Loi Krathong 2021

Don't Look Back in Anger

11/19/2021 Soundtrack: Sounds of Loi Krathong 2021

It’s Loi Krathong in Thailand, a festival that takes place on the night of the full moon on the 12th month of the lunar calendar when folks loi (float) a ritual vessel made of banana stem (krathong) down the river with a wish and loi khom (paper balloons filled with hot air from a candle dangling below) into the sky to carry away their bad karma from the year just gone by. It was a year ago today that I announced the permanent closure of the existing Pok Pok Restaurants and my move to Thailand, so it seems fitting time to float this missive, sending a wish down the currents for a brighter future and to exorcise some of shit that hit the fan in the past 18 months or so.

A year ago I wrote about why I decided to close Pok Pok in an Instagram post which has seen thousands of interactions and comments. I am now going to attempt to describe the “how” of going from operating eight restaurants and two commissary kitchens to being closed up and moved on. (My relationship with time is tenuous so the sequence may be somewhat askew but the events are all real.). Here goes:

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Once the decision was made to pull the plug, the first thing to do was to inform our employees that the lay-offs we had hoped would be temporary were now permanent. As I mentioned in that IG post, this was the hardest part of the process mentally and emotionally. With millions of other hospitality industry workers, our folks faced an uncertain future but were lucky enough to be able to receive enhanced unemployment benefits. Right away, we distributed to our employees as much of the fresh and frozen food we had in storage as they wanted and then the rest to food banks and community kitchens. We made a deal with a ghost kitchen operation to donate several thousand pounds of Ike’s Vietnamese Fish Sauce Wings to be sold for the benefit of the Immigrant Legal Resource Center. We even donated cooking equipment and food to some folks who were feeding the BLM protesters in the early days before it really turned ugly but it was all confiscated by the cops the very next day.

Next, we had to face the fact that we were on the hook for 7 leases, none of which had what we call in NYC real estate terms a “good guy clause”, with a liability way north of a million dollars in rent due over the life of the leases. Some of our landlords temporarily deferred rent or offered discounts but none of them waived any rent permanently (BTW, I hold no malice about this; they were not getting any relief from their own expenses either).

The only way out was either to sell the leases in a transaction called an “asset purchase agreement” (buyer pays seller for the contents of the restaurant, the lease and the advantage of having a grandfathered in restaurant space that can be operated immediately with just a change of license holder and no need to re-permit the space), come to a lease termination deal with the landlord (pay them all or some portion of the remaining lease liability to get out) or to declare bankruptcy and walk away.

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Given the cost of lease terminations and the ill advised third option, we decided to put the spaces on the market, a few at first and then all of them later. I was not optimistic this would work given what the medical professionals were saying about the trajectory of Covid. Surely nobody would want to open a restaurant at the beginning of what was likely to be a 2 to 3 year shit show? Luckily I was wrong...not about the trajectory of Covid but folks’ willingness to open restaurants in the face of that reality. We found a really cool broker (thanks Tamer!) who agreed to market the spaces for a flexible fee that amounted to at least whatever our rent deposit was on each space and much to my surprise there was demand. We managed to sell the leases to 5 of the spaces, give one away for free and pay to get out of another. All of this took about 5 months to complete. It was not easy and caused a lot of stress but in the end all the landlords agreed to the transfers and the buyers came through with their obligations.

We also were selling off business assets like used kitchen equipment, computers, vehicles, a food cart, office equipment, art and decorations, groceries and the detritus of opening, closing and operating a large group of restaurants over the years. The money from the sale of the leases and all that stuff went to paying debt like back rent, the one lease termination deal, payroll for our remaining staff, overhead such as insurance and utilities on the remaining spaces. This plus a PPP and EIDL loans were enough to keep us out of financial ruin, though not out of debt. We applied for an RRF grant but did not receive it before funds ran out.

Once we got rid of all the leases and realized we were not going to reopen the original location either, I decided to sell the Pok Pok Division Street properties. I was lucky enough to have bought the restaurant property before opening back in 2005 and the one next to it more recently (by this time I was living in the next door house which had served as our office and operations center for a few years as I had to sell my own house to pay off debts); this was supposed to be my retirement nest egg… but with debt looming from the PPP and EIDL loans, carrying costs for the property while not generating any income, mortgages and some other business related debt, I did not see another way forward. Once again I was skeptical of a sale given the mid pandemic real estate market for commercial spaces (the residential market was booming but the commercial was not) and once again I was wrong. It took a while to find the right buyers, but we actually ended up with two parties bidding against each other and ultimately working with each other (such are the oddities of the real estate game). The deal was finally closed after several months, allowing us to pay back a couple of huge loans that we had leveraged from the property to expand and operate the restaurants.

