Ingenuity, determination, flexibility, imagination and maybe a dash of patience.
Those are the qualities that Alexandrians — from business owners to residents — are going to need in the coming months as they transition from stability to recovery from the local effects of the global pandemic.
This summer will be a critical period for Alexandria’s economy. If Alexandria residents and businesses can get through this initial difficult period, the long-term economic fallout may not be as bad as some initially feared.
“If all of us approach this recovery with flexibility in mind, that’s going to be the path forward for the area,” said Alexandria Economic Development Partnership (AEDP) CEO Stephanie Landrum.
Alexandrians also need to balance optimism with being realistic, she said. “It’s going to take time to fully recover and I think we should be realistic about what the recovery looks like.”
The economic pain experienced by businesses forced to suspend operations or make big changes was sharp and swift. Companies that reported some of their best months ever in January and February reported their worst months ever in April and May.
While a handful of businesses have closed and will not return, most plan to reopen, according to Alexandria Chamber of Commerce (The Chamber ALX) CEO Joe Haggerty.
“People know it’s going to be difficult, but they are going to try to reopen,” Haggerty said. “They’re all willing to fight. We know not every one of them will make it, but we hope as many as possible make it, and we’ll all work together to help them.”
One of the most visible signs will be new stickers on businesses’ doors and websites indicating that business owners have taken a pledge to prioritize com-bating coronavirus by following certain safety and cleaning procedures for both employees and customers.
The program, an initiative of the Alexandria Health Department with support from Visit Alexandria, is called ALX Promise.
“We know from research that if businesses such as hotels, attractions and restaurants, follow health and safety protocols, consumers are more likely to be interested in visiting,” said Patricia Washington, CEO of Visit Alexandria. “Fifty percent of consumers said they’d be more interested in visiting if they could see that hospitality businesses are following health and safety measures.”
Alexandria's local recovery will take a lot of effort in areas that may not be as visible, too, from changes to business models to technology upgrades.
The Chamber ALX, along with Visit Alexandria, the Alexandria Small Business Development Center (SBDC), the Alexandria Economic Development Partnership (AEDP) and other groups and associations, are all facilitating conversations among business owners to share best practices for welcoming consumers back.
Already, the way businesses have quickly adjusted their operations and executed new ideas is a positive sign for the region’s recovery, said Megan Podolsky, president of the Old Town Boutique District.
“I was really impressed with the way people instantly became innovative and shifted their business,” said Podolsky, who owns 529 Kids Consign and co-owns Mint Condition. “We have such amazing business owners — and they were just able to shift gears.” Most of the OTBD members — 30 small businesses in and around Old Town — immediately started curbside pickup or delivery services and used Instagram and Facebook to help their customers shop.
“I’m hoping that the summer will give us an opportunity for businesses to figure out what they’re doing that isn’t working and they’ll be able to make those adjustments,” said Bill Reagan, executive director of the Alexandria Small Business Development Center.
Safety First
While some businesses have started reopening and more will do so this summer, health officials locally and nationally are concerned that COVID-19 cases could increase again. While almost everybody hopes there is no resurgence locally, concerns about one could be a major factor in the Alexandria area’s economic recovery — and it could hold some residents back from visiting the businesses that have reopened.
“You can declare everything reopened, but if the people don’t show up, then it’s not reopened,” Mayor Justin Wilson told Alexandria Living. “If people don’t feel safe, then they’re not going to go back to spending money, and they’re not going to go back to those businesses. That is one of the trickier parts of this. The platform upon which any recovery is built has to be restoring public health and confidence in public health.”
To make people feel safe, local officials will be making significant investments in testing. Alexandria’s estimated $20 million to $27 million from the federal Coronavirus Aid, Relief and Economic Security (CARES) Act, which set aside money for state and local governments, will help with that.
In addition to funding going toward increased testing capacity, officials have hired more contact tracers to inform residents quickly when they have been exposed. In addition, some funding will go toward stability for residents through programs like emergency rent assistance, food distribution and childcare for essential workers.
Fairfax County will receive more than $500 million, and has similar plans for that funding.
