Satellite S.B., which brought a strong natural wine community to the heart of downtown Santa Barbara, will close its doors after nearly a decade in business on September 13.
Owner Drew Cuddy — who opened the business in the front room of a shared office space at 1117 State Street in June 2017 — could not come to an agreement with the landlord, which is now Kiva Coworking. He also cited the lack of downtown housing as a reason for slower business in recent years.
But Cuddy, who opened a second, events-based concept called The Factory on East Haley Street in 2024, is not sad about the news.
“It’s always unfortunate to change the seasons, but this was a natural thing,” he said. “It was never a perfect space, being in the entryway to a coworking space. We really thrived there in spite of that.”
He said that Kiva wanted to do a few things differently, and that he wanted to do things differently as well, but that their visions wouldn’t align in a way that served either. “I feel no ill will about it at all,” said Cuddy. He’s proud to have built a business and fostered a community around natural wine, including many former employees and customers who have gone on to impressive wine industry jobs.
“The cool thing is that, with The Factory, nothing is slowing down,” said Cuddy. “We get to keep doing everything we have been doing, getting people together and getting them stoked about wine.” He’s planning to host more gatherings at the Haley Street site, where he already throws the Natural Coast Wine Festival each spring as well as regular wine tastings, concerts, and private events throughout the year.
Cuddy does not see Satellite’s closure as a comment on the state of natural wine or vegetarian cuisine, though the restaurant business is suffering broadly right now when $6-per-gallon gas forces people to cut down on eating out. Nor does he believe this news has much to do about how appealing State Street is or whether it has cars or not.
Rather, he feels Satellite’s end is largely due to the lack of housing in downtown Santa Barbara, which is crippling the business environment. “People don’t live downtown,” he said. “In order for us to be able to have a sustainable business in a post-Amazon, post-HelloFresh world, you have to make it easy for people to walk out their front door and go somewhere locally. When you only have 200 to 300 people and the rest are vacation rentals on State Street, that doesn’t make it sustainable for anybody.”
Cuddy is excited to start advocating for more downtown housing. “We need to embrace mixed residential-commercial properties,” he said. “There are still so many vacancies.” Many downtown properties, he said, have been empty the entire time that he’s run Satellite.
“If we don’t have more people, you’re gonna see a lot of stories like us, except they won’t have a fallback option to keep their community going,” said Cuddy.
He does dream of coming back downtown one day. “If we can get residential on State Street and have the economy not feel like the middle class is an endangered species,” he explained, “I think we could come back and build something really special downtown. I’m depending on the Santa Barbara City Council to really do something with promoting development downtown that feels a little more permanent.”
