A reader says he views the crisis from the perspectives of both the hospitality and the real estate industries. He urges flexibility as Maine enters “uncharted territory.”
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The pandemic feels like it’s gone on forever, but there are impacts we’re just discovering. One is that despite an “opening,” restaurants won’t be back to normal anytime soon. Landlords need to face reality that they won’t be able to collect full rent from restaurants as the pandemic continues. Re-opening restaurants will face scared diners, cut occupancy, and staff shortages. As a distributor of international wines and a commercial property investor I see both sides.
Local restaurants have played an invaluable role in the growth of Maine as an international tourist destination and helped drive property values higher. The shutdown has suddenly made dining rooms worthless just as restaurants were stretching their budgets to afford them. Landlords attempting to hold restaurants to full lease payments risk killing the goose that lays the golden egg. However, as an investor looking for additional properties, I know how much work goes into managing commercial buildings. Rent doesn’t go into the landlord’s pocket; it pays the mortgage, maintenance, utilities and other costs. It’s unrealistic for a restaurant to pay top dollar for a space they can’t use, but also unrealistic for a landlord to forgive all rent over what could be a year.
We’re in uncharted territory, but we know that many Mainers are willing to spend money on great dining. We know that out-of-state visitors will eagerly spend money on good food this summer. Restaurants can adapt, but they need the breathing room of formal rent modifications. I’m asking landlords to give rent reductions of at least 50% for six months. It’s a sacrifice, but otherwise a large number of Maine restaurants may fail leaving landlords struggling to fill spaces during a pandemic with 15% unemployment. Empty storefronts and higher unemployment rates could be the downfall of communities that have spent the last decade growing. Many landlords have been accommodating, but formalizing agreements will give restaurateurs the breathing room to adapt their businesses, survive this shutdown and keep our community vibrant.
Ned Swain
Devenish Wines, Portland
