The COVID-19 pandemic has impacted virtually every industry in the United States. However, each industry is being impacted in its own unique way. In this blog series, we have been taking a closer look at specific property types and discussing how they’ve changed since the start of the global pandemic. So far, we’ve covered Hotels and Offices, so make sure you check those out if you missed them! This time, we move on to the impact of the pandemic on the future of restaurants.
Restaurants and COVID-19
To get straight to the point, the pandemic has hit the restaurant industry quite hard. The initial March shutdown caused restaurants to close their doors and solely rely on takeout orders for income. In the months that passed since then, restaurants have been able to provide indoor and outdoor seating at reduced capacity. Unfortunately, it’s already too late for many of them. According to the National Restaurant Association, 1 in 6 restaurants have closed their doors permanently or long term due to their inability to pay rent and still profit.
Forecasting the Future for Restaurants
It’s hard to predict the long-term future of restaurants, because the situation is everchanging. However, from the start of the shutdown in March to July, the foodservice industry lost $165 billion. The industry is on track to lose a total of $240 billion by the end of the year.
We also need to remember that many businesses are still heavily relying on outdoor seating due to reduced capacity. This will likely lead to even more complications as we begin to move into the colder months of the year. In fact, 40% of restaurant operators think it’s unlikely they will be able to stay in business for the next six months unless further government relief is provided. These stats paint a pretty clear picture of the unfortunate state of the industry. As we continue our road to recovery, let’s hope that the tide changes and creative restaurant owners manage to navigate through these uncertain times. Until then, it is probably best to avoid investing in this industry.
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