COFFEE FANS LOVE THE BEAN SCENE.

Byline: Deborah Adamson Daily News Staff Writer

Paul Israel thrives on coffee.

The Van Nuys resident drinks nine cups a day, black. He prefers a strong brew. A few months ago, he got hooked on espresso.

``I go to coffeehouses maybe twice a day,'' said Israel one languid afternoon, clutching a glass of the black liquid as he watched passers-by from his perch at a corner table outside Horse Shoe Coffee House in Sherman Oaks.

``I like it here. I just sit and drink coffee,'' he said.

Like Israel, Americans have a love affair with this bitter brew.

In recent years, that taste has grown to include gourmet coffee concoctions on a mass scale. Mainstream America has embraced what used to be the drink of the artistic community.

As a result, there's a lot of latte everywhere.

Whether your daily fix runs toward caffe mocha or espresso, there's usually a place nearby to buy it. Coffeehouses - which specialize in coffee, unlike coffee shops - are in malls, bookstores and probably on the street where you live.

But if you think Los Angeles is all cappuccinoed out, guess again.

There are several hundred specialty coffeehouses in the Los Angeles area, which serve roughly 20 million people, said Ted Lingle, executive director of the Specialty Coffee Association of America in Long Beach. In contrast, Seattle's King County has 1,000 cafes serving a 1 million population.

Nationwide, coffeehouses should begin to sprout everywhere, he said.

``We're just beginning,'' Lingle said. ``We're projecting continued growth (of coffeehouses) till the peak of the baby boomer cycle between 2010 and 2015.''

There could be 10,000 coffeehouses nationwide by the end of the century, he estimated. That's 7,000 more than in 1994.

``It's becoming mainstream American now,'' he said. ``It started when stores that sold coffee beans began selling beverages. Starbucks is an icon, but it's not the only one that led this charge. It would have happened without Starbucks.''

However, Seattle-based Starbucks' aggressive expansion plans certainly help.

The nation's largest chain of coffeehouses already has more than 1,100 stores, and it plans to open an additional 231 stores this year. That's in addition to the many marketing alliances it has - supplying coffee to United Airlines, selling to food retailers such as PriceCostco Inc. and marketing an ice cream line.

Another growth-minded chain is Coffee Beanery, a Michigan-based coffeehouse that plans to open 25 new locations this year. It has a store in Burbank.

The third largest chain behind Starbucks and Gloria Jean's, Coffee Beanery hopes to have more than 200 stores by the end of the year.

Peet's Coffee & Tea of Berkeley opened its first Southern California location in Pasadena last month. The chain, which has 6,000 mail-order customers in the Southland, is scouting for more locations in the area.

``(Pasadena) has been our best opening ever,'' said Heather Corcoran, marketing director at 31-year-old Peet's.

Also on the expansion route is Diedrich Coffee of Irvine. It plans to open 20 to 30 stores in 1997. It already has 53 stores in California, Colorado and Texas.

``It's part of our expansion strategy to build and take advantage of a trend towards consolidation in this industry,'' said Steven Lupinacci, president and chief executive of Diedrich Coffee.

Indeed, many independent operators have thrown in the towel rather than compete with the big chains. Even larger operations such as Diedrich have to compete with mega-chain Starbucks.

Lupinacci said Diedrich competes by individually designing each store. For example, one boasts a North African motif complete with Moroccan belly dancers. It also sells kosher coffee.

In addition, the chain will start opening shops in Home Savings of America branches in May throughout the Los Angeles area.

Coffee Beanery relies on a line of dessert drinks, a homey atmosphere and marketing alliances - like opening in a car dealership - to remain competitive.

In contrast, Starbucks caters more to a quick-service crowd that likes to have consistency of product, said Rita Boyadjian, who teaches a class on operating coffeehouses at the Learning Annex, an institution for adult education.

``Billions of people go to McDonald's because of consistency,'' she said. ``When you order a cappuccino, it will always be the same at any Starbucks.''

While some independent operators are hurt by the presence of big chains, the coffeehouse market is big enough for both to flourish, said Laura Richardson, a retail analyst at Pacific Crest Securities in Portland.

``I think there's a place for both,'' she said.

``Starbucks has a reputation. It's a national name, and there's a certain cache to going to a place like that,'' Richardson said. ``But there's also a segment of the population who likes to patronize the local business rather than chains.''

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2 Photos

Photo: (1--Color) Star Irvine, who owns Eagle's coffeehouse in North Hollywood, center, says customers patronize her shop because of its cozy appeal.

Phil McCarten/Daily News

(2--Color) No caption (Coffee brews)