San Diego County businesses fear they may not be able to survive another indoor shutdown due to COVID

Pandemic-weary businesses, hit with the third shutdown of indoor operations in eight months because of

Pandemic-weary businesses, hit with the third shutdown of indoor operations in eight months because of rising COVID-19 rates, fear they may not survive this time around as they watch their customers — and financial reserves — evaporate.

From restaurants, bars, gyms and movie theaters, which will soon be limited to outdoors-only service, to shops and malls where indoor capacities will drop to just 25 percent, the news Tuesday that San Diego County will enter the most restrictive tier of the state’s reopening system is yet another financial blow to both the owners and their workers.

Businesses are yet again preparing to make the gut-wrenching decision to let employees go or sharply reduce their hours while they contemplate the possibility of closing their doors — either temporarily or for good.

Some still are hopeful they can make a go of it over the next several weeks, while still others are weighing the risks of flouting the new rules, scheduled to go into effect at 12:01 a.m. Saturday,and remain open for indoor service.

“Some restaurants are at a do-or-die situation, while some can survive with outdoor seating and to-go orders,” said restaurant owner Ben Clevenger, who is also president of the San Diego chapter of the California Restaurant Association. “I know of a few businesses who don’t have a choice and are going to have to stay open indoors. If they don’t, they’ll lose their business anyway so they might as well go down fighting.”

Clevenger himself, who owns the Eastbound Bar & Grill in Lakeside, says he plans to continue serving patrons at his 10 tables inside, in addition to 10 more outside.

“Right now we’re going to keep doing what we’re doing and try to keep the lights on and keep our employees’ jobs open,” he said.

Some venues are more coy about their intentions, while many more say they are unwilling to risk the possibility of losing business and liquor licenses by defying the public health orders and will try to weather the pandemic as long as they can.

For Cowboy Star in East Village, which is unable to serve customers outside, the possibility of continuing to do business indoors will be a “game-time decision,” said John Weber, who has owned the restaurant with his wife Angie for the last 12 years.

“The first time we shut down, we spent our own money feeding those we had just fired,” said Weber. “Now our paycheck protection money is gone, so if we close there’s a 90 percent chance we won’t reopen. We’re ruining people’s lives, it’s people losing their livelihoods. Come on in when I have to lay everyone off and watch the tears and see if you want to just call it a rollback.”

The prospect for potential defiance comes as county officials warned Tuesday that they will be stepping up enforcement as San Diego County transitions to harsher restrictions.

“To those businesses out there, it’s certainly not the county’s desire to close anyone,” County Supervisor Nathan Fletcher said during a news conference. “But because of COVID it is a global pandemic that forces us in this situation where the higher risk type entities have to take a temporary pause on indoor operations … So our hope is those businesses will understand, will comply and if they choose not to, then we will have compliance teams there that can issue public health orders to require their closure, and law enforcement has the ability to ticket them and fine them, but we don’t want it to come to that.”

Longtime restaurateur David Cohn said the move into the more restrictive purple tier will mean making the painful decision to permanently shutter three of his restaurant group’s nearly two dozen San Diego County venues — the 3-1/2-year-old Tacos Libertad, which donates all its profits to charities; BO-beau, and a connected speakeasy, Cache, all in Hillcrest.

The Cohn Restaurant Group is also pondering the idea of temporarily closing some restaurants as a practical financial move as the company waits out the virus and the continued cycle of closings and reopenings that are inextricably linked to surges and dips in coronavirus infection rates.

“We’re going into the winter and viruses spread more in the winter. You can only have so many heaters to make it work,” said co-founder David Cohn, who has some coastal restaurants like those on Harbor Island that are better positioned to succeed in an outdoor setting. “One of the things we’re looking at is going into hibernation mode where we close for three to six months and not do this opening and closing thing, which is a very difficult and stressful decision.

“The real decision owners have to make is, am I losing more money by staying open than closing.”

It is a decision many retailers are also going to have to wrestle with, as the crucial holiday season approaches and brick and mortar stores continue to compete with increasingly popular online shopping options.

