It may be weeks until any restaurants can actually open its doors again, but as businesses in other cities start reopening, many in NYC have cautiously started to sketch out the future here.
Eater rounded up predictions from NYC restaurant industry experts. These 14 industry representatives are responsible for advising hundreds of restaurants: One recommends new sanitation strategies, while another helps high-profile restaurant groups retool their executive teams. Some invest in fast-casual chains like Sweetgreen, and others represent the city’s independent restaurants and bars in neighborhoods such as Harlem and Chinatown.
Their predictions were varied: Restaurants may look more seriously at ghost kitchens — not just for delivery, but perhaps to move prep work offsite as kitchens juggle social distancing in crammed back-of-house spaces. Smartphones could become a necessary tool in dining out, both to order off online menus and potentially self-report health data before stepping into a dining room. Temperature checks at the door could become the norm.
For many of the experts surveyed, there were more questions than answers as the industry waits on official reopening guidelines from city and state legislators. There were still 1,977 new confirmed cases of COVID-19 recorded in NYC on Saturday, May 3, according to the state’s Department of Health. There have been 316,415 people known to have tested positive for the virus across the state.
“We’re not out of the woods, but we are getting closer for sure,” NYC Mayor Bill de Blasio said during a daily press conference on Monday, in reference to small business reopenings.
Looking forward, everybody is sharply focused on figuring out which measures — no matter how drastic — will make diners feel comfortable enough to venture back inside restaurants, while still making it financially feasible to keep the lights on.
Wellington Chen, executive director of the Chinatown Partnership in Manhattan and an advisor to Gov. Andrew Cuomo on New York’s reopening strategy:
These are a few of the key considerations for Chinatown, if and when we’re allowed to re-open in phases: How many 6’ radius spaces does each establishment have to provide to meet the minimum social distancing in these spatially-constrained tenement buildings? How many seats can be provided, and how many rounds of meals in order for the operator to catch up to all the past months of rents, taxes, idling expenses, and operating costs, and to break even?
It comes down to a capacity issue, whether it is physical or a mindset, and whether, at 50 percent capacity, can the stores make ends meet and turn a profit. Can we convince the public to come down to dine in and breathe indoor air — and when will the consumer be fully comfortable to go back to the pre-new normal era, if ever?
Roslyn Stone, chief operating officer of Zero Hour Health, a crisis prep and response consultancy for restaurants that works with both national chains and hundreds of independent operators in the NYC area:
We’ve heard opening called, “crawl, walk, run.” This might be translated as we’re crawling now, with curbside and delivery only. Walk would likely mean opening dining rooms with reduced occupancy — perhaps 50 percent. And run would be back to business at whatever the new “normal” may turn out to be.
But many restaurants can’t afford to open with 50 percent occupancy. One industry executive the other day stated he couldn’t consider opening without dining rooms at a minimum of 75 percent and break even. Restaurants with outdoor space may fare better under opening restrictions.
The most significant impact may be on bars or the bar areas of restaurants. There’s been discussion that nearly half of all bar stools will need to be removed to allow for six foot social distancing, and other measures implemented like floor markings.
Randy Peers, president and CEO of the Brooklyn Chamber of Commerce, which represents thousands of business owners in Brooklyn:
Occupancy will likely be limited for dining in. And yes, table spacing will probably be required. There may be limits to the number of diners allowed at one table, and restrictions on the size of each party. To compensate, restaurants may look to do more prix-fixe menus to move more diners in and out.
The biggest help that restaurants can receive right now is with reductions or suspensions of rents. It’s the restaurant’s largest fixed cost. If they are still open doing just takeout and delivery, they are probably doing so with minimal staff. Many can’t sustain on takeout alone.
So, rent reductions may be the difference between staying open or closing outright. For those already closed, they can’t re-open with three months accrued rent expected to be paid. The only thing they can do is have a conversation with their landlord and negotiate. New York state has not taken action on suspending rents, only evictions.
Steven Kamali, founder and CEO of Hospitality House, a real estate and restaurant consultancy that helps to negotiate restaurant and hotel partnerships in NYC:
My one key prediction for how the restaurant industry will evolve in the coming year: DELIVERY! DELIVERY! DELIVERY! Given all of the unknowns and anticipated restrictions, it will be prudent for restaurants to focus on this aspect of their business. Ghost kitchens will become a resource for many operators whom do not have the capital to reopen their restaurants, providing great momentum in this segment.
Mohamed Attia, executive director of the Street Vendor Project, a local non-profit that includes 2,300 food vendors across the city:
The biggest challenge now for many vendors is surviving financially and finding the means to support themselves. Then, once this situation is over, the challenge will be going back to business and having access to capital to build up the business again as there’s nothing certain at the moment about the future.
I predict that some small businesses will close permanently during and after this crisis — especially folks who can’t access any government relief programs and don’t run a big business operation.
Ed Brown, president of restaurant services at Restaurant Associates, a national food service provider that facilitates dining programs at Google, the Guggenheim, Saks Fifth Avenue, and more:
There will certainly be a rise in takeout and delivery while a trend of restaurants offering ready-to-heat meals or meal kits could prove to be successful. Cash transactions could be suspended.
Safety, quality assurance, and hygienic measures will become hallmarks of an exceptional hospitality experience. One opportunity will be ghost kitchens for delivery, but also as a high-end commissary producing high-quality mise-en-place [ingredient preparations that take place before meal service] that chefs can incorporate into their menus when they are no longer able to produce that mise-en-place at the restaurant due to physical distancing guidelines.
There will be a real struggle in back-of-house during the reopening period as many restaurants have small kitchens, limiting the number of cooks and dishwashers who will be able to work appropriately distanced.
