The Biz Beat: Kyoto Palace in Campbell still reigns after more than 40 years

The clang of the chef’s utensils delight as he twirls and flips them in the air, sending bits of egg for his customers to catch in their mouths. On the steaming griddle, he draws a rooster out of egg yolk to children’s squeals.

This is part of Kyoto Palace’s renowned dinner and a show, but currently it’s only offered to a limited audience. Due to a 25% decrease in staff, the Japanese restaurant located at the Pruneyard in Campbell has to limit its hours and capacity.

Owner Dale Yoshihara said he is grateful for their customers, but can’t seat the demand they have.

“We are more than thankful that Kyoto Palace was able to survive the pandemic,” it says on its website. “Without those of you who supported us with to-go ordering and outside dining, we wouldn’t be here. It has been a joy having you back.”

The business shut down in March 2020 for a few weeks and reopened with to-go food and limited outdoor dining. In addition to the support of loyal customers, the restaurant kept going by providing 32,000 meals to front line health care workers at local hospitals.

On Aug. 1, 2020, Yoshihara closed Kyoto Palace for two weeks to restructure. He decreased the budget and worked with staff to create a limited menu featuring the restaurant’s most popular dishes.

“We did okay, Yoshihara said. “We made it through.”

But it wasn’t easy. Unable to serve indoors during the Christmas holiday season and Valentine’s Day, the restaurant’s busiest times of year, it lost money. Yoshihara said he was checking the bank balance daily to make sure they could make payroll.

The restaurant, established in 1976, still is only partially open. Its sushi bar and karaoke nights are on hold until after the pandemic. Happily, indoor seating, although limited, has returned and with it, the interactive experience its customers enjoy.

Dale’s son and manager, Daniel Yoshihara, said many customers told him last year was the first birthday they didn’t get to celebrate at Kyoto Palace.

“We just want to see people’s faces back in the restaurant,” he told San José Spotlight. “We specialize in the interactive concept and thrive off our customer’s happiness.”

Open and celebrating

The Loera family dines at Kyoto Palace weekly and has been coming since 2017.

“We love the food, and the service is great too,” said Maria Loera, who favors the shrimp dishes. 

Her husband, Cristian, likes the filet mignon and their seven-year-old son, Cristian Jr., loves the lobster. All the children, including six-year-old Lupita and one-year-old Jayleen, thrill at the chef’s antics, their eyes following his every move.

“It’s a real joy to watch their eyes light up,” Dale Yoshihara said.

Daniel Yoshihara and fellow manager Ashley Strangis have worked at Kyoto Palace for 15 years.

“We spend more time here than with our families at home,” Daniel Yoshihara said. “You get so close to people.”

One of their favorite things is seeing customers who came as children now bring families of their own, he said.

“We’re always amazed at how big everyone’s gotten,” Strangis said, adding they see people who celebrated their fifth birthday now celebrating their 21st.

Yoshihara has owned Kyoto Palace for more than 20 years with partner Charles Reynolds. Yoshihara previously owned Bini’s Bar and Grille near Japantown, and when it closed he thought it was the perfect opportunity to explore the Japanese culture. 

As a fourth generation Japanese American, Yoshihara finds the Kyoto Palace surroundings soothing. 

“Customers like it because it’s friendly and warm, like the Japanese people,” he said. “It’s something I cherish.”

Contact Lorraine Gabbert at [email protected].

Editor’s Note: The Biz Beat is a series highlighting local small businesses and restaurants in Silicon Valley. Know a business you’d like to see featured? Let us know at [email protected].