Baltimore business owners are bracing for a tough spring as authorities remove the collapsed Francis Scott Key Bridge, but many are hopeful the worst of the disruption will be short-lived.
Alex del Sordo opened his 30-year-old business with its own small marina just 10 days before the Singaporean cargo ship Dali crashed into a bridge on March 26, killing two employees and leaving. Acquired Hard Yacht Cafe, a historic waterfront restaurant. The other four people were presumed dead.
“We don't want to lay anyone off,” Del Sordo said Friday of the 75 employees. “We want to keep them here working, happy and healthy.”
For the past week, Del Sordo has been offering first responders 50% off at his cafe, which hurt his revenue. His biggest concern now is “stabilizing the cost of jobs and keeping the lights on,” he said.
Just because the bridge is closed doesn't mean Baltimore is closed.
He added that the restaurant's marina is typically booked with pleasure cruisers, but the marina cannot be relocated to accommodate bridge response personnel. “We don't know what to do with all the boats on our property. We don't know where they're going or how they're going to get out of here.”
Hard sailboats are perched on Bear Creek, the waterway that flows into the Patapsco River, where the Francis Scott Key Bridge spanned for decades. Some businesses in Baltimore's historic Dundalk neighborhood are being hurt by the disruption at the port as cleanup continues. Ships are currently suspended in and out of the Port of Baltimore, but trucks are still being removed from the marine terminal, a spokesperson said.
By the end of the month, the Army Corps of Engineers plans to open a 35-foot-deep limited-access channel near the wreckage to allow access for barges and small commercial vessels. The deeper 50-foot waterway, which will allow container ships to pass, is expected to reopen by the end of May. Currently, water depths open to vessel traffic are minimal, with only two of her channels being less than 15 feet deep.
While some local businesses have likened the impact to the early days of the pandemic, many say the upheaval of recent years has prepared them for a crisis of this magnitude. Still, a major part of the city and region's economy, from trucking to commercial real estate to local restaurants, relies on the port, which handled a record $80 billion worth of foreign cargo last year.
Michael Clarke, president of BTR Logistics, which stores and ships cargo at the port, said the loss of cargo “will probably impact 75% of our revenue in the short term.” Some ships that were scheduled to receive cargo at his warehouse after arriving in Baltimore are now held up internationally.
“We're doing everything we can right now to cut costs and survive,” Clark said.
Colin Tarbert, president and CEO of the Baltimore Development Corporation, an economic development nonprofit, noted that an estimated 20,000 local jobs are directly tied to the port. He said the biggest concern for surrounding businesses is how long it will take for port operations to resume at full capacity.
“The longer the channel stays closed, the worse the problem will become,” Tarbert said. Although rebuilding the bridge is expected to take years, he expressed confidence that trucks will be able to travel through the city's existing routes without significantly impacting business. While that may be an inconvenience, “just because the bridge is closed doesn't mean Baltimore is closed,” he acknowledged.
Clark said BTR is currently looking to reroute incoming cargo, primarily plywood and steel, to other ports on the East Coast, but obtaining interstate trucking permits is expensive and time-consuming. Ta. The company has applied for a loan from the federal Small Business Administration, but has already had to lay off about a dozen employees.
“Frankly, many of our customers have alternative arrangements with other warehouses in other cities, and until we resolve this issue, their goods may never come back here. “Yes,” he said.
It's going to be a slow couple of months, but demand for industrial real estate remains high.
The SBA is rolling out low-interest loans to small businesses to help them get through the coming weeks, and on Friday, Maryland Gov. Wes Moore announced $60 million in relief to businesses and workers affected by the bridge collapse. Signed an executive order providing funding. This aid follows $60 million announced last week by the U.S. Department of Transportation to support rebuilding efforts.
On Friday, President Joe Biden toured ongoing response efforts in Baltimore and reiterated his administration's support for recovery efforts. “It's going to take some time,” he said, but vowed that state and federal authorities will work together to “rebuild this bridge as soon as possible.”
Jim Chivers, senior vice president at Gold & Company, which serves the Baltimore metropolitan area, said he doesn't expect any lasting impact on the city's commercial real estate sector. “Everyone feels this is more of a short-term issue than a long-term issue,” he said.
Chivers is optimistic the region will recover. Even if some customers leave, he expects there will be a lot of interest in filling vacant properties.
“It's going to be a slow two months, but I think long-term values will continue to be maintained,” he said. “There is still a huge demand for industrial real estate in Baltimore.”
John Minadakis, owner of Jimmy's Famous Seafood, a family-run bar and restaurant just a few miles from the port, is already seeing a decline in foot traffic, especially during lunch. “Everyone in the community is still in shock,” Minadakis said.
He hopes the bridge removal and reconstruction effort, a process that requires many workers and personnel on and around the site, will bring in some business in the coming months. In the meantime, he's trying to maintain his balance sheet.
Minadakis said he was somewhat pessimistic about local businesses' ability to recover quickly. “This is going to last a little bit longer than COVID-19,” he predicted. “We are preparing for the worst.”