How Business is Reopening During the Pandemic
When the COVID-19 pandemic first shut down all businesses in Coral Gables, the Allen Morris Company was quick to adapt. With 50 some employees, most of them working in the iconic Alhambra Towers the firm built, mobile technology was deployed to link workers together. “We anticipated that we might have to work remotely,” says CEO W. Allen Morris. “We tweaked our technology to make sure everyone was connected and operational. We were ready to go.”
Morris himself began working marathon days, with Zoom meetings scheduled back to back not just for clients, but also with the company’s various management teams. “I found it to be very efficient,” he said. “I was also exhausted at the end of the day, with no breaks.” He set up full offices at home, as well as in his house in the Keys – and his log cabin in North Carolina.
Three months later, when the first phases of the reopening of business began, Morris was relieved to spend at least a few days a week back at the office. “You really lose something when you can’t interact with colleagues. You lose a lot of creativity,” Morris says. “Now that I am getting back to the office, I love the increased productivity I get meeting people face to face. There is something so much better about being able to talk to people in person.” The company has now opened its offices on a split-shift basis, three days a week for one half of the staff, three days for the other half. Not only do they sit apart from each other, “we have all our employees tested, and their temperatures taken as they come in, in the morning.”
Not all large employers in the Gables have jumped at the chance to bring workers back to the offices, however, at least not just yet. Corporate giants like Bacardi and Del Monte, for example, have initially continued to keep their employees working at home and in the field, connected with HQ and each other via mobile platforms. “Our priority is to keep people safe and to give them the flexibility they need during these new circumstances,” says Pete Carr, regional president of Bacardi North America, which employs 300 at their Gables office. “We know we will need to make some adjustments in our shared spaces when we welcome people back.”
Del Monte Fresh Produce is taking a similarly cautious approach. Since March, most of their 350 employees have been working from home with less than 10 people coming to the building, says Martha Jeifetz, chief human resources officer. “Right now, we are thinking about a staggered return to the building beginning with a small team that can test new protocols and safety measures,” she says.
At BHHS/EWM, which employs 220 people in the Gables, the company immediately went into a remote modality. Now workers are returning but keeping their distance. There are plastic barriers at the reception counter, everyone is required to wear a mask, and there are hand sanitizers everywhere you turn. “We don’t encourage people to come into the office and don’t have group meetings. We use Microsoft Teams and Zoom,” says company president Ron Shuffield. “This [virus] is here to stay for a long time and we just have to get used to it.”
“Businesses are concerned about one person becoming sick and exposing everyone in the office to the coronavirus,” says Mark Trowbridge, president and CEO, Coral Gables Chamber of Commerce. “So, there are still lots of videoconferencing meetings.” The chamber itself is open with split schedules for the 10-person staff. “We limit the people in our office – and have invested in personal protective equipment (PPE) branded for the chamber.”
ON THE STREET
For restaurants and retailers, remote work is not a viable option. While many have developed online and contact-free strategies to stay alive, their businesses are by their very nature tied to the brick and mortar world.
During the pandemic shutdown, restaurateurs laid off most of their staff, focusing on delivery and pickup. Even when they were allowed to open on May 20, they could operate only at 50 percent seating capacity, in order to meet the requirements of social distancing. Those with plentiful outdoor seating were at an advantage, but even here the crowds remain slow to return, absent the city’s pre-COVID daily influx of 50,000 (mostly office) workers.
“To run a restaurant at 50 percent capacity is not feasible in the long run,” says Nino Pernetti, owner of Caffe Abbracci. “Break even for most restaurants is 75 percent, or 80 percent. I rotate them, but I can keep only some of my staff. We have to take this one day at a time, going slowly.”
At Threefold Cafe on Giralda Plaza, business is 40 to 60 percent back to where it was, says owner Nick Sharp, thanks to a loyal local clientele. His other restaurant, Someone’s Son, is down by 90 percent, because its Douglas Entrance location depends on traffic from office workers now working from home. “It’s a business to business, location by location situation,” he says. “The challenge is that we are neither fully open nor closed. We are in this middle ground. You can’t do normal things like create events.” Sharp says he is not optimistic about what will happen over the next six months. “I don’t have a lot of amazing ideas for how the downtown can be busy when 80 or 90 percent of the people normally there are gone… Until that changes, we are not going back to normal.”
