Note: It’s been almost a month since the NB Indy checked in with Newport Beach Chamber of Commerce President and CEO Steve Rosansky on how businesses were faring amid the coronavirus epidemic. Now that retail and restaurants are beginning to reopen, albeit with specific guidelines, NB Indy writer Richard Simon asked Rosansky for a business updated.
Q: Have you received any comments from the Irvine Co., as to their position on reopening?
A: Although most shops in Irvine Co. retail properties around the City closed as a result of the Governor’s orders, a fair amount, mostly restaurants and banks, have either re-opened, or never closed. Recently, another group of stores re-opened when curb side pick-up was permitted. I imagine that we will see many more re-open as a result of the permission granted by the California Department of Public Health (CDPH) last Saturday for retailers to open as long as they implement safe practices and social distancing in their stores based upon a set of recently issued CDPH Industry Guidelines. I fear that there will also be a number of stores that never re-open or only stay open a matter of months before the lack of customers and/or the cost of doing business renders them unprofitable.
Q: Do you have information from local hotels?
A: The hotel industry in Newport Beach has been devastated. At this point half the major hotels in town remain closed including the two Hyatts, the Renaissance and the Fashion Island Hotel. It doesn’t appear that any of them have re-opening dates set yet. There is also a possibility that the Fashion Island Hotel will remained closed until the end of the year so that they can implement a robust refurbishment of the hotel that was already in the planning stages prior to the COVID-19 outbreak.
Of the major hotels that remain open, the Marriott, Pelican Hill, the Balboa Bay Resort and Lido House, all have been suffering with extremely low occupancy rates (5 to 25 percent). Recently they have been seeing an uptick in leisure travelers wanting to visit Newport Beach even though many of the hotel amenities like restaurants and spas are not open and room cleaning during their stay was not available. Many of the smaller properties also closed and have remained unopened like the Newport Channel Inn. Others on the Peninsula have stayed open like the Balboa Inn and the Holiday Inn Express, but are also seeing reduced numbers of hotel guests. Word is that although things should improve as we move through summer and into the fall, we are probably looking at overall occupancies of 50 percent or less for the rest of the year. This past Memorial Day weekend has been a bright spot and of the hotels that have stayed open, many were close to full.
Hotel stays are only one piece of the pie. Hotels also derive a significant portion of their revenue from weddings, meetings and conferences renting ballrooms and meeting spaces as well as income from spas, restaurants and other amenities which has all disappeared. Even with a return of leisure and business travel, restrictions on attendance at events will limit the group business that many of these hotels rely on.
Q: What about short-term lodging?
A: That industry in Newport Beach has been hard hit. Many of the local booking agencies have seen cancellations soar up to 90 percent and the City Council only recently lifted the ban on short term lodging rentals. I have received calls from people all over the country wanting to know whether they should cancel reservations because they heard that beaches and shops were closed. I think going forward they will do better than the hotels but they will also suffer a significant loss in revenue.
Q: Does the Chamber have opinions or comments on the current state guidelines, and the state’s loosening of various strictures?
A: Governor Newsom has taken a very slow and deliberate approach to the re-opening of restaurants and retail establishments as well as office and industrial workplace environments. The Chamber has been supportive of City and County actions which have tended to default to the State for guidance. At this point we are fully in Stage 2 of Newsom’s 4 stages of opening. We are encouraged by the recent removal of the blanket prohibition on in-restaurant dining and in-store shopping at retail establishments. However, even with the removal of the closure orders, the California Department of Public Health has laid down some very strict guidelines for restaurants and retailers to follow in order for the public to safely re-visit those venues through the implementation of social distancing, health and sanitation mandates.
The Chamber has worked with the Newport Beach City Council and City Staff to come up with an Emergency Ordinance that will help offset some of the loss of floor space and occupancy due to these restrictions by allowing the use of adjacent sidewalks, patios and parking lots to service their customers. We also look forward to the day when our personal service providers can open as well as movie theaters and entertainment venues.
Q: Have your members offered their opinions as to state and local controls, and can you share these?
A: In general, the Chamber’s membership has understood the need to lock down the state through the implementation of the Governor’s stay at home orders. However, almost everyone is itching to get back to business. More recently, some have expressed the opinion that perhaps the Governor was moving too slow towards re-opening and that the State’s economy was unduly suffering as a result. I think where we are today is a division in philosophy as to how much social distancing and mask wearing is necessary and whether these safety measures should be mandatory or voluntary, especially on the part of the customers. I have heard from some shop owners who have been disheartened to see neighboring stores not following the rules by re-opening too early and/or not providing a safe environment for their employees and customers. They think everyone should be on a level playing field and follow the same rules.
Q: By your understanding, how will guidelines be monitored, and by whom?
A: My understanding is that as we have seen up to this point, there will be very little, if any, monitoring of the guidelines that businesses need to follow in order to re-open. I haven’t heard of any enforcement actions by City, County or State agencies other than an occasional “educational warning.” That being said, people who hold state licenses such as for alcohol sales or professional licenses like hair stylists, massage therapy, barbers, estheticians, manicurists and dozens of other state issued licenses could be subject to revocation of their license for non-compliance with the guidelines. At this point, although the Governor has threatened to do so, no licenses have been revoked and I doubt any will. We may see some enforcement of the restaurant guidelines developed by the Orange County Health Care Agency. They have a significant inspection and enforcement division that already visits restaurants on a regular basis to verify compliance with health codes and health department orders that existed before the COVID-19 pandemic. I could easily see a situation where, as part of a normal inspection, they cite a restaurateur for non-compliance.
For more information, visit www.NewportBeach.com.