Since COVID-19 forced businesses in downtown Madison to shutter their windows and doors, operations have been in a constant state of flux. Various lockdown orders and sustained financial stress have made it nearly impossible for many local business owners to stay afloat.
During the first six months of the pandemic, the number of vacant storefronts in the city’s Business Improvement District (BID), which typically consists of 390 businesses, increased from 32 to 51, according to an Operations report provided by the BID.The report also indicates that an additional 15 businesses were listed as “temporarily shut” due to COVID-19 related concerns.
In 2021, 48 businesses remain vacant in the business district, while seventeen are temporarily shuttered as a result of COVID concerns.
Tiffany Kenney, the executive director of the BID, explained that in the past year, businesses have relied on high levels of community support to remain open during the pandemic. The holiday season, when local residents frequented businesses at an increased rate, also boosted their prospects.
“Instead of sales being down something like, 50 to 60% down around Christmas and New Years, we really saw them more like 40 to 50%,” Kennedy told the Cardinal.
Despite the support, store owners have faced severe economic consequences as a result of COVID-19. Gil Altschul, who owns eight restaurants located in Madison, reported an 80 to 90% reduction in profits at two of his businesses which he chose to keep open, while being forced to close the remaining six for financial reasons.
“I wanted to keep a few key people employed, as many as I could,” Altschul said, describing the difficulties of the past winter. “But even with work, a lot of orders are just carry-out. It can be really hard to keep morale up, never seeing customers.”
Plaza Bar and Grill, another downtown business, was on the cusp of filing for bankruptcy, only to be rescued by an online fundraising campaign that netted $83,143.
“Before the pandemic hit, our profits came 70 percent from the bar, but when we switched to carry out, something like 90 percent of our profit was from food, but we weren’t making enough to stay open,” said Ian Miller, a manager at Plaza Tavern. “For takeout, because we’re not used to doing this, costs came in at around 30 percent of each order’s price.”
Nick Koshollek, the owner and proprietor of Rocket Repairs has also struggled to transition to a distanced business model reported a nearly 90% decrease in business during the past year. Apart from the financial loss, Kosholleck also told the Cardinal that he misses the ability to connect with local customers.
“I’m a socially active person, and that’s a big reason why I started this business,” Koshollek stated. “So with fewer people coming, and them all wearing masks, it's much harder to remember whose who. I really miss getting to know my customers.”
What’s Next For Downtown
Over 20% of Dane County residents have received the COVID-19 vaccine and as that number continues to rise, business owners and the City of Madison anticipate an increase in patronage in the near future.
“In the last four to six weeks, as we’ve seen vaccine numbers rise, that’s when our outlook really began to change,” said Kenney. “The fact that hospitality and restaurant employees got moved into like the second quarter is so important for opening up again.”
One of Kenney's main jobs as executive director is to act as a liaison between city government and business owners on State Street. In her role as executive director, she feels responsible for keeping member businesses in the BID informed on how to operate during the pandemic.
Kenney explained that she anticipates that Madison’s local economy will begin to recover from the economic impact of COVID-19 during late 2021 and that recent city ordinances expanding opportunities for local businesses such as outdoor seating will prove instrumental in the coming months.
“I know already that for 2021, we're able to continue the streatery program that's expanded outdoor eateries. And I think the community has responded overwhelmingly to those,” said Kenney, confirming that outdoor dining space which had not been used by restaurants in the past will remain this summer.
Kenney also shared that, this summer, the BID will initiate a pilot project closing the 400 block of state street to non-pedestrian traffic to allow local businesses to expand onto the sidewalk.
“Hopefully around May through September, we will offer the restaurants larger cafe spaces outside to have retail stores put up some of their merchandise outside,” she said.
Kenney expressed her hope that if the project succeeds, the greater Madison community would consider implementing similar programs in other locations within the downtown area.
“It's an experiment at the same time to understand what closing 400 State or closing any part of State Street would mean,” Kenny stated. “Once we do the experiment on 400, we might understand better what it could do to the rest of the street, and that means taking buses off, moving them, seeing how people feel about that and really having some good conversations with the community.”
Kenney also expressed excitement about a pop-up project with the local Black and Latino Chambers of Commerce, where local entrepreneurs in the Black and Latino community will have the opportunity to temporarily operate their business on state street.
She hopes that following the pop-up event, an entrepreneur of color will consider establishing a permanent business on state street.
“I think it's about 31 vacant spots on State Street. So wouldn't it be cool if you come in and you do a pop up,” Kenney said. “The community is always saying to us that we want to see more diversity downtown and we hope this can be a meaningful first step.”
Kenny also stated that the BID is currently planning to host the Madison Night Market, where local restaurants will set up vending stands on Gilman and State streets starting in the fall and also begin hosting socially distanced concerts on the square — in socially distanced fashion — to begin as soon as May.
Businesses Return
Plaza, Altschul’s businesses, and Rocket Repairs are also looking ahead and beginning to reopen.
Altschul, who plans on re-opening his businesses to 25-50% capacity, expressed a guarded sense of optimism for the coming months, stating that the challenges have caused his business to adapt in ways that he hopes will be beneficial in the future.
“It's just a continuation of what we were building on as we adjusted and pivoted last year,” Altschul said. “Now we're better at reduced capacity and outdoor dining, we're more used to it.”
Although the transition to primarily serving as a restaurant has been difficult, Miller expressed gratitude that he and his coworkers will be able to return to work.
“Sitting at home for months doing nothing is depressing,” Miller explained. “Everyone's gone through that and just having to have a goal that you can reach and go to work and have something to do again is great.”
Koshollek is also enthusiastic about the future, hoping to see a return to normalcy for his business and his customers.
“I'm just looking forward to going back and building the business, building the brand and just being able to see the customers after a long, long break.”