Retail merchandisers are facing equally daunting challenges. When the lockdown took place, their normal income evaporated; many shifted to online sales to survive. “Thank goodness we had built out our ecommerce website, because that is what really saved us in May,” says Jill Hornick, co-owner of Jae’s Jewelers on Miracle Mile. “We probably had 10 times our normal online sales that month.”
“Really, what we have done to make ourselves viable is to turn into an online book seller, with a full virtual event calendar [for our author series],” says Mitchell Kaplan, the owner of Books and Books on Aragon. Nonetheless, the loss of in-store customers hurts. “The problem with a community-based bookstore is that we thrive on bringing the community together, but that is what makes the virus spread. We have to be careful about how many people we can bring in at a time.”
Some small businesses have not been hit as badly as others. On the retail front, stores that already had established takeout business models were quickest to recover – places like pizza parlors and ice cream stores. Along Sunset Drive in the South Gables, for example, neighborhood favorite Whip ’n Dip lost business during the pandemic but has come back to pre-COVID sales levels.
“We have always been a takeout place, so we just adapted,” says George Giampetro, whose family has owned the ice cream shop since 1985. “We adapted within days to online ordering and then curbside service,” he says. “We trimmed the staff – the employees at high risk – and then the PPP [Paycheck Protection Program] came through, so we have all of our staff that felt comfortable coming back.”
In general, small businesses that are less retail-oriented have had a less painful time. “Our business hasn’t changed that much,” says Catalina Perez, owner of Inkberries design firm. “We are not a business that deals with the public in person a lot. I have clients I have never met, in other cities or other states.” Perez says that after the first few weeks of shock, her clients continued on with projects – including rebranding for the post-COVID era.
Other industries, such as construction, were almost entirely unscathed. “I think our industry was one of the ones least affected,” says Venny Torre, CEO of Torre Construction, which has eight active projects in the Gables. Among them is the restoration of the Palma Hotel in the downtown, and construction of the Althea Row townhouses for MG Developer. “We are one of the fortunate ones. I don’t know that the business of construction has slowed down anywhere across Dade County. There is a lot of activity out there.”
Medical offices, too, have been relatively quick to recover, though their patient load has been curtailed by policies designed to help contain the virus (see sidebar). In residential real estate, an initial pandemic panic slowed sales to a crawl. But since then a combination of clever technology and pent up demand appears to be propelling that industry back. Indeed, businesses that are tech savvy or not dependent on point of contact sales have weathered the pandemic fairly well. What has changed radically for them is the way business is now done.
“Most businesses that function in an office setting were pleasantly surprised that working remotely has worked out better than expected,” says commercial real estate expert Barbara Tria. “It was bumpy at first, but it wasn’t the same thing as a shutdown of their income sources, which is what happened in retail.”
When coronavirus pushed South Florida into lockdown in March, for example, BAC Florida Bank found itself in a better position than most. Some 83 percent of customers at the one-branch bank already used its digital platforms, many from overseas, so BAC didn’t need to worry as much about how to serve its clients remotely.
Still, like other banks, BAC Florida had to move quickly to address health concerns. It sent most of its 175 employees to work from home, turned more to videoconferencing and set up new systems at its offices, including wearing masks, providing hand sanitizers, keeping six-foot distance between clients, installing plexiglass for tellers, limiting the number of people in the branch and scheduling more appointments.
“The most used word these days is unprecedented,” says Julio Rojas, president and CEO of the Coral Gables-based bank that has more than $2 billion in assets. “The challenge is to be more adaptable, creative and collaborative between teams.”
