March 2, 2025 • 58 mins
On today’s program, we talk with anchor reporter,Ben Simmoneau of channel 5 WCVB TV about his story about rising natural gas rates. Greg Ryan, Senior reporter at the Boston Business Journal looks at the health of the real estate market in Cambridge’s Kendall Square. Chef Will Gilson explains why the DINE OUT program is so important to the restaurant industry. David O’Brien CEO of the Massachusetts Cannabis Business Association shares his thoughts on whether or not we will ever see pot cafés. And finally John Capone, managing partner of KPMG Boston takes a look at a new upbeat business survey.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
This is the New England Business Report with Joe short
Sleeve and Kim Carragan, a weekly roundup and discussion of
the top business news impacting our New England economy.
Speaker 2 (00:09):
Good morning, everybody, and welcome to the New England Business
Report on this Sunday morning. It is March, the second
Joe Shorts Cagan with you. Yes, the first Sunday in March.
Speaker 3 (00:20):
Yeah, I know.
Speaker 4 (00:21):
And here we march into year two of the New
England Business Report, and it's getting warmer out there.
Speaker 3 (00:25):
Kim, right, you're not. You're doing okay?
Speaker 2 (00:28):
You know, it's it's better. It's all relative, I guess, Joe, right,
it certainly is. Well this time next week we will
have gotten rid of daylight savings time. Think about that,
and we will be springing forward. So I like that
because it's obviously later in the evenings, but I don't
love it because I'm a morning person. So it gets
(00:48):
darker again in the mornings for a little while.
Speaker 4 (00:50):
Yeah, for a little while, but demonstraten itselfs out, you know, it.
Speaker 2 (00:53):
Does, and then we start just marching literally into real spring,
and I can't wait.
Speaker 4 (00:59):
Mark, Mark, just a tough one one though. March is
a tough one. You know, I couldn't agree with you more.
I always think that it's going to be warmer than
it is or prettier than it is.
Speaker 2 (01:06):
I couldn't agree with you more. I think I personally
think that March is the toughest month because you have
such anticipation, but it usually lets you down. And let's
take a look at the show today. We've got a
good one coming your way, everybody. First off, up, WCVB
news anchor Ben Simono is going to join us. Ben
has been the reporter on this incredible gas rate hike story.
(01:29):
He has been out there, you know, really pushing the
administration as well as some of these company leaders. He
was the guy I think that people started reaching out
to when they started getting these astronomical bills to begin with,
and sort of brought it to the the you know,
the forefront.
Speaker 3 (01:45):
So everybody jumped on it everywhere. It's a huge story.
Speaker 4 (01:48):
The Governor's now making it the mainstay for talking about
new legislation, and you know John chest with the globes
righting about it. I mean he really touched an nerve.
Speaker 2 (01:57):
Well, these gas rate hikes really touched a nerve. I mean,
you know, these people who are getting bills that are
three times what they got a year ago. That is shocking.
And there has been some developments, by the way, and
some of them are good, but some of them maybe
have a catch. So we'll let Ben sort of explain
all of that. I'm Ben Senior reporter for the Boston
(02:17):
Business Journal. Greg Ryan's going to be here. He's going
to talk to us about the future of Kendall Square.
Of course, that was an area where all the big
tech names, all the big pharma names, they were all
moving in there. Then COVID happened, and then a whole
bunch of other things happened, and suddenly they all started
moving out and rents dropped, and the neighborhood has changed
(02:39):
a bit. So some locals are doing their best to
maybe bring it back to its glory.
Speaker 4 (02:44):
Yeah, and Greg is going to walk us through that
Kendall Square a three point oh what will it look like?
Also on the program today, we're going to talk more
a little bit more about dine out Boston. We're going
to be talking with world renowned chef Will Gilson. Of course,
has a number of restaurants in Cambridge, the Lexington Cafe,
Beatrice Carpeto, Puritan and Company anyway. But it's all about
(03:07):
dine out. It's now a you know, you get a
discounted meal, so to speak. I guess it used to
be a week, then it was two weeks. This year
it's three weeks. So we'll talk to him about how
that works. And you know, is it drawing in the
you know, new customers.
Speaker 2 (03:21):
I have to assume that if you got involved in
you as a business owner and you knew that it
was three weeks, it must have been positive for you
in the past, right.
Speaker 3 (03:29):
Right, because I can't imagine.
Speaker 5 (03:30):
You know.
Speaker 4 (03:30):
We were had Martha Sherit and the president of Meet
Boston on this program last week and she says, you know,
they're reaching out, but all these restaurants are saying yes,
you know, we may have two hundred restaurants or something. Yes, yeah, okay.
Also part two of our conversation with a. Dave O'Brien,
CEO of the Mass Cannabis Business Association. Kim and I
were a little taken back by what he had to
say in his first visit last week. That's why we
(03:53):
have scheduled another conversation with him today. Talked about the
health of the state's pot industry, and things do not
sound well there in terms of what's going on in
terms of the price of pot, in terms of how
tough it is to compete. And then we you know,
today we're going to talk about pot cafes. You know,
that was a big thing that they're talking about. All these
(04:14):
pot cafes are coming, and the delivery services are coming.
Speaker 3 (04:18):
Maybe not folks.
Speaker 2 (04:19):
Yeah, I don't know if you thought this, but it
just feels like to me as you listen to him talk,
there was a lot of promises up front and a
lot of promises that have not come through for these
business owners. Now maybe that's the result of interest by
the public, you know, and not being as strong as
what they had anticipated, or the regulations being really, really tough.
Speaker 4 (04:42):
And we're going to close the show today with a
survey from k p MG and we're going to be
talking with the managing partner for New England, John Capone.
And basically the survey caught my attention because it paints
a rather rosy picture of Boston and a here's this
climate as we moved through twenty twenty five. All right, Kim,
(05:04):
We've been talking about this now for a couple of weeks,
and we're lucky enough to be joined by the reporter
that really broke this story wide open. He's Ben Simino.
He's an anchor reporter. He's an award winning veteran journalist.
Of course, he works at Channel five WCVB News Center five.
He's the anchor at four PM, five PM, and five thirty,
and he leads the station's nationally recognized consumer reporting franchise,
(05:29):
Ben has your Back.
Speaker 3 (05:30):
Right.
Speaker 4 (05:31):
So there I am sitting on the couch Kim, and
I saw this report Ben has your Back, and I'm like, Wow,
that's that got I don't usually get up and rewind,
but I got up and I rewound this story and
listened to it a couple of times, and since then
it has just, you know, really taken over the headlines,
and the Governor's now making it a mainstay. The utilities
(05:52):
are scrambling to try to figure out what to do
here and offering different discounts. Let's bring in Ben Semino
right now. Ben, thank you for joining us. Hey, look
at I assume you're at work at Channel five one
day and all of a sudden, Ben has your Back.
Speaker 3 (06:07):
You get an email.
Speaker 6 (06:08):
Is this how this started, Yeah, Hey, Joe and Kim,
happy to be here, Thanks for having me.
Speaker 7 (06:12):
Yes.
Speaker 6 (06:12):
So, we get a lot of emails from viewers, and
I'll be honest, most of my story ideas come directly
from viewers. It's critical that they reach out because they're
the ones that are experiencing things. And usually I can
get a pretty good sense. If I get two emails
on a topic, I think it's a story right away,
because that means two people have taken time out of
their day to reach out. If I get more than two,
(06:36):
I think there's even something bigger going on here.
Speaker 7 (06:38):
And I would say probably.
Speaker 6 (06:40):
From about mid January on, I started to get an
email here, an email there, people saying, can you take
a look at these gas bills? Because my delivery fees
are through the roof. So in other words, you know,
a gas bill is split in half. It's half a
supply and half as delivery. There's two main buckets of charges.
It used to be each charge with about fifty percent
(07:03):
of the bill, maybe fifty five to forty five, depending
on what the price of natural gas was at the time.
Well that has changed and now people.
Speaker 7 (07:10):
Are getting these bills where they might only.
Speaker 6 (07:11):
Be using one hundred and fifty or one hundred and
seventy five dollars worth of gas, and then their delivery
charges are four or five, even six hundred dollars on
top of that.
Speaker 7 (07:21):
So I took a look at my own gas bill.
