Trouble for Retail – COVID 19 Blog Series

Mar 25, 2020

We Care.

Things are scary right now. There’s no sugarcoating this. In our new reality, it’s on all of us in the community to help. With that in mind, Matanky Realty Group is doing everything we can to help fellow businesses in the Chicago retail world.

We’ve put together a list of resources to help you get through this, and the challenges we’ll likely face in the coming months.

National Resources

The personal federal income tax deadline has been delayed through July 15, 2020. You can read more from the IRS here.

Facebook has set aside $100 million in cash grants and ad credits for small businesses. They’re still hammering out the details, but you can sign up for updates here.

Yelp is offering $25 million in relief in the form of waived advertising fees, and free advertising, products and services. They’re also giving free page upgrades like Call to Action buttons and Business Highlights. If you don’t yet have a Yelp page, you can get started with one for free here.

The below programs outlined below were enacted as part of the Cares Act. The precise rules and forms for these programs have not all been released yet. However, be sure to contact your bankers/lenders now so that you can be among the first in line to take advantage of these programs and obtain funding, hopefully during April.

Emergency Grants from the SBA
Immediate grants are available of up to $10,000 are available for eligible entities. Small businesses, sole proprietors, private non-profits, independent contractors, cooperatives, ESOPs, and tribal units, all with under 500 employees, can apply for loans in response to the COVID-19.The applying company must be in business for at least a year, which may be waived, but certainly must be before January 31, 2020. The entity applies for a small business loan through a lending institution who is authorized to make loans under the SBA’s current Business Loan Program. As part of that process, businesses can immediately request funds with only a tax return and/or credit score as determined by the lending institution/SBA loan process. No collateral or personal guarantees are required.

• The funds may be used for providing paid sick leave for employees unable to work due to the direct effect of COVID-19, maintaining payroll to retain employees during the disruption, meeting increased costs to obtain materials not available from the original source due to interrupted supply chain, making rent or mortgage payments and repaying obligations that cannot be met due to revenue losses.
• The applicant shall not be required to repay any of the amounts advanced even if subsequently denied a loan under the Small Business Loan Program.
• If an applicant received an advance as part of the loan process and ultimately is approved for a loan under the Disaster Loan Program, the advanced amount shall be reduced from any other loan forgiveness amount for payroll costs.
• These grants are available until December 31, 2020.
•You can apply to your local lending institution or bank

SBA Emergency Injury Disaster Loans (EIDLS)

•Loans are up to $2M.
•The term is 30 years.
•Interest Rates are 3.75% for small business and 2.75% for non-profits.
•The first month’s payments are deferred a full year from the date of the promissory note.
•EIDLS can be approved by the SBA based solely on an applicant’s credit score, not repayment ability. No tax return is required.
•EIDLS smaller than $200,000 can be approved without a personal guarantee. They are also not requiring real estate as collateral and will take a general security interest in business property.
•It expands access to sole proprietors or independent contractors, as well as tribal businesses, cooperatives, and ESOPs with fewer than 500 employees and all non-profits including 501(c)(6)s.


You apply for these loans directly through the SBA at www.SBA.gov/disaster. There are no loan fees, guarantee fees or prepayment fees. Make sure to apply for Economic Injury for the Coronavirus, rather than physical damage due to another disaster (that is a different declaration number).

SBA Express Bridge Loans
Express Bridge Loan Pilot Program allows small businesses who currently have a business relationship with an SBA Express Lender to access up to $25,000 with less paperwork. These loans can provide vital economic support to small businesses to help overcome the temporary loss of revenue they are experiencing and can be a term loans or used to bridge the gap while applying for a direct SBA Economic Injury Disaster loan.

• If a small business has an urgent need for cash while waiting for decision and disbursement on Economic Injury Disaster Loan, they may qualify for an SBA Express Disaster Bridge Loan.
• Terms: Up to $25,000, fast turnaround and will be repaid in full or in part by proceeds from the EIDL loan.

Find an Express Bridge Loan Lender by connecting with your local SBA District Office.

Paycheck Protection Loan Program Guarantee
Under this program, the SBA backs small-business loans through local lenders. Offered to small businesses with fewer than 500 employees, select types of business with fewer than 1,500 employees, 501(c)(3) non-profits with fewer than 500 workers and some 501(c)(19) veteran organizations that have to be in operation before February 15, 2020. Self-employed, sole proprietors, freelance and gig economy workers are also eligible to apply. Again, you have to be in operation before February 15, 2020.