The Business of Medicine on the Mend
From Private Clinics to Hospitals, Normalcy Begins to Return
The main concern for skin cancer surgeon Dr. Alysa Herman was how to keep her staff employed when her clinic was ordered to close down. “We actually shut down on two different occasions, for two weeks at a time,” she says. “Then we came back, at 30 percent of what we usually do, for people with melanomas… the income barely covered expenses, and our staff was worried about being furloughed.”
Instead of laying off her employees, she had them use up their vacation time and sick time, “or not get paid.” All chose the option of forced vacation and sick time, she says. “Not one person complained.” Now her clinic is fully opened for routine visits, but with all necessary precautions, including masks, gloves, staggered visits – and the elimination of a waiting area with magazines and coffee service.
Hospitals, too, are back seeing patients for non-emergency and elective procedures. “We have resumed our surgeries, procedures and imaging diagnostic services, and any other services we did before COVID,” says Diane Amado-Tate, the chief nursing officer at Doctors Hospital. “What’s different is that we are screening patients and staff members every day, with body temperatures, signs for symptoms and questionnaires to see if they’ve been exposed.”
Dr. Dipen Parekh, chief clinical officer and COO for the University of Miami Health System, says COVID-19 has sparked a dramatic increase in telemedicine. “The number of ‘tele-visits’ went from 200 a month to 200 a day,” he says. “We are on track to doing 10,000 tele-visits just in the month of June.” That transition from in person to online was critical in stemming the pressure on facilities like The Lennar Foundation Medical Center. “Once the lockdown was lifted there was a huge demand for elective procedures. Fortunately, we were able to activate telemedicine in a very short time.”
TOMORROW’S OFFICE SPACE
With so much of the local economy depending on the demand from the workers who formerly commuted daily to their offices in Coral Gables, the future use of office space has become a paramount question. With so many able to work remotely, will the working world ever return to its “normal” past?
“We’re all trying to figure out what the new norm is going to be,” says Thad Adams, one of the Coral Gables Chamber of Commerce’s two representatives on the city’s Business Recovery Task Force. Adams works as a senior vice president for commercial leasing at the Allen Morris Company. “I think that remote working is here to stay. We are repopulating the offices in a progressive manner that allows social distancing and safety in the work environment [but] studies show that the majority of people are interested in working at home, at least one or two days a week.”
Adams says that companies will maintain their office footprint for now, especially for face-to-face meetings with colleagues, but that the future could see downscaling. “One trend we are seeing is companies wanting to leave high density locations, such as high rises, due to time in elevators. We are seeing companies looking to move into submarket centers,” he says, which bodes well for Coral Gables.
William Holly, the president of Patton Real Estate, agrees that Coral Gables is better positioned than other submarkets. How COVID will impact the commercial market, however, remains to be seen. “Commercial leasing is in a transition period because you had a couple of months where people were not comfortable going to work – in fact were told not to go to work unless they were in an essential industry – so there was no touring of new space.” The future, he says, will unfold on a building by building basis, depending on things like security and the number of elevators per occupant.
One sector sure to benefit from the office fallout is shared workspace, which gives companies greater flexibility in their leasing. “Companies that were committed to long term leases will be looking for flexible alternatives as they come up for renewal,” says Laura Kozelouzek, founder and CEO of Quest Workspaces, which has two shared workspace centers in the Gables. “There will be a shift to more flexible arrangements as long as you can provide a private space component.”
Unlike places such as WeWork, with large open spaces where entrepreneurs can co-work, Quest offers individual, closed offices in addition to shared facilities like conference rooms and cafeterias. Kozelouzek says right now private space is essential, because it is often difficult to make clients wear masks at all times. “All of our client spaces are private offices and not open spaces, so once they go into their offices, they can take their masks off,” she says.
Rishi Kapoor, whose Location Ventures firm recently opened a new 9,000-square foot shared workspace on Alhambra called Forum, is also bullish. “We think we will do quite well,” he says. “We have had major businesses come to us over the last few weeks.” Like Quest, Forum maintains shared facilities but leases private office suites that can accommodate between one and six workers. “There is no doubt in my mind that flex space will represent a much higher percentage of total commercial office space than it does now.”