Speaker 6 (07:22):
I have natural gas in my house, and I was like, oh, yeah,
I'm seeing that too. So the email started coming and
I would get one, and then i'd get two, and
then I think once everybody got their bills for January,
which we know January was exceptionally cold this year, people
went through the roof pun intended. I guess they were
getting these bills that were five, six, eight hundred dollars
(07:45):
for not very big houses, utility bills they had never
seen before. So I had gotten maybe two dozen emails,
and I thought, yet, there's definitely a story here. We
got to dig into this.
Speaker 2 (07:54):
So when you started to dig into it, you found
out that number one, you know, and then maybe this
is something you already knew, but you know, back in November,
some of this rate hike was actually approved.
Speaker 7 (08:06):
Yes, that's correct.
Speaker 6 (08:07):
So every twice a year, November first and May first,
two six month increments. November to April thirtieth is considered
the peak winter heating season in Massachusetts, so the gas
utilities are allowed to set rates for that six month
period together, and then there's another rate period from May
one to October thirty one. That's the summer season essentially,
(08:31):
when gas bills are much lower. So yeah, and there
was some coverage around these rate increases when they were
approved by the state Department of Public Utilities, which is
the process, back in late October before they took effect
in November. But I don't think there was any awareness
or public education about what these rate increases would actually
(08:54):
do to gas bills if we had a cold winter,
which we know is what happened. We were fortunate at
the last two winters rates have been creeping up. This
was not a one time thing with these rates that
went into effect in November. Our analysis showed that over
the last two years, just since January of twenty three,
which is when the Healy administration took office, rates across
(09:17):
the board are up anywhere from thirty to almost forty
percent for natural gas, So this has been steadily climbing higher.
There's some reasons behind that, which we can get into,
but there was not a lot of public awareness about
what the two impacts would be on customer built if
the winter turned cold.
Speaker 4 (09:32):
Yeah, we're talking with Ben Semino. He's an ac A
reporter with Channel five and broke this whole natural gas story,
which is splashed wide open here in terms of headlines. Okay,
but Ben, okay, So you do this, and the utilities
are obviously embarrassed. They're already they're pedaling backwards at this point.
First you did a story, and first I heard that
utilities were promising a five percent cut, and now I'm
hearing it's actually a ten percent cut, but it's not
(09:54):
really a cut.
Speaker 6 (09:55):
So take us through that cut, right, Yeah, so this
is just a rate deferral. We've initially reported our first
story back on Thursday, February thirteenth, and that was when
the avalanche kind of opened. I received hundreds of emails
from viewers saying, I'm experiencing the same thing. I can't
pay these bills. What's going on here?
Speaker 7 (10:16):
And so.
Speaker 6 (10:18):
State lawmakers, who have also been hearing it from their constituents,
they got together and the next day, the fourteenth, Valentine's Day,
eighty of them, which is more than a third of
the legislators, sent a letter to the DPU saying you
got to do something about this and so, and then
that was followed two days later on Sunday by the
governor joining kind of this bandwagon and saying, you know,
(10:41):
to the DPU, you have to take action now, the governor.
There's three commissioners that run the state Department of Public Utilities,
the governor, they kind of have rotating terms. This governor, though,
has appointed two of those three, so she certainly does
have sway over what happened to DPU, even though officially
they'll tell you DPU is a quad independent agency.
Speaker 7 (11:02):
So what's going on with this cut is.
Speaker 3 (11:03):
I saw you by the way I saw you at
the press conversation. He's like, I don't think so well.
Speaker 7 (11:11):
So there's a lot of factors that's going into this.
Let me cover this rate deferral for a second.
Speaker 6 (11:15):
So DPU what they came up with is they said
to the gas companies, listen, we can't go backwards right now.
There could be potential retroactive things.
Speaker 7 (11:23):
Coming down the road.
Speaker 6 (11:24):
But what we want you to do is try to
find a way to cut rates. In March and April,
which is the last two months of the winter heating season.
I mean, April is very much on the bubble here right,
because it can be warm in April, it can still
be cold, but at least in.
Speaker 7 (11:38):
March hopefully people would get some relief. The thing is, though,
because DPU.
Speaker 6 (11:42):
Approved these rates, they can't just tell the utilities, we're
going to take that back, so they have to allow
the utilities to get that money back. So the solution
was the utilities can recover the money over the summer
period when gas bills are much lower. I don't know
about you guys. My gas bill drops to like thirty
or thirty five bucks in the summer, So they thought
attack on another five percent or fifteen bucks a month.
(12:03):
No one's going to, you know, have much outcry. Over
six months, we can get the money back. National Grid
DPU said that you can charge interest. The only company
so far that I've seen is doing that is National Grid.
They're going to charge about four and thirty percent interest
to recover the money.
Speaker 3 (12:18):
The night.
Speaker 8 (12:21):
Well, their their.
Speaker 6 (12:23):
Argument is there by far the biggest gas utility in
the state, and so this is going to this rate deferral.
It's going to cost them sixty million dollars, which they
have to go out and borrow. Ever, source is the
second biggest. They're about half that amount. So National Grid says,
it's going to cost us money to do this, so
we have to try to recoup some of that. But yes,
people are not happy about this either, because it's just
(12:44):
it's a it's a band aid at best, and so
it doesn't really get to the root of the problem.
Speaker 2 (12:49):
So Ben, let's look at it now from the company's
point of view. Their complaint, my understanding is that they
are paying into a state program and that's where they
are getting caught.
Speaker 6 (13:01):
Yeah, so you're talking about the mass Save programs, so
that is certainly one of the big factors here. So
this all goes back if we can rewind the clock
to the Deval Patrick administration. Two thousand and eight, the
state legislature passed two pretty landmark climate builds. The Green
Communities Act, which established MASSA to try to help people
weather rise and make their homes more energy efficient, and
(13:24):
also the Global Warming Solutions.
Speaker 7 (13:26):
Act the GWSA.
Speaker 6 (13:29):
The GWSA is what has required the state to reduce
its greenhouse gas emissions. There were a couple of benchmarks
in there. By twenty twenty, it had to drop by
twenty five percent, and by twenty fifty it had to
drop by eighty percent. We met the threshold in twenty twenty.
We actually had dropped thirty one percent. The problem now
is to get to eighty percent fewer greenhouse gas emissions
(13:52):
by twenty fifty. The hill is getting much steeper, and
we've kind of done all the easy things to cut
greenhouse gas emissions, if you will. So by twenty twenty
five this year we have to hit I believe it's
thirty percent, and then by twenty thirty we have to
let me pull up the numbers here because there's a
couple of various steps here. By twenty thirty we have
(14:16):
to hit fifty percent. So that's from nineteen ninety baseline levels.
So sorry, twenty twenty five is thirty three percent, twenty
fifty is fifty percent. So the hill starts to get
a lot steaper. Now that's where mass save comes into play,
because that was in the Green Communities Act. And what
that is is they initially started to say to people, listen,
you know you have an old oil burner. Let's get
(14:39):
you a new oil burner that's much more efficient. You'll
give you some rebates towards that you have. Maybe you
have an old natural gas furnace, Let's get you a
new natural gas furnace.
Speaker 7 (14:47):
Let's help you.
Speaker 6 (14:48):
Insulate the weather. It's your home. The problem is mass
Save has now pivoted. It's reauthorized by the state every
three years. And what they decided to do three years
ago to meet some of these stricter greenhouse gas goals
is they're moving every They want to move everybody off
of heating with fossil fuels, no oil, no natural gas,
(15:09):
no propain. They want everybody to be on electric heat
because the theory is the only way the state's going
to meet these climate goals is if everyone's on electric heat,
and then our electricity comes from green renewable sources hydro
wind and solar. The issue is with each three year
Massive Plan it gets much more expensive. Twenty two to
(15:31):
twenty four plan was four billion, the plan that's proposed
for twenty five to twenty seven was at five billion.
And the utility stay you're telling us we're going to
meet all these benchmarks, We've got to install I think
at one hundred and twenty thousand homes of heat pumps.
This is very expensive stuff and that's all buried day
lawmakers and their incident wisdom decided to bury it.
