Atlanta restaurants reeling as pandemic keeps diners at home

The novel coronavirus pandemic is wreaking havoc on Atlanta's restaurant industry.

This week, establishments across the metro region have seen sales drop off by 50% to 70%. So far, Georgia Governor Brian Kemp has not made plans to mandate the closure of restaurants and bars in the state, but the night of March 16, Atlanta Mayor Keisha Lance Bottoms issued an executive order limiting occupancy at all "public-gathering spaces" to 50 people. Earlier in the day, Brookhaven Mayor John Ernst ordered all restaurants to be limited to take-out and delivery service and all bars that do not serve food to close. Other municipalities in DeKalb County are expected to follow suit.

The situation is fluid, and all information in this column is up to date as of press time.

Many restaurateurs in Atlanta have taken it upon themselves to alter business models or close down entirely in an effort to prevent the spread of COVID-19. Among those are Hugh Acheson, who on March 16 announced he would temporarily close Midtown's Empire State South and Five & Ten in Athens while trying to formulate "some different options to get [customers] tasty vittles in a safe and smart way."

Acheson, like so many in the industry, fears some businesses may not recover from the financial hit.

"You’re going to see a fallout from this," he told Atlanta Business Chronicle. "I don’t know how long it’s going to go on for, but this is also an industry that just doesn’t have $500,000 on hand for clean-up situations and to stave off business failure."

Major attractions go dark

Ponce City Market, the popular Old Fourth Ward development that is home to several buzzy restaurants and food stalls, closed down at the end of service Tuesday, March 17. The development, owned by Jamestown Properties LLC, did not announce a potential reopening date in its statement, but one tenant, The Forum Athletic Club, told customers an update is expected by April 1.

Earlier in the week, Midtown's fabulous Fox Theatre announced its temporary shutter. The theater said ticket holders for upcoming events that include Miss Saigon, AllStar Legends of Hip Hop, Bill Maher and Fox Theatre tours would be notified by email of "next steps." Ticket holders for Wait, Wait Don't Tell Me, the NPR quiz show that decided to record without an audience at the Fox March 12, will receive refunds.

GRA seeks millions in aid

With the pandemic is bringing the dining industry to its knees, the Georgia Restaurant Association is asking government officials to provide millions of dollars in support.

The GRA and its national counterpart are hoping governors will formally declare economic injury loan disasters so restaurateurs can apply for U.S. Small Business Association disaster loan assistance. Through this program, $50 billion in total federal funding is available. Business owners can apply for maximum $2 million loans with up to 30-year amortization and an annual interest rate of 3.75%. An application typically has a 21-day processing and evaluation period, but that could be longer based on demand. As of Monday morning, no governor had made the formal declaration to start the application process.

The GRA has been in contact with Kemp and Senator David Perdue. In addition to an economic injury loan disaster declaration, the group is making the following requests of Kemp:

• Expansion of the Georgia job credit program to employers in the retail and restaurant businesses.
• Expansion of the investment tax credit to include all hospitality and retail companies.
• Creation of a state version of the employee retention credit, an income tax credit for certain employers in federal disaster areas who continue to pay their employees during periods in which their businesses are inoperable.

Requested federal assistance includes:

• Temporary assistance that would allow businesses and employees to defer mortgage payments in the event of further declines in sales.
• Temporary interest-only payments on any SBA loans.
• Tax breaks for individual business owners or restaurants that have suffered a 30% or greater decline in business since Jan. 1, 2020.
• The establishment of restaurants as temporary school meal facilities in order to support families impacted by mandatory school closures.

Restaurants and bars in Georgia operate on profit margins of 4% to 6%. GRA chief executive officer Karen Bremer roughly estimates the state's industry may need as much as $83.3 million per month in aid just to cover occupancy and labor costs.

"The industry can't take a hit like this," Bremer told the Chronicle. "It's too fragile. The government needs to step in."

Star Bar under new management

The Star Community Bar, a celebrated dive that has operated in Little Five Points since 1991, has a new team of owners.

Christopher Jackson, Luke Lewis, Dan Meade and Bruce McLeod have taken over the Star Bar business and signed a lease for the space at 437 Moreland Ave. NE in early January. The ownership group brings extensive industry experience. Jackson has been a longtime bartender at The Highlander in Midtown, and Meade's bartending resume includes time at Trackside Tavern and The Comet Pub & Lanes in Decatur. Lewis has previous bartending experience and has worked in the live production business for 21 years.

Star Bar closed at the end of service Dec. 31 as the building's landlord moved on from previous owner Kahle Davis. The new owners were hoping to reopen by the end of March, but the effects of COVID-19 may delay those plans.