Kimberly Jonell, the owner of Replay Toy Boutique in North Park, said she has managed to stay open, with her landlord giving her a break in rent and by moving as much as she can online. She said her revenue is about half of what it was at this time last year and, although she didn’t want to say how much, is losing money on the business.

“My accountant already thinks I should close,” Jonell said.

She said she watches her capacity, cleans frequently with antibacterial products and requires masks. As far as reduced capacity with a demotion in tiers, she said she wasn’t even aware there might be a change until she was called by The San Diego Union-Tribune.

“I don’t exactly know what all the numbers mean or what all the levels are or what we are supposed to do until they really put it in place,” she said. “Usually, one of my friends texts me and is like, ‘Guess what?’”

San Diego bar owner Rachel Dymond is keenly aware of every step forward and backward as she and her business partner, Andrew Haines, struggle to navigate the ever-changing coronavirus landscape for businesses. Their Carriage House karaoke bar in Kearny Mesa was just starting to see financial success, after moving three years ago to a larger location, when the pandemic hit. Eliminating indoor drinking and eating, in combination with a 10 p.m. curfew, makes survival tenuous, she says.

“We’re down 75, 80 percent right now,” Dymond said. “We are unable to pay rent, they’re after us every month but I don’t want to give up my dream so we do what we can. People aren’t going to come if they have to sit outside, and we don’t really have money for heaters. You’re operating at 25 percent capacity now, how can you make money? We can pay our utilities, but nothing else is coming in.”

San Diego County Supervisor Jim Desmond said Tuesday he felt movement into the purple tier was too harsh but the county did not have many options other than complying with the state order. County staff had worked hard to persuade the state to let the region stay in the red tier, but state officials would not budge.

“There’s not much we can do, other than plead to the state,” he said. “Our hands are tied.”

He acknowledged several types of businesses that are affected are the same ones where county health officials have said outbreaks occurred. But he said the limited risk at, for example, a mom-and-pop restaurant, did not warrant closing all indoor operations.

“The punishment does not match the crime,” he said.

David and Argelia Granda and their two adult sons have been working long days seven days a week to keep their two Maggie’s Cafe locations — in Barrio Logan and Serra Mesa — open, but shutting down indoor operations could prove fatal to the business, David worries. His cafe in Serra Mesa has no patio seating.

“If we have to close indoors, we’re probably not going to survive. We’re not a family with big pockets,” Granda said. “We depend on our daily customers spending money, and our employees worry about losing their jobs. We would love to be rebels and stay open but we also want to keep our employees and customers safe.”

For indoor movie theaters, they have no choice but to shut down completely. In the existing red tier, they had been able to operate at 25 percent capacity or 100 people, whichever is fewer.

Aside from the bigger chains, like AMC, many smaller cinemas are already closed. Some theaters, such as the Vintage Village Theatre in Coronado, never reopened. Others, such as the UltraStar in Mission Valley, reopened but then shut down again.

UltraStar resumed operations in mid-September after closing at the start of the pandemic. It hired back 15 workers and installed a new HVAC system, put in plastic barriers to protect workers and customers, as well as bought new disinfectant systems for seats.

In early October, it shut down again because of a lack of new movies being offered by Hollywood studios, which has pulled its big features for the year.

The county’s biggest movie chains, Regal Cinemas and AMC, did not respond to requests for comment. The companies operate about 15 theaters throughout San Diego County.

The news is not grim for all businesses. Some gyms say they have thrived in the pandemic as they made adjustments to move equipment and classes outdoors, although many do not have that advantage.

“Obviously, we would love to keep the business indoors,” said Stephanie Rue, director of operations development for the gym chain, EōS Fitness, which has three locations in San Diego County. “But, we always want to be supportive of our local governance and make sure members have a safe experience at the same time.”

Rue said she couldn’t give out financials, but the company is doing well in that it had added nine new clubs across the nation since the pandemic began. The national chain, based in Arizona, has locations in its home state, Nevada and Utah where gyms are all open.

Rue said members are allowed to pause their memberships if they don’t want to exercise outdoors, but the gyms are mostly seeing enthusiasm from people who want the opportunity to exercise.

“Our experience has been overwhelmingly positive,” Rue said.

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