Speaker 4 (15:52):
Ben, We're going to leave it to you, pal. I mean,
we're not out of time here, but we'll leave it
to you. We'll let you follow it. And of course
we're talking with them Siminal seven nine and he is
of course a Channel five anchor and reporter and you
can watch him his franchise. Ben has your back as
this story continues to evolve. Thanks for talking with Greg
Ryan of the Boston Business Journal about the changing face
(16:14):
of Kendall Square.
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Speaker 2 (18:38):
Welcome back everyone. Boston Business Journal senior reporter Greg Ryan
joining us now is a cover story this week on
the future of Kendall Square. Now, Joe, this was a
booming spot for a long time, some of the biggest
names in high tech, some of the biggest names in
pharma all moving in, and suddenly they are all moving
(18:59):
out and winter dropping. Office fronts are empty, and now
Greg has written this piece Kendle Square three point zero,
and Greg, it's good to have you with us. The
question I guess I have is can Kendle Square reinvent itself?
Speaker 3 (19:13):
Now?
Speaker 7 (19:14):
I think it can.
Speaker 5 (19:15):
Yeah, I mean it's really remarkable. You have what many
people would consider some of the most prime commercial real
estate in the country, and lab vacancys are up. Office
vacancies are up. You know, people think the lab ac
and you know that's a temporary thing and so it
will still be a biotech cover of the world. But
the office is is an interesting story. And yeah, I
talked to a lot of people for this story, and
(19:37):
they do think it will come back, just because you
are right next to MIT, you know, one of the
best research universities in the world. So even though a
lot of the tech companies that were gobbling up office
space right before the pandemic, they're not as interested in
office space anymore. You are starting to see some startups
and some you know, some non traditional businesses moving into
that office space because it is right next to that
(19:58):
I see.
Speaker 4 (19:59):
Yeah, we're with Greg Ryan, Senior Report of the Boston
Business Journal. In Greg, I remember when you were a
guest on our program when Kim and I hosted Bloomberg
Based State Business a couple of years ago. Just how
crazy hot Kendall Square was. You mean, you couldn't get
any space in Kendall Square. And now in your story
on the BBJ today, it says in twenty eighteen, East
Cambridge's office vacancy was one percent Okay, today it's twenty
(20:23):
six percent you report, and rents are down fourteen percent?
Are rents still going down?
Speaker 5 (20:30):
They are still going down? Yeah. And I spoke to
John Davis, the Boston developer who owns, who owns an
office building in Kendall, and he was saying, you know,
it's an older office building, and he was saying, where
we used to get you know, seventy eighty ninety dollars
a square foot, now we're doing like high forties, low fifties.
So it's gone down a lot. But you know, in
(20:51):
that building in particular, it is starting to fill up
because they're getting these sorts of businesses that have been
priced out of Kendall. You know, right before the pandemic
is one of the more interesting new tenants is and
actually a sperm bank, who you know, was I think
in Central Square or something before the pandemic. But once
this space opened up, once the rents got more affordable,
(21:12):
like you can see where a business like that might
want to be right next to MT.
Speaker 2 (21:16):
Let's talk about why this happened first off, I mean,
is it is it just because the kinds of businesses
that existed there have not gone back to work? Meaning
back to the office.
Speaker 5 (21:27):
Yeah, that's that's a huge So it's just.
Speaker 2 (21:29):
The nature is the nature of those businesses.
Speaker 5 (21:31):
Yeah, yeah, it's a very tech heavy market. You know,
for all the problems that downtown Boston has, at least
they have a variety of tenants of businesses down there.
You know, you do see law firms and accounting firms,
they can do space. Tech firms have really embraced remote work.
Speaker 7 (21:46):
Hybrid work.
Speaker 5 (21:47):
So there's just not that interest level right now. But
there are other kinds of companies, you know, like a
like a clean tech that you know, does seem to
be in you know, together as in a physical space
more often than a traditional office kind of you know
AI companies, these AI startups, they seem to be more
interested in being together in person than some other types
(22:09):
of software companies. So there are some tech companies that
are are interested in space, but on the whole that
you know, they really have embraced.
Speaker 7 (22:16):
The remote work.
Speaker 4 (22:18):
With Senior reporter Greg Ryan or the BBJ, I guess
I always wonder when we do stories like this, and
obviously when I see a headline of the BBJ, I
think that you guys are at an inflection point when
you when you write the story, or is Kendall square
at an inflection point? I mean, where are they on
the curve? Things still going bad to worse there? Or
is it your sense because it's changing itself, you know,
(22:39):
it's flattened out and we're coming back.
Speaker 5 (22:41):
Yeah, I think we could be near the sort of
the bottom of the cycle here. I don't know if
we're if we're at the bottom and coming up, or
we will soon hit the bottom. You know, you are
seeing some distress in the market. I wrote in the
story about how one owner had to hand the keys
over to their lender last year because you know, the
situation was bad enough. There's another office building on the
(23:04):
on the market now in Kendall that is expected to
the sell or, you know, a lot less than a
last old for in twenty nineteen. So but when these
when these sales happen, when these transactions happen, it resets
resets the floor for office prices in that way. And
that's that's what you need to see happen for these
buildings to begin falling up, to begin filling up again.
(23:26):
It's rents to come down, and then office tendants to
take those lower rents and to start filling the buildings.
Speaker 2 (23:33):
So what do they anticipate it's going to look like.
I mean, it was obviously this big high tech place.
What's it going to look like when when it's all
said and done, or what do they hope it's going
to look like?
Speaker 5 (23:42):
Yeah, I think you know, on the margins, maybe on
the outskirts of the neighborhood, you could see businesses like
you know, like therapist office or physical therapy, those sorts
of service oriented businesses.
Speaker 7 (23:52):
You could see those go in.
Speaker 5 (23:54):
But I think a lot of it will be driven
by the innovation coming out of MP. You know, I
mentioned clean tech, I mentioned I think even some of
the software startups. You know, maybe they are remote, maybe
they're only coming in a few days a week. But
whereas again when vacancy was one percent, those are the
companies that had to come to downtown Boston. The startups
that are being for now out of MIT, there's space
(24:15):
for them in Kendall, So it's more like they they'll
stay in Kendall in the years ahead.
Speaker 2 (24:19):
All right, Greg, Ryan, we thank you so much for
an update on Kendall Square. Is it rebuilds?
Speaker 5 (24:25):
All right?
Speaker 2 (24:25):
Still come in your way? Have you been sampling some
of your favorite restaurants during Dine Out Week in Boston. Well,
if not, you're going to still have some time, because
it's a full three weeks this year, so you've got
another week. We're going to be joined by a chef
owner to find out exactly what the impact is on
his business. When we come back here on the New
England Business Report, Kim and Joe.
Speaker 1 (24:50):
Will explore more business news that impacts our New England
economy when they return.
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Speaker 2 (25:49):
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That sounds great, But what about the cost, Bill, Because
things have been pretty tight for people.
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Tech Corp. Dot biz for a free estimate. Hi everybody,
(26:58):
I'm Kim Kerrigan.
Speaker 4 (26:59):
And I'm Joe short Sleep. If you want to be
part of the New England Business Report, sponsorships are still available.
Speaker 2 (27:06):
You can email us at Any Business Radio at gmail
dot com.
Speaker 4 (27:10):
That's Any Business Radio all one word at gmail dot
com and we'll get your business on the show too.
And welcome back to the New England Business Report on
this Sunday morning, March the second. This is the spot
in the program where we take a look at other
(27:31):
headlines that are making news. And you know, Kim, this
next one that we're going to talk about a little bit.
This is something that Jim Rooney, the President and CEO
of the Greater Boston Chamber of Commerce, brought up when
you and I were hosting Bloomberg based Day Business in
twenty twenty three, and we're talking about business owners in
downtown Boston and how safe they feel. And now The
Globe is doing in depth reporting on this. The reporter
(27:53):
Maren Halpin and the headline in the most recent article
quote nobody helps Downtown Boston businesses. Safety is a pressing
concern Opposite the Boston Common Storefront support ramp and drug usage,
property damage, and customer intimidation, all of which they say
drives businesses away. And as you know, Kim, they were
(28:16):
meeting with city leaders the last Thursday on this topic.
But this isn't going away.
Speaker 2 (28:22):
No, it's not. And this all started after the pandemic,
when so many businesses moved out and there weren't nearly
as many people downtown. And while people continue to come back,
it seems that some of the issues going on are
not being resolved, so it can be a very scary
place in some of those business locations.
