BizWorthy: Coronovirus Will Affect Charlotte’s Economy. But How Much?
Charlotte, like many places, is beginning to feel the effects of coronavirus. Restaurants say they’re starting to notice more empty tables. Two large conventions planned for this spring have canceled. Charlotte’s largest airline carrier – American Airlines – announced it’s suspending some international flights through the summer and reducing seats on domestic flights next month as a cost saving measure. And now there won't be any Hornets games after the NBA cancelled the rest of the season.
For more on this and other business news, WFAE's Morning Edition host Marshall Terry is joined by Tony Mecia of the Charlotte Ledger Business Newsletter for our segment BizWorthy.
Marshall Terry: Tony, this is just the beginning of the economic effect of coronavirus. How far could he go?
Tony Mecia: Well, Marshall, it's an interesting question. You know, everybody wants to know what's going to happen. What's the effect going to be? The short answer is: We don't really know. But what we do know, based on my conversations with several economists this week, the economy really doesn't like uncertainty. And that's really what we have right now -- uncertainty. We don't know how this is going to play out. In three weeks, is everything going to be back to normal? Possibly. In three weeks, are we all going to be holed up in our houses, eating our beans and rice? We don't we don't really know. And so when you're in that kind of a situation, it's very difficult for businesses to make decisions on things.
So you can just think: if you were a business and you were hiring, would you go ahead and hire somebody right now or would you sort of wait and see how it plays out? I think what we're seeing is a lot of businesses sort of stepping back and saying, "Maybe we should just sort of wait a little bit in investing, in new equipment and hiring people." If people aren't going to the restaurants, like you mentioned, maybe they don't need as many waitresses at the restaurant. Maybe they can let some go and they don't have as many hours. And so you can see how it has a ripple effect.
A lot of times in Charlotte, we think we're inoculated from things like this because there's so much going on and there's so much construction. But, you know, we're tied into the global economy. And I think we are going to going to feel the effects of this. Now, there aren't any statistics out there yet. The statistics lag months behind what actually happened. So really all we have are sort of anecdotes at this point. Everybody wants to know what's going to happen and nobody does. And that's a little bit of a problem economically.
Terry: Well, some people are throwing around the terms "downturn, recession." Now, are those a little too far-fetched?
Mecia: Again, we don't really know. The economists I talk with think that, you know, is it possible that this could lead the U.S. into a recession? It could be. You're starting to see some possible policy responses in Washington to sort of juice things up a little bit to get the economy moving, because I think that is a possibility.
I think in the Charlotte area, our economy has typically been stronger than the national economy as a whole over the last few years. So I don't think at this point we need to be thinking about mass layoffs, the cranes are going away, there's no more construction and everything shuts down. That's pretty extreme. And I don't think people are seeing that. The economists I talked with said we will see an effect. It's probably likely to be slight and temporary. But, there will be some effect.
Terry: Some big changes are in the works in the heart of Plaza Midwood. Developers have purchased a 12-acre site at Central and Pecan. What are the plans exactly?
Mecia: Well, this is a property that's right there, middle of Plaza Midwood. It's that big parking lot, Central Square Shopping Center. There's a Five Guys in there, Bistro La Bon, ABC store. Big spot right there. Central and Pecan. And it was purchased last week. The purchase price was just recorded this week -- it was $50 million for a 12-acre site. And the people who bought it --Crosland Southeast and Nuveen Real Estate -- they say they want to put a mixed-use type of development there. Public spaces, walkable, a mix of uses. You know, there was some concern from the neighborhood and people around town (saying), "Oh, is it just gonna be a bunch of apartment buildings? Oh, that would be kind of boring." It sounds like they're actually doing something a little more creative, a little more innovative.
Terry: Plaza Midwood, like South End, has seen an explosion in development in the past decade. Is there room for anything else in Plaza Midwood without tearing stuff down at this point?
Mecia: Well, you sort of look around and you say, well, maybe there's not. But there's always stuff coming on the market and being redeveloped. There's nothing that sticks out to me as being like, "Oh, this is an obvious place to put something." But you never know. They can be very creative in where they build some of these projects.
Terry: Let's go now to Myers Park, where you report that development is prompting a longtime business there on Providence Road to move. And when I say longtime business, I mean very longtime.
Mecia: Right. Harry & Bryant Funeral Home says it's the oldest continuously operated business in Mecklenburg County, dates to the 1880s. Not always at that spot, of course. It was originally uptown when it started in the 1880s. There's a developer who says he would like to build an office building on that site, about two or three stories high. And that would force the funeral home to move to a site either across the street or maybe somewhere else. They're kind of uncertain as to what they're going to do. They're staying open and the plans will be will be worked out.
Terry: Finally, Tony, you made a big change at the Ledger this week. You put up a paywall and you wrote a piece laying out the reasons why you did that.
Mecia: So I've been working on this Charlotte Ledger Business Newsletter for a year. So, it's been free for the last year. And this week, I made two of the four editions available to paying subscribers only. I think there's a larger move in media toward membership revenue, toward reader revenue. So it's sort of tapping into that a little bit. It sort of gets back to the notion like you find pretty much in many other businesses that if you find value for something, that you pay for it. And so I'm trying to deliver value to my paying customers -- but I will still deliver value to to the people who receive the free editions, as well.
Terry: All right. Thanks, Tony.
Mecia: Thanks, Marshall.