Business/Economy

For many Anchorage restaurants, the decision to reopen for dine-in service isn’t easy

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On Monday, the Municipality of Anchorage lifted regulations intended to slow the spread of COVID-19, allowing restaurants to open their doors for scaled-back dine-in services.

But Sun Kim, owner of Sushi & Sushi in Midtown, decided to stay closed for dine-in and is only running takeout service.

For Kim, reopening isn’t worth the risk.

She’d have to redesign her entire system and retrain employees to comply with the strict sanitizing and contact regulations for dine-in, she said. And at the required low customer capacity, servers would not be making enough money in tips.

As city and state COVID-19 restrictions begin to be loosened, many other Anchorage restaurant owners say the choice to reopen isn’t so simple.

“It’s a lot of unprecedented decisions and variables to work through, much less the stress and challenge of opening and operating in this environment,” said Jonathan White, owner of SteamDot Coffee. “It’s kind of like the twilight zone.”

Reopening a restaurant is contingent on following strict new public health precautions. It also forces restaurant owners to weigh the safety of both customers and employees.

“On one hand, you’ve got this pressure now to reopen,” said White, who is reopening two of three SteamDot locations for takeout only. “But there’s a lot of uncertainty I’m certainly feeling about putting my staff at risk and potentially customers also.”

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It’s a decision further complicated by financial factors, sometimes including a restaurant’s ability to access and use federal coronavirus relief funds. Even with the federal aid, after taking such a big financial hit during the shutdown, many restaurant owners worry they still won’t make it.

That includes Aren Martin, who owns The Perfect Cup, a cafe inside the Dimond Center mall that has been in operation since 1977.

“The restaurant industry is going to be permanently changed after this,” said Martin. “It’s impossible the way the business models work.”

Strict protocols now require each restaurant to develop a COVID-19 mitigation plan. Tables must be at least 10 feet apart. Servers must wear masks, frequently wash hands and avoid contact with customers. A reservation ledger must be kept with full names and phone numbers of customers, so that in the event of an outbreak, anyone who may have been exposed can be tracked down.

Martin’s business depends on foot traffic in the mall, and takeout from his location is just not a good option, he said.

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“At 25% capacity, you can’t run a business," Martin said. He needs 300 to 400 customers a day just to break even.

Martin did apply for a federal Paycheck Protection Program loan. But unless he uses 75% of it for his employee payroll — which isn’t feasible while operating at a quarter-capacity — he will also end up owing that money, he said, on top of rent.

“There’s no point in reopening in two to three months owing the Small Business Administration $160,000, possibly owing the mall $100,000,” Martin said. “It’s pretty painful.”

Sarah Oates, president of the Alaska Cabaret, Hotel, Restaurant and Retailers Association, said many other restaurant owners who received the federal loans are in a similarly tough position.

Some furloughed restaurant workers don’t want to return because of reduced hours under the 25% capacity requirement and tips slashed by the limited number of customers, she said. Some make a higher income from unemployment.

“It was their plan to use those funds toward payroll. It wasn’t their plan for employees to refuse to come back to work," Oates said.

Additionally, SteamDot owner White cautioned that if revenue isn’t recouped this summer, a lot of businesses that received federal aid will be back where they started.

“Once those PPP loans run out, a lot of businesses are going to be in the same boat and have to lay people off," White said.

Gwennie’s Old Alaska Restaurant owner Ron Eagley said he’s also worried about summer revenue. He’s in a better position than others, he said. Eagley’s mortgage is paid off, and he expects Gwennie’s to survive.

Still, he’s making less than half his usual revenue, even with dine-in service. He made the choice to open the restaurant for dine-in service on Monday morning.

“We’re able to put more people to work, which is what we want to do,” Eagley said. “Our customers are happy to get to come in.”

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But training employees for the new health protocols has been a huge challenge, said Gwennie’s manager Selena Tucker.

“They don’t want to mess up. They don’t want to be the one. They want to get it right the first time,” she said. “There is a huge amount at stake here.”

That is being felt across the restaurant industry, Oates said.

“A lot of people believe there’s a lot riding on phase one,” Oates said, referring to the first part of Mayor Ethan Berkowitz’s three-phase plan to reopen businesses. “If coronavirus flares up big time, then businesses might get shut back down completely.”

Most restaurants won’t be able to financially handle reopening, only to shut down again, Oates said.

“A lot of restaurants right now know that there will only be one chance," Oates said. “It’s a big investment to reopen.”

But for some restaurants, Oates said, reopening this week for the scaled-back service is a financial lifeline.

Without it, “people are literally looking at losing their entire livelihoods,” she said.

Kim of Sushi & Sushi says for her, opening for dine-in is daunting for another reason: She worries that her employees could be at risk of racially motivated attacks.

Kim, who is Korean-American, said COVID-19 has stoked racism against Asians in the U.S. after the disease first broke out in China. Her husband was recently screamed at during a supply run to Costco, she said. Now, they use curbside pickup as much as possible.

“Asian people now are more scared and I own the biggest Asian restaurant — it’s a big risk for me,” Kim said.

Daily News reporter Alex DeMarban contributed.

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