Months into pandemic, exodus of Baltimore office workers leaves void for downtown’s small businesses

During the five months David and Shirlé Koslowski kept their Baltimore cafe/record shop shut down and employees furloughed, they figured out how to deliver food, sold records online and installed a carryout window in a historic building.

Since reopening Baby’s On Fire in downtown’s Mount Vernon neighborhood Aug. 24, customers have trickled back to outdoor tables and the new window on Morton Street — no one’s allowed inside yet to eat or flip through the collection of vinyl albums.

The small business has fewer employees, shorter hours and almost none of the regulars who used to come from nearby offices. It has far less business — sales are down about 60%. But the owners say they are not discouraged.

“I wish it was back to normal,” said David Koslowski, who has run the cafe for four years as well as another in Fells Point. “But we’re very thankful that we have outdoor seating. And people in the neighborhood are super psyched that we’re back.”

Seven months after the coronavirus pandemic upended life, downtown Baltimore businesses are still struggling. The Koslowskis, who used state grants and disaster loans for the carryout window renovations, say they feel fortunate that in their part of downtown, residents now working at home during the day help sustain them. But that’s not the case everywhere.

In much of downtown, office workers and college students have not returned, people won’t venture out more than necessary, loan payments loom for restaurants and stores, and a fix from a vaccine seems a long way off.

In a business district where once bustling sidewalks appear nearly deserted and “For lease” and “Available” signs cover a number of storefronts, some small merchants are barely holding on. Some worry that colder weather — and rising coronavirus numbers — will deter customers even more.

“It’s been terrible and not looking much better for winter,” said Dave Niehenke, a co-owner with his sister of Mick O’Shea’s pub-style restaurant on North Charles Street. “We’re still around, but we’re also in debt up to our eyeballs."

The business, which has worked its way up to offering dining inside and outside, in addition to curbside carryout and delivery, had its best month in September since the start of the closures. But that was at just over 40% of last September’s sales.

The restaurant offers delivery through UberEats, but the service takes a chunk of sales. And even though the city now allows indoor dining at half capacity, Mick O’Shea’s and other smaller places can’t even reach that level because of distancing protocols.

Niehenke, who has run the bar and eatery for nearly two decades, had paid off business loans and expected eventually to sell the business and retire. With a new round of emergency loans to pay off, that looks increasingly unlikely.

“It was already a tough business to begin with, and now it’s worse,” he said. “People want to argue about masks.”

Java Joe’s reopened on East Baltimore Street after Labor Day, but Michael Ditter, owner of the restaurant and coffee shop for nearly 30 years downtown, calls the level of business unsustainable, at about 20%. He used the closure to renovate and kept his workers employed. But his bread-and-butter customers, downtown office commuters, have stayed home or cut way back on office hours.

“If you’re coming to work and are making the trip downtown and going into your office for four hours, you’re not stopping to get breakfast or taking a break to eat at lunch, and that’s what we depended on, being the break in that person’s eight hour day," Ditter said.

Ditter sat at an outdoor table along the street Tuesday and lamented that he could take time to sit down during what in normal times would be lunch rush. Only a couple of customers walked in.

He’s kept the coffee shop going thanks to forgivable loans through the federal paycheck protection program. A growing population of downtown residents, many living in new buildings or converted office towers, has not been able to make up for lost sales, he said.

Downtown business groups say they have looked for ways to boost struggling merchants' during the health crisis, such as by creating more than a dozen “parklets” with tables outside restaurants along North Charles Street.

Businesses have said “this is really helping us survive and make it,” said Kristin Speaker, executive director of Charles Street Development, one of the nonprofit groups behind the effort. Speaker’s group, which promotes small business and investment on Charles Street, is now helping restaurants look for and purchase heaters for outdoor dining.

In another initiative, North Charles, from Saratoga Street to North Avenue, will be closed to vehicles Saturday in a COVID-19 version of a street festival. Organizers, including half a dozen neighborhood and business groups, say large gatherings are not allowed, but they instead want to enable people to stroll in a safe, socially distant way and shop and dine at small businesses hurt in the pandemic.

The Downtown Partnership of Baltimore also is working on business and consumer surveys that will measure impact from COVID-19 and help businesses plan for future business. In a survey released in June, taken shortly after the COVID-19 shutdowns started, 94% of downtown businesses said they felt an impact from the health crisis with more than 15% losing more than 90% of their revenue since March 1.

“Business are trying to figure out how do I adjust,” said Shelonda Stokes, president of the partnership. “Restaurants need to know so they can stock up accordingly. All of us need to work together and communicate in ways we hadn’t previously.”

Valerie Gittings hopes Saturday’s Charles Street closure will introduce her business, Smooth Wax Bar, to new customers and remind others the body and facial waxing studio in the 1100 block of North Charles Street is open. She can’t host anyone inside for the event — waxings are by appointment only — but will have an informational table outside.

Gittings, who kept the studio closed for three months, said business is down about 30% without college students and office workers from nearby state agencies and companies such as Agora. And less leisure travel has meant fewer clients booking body waxing appointments before trips.

She’s staying afloat by dipping into savings. She did not qualify for a federal payroll protection loan because her employees are independent contractors.

“Right now, we’re treading water and hoping that things don’t get worse or that more restrictions don’t go in place in the fall," Gittings said. “If there’s another wave, [of the virus], I’m not sure the business can withstand it."

Another unknown is when — or even whether — office workers will return at pre-COVID-19 levels. A nationwide workforce survey released Wednesday showed an increasing number of employers plan to offer remote work options after the crisis ends. The survey by getAbstract said the share of employers who plan to offer that choice increased to 38% from 20% in April.

Without office workers and hotel guests, Abdul Aziz, owner of Papa Menu grocery and convenience store on East Baltimore Street downtown, has little business left and no way to pay months of back rent.

In the spring he had to throw out dated merchandise that didn’t sell, then he lost more money over the summer when his store was broken into several times and he had to invest in shatterproof glass. Business is down by about half, and he has cut back on morning hours.

“We cannot make money,” Aziz said. “The city offices need to come back, then we can make money."