Fortunately, Alexandria has some natural advantages: Alexandria is known as a place that has great outdoor spaces, plenty of parks and walkable neighbor-hoods, Washington said. “I think people are looking for that – places with a little more room to explore beautiful out-door parks and architecture, as well as heading into shops and getting take-out meals. … I think Alexandria will resonate with consumers.”
Assistance for Businesses
Both Fairfax County and the City of Alexandria are stepping up for local businesses with millions of dollars in grants to help them reopen and return to being profitable.
Fairfax County established a grant program for small businesses in May. Funded with $25 million in CARES Act funds from the federal government, the grant program called Fairfax RISE is de-signed to provide immediate assistance to small businesses and nonprofit organizations. At least 30 percent of the pro-gram’s total funding will go to minority, veteran and women-owned businesses.
“Our hope is that these grants will help small businesses and nonprofits emerge from these difficult times, retain employees and be prepared to grow in the future,” said Fairfax County Chairman Jeff McKay.
In addition, Fairfax County started business support initiatives such as the Small Business COVID Recovery Microloan program and a $25 million Safety Net Non-Profit Grant Program.
The City of Alexandria has also launched a large grant fund to help business-es re-establish operations. Through AEDP, the City is using funding from the CARES act and other funds to help businesses come back stronger through the new Alexandria B2B (Back to Business) program.
“We are trying to aim it at, ‘How do we help businesses recover, how do we help them transition and evolve their businesses for a very new environment?’ so that we aren’t just helping people pay bills — which is important — but we’re actually helping them come back,” Wilson said.
Unfortunately, in both Alexandria and in Fairfax County, there may be a lot of businesses that are not going to come back for a variety of reasons — some were on shaky financial footing before the coronavirus crisis, and some have owners approaching retirement age who aren’t interested in rebuilding their business.
“To the extent that we have businesses out there that have taken a body blow because of this but very much want to get back out there, we want to help them. That’s going to require all sorts of new investments for these businesses, and we want to help them do that,” Wilson said. “That’s what we’re focusing that money on.”
For business owners, coming back won’t be as easy as walking into the store and flipping the light switch back on, Reagan cautioned.
“Business owners will need to rethink how people will use their physical space, and all of them are gearing up to do more online,” he said. “That’s going to be one of the keys.”
To help, Reagan worked with other small business leaders to develop the Virginia SBDC’s Recovery Resource Center (virginiasbdc.org/recoveryresourcecenter). The Recovery Resource Center provides a variety of how-to guides and best practices on how to reopen safely, from clean-ing to supply chains, staffing and customer service.
For businesses that did not have robust online sales systems already, changing or upgrading their point of sale and inventory systems may take a significant investment of both time and money, Reagan said.
The Alexandria SBDC has also spent countless hours trying to help business owners navigate the Paycheck Protection Program, which was designed to provide forgivable loans to small businesses, but ran into a laundry list of problems. Now, the SBDC is trying to provide guidance on how to properly spend and track the funds for the businesses that got through the application process.
Reagan said he’s had years of experience helping small businesses navigate U.S. Small Business Administration programs with few problems. “This has been an entirely different experience,” he said.
Alexandria’s Chamber of Commerce (The Chamber ALX) in March decided to focus on providing actionable information to local businesses about loans and grants, sharing best practices and more. The organization launched a series of webinars designed to help businesses navigate through this difficult period in addition to web-based resources and virtual meet-ups.
While many people think of restaurants, hotels, entertainment venues and personal care businesses being hit hardest from the pandemic, many of The Chamber ALX members are in other industries that need support, too — many of whom could continue business operations with some adjustments, such as letting staff continue to work from home for the foreseeable future.
In the midst of it all, The Chamber ALX was re-evaluating its own major events, which often focus on bringing people together. “It would be great to get back to bigger meetings and people having a great time, where people can talk and communicate and share a drink and meet somebody new,” Haggerty said, but there’s a very real possibility that 2020’s events will be smaller, virtual or both.
Lessons from Sept. 11 and Amazon's HQ2
Businesses may need to make changes in the future that may not even be on their radar right now, Haggerty said, referring back to significant changes in the way businesses operate that happened after the Sept. 11, 2001 terrorist attacks.
