Barely Recovered from Sandy, NYC Restaurants Reflect on Lessons Learned to Cope With COVID-19

For many NYC restaurants staying open right now, the ongoing coronavirus crisis serves as a grim reminder of the several existential threats the industry has been forced to navigate in just the last 20 years. 9/11 paralyzed businesses, particularly downtown Manhattan, with many predicting that part of NYC would never recover. Many others struggled to stay afloat in the aftermath of the financial crisis in 2008, and Hurricane Sandy further crippled restaurants and bars along the city’s coastal neighborhoods in 2012.

Now, the industry faces yet another unprecedented crisis. Still, some owners are hopeful and are looking at the most recent crisis that rocked the industry — Sandy — to find ways to overcome the current predicament. Here, seven NYC restaurateurs reflect on the lessons learned from the storm, including the creation of months-long emergency funds to stay afloat during a crisis, altering menus to make them more conducive to family-style dining, and finding time to make long-term fixes during a lull in business.

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Dan Tubridy, co-owner of Rockaway destination Bungalow Bar. His restaurant group, IGC Hospitality, operates 13 other restaurants and bars across the city.

Damage from Hurricane Sandy: The entire building that houses Bungalow Bar was destroyed, and Tubridy estimates that the damage totaled around $1 million.

Cash generated to help post-Hurricane Sandy: Tubridy and his partners invested $300,000 of their own money, which is equivalent to three years’ profit at Bungalow Bar. They generated an additional $150,000 through an appearance on Spike TV show Bar Rescue, as the prize for participating on the show, and they secured additional funds from friends and family. Tubridy also applied for three federal loans, all of which were denied. The restaurant didn’t receive anything from its insurance coverage either. “We took on a lot of the construction and rebuilding work ourselves, because we had no other work to do, which is where we really saved money,” says Tubridy

Lessons learned from Hurricane Sandy: “We learned from Sandy to have a three-to-six-month slush fund to fall back on,” Tubridy says. “Since then, we always keep a little war chest just in case something like that were to happen again. Though we were thinking of a flood or something like that. This is completely different.”

Estimated money lost from COVID-19 so far: Tubridy estimates “roughly just over half a million in lost revenue so far, as we go into our primetime months.” Bungalow Bar’s sales are down roughly 26 percent year-over-year.

COVID-19 survival strategies: Tubridy has closed 11 of IGC Hospitality’s 13 restaurants, and has furloughed 800 employees total. So far, takeout and deliveries are helping Bungalow Bar break even. The open restaurants are only operating with half of its staff, and the menu has been rejiggered to be more takeout-friendly, and includes family-style meal packages.

COVID-19 funding received so far: Tubridy has applied for the Paycheck Protection Program (PPP) and the Economic Injury Disaster Loan (EIDL). He received $10,000 from EIDL in late April, and was approved for PPP. He was initially concerned about actually using the funds under the original guidelines, then opted to use the PPP funds once the forgiveness period extended, to hire back employees.

Predictions post-COVID-19: Turbidy worries that the city may be overzealous with inspections and fines of restaurants, enforcing social distancing measures and otherwise — after the pandemic passes — in an effort to recover lost revenue during the ongoing crisis. “It’s a tactic I’ve dealt with if there’s a shortfall,” he says. He also worries that many permanent closures are inevitable at this point: “We know many of our places won’t be able to survive serving at 50 percent capacity under the current lease agreements,” he says. “No one will be immune to restaurants closing. We contribute to so many different industries, like commercial real estate, trucking, vendors, and farmers, which will be negatively affected by these imminent closures.”

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Jeepney [Official]

Nicole Ponseca, owner of East Village Filipino restaurant Jeepney and the now-closed Maharlika. Jeepney opened in October 2012, mere days before Sandy.

Damage from Hurricane Sandy: Flooding throughout the East Village narrowly missed Jeepney by a block, but “it didn’t make it any easier for us to operate when people around us didn’t even have electricity,” Ponseca says. “It wasn’t a mandated closure, so it was about, ‘How are you going to stay open if the water is waist deep in the East Village?”

