When the COVID-19 Pandemic Is Over, What Will Bring WeHo Businesses Back to Life?

Businesses deemed non-essential by state and local authorities have been forced to close because of the COVID-19 pandemic. But once the pandemic is over, will those businesses be able to reopen?

That’s a question the West

Hollywood Chamber of Commerce is working with City Hall and state legislators to address.

The City of Los Angeles, Los Angeles County, and San Francisco already have put in place temporary moratoriums on eviction of local retailers and other businesses that can’t pay their rent because of the impact on their revenue of the COVID-19 pandemic shutdowns. (The L.A. City Council is expected to formalize the emergency declaration by Mayor Eric Garcetti today). City Councilmember John Duran has confirmed to WEHOville that there will be a similar measure on the Council’s agenda on April 6.

But while that will help local retailers, bars and restaurants, it might hurt landlords who have mortgages on the buildings occupied by those local businesses. How will they be able to make their loan payments?

Another issue local businesses are struggling with is the fact that insurers are refusing to cover the costs of the damages to their businesses because of the COVID-19 epidemic. That’s because many insurance policies include language that says insurers don’t have to cover losses because associated with viruses or pandemics. The New Jersey state legislature is contemplating a bill to override the virus/pandemic exemption, and that has been suggested to California legislators as well.

The Chamber of Commerce, which advocates for local businesses, also has expressed its concern that the recently passed federal relief bill doesn’t include help for organizations in its non-profit category, which is a 501 c6.

Brett Latteri, owner of the popular Den on Sunset tavern and chair of the Sunset Strip Business Improvement District, has felt the impact of insurers excluding coverage for virus or pandemic-related losses.

The Den on Sunset

“My claim was denied, and I know many others in and out of the hospitality industry whose claims have been denied,” he said in an interview with WEHOville. “You buy an insurance policy and make your payments. Then you need it and it’s not there for you,” he said.

Latteri hopes the West Hollywood City Council will impose a 60-day moratorium on evictions of businesses unable to pay their rent because of the impact of COVID-19. But he also is concerned that the eviction moratorium bills aren’t going to provide enough help if they give a business only six months to repay the rent they owe.

“You’re going to come out of this thing laden with debt,” Latteri said. “The last thing you want is to come out of this in debt when you’re in a walk-in business like mine.”

Brett Latteri

Latteri said some people assume that local business owners are wealthy. The people in our community need to know that the owners aren’t wealthy,” he said. “They are fighting for their lives, just like their employees are fighting for their lives.”

Latteri said he completely closed the Den after realizing that takeout and delivery orders, the only options available after the declaration of a restaurant and bar shutdown, weren’t generating enough income to pay the bills. “You’ve got growing competition,” Latteri said, and you’ve got the delivery business taking 30% off the top.”

Latteri also noted that commercial rents are high on Sunset Boulevard, the Boystown nightlife district on Santa Monica Boulevard and parts of Melrose Avenue.

Jay Luchs, perhaps the best-known commercial real estate broker in West Hollywood, has clients on both side of the eviction moratorium issue. About half of those he represents are building owners, and the other commercial tenants.

“I am a mediator. I am a mediator of people,” Luchs said. “It’s not that I’m choosing a side. I’m very pro-tenant, but as I’m listening to the landlords, I’m feeling their struggle.”

“As April comes near, the right thing to do is that a tenant, if they can’t afford rent due in April, should reach out to the landlord. Some landlords are saying I’ll give you April free, and some are saying they will work out a deal.

“If I had my way with the tenants, it would be straight up several months free,” Luchs said. But he acknowledged that landlords who own their buildings outright are in a better place to do that than are landlords who have mortgages to pay.

Jay Luchs

“If the landlords are saying I have a loan, and the tenants are saying I have to stay alive, what is the bank doing?” Luchs said.

Los Angeles Mayor Eric Garcetti also referenced that issue in a recent interview with Business Insider.

“Without concomitant measures to help landlords not default on their mortgages and for banks not to run out of money, we need — you know, this is a series of dominoes. To tell people that nobody has to pay rent, and then to tell landlords, ‘Don’t worry, you don’t have to pay your mortgage,’ and then to tell banks, ‘Don’t worry, you’re going to be supported,’ that’s a pretty big undertaking. And I don’t see that in the $2 trillion [federal] package that was just put forward.”

The City of West Hollywood has taken some steps to help local businesses. Councilmember Duran said Arevalo is working on a recovery plan for the city’s commercial districts. Meanwhile an emergency executive order issued by City Manager Paul Arevalo on Wednesday loosens some regulations. It states that:

  • Hotel restaurants may provide to-go meals to people who aren’t guests. Restaurants and retailers with an alcohol sales license now can sell and have delivered alcohol beverages by the bottle or can. And restaurants offering take-out or delivery can include beer, wine, and cocktails with the meals they sell.
  • Any restaurant, grocery store or food-related business now may operate from 6 a.m. to 2 a.m., as may those selling alcohol.
  • Parking requirements for restaurants are suspended to make it easier for customers to pick up to-go meals.
  • Zoning regulations that restricted conversion of a restaurant to a grocery store or market have been suspended so that they can sell food and other essential goods.
  • Medical cannabis dispensaries can remain open and provide curbside sales and delivery.
  • The business tax certificate fee that a brick-and-mortar store must pay to start selling products online is waived.
  • Business license tax payments to the city are deferred from May 1 to July 1.
  • The February and March hotel room tax payments by hotels to the city are deferred for 30 days.