Going Back to the Office… Slowly
Gables Employers Are Gradually Bringing Their People Back
After closing in March, SMGQ Law reopened on May 26 with flexible schedules for its 30 attorneys and 25 staff members. “Our attorneys and staff have all been working from home handling clients’ questions about employment, federal aid programs and other matters,” says Pablo Quesada, a founding partner.
Before reopening, the law firm instituted a number of precautions, including social distancing and face mask requirements, as well as a new Plexiglas shield in the reception area. “Clients now go straight to the conference room, to avoid congregating in the lobby,” he says. “After a meeting we wipe everything down… We also instituted shifts for our kitchen, while opening up our lounge and conference rooms, so people could enjoy lunch in the office without feeling crowded.”
Cherry Bekaert LLP, a professional services firm with 100 employees, never closed its Gables office; it merely went skeletal. “We are considered an essential business, so we always had one or two people in the building each day, while the rest of our team worked remotely,” says Mark R. Giallonardo, partner in charge. “We are still in that mode. Most of our employees would love to come back to the office, at least on a limited basis. But we want to make sure they are safe.”
Coral Gables’ largest employer, the University of Miami, is also encouraging staffers to work from home. “We want people to telecommute to the greatest extent possible,” says Matthew Shpiner, director of Emergency Management. However, some employees, including those involved with research and teaching, need to be on campus. “We have been retrofitting our office spaces, installing shields at common points of contact, and preparing ‘safe return kits’ for faculty, staffers and students,” says Shpiner. “Making this environment safe is the leading item on our agenda.”
THE WAY OUT
As the recovery moves forward, the perennial question is what can be done to help and to make things easier for the hardest hit. One of the biggest lifelines has been the SBA’s PPP that supplies grants to small businesses so they can retain staff.
At Professional Bank, which serves many doctors, lawyers and small businesses, one early shift was offering customers government loans, mainly through the PPP. “We proactively jumped on it,” says Abel Iglesias, president and CEO of the Coral Gables-based bank with $1.7 billion in assets. His team perceived its role as a front-line responder for the economy. “We pretty much transitioned our organization to turn things upside down, from a high-touch, low-volume bank to almost a retail factory-like operation to process an onslaught of PPP applications that came through.” In all, Professional approved more than 1,300 PPP loans topping $215 million.
Even with help covering payroll, the cruel fact has been that many restaurateurs and retailers simply went without any sales, or any substantial sales, for several months. “The fact is that most small businesses live revenue day to revenue day, like people with a paycheck,” says Kaplan. “Losing so many months is a challenge. Every business will be its own story, but as soon as landlords crack down on tenants you are going to see some small businesses closing.”
Barbara Tria, who is a specialist in agreements between tenants and landlords, says that options run the gamut from granting outright abatements or reductions in rent, to deferring those payments to a later time. If no compromise is reached, landlords can evict tenants who don’t pay, “Though I’m not sure what positive outcome that provides,” says Tria. “I’m not seeing a situation where multiple tenants are waiting in line for particular spaces.”
“We have tried to work with all of our tenants,” says Marc Schwarzberg, partner in Maven Realty, which has a number of restaurant tenants on Giralda Plaza. “It wasn’t about rent as much it was about staying alive. These are small, independent businesses where the owners came in and worked their asses off.” Schwarzberg says each tenant was dealt with individually, going so far as to look at bank statements. “It’s been difficult to craft a consistent approach, in particular in regard to our restaurant spaces, who were specifically caught in the lockdown. [But] all have now reopened and we are not evicting anyone.”
Individual cases of extreme financial stress led even the Coral Gables Community Foundation to help out local retailers, something they don’t ordinarily do. From their Community Response Fund, they were able to issue a half dozen micro grants, such as a $2,000 grant to Chocolate Fashion on Andalusia. “We felt we had to support some of our small businesses that were really hurt by the shutdown,” says foundation director Mary Snow. Says the owner of Chocolate Fashion, Persy Berger, “Their help was critical for our survival.”
Help From the Top Down
In the fight to help Coral Gables small businesses survive, a crucial weapon in the war chest is support from the city itself.
