It’s Memorial Day, the traditional kickoff to the all-important summer tourism season in Traverse City. But this season promises to be like no other: no Cherry Festival, no Film Festival -- but lots of questions. So what’s ahead? The Ticker explores four key questions that will likely decide the fate of summer 2020.

1. What’s summer without festivals?
TC is staring down the barrel of something unprecedented: a summer without festivals. Traverse City’s two tentpole summer events – the National Cherry Festival and the Traverse City Film Festival – are both off the schedule for 2020. Other popular summer traditions – from the Interlochen Arts Festival to Pride Week festivities to the July 4th fireworks – are also cancelled.

“Who even knows what a summer without those festivals looks like?” says Trevor Tkach, president and CEO of Traverse City Tourism. “The Cherry Festival alone has economic activity of more than $25 million. You can't replace that."

"We'll have some tourist business, definitely,” he says. "But it'll be a much different type of business than what we're used to."

Will money still come north?

"Probably, to some extent," says Tkach. "But it won’t be at the same level and I don’t know where it’s going to get spent.”

Tkach talks about travel in the wake of COVID-19 like a professor talking through a math problem: He starts by cutting the market by 35 percent – a conservative estimate, he says, of the contingent of would-be travelers who are likely to forego travel until there is a vaccine.

The next cut is most of the population that falls outside of a reasonable driving radius. An April survey by the International Air Transport Association (IATA) indicated that only 14 percent of travelers would be willing to fly immediately, while just 40 percent would consider getting on a plane in the six months after COVID-19 restrictions start to lift.

“What some of the national indicators are pointing toward is that, when people do start to travel again, they're going to want to have a lot of space,” Tkach explains. “They're going to want to be out in nature. They're not going to want to go to big metros. They're going to want to be in more secluded destinations."

"I think we have an opportunity to capitalize on what will likely be a smaller travel market this year, because we are a more appealing destination, we've got the ability to tell a story probably better than our competition, and our hotels are ready to get back to business,” he says.

2. What to expect from the downtown reboot?
Even without festival traffic to plan for, the Downtown Development Authority (DDA) is working to make sure that downtown remains a place where people feel safe spending time and money.
The DDA has pitched plans to close two blocks of Front Street this summer, from Park to Union streets. That strategy would allow more space for pedestrians to social distance while also providing opportunities for businesses to set up on-street retail and dining.

“We're looking outside of the box,” DDA CEO Jean Derenzy says. “Space is going to be important this summer, so how do we get that opened up?"

"Nothing is off the table," she says. "We just know that, to be able to make sure that people are comfortable coming downtown to help the businesses, we're going to have to do something different.”

Even though much of downtown Traverse City has been closed since March, the local community has taken significant steps to support the businesses there.

The DDA saw success this spring with the Buy Local, Give Local campaign, which aimed to raise $10,000 for downtown businesses. The DDA ultimately raised more than $61,000, which has helped support more than 120 businesses. Now the DDA has installed nine hand-washing stations throughout the downtown shopping district, is providing face masks for downtown businesses, and has established a recovery team to help advise business owners.

“Downtown has been rocked and our community has been rocked by this pandemic,” reflects Derenzy. “But we will restore the heart of our community, in our downtown, by doing this together. That’s something I would call special.”

3. How will the economic downturn hit Traverse City?
More than 1.3 million Michiganders have filed for unemployment since the middle of March; roughly a quarter of the state’s labor force is unemployed. According to a survey conducted by the Small Business Association of Michigan, 60 percent of Michigan businesses have laid off at least one employee.

These figures paint a sobering picture of Michigan’s future – not just for the coming summer, but potentially for years to come. The good news is that Traverse City could prove to be more insulated than other parts of the state.

In April, Bridge Magazine took a county-by-county look at how different parts of the state had been hit by unemployment since the coronavirus crisis struck. Grand Traverse County’s April jobless rate was estimated at just under 20 percent, much lower than most other parts of the state.

Still, area hospitality and tourism businesses have already been hit hard by COVID-19. Tkach notes that larger properties such as Grand Traverse Resort and Spa have been particularly impacted, due mostly to the hugely significant -- and lost -- conference and event revenue.

“I think we're going to see a lot of businesses go out of business,” Tkach says. “Hotels are going to have a really tough time. Most of them have to make their money in the summer to survive the winter, and if they don't make any money this summer, I think a lot of businesses are going to struggle to get through the winter months.”

Warren Call, president and CEO of Traverse Connect, says his organization will do what it can to support hospitality and tourism-dependent businesses, though he also sees COVID-19 as a wake-up call for the area to continue diversifying its economy.

“This crisis is a perfect example of how, when the tourism industry has a cold, our area has the flu,” Call explains. “We need to be broadening town attraction and business development to help diversify and build our economy in new areas, such as technology and the traded industries.”

Call thinks COVID-19 could actually help bring new businesses and professionals to the area, if only because it’s shown that remote work is a feasible option for most industries.

“The world right now is going through a huge experiment in remote work,” Call says. “What you're going to find is companies that didn't embrace it in the past are now forced to, and they're going to see that it’s not so bad."

Call says the opportunity is "huge" for the Grand Traverse region."Think about all the people in in big cities right now that have some affinity for northern Michigan. Some of those people are going to be asking, 'How can I start a new business in northern Michigan?’”

4. What about the ‘question mark’ events?
At least two major events – Traverse City Horse Shows and Ironman – are still tentatively on the schedule for the summer. If they go ahead, they could provide an influx of tourism dollars.
Traverse City Horse Shows – which consists of both the Traverse City Spring Horse Show and the Great Lakes Equestrian Festival – has postponed its first event (originally scheduled for June 3-7) and is now aiming to begin its season on June 17.

Managing Partner Matt Morrissey says tweaking the schedule is complex – given that Traverse City Horse Shows is planning on 11 weeks of competition this year – but that safety of staff, participants, and the local community is the top priority.

Morrissey says the national and international governing bodies for equestrian sport have instituted new safety protocols – one of which bars all spectators at events for the time being. As a result, there will be no audience members at Flintfields Horse Park this summer for any events, even if the competitions move ahead.

The organization is taking significant steps to make the events safer for staff and competitors, including hiring a safety director and eight staff members whose jobs will be dedicated exclusively to cleaning and sanitizing.

“It’s going to be a $500,000 swing, at minimum, between lost revenues and increased expenses,” Morrissey says.

From riders to horse trainers to veterinarians, Morrissey says that much of the equine industry has been out of work throughout the shutdown. That fact has generated extra attention and interest for any horse shows on the schedule that might still take place in 2020 – Traverse City Horse Shows included.

The Ironman race, scheduled for August 30, is also in limbo. Neither Ironman nor Traverse City Tourism, which pays to bring the event to northern Michigan, has yet cancelled or postponed the triathlon. Tkach says he’s working closely with officials to “be prepared either way,” and predicts that Ironman will make the final decision about two months ahead of race day.

“The nice thing about working with the Ironman organization is that they’ve got races all across the globe, every weekend,” Tkach says. “So, in real time, we're seeing how destinations are responding and how Ironman is responding."

This is an excerpt from a larger feature in the upcoming June Traverse City Business News. Subscribe to read this and more in the TCBN here.