Checking In: LES Venue Arlene's Grocery On How Music Venues Are Struggling To Survive During COVID - Gothamist

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Checking In: LES Venue Arlene's Grocery On How Music Venues Are Struggling To Survive During COVID - Gothamist

Like many independent NYC performance venues, longtime Lower East Side live music dive Arlene's Grocery is hanging by a thread after nearly a year of closure due to the pandemic. The owners announced this month they will have to close by the beginning of February 2021 if they don't get immediate financial help.

"After 25 years of serving the Lower East Side, and giving a platform for musicians and artists alike, Arlene’s Grocery is on life support," the owners recently wrote on Instagram. "Without any aid we will not be able to continue to serve our community and will be closing our doors on February 1st. The owners and staff members are absolutely heartbroken." They added that they are "in desperate need of your help," and started a GoFundMe.

The longtime venue at 85 Stanton Street has been a staple of the city's independent music scene since 1995, with the likes of Arcade Fire, The Strokes, Lady Gaga, Jeff Buckley and Lana Del Rey all performing there.

Several days before the federal relief deal was reached in Congress, Gothamist checked in with Arlene's Grocery general manage Jennifer "Blue" Gonzales and co-owners Dermot Burke and Richard "Tony" Caffrey to talk about the struggles that music venues have faced during the pandemic.

The staff at Arlene's Grocery, including Jennifer Gonzales (polkadot dress in front) and Tony Caffrey (center left) Arlene's Grocery

How was the business doing pre-COVID? Were things been pretty steady up until then?

Dermot Burke: Yeah, business was good all last year right up to March. We were doing fine. There was plenty of tourists around as well as the local guests. There were people coming from Brooklyn. And you know music venues and particularly small clubs are very expensive to run, even in the best of times. And we were doing fine.

March came, and all the venues were asked or decided to immediately shut down. At that point in the year, what did you guys think was going to happen? Were you projecting that this was going to last this long or how you were going to get through it?

Tony Caffrey: We figured it would be two weeks to a month and we could ride that out. The momentum was still moving forward, so we took time to spruce the place up and fix all the things that we couldn't do when we were open, figuring that we'd be back open in a month or so. But we had no idea starting out that this was going to be a scenario that could ever run this long. We have survived every other catastrophe that has been in the city, but this was one that really affects our business, because we are social people and that's our business, to be social. And to have that taken away, it's not something that we've ever dealt with before.

Jennifer Gonzales: We had some artists that were going to come through with The New Colossus Festival, which was a showcase of bands happening throughout the city at multiple locations [it was originally scheduled for March 11th-15th]. When the worst started happening, we didn't know what to expect. And I think that all the venues felt like we just wanted to try and get this festival going, figure out what to do with it. And then [COVID] happened in a blink of an eye, going from something that was just talked about a little bit to something that was increasingly getting worse by the hour. So it was really quick.

Caffrey: It happened so quickly, particularly since we were having such a great run with a lot of great new artists that were coming to play. The club was doing better than ever, and so this was like getting a slap in the face really. It just knocked us back, never thinking that this would drag on for so long.

Gonzales: It's also our 25th anniversary year. So I think we were expecting to have a really celebratory year with some alumni artists, and a lot of the community coming in and celebrating the 25 years of our existence. So it was definitely shocking.

Did you receive any PPP [Paycheck Protection Program loans] during this?

Burke: Yes we did, and that was a saving grace for a few months. That really helped. But you've got ongoing bills that just keep on coming in. It really helped at the time, I wish another one would come along, or some sort of government help at this stage.

How long did that last, did that get you through the summer?

Burke: Yeah. It got us through the summer. And we talked to different vendors, we did a lot of maneuvers to try and cut back on expenses. Our insurance on an ongoing basis is up to $50,000 a year for a small club. When the pandemic hit last March, it brought some things down quite a bit, but you still have to pay a lot of bills. We renegotiated with the landlord as well. But there were bills that were already sitting there due the next month.

Gonzales: I'm sure you'll hear over and over again that [PPP] wasn't necessarily structured for our industry. It was tailored to a little bit more to businesses that were able to keep a lot of the personnel on payroll, that was what the structure was of it. So for us having to shut our doors, there was a large portion of it we weren't allocated to use. So that made it a little bit difficult, particularly for people in the arts. There were no people to put on, because there was no way we could keep our doors open to be able to staff. So it got really tricky on how much of that we can use that was forgivable.

How many employees did you have pre-pandemic and what happened with them—were they laid off, paid for a certain amount of time?

Gonzales: Well, when the doors closed, we didn't really think it was going to be long. So we just said, we're going to have to lay you off for the moment. And then, we quickly realized that with our doors shut and how things were transitioning and what our regulations were, we realized that we would just have to keep the staff off. So we started with about 25 people, that was with production and bar staff. And then we went down to nobody for awhile there. And then we brought on one or two just to help out. But even that is consistently having to fluctuate from, are you working and then not working, just because we have to be able to pay for their time.

During that period in the spring, summer and early fall, when you were not able to put on shows or any sort of events inside the venue, what were your days like? What were you doing during this period?