Nikoa Evans-Hendricks, restaurant owner and co-founder and executive director of Harlem Park to Park, an organization representing over 250 small businesses in Harlem:
The industry will be forever changed. There will be significantly less competition, as many businesses will not reopen after extended periods of minimal or no operation.
The businesses that remain will be held to a higher standard. There will be increased competition as fewer business chase even fewer customers. Smaller spaces; more distancing between tables; more muted environments; and many, many safety precautions will be required to make customers feel comfortable with returning to a social environment.
Brian Schwartz, vice president at executive search firm the Elliot Group, which has helped place senior-level management at fine dining group Starr Restaurants, casual bistro the Smith’s parent company, Danish bakery import Ole & Steen, and more:
Everyone in the c-suite is already assessing their teams, and they’ve had to make sweeping calls on furloughs and layoffs. The mix of who will come back on board when the shutdown is lifted is going to look different.
Historically, the industry has a tendency of hiring executives from a fairly traditional restaurant background. We’ll likely be focused more now on identifying and developing executives who can lead this evolution by drawing upon diverse experiences, whether it be from other disciplines like technology and marketing, or tangential industries.
As restaurants pivot to more robust omnichannel revenue streams with focus on delivery, takeout, and off-premise, so will the leadership of these operations.
Akash Mirchandani, vice president at Kitchen Fund, a restaurant-focused investment firm with a portfolio that includes chains like Sweetgreen, Cava, and By Chloe:
With the iPhone/Android health data partnership where you can opt-in to track your exposure to COVID-19 on your cell phone, we may see restaurants asking customers to self-report this data, in addition to temperature checks before entering a restaurant.
There may be reservations for bars, in order to limit capacity. And fewer actual menus, replaced by more ordering from your phone at the table. There may be fewer fluke crudos, as people generally become a bit wary of raw preparations.
Alex Blum and Michael Chevett, the co-founders of NYC-based delivery logistics company Relay, which provides delivery services to over 1,000 restaurants in NYC and Philadelphia:
Unfortunately, we think many restaurants will be closed for good, so be prepared for your favorite neighborhood spot to not open again. For restaurants that do survive this crisis, we don’t think they will open all at once. It will likely take weeks for them to start serving diners again.
We could see some consolidation happening where hospitality groups that were doing well prior to COVID-19 end up absorbing well-liked brands to bring them under their umbrella.
If rent prices decline, we hope to see an exciting new cohort of restaurants appear that previously were priced out of the market. We could see the city implementing a 50 percent capacity maximum at restaurants as the shutdown is lifted, similar to what they did shortly before the full quarantine orders were put in place.
David Rosen, Brooklyn bar owner of the Woods and leader of the Brooklyn Allied Bars and Restaurants industry group:
I think that there will be a long term retrenchment from opulence, excess, and gratuitous luxury. This prediction applies to culture and norms in general, not just food.
Personally, I think that our culture had reached a point of indifferent decadence, before this pandemic started. We aren’t going to return to that anytime soon. I hope the days of shouting out and flaunting luxury brands (Hennessy, Gucci, Louis Vuitton, etc.) and similar absurd food and dining culture are behind us.
I think that we will seek experiences and products that unite us and reaffirm our humanity, not that separate based on class distinctions.
Ariel Palitz, the senior executive director for the Mayor’s Office of Nightlife, representing more than 25,000 nightlife establishments including restaurants, bars, and clubs in the city:
Funding from the federal government’s emergency loan programs will need to continue, and it must be tailored to address the very specific needs of the service industry. Bars, clubs, and restaurants are the backbone of the social economy and must be supported as essential businesses in order for our society to recover fully.
People should contact their legislators to let them know they still need help. The nightlife community is made up of natural organizers, producers and networkers. They should stay tuned in and connected to each other because, ultimately, the best way to evolve through this and come out stronger on the other side is to do it together.
Phil Colicchio, executive managing director at real estate behemoth Cushman & Wakefield’s food and beverage consulting arm, Colicchio Consulting:
In 30 or 60 days from now, most restaurants are going to have to start all over again. Let’s say someone opened a restaurant a year ago. $1 million was raised through savings, friends and family investment, and a loan or two, for a turnkey space, a lease security deposit, a designer, contractors, furniture, kitchen, equipment, food and beverage inventory, hiring a public relations pro, and hiring a staff. On March 13, the asteroid hits. Now, all the money is gone and the income has been wiped out.
The clear challenge here is raising capital — enough to re-open. Independent restaurants rarely carry meaningful cash reserves and even fewer can tap revolving lines of credit. And how many purveyors are going to be able to extend credit in this environment?
The restaurateur won’t have to raise $1 million again, but they will have to raise, say, $250,000. New inventory, some sort of rent, new staffing plan. New hygiene plan. Everything has to be re-inspected. There will be new requirements limiting the number of people you have in the restaurant. They possibly may have to pay to store some equipment. Can they raise enough money to re-open their doors, bring back and retrain staff, re-design what they have to, and pass their inspections — which we have to believe will be more aggressive going forward? And with mandatory seating limitations, can enough revenue be generated to make this effort worthwhile?
To raise the money, they probably won’t be nearly as successful going back to the same fundraising sources. Most people the restaurateur would go to can’t put capital at risk right now. Once again, the likelihood that the restaurant was doing great financially in the first year is probably modest. I don’t foresee a lot of loose capital laying around in 60 to 90 days.
Jennifer Baum, president of Bullfrog + Baum, one of the leading food PR companies in New York:
I think the layout of restaurants will change dramatically during the first phases of reopening. Tables will be removed to allow for more space, bars will not allow standing. Menus will become single-use (printing is not dead!), and uniforms will include branded masks. I suspect menus will get shorter to manage limited staff and capacity. And reservation times will be more spread out. I’m not sure you’ll be able to simply walk into your favorite restaurant for some time.