[caption id="attachment_195626" align="alignright" width="274"] Matt Kern of Heirloom | Photo by Maria DeForrest[/caption] When your entire business model is based on hospitality, how can you offer that with social distancing requirements? That’s one of many questions that Matthew Kern, executive chef at Heirloom restaurant in Lewes, faced when Delaware entered the first phase of its reopening plan. “We offer experiences because that’s what the hospitality industry is. How can you do that 6 feet apart?” Kern said. “To open at 30% capacity will kill us. It’s only covering 30% of our bills, overhead and everything.” On June 1, the state eased restrictions on restaurants, retail businesses and hotels to open at 30% occupancy, but still maintains social distancing and cleaning practices. Customers are encouraged to wear face masks unless eating or drinking. Heirloom is still closed for sit-down service, since it would be “irresponsible to the staff to bring them back if the revenue was not there,” Kern said. Instead, the restaurant offers a periodic pop-up menu. Kern said that Heirloom will be back with a “fury” in future stages, although he did not specify when. “There’s some advantages to the beach, namely the great customer base you have here,” he said. “But it’s nine months of revenue within four months of work. Without having what we had before, we’re taking a considerable hit.” For the tourism industry, the first week of June will be the first time in 10 weeks since they were allowed to have customers inside their brick-and-mortar establishments. Hotels and short-term rentals can start booking rooms again, while restaurants can return to sit-down service with precautions like requiring reservations and limiting tables to same households. Retailers are welcoming customers inside after weeks of curbside pickup. “It’s no 100% but 30% is better than nothing,” Rehoboth Beach-Dewey Beach Chamber of Commerce CEO Carol Everhart said. “It will be difficult for some businesses to make a profit.” It’s hard to predict whether the visitors will come out like past summers or will be slow to trickle back. So far, Everhart has mailed out 70,000 visitor guides on request, a feat that would be done in a normal year by mid-July. But the hotel occupancy rate tells a different story, with 271 hotel rooms booked on the sunny weekend of May 15-17. The same weekend last year had 3,041 rooms filled, according to the chamber. [caption id="attachment_199815" align="alignright" width="645"] With Sussex County facing a decline of tourists amid COVID-19 pandemic, many business owners have a tepid outlook for this summer. | DBT PHOTO BY JACOB OWENS[/caption] “Reducing occupancy has been devastating,” Everhart said. “That’s going to have a chain reaction down the line, since hotel tax supports the marketing budget, beach replenishment and grants.” Beacon Hospitality Managing Director Chad Moore said that the Admiral on Baltimore hotel in Rehoboth Beach and both Microtels in Georgetown and Milford would not be open until June 5 so that the housekeeping and staff can complete training on new procedures. “This time of year, things are kind of quiet, so we thought to wait,” Moore said. “It’s going to take a while to get us ramped up, and the Admiral hasn’t been opened yet, so that needs to be deep-cleaned and get the cobwebs dusted off.” Beacon Hospitality’s hotels are following “common-sense guidelines,” like installing a plexiglass barrier at the front desk and disinfecting keys routinely. An appointed employee at each property is tasked with making signs and enacting appropriate measures. Housekeeping won’t make daily trips to rooms to take out the trash and swap out towels. Instead, guests will have to call to request that service. Moore plans on cleaning rooms and letting them sit for 48 hours between guests. “I don’t think anyone wants to be the poster child for what not to do,” he said. “It’s best to err on the side of caution.” It’s also the first week that movie theaters in the state have been reopened, albeit with a lack of the summertime Hollywood blockbusters due to the pandemic. The Movies At Midway in Lewes has opened only six of 13 theaters, with every other row closed. That reduces the 150-seat theaters to 40 seats and the 190-seat theaters to 60 seats. New seats were installed when the theater was closed in March. Moviegoers aged 13 and up will be required to wear masks until they are seated. “It’s going to look very different, but we’re very anxious to make it work,” Tiffany Derrickson, vice president of Atlantic Theaters, the parent company of the Midway. All tickets are $6 and no cash will be accepted. Two kiosks — which will be wiped down frequently — will be available for online pickup and ticket orders. For now, the Midway will air old favorites like “Jaws,” “Grease” and Harry Potter until film distribution returns to work. [caption id="attachment_199819" align="alignleft" width="498"] The Movies at Midway reopened June 1 with a diminished capacity, but it is also challenged by the lack of blockbuster movies released by Hollywood this summer. | DBT PHOTO BY JACOB OWENS[/caption] “It’s the first time in 100 years that the silver screen went dark,” she said. “During the Great Depression, people would come to forget their troubles for a while. We will do what we need to make people comfortable and safe.” Some restaurants are seeing added support from local officials by expanding outdoor dining options. Rehoboth Beach officials allowed eateries to use sidewalks and closed some parking on First Street to expand outdoor dining options for restaurants, losing about 200 parking spaces in the process. Over in Lewes, a similar proposal to close Second Street was shot down by downtown Lewes business owners. “It was considered a safety concern, and the sidewalks in the historic district are too small to use,” said Betsy Reamer, executive director of the Lewes Chamber of Commerce. “Some of our issues are that our restaurants are in small, historic buildings, and the challenge has been getting some of these businesses in open air.” The Lewes City Council decided to keep parking meters off in downtown spaces and lots until noon, hopefully spurring more people to come and shop. Business has been picking up since Gov. John Carney allowed retailers to open on an appointment-only basis. Now downtown business owners are allowed to put merchandise outside like a sidewalk sale until June 15,  the Cape Gazette reports. “They had no cash flow for two months at this rate, so they were grateful,” Reamer said. “We’re in uncharted waters, but we’re confident our merchants are up to the test to make people feel safe.” In central Sussex County, The Counting House restaurant will only be open on weekends to start, but with the hope to open more as time passes. Reservations will be taken ahead of time, and parties will be seated and served in two-hour blocks. The historic restaurant, bought by Bill Clifton and Miguel Batiz, in August 2018, has been closed since March 14. “You can’t get too down about it because it’s a virus,” Clifton said. “I’d feel differently if it was something I did.” The Counting House typically sees a lot of business from lawyers staying to do business in Georgetown’s court system, with some even ordering three meals a day. But Clifton also sees locals and visitors who don’t want to deal with beach traffic for a good meal. Memorial Day weekend did bring people south to the beaches, some for the first time in months. But Clifton doesn’t think central Sussex businesses will have it hard compared to the resort economy. “There might be more people with boatloads of money, but there’s also more competition,” Clifton said. “It’s so much revenue loss unless you own your place, and very few do there. It’ll be a fight for survival there this summer.”

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By Katie Tabeling ktabeling@delawarebusinesstimes.com