A restaurant-closing tsunami is on the way, New York restaurateurs warn

"They’re not seeing a wave of closings yet because people are still trying to hang on."

People walk by restaurants' outdoor patios after New York City Mayor Bill de Blasio announced 21 more locations for outdoor dining options in Manhattan, New York City, August 14, 2020 (photo credit: ANDREW KELLY / REUTERS)
People walk by restaurants' outdoor patios after New York City Mayor Bill de Blasio announced 21 more locations for outdoor dining options in Manhattan, New York City, August 14, 2020
(photo credit: ANDREW KELLY / REUTERS)
Restaurateurs in New York are warning of a restaurant-closing tsunami as summer turns to fall, due to the ongoing coronavirus restrictions.
Danny Abrams and his partner Cindy Smith run seven restaurants in New York, but after more than 17.5 years in business with the Mermaid Inn in Manhattan's East Village, they have shuttered the restaurant, citing the lockdown.
"Our lease expired on August 31st and we were not able to come to an agreement with the landlord on how to move forward both during and after the pandemic," they explained in a heartfelt Facebook post titled 'The Mermaid Inn at 96 Second Ave Farewell Letter.'
The post detailed the impact the Mermaid Inn had had in its 17-and-a-half years in business, including having more than 3,000 employees, paying out over $15 million in wages, contributing $2.1m in city taxes, paying over $15m. to suppliers – including small, private businesses – and welcoming more than 850,000 guests to dine.
"Now, multiply that by THOUSANDS of NYC restaurants closing." they wrote.
New York businesses are eligible for some government assistance, but Abrams and Smith said it wasn't nearly enough.
"The Payroll Protection Program [PPP] has given us eight weeks of funds for what will be a 52-week problem," they said. "And look at who that money was allowed to pay: We were only allowed to pay for payroll (which is good) but [we] also [had] to [pay] the landlords, the insurance companies and the utility companies. Think about that for a second. Real estate owners, insurance conglomerates and large utility providers. Not one cent could go to the hundreds of small business that had provided us with goods and services."
Now they have warned that the city's restaurant scene is teetering on a knife edge.
“I think there’s a restaurant-closing tsunami on the way,” Abrams told Restaurant Business. “It’s going to happen after September. They’re not seeing a wave of closings yet because people are still trying to hang on, and people are still playing with some of the PPP they might’ve gotten."
In the Facebook post, Abrams and Smith detailed how continued uncertainty paired with restrictions on the number of guests restaurants can welcome have both taken their toll.
“We really needed May, June, July, August, September,” Abrams told Restaurant Business. “If we miss that window and then [only] get to do 50% in October [and] 50% in November? Forget about it.”
The pair have owned and run a number of restaurants in the city over the last two decades, including one they opened six blocks north of Ground Zero just weeks after the twin towers fell.
"It was the first BUSINESS to open in Tribeca after that tragedy," they wrote on Facebook. "We have felt the outpouring of love and resources available when the government has the will. We got through the Sandy Blackouts. We survived (barely) the Great Recession. [But] we may not survive this if there is not some action at the state and federal level."
They warned that if the city's restaurants fail, the city itself will take a big hit, not just in financial terms but in the tenor of the city's life.
"You won’t feel that energy over a ZOOM call," they warned. "And if that becomes the norm and somehow replaces the energy that we have come to love and expect from NYC, then maybe, just maybe, we will have to move out as well. And your beloved NYC restaurant will disappear as well."