As 2020 began, city officials had plans to aggressively lure new businesses to Coral Gables, in particular targeting financial firms in the Northeast looking to escape high taxes and winter weather. “And a lot of companies were looking,” says Julian Perez, director of the city’s Department of Economic Development. But when the pandemic hit in March, “We had to reorganize ourselves,” says Perez, “to concentrate on the companies here and minimize the impact of the crisis.”
Using a model from Salt Lake City, his department surveyed local businesses to gauge their concerns. Of more than 140 responses, 75 percent said they would rely on technology to make up for in-shop customers, but only half said they had the infrastructure to do it. Equally troubling, 50 percent of surveyed businesses said they needed training in digital marketing analytics to target customers.
Perez had his team put together business technology webinars, which began in late May, through which local business owners could hear from academics and city cyber experts on strategies to stay alive. Webinar presenter Sara Rushinek, a professor of business technology at the University of Miami, even volunteered to link struggling businesses with tech-savvy students looking to replace virus-canceled internships. These partnerships helped businesses learn to use social media and Zoom conferencing, for example, to decrease costs and increase sales.
Other programs were also launched. The city joined forces with the Coral Gables Chamber of Commerce to hold a small business recovery workshop, with panelists that included the city’s retail strategist Francesca Valdes, who subsequently launched a series of webinars on best practices and tactics to optimize sales and inventories. “Everyone needs to be more efficient. Everybody is going to have to reinvent,” says Rushinek. “Even [small businesses] who have a strong following and survived the last recession are going to be suffering.”
THE REOPENING TIMELINE
Golf Courses, Tennis Courts
Hospitals & Doctors Offices
Retail Stores, Offices, Personal Grooming
Gyms and Fitness Clubs
The Mask Order
Both the chamber and economic development also worked with the Business Improvement District, whose mission is to market the small downtown businesses. In addition to beefing up their online component to promote demand for downtown stores and restaurants, “The BID purchased 5,000 masks and distributed them to all the local businesses, so nobody had to turn away any clients,” said Hornick, a volunteer member of the BID marketing committee.
At the suggestion of Vice Mayor Vince Lago, the economic development department also set up a Business Recovery Task Force (BRTF), a kind of brain trust with eight members; two were appointed by the University of Miami, two by the Chamber of Commerce, one by the city manager, one by the Community Foundation, one by the BID, and one by the city commission as a whole.
“We were initially meeting weekly, and now we meet every other week,” says task force member Susana Alvarez-Diaz, a UM professor of entrepreneurship. The BRTF, she says, has recommended “a heavy push for these small businesses” that make up most of the employers in Coral Gables. “We are very mindful to stay in line with state and county guidelines to make sure we don’t impose anything that would be detrimental to the businesses,” she says. But with that in mind, they have recommended that certain streets be closed so that restaurants can use them for outdoor seating, that permits for outdoor seating on Miracle Mile be less restrictive, and that signage regulations be relaxed for retailers who want to let the world know they are open.
They have also been trying to think outside the box, with recommendations for safe outdoor events for certain target markets, such as seniors, singles or families with children. “A lot of cities have talked about drive-in movies,” said Alvarez-Diaz. “I have discussed cultural events where you drive past different entertainers, maybe down one long street. Something different for the family to get out and feel safe, something fun, something cultural… we need ideas that speak to the time we are in.”
Ultimately, even with the most creative ideas, it will be the public response to COVID-19 that will determine the economic revival of Coral Gables. For small businesses, staying afloat as the economy reboots will rely on innovation, but also the public’s willingness to shop locally. Everything else will ripple outward from that.
“It is really hard to say how many businesses will come back, because we are still in crisis mode,” says Perez. “My personal gut feeling is that there are certain businesses that will do well, because they have adjusted and have an established clientele. We live in a community with a strong identity, that identifies with its business community. There are a lot of people who feel that way, with a lot of pride. That is something that we have that other communities may not have, and that is great to have in these times.”
–– Additional reporting by Richard Westlund and Doreen Hemlock