Burke: I spent time with Tony, and the two of us fixed a lot of stuff that needed doing that we just could never get around to when [Arlene's] was open. We just put on tool belts ourselves and got busy with that. That kept us going for quite awhile. And then we built a structure outside, anticipating that we might get some people that would sit on the sidewalk. We kept ourselves busy with stuff like that, and biting our nails and worrying.

Gonzales: It was also the time of the Black Lives Matter movement, too. So we tried to be able to use our platform to help raise some funds, putting a portion of our tips and sales toward that. So I feel like during the beginning of that time period, there was quite a lot going on, on top of just being shut down.

How much money have you been able to raise so far, and has that gone towards paying off these bills, or gone towards the employees who are still working there?

Gonzales: Originally, before we knew the extent of what we were actually dealing with, we immediately started a GoFundMe to just help our staff and give them funds. And Dermot and Tony also were really gracious with our staff, because they got the rug pulled out from under them as well. So we raised about $7,000 to divvy up between the staff originally. And then probably about three or four months ago, we switched it over to Arlene's, because the stimulus packages were still pending. But originally we raised about $7,000 for our staff. And then we raised with our recent efforts, our call to action, we raised another $24,000 with GoFundMe merchandise and people coming in and supporting.

So that's been really great. We have an $80,000 goal to hit, because I think something to note is with us trying to stay open, there's been a lot of ventilation construction and heater construction and creating our outside dining space. And so we've accrued a little bit of bills there, on top of the rent that they've been great about negotiating with us. So that is a piece of what we will be able to pay, but there's quite a bit left.

Do you have any idea how much money you've lost this year, compared to previous years?

Burke: It's quite a lot of money. I'm not a numbers guy, but it was a substantial loss. Generally, we have 25 people working in the club at any given time. Nine months of lost income...you'd be talking about $900,000, something like that didn't come in. That's just off the top of my head. I'd need the accountant here, but at least that much money straight away that's just not coming through the door.

And then there's the other worry too: how do you get started again? That's the other problem, I think, for everybody. So if you survive this pandemic, getting everything kicked off and kicked into gear again, it's going to be very expensive. Getting in product and bringing the staff back in, and all that stuff. It's going to be a thing.

Caffrey: I wonder just how many people are going to come back right away, which is another worry. That's what I worry about, too. How long is it going to take for things to start bubbling again? I know that tons of kids have left the city, musicians and actors. A whole industry is nearly gone. All the people who were working in the bars and the clubs, a lot of them have left and went back to their home states. That whole thing has to readjust itself.

How do you all feel about how the city and state have handled the crisis, and in particular, the guidelines around live entertainment? Do you think that they have been too harsh, or has it been an appropriate response?

Burke: I think the only way we can think about it is that the people in the know knew how severe the situation was and they've dealt with it pretty well. This is something that's very, very real and not to be scoffed at. We were just one of many, I think everybody's just so greatly affected. I don't think anybody could wrap their heads around what actually was going on, and how real that this was.

Gonzales: I agree. I feel like there were a lot of drastic measures that had to be taken for people's safety. And I think it's everybody's concern to make sure everybody is safe. So they did what they did. It was shocking to our industry, but I think people's health and livelihood, our health and lives, are very important. So I think I understood that as well.

Caffrey: I think the only thing we have to go on is history and what happened a hundred years ago. The people that took the proper precautions seemed to fair better than people who threw caution to the wind. That is all that we can go on, and hopefully if they can come up with another stimulus package, if they're able to somehow send money our way, we all can sort of maneuver again.

Burke: I'm really disappointed in the federal government's response to the whole thing. To walk through Manhattan or Brooklyn or anywhere in the city, and just see what's happening to small business. People that have worked their fingers to the bone, as they say, and through no fault of their own, this whole thing hit and, to now have to watch them walking away from businesses, it's really painful.

You said you project that if you don't raise a certain amount of money with the GoFundMe by the beginning of February, you fear you're going to have to close for good. Could you explain that a little bit more—how much money do you need to raise to stay open? And is that also predicated on there being the Save Our Stages Act or some other federal money coming in as well?

Gonzales: Well, the original thought is just, you see the bank declining and declining and declining, and you just don't know what's going to happen. And we've all been holding our breaths for the Save Our Stages Act, trying to just keep going. With the Save Our Stages act, it's been in place for awhile now so we have been holding our breath for quite a long time. We decided that we needed to get our community involved, because we believe that it's an important institution for New York and the Lower East Side. So the goal was to do the GoFundMe because we were waiting for some federal help. We're pushing our date [for GoFundMe] out where we're able to have a little bit of time to wait for this to go through.

These funds that our community has been helping raise for us is really just to help us in any scenario, whether it be to get us to the stimulus or whether it be to get us to adjust another month or two to stay in the game. That's really what the basis was. There's not enough to keep us going to summer. I think everybody's trying to wait until summer, when there's a vaccine and there's all these things, but that doesn't mean that you have a bank account that'll help push you there. And also, it's mathematically impossible to sell enough to-go drinks alone.

