CAPITAL REGION, N.Y. (NEWS10) — Many businesses are struggling to stay afloat during COVID-19, but it may just be the time to buy and sell. Rob McDermott says he’s been working in restaurants for 20 years, but never got to have one of his own. So when he saw on Facebook the pandemic had put AJ’s Pizzeria in West Sand Lake out of business, it felt like his moment.
“I saw hundreds of comments about how upset people were going to be if the place closed,” McDermott explains.
He says he knows how much it can impact a community to have a beloved staple, and he didn’t want to let that go.
“I come from, most recently, the Deli and Brew over in Troy by Hudson Valley they have a great customer base. Everybody loves them there, and this place felt very similar out in the Averill Park/West Sand Lake area. A lot of regulars, small town community. Everybody knows everybody and we help each other out as best as we can,” he says.
So he decided to take the plunge, relying on a close knit community, and AJ’s regulars. He says the pandemic hasn’t hit the restaurant as hard as people might think.
“It’s actually had the opposite effect on takeout and delivery, it’s increased [business] if anything,” McDermott says.
Local commercial real estate expert Jay Verro says that may come down to leasing, not owning the building and what you have to offer during a global health crisis.
“It comes back to the product type. I wouldn’t want to be the owner of a large restaurant, a large hotel right now because the folks are really suffering greatly,” Verro says in a Zoom call with NEWS10’s Mikhaela Singleton.
He says buyers of these types of businesses may find it harder to get bank loans right now.
“Banks are really going to be overly cautious and rightfully so. They are asking for a larger percentage down, so in essence more skin in the game from the tenant or the buyer. They may ask them to put up a home as collateral,” Verro explains.
Darla Cherry, owner of Chrome Food and Spirits, says her small music venue is one of those having a tough time staying afloat and selling.
“We’ve actually had some people come in and take a look and make some offers. They were not at all what we were looking for. They were very low what our asking price was,” Cherry says.
“We really don’t know what people’s agendas are when they’re trying to purchase a business. They could be completely genuine, or there could be a backstory behind it. Sometimes when you’re trying to sell a piece of property that you know is worth a lot of money, people to try to come in low hoping you’re desperate enough to sell,” she goes on to say.
“The folks that are opportunistic are looking to get a deal and pray on somebody that’s been negatively affected by COVID,” Verro agrees.
Whether buying or selling, Verro says it’s important to stay optimistic yet realistic.
“Sellers need to be realistic and realize how much it cost them per month to continue to hold the property and to look at an offer that’s realistic and not necessarily think just because their interest rates very low that they’re going to get a premium at this time,” he explains.
Overall, the commercial real estate industry bounced back remarkably fast, Verro says.
“The first day that we were allowed to re-open, my very first appointment turned into a lease. There was a lot of pent-up desire to come up with a game plan, and depending on what type of field or industry the tenant or buyer is in, they may have been more or less affected by the pandemic,” Verro says. “People that are out and about and looking now seem to be more serious than they have been in the past prior to the pandemic. They are doing so because they either want to possibly own their own building or lease a building that doesn’t have as much shared space and protect their staff and clientele.”
Meanwhile, McDermott says he’s extremely confident in AJ’s Pizzeria and thinks they’ll make it through just fine.
“It’s been overwhelmingly positive so far about keeping it open, how much they love it, how frequently they order here, so it’s been very positive freed back from the community,” he says. “It’s always been a dream of mine to own my own business, and I’m confident that even during the pandemic, things are going to work out and we’ll make it even better.”
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