“A popular phrase, while perhaps over-used by economic developers, has never been truer than today: A rising tide lifts all boats,” says Amanda Shailendra, a partner in the Pendleton Consulting Group.
“We know we are in this together and we are reminded daily just how we rely upon one another. In this new normal, we need to identify what we can do to support local businesses, small to large, bottom to top, open or closed – or in limbo. And as we work to bring the tide back up, we should all remember there are ways we can already support one another.”
Shailendra notes the federal stimulus package, which recently passed in Washington, will provide checks directly to Americans, expand unemployment insurance, offer unprecedented amounts of loans to both small and large businesses, and provide increased resources to healthcare and other essential industries.
In addition to the economic stimulus at the national level, states and local governments have several ways to immediately help their economies and plan in the near-term for our evolving “new normal.”
An example: The restaurant industry has been devastated during the crisis. City and county leaders may choose to provide fee waivers and grants to assist with utility bills for closed restaurants as they re-open.
They might also choose to update local laws regarding food and alcohol delivery restrictions, identify locations that could serve as community kitchens while putting people back to work, and consider creating open container zones in town center areas to allow patrons to convene outside the home – while also social distancing and temporarily eliminating restrictions on happy hour specials.
Real estate owners and operators are already providing tenants with immediate ways to make the near-term work for both entities. Rent deferrals and waivers are already rolling out to tenants. Owners are encouraging their retail tenants to use rent funds to pay employees rather than the landowner – or to use tenant improvement allocations for salaries instead, deferring those renovations and improvements until a later time.
One restaurant owner in Charleston, S.C. was told to use March sales to pay all remaining employees rather than pay April and May rent, thus investing funds for immediate needs in the restaurant and the community.
Other commercial owners have proactively told tenants to withhold rent payments until their business is able to make an income, but also asking in return for the company to commit to a longer lease once the current health and economic crisis stabilizes.
She recommends that as we are waiting for a better understanding of the economic future of our communities, we should consider a few of these recommendations to prepare for what is ahead:
· There’s no need to re-write your community’s economic and community development strategic plan today, but consider re-evaluating your community’s plan, especially its target industries.
· Consider adding updated retail opportunities, such as mobile retail, experiential retail or dynamic retailers (such as pop-up shops or locations that provide a variety of different merchandise for limited periods of time).
· E-commerce, short-term storage, and industrial flex space are also areas to consider adding to target lists if not already identified in your community.
· Continue collecting labor statistics, mobility trends, and demographic data to prepare for the re-opening and re-investment in those industries hit hardest.
· Disruptions to both supplier networks and logistics chains will continue over the next few weeks and months. Whether they are consumer access to toilet paper and hand sanitizer, or manufacturers’ access to component parts, these challenges will require adaptations for the foreseeable future.
· Thus, economic development organizations can assist with this challenge by connecting local companies with potential new suppliers and logistics networks. Communities that identify a path for existing industries to repurpose, reuse, and reconnect will speed up recovery of their local economy.
· Those with closed offices and over-stretched staff should begin using third-party firms to assist with permitting applications and inspections in order to help keep projects moving. This type of public-private work will not just speed up the process for new investment opportunities but will also help provide an additional work source to private sector firms, which have experienced a major decrease in client activity.
· It’s also important to understand the latest developments in small business programs and identify a local point of contact to assist companies in gaining an understanding of the benefits, as well as paperwork needed to apply and comply.
· Finally, it’s important to maintain communications with local businesses, elected leaders, colleagues from other communities, and individuals in personal networks. This includes sharing current struggles and successes, and keeping an open mind focus on that higher tide that is going to lift all of us back up.
“There are no winners or losers right now,” she concludes. “Whether you work for Wall Street or Main Street, big business or small, public or private, our focus should be on a successful recovery. Recovery may mean deferring rent, showing patience with ownership, temporarily closing, or finding new short-term financial opportunities. Most importantly, a successful recovery will be dependent upon creative ideas, new perspectives and flexible solutions.”
About Amanda Shailendra
Amanda Shailendra is an economic development and site selection specialist whose experience includes working for the State of Georgia’s Department of Economic Development, Google Fiber, Inc. and the City of Atlanta’s Development Authority. As a Partner of the Pendleton Consulting Group, Shailendra advises corporations and public entities.