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Coronavirus in Oklahoma: With retail on the ropes, brokers are the tie that binds landlords and tenants in Oklahoma City

A Fuzzy's Taco Shop location during better times for retail. [NAI SULLIVAN GROUP]
A Fuzzy's Taco Shop location during better times for retail. [NAI SULLIVAN GROUP]

What is a shopper to do when stuck at home during the coronavirus crisis? I have to ask, not really being a shopper.

More important is what are stores to do? Store managers? Owners? Landlords? The commercial property brokers who bring them together?

People who work in stores? People who can't now because the pandemic is killing businesses?

Here's a glimpse of retail in Oklahoma City and what some brokers are doing to try to save businesses and jobs. It's from David Hartnack, a director and vice president of retail for commercial realty brokerage NAI Sullivan Group. He sent it over Friday and it all deserves to be seen. Hartnack writes:

The spread of the novel coronavirus throughout the world has dramatically changed life, and has had greatly varied effects on the retail industry.

The losers

Mandatory closures from "shelter in place" orders have had a devastating effect on retail service providers like salons, fitness facilities, entertainment centers. Traditional brick-and-mortar retailers, while not uniformly forced to shut down, are also struggling with sales as customers avoid gatherings. Operators of these businesses are forced to struggle with furloughing employees, renegotiating leases and mortgages, and maintaining facilities that are now unable to generate income.

NAI Sullivan Group has been working with landlords on accommodating these struggling tenants by restructuring rent payments, granting free rent in exchange for additional lease terms, and accommodating a change in business to allow tenants to continue to generate income. However, the market remains concerned about whether solutions like these will be effective if these closures continue for months.

The winners

Not all businesses have been as devastated by the virus’ effects as these service providers. Many grocery operators are reporting record sales as customers fill their pantries in preparation for spending time at home. Additionally, food delivery services are seeing a huge surge in demand as customers seek alternatives to the traditional dine-in experience.

The middle

The effect on quick-serve restaurants, online retailers, and hardware retailers has been much more mixed. The comparative low interaction of a drive-thru window seems to still appeal to virus-wary diners. And the boredom of self-isolation has many consumers shopping online, or working on projects around the house that require trips to Ace Hardware or Lowe’s Home Improvement.

However these retailers are faced with the tough choice of staying open to generate what sales they can, or to close for the safety of their employees and customers.

Without a doubt, the hardest-hit group has been the retail worker. Kelly Allen, an owner and operator of Fuzzy’s Taco Shop and Alfredo’s Mexico Café, has been forced to furlough about 50% of employees as their sales have dropped 75% since switching to take-out only. Many entry level workers are now faced with layoffs, or reduced hours, and government relief has been slow in coming.

The virus’s effect on the jobs market, consumer spending, and retail activity has been catastrophic, and we are left wondering what will a recovery will look like.

— David Hartnack, NAI Sullivan Group

Be safe, y'all.

Email Real Estate Editor Richard Mize at rmize@oklahoman.com.

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<strong>David Hartnack</strong>

David Hartnack

<figure><img src="//cdn2.newsok.biz/cache/r960-55a3ac28c1bfc4a8e1677c9511362dd0.jpg" alt="Photo - David Hartnack " title=" David Hartnack "><figcaption> David Hartnack </figcaption></figure><figure><img src="//cdn2.newsok.biz/cache/r960-0d4d373a22bd84933b1b7d396079ac68.jpg" alt="Photo - A Fuzzy's Taco Shop location during better times for retail. [NAI SULLIVAN GROUP] " title=" A Fuzzy's Taco Shop location during better times for retail. [NAI SULLIVAN GROUP] "><figcaption> A Fuzzy's Taco Shop location during better times for retail. [NAI SULLIVAN GROUP] </figcaption></figure>
Richard Mize

Real estate editor Richard Mize has edited The Oklahoman's weekly residential real estate section and covered housing, commercial real estate, construction, development, finance and related business since 1999. From 1989 to 1999, he worked... Read more ›

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