EVERETT — Tough times are nothing new for Grace Correa of Everett.
Amid a divorce in 2017, she lost her restaurant, slept in her car for three months, and fell victim to a hit-and-run. She took $25,000 from the insurance settlement and invested it in a new restaurant.
Gracie’s Cuisine opened in December on Everett Mall Way, offering a blend of Filipino and American dishes: sizzling platters of bistek tagalog, adobo burgers and rice cakes.
At the start of the year, sales were steady, about $1,000 per day. But business came to a screeching halt in March, when a statewide ban on sit-down dining pressured many restaurants to close temporarily or permanently. The noose tightened further March 23, following an order by Gov. Jay Inslee telling people to stay home as much as possible, with exceptions for essentials and takeout.
Correa, 47, has averaged as little as $80 a day in sales lately.
“I have to make at least $500 a day to break even,” Correa said. “I’m hanging on by a thread. Hopefully, my landlord won’t evict me. If he (does), I don’t know what I will do. All of this effort, all that I did, it would be gone.”
At the time the virus landed in the United States, Snohomish County’s restaurant industry was riding a decade-long wave of growth, Department of Revenue data shows. Between 2009 and 2019, gross sales across the county more than doubled to $953 million. The number of restaurants increased from 827 to 1,457. And according to the Washington Hospitality Association, in roughly the same time span, the year-to-year failure rate decreased from 21% to 16%.
Now the boom time is over.
Restaurant owners are stuck in limbo. Some are finding ways to rebound, slowly, but even longtime industry veterans don’t know what the landscape will look like when the virus subsides.
Grace Correa (center) owner-operator, totals a check for Merlyn Gustafson (left) and Jojie Villaroya at Gracie’s Cuisine Saturday afternoon in Everett on March 14. Two days later, sit-down dining was banned in restaurants across the state. (Kevin Clark / The Herald)
The sudden drop
Gracie’s Cuisine is still open, but for how long remains to be seen.
“I’ve been in the industry professionally for 30 years,” said Anthony Anton, president and CEO of the Washington Hospitality Association. “There is nothing that remotely touches what’s going on. There’s no comparison of a negative impact.”
Andrew Pham knew he was taking a risk when he opened Basil Authentic Vietnamese Cuisine on Everett Mall Way, in the same neighborhood as eight other pho restaurants.
“There are so many competitors on this road, let alone a 5-mile radius,” he said. “But our head chef at the time was extremely confident in what we had and what we were capable of making. He said, ‘If there’s a customer base willing to eat pho and Vietnamese food, then we have a good shot.’”
Pham had never run a restaurant before.
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He had to learn to manage communication between the front and back of house.
Negative reviews on Yelp kept him awake at night.
Then in its third month, things started to click. Customers raved about not just the pho, but vermicelli bowls, fresh spring rolls and banh mi. Basil had flourished for two years, when Inslee banned sit-down dining on March 16.
Sales dropped 75% in a single day.
Pham, 32, of Lynnwood, noticed other pho restaurants along Everett Mall Way closed their doors.
“If we were a burger joint or more hands-on takeout food, we wouldn’t have been impacted so hard,” he said. “But we’re a soup-based restaurant. I understand why you wouldn’t want the hassle of driving pho home or reheating the broth.”
Basil’s partnerships with delivery services GrubHub, Uber Eats and DoorDash helped stave off some of the damage. All full-time staff kept their jobs, but worked reduced hours, divvying up times to clock in throughout the week.
In restaurants big and small, layoffs and furloughs are rampant across the county. Hidden Vine Bistro in Marysville furloughed most of its staff March 16, then announced a temporary closure a week later. So far the disruption has been a manageable problem for some, like the executive chef, Julia Apana-Butler. Other service workers in Washington aren’t so lucky.
“Fortunately, I’m in a place where my husband has a job,” she said. “I’m not as adversely affected as someone who provides for their family.”
After looking around the main dinging room, Diane Symms, owner and CEO of Lombardi’s Italian Restaurants, inspects the kitchen at the Everett location on Feb. 21. (Andy Bronson / The Herald)
The worst crisis
Many restaurant owners are resigned to the idea that things will get worse before they get better.
Before it became official, Diane Symms, owner and CEO of Lombardi’s Italian Restaurant and Wine Bar, was already preparing for the ban to extend well into April. It’s the worst crisis she has faced in 45 years as a restaurant owner — and she was around for the 2008 recession and a disastrous 2009 flood in Mill Creek. In March, she furloughed nearly all of the employees in Everett, Mill Creek and Bellingham.
“We really don’t know what the impact is going to be,” she said.
Negotiations with landlords, as well as state or federal relief, could determine how many restaurants survive the crisis, said Anton, of the hospitality association.
Eateries already geared toward takeout will have a better chance of making it. Sit-down restaurants will see big losses. Some owners may decide they can’t go deeper into debt.
“Restaurants live on a 4% margin when times are great — times are not great,” Anton said. “These next two years are going to be hard.”
Kathy Curnutt can’t look that far ahead. She’s living week by week as the owner of Prospectors Steak & Ale in Gold Bar. For 21 years, her restaurant was a go-to destination for steaks, burgers and bingo. Now everything must be to-go.
But like most steakhouses, Prospectors wasn’t built for takeout. About 50% of the revenue comes from the bar, which must stay closed as long as the governor’s order is in effect.
“Just like everybody else, we’re going to give it a couple of weeks,” Curnutt said. “It’s tough because I have part-time employees and they don’t make enough to get unemployment. They plan on coming in to help out and get tips.”
Curnutt, a longtime Gold Bar resident who now lives in Index, bought the building at 201 Croft Ave. to open Prospectors in 1999. Horseshoes, pool and karaoke made it a popular hangout. Curnutt opened two more restaurants in Sedro-Woolley and Index but closed them during the recession in 2008. To keep Prospectors going, she sold her building and rented the space from the new landlord.
Curnutt got support from locals early on, she said. But when The Daily Herald contacted her later in March, she had made $0 in sales for the day.
“We do appreciate everybody helping us so far, but today scares me,” she said. “It’s pretty much my daughter and me who hold down most of the hours. I have one other who helps with cooking. How can I pay somebody nine hours when we haven’t had one person? What do you do? Plus, I’m looking at rent and I haven’t gotten anything stashed for it.”
Many other restaurant owners share Curnutt’s worries, Anton said, and there are too many unknowns to predict the future of the industry. Ramifications will vary from city to city. Anton expects neighborhood restaurants and those located near economic giants, such as Boeing, to be the first to surge back.
Looking further into the future, Anton said he’s encouraged by consumer trends among millennials, as they grow into their 30s and 40s, an age range that is, in theory, more financially stable. People born between 1981 and 1996, he said, tend to be more likely to dine out than cook at home.
“Millennials are the first generation to value their time more smartly than any other generation before them,” he said. “They’re more likely to stick with the industry as the industry finds its way.”
Not all restaurants will live to see that day.
“There are going to be small, medium and maybe even big restaurants that don’t survive this,” Anton said. “I don’t think that’s a secret. We’ve got to figure out where to go from here.”
Evan Thompson: 425-339-3427, ethompson@heraldnet.com. Twitter: @ByEvanThompson.
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