April is here, and that means many of Vancouver’s small businesses have had to grapple with one of the more challenging aspects of the ongoing COIVD-19 crisis: how to pay their rent.
Many small businesses have had to temporarily shut their doors under Washington’s statewide stay-at-home order, and those that can remain open have had to adapt to a completely new business landscape, one that often results in lower customer traffic.
Restaurants are a case in point.
“It felt like the sky was the limit for our business, and then this just came out of nowhere for us, just like everyone,” said Mychal Dynes, co-owner of the restaurant Little Conejo in downtown Vancouver.
Support on the way
The Greater Vancouver Chamber of Commerce has been working to bolster support for local small businesses, mainly by connecting them with small business grants from the state and other resources.
“(Small businesses) are head-down, trying to survive this unprecedented time,” chamber CEO John McDonough said. “We’re just constantly reminding them ‘Hey, there are resources, check them out.’ ”
The two biggest lifelines for small businesses right now are the Paycheck Protection Program and the U.S. Small Business Administration Economic Injury Disaster Loan Program.
The paycheck program was created as part of the $2 trillion economic relief package passed by Congress last month. It gives small businesses access to loans to help cover payroll expenses, which can be forgiven if a business keeps its staff employed during the coronavirus crisis.
Both programs are responding slowly in the face of a deluge of applicants, so businesses have to keep fending for themselves in the meantime — and none of the applications came through fast enough to help businesses with rent checks at the start of the month.
Instead, relief has often come in the form of flexibility from landlords. Several local businesses and landlords discussed setting up ad-hoc payment deferral plans in recent weeks.
Little Conejo has fared reasonably well during the past month, which Dynes attributed to painful early action: The restaurant almost immediately cut about 80 percent of its staff, leaving just Dynes, co-owner Mark Wooten and a few remaining employees.
The stay-at-home order closed down all dining rooms, and while it allows for takeout and delivery service, that model is an entirely new realm for a lot of local eateries, including Little Conejo.
The rate of to-go orders hasn’t matched the restaurant’s usual traffic, Dynes said, but it’s been better than expected and consistently improving — so much so that the restaurant was able to bring back four more employees last week.
The restaurant owners applied for a PPP loan, Dynes said, but in the meantime they’ve also been bolstered by a positive response from their landlord, Schofield Properties. Dynes said the company offered the restaurant a break on rent, so they only needed to make a partial payment for April.
“We all have to kind of help each other and find a way to pass the relief down the line if you can,” Dynes said. “My hope is that, just like small-business owners are scrambling to find all the information and fill out the applications, I would hope landlords are doing the same thing.”
At the Hidden House Market, co-owner Elaine Frances said she and her husband, David White, closed the lunch cafe for the first week after Inslee’s restaurant shutdown order, then resumed operations with to-go service and curbside delivery from the restaurant’s small grocery section.
They’ve also been working with their vendors to expand their grocery lineup based on what customers have been requesting, she said, and they have been experimenting with take-home dinners and other restaurant offerings.
Even so, she said, the restaurant has only been open for a few months, and without the regular downtown lunch crowd, there just hasn’t been enough customer traffic to be sustainable. The market has applied for an SBA loan, Frances said, but it hasn’t been processed yet.
In the meantime, she said the market has been able to keep operating in part because of flexibility from its landlords, the Hidden family.
“They’ve told us to not worry about paying our lease until all of this is over,” she said. “They offered without us even asking.”
Schofield Properties owns several downtown buildings with many retail tenants, and general manager Rob Aschieris said he’s been offering payment deferral options to all of his tenants who need them.
“Basically, what I say is, ‘Whatever you can afford to pay for now, it’s OK. We’ll catch up later,’ ” he said.
Aschieris said he’s also begun reaching out to banks to see what support options might be available for his own business, although so far he hasn’t been able to line anything up. But he said he has been able to work with the Clark County Assessor’s Office to delay property taxes on the Schofield buildings until later in the year.
Clark County Treasurer Alishia Topper announced a policy change in mid-March to allow for business tax payment plans, invoking authority granted by Inslee’s declaration of a state of emergency in Washington to adjust property tax due dates. She followed that up last week with an order extending the property tax deadline to June 3.
Other municipal governments have taken action, as well — on April 3, Vancouver City Manager Eric Holmes announced that the city would temporarily suspend collection of business license fees and surcharges and make it illegal for landlords to evict small businesses for lack of payment.
Another downtown landlord, Bruno Amicci, said he’s given his tenants the option of deferring their rent without penalties or interest, with a plan to reevaluate every 30 days. Their contracts included a “black swan” disaster clause, he said, outlining those options in the event of a natural disaster such as an earthquake or pandemic.
Amicci owns Luepke Station, home to Tap Union Freehouse, which he said has been able to continue take-out operations. He’s also the landlord for Low Bar, which has had to close down during the outbreak.
Amicci said he’s been focused on connecting his tenants with small-business resources, particularly the PPP and EIDL applications. He’s an advocate for rent forgiveness, given the circumstances, but he said he also wants to see it paired with mortgage and property tax forgiveness, to help landlords out with their own expenses when their revenues are cut off.
“No rental income impacts the landlord just like shutting down the revenue stream of any other business,” he said. “Some landlords can afford to go without rental income for a few months, and some cannot. Each of us make that call as circumstances require.”
At Bleu Door Bakery in Uptown Village, owner Bonnie Brasure has had to deal with both sides of the equation; she also owns the building through a separate LLC.
Brasure said she tried to operate Bleu Door as a take-out business during the first week of the restaurant shutdown, but there just wasn’t enough customer traffic to be cost-effective, so she had to temporarily close the bakery down and lay off her staff.
She can’t simply stop paying rent to herself, however. As the building owner, she also has to make regular mortgage payments. But she was able to cut the rent in half, she said, because her mortgage loan came from the U.S. Small Business Administration, which volunteered to make payments on her behalf for six months.
Brasure said she also applied for both the PPP and EIDL loans, but on that front she hasn’t had any luck yet.
“ ‘We received your application’ — that’s what I’ve gotten,” she said. “It’d be nice to hear something.”