In the background of all this we were winding down the business and believe me, closing 8 restaurants is almost as hard as opening 8 restaurants. Restaurants have hundreds of vendors, service providers, contracts, tax liabilities with different entities, leases, loans, utilities, facilities, etc…just an absurd amount of threads that all need to be sewn up properly. I won’t bore you with details but we had a team of 5 people working full time for 5 months after closing down and even now, to this day, we are still unraveling with two people in Portland on the payroll, albeit part time, and myself here in Thailand dealing with the last of the comet tail.

During the wind down, one of the team fell off the back of a delivery van unloading a piece of equipment and broke his wrist, one of the team became pregnant, one was in isolation, I developed a lung condition (yikes) and everyone was stressed to the max.

By the time the deal closed on the final property I was already living in Thailand and had almost no physical ties left with Portland; just some books, guitars and clothes, most of which I sold when I came through the USA in June of 2021 for a quick visit to get vaccinated and wrap up loose ends. Shortly after that, our licensing deal in Las Vegas ended and there was nothing at all tying me to the USA except friends and family. Now I was fully committed to living in Thailand.

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How does it feel to be out of the game? It’s a mixed bag but mostly it feels right. I’m 58 in a month, my body can no longer weather the 14+ hour days and stress level of running restaurants and my window for enjoying life outside of work is getting ever smaller. Having said that, I do miss the excitement of opening a new spot: locating a space, imagining a concept, planning it, building it, getting a team together, pushing to open, seeing it develop…it’s just that right after these scenes play through my mind, the visions of the cold hard reality of managing the place crashes the party. Luckily, I can live vicariously through my friends who are still doing it but mostly that just confirms my convictions!!

So what is next? I’ve got some irons in the fire.

1. I have been learning how to rewire my brain. 15+ years of super intense focus, insane work schedule and stress from running a business with no partners can lead to some pretty gray places. Learning to prioritize health and personal relationships over work is not easy when you have been so single minded for so long. It’s hard to this day not to wake up and jump on the computer before making breakfast for my wife and getting some exercise. I still walk by spaces and immediately start thinking about what kind of restaurant I could open there. I find myself not knowing what to do with myself because the phone isn’t ringing constantly, the emails have slowed down to a trickle, there’s no plane I have to hop onto to make it to a food festival, book tour or a restaurant in another city. Low level depression is always knocking on the door and working was what kept it at bay before; now coming to grips with it requires a new strategy that I have not figured out yet, so I stay busy in other ways. Unfucking what I have done to myself over the years is going to take some time.

2. Over the last 8 months we bought and refurbished an old shophouse halfway between two of Chiang Mai’s most famous old markets and have leased it to a chef friend who’s going to do what I don’t have the will to do: open a damn restaurant!

3. I have partnered with Bo and Dylan from Bolan and Paolo Vitaletti from Appia on a project that will be a no-waste market, food hall and cooking school that helps farmers bring their crops to market, employs disadvantaged youth and acts as a community resource for like minded folks. It’s not my vision so the pressure is a lot lighter; mostly I am helping make sure it gets built out properly as I have a bunch of experience with that stuff. This joint is right across the street from our shophouse in a really cool up and coming neighborhood that is locally focussed rather than pointed at tourists. I’m excited about that!

4. I’ve launched a website offering my services in exchange for money…still gotta make a living! I reckon a lifetime of restaurant and construction work has left me with some skills that might be marketable.

5. Got some work through a couple of travel agencies in the new year to show folks around Chiang Mai on a food tour and maybe teach a cooking class or two.

6. Banh Mi has always been somewhat of an obsession for me and 2 years ago I visited Saigon with Austin Bush to research the making of the bread, him for an article he was writing, me to learn how it’s made professionally. Since then I have probably made 100 batches or so and think I’ve got it nailed. This has been very satisfying because a) I’m learning about baking, I definite weak point in my culinary skills, 2) There’s no rush as I am not planning on opening a banh mi shop…yet (see? I can’t help it!), 3) it scratches my itch for researching, working on and eventually becoming proficient at something I love. Also, the ducks and chickens have gotten to eat a lot of bread!

7. I’ve committed to writing on Substack. I’ve never thought of myself as a writer but I have always written. I’ll give it my best shot, for what it’s worth. Also, I’m supposed to be writing a cookbook proposal…sorry JJ.

So there you have it. I consider myself lucky. I got out at the right time and despite the drama and trauma of the whole situation, it was the right thing to do. It could have gone a lot worse; for many it did and for many more in my erstwhile industry it will, most likely. This shit is far from over and the challenges are multitudinous. For my friends, acquaintances and compatriots still on the hustle I wish the best. For those thinking of jumping into the restaurant ownership game, I urge caution but wish you the wisdom and strength to make the changes needed to bring the culture to a better place. For folks like me who hopped off, I don’t blame you in the least. Su Su khrap (keep fighting) whatever the situation. I’ll be here in Chiang Mai taking it a day or two at a time. But more about that later… 🙏🏻