Cash generated to help post-Hurricane Sandy: Ponseca borrowed from her other restaurant, Maharlika, to keep Jeepney operating, and didn’t pay rent for five months on Jeepney’s then-new spot to stay afloat: “I don’t know if it was just blind ignorance, or just really hopeful optimism that it’s going to work out and we’d figure it out,” Ponseca says. “Probably a little bit of both.”

Lesson learned from Hurricane Sandy: Creative business ideas can be spurred by tumultuous times, says Ponseca. Jeepney’s signature family-style Kamayan feasts, launched three months after Sandy, are “really what saved the restaurant,” Ponseca says. The first week of Jeepney’s Kamayan feasts brought two reservations; one week later, there was a three-month waitlist. “It was gangbusters, and became almost 40 percent of our revenue,” she says.

Estimated money lost from COVID-19 so far: Jeepney is currently making less than five percent of its revenue. Ponseca estimates the total losses are “a couple hundred thousand dollars, but the overall impact is easily millions, looking at the worst-case scenario: total closure,” she says. It’s a stark contrast to the restaurant’s financial health before the pandemic hit NYC, making the current figures all the more gutting. Ponseca says January and February 2020 were exceptionally strong: “We were doing summer numbers in Q1, a period that’s usually awful, and were already on a positive track [for 2020] which was delightful.”

COVID-19 survival strategies: Jeepney closed in mid-March for two weeks before reopening for takeout and delivery, which are usually just a single-digit percentage of Jeepney’s profits, “nothing to sustain a business,” Ponseca says. “The irony is, feeding hospitals is what is keeping us alive.” She estimates she retains 70 to 75 percent of proceeds from hospital meal donations. Jeepney’s former beverage director and Dante alum Marlo Gamoura helped Ponseca set up a cocktail-to-go program, which is supported by pair-ups with liquor brands Courvoisier and Santa Teresa. She’s also selling discounted gift cards, and sales from “My Best Friend Is Filipino” T-shirts go to an employee relief fund.

COVID-19 funding received so far: Ponseca has applied for the PPP and the EIDL, but is waiting to hear back on both. She was denied by four other relief funds, including one by the James Beard Foundation. “I have received zero funding, and I don’t have the luxury of being emotional about it, or the luxury of figuring out where else to apply,” Ponseca says. “I have food to cook and shit to do.”

Predictions post-COVID: “I think a lot of us restaurateurs are really going to be finding ourselves in new adventures,” she says, which, for Jeepney, may mean a lessened focus on those hands-on large-format feasts. “Our identities are tied up with businesses, and we’re now facing the redefinition or loss of identity,” she says. “I want to remind other restaurant owners to stay strong, and if you have to close, you are not your business.”

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Fort Defiance [Official]

St. John Frizell, owner of Red Hook cocktail bar and restaurant Fort Defiance. He’s also co-owner of downtown Brooklyn restaurant Gage & Tollner, which was set to open mid-March.

Damage from Hurricane Sandy: Around $75,000 due to equipment and inventory damages including the entire basement flooding, plus water damage in the restaurant. Frizell also lost $100,000 due to the restaurant being closed for one month.

Cash generated to help post-Sandy: Frizell sold $30,000 worth of gift certificates, though only 60 percent of the gift cards were redeemed. He also received a $25,000 state loan with a one percent interest rate, a $25,000 ‘angel investor’ loan from a family friend, a $12,000 donation from Restore Red Hook, a Sandy recovery nonprofit, and a $10,000 grant from Empire Development Corporation. It took five years to fully pay off all his Sandy debt.

Lessons learned from Sandy: “I know two things for sure [from Sandy]: Government aid is going to be inadequate for your needs, and it may come too late to matter,” Frizell says. “Anyone who thinks their business is going to be made whole by the government [pandemic funding] is dreaming. You have to just assume you’re getting nothing, and if you want to keep your business, you’re going to have to figure it out for yourself.”