Speaker 4 (28:41):
Yeah, I mean taking a look directly at the Globe
article again, it was written by Marin Holpen. She talks
about the Black Seed Hilla Grill. It sits on Tremont
Street facing the Common a setting that should be considered
prime and draw plenty of customers. But every day though
crowds gather outside to do drugs, people end up fighting,
and the owner says it makes diners feel uncomfortable and
(29:01):
hesitant to enter the eatery. So obviously they're upset and
they do have the city's ear at this point.
Speaker 2 (29:07):
Well down at Boston is back and it is bigger
and better than ever. Joe usually you know, it's two
weeks this year it is three. We're right in the
middle of it, and we wanted to try to find
out a little bit more from some of the restaurant
owners and chefs. Sure why this is such a good
experience for them, because they seem to be coming back
(29:28):
here after.
Speaker 3 (29:29):
Year bigger and bigger.
Speaker 2 (29:31):
I know it. So we are joined by Will Gilson.
He is the owner of a number of restaurants including
the Lexington, Geppeto and Puritan in Company, and of course
he also owns Puritan Oyster Bar. All of those restaurants
over in Cambridge, all participating in Dine Out this year.
Great to have you with us, Will, thank you for
having me absolutely. So let me just pose that question
(29:52):
right to you right now, tell bi us why, and
you've got a number of your restaurants involved, why you've
decided that it's a good thing.
Speaker 5 (29:59):
You know, I think what most people kind of you know,
come to forget because we all get into the winter doldrums,
is that, you know, restaurants, this is probably the quietest
time of year for us, you know, basically, you know,
the two times that Dine Out Boston is happening are
the two times of year when restaurants are always trying
to fill their seats the most, and so you know,
right now is sort of a perfect time. I think,
you know, there's a lot of economic uncertainty out there.
(30:22):
I think a lot of people are trying to get
the best bang for their buck, and so you know,
dine out Boston couldn't come at a better time for
making sure that we're engaging our guests, you know, giving
them an excuse to get out of the house and
come into our places and you know, give them something
to be excited about.
Speaker 4 (30:37):
Give us an idea how different the prices are, I mean,
how much of a discount is it?
Speaker 3 (30:41):
Really?
Speaker 5 (30:42):
You know, it depends on which one of the restaurants
you know that that you're you know, dining at that
is participating. But I would say, you know, kind of
a perfect example is you know, Geppeto are our restaurant
over here in Cambridge Crossing. You know, we have a
three course prefixed menu that is on the menu all
the time and seventy dollars, and the dine out menu,
(31:03):
which is comparable in quality and in portion sizes, is
coming in at fifty five dollars. So you know, it's
basically taking almost twenty you know, percent off of what
the bill would be for you to come in and
be able to enjoy, like I said, the same quality
of food in the same dining room, you know, with
the same level of service. And you know, it's just
a chance for us to be able to use this
as an opportunity to showcase our amazing restaurants to folks
(31:26):
who either have been before and they needed an excuse
to come out, or have never been in before and
this is the perfect reason for them to try it.
Speaker 2 (31:33):
So let me ask you just that are you filling
the seats and are you typically filling them with people
who are newcomers?
Speaker 7 (31:40):
Yeah?
Speaker 5 (31:40):
I mean I think what I always brief the you know,
the restaurant teams for when we're participating in Dine Out
Boston is that we really want when you're coming out
here to you know, when the folks are dining in
our dining room, we want this to be an opportunity
for us to win over new guests. You know, this
isn't just about getting some folks in, making a little
bit of money, the staff making some tips. This is
(32:02):
about us, you know, showcasing our space, making sure that
you know, every single person that dines here is a
new opportunity to make a regular customer at one of
our restaurants. And I think that that's our main goal,
is that this isn't just about might making money. I mean,
obviously that does help, especially at a quiet time of year,
but this is an opportunity for us to make new
fans for all of our restaurants.
Speaker 4 (32:22):
Talking with a chef Will Gilson about dining out, which
is now three weeks, Okay, you get to the March fifteenth.
At the end of the three weeks, you sit down
and you look at the ledger. What success will what's success?
Speaker 5 (32:33):
Well, I mean I think in this sense, you know,
anytime we're bringing in, you know, even fifty percent more
people than we would have had during a normal week
during this time in a sort of year over year,
that's success for us. If every single seat is full,
you know, multiple times a night, then man, that's that's.
Speaker 7 (32:51):
What you could really be asking for.
Speaker 5 (32:53):
I think the thing that's hard is oftentimes diners don't
understand the economics that restaurants face. I mean, you come
and you dish out money for a meal and you're like, wow,
this place must be rolling in it. But it requires
every single person who made a reservation showing up. It
requires making sure that every seat that you have available
gets filled at one point or another, and that you're
able to do it in a way that you know,
controls those costs and actually makes a profit. And so
(33:15):
for us, we sit down and we look at that ledger,
we're hoping to see at least a fifty percent increasing business,
you know, during these three weeks.
Speaker 2 (33:22):
Well, how's business overall? Let's take it out of this
you know, time period. How has business been?
Speaker 5 (33:27):
You know, I can only answer this as somebody who
has most of their restaurants all anchored in Cambridge, and
you know, obviously in Massachusetts. You know, I would say basically,
since election day, we've seen a dramatic pullback in people
showing up for dinner, spending money, throwing private parties. It's
definitely down significantly, you know, year over year. And I
(33:51):
think that that's different for every neighborhood. It's different for
every city in America, I'm sure, But as far as
Cambridge goes, you know, we rely a lot on people
being in biotech, pharma, life sciences, and a lot of
those industries are pulling back as well and doing some restructuring.
So this is an opportunity for us to be able
to make sure that we have those seats available that
(34:15):
we want to give people a reason to come in
and fill them.
Speaker 4 (34:17):
Yeah, how do you explain the drop off? I mean
in your own mind when you sit there, how do
you explain it?
Speaker 5 (34:22):
I mean, do you watch the news and do every
day you not know exactly what's going to happen? I mean,
I think that that's exactly what people are experiencing right now.
I mean every day they wake up and they don't
know if they're going to have a job tomorrow. They
don't know if things are going to cost more tomorrow. Hell,
as a restaurant owner, I don't know if I'm going
to be able to get eggs tomorrow or what their
price is going to be. There's a lot of uncertainty
out there. But the only thing that I can be
(34:43):
certain of is that I know that our places are
filled with amazing staff and that we're serving great food,
and that we want people to be here to be
maybe forgetting about all of that or letting us kind
of inject a little bit of happiness into their.
Speaker 2 (34:55):
Lives, well, well, We certainly hope that Dine Out Boston
is a great success for your restaurants. Again, the Lexington,
Geppeto and Puritan and Company, as well as the Puritan
Oyster Bar will thank you very much for being part
of the show today.
Speaker 4 (35:11):
We want to welcome back to the program this week.
I guess we had on last week a Dave O'Brien,
president and the CEO of the Massachusetts Cannabis Business Association,
and the reason we wanted to have him back is
that there's a lot going on here, folks, and many
of it A lot of it is not very good.
Prices are way down some seventy five percent. Some four
(35:31):
hundred retailers out there are struggling to make a profit,
and it doesn't speak well of well the industry as
a whole here in the state. So Dave, welcome back.
I don't want to be a downer. We can talk
about upsides as well.
Speaker 10 (35:45):
But you'll bring it back up to positivity.
Speaker 7 (35:47):
You don't want right, Go ahead, go ahead.
Speaker 10 (35:51):
I think it's still to your point. When Massachusetts first
legalized this, every state that legalizes said and says, are
we going to be successful at that? In the first
couple of years we were doing over a billion dollars
in sales. I think we're at one point five to
one point six one point seven billion dollars annually in
sales just on the adult use market side now, So
(36:11):
it's no longer theory. It's working right. Customers are going
to stores and buying product. There's lots of choice out
there for types of product, streams of product effects, and
the like. One of the things we're looking at right
now is this many years into the adult use market
and this many more years into the medical market, which
we legalized in twenty twelve. What are some of the
(36:34):
rules that we probably our state probably did a little
too strenuously to begin with. And part of what the
Cannabis Control Commission is considering now is how do they
modernize their regulations And that's something that we're intimately involved
with them on. Did they start off a little too
strenuous when it came to testing limits, when it comes
to product and harmonizing what we do with other states
(37:00):
as regulators, having people not wanting to say we're going
to slash every regulation there is and just let the
market be the market. This is still federally illegal. I
totally understand where the policymakers are coming, but there are
things that can change that will save the industry money.