Genevieve Morrill, CEO of the Chamber of Commerce, said the chamber is working with City Hall on various initiatives and has been lobbying the state legislature. It also has joined the Coalition to Save Small Businesses, a national organization that is pushing for greater protection for small businesses during the COVID-19 epidemic.

Jay Luchs said he hopes the City of West Hollywood comes up with plans that are really innovative. “They usually have made decisions that are way ahead of others. They are bold. They are strong compared to other cities, “ he said. “Maybe they can set a precedent there as other cities look to West Hollywood.

One city that has taken innovative steps is San Francisco, which has created a relief fund for small businesses and launched a campaign to solicit tax deductible contributions to help it provide shelter, food and other assistance to individuals, families, small businesses, and nonprofits in San Francisco.

The business eviction moratorium is certain to be on the City Council’s April 6 agenda, at which time Council members and city staff are likely to discuss other options. Once the epidemic is over, getting the city’s bars, restaurants and nightclubs back into business is especially important Duran said.

“WeHo is so small. We are all interconnected. When the clubs, bars and restaurants reopen, the city will come back to life.” The “most important part — psychologically and for community confidence — is having the restaurants and bars open will all the familiar faces in all the familiar places.”

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Steve Martin
Steve Martin
4 months ago

This may turn out to be an opportunity to look at our economic future more realistically. Two years ago the City sponsored a study on future hotel growth and the consultant’s report stated that we essentially had too many hotel rooms and that future growth would be counter productive. This went over like a lead balloon with the Chamber of Commerce. Early this year the City Council approved yet another study; clearly one that is going to be geared to repudiate the earlier report that developers did not like. The reality is that we need to figure out a plan… Read more »

Larry Block
Larry Block
4 months ago

A city built on socializing will now move into a new era of social distancing. The John Heilman and John Duran vision is dead. The community village is dead. Pay backs for donations to council members who voted to convert the whole city to liquor licenses reminds me that Jeanne Dobrin is looking down on us saying. ‘No’ to the next conversion of retail space to a bar. Duran’s still fighting the AIDS crisis – it’s a new day and time to #FlushTheJohns

Clean Up WEHO
Clean Up WEHO
4 months ago

First place, there’s not gonna be the expendable income. That’s the reality. Plus, people will have gotten use to be at home and the urge to go out will have declined. With hotels closing, like the Chateau Marmont, tourists will be slow to return. People will think before spending a dollar plus they may not have the dollar to spend. As for a big street fair in West Hollywood to celebrate the opening of restaurants, bars and clubs … that could have dire consequences if say five new virus cases were reported the following week. The entertainment industry has been… Read more »

Long Time Resident
Long Time Resident
4 months ago

Please stop publishing comments by John Duran. He never adds anything substantive to the conversation. It is always something about the bars (he must be getting kickbacks (j/k or am I?). There is more to our City than clubs and bars and restaurants.

O.M.G.
O.M.G.
4 months ago

John Duran’s latest post on Facebook is how to have sex during the epidemic. Detailing it with the “ins and outs” of surviving the urge without a Grindr hookup. The lurid post can give one the creeps reading it. Considering the source, it actually can serve as a move towards celibacy during the shut-in days or weeks to come.

Randy
Randy
4 months ago
Reply to  O.M.G.

Oh, for Chrissake. I read the post. He was acknowledging that some people are gonna have sex, no matter what they are told to do. He was also trying to help people understand what is safer and what is not. Even if you’re advised for total abstinence. Which he included in his post. Is there anything this man can say without it being torn to pieces by some comment on this website?

Eric Jon Schmidt
Eric Jon Schmidt
4 months ago

This is a great opportunity for young people to realize how much money they were spending in bars and restaurants. I hope they understand that the money they were spending on drinks and food could be saved, invested or used for something that improves their lives and protects their future. I’m not saying people shouldn’t go out and have fun with friends, but I hope that during this time when they aren’t spending money they realize how much they could save instead of spending when the businesses reopen.

hifi5000
hifi5000
4 months ago

To get business for the bars and restaurants going again in West Hollywood after the pandemic is over (I hope),there should be a big street fair to publicize the fact the entire city is open for visitors again.A big celebration on Santa Monica and Sunset Boulevards will do the trick and people will come flocking back to their favorite establishments. Be aware, some places will close permanently and that cannot be helped.I am sure there will be other operators anxious to take over those spots vacated by those old businesses.Some establishments will be missed,but the new ones can set the… Read more »

08mellie
08mellie
4 months ago
Reply to  hifi5000

BRAVO. THis city spends money on BS pet projects, (not) fixing the homeless issue, BIG money. AFter all of the crap these businesses went through with permits, etc., this is the least City Hall can do. THis event should be an entire WEEKEND. THere is no excuse to not do this. THank you hifi5000. I’LL gladly spend my money.

How do we get this started?????