As soon as we realized there were fewer tourists, we went ahead in early March and waived rent for our tenants for April and deferred May and June rents, so that folks would not stress about losing their spots....
Gill Holland, Kentucky Businessman
When Gill Holland ran for Lieutenant Governor of Kentucky with running mate Adam Edelen, the Louisvillian had high hopes for what he could do for the Commonwealth. He and his running mate lost in the Democratic Primary to now governor Andy Beshear, whose become the poster child for how to hold a Coronavirus press conference.
Meanwhile, Holland’s $35-million Portland District project has become the face of “Unease,” according to the New York Times, as 40% of new construction projects are on hold due to the Coronavirus. Holland’s well-diversified, though, and is seeing some of his businesses thrive.
We caught up with the real estate and entertainment mogul to see how Coronavirus and Beshear’s policies are impacting Kentucky businesses.
You were behind NuLu and Portland's resurgence. How has the Coronavirus impacted these areas?
NuLu is the go-to stroll district for Louisville, a pedestrian-friendly local business, local food and arts neighborhood and while many of the restaurants are still open for curb-side/sidewalk pick up, the retail shops have been shuttered and there is very little of the life and vibrancy one normally sees.
We always say NuLu is a “state of mind” — an innovation district and close-knit community— so NuLu in that way has not been impacted. Folks are still supporting their neighbors! But NuLu has become such a tourist draw that over 50% of the retailers’ business comes from tourists. As soon as we realized there were fewer tourists, we went ahead in early March and waived rent for our tenants for April and deferred May and June rents, so that folks would not stress about losing their spots, because of a short term downturn. Hopefully, thanks to the aggressive state and local efforts related to the shut-down, it won’t be as painful and too drawn out.
Portland’s food and retail scene is still on the way up (and not nearly where we expect and want it to be in 5 years or so), so there are fewer visibly shuttered businesses. It is a historic 18th century town, so is still a dense residential area and many folks are out walking around, getting out of their 1,000-square-foot shotgun houses or sitting on the stoops and waving to passers-by.
Gill Holland invested more than $37-million into restoring the historic district of Portland in ... [+]
One of the properties at risk, an historic 1940s-era cafe. Gill Holland has invested nearly ... [+]
How can a small business survive this?
Creativity and flexibility is required on many levels. Prioritize and work with vendors and lenders to push back as many expenses to the fall as possible and don't be too proud or afraid to ask for favors and waivers of payment…Keep in touch with any employees you have had to let go for the near future, make sure they know where to get benefits, keep up the team spirit, work on future marketing and sales strategies, especially if you can ramp up online sales. Maybe a good time to finally update the company web-site. Appreciate the additional time with your family.
You ran against Andy Beshear for the Democratic ticket. How do you think he's handled the Coronavirus for the Commonwealth?
In an alternate universe, where Adam Edelen and I had won and were governing in Frankfort right now, I can only dream that we would be doing as good a job as Governor Beshear is doing! #TeamKentucky. I love that he has become a national darling for his even-keeled, thoughtful and responsible attention to the crisis.
The largest industries like UPS, Ford, Toyota, GM will have political connections to help weather the storm, so it is our local businesses that I have the most concern for.
What Kentucky businesses are thriving in this environment?
A local start-up that I invested in SwitcherStudios is doing great. It is for folks with iPhones/iPads who want to live-edit and live-stream events direct to Facebook / Youtube / Linkedin from different camera angles, so churches and other groups around the country are using it like crazy. Due to Covid-19, they recently launched a free subscription for their Louisville small business and non-profit neighbors. While our real property businesses are taking a short term hit from less rental income, my intellectual property businesses like film and music are doing great. Our record label sonaBLAST! is having its best month ever, with two artists in the Global Spotify Viral 50 streaming charts. Film is a bit more challenging (though the two films in edit stage are inherently at the social distance phase) since we were unable to premier our cannabis film “Freeland” at SXSW and are using alternate tactics to find a studio buyer. There are many start-ups in the tech space that are less impacted because of their employees' ease of remote working. Farms have seen increases in orders for local food. I never met a farmer in the decade-plus living in Manhattan, while in Kentucky it is fun to know and support the farmers who grow our food.
What Kentucky businesses are most vulnerable?
The most vulnerable businesses are the ones that give us our wonderful sense of place, the locally-owned restaurants and retail shops. Take out and curbside pick-up can never replace all a restaurant's lost revenue. And the local retailers do not have significant online sales. The largest industries like UPS, Ford, Toyota, GM will have political connections to help weather the storm, so it is our local businesses that I have the most concern for. The Louisville Independent Business Alliance is actively helping folks navigate how to access assistance.
Luckily our local coffee mavens Heine Brothers have drive-throughs at most of their cafes. I hope the local community banks can come out ok, with interest rates so low, and the potential for defaults rippling through the system, it will be harder for them than the huge national banks, and the local and rural banks that know us and know our local business are so important for our business community. Since some folks may think about bourbon and horses first, I will say that bourbon has always been recession-resistant (not recession-proof but resistant for sure), and the liquor stores are reporting long, single file lines. Out in the pastures, the mares are still foaling, oblivious to Covid.
On 15th and Lytle St, the East Portland Warehouse District, in Louisville, Ky., this beautiful all ... [+]
As for real estate, do you see this as an opportunity to buy in Kentucky?
Kentucky is always ripe for investment! I always joke that you can take two zeros off anything you were thinking of investing in on the coasts and come to Kentucky and really move the needle locally in an impactful way, whether it be start-ups, real estate or even the arts and philanthropy…and for folks who are interested in sustainable, responsible or impact investing, there is no better place in the US than Kentucky to have a long-lasting, positive impact with a lot less money than you would need elsewhere.
Kentucky Author Fred Minnick writes bourbon books, podcasts about music and bourbon, and is the editor-in-chief of Bourbon+ Magazine. Follow him on Instagram.
