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How America Could Actually Save Restaurants in 2021

Three resilient, relentlessly optimistic restaurateurs certainly think it’s possible. But they also believe it will take bold, urgent action from the government to make it happen

When my parents bought a restaurant five years ago, the intention was never to turn it into something truly great.

Auntie Pasto’s is a decent red-sauce Italian joint that I ate at once a month while growing up in suburban Hawaii, and I was surprised to hear that they had bought it in semi-retirement after selling off a sushi franchise they had built over the previous 15 years. They wouldn’t have to be so hands-on this time — my mom wasn’t about to join the kitchen and sling chicken parm with the line cooks, and my dad viewed the investment as a useful income stream that would buoy their golden years with minimal changes. Yet I was stunned at their apparent addiction to an industry that can only be described as a massive pain in the ass. Did they really want to stay in the game, after dodging disaster and debt so many times?  

“Well, what are we supposed to do? We’ve run a small business our entire lives, mostly in dining. You want me to start selling stock?” my dad replied, literally chortling at the thought. 

Then the pandemic hit, and they learned in cruel fashion how bad timing can derail a seemingly comfortable future. Thankfully, their neighborhood restaurant didn’t require tourism dollars to function, unlike vast swaths of Honolulu’s hospitality market; hell, most Italian food packed up just fine for takeout and delivery, anyway. But orders dropped by 70 percent, and the loss of in-person dining meant that my parents had to lay off more than half their staff. 

Looking to cut even more costs in survival mode, my dad now purchases and delivers a lot of kitchen inventory himself. I hate the thought of him constantly heading to Costco with a mask on, hoping to sweep up deals on ingredients. Then again, I’m also relieved that my parents are dealing with a generous independent landlord and able to stay afloat. Given that they got barely any PPP loan dollars from the government, it feels like a minor miracle. They know friends and peers who haven’t been so lucky. 

“It felt like the government, both in Hawaii and in D.C., had no imagination, no creativity, no backup plan, no nothing. Your mom and I sat at home watching news reports of what’s happening in New Zealand or Europe, with people getting real advice and money to survive. It felt like an insult by America. And it still feels like that,” my dad tells me over the phone this weekend. 

I heard my mom murmur in agreement. “We had to figure everything out ourselves. Who and how many to lay off, what help we can give them with unemployment money, problems with our vendors and inventory, opening the dining room, closing it, putting chairs outside, not putting chairs outside,” she interjects. “It feels like we’re all alone, and everyone has a different situation, but it’s just hard. Too hard. It’s not right.” 

As the crest of the pandemic hit America in April, the restaurant industry lost three decades’ worth of job growth seemingly overnight. Nearly 6 million jobs disappeared, and while there were flickers of recovery in the summer, the winter swell has led to more job losses in November. By some estimates, a quarter of all independent restaurants will have gone extinct by the time we’re through this economic and health crisis.

In the hopes of brainstorming the blueprint that will get us out of this mess, I reached out to a dozen different chefs and restaurateurs, looking to glean specific insights and policy ideas. Instead, what emerged was a tableau of commonalities — frustration at being left alone in the dark, a desperation for government aid and a restless optimism for the future, marred by the scars already left. Nobody told me they regretted owning a restaurant, even my parents; instead, they underscored the need for bolder, more urgent thinking when it comes to supporting an industry that every American interacts with. 

Since L.A. is currently the COVID capital of the world, I figured it would be wise to give the mic to three of my favorite restaurateurs in the city: a Michelin-star chef with a global audience; a first-time owner of a local bar and cafe; and a longtime restaurateur whose experience bridges the gap. 

I asked them one simple question: How do we save American restaurants in 2021? 

Provide Significant Rent Relief

Andrea Borgen Abdallah, owner of Barcito and founder of advocacy org No Relief, No Rent: When we first got shut down, we made two important decisions that have sort of become the guiding light for everything since, and that was that we had to hold on to our most at-risk employees. We have folks who were formerly homeless that live in subsidized housing and don’t have any options if they lose their paycheck. We decided to stay open largely to secure their jobs. Then we decided that everyone who we furloughed, basically every single member of our front-of-house staff, we would continue to pay for their health insurance. 

We needed money coming in the door in some way, shape or form to be able to maintain those two commitments. But it’s been on us to figure that out. I mean, even with PPP dollars, the plan was to be out of the pandemic by summer, right? And once September hit, especially in L.A., you saw restaurants closing left and right because those PPP funds couldn’t last. 

What’s next? What happens when these eviction moratoriums are lifted? What happens when the vaccine is widely distributed and everyone wants to go back to normal and we have $100,000 in debt in unpaid rent that, as far as we can tell, we’re going to be expected to pay back? What happens to the personal guarantees on these leases, which make it impossible for us to just walk away, and leads to personal liability if I can’t pay everything back?