Estimated money lost from COVID-19 so far: Fort Defiance has lost an estimated $190,000 in revenue from mid-March to present. “The business as a whole is not operating in the black right now, but we’re less in the red, losing less money than we would be,” Frizell says. Sales are down over 75 percent during the pandemic, and “are not enough to cover our utilities or pay rent or insurance, but it’s better than nothing, and it’s better than losing more money.”

COVID-19 survival strategies: Fort Defiance quickly pivoted to an online orders-only contactless general store, with CSA produce boxes from Lancaster Farm Fresh, a modest and rotating grocery selection, cocktails to-go, and prepared foods, all available by online order. Grocery items have included tortillas from Tortillería Nixtamal, Caroline Schiff’s baked goods, Pat LaFrieda steaks, tahini, and produce like avocados and mangos. “I’m really having a good time with this,” Frizell says of experimenting with a small yet eclectic grocery offering, and he plans to continue operating as a general store for the foreseeable future. “I’m trying to figure out a way to keep the grocery as part of the Fort Defiance business model, at least for the next few months, even if we open the dining room,” he says.

Covid-19 funding received so far: Frizell has received a PPP loan so far: “We haven’t spent any of it yet and are currently considering our options,” he says. “The new terms of the PPP loan no longer require a ‘Brewster’s Millions’–style eight-week spending spree, and that’s definitely an improvement” which makes PPP funding “much more useful for restaurateurs,” Frizell says, though he is doubtful Fort Defiance will ever qualify for full forgiveness. “We don’t think we’ll reach our pre-COVID employment levels by December 31, 2020, or perhaps ever, but the extension of terms from two years to five years makes the PPP a good medium-term loan.” He applied for an EIDL loan, and received the one-time $10,000 grant in late April. Frizell also applied for Facebook’s Small Business Grants program but hasn’t heard back yet. He also started an employee relief GoFundMe in March, which has reached its $10,000 goal to date, and will be putting 5 percent of his CSA box sales toward employee relief.

Predictions post-COVID: “The margins are really thin, especially for a neighborhood restaurant with 42 seats in an underdeveloped neighborhood.” He’s more optimistic about the long-term prospects of Gage & Tollner, his newer project with the co-owners of Red Hook restaurant the Good Fork, because the bar’s landlords are also business partners, and because of a sizable federal small business loan that was approved in January. Gage & Tollner opened in March but had to close soon after and Frizell and his partners were forced to lay off the entire staff. A reopening date for that spot isn’t set yet.

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Thai Rock [Official]

Robert Kaskel, owner of Rockaway restaurant, bar, and live music venue Thai Rock. He has lived above Thai Rock with his wife, Metta Kaskel, and in-laws, who hail from Thailand, since Sandy, when the Kaskels’ nearby apartment was destroyed in the storm; Metta was a restaurant owner and bartender and her sister Karog Prom was a chef for 25 years in Thailand.

Damage from Hurricane Sandy: The structurally unsound “Frankenstein building” of multiple structures cobbled together on a pier that houses Kaskel’s business (and home) was badly ravaged, and it took an entire year to fully reopen, with challenges like not having gas for six weeks after the storm. Reconstruction costs and losses totaled around $1.5 million.

Cash generated to help post-Sandy: Kaskel received $200,000 in total from two of three federal small business loans he applied for over a six-year period. An additional $75,000 was generated from a local utility grant, specifically for replacement refrigerators. Kaskel also received $25,000 from property insurance, solely for wind damage coverage, not flooding, and a donation of around $1,000 generated from benefit shows at other NYC area bars put on by musicians that regularly perform at Thai Rock. Kaskel also received a bridge loan from a friend for the deposit to buy the building he lives and works in: The sale was nearly complete pre-Sandy, and after the storm, “the prior owner told me I was welcome to stay, but any damages would be my responsibility to repair, so buying it was the only way forward,” he says. Kaskel tried unsuccessfully to get a traditional bank loan before going to his friend, who he paid back with another loan from a hard money lender. He’s still working to repay his loans: eight years later, he’s close to $3 million in debt.