Loans are given up to a maximum of the lesser of $10 million, or 2.5 times the average monthly payroll costs (including wages for employees $100,000 and under, as well as expenses for paid sick leave, healthcare and other benefits) during the 1-year period before the date on which the loan was made.

• The maximum interest rate under this program is 4%.
• The loan term is up to 10 years.
• No personal guarantee or collateral is required for the loan.
• Payments are deferred anywhere from six to 12 months.

This loan may be forgiven and not counted as income to you if it’s spent during the first eight weeks on operating expenses, i.e. payroll costs, excluding prorated amounts for individuals with compensation greater than $100,000, rent pursuant to a lease in force before February 15, 2020, electricity, gas, water, transportation, telephone, or internet access expenses for services which began before February 15, 2020 and group health insurance premiums and other healthcare costs.

In order for the amounts to be forgiven, you must maintain the same average number of employees for the first eight-week period beginning on the origination date of the loan as you did from February 15, 2019 - June 30, 2019 or from January 1, 2020 until February 15, 2020. If you don’t meet this requirement, the amount forgiven is reduced. You incur additional reductions if you cut compensation for employees who make under $100,000 by more than 25%, as compared to the most recent quarter.

You won’t be penalized for a reduction in employment or wages during the period from February 15, 2020 to April 26, 2020, if you rehire employees that you previously laid off or restore any decreases in wages or salaries by June 30, 2020.

You apply for the Paycheck Protection Loan directly through your local lending institution.

Illinois Resources

Cook County Financial Relief Package
Cook County is moving to waive various County fines, fees and deferring tax collections. Under this relief package, due dates for Home Rule Taxes like the Alcoholic Beverage Tax, Amusement Tax, Tobacco Tax and Gasoline and Hotel Accommodations Tax will be pushed back. Fines and fees under the jurisdictions of the Departments of Transportation and Highways, Environment and Sustainability, Revenue, Building and Zoning and Public Health due dates will also be pushed back.

Download the full list here.

The state is constantly updating its website and approach to help Illinois-based businesses make it through. They’re posting general information, Small Business Loan applications, helpful webinars and more, here.

Chicago Resources

All license renewals and fees are deferred until April 30, 2020 at the current time.

Chicago Small Business Resiliency Fund
Chicago Small Business Resiliency Loan Fund loans are designed to provide cashflow relief to Chicago entrepreneurs. Currently $100 million is earmarked for pandemic relief. The fund will begin accepting applications on March 31st. Interested businesses should fill out this interest form. It’s not an application, but you’ll get more details sent to you.

The Fine Print: There will be a cap of $50,000 per business. Each chosen business will also need to show a 25% or greater revenue decrease due to COVID-19, employ no more than 50 people and produce no more than $3 mil in annual gross revenue. Loan proceeds are required to be used for working capital. At least 50% of proceeds should be applied toward payroll and commitment to retain the workforce at 50% of pre-COVID-19 levels. You will need to provide a bank statement dating back to October 2019, your most recent tax return and a Photo ID.

More information can be found on on www.Chicago.gov. Funding will be given in order of application

Helpful Articles and Resources

Many publications are posting preparedness articles, how-to’s and important updates. Here’s a few of our favorite resources:

• Forbes shared this article on how to prepare for and weather a potential recession or market drop.
• Placer.ai, a data company, shared this retail impact tracker. It shows how brands and regions have been impacted by this pandemic.
• HoneyBook shared this business continuity plan. It includes 18 clear steps you can take to minimize the impact of COVID-19.
• The National Restaurant Association has compiled this list of resources for restaurants and cafes.

Here’s what you can to today.

Do you have medical gloves or masks going unused while your business is closed? Hospitals are running out of personal protective equipment and donateppe.org is here to help. They’re connecting medical facilities and communities so that our healthcare workers are safe. You can find out where to donate your excess equipment here.

Many businesses are adapting their stores to offer online, curbside or contactless delivery. Hair salons are offering their products “to-go,” gyms are providing paid online workouts and restaurants are selling family meal kits.

Local shops are also running gift card promotions, such as buy $20, get $5 free. This helps businesses get immediate cash while providing value to their customers.

If business is slow, take some time to reevaluate your social media and digital strategy. If you’re not sure where to start, you can check out our blog post on digital marketing for today’s brick and mortar retailers.

It’s difficult to stay positive in this mountain of uncertainty, we get that. We’re not here to tell you that it’s all going to be ok in a few weeks, and we’re not claiming to have all the answers. Instead, we’re hoping that by working together, we can all make it through.

If you have questions about retail, the industry or what you can do, we’re here to help. Give us a call at 312-337-1001.