Some of the fees that they charge are very expensive.
So to have a vertical license costs fifty thousand dollars
(37:23):
a year and you have to renew.
Speaker 7 (37:24):
That every year. That's a big number.
Speaker 10 (37:27):
And once you're up and running, it's sort of maintenance
by the Cannabis Control Commission. So some of those costs
and some of the regulations and rules that the Commission
sort of puts on the industry is something we're looking
very closely, and the Commission's willing to do that.
Speaker 7 (37:42):
So that's been helpful.
Speaker 2 (37:43):
So let's let's get delve into and that's great. That's
great to hear for the industry. Let's delve into some
of the things that you know, Joe and I were
talking about, you know, like some of the cafes and
the deliveries and some of the things that have sort
of tried to, you know, manipulate the business to be
a little more widespread. How are those kinds of things
(38:06):
moving forward and how is that working.
Speaker 10 (38:08):
Yeah, so there's been discussion Kim. When it comes to
the delivery licenses. There are two types of delivery licenses
and massachuest It's one is a courier model, which is
taking the product from a retailer delivering it to a purchaser.
The other is called the delivery operator model, so think
of that as more of a warehouse model, so you
can buy product from the market from cultivators and manufacturers,
(38:31):
put it in your warehouse or depot, and then sell
it and deliver it to people in their homes. The
other thing about the delivery license that is up for
reconsideration is at the beginning of this a few years ago,
the Commission said that delivery license is going to be
set aside for an exclusivity period for social equity and
economic empowerment applicants, which are thick of those as either
(38:55):
people from people that are either individually or their communities
have been harmed by the War on drugs. This is
a bit of a reparative set aside for that license
that is up for renewal to see whether or not
that exclusivity period social equity and economic environment should continue.
We support that, We supported it when the Commission originally
(39:16):
came out in favor of it.
Speaker 4 (39:19):
Dave Obrian's Our Guest he's the president and CEO of
the Massachusetts Cannabis Business Association, and we're talking about well
a number of things going on in the industry. Many
that are these retailers, these so small business owners are
facing many challenges. Where are we in this whole idea
of cafes showing up in communities, cannabis cafes.
Speaker 10 (39:38):
Yeah, this is the last license for the Cannabis Control
Commission to implement, and I think some of the preliminary
regulations that they've put out include single day event licenses,
having a cannabis bar if you will, or cafe.
Speaker 7 (39:56):
I have looked at.
Speaker 10 (39:57):
This over the time. I've been involved in cannabis since sixteen,
and I don't see huge success with it across the country.
It is also a license that is being set aside
for social equity and economic empowerment. It is a capital
intensive if you're going to have a cannabis bar if
(40:17):
you will, because any think of any way that you
would smoke tobacco, which isn't many places you can do
that anymore. You also cannot smoke cannabis flowers. So if
you do that and you have a private club, there's
all sorts of HVAC, so it's very capital intensive to
have a cannabis bar. I think the exciting part is
(40:39):
the one day event licenses, the festival licenses, that sort
of thing. We would just have to see if it's
going to be as fruitful for Massachusetts because other states
have tried. Some have been more successful than others. But
I think the cannabis Control Commissions tried to do their
homework and go out and see, Okay, what can we
build into ours and from the mistakes of other states.
Speaker 2 (41:02):
So Dave, overall, are people still trying to get licenses?
Do they still see it as a business that is
going to be profitable and they want to get into
they are?
Speaker 10 (41:12):
I mean part of it, Kim is. So in the beginning,
a medical license was required to be vertical, so you
had to open up the license that cultivated, manufactured, and
had retail to it. So those early investors in the
medical licenses were had to be very well funded because
it was tens of millions of dollars to build a cultivation,
(41:33):
to build a manufacturing facility, and to open one or
up to three medical retail facilities. I would say the
pace is slowing down. Like I said, we have over
one hundred cultivators. Right now, I think we're almost at
one hundred and forty cultivators, one hundred and twenty manufacturers,
and as I said, close to four hundred retailers. I
(41:56):
think where you're going to see the growth on the
retail side is if communities that were previously banned communities
for retail open up because they see their neighbors making
tax revenue off of a three percent x size tax
that everything sold at the register are at the point
of sale, you know, filling a previously empty storefront, tax
(42:18):
revenue and property helping to increase employment in the community.
So I think communities that were a little skintish in
the past are starting to reconsider that. I don't think
you're going to see a lot of new cultivation and
manufacturing just because it's labor intensive to get it up
and running, it's capital intensive, and it can take a
bit of time. So if you were to start right
(42:40):
now to say I'm going to open up a cultivation
in Massachusetts, it's two to three years old and the
market is very saturated.
Speaker 4 (42:48):
Dave Obrian a final question for me, and I want
to come back at to what you said earlier in
the program. You're talking about a retailer having a license
that needs to be renewed, and the dollar figure you
used was fifty thousand dollars a year.
Speaker 10 (43:01):
Yeah, I want that would be That would be for
the vertical that the license renewal fee. If I'm going
to stop the top of my head, I believe it's
ten thousand dollars. Ten thousand dollars is a lot of money.
Speaker 3 (43:11):
No, it is.
Speaker 4 (43:12):
I'm just wondering, do you have any sort of stats
or as it relates to delinquencies in terms of people
who just flat out aren't paying their their fees anymore.
Speaker 10 (43:22):
Oh, if you don't pay your fees, they shut you down.
It's on an annualized basis. If you're not doing your
renewal with the Cannabis Control Commission and paying your license
and fee, they say, thanks for playing, You're done. The
other thing, Joe, that really has has been something we've
been intimately involved with is the host community agrem We
could do a whole.
Speaker 7 (43:41):
Show on this.
Speaker 10 (43:44):
Where communities basically shake down operators and say you need
to give us an extra three percent for anything that
you might cause us negative impact wise. And you've probably
followed what happened Inhavioral. They had a set at April
m she got seventy percent of her HCA money back.
(44:06):
In Uxbridge, Caroline Frankel at Caroline's Cannabis got one point
one one point two million dollars over HCA back. We
have hold out communities. Newton's holding out and thinking they
don't have to give the money back. They're in court.
Other communities have settled. Pittsfield settled, other communities are settling
as well. Sale and Masses just raised their hands and
(44:27):
said we want to increase the tax on cannabis stores.
So there is no lack of advocacy and fighting that
we have to do on behalf of the industry. But
HTAs is something that is particular. I've called it a
legalized exportion that communities have tried to get away with
the billing the stores and co operators for phantom feed
(44:49):
that santem cost it don't exist.
Speaker 4 (44:52):
Sounds like a good topic for the New England Business Report.
Speaker 3 (44:57):
He's Dave O'Brien.
Speaker 4 (44:58):
He's the CEO of the massive U such Cannabis Business
Association and Kim and I will be following this business
development closely over the coming months.
Speaker 1 (45:13):
You are listening to the New England Business Report on
the Voice of Boston WRKO six' Eighty joe And kim
will be right.
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Speaker 4 (47:27):
Shortsley if you want to be part of The New
England Business, report sponsorships are still.
Speaker 2 (47:33):
Available you can email us At Any Business radio at
gmail dot.
Speaker 4 (47:37):
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dot com and we'll get your business on the show.
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Speaker 4 (48:02):
Com and welcome back to The New England Business. Report
on This March sunday. Morning we're gonna close out the.
Program you. Know you know how in like television, news
they always want to end this news on like a happy.
Speaker 3 (48:19):
Story, well here you go.
Speaker 2 (48:22):
A, kicker we're gonna Get we're gonna kick it.
Speaker 3 (48:24):
Off it's not a, kicker but you know What i'm.
Speaker 4 (48:27):
Saying we're talking about a new survey that caught my,
attention Caught kim's, attention.
Speaker 3 (48:32):
Done BY.