There was a bill in California to cut down these personal guarantees and free you of the contract after good-faith negotiations, but it left property owners holding the bag and the bill didn’t get anywhere. What we need is something that provides relief for both sides. Not all property owners are ethical, but it’s important that they shoulder this burden with us and demand relief with us. Otherwise, it’s always going to be us-versus-them, and at the end of the day, the government gets to wash their hands of the whole thing.

There are a lot of restaurant owners who were already withholding rent. They were fighting their own individual battles without a collective voice or agenda. So my goal is not to try and convince the entire City of Los Angeles to stop paying their rent. My goal is to get the ones who already aren’t to join us and then see where we land as a collective force. The Restaurants Act would alleviate so many issues, rent principally among them. Outdoor dining isn’t going to save us. Not by a long shot. 

Don’t Let the Government Make Decisions on the Industry’s Behalf

Dina Samson, co-owner of Rossoblu and Superfine Pizza and co-founder of advocacy org Independent Hospitality Coalition: I could say innovation, changing our business models or even eliminating the antiquated tip model, but the reality is we can’t do any of this without the government saying it’s okay first. We have to wait for these legislators, who barely understand our businesses, to make decisions on how we run our businesses.

There’s been very little financial and regulatory help from our local, state and national governments. We’re an industry that’s 16 million employees strong yet our voices aren’t being heard. Our industry is the largest employer in the U.S., second only to the government, yet we’ve had no specific aid.

In order to save restaurants, restaurant owners need to come together to build our seat at the table with these government officials because they aren’t going to invite us. We need to make sure we’re helping create the laws/regulations that we have to live by.

Hand Over the Same Kind of PPP the Airlines Got

David Myers, Michelin-starred chef, global restaurateur and co-owner of Adrift Burger Bar: For me, it was impactful from the beginning —  we got hit in Asia first, so we put our workers on hold, our restaurants, me, all of it. Then you start wondering, “Well, how will we make it through this?” I spent one painful, scary second dwelling on the worst-case scenario, but then I decided that I needed to live in constant forward motion, no matter what, even despite the fear and wanting to hide. So we went ahead and decided to launch Adrift, decided we’re going to push forward on developing our brands, we’re going to come up with more concepts, we’re going to dive in deep on social media platforms and hire new talent. 

I wanted to attack the moment, not retreat. And I wanted to move forward in the hopes, and it’s a lot of hoping, man, that we’ll get to a vaccine and past the uncertainty and be in prime position to sprint out of the gate. This was wishful thinking that became real risk and debt, and if our cash flow didn’t hold up, we were in real trouble. But I was willing to take the risk. And we’re still going for it, and fortunately, we did get a business off the ground — and our businesses in Asia are reopening. 

I do think we’re going to have a massive wake of damage, especially in the U.S. It’s completely unacceptable, and unfair, for anyone in the restaurant industry. The airlines have gotten a massive bailout, and we’re getting relatively nothing. You have to understand, we’re a pennies business — independent restaurants aren’t rolling in dough. Yet the restaurant industry has been first to step up to other charitable moments, in times of need, donating whatever we can to help others in a humanitarian crisis. I just feel so bad for everyone who’s been left behind, and whose businesses will shutter and not reopen ever again. 

The government needs to pony up some serious money, just like it has done for other industries during crashes, whether it’s the banks or airlines. We don’t have, as restaurateurs, the capacity to simply go out and raise money. Nobody just gives money to restaurants. Banks don’t give loans because restaurants have a high fail rate, investors don’t want to sink money into something they think can fail again. So we need a creative way to help get money to restaurants and alleviate the challenges. Landlords still want money. Employees still need wages, and so do vendors — and now they want the money upfront before bringing you a delivery. 

Large chain restaurants were the ones who got the vast majority of PPP aid money, not independent restaurants. Nobody works harder than cooks, front-of-house staff, bartenders and restaurateurs. This is a decimated industry, and if people want to go out and have great restaurant experiences again, something needs to change.

* * * * *

After my conversations with these three, I couldn’t help but think about David Chang’s recent reflections on whether the restaurant industry should even look the same after this reckoning. The problems with wages, the growing instability of restaurant jobs and the sustainability of many operations looms large, especially with an American workforce reeling from 2020; even before COVID, a staggering one out of six restaurant workers were living below the poverty line and facing a 75 percent employee turnover rate (compared to 49 percent for the rest of the private sector). Tipping has screwed too many people out of money, health-care coverage is spotty and immigrant labor continues to be the fulcrum for cheap eats. 

How do we save restaurants in 2021? The answer is one part money: The federal government has it, and it’s willing to spend it, but not (yet) on the dining industry. The second part, though, is by fundamentally re-envisioning what sustainable, ethical restaurants operate like. “The iceberg for restaurants wasn’t COVID-19,” Chang recently told Bloomberg. “Something like that was going to happen, and change was coming.”

As we turn the page into a new year, the damage of that iceberg is crystal clear. It’s time to lower the lifeboats — for my parents and everyone else. 

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