Chinatown restaurants are no longer the only ones to be impacted financially by novel coronavirus fears. Many restaurateurs across the city say that parties are getting canceled and business is seeing dips since the first confirmed case in New York was reported last week — and with Governor Andrew Cuomo declaring a state of emergency in the state on Saturday, some say they think the ripple effect on business will get worse. There were 19 confirmed cases of new coronavirus in the city as of Monday, according to the governor’s office. Many corporate offices are encouraging staffers to work from home, and Mayor Bill de Blasio has urged people who feel sick to limit use of public transit.
Hotel restaurants and catering companies are seeing the biggest impact, following sharp declines in the hotel industry, cancellations in conferences and events, and fewer corporate lunch orders. Tom Colicchio says his company’s revenue is down as much as 70 percent between event cancellations and slow hotel business. While his longtime American restaurant Craft has remained more stable, his FiDi restaurant Temple Court is in a hotel and his Midtown business Riverpark caters conferences and events nearly weekly. The NYC Hospitality Alliance, a nonprofit representing restaurants and bars, says its seen “a big drop” in business and private event cancellations and has been accordingly trying to provide as much info as possible.
Michael Sinensky, founder of Simple Venue, a hospitality group that runs Sushi by Bae and Sushi by Bou, says his restaurants that rely heavily on traffic from tourists and corporate lunches have recently reported sales drop-offs by as much as 25 percent. He’s expecting things to slow down for “several weeks,” he says. At Upper East Side bar the Penrose, owner Ruairi Curtin has had four to five corporate customers cancel private events in the past two weeks, amounting to thousands of dollars in lost revenue, though regular business has been normal.
Besides cancellations, fewer companies are booking events for the spring — reserving dates but not signing contracts as uncertainty surrounding the coronavirus continues, Colicchio says.
“It’s terrible. It’s just an unknown here,” Colicchio says. “You have no idea how long it’s going to last. It’s hard to get in front of ... who knows when things will go back to normal?”
Some restaurants that don’t rely on big parties are also seeing a decline in foot traffic and cancellations, though outside of Chinatowns in Manhattan and Flushing, most say it’s not significant yet. Fast-casual chain Xi’an Famous Foods’s CEO Jason Wang saw a 20 percent dip in sales at locations in Flushing and Manhattan’s Chinatown last month when the crisis was more limited to Wuhan, China, but during that time, sales remained steady at the chain’s 12 other locations across the city. He’s noticed, however, that customer foot traffic has been down at the start of this week.
Jae Lee, of casual new East Village Korean restaurant Nowon, says business started going down about three weeks ago and has tapered since then, but it’s “not detrimental.” Sakura Yagi of T.I.C., the restaurant group behind popular downtown Japanese spots such as Sobaya, says though foot traffic is “visibly lower” and some big groups have canceled, many people seem to be coming out “to maintain a sense of normalcy.”
Still, some worry that even a small dip is a sign of more to come. East Village impresario Ravi DeRossi — who owns 15 restaurants and bars, from the more formal Avant Garden to hit cocktail bars like Death & Co — says over the weekend, a quarter of reservations canceled day-of, with some saying they’re concerned about being in public places and others worried about not feeling well.
“This was the first weekend,” he says. “My feeling is every weekend, it’s going to get worse and worse.”
Even restaurants that aren’t seeing declines in business are taking extra precautions. Number one, of course, is extra cleaning and telling staffers to stay home if they feel sick. The restaurant industry is already “constantly concerned about hygiene” because of the threat of food-borne illnesses, Yagi says, so part of the protocol has been to remind employees about standard procedures.
Beyond that, more things are getting disinfected, and more frequently. Lee has instructed staff to disinfect door handles and light switches more often, while Derek Feldman’s Uchu Hospitality has increased cleaning on both public areas and ventilation systems. DeRossi’s businesses now get a cleaning twice a day, and disinfectant napkins have been added inside and outside restrooms. “Our level of sanitation is through the roof,” he says.