Speaker 4 (48:33):
Kpmg it's a survey Of boston business leaders and it
basically paints a rather rosy picture of what they see
in twenty twenty. Five so let's bring in the managing
partner For boston's office KP, Mg John, capone and he
(48:54):
is the managing partner for. Here he's also his oversight
stretches Throughout New england and Upstate New. York, john thanks
very much for joining, Us, Hi, Joe Like kim tell
us about this new survey Survey boston business, LEADERS i
strategic investments in real estate and talent in twenty twenty
five sounds kind of, rosy you.
Speaker 8 (49:13):
KNOW i like how you tease that, up because even for,
me as A New, ENGLANDER i even thought the responses
were overly optimistic For, bostonians AND i think that's a
good sign of what twenty twenty five might. Have some
of the THINGS i think that are worth talking about
is the optimism that we have in our local economy
(49:36):
and certainly the industries that make up The New england.
Marketplace there's certainly strength in, healthcare life, sciences financial, services
and banking and technology, firms and many of those responded
to our, survey and we're quite optimistic about what the
next twelve to eighteen months holds for.
Speaker 2 (49:55):
Them, well, Obviously, john you've said that this was surprising
even to you who give us an idea of how
this compares to maybe where we were a year.
Speaker 8 (50:05):
Ago it's a notable. Optimism it's a noted. CHANGE i,
think you, know AS i manage our business here and
work with many of our, clients there were certain uncertainties
that sort of permeated the business. Environment it created a
(50:26):
lot of, pause consternation about investing in their, businesses thinking
about the, future making strategic. Investments and it was a
year where a lot has, happened a lot has. Changed
when you think about The JENNY I wave and where
we are right we, can of course cannot forget the presidential.
(50:48):
Election so you had this environment the last twelve months
where there was a lot of factors that impacted how
business leaders thought about how and where we place our
bets and place our.
Speaker 7 (51:02):
Capital SO i.
Speaker 8 (51:04):
Think as you ask, questions and this survey was designed
and it just for some statistics as you as you're
talking to an accountant, here you, know we love our, statistics,
right we spoke to and the response, is you, know
most of the, responses greater than sixty percent came from
some of the largest companies in our. Region so these
(51:24):
would be companies with greater than five hundred million dollars in.
Revenue and when you think about those, responses and most
of the responses came from THE c suite executives OR,
evt eighty percent of the respondents held that. Title when
you get that kind of response where the focus is
now on it's time to rethink how do we improve our,
(51:47):
operations how do we drive more? Efficiency and we look
for opportunity in the. Marketplace and THAT i think was
really the takeaway from me out of this.
Speaker 4 (51:57):
Survey talking with The John, componies managing partner for a
KP mg here In, Boston New england and Upstate New,
YORK i talk about their, survey you, know Because john
on this program AND i don't want to be labor this,
point but on this particular program, today you, know we've
heard from business leaders who are scared, about you, know
what's going on in their storefronts and Downtown. Boston we've
(52:18):
heard we talked About Kendall square at the vacancy rate
being crazy at this, point up around twenty five. Percent
we heard from a restaurant chef who is saying, that you,
know dine Out boston now that they're very scared because
business is really bad at this. Point SO i GUESS
i come back and you're talking about CEOs and THE c?
Suite are are they out of touch or is somebody
(52:38):
missing the beat?
Speaker 5 (52:39):
Here?
Speaker 8 (52:40):
Yes, well let me let me maybe quantify this a little.
Bit so some of the respondents right when you ask
questions about how how how does business? Grow, right and
it starts with having great? Talent. Right, overwhelmingly we're very
lucky to be an environment and in a location where
(53:00):
The New england business can draw from some of the
world class institutions from this. Region and so you start
at a situation where you, say bringing talent and attracting
talent to companies that are interested in. Growing we still
are in a very enviable situation and position compared to
lots of other. Cities you raise questions and observations about
(53:24):
returning to. Work being In Boston Kendall square lab, space
which is sort of the acronym when you think about
synonymous with The Kendall square vacancy. Rates we're going to
continue to see companies go down the path in these critical.
Industries but the return to WORK i think is also
(53:45):
an element. Here, Right how do you keep and attract
talent for companies to thrive and return to work is
certainly a piece of. That and what you highlight is
the fact that most companies are, effectively including, ers using
a hybrid model where you want your employees in you,
know three sometimes four days a. Week but it's not
(54:09):
back to PRE covid when we were all in five
days a week and you had city foot traffic in
the cities like we used to.
Speaker 2 (54:16):
Have, So, john what does this optimism look like over
the course of twenty twenty.
Speaker 8 (54:21):
FIVE i think you know HOW i read this and
WHAT i pull out of. It, certainly there was an
element in the survey about embracing new, technology AND i
THINK i think a lot of the direction that we're
headed is we can gain efficiencies by using some of these.
TOOLS i think it can make the workforce more. PRODUCTIVE
(54:43):
i think it can improve the, climate the work, climate
and folks enjoying more of their business because some of
these tools will help us be more. Efficient SO i
think that was an element THAT i THINK i took
away from. It the other element was the number of
the number of companies and executives that, said, overwhelmingly if
(55:06):
you ask them a very generic, question do you think
in twelve months you'll have a larger workforce.
Speaker 7 (55:12):
Or a smaller?
Speaker 8 (55:13):
Workforce and with that, question you, know an overwhelming majority
said we expect to have a larger. Workforce and that
was probably the big takeaway for me is the optimism
is all around plans to.
Speaker 4 (55:29):
Grow John compone's our guest managing partner OF. Kpmg let's
talk a little bit about remote. Work where are companies
on remote? Work where are they on back to the
office at this? Point and there's also another thing in
your survey here talking about how many of them are
open to a thirty two hour work week.
Speaker 8 (55:46):
THAT i think has been talked about for some. Time
how do you make the work life balance better and
a two hour work week that you talk about in
person with one day. Remote for, us we think that
the hybrid model is working. Well we think there's a
huge benefit of being. TOGETHER i think that's what you're.
(56:07):
Hearing but there is a recognition that people can still
be productive and work from home without that long, commute
and certainly being in this, area we know what that
is all about on A tuesday Through. Thursday SO i
think that's a trend we might hear more about as
we go through this, year for, us our experiences bringing
(56:29):
folks in three or four days a, week teaching them
to learn our business and then sort of an apprenticeship
model is paying. DIVIDENDS i don't think that's going to,
change all.
Speaker 4 (56:39):
Right, So, john as we close out this conversation, here
what's the one thing you're most proud of is you
look towards twenty twenty.
Speaker 8 (56:46):
FIVE i think this renewed sense of optimism that better
days are ahead will put capital to. Work businesses will
and that'll help Our New england.
Speaker 4 (56:55):
Economy oh He's John capone and he's the managing partner
OF kp and here In, Boston New england and Upstate New.
Speaker 3 (57:03):
York and you know what going to close out This
sunday morning on an up, Note, Kim, YEAH i like.
Speaker 2 (57:08):
It, well that's going to do With joe for this
edition of The New England Business. Reports So i'm glad
everybody could be with us This, sunday AND i hope
you can join again Next sunday when we are talking
to the head of one of the Downtown boston residential.
Associations you Heard joe earlier in the show talking about
the fact that folks and businesses and residents are a
(57:29):
little concerned about safety in Downtown. Boston, well his organization
is taking this to the city and we're going to
talk to him about the impact on residents and on
businesses in downtown as the security issue continues to. Loom
in the, meantime we hope you have a great, week.
Everybody I'm Kim carrigan along With joe Short sleep here
on The New England Business report ON, Wrko The voice
(57:52):
Of BOSTON am six eighty
This is the New England Business Report with Joe short
Sleeve and Kim Carragan, a weekly roundup and discussion of
the top business news impacting our New England economy.
Speaker 2 (00:09):
Good morning, everybody, and welcome to the New England Business
Report on this Sunday morning. It is March, the second
Joe Shorts Cagan with you. Yes, the first Sunday in March.
Speaker 3 (00:20):
Yeah, I know.
Speaker 4 (00:21):
And here we march into year two of the New
England Business Report, and it's getting warmer out there.
Speaker 3 (00:25):
Kim, right, you're not. You're doing okay?
Speaker 2 (00:28):
You know, it's it's better. It's all relative, I guess, Joe, right,
it certainly is. Well this time next week we will
have gotten rid of daylight savings time. Think about that,
and we will be springing forward. So I like that
because it's obviously later in the evenings, but I don't
love it because I'm a morning person. So it gets
(00:48):
darker again in the mornings for a little while.