Lessons learned from Sandy: “To this day, I still struggle with the recovery of Sandy,” Kaskel says. “I got money from all different sources in all different ways, and a lot of it was not good money to get, very expensive money.”

Sandy survival strategies: Jet ski rentals were an unlikely survival revenue source for Thai Rock. Kaskel launched the spin-off venture just months before Sandy as a marketing tactic for the restaurant, starting with two jet skis. The quirky concept sold thousands of rides in a few weeks, so Kaskel doubled his watersport fleet that summer, and then doubled it again in the summer of 2013 to eight jet skis (at $9,000 per vehicle, plus costs of additional docks and steeper insurance rates). “Really, that jetski business helped keep me alive,” Kaskel says. “The added income from the jet skis allowed a lot of wrinkles to be ironed out when we were recovering from Sandy, and made the difference between surviving and not.”

Estimated money lost from COVID-19 so far: Sales are currently “just enough to pay for the food and staff” by staying open for takeout and delivery, which previously accounted for just 10 to 15 percent of Thai Rock’s profits. April sales were down 50% year-over-year, and May sales were even worse than April, Kaskel says.

COVID-19 survival strategies: In mid-March, Kaskel laid off around 18 employees, dropping from Thai Rock’s usual low season headcount of 20 employees to just two (aside from the Kaskels themselves). They re-hired an additional employee each week during April, a fraught decision for the Kaskels. “We don’t want them to risk taking public transportation, so either I or my brother-in-law drive our employees to and from home, and they live 40 to 45 minutes away,” he says. By early June, the restaurant was staffed with 10 to 12 employees daily. Thai Rock was open for five days a week until late May, then increased to six days weekly, with plans of operating seven days once the city moves into the second phase of reopening.

COVID-19 funding received so far: Kaskel applied for, and was approved, for both PPP and EIDL loans. “The modifications to PPP were definitely helpful, but I wish those changes had been part of the original mandate,” he says. “I spent money quickly [on employee payroll] only so it wouldn’t be a burden to me later, but I know I could’ve spent it better.”

Predictions post-COVID-19: Kaskel remains hopeful. “I have no doubt that when the dust starts to settle, whether it’s months from now, or next year, whenever, we will all want to go out to eat again,” Kaskel says. “Once we get to the other side, we’ll be stronger and better for it. I think people will appreciate each other a little bit more.”

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Linda Chen Marini, co-owner of FiDi Italian restaurant, Da Claudio. Linda and husband Claudio Marini co-owned Barbarini, another Italian spot nearby in the Seaport District, from 2006 to 2012, when it was completely destroyed by Sandy.

Damage from Hurricane Sandy: Over $1 million due to equipment loss, plus “thousands and thousands of dollars” in inventory; Marini estimates Barbarini was on track to make $1.5 million for the year when the storm hit.

Cash generated to help post-Sandy: For Da Claudio’s construction and equipment costs, the Marinis used $1.5 million, the majority from a risky, high-interest 10-year loan that could only be secured by putting their apartment as collateral. “Banks I’d banked with for decades didn’t want to touch us and we didn’t get any help from insurance, I knocked on every damn door,” Marini says. She applied for federal small business loans and FEMA relief, but “because I didn’t want to rebuild in the same space [susceptible to] a future storm, I was locked out of any type of access to any aid; you had to rebuild in the exact same location to qualify.” The Marinis also raised $18,000 via online crowdfunding, “for a restaurant that we didn’t yet know where it would be,” she says, and a few thousand dollars from selling discounted gift certificates.

Lessons learned from Sandy: “My past experiences with Sandy, and 9/11, have taught me that you have to take everything into your own hands” Marini says. “It’s helped me to fine-tune, really appreciate, and go after things that work, and drop what doesn’t.”

Estimated money lost from COVID-19 so far: “May was pitiful, business was down over 80%,” Marini says, which is worse than the previous two months: Sales were down 70% in April and 52% in March (after a sales increase of 25% in February). The area has become progressively more of a ghost town in the past three months, Marini says: “Lower Manhattan has not seemed this empty in my over 20 years in the neighborhood, not even after 9/11.”

