend a lot of time on that, it will only take away from the time we need to spend to take that next step."
Learn about the latest Austin trends at Bisnow's Austin State of the Market event March 29. Register here.