Speaker 4 (00:50):
Yeah, for a little while, but demonstraten itselfs out, you know, it.
Speaker 2 (00:53):
Does, and then we start just marching literally into real spring,
and I can't wait.
Speaker 4 (00:59):
Mark, Mark, just a tough one one though. March is
a tough one. You know, I couldn't agree with you more.
I always think that it's going to be warmer than
it is or prettier than it is.
Speaker 2 (01:06):
I couldn't agree with you more. I think I personally
think that March is the toughest month because you have
such anticipation, but it usually lets you down. And let's
take a look at the show today. We've got a
good one coming your way, everybody. First off, up, WCVB
news anchor Ben Simono is going to join us. Ben
has been the reporter on this incredible gas rate hike story.
(01:29):
He has been out there, you know, really pushing the
administration as well as some of these company leaders. He
was the guy I think that people started reaching out
to when they started getting these astronomical bills to begin with,
and sort of brought it to the the you know,
the forefront.
Speaker 3 (01:45):
So everybody jumped on it everywhere. It's a huge story.
Speaker 4 (01:48):
The Governor's now making it the mainstay for talking about
new legislation, and you know John chest with the globes
righting about it. I mean he really touched an nerve.
Speaker 2 (01:57):
Well, these gas rate hikes really touched a nerve. I mean,
you know, these people who are getting bills that are
three times what they got a year ago. That is shocking.
And there has been some developments, by the way, and
some of them are good, but some of them maybe
have a catch. So we'll let Ben sort of explain
all of that. I'm Ben Senior reporter for the Boston
(02:17):
Business Journal. Greg Ryan's going to be here. He's going
to talk to us about the future of Kendall Square.
Of course, that was an area where all the big
tech names, all the big pharma names, they were all
moving in there. Then COVID happened, and then a whole
bunch of other things happened, and suddenly they all started
moving out and rents dropped, and the neighborhood has changed
(02:39):
a bit. So some locals are doing their best to
maybe bring it back to its glory.
Speaker 4 (02:44):
Yeah, and Greg is going to walk us through that
Kendall Square a three point oh what will it look like?
Also on the program today, we're going to talk more
a little bit more about dine out Boston. We're going
to be talking with world renowned chef Will Gilson. Of course,
has a number of restaurants in Cambridge, the Lexington Cafe,
Beatrice Carpeto, Puritan and Company anyway. But it's all about
(03:07):
dine out. It's now a you know, you get a
discounted meal, so to speak. I guess it used to
be a week, then it was two weeks. This year
it's three weeks. So we'll talk to him about how
that works. And you know, is it drawing in the
you know, new customers.
Speaker 2 (03:21):
I have to assume that if you got involved in
you as a business owner and you knew that it
was three weeks, it must have been positive for you
in the past, right.
Speaker 3 (03:29):
Right, because I can't imagine.
Speaker 5 (03:30):
You know.
Speaker 4 (03:30):
We were had Martha Sherit and the president of Meet
Boston on this program last week and she says, you know,
they're reaching out, but all these restaurants are saying yes,
you know, we may have two hundred restaurants or something. Yes, yeah, okay.
Also part two of our conversation with a. Dave O'Brien,
CEO of the Mass Cannabis Business Association. Kim and I
were a little taken back by what he had to
say in his first visit last week. That's why we
(03:53):
have scheduled another conversation with him today. Talked about the
health of the state's pot industry, and things do not
sound well there in terms of what's going on in
terms of the price of pot, in terms of how
tough it is to compete. And then we you know,
today we're going to talk about pot cafes. You know,
that was a big thing that they're talking about. All these
(04:14):
pot cafes are coming, and the delivery services are coming.
Speaker 3 (04:18):
Maybe not folks.
Speaker 2 (04:19):
Yeah, I don't know if you thought this, but it
just feels like to me as you listen to him talk,
there was a lot of promises up front and a
lot of promises that have not come through for these
business owners. Now maybe that's the result of interest by
the public, you know, and not being as strong as
what they had anticipated, or the regulations being really, really tough.
Speaker 4 (04:42):
And we're going to close the show today with a
survey from k p MG and we're going to be
talking with the managing partner for New England, John Capone.
And basically the survey caught my attention because it paints
a rather rosy picture of Boston and a here's this
climate as we moved through twenty twenty five. All right, Kim,
(05:04):
We've been talking about this now for a couple of weeks,
and we're lucky enough to be joined by the reporter
that really broke this story wide open. He's Ben Simino.
He's an anchor reporter. He's an award winning veteran journalist.
Of course, he works at Channel five WCVB News Center five.
He's the anchor at four PM, five PM, and five thirty,
and he leads the station's nationally recognized consumer reporting franchise,
(05:29):
Ben has your Back.
Speaker 3 (05:30):
Right.
Speaker 4 (05:31):
So there I am sitting on the couch Kim, and
I saw this report Ben has your Back, and I'm like, Wow,
that's that got I don't usually get up and rewind,
but I got up and I rewound this story and
listened to it a couple of times, and since then
it has just, you know, really taken over the headlines,
and the Governor's now making it a mainstay. The utilities
(05:52):
are scrambling to try to figure out what to do
here and offering different discounts. Let's bring in Ben Semino
right now. Ben, thank you for joining us. Hey, look
at I assume you're at work at Channel five one
day and all of a sudden, Ben has your Back.
Speaker 3 (06:07):
You get an email.
Speaker 6 (06:08):
Is this how this started, Yeah, Hey, Joe and Kim,
happy to be here, Thanks for having me.
Speaker 7 (06:12):
Yes.
Speaker 6 (06:12):
So, we get a lot of emails from viewers, and
I'll be honest, most of my story ideas come directly
from viewers. It's critical that they reach out because they're
the ones that are experiencing things. And usually I can
get a pretty good sense. If I get two emails
on a topic, I think it's a story right away,
because that means two people have taken time out of
their day to reach out. If I get more than two,
(06:36):
I think there's even something bigger going on here.
Speaker 7 (06:38):
And I would say probably.
Speaker 6 (06:40):
From about mid January on, I started to get an
email here, an email there, people saying, can you take
a look at these gas bills? Because my delivery fees
are through the roof. So in other words, you know,
a gas bill is split in half. It's half a
supply and half as delivery. There's two main buckets of charges.
It used to be each charge with about fifty percent
(07:03):
of the bill, maybe fifty five to forty five, depending
on what the price of natural gas was at the time.
Well that has changed and now people.
Speaker 7 (07:10):
Are getting these bills where they might only.
Speaker 6 (07:11):
Be using one hundred and fifty or one hundred and
seventy five dollars worth of gas, and then their delivery
charges are four or five, even six hundred dollars on
top of that.
Speaker 7 (07:21):
So I took a look at my own gas bill.
Speaker 6 (07:22):
I have natural gas in my house, and I was like, oh, yeah,
I'm seeing that too. So the email started coming and
I would get one, and then i'd get two, and
then I think once everybody got their bills for January,
which we know January was exceptionally cold this year, people
went through the roof pun intended. I guess they were
getting these bills that were five, six, eight hundred dollars
(07:45):
for not very big houses, utility bills they had never
seen before. So I had gotten maybe two dozen emails,
and I thought, yet, there's definitely a story here. We
got to dig into this.
Speaker 2 (07:54):
So when you started to dig into it, you found
out that number one, you know, and then maybe this
is something you already knew, but you know, back in November,
some of this rate hike was actually approved.
Speaker 7 (08:06):
Yes, that's correct.
Speaker 6 (08:07):
So every twice a year, November first and May first,
two six month increments. November to April thirtieth is considered
the peak winter heating season in Massachusetts, so the gas
utilities are allowed to set rates for that six month
period together, and then there's another rate period from May
one to October thirty one. That's the summer season essentially,
(08:31):
when gas bills are much lower. So yeah, and there
was some coverage around these rate increases when they were
approved by the state Department of Public Utilities, which is
the process, back in late October before they took effect
in November. But I don't think there was any awareness
or public education about what these rate increases would actually
(08:54):
do to gas bills if we had a cold winter,
which we know is what happened. We were fortunate at
the last two winters rates have been creeping up. This
was not a one time thing with these rates that
went into effect in November. Our analysis showed that over
the last two years, just since January of twenty three,
which is when the Healy administration took office, rates across
(09:17):
the board are up anywhere from thirty to almost forty
percent for natural gas, So this has been steadily climbing higher.
