No industry has been hit harder by Covid-19 than the hospitality business, with mandated bar and restaurant shutterings devastating the sector across the nation. Some on-premise operators turned to delivery and pick-up options, but those amounted to just a fraction of normal sales. At many higher-end restaurants, to-go wasn’t a viable option, and so the lights went dark.
Now, as cities finally begin to reopen, venues are adapting to the new environment, balancing health and safety precautions with their operating procedures and profitability requirements. Hopes are high, albeit tempered by cold recognition of the challenges ahead. States including Texas, Florida, Iowa, and Missouri were early leaders in reopening efforts, with many others following in recent weeks. Governors have rolled out phased plans that include specific rules, from operating at low capacity to implementing social distancing guidelines among guests and staff. Some states have allowed bar operations to reopen, which will be a key factor in the on-premise recovery.
MGM Resorts, whose presence dominates the Las Vegas Strip, had to furlough almost 63,000 employees during lockdown, as every one of its 20 U.S. properties closed, including 13 Las Vegas casino-resorts and seven venues in other cities. Las Vegas allowed the reopening of restaurants and bars off The Strip in mid-May in limited capacity, and in early June unlocked The Strip with heavy restrictions, including 50% capacity limits for hotels and on-premise venues, mandatory temperature check points and Covid-19 testing stations in casinos, and strict disinfecting and social distancing protocols. MGM Resorts properties installed stand-alone hand-washing and sanitizing stations throughout their casinos and implemented contactless hotel check-in procedures, as well as digitized restaurant and bar menus that guests now must access through their own smartphones.
MGM started by reopening its Las Vegas casino-resorts Bellagio, New York-New York, MGM Grand, and The Signature at MGM Grand, with Excalibur following a week later. Each property opened with limited hospitality options to start, aiming to add more as safety is established and tourists return. Bellagio’s on-premise options started with the lounges Petrossian Bar and Mayfair Supper Club and the fine-dining venues Prime and Lago, while MGM Grand debuted with the drinks destinations Whiskey Down and Lobby Bar and the upscale dining spots Craftsteak by Tom Colicchio and Wolfgang Puck Bar & Grill. MGM Grand also reopened its two Mississippi casinos in early June. At press time, Luxor was slated to open in late June and Aria, Delano, and Mandalay Bay were slated to open in early July.
Las Vegas-based restaurateur and hospitality consultant Elizabeth Blau—founder and CEO of restaurant development company Blau + Associates—operates one venue on The Strip and another location a few miles away in Summerlin, Nevada. Buddy V’s Ristorante in the Venetian reopened briefly before closing again for renovations, with an expected reopening in late summer. Honey Salt, Blau’s Summerlin property, has been open since mid-May. That concept was offering takeout and delivery during lockdown, and opened its doors to on-premise dining at 50% capacity as soon as it was permitted. Half the tables in Honey Salt were removed upon reopening, and hosts and servers wear face masks. Stuffed bears donning masks are holding court on each bar stool, as bar seating remained closed at press time.
“The customers who’ve come in have been so appreciative to be out of their homes and back in the restaurant,” says Blau. She notes that Honey Salt got creative during lockdown, offering a variety of takeout and delivery options with wine, beer, and cocktails, as well as online cooking demonstrations and other virtual events. The restaurant also took part in Delivering With Dignity, a Las Vegas effort that helped deliver more than 35,000 meals to those in need within the community.
“It was incredibly eerie seeing The Strip with the lights on but literally nobody home,” Blau says, noting that Las Vegas’ 42 million annual visitors sustain the city’s economy. “We thrive on convention business, and many have been canceled through the fall and winter. It’s scary to think about our ability to recover economically. While people have been supportive, the financial model of operating at 50% capacity, even for a short time, is untenable. The restaurant industry landscape will look dramatically different over the next few months.”