COVID-19 survival strategies: After an initial nine-day closure in March, Da Claudio reopened, scaling back its employee headcount from 32 to 12-14 daily for around two months, and since June, is back up to an 18-person staff. The Marinis arranged with the New York Presbyterian Hospital — a block from Da Claudio — to deliver meals for their employees, funded by customer donations. Some generous customers have bought 20 or 50 hospital worker meals a piece. Da Claudio has also been selling gift cards for future use, and collaborated with various vendors (cheese, salumi, oils, etc) and their butcher, Debragga, to offer restaurant customers discount codes of home delivery directly from those vendors.

COVID-19 funding received so far: Marini applied for the PPP loan twice, through Chase and a smaller bank she doesn’t typically use, Darien Bank; she found out late April that her application was approved, through Darien Bank, and finally received funding around two weeks later. “I’m thrilled the PPP guidelines have been changed — it will help a great deal,” she says. “However, given that the reopening phase for restaurants offers no guarantees, the concern is to make sure that the funds stretch for a longer period of time and that we have a reserve for when business slowly comes back to normal.” She also applied for EIDL and received the $10,000 grant in late April. She also applied for the Downtown Alliance Rental Assistance Grant in late May, which has been approved but no funding has been received yet.

Predictions post-COVID-19: Marini expects “when we do reopen fully, people will be back, and will appreciate restaurants at a different level in the future” after months of quarantine cooking. But recovering financially will “be a slow process,” she says: “Unfortunately, I do think that it’ll be survival of the fittest.”

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Renato Poliafito, owner of Prospect Heights bakery Ciao, Gloria, which opened in November 2019. Poliafito co-owned the cafe Baked, in Red Hook from 2005 until 2017, which was hit hard by Sandy.

Damage from Hurricane Sandy: Baked’s basement flooded, destroying many thousands of dollars worth of inventory, equipment, and important paperwork. Luckily, Baked’s electricity was out for only a few days while much of Red Hook lost it for months, allowing the bakery to become a community gathering spot. “When our power came back, we just turned on a dime and started operating again, offering what we could,” Poliafito says. “We told people who didn’t have electricity to come in, charge their phones, and just hang out,” he says. “We became a bit of a neighborhood hub.”

Cash generated to help post-Sandy: Poliafito and his Baked co-owners received a federal small business loan in the ballpark of $40,000 to $50,000, which was paid back in five years, as well as $25,000 from two local grants.

Lessons learned from Sandy: Improbably, Baked thrived after the storm because of disaster funding, “which helped the company go from an infancy stage to adult stage,” Poliafito says. “We were able to repair the damage and come back as ‘Baked 2.0.’ The disaster strangely gave us a chance to prioritize, fix some things, and come back stronger.” His decision to close Ciao, Gloria temporarily in mid-March instead of attempting a scaled-back operation indefinitely “was like my Sandy approach: close down, see what happens, then go back, instead of trying to open up earlier and potentially faltering.”

Estimated money lost from COVID-19 so far: Poliafito left Baked in 2017 and opened Ciao, Gloria in November 2019. “I’m losing a significant amount weekly,” Poliafito says, and adds that Ciao, Gloria’s business is down 40 percent, and is “wildly irregular, with very little rhyme or reason: I can have an okay Monday, but then a horrible Friday, it’s all upside down, and once I started seeing some patterns emerge, everything shifted again from the [Black Lives Matter] protests,” Poliafito says.

COVID-19 survival strategies: Poliafito reopened on May 8 for takeout and delivery only, with a limited menu, and a “little Italian pantry” with products like double-zero flour for making pasta and pizza, coffee beans, and yeast. “It kind of took off,” he says. “I see a lot more activity in retail because of it.”. He also rehired eight of his original 12-person staff with PPP funding under the loan’s original guidelines, but has since reduced his employee headcount, going from being “adequately staffed to minimally staffed,” to parse out the loan for a longer period. On May 31, the bakery started offering a “Sunday Supper” three-course meal kit. He’s also considering expanding a selection of food-adjacent and lifestyle goods for sale, like T-shirts, diffusers, ceramics, candles, books, or what he calls “aspirational things.”

