IOWA CITY – The Iowa City Downtown District announced the opening of Luna’s Tacos, a beloved family-owned Mexican restaurant that has transitioned from a farmers market vendor to a permanent downtown location at 127 E. Washington Street. The restaurant officially opened its doors on January 19, 2026, adding to the mix of locally-owned restaurants that make Downtown Iowa City a vibrant dining destination and demonstrating the area’s continued appeal for culinary entrepreneurs.
Luna’s Tacos, owned and operated by Isabel Luna, has been a fixture in the Iowa City community since 2019, when Isabel first began selling authentic Mexican cuisine at the Iowa City Farmers Market. From the very beginning, it has been a true family effort, with Isabel’s husband Salatiel and their children, Zayety Westpeling, Siomara, and Itzael, working hard alongside her to build the business. What started as a Wednesday market stand quickly expanded to include Saturday markets, summer festival appearances, and a mobile food cart on the Pedestrian Mall, demonstrating the strong demand for quality, authentic dining experiences in Downtown Iowa City.
The new brick-and-mortar location features an expanded menu showcasing Isabel’s favorite family recipes, including Albondigas (savory chicken meatballs in chipotle sauce), A La Mexicana (chicken or steak with tomatoes, onions, and green chilies), Pork Salsa Verde (Isabel’s personal favorite featuring slow-cooked pork in tangy tomatillo sauce), Chiles Rellenos (roasted poblano peppers stuffed with cheese or tofu and fried golden), and Birria (marinated beef slow-cooked in rich broth with chilies and spices).
The restaurant is open daily from 10:30 a.m. to 8:00 p.m., providing year-round dining options for residents, visitors, and the downtown workforce. In addition to dine-in service, Luna’s Tacos offers catering for weddings, graduation parties, quinceañeras, and private events.
“The community has been looking for us, and we’re thrilled to finally have a permanent home downtown,” said Isabel Luna, owner of Luna’s Tacos. “Opening this restaurant allows us to serve our community year-round, provide stable employment opportunities for our dedicated team, and share our family’s favorite dishes with Iowa City. We’re excited to finally have a space where people can gather and experience authentic Mexican cuisine.”
Isabel’s decision to establish a permanent location was driven by consistent community demand and the desire to provide year-round employment for her dedicated staff, who previously could only work during the farmers’ market and festival seasons. The expansion from mobile vendor to permanent restaurant reflects broader positive trends in Downtown Iowa City’s business landscape. Luna’s Tacos represents the type of locally-owned, community-driven business that contributes to downtown’s unique character and economic resilience.
“Isabel’s journey from farmers market vendor to downtown restaurant owner exemplifies the entrepreneurial spirit that makes our Downtown District thrive,” said Christopher Hunter, Director of Marketing at the Iowa City Downtown District. “Luna’s Tacos has built a loyal following through exceptional food and genuine community connection. We’re excited to support this next chapter and welcome the year-round vitality this business brings to Washington Street and Downtown.”
Luna’s Tacos participated in the Iowa City Downtown District’s CoSign+ Grant Program, which provides matching funds for signage and storefront enhancements to downtown businesses. The program, which evolved from the National Sign Museum’s CoSign initiative, offers approved applicants up to a 50% match for projecting signs (up to $3,500) and storefront enhancements (up to $2,500). To date, the Iowa City Downtown District has facilitated over 30 pedestrian-oriented projecting blade signs and approximately 15 storefront enhancements throughout the downtown area.