“We will have different behaviors, and businesses will have different behaviors. Some of those changes will stay with us and some will go away, but look at how different things are now,” Haggerty said.
In addition to the way small businesses have pivoted, there’s another positive sign: Major projects are continuing, including the new Potomac Yard Metro station construction and large building projects. New restaurants have plans to open. “Hopefully we get back to some economic growth for everybody,” Haggerty said.
Mayor Wilson noted that this region capitalized on the investments that occurred in this area after those terrorist attacks.
“We did a good job of making sure that we were the area for counterterrorism investments and cybersecurity,” Wilson said. “We have to do the same thing with this crisis. To the extent that there’s going to be big money thrown at public health, pandemic resiliency and public health, we have to be ready to capitalize on that.”
“From an economic development perspective, we have some opportunities as a city and as a region and I’m hopeful,” Wilson said. “Some of the work we’ve done in the past couple of years to be more regionally focused about economic development will help us capitalize on that.”
In September 2019, the AEDP worked with other Northern Virginia economic groups to form the Northern Virginia Economic Development Alliance. The new organization will work together to promote Northern Virginia as a business and economic development destination. It was formed after Northern Virginia localities banded together to market the region as the perfect choice for Amazon’s second headquarters, which is now under construction.
Attracting HQ2 required a lot of collaboration between Arlington, Alexandria and even Prince William County. “We learned out of Amazon that it doesn’t have to be every man and woman for themselves and that the sum of our parts is worth more than individual jurisdictions. If we go together and sell the region, and the assets of the region, we can be really successful,” Wilson said.
Alexandria is stronger when it works with its partners across Northern Virginia, Landrum noted. “We can’t just make decisions here in Alexandria about, say, contact tracing and testing and distancing, without recognizing that we’re part of a much larger metropolitan area. When we’re at our best economically, it means lots of movement between Alexandria and everywhere around us.” If the region works on stabilizing and recovering from this global pandemic at the same pace, “I think that will help deliver the best outcome for all of us.”
Looking Ahead
As of now, there’s enough capacity at Alexandria hospitals to handle the cur-rent load of coronavirus patients.
“Assuming we can stay there, you want to see some of the commerce that’s occurring in Alexandria get back to normal, or normalish. We’ll still see a lot of restrictions on congregations of people,” Wilson predicted.
One thing Landrum wants to hang onto even after the pandemic passes is the appreciation most residents have felt for not only front-line workers, but for grocery store workers, delivery drivers, restaurant employees and everyone else who helped keep residents going through the spring.
Even as restrictions relax, until there’s a vaccine or enough testing to be able to identify and isolate infected residents, there will still be hurdles to a full economic recovery, Wilson said. There may be restrictions and physical distancing requirements in public places for a long time to come.
That may mean more innovation com-ing from local business owners in the coming months.
This summer, Visit Alexandria is rolling out a flexible getaway hotel package. Usable through the end of 2020 with generous cancelation terms, the package is designed for regional travelers who want to start taking vacations again. Visit Alexandria’s summer and fall marketing campaigns will focus on things that can only be experienced in Alexandria, Washington said. In addition, the ALX at Home online resource will remain accessible for residents and visitors to explore safe dining, retail and other experiences.
“Ideally what I would love to see is a flourishing holiday season, but we need to be smart and anticipate the worst and plan for it — and hope it doesn’t happen,” Podolsky said. “Businesses will need to work together and continue do-ing innovative shopping and selling.”
The SBDC’s Reagan said so far, he’s been impressed with many local, small retailer owners.
“They are savvy, they are figuring this out, they’ve had some pretty good online sales when that was never a big part of the way they did business, and they’re adjusting to it. The savvier our business owners are, and the more they can roll with the punches, the more it will lead to a successful fall and holiday season.”
Landrum said she hopes that by the time the holidays roll around, most residents and businesses are on a more stable economic footing — at least enough so that Alexandrians can enjoy the holidays this year.
“I think if we can do that, it’ll be successful. It doesn’t mean that we will have fully recovered, but if we all feel healthy and safe and we’re on a path toward economic recovery,” she said, “I think that would be an amazing goal to strive for. I’m hopeful that’s the situation. After all the work we’re all doing, it certainly will be deserved.”