Caffrey: I think the big thing is we worked a deal with the landlord for half rent, but we've fallen behind $10-12,000 a month. So we're at $80-90,000 already of back rent. He was gracious enough allowing us to float by, but he still wants his money whenever we ever get up and running again. Plus our insurance, that's almost $50,000 a year. All those bills keep coming. We didn't have money starting out with this. It's not like we have a lot of money in the bank ever, but we're just treading the water and trying to hold our finger on the dam to pay whatever bills are necessary. But you know, the rent and the fixed costs are there and they're accruing and we never thought about how now that it's 10 months later, we'd be this far behind. So it's a lot of catching up. We cannot make that money in the game that we're in now, even in the good times.

I know a lot of landlords would probably have closed us without assistance. So we're lucky that our landlords were actually working with us.

Burke: On that point too, the landlord was gracious allowing us to pay like half the rent and the rest of it be put on the side. But it's the stress of all that building up. If he hadn't come in and done that deal with us, with all this back rent, how would you even think about the future? Nostalgia won't pay the bills now.

[Editor's note: After the Save Our Stages bill was included as part of the recent stimulus package, we checked back in with Jennifer Gonzales about how this could help them]: "The Save Our Stages relief bill will give us the ability to pay the accumulation of debt caused by COVID closures/restrictions," Gonzales wrote in an email. "The package is geared to help the most effected businesses first. NIVA [the National Independent Venue Association] will be working to help these efforts as well, and we are thankful to be a part of them."

Sen. Chuck Schumer with Arlene's co-owner Dermot Burke (third from left) Arlene's Grocery

What have you heard from other places in the industry? Do you think that we are going to see a lot of places closing in the coming months, or are we going to see a lot of places just crossing their fingers and hoping they can get to summer?

Caffrey: I think you'd be lucky if 50% of the places are still open after this. People haven't got the money to come back out. They're scared. I think the pandemic has really hit people down. The gravity of the situation is enormous. A lot of people from every walk of life just don't have any money to start spending in the near future. I can't see a lot of places remaining open, I think it's 40-50% of places that will stay open, but that will be it.

I think you're going to see a big change in the landscape of the industry and hopefully we'll be one of those that are going to be lucky to hold on, to survive this, and we'll see where it takes us. But the whole scene is going to change, it has to change.

Burke: I think it's going to be more than 50%. The people we've been talking to are hoping some money will come, but the tanks are empty for a lot of people.

Gonzales: With the stimulus package that they're talking about, the support it'll give stages and restaurants, what's not included is a stimulus for the people. It's a whole ecosystem of how it affects our industry, because we are a people-based industry. So if they don't have the money to pay their mortgages and cars and bills, it really still affects us even when we open, [in terms of] how they can come in and share their finances with us.

We'll still have a lot of bumps ahead for those who do survive until a stimulus bill or until a vaccine, we're just going to continue to see places fall. Because we have such a long road ahead of getting back to some sort of normalcy, where not only businesses get back on their feet, but also individuals get back on their feet and are able to be able to go in for a drink and have a good time on a Friday. Or come back to a city and afford the rents. It's all very relative.

Is there anything else you just want to add about Arlene's particular situation, what it's been like trying to keep the business going during the pandemic, or what you are expecting in 2021?

Caffrey: I know that we're all in the same boat. I think people are going to be so cautious about coming out again, even when they have money to spend again. Our whole landscape has changed, and I think it's going to take us a long time to get over the fear of what's happened. I hope to be cautiously optimistic.

Burke: I'm just hoping that it doesn't take too long for things to start building up and for the city to start to get rolling again. That's a big question. Hopefully it's sooner rather than later.

Gonzales: I think some things that were really great that came about was the Save Our Stages organization [NIVA], that was a lot of independent venues across the nation. And specifically, in New York with NYIVA [New York Independent Venue Association]. We're always in competition [with each other] over acts and what artists are going to go where, that sort of head hunt, if you will. It was really great to see us all come together, and we communicate really well together. We put our voices together to be able to be loud enough to get into the stimulus. And I think the same is happening with a lot of other industries.

That's something that's really beautiful in New York that I don't feel you have in many other places, if at all, is that sense of fight that people have. And that's really great because you don't feel like the little person, you don't feel like the little small intimate venue that just has to get washed up. You feel like you have a community around you experiencing your pains and answering your questions, and you're able to answer theirs. It's this really great thing that has come from it that I think will last far beyond the pandemic.

Normally during crises, [our industry] booms because people want that good feeling, they want music and art and all these things. But this is the first time that we've been affected so much, we've never seen anything like this where our industry was shut down.

Burke: Our identity has been stripped. I think that's one of the biggest things is that we're in a state of shock and we're lost because our identity has been taken away. We're not able to do any artistic things. We're just trying to survive.

This interview has been edited and condensed.

2020-12-28 20:44:40Z
https://gothamist.com/arts-entertainment/checking-les-venue-arlenes-grocery-how-music-venues-are-struggling-survive-during-covid

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