Chef Emeril Lagasse operates three properties on the Las Vegas Strip in MGM Grand and The Venetian. All were shuttered in March, and are now open with limited capacity. Lagasse also has four venues in New Orleans that were still closed at press time, as well as locations in Florida and Pennsylvania, all of which remained closed. “This has changed the world,” Lagasse said recently on Straight Talk With Wine Spectator via Instagram Live, adding that his company was waiting it out but is eager to reopen. In the interim, Lagasse’s New Orleans restaurants have been providing 1,200-1,800 weekly meals to the city’s doctors, nurses, and first responders. “We’re being patient,” he added. “We have to wait. We talk to our team every day. Everybody wants to go back to work.”
For Danny Meyer, founder and CEO of New York City-based Union Square Hospitality Group, Covid-19 hit close to home, as one of his former chef partners—Floyd Cardoz, an international restaurateur who helmed the restaurant Tabla with Meyer for 12 years—died from Covid-19 on March 25. Union Square Hospitality’s 20-plus venues first shuttered on March 13. “From a business standpoint, we were just thinking about bringing our chefs back to cook for the community [when Cardoz died],” Meyer told Wine Spectator in mid-May. “[His death] stopped us. When Floyd passed away, we made the decision not to try anything.”
While Union Square’s Daily Provisions, Blue Smoke Battery Park, Marta, and Tacococina venues are now open for takeout or delivery—and Union Square Cafe is offering wine pickup—Meyers says the higher-end, full-service restaurants will take much longer to recover. “The thing we’re best at is gathering people, and we’re not supposed to do that right now,” Meyer said. “It’s very frustrating. We’ll get back, though.”
High-end nightlife operator Gerber Group, which has eight properties in New York City and one each in Atlanta and Washington, D.C., closed all of its venues in March, and they remained closed at press time. Because of the company’s nightlife and bar focus, principal and CEO Scott Gerber said he didn’t think the takeout business model would be profitable enough for his concepts. “Most of our venues didn’t have an existing takeout business, and I don’t believe the volume of orders or the safety risks involved for our kitchen staff working in close proximity would justify trying to build one,” Gerber says.
Gerber Group laid off roughly 400 staff members—the entirety of its workforce and corporate team—in late March, though Gerber hopes to rehire every employee once the businesses reopen and customers return. He adds that post-Covid-19 operations will likely include a more streamlined menu to start, as well as enhanced cleaning procedures and enforced social distancing. “The biggest change I foresee is that there will be less, if any, personal touch, in all aspects of the business, from service to passing out menus to processing payments,” Gerber says.
New York City cocktail destination Death & Co. also remained closed during lockdown, as did its sister locations in Denver and Los Angeles. The vast majority of Death & Co.’s staff from all three properties was furloughed, save for a handful of national corporate roles, and the company declined to offer to-go options during the heart of the global crisis. Death & Co. founder and co-owner David Kaplan said that instead of doing takeout, the company looked for creative ways to engage with its online community, support its staff, and create revenue. This included various online retail options and guest experiences.
The company’s website sells apparel and branded drinks merchandise, including books, mugs, tumblers, and flasks (clothing ranges from $28-$60; other merchandise is $12-$119). Meanwhile, the Death & Co. quarantine experiences ranged from a $10,000 at-home party for up to 12 people, including a four-course meal with cocktail pairings, and a $5,000 custom bar cart stocked with mixology tools, Death & Co. books, and spirits and mixers. “We chose to focus on our online retail offerings and on further developing meaningful experiences for our guests that can also be enjoyed once we reopen,” Kaplan says.
Death & Co. has spent a lot of time working on its reopening plan. At press time, the company’s Denver unit was slated to open in late June with a very limited in-house capacity of just 50 guests, as well as limited staffing and a culled-down menu. To coincide with the launch, Death & Co. Denver unveiled a to-go drinks program in late June too, featuring a variety of pre-mixed cocktails and cocktail kits, as well as beer and wine. Kaplan says the company will slowly increase customer counts and menu items as safety and demand allow. They’ll also implement several new safety measures, from enforcing a six-foot distancing rule to various enhanced cleaning protocols, including regular staff wellness and temperature checks and extensive sanitation guidelines for items and seats touched by multiple people.
