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Sandy One Year Later: A Story of Small-Business Regeneration

Long Beach, N.Y.

Dr. Sean Pastuch, a chiropractor, and his business partner Mike Abgarian were forced to close their original CrossFit location in Long Beach, N.Y., after the establishment suffered a "complete loss," when water, sewage and fuel rushed into the gym during the storm. 

At the time, they were also negotiating for a second CrossFit location in Brooklyn, N.Y., which they have since been able to complete by partnering with the Aviator Sports and Events Center, however they have not re-opened the Long Beach location.

They've opted to open a gym in the neighboring town of Island Park, N.Y. but are unsure if they will return to Long Beach because many homeowners are still not home yet and many renters in the seaside community were forced to find housing elsewhere. Pastuch says the team doesn't know enough about the new demographics in Long Beach to determine if it will support two CrossFit's so close. Additionally, its original location - in a strip of stores - was not suited for the gym's needs, he says in retrospect.

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"It's difficult to find the right type of building for the right price. Long Beach was not a home-run hit for us financially," says Pastuch, who also operates his clinic out of Island Park. Still, they're keeping their options open.

In the meantime, Pastuch and his partner have been successful in the new locations and he talks of lessons learned from the storm.

A major lesson for the gym - besides purchasing flood insurance - was to improve upon its email and social media outreach to members and learn how to cultivate new customers at a more aggressive pace than previously.

"Because of the storm we probably lost $120,000 to $130,000 if not more," Pastuch says. "We lost 60% of membership when we re-opened and then it was about getting those old members to come back and finding new people to join our community, which by the way, the people we have in our gym are incredibly resourceful and incredibly dependable. Our membership base was basically what got us through everything."

Business now is good and getting better, he says. "It can always improve. We like to continue to build on it, but business has definitely improved. We have more members than before the storm. We were a little more aggressive about getting people back into the gym," he adds. 

The clinic was tougher to get back up and running. After being closed for six months, patients who needed his services went elsewhere for treatment. "I went from seeing 70 patients a week to seeing three when we re-opened. We are just now back to where we were before the storm," he says.

"It sucked, but it sucked for everybody. We had no choice but to continue to move forward and that's what we did and hopefully we don't have to do it again," Pastuch says.

Though it's hard to give an overall tally of just how many businesses were forced to shut their doors because of Sandy -- in terms of Small Business Administration assistance, Hurricane Sandy is the third largest natural disaster event in U.S. history, after the combined Gulf Coast hurricanes Katrina, Rita and Wilma in 2005, which in total cost $10.9 billion, and the Northridge, Calif., earthquake in January 1994, which cost $4 billion, according to the SBA. (Applications for SBA disaster loans related to Sandy have since closed.)

As of press time, the Small Business Administration approved 36,634 Sandy-related loans worth about $2.45 billion to individuals and businesses across New York, New Jersey, Connecticut, Rhode Island, Maryland, Virginia and North Carolina. The vast majority of those loans were for individuals; while just $484 million, or 4,110 loans, were specifically business disaster loans. (The SBA's Disaster Assistance division did not close during this month's government shutdown.)

There are a host of reasons why the business loan number was so relatively small - some businesses chose not to take on more debt, others were denied by the SBA when they couldn't show enough income to satisfy the agency's loan eligibility, at least in those first few months. Another factor was the lengthy and document-heavy application process, which could prove futile if a business owner lost all of his or her paperwork as a result of the storm.

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