COVID-19 funding received so far: Poliafito applied for a PPP loan via his bank, Chase, as well as a few smaller banks, and finally received the PPP loan in late April. He applied and was approved for an EIDL loan that he says in the same range of the PPP loan amount. Initially, he was apprehensive about taking on an additional loan, but decided to move forward, though he hasn’t received the EIDL funding yet. He also applied for Facebook’s Small Business Grants program, which he hasn’t heard back about yet, and a Verizon loan, which he did not get. An employee relief fund on GoFundMe started mid-March with a goal of raising $40,000 (or a month’s payroll) is currently around $9,201.

Predictions post-COVID-19: “I’m totally cynical at this point,” Poliafito says. “Sandy was really arduous, stressful, and unfamiliar, but we got through it, so when [COVID] happened, I felt mentally prepared, that it would work out” he says. He’s hopeful the latter half of June will bring about “a little more stability” for Ciao, Gloria, though “honestly, any forecasting is out the window,” he says.

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Michelle Tampakis, owner of Red Hook gluten-free bakery Whipped Pastry Boutique, which opened days before Sandy hit.

Damage from Hurricane Sandy: The entire building that houses Whipped Pastry Boutique was destroyed, filled by four feet of water, which required brand new electrical wiring and a new industrial refrigerator. Tampakis estimates the damage totaled around $1 million.

Cash generated to help post-Sandy: Tampakis borrowed from her husband’s small construction business, as she was denied for a FEMA relief package and SBA loan. “Basically, his business propped up mine, to buy equipment that needed replacing and give infusions of cash here and there,” Tampakis says. “Having access to that money was the only reason I was able to get back on my feet,” she recalls. “FEMA required proof of at least a year’s worth of invoices to show that you were in business and qualify for any kind of disaster relief,” Tampakis says, which her bakery was too new to have. Same with SBA, which wasn’t “offering any kind of disaster relief for startups, you had to prove you had a loss of income.”

Lessons learned from Sandy: Tampakis baked out of her church until the Red Hook space was inhabitable again in January 2013. Because her sole client at the time of Sandy didn’t end up wanting the full order after the storm, much of it got donated to a homeless shelter: “luckily, stuff didn’t go in the garbage,” she says. Once back in her company’s space her “first order of business was to start getting more clients and do more revenue-wise.” By 2019, her staff had grown from a one-woman operation to 11 people.

Estimated money lost from COVID-19 so far: Over $110,000 since mid-March, or $10,000 to $12,000 weekly.

COVID-19 survival strategies: Tampakis decided to close indefinitely when she saw orders drop 60-70% in one week in early March, right before the citywide shutdown. “I didn’t want to, again, be in the position of having to rely on my own money or my husband’s business to keep my business open, probably for a long time,” she says. “My decision was to not try to stay afloat.” In March and April, she and her family donated baked goods to multiple local hospitals, made from Whipped Pastry’s remaining inventory.

COVID-19 funding received so far: She applied, and was approved, for an EIDL loan, and has received $6000 out of $10,000 loan total to date. Currently, she is looking to sell the bakery.

Predictions post-COVID: Tampakis does not plan to reopen Whipped Pastry Boutique, a decision she made in late April. Around that time, she also offered usage of the bakery’s facilities to the city, for preparing food pantry meals: “We received several inquiries to fill out questionnaires about the type of space we were offering for the city to use, but no one actually followed up to say they needed the space,” she says. Tampakis is currently looking to sell Whipped Pastry Boutique. “Before I opened this bakery, I was not risk-averse. I was very confident, and I felt like I could do anything with hard work,” Tampakis says. “There’s a lot of things I should have done differently that might have put me in a better position now.”

This story has been updated to correct that Jeepney did not get free rent.

Alexandra Ilyashov is an NYC-based (and -bred) freelance writer and editor covering food, fashion, wellness, cannabis, and entertainment.