“It will be challenging—and, let’s face it, awkward,” Kaplan says. “Our reopening beverage menus will consist of drinks from the menus when we closed that we can quickly reactivate, and to-go beverages and food will be offered at each location. Cocktails will be fully prepared and ready to serve, either bottled or vacuum sealed.” He adds that the short-term focus is on reopening safely and rebuilding consumer confidence, which he hopes will happen soon. “We hope to see all of our businesses open by late summer or early fall,” Kaplan notes. “It’s not going to be easy. Some of our favorite places will close permanently and we will lose institutions. Our industry has been decimated. But after this period of suffering I do think there will be a period of rejuvenation.”
For operators with units in multiple cities and multiple states, one of the biggest challenges has been navigating the laws and regulations for each market. Some municipalities allowed to-go sales for beverage alcohol early on during lockdown, while others took months to shift to takeout wine and cocktails and still others never approved the measures at all. Urban Plates is a health-minded dining concept based in Cardiff, California that has 16 locations in California and three in greater Washington, D.C., with more planned in other states. The company shifted solely to takeout and delivery early on, first in Southern California and then Northern California a few weeks later. While its Southern California venues are now mostly open, Urban Plates’ Northern California units remain takeout and delivery only, and its East Coast locations remained closed at press time.
“When dine-in business stopped on a dime, our sales dropped significantly,” says Steve Greer, CMO for Urban Plates. But he adds that after shifting its business model and its health and safety protocols, the company saw a steady uptick in sales in May. As part of its bid to attract new customers during the pandemic, Urban Plates began offering family meals designed to serve four and sold several wine labels at 50% off for takeout, including Seaglass Chardonnay, Babich Black Label Sauvignon Blanc, Decoy by Duckhorn Cabernet Sauvignon, and Fess Parker Pinot Noir (half-price takeout wines were $12-$23 a 750-ml.). As Urban Plates eyes reopening for in-house dining, Greer says several changes will be present. “Our staff will continue to wear masks and gloves,” he explains. “We’ll also move to single-use cutlery, dishes, and menus, refresh drinks with new glasses every time, remove condiment stations, and safely distance tables. We’re chipping away at the challenges we’re facing and putting our best food forward while recognizing that there will likely be a few more twists and turns throughout the year.”
Riding the pandemic roller coaster has been tough for every type of on-premise operator. Hope Ewing, general manager and beverage director for Rappahannock Oyster Bar in Los Angeles, saw her robust restaurant change almost overnight. “We pivoted from being an 80-plus-seat, dine-in restaurant and craft cocktail bar with 30-plus staff to a two-person to-go food and beverage operation,” Ewing says. “It’s been really sad to stop serving people on-premise. We’re running a takeout menu of prepared foods and cocktails, and have had a lot of success selling bulk packages of unshucked raw oysters and shucking knives for people to prepare at home.” To keep the bar front and center, Rappahannock Oyster Bar set up a mini bottle shop in the front of its space, selling wine and spirits and the ingredients for people to make popular cocktails once sold at the bar. This complements single-serve cocktails that are sold in jars for at-home consumption.
Pre-mixed takeout cocktails are also doing well at Little Dom’s in Los Angeles. The restaurant is a sister venue to cocktail haven MiniBar, and while that venue is completely closed, Little Dom’s is seeing success with pre-made bottled cocktails from both its menu and MiniBar. Jeremy Allen, the general manager and head bartender for MiniBar and Little Dom’s, created large-format, family style to-go cocktails during the pandemic, as well as frozen alcoholic slushies.
“Early on in lockdown we only offered the basics to-go, like a Dirty Martini and Old Fashioned,” Allen says. “But week by week, as more venues came online with to-go drinks, we realized we could still have fun and grow the menu, so now we play with specials and more fun drinks. We’re gradually seeing room to expand.” To-go cocktails at Little Dom’s include a Bank Note 5-year-old blended Scotch-based Penicillin ($36 for a 16-ounce jar designed to provide four cocktails) and the Cucumber Mint bagged slushie pouch ($20), made with St. George Terroir gin, Åhus aquavit, and fresh cucumber, lime, and mint. Allen adds that even when both venues fully reopen—Little Dom’s patio and dining room have reopened with limited capacity, while MiniBar is still closed at press time—he expects to keep to-go, pre-batched cocktails on the menu.