This situation, though, is unprecedented — and lots of new measures are being implemented, too. Yagi and her team have been trying to figure out how to train staff on dealing “with fear and panic,” as well as talking about how to address concerns from the staff, she says. “As an Asian establishment, we know how unfairly Asians have been treated because of our ethnicity. So we talked about the importance of welcoming all guests,” she says.
But they’ve also had to discuss what to do practically if a person coughs and other customers express worry. “We talked about asking that person if they are okay and passing them a napkin and giving them water,” she says. “They may just be coughing because food went down the wrong pipe. We don’t know. But most of us are already worried about sneezing and coughing in public; making it a scene is not going to help anyone.”
To curb expenses, Colicchio’s restaurants have been ordering less food and putting a hold on bigger purchases, such as bottles of wine and office supplies. DeRossi has been cross-training staff, should they eventually need to operate with fewer people, and he’s asked all employees, no matter how junior, to get onto the communication tool Slack so that he can reach them immediately with updates. Restaurant managers at Xi’an Famous Foods have instructed employees to start doing daily deep cleanings in the restaurants — not just for sanitation purposes, but also to keep busy.
Some restaurants are expanding delivery options. The Sushi by Bae and Sushi by Bou restaurants are developing a delivery omakase box that they are trying to roll out as soon as possible, to “balance the business we expect to lose due to the virus panic,” Sinensky says. Several of DeRossi’s restaurants already offer delivery — Honeybee’s, Mother of Pearl, Night Music — but he’s also adding delivery at Avant Garden and Ladybird in the next week or so, he says. He’s having a staffer take those new delivery orders by phone, as getting online with a third-party platform such as Seamless or Uber Eats can take weeks.
ChowNow, a third-party online ordering platform that services over 1,100 restaurants in the New York City area, reports that the company has not yet seen significant changes in ordering behavior amid the heightened new coronavirus concerns. However, analytics lead Jordan Plecque notes that “the number of active diners in NYC during the first week of March was the highest it has been all year on our platform.” Grubhub and DoorDash (which also own Seamless and Caviar, respectively) declined to share data around whether they’ve observed recent shifts in customer ordering behavior in New York City. In contrast, supermarkets are experiencing higher-than-usual purchasing activity in dry goods and packaged foods, as shoppers stock up on supplies.
“I’ll be honest, I’m a little scared,” DeRossi says. “I’m in the East Village. All it takes is one case. If one restaurant in the East Village says, ‘This person at this restaurant got that,’ and the entire East Village will shut down overnight. I honestly don’t know what to do, other than take every serious precaution that we can.”
Boosting delivery isn’t a viable option for many restaurants, though. Bars can’t deliver alcohol, getting online takes weeks, and some restaurateurs say the fees they would need to pay to platforms are too high for it to be worth it. Curtin of the Penrose says that while the bar has historically never had to offer delivery because the kitchen is busy enough as is, he met with a delivery consultant last week to explore options. He’s “probably not going to go down that route,” Curtin says, because of how time-consuming it would be to successfully make the pivot.
Ultimately, there’s very little anybody can do, and it’s unclear how things will unfold, restaurateurs say. “The next 30 days will be a good barometer as to what’s going to happen in terms of impact to business in the short and long term,” Curtin says.
New York State health department’s guidelines on preventive measures to take against contracting the virus have remained steady throughout the past few weeks, and include regular hand-washing and staying home when ill. The state is making hand sanitizer available to residents free of charge, prioritizing distribution with the most “high-risk” communities, including the New Rochelle area and people who work for the MTA. The Governor’s office also recently announced that it is pushing a bill through local legislature that will more rigorously cover workers with paid sick leave protection as the situation advances.
But if sales continue to slide amid the new coronavirus fears, restaurants can’t get money from insurance as a “business interruption” unless the government demands all of them to shut down, which would trigger the help. Landlords will still want rent, a cost that can’t be cut; some say they hope that landlords be willing to cut deals in light of the situation. And that doesn’t even count the number of staff that would be making less money, should hours be cut at restaurants across the city.
“I think we’re in for a long period of uncertainty right now,” Colicchio says.