Sangria has been a big seller to-go at Telefèric Barcelona, a Spanish-themed tapas venue with locations in Palo Alto and Walnut Creek, California. The restaurants have been selling three sangria varieties during lockdown—a signature red sangria made with Altos Ibéricos Crianza, as well as a Codorníu Cava-based sparkling version and a spicy white, comprising Torres Verdeo Verdejo white wine, Tito’s vodka infused in-house with peppers, Torres Magdala orange liqueur, St-Germain liqueur, and lime juice ($28 for 32-ounces, designed to be three drinks). These complement the restaurants’ takeout tapas and paellas and its newly created Spanish Market, which allows guests to buy premium imported products, from cured meats and paella ingredients to Spanish wines and beers. Telefèric Barcelona had to lay off roughly half its staff due to the pandemic closures, though both venues are now open for outdoor dining.
“Restaurants have always been places to gather with family and friends, but as the world evolves, we need to adapt and build new business paths so we can provide our services to more people,” says Telefèric Barcelona Group owner and founder Xavi Padrosa. “I hope that by mid-summer restaurants will be operating. It’ll be wonderful to see people enjoying themselves in bars again.”
Many companies that have had to lay off employees have started fundraising efforts to support their displaced staff and local communities. Boston-based Big Night Entertainment Group, which operates 18 nightclubs and restaurants in Massachusetts and Connecticut, went from having roughly 1,500 employees to just 33 during lockdown. The company created its B Strong Fund to help, and raised more than $330,000 in two months, largely through virtual fundraisers such as online auctions. Money from the fund has gone to support Big Night employees, buy crucial supplies for people in need in its venues’ communities, and serve free community meals.
While many of Big Night’s club spaces remain closed, a handful of its restaurants are beginning to open with limited capacity seating, in addition to offering takeout and delivery. Tequila Cocina sold tacos and fajitas ($6-$22) to-go during the pandemic, as well as beer ($10 a 6-pack), wine ($25-$30 a 750-ml.), and cocktail kits that include everything but the alcohol for sangrias and Margaritas ($12-$25). “The cocktail kits have been an exciting and interactive way for guests to enjoy our signature cocktails at home,” says Big Night principal Ed Kane. “We package up the drink mixes and include drinks vessels. We’re featuring easy-to-order, standout cocktail mixes, beers, wines, and sakes that we think will resonate with people at home.”
As Big Night looks toward reopening, Kane says the company will take a staggered approach and focus on safety protocols like social distancing, sanitization, and personal protective equipment (PPE). On-premise operators of all sizes are working on similar measures. Darden Restaurants, which manages eight concepts and more than 1,800 units nationwide, began opening restaurants with limited capacity in some states in late April. The venues have fully revised operating procedures, from daily temperature checks and masks for all staff to reconfigured restaurant interiors that allow for 6-foot spacing between tables and contactless payment options. As of the end of May, Darden was operating about 65% of its dining rooms nationwide, and executives estimated that company-wide sales had dropped by roughly 45% this spring.
Baltimore-based Atlas Restaurant Group, an operator of 15 properties in Maryland, Texas, and Florida, has also seen revenue decline by about 50% during the Covid-19 pandemic. After initially shuttering all of its venues, the company started reopening dining rooms and terraces in May, first in Florida and Texas and then in Baltimore, offering outdoor seating only. In all, Atlas furloughed 1,000 employees. Its venues, which include Ouzo Bay, Azumi, The Elk Room, and Loch Bar in greater Baltimore, offered food and beverage takeout during lockdown, as it slowly looked to rebuild sales. The company has instituted a ten-point safety and hygiene regimen that includes employee wellness checks, required guest reservations, limited guest party sizes, table spacing, and sanitation stations.
“We feel it’s important to try to give guests the same experience they had prior to the pandemic,” says Atlas founder and president Alex Smith. “I think 2020 is a giant loss for all food and beverage outlets, and a return to normalization will take time. Our guests need to feel comfortable enough to come out and dine. We’re going above and beyond what states are mandating for businesses to reopen, allowing guests and employees to be safe while we generate revenue.”