There's some reasons behind that, which we can get into,
but there was not a lot of public awareness about
what the two impacts would be on customer built if
the winter turned cold.
Speaker 4 (09:32):
Yeah, we're talking with Ben Semino. He's an ac A
reporter with Channel five and broke this whole natural gas story,
which is splashed wide open here in terms of headlines. Okay,
but Ben, okay, So you do this, and the utilities
are obviously embarrassed. They're already they're pedaling backwards at this point.
First you did a story, and first I heard that
utilities were promising a five percent cut, and now I'm
hearing it's actually a ten percent cut, but it's not
(09:54):
really a cut.
Speaker 6 (09:55):
So take us through that cut, right, Yeah, so this
is just a rate deferral. We've initially reported our first
story back on Thursday, February thirteenth, and that was when
the avalanche kind of opened. I received hundreds of emails
from viewers saying, I'm experiencing the same thing. I can't
pay these bills. What's going on here?
Speaker 7 (10:16):
And so.
Speaker 6 (10:18):
State lawmakers, who have also been hearing it from their constituents,
they got together and the next day, the fourteenth, Valentine's Day,
eighty of them, which is more than a third of
the legislators, sent a letter to the DPU saying you
got to do something about this and so, and then
that was followed two days later on Sunday by the
governor joining kind of this bandwagon and saying, you know,
(10:41):
to the DPU, you have to take action now, the governor.
There's three commissioners that run the state Department of Public Utilities,
the governor, they kind of have rotating terms. This governor, though,
has appointed two of those three, so she certainly does
have sway over what happened to DPU, even though officially
they'll tell you DPU is a quad independent agency.
Speaker 7 (11:02):
So what's going on with this cut is.
Speaker 3 (11:03):
I saw you by the way I saw you at
the press conversation. He's like, I don't think so well.
Speaker 7 (11:11):
So there's a lot of factors that's going into this.
Let me cover this rate deferral for a second.
Speaker 6 (11:15):
So DPU what they came up with is they said
to the gas companies, listen, we can't go backwards right now.
There could be potential retroactive things.
Speaker 7 (11:23):
Coming down the road.
Speaker 6 (11:24):
But what we want you to do is try to
find a way to cut rates. In March and April,
which is the last two months of the winter heating season.
I mean, April is very much on the bubble here right,
because it can be warm in April, it can still
be cold, but at least in.
Speaker 7 (11:38):
March hopefully people would get some relief. The thing is, though,
because DPU.
Speaker 6 (11:42):
Approved these rates, they can't just tell the utilities, we're
going to take that back, so they have to allow
the utilities to get that money back. So the solution
was the utilities can recover the money over the summer
period when gas bills are much lower. I don't know
about you guys. My gas bill drops to like thirty
or thirty five bucks in the summer, So they thought
attack on another five percent or fifteen bucks a month.
(12:03):
No one's going to, you know, have much outcry. Over
six months, we can get the money back. National Grid
DPU said that you can charge interest. The only company
so far that I've seen is doing that is National Grid.
They're going to charge about four and thirty percent interest
to recover the money.
Speaker 3 (12:18):
The night.
Speaker 8 (12:21):
Well, their their.
Speaker 6 (12:23):
Argument is there by far the biggest gas utility in
the state, and so this is going to this rate deferral.
It's going to cost them sixty million dollars, which they
have to go out and borrow. Ever, source is the
second biggest. They're about half that amount. So National Grid says,
it's going to cost us money to do this, so
we have to try to recoup some of that. But yes,
people are not happy about this either, because it's just
(12:44):
it's a it's a band aid at best, and so
it doesn't really get to the root of the problem.
Speaker 2 (12:49):
So Ben, let's look at it now from the company's
point of view. Their complaint, my understanding is that they
are paying into a state program and that's where they
are getting caught.
Speaker 6 (13:01):
Yeah, so you're talking about the mass Save programs, so
that is certainly one of the big factors here. So
this all goes back if we can rewind the clock
to the Deval Patrick administration. Two thousand and eight, the
state legislature passed two pretty landmark climate builds. The Green
Communities Act, which established MASSA to try to help people
weather rise and make their homes more energy efficient, and
(13:24):
also the Global Warming Solutions.
Speaker 7 (13:26):
Act the GWSA.
Speaker 6 (13:29):
The GWSA is what has required the state to reduce
its greenhouse gas emissions. There were a couple of benchmarks
in there. By twenty twenty, it had to drop by
twenty five percent, and by twenty fifty it had to
drop by eighty percent. We met the threshold in twenty twenty.
We actually had dropped thirty one percent. The problem now
is to get to eighty percent fewer greenhouse gas emissions
(13:52):
by twenty fifty. The hill is getting much steeper, and
we've kind of done all the easy things to cut
greenhouse gas emissions, if you will. So by twenty twenty
five this year we have to hit I believe it's
thirty percent, and then by twenty thirty we have to
let me pull up the numbers here because there's a
couple of various steps here. By twenty thirty we have
(14:16):
to hit fifty percent. So that's from nineteen ninety baseline levels.
So sorry, twenty twenty five is thirty three percent, twenty
fifty is fifty percent. So the hill starts to get
a lot steaper. Now that's where mass save comes into play,
because that was in the Green Communities Act. And what
that is is they initially started to say to people, listen,
you know you have an old oil burner. Let's get
(14:39):
you a new oil burner that's much more efficient. You'll
give you some rebates towards that you have. Maybe you
have an old natural gas furnace, Let's get you a
new natural gas furnace.
Speaker 7 (14:47):
Let's help you.
Speaker 6 (14:48):
Insulate the weather. It's your home. The problem is mass
Save has now pivoted. It's reauthorized by the state every
three years. And what they decided to do three years
ago to meet some of these stricter greenhouse gas goals
is they're moving every They want to move everybody off
of heating with fossil fuels, no oil, no natural gas,
(15:09):
no propain. They want everybody to be on electric heat
because the theory is the only way the state's going
to meet these climate goals is if everyone's on electric heat,
and then our electricity comes from green renewable sources hydro
wind and solar. The issue is with each three year
Massive Plan it gets much more expensive. Twenty two to
(15:31):
twenty four plan was four billion, the plan that's proposed
for twenty five to twenty seven was at five billion.
And the utility stay you're telling us we're going to
meet all these benchmarks, We've got to install I think
at one hundred and twenty thousand homes of heat pumps.
This is very expensive stuff and that's all buried day
lawmakers and their incident wisdom decided to bury it.
Speaker 4 (15:52):
Ben, We're going to leave it to you, pal. I mean,
we're not out of time here, but we'll leave it
to you. We'll let you follow it. And of course
we're talking with them Siminal seven nine and he is
of course a Channel five anchor and reporter and you
can watch him his franchise. Ben has your back as
this story continues to evolve. Thanks for talking with Greg
Ryan of the Boston Business Journal about the changing face
(16:14):
of Kendall Square.
Speaker 1 (16:22):
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Speaker 2 (18:38):
Welcome back everyone. Boston Business Journal senior reporter Greg Ryan
joining us now is a cover story this week on
the future of Kendall Square. Now, Joe, this was a
booming spot for a long time, some of the biggest
names in high tech, some of the biggest names in
pharma all moving in, and suddenly they are all moving
(18:59):
out and winter dropping. Office fronts are empty, and now
Greg has written this piece Kendle Square three point zero,
and Greg, it's good to have you with us. The
question I guess I have is can Kendle Square reinvent itself?
Speaker 3 (19:13):
Now?
Speaker 7 (19:14):
I think it can.
Speaker 5 (19:15):
Yeah, I mean it's really remarkable. You have what many
people would consider some of the most prime commercial real
estate in the country, and lab vacancys are up. Office
vacancies are up. You know, people think the lab ac
and you know that's a temporary thing and so it
will still be a biotech cover of the world. But
the office is is an interesting story. And yeah, I
talked to a lot of people for this story, and
(19:37):
they do think it will come back, just because you
are right next to MIT, you know, one of the
best research universities in the world. So even though a
lot of the tech companies that were gobbling up office
space right before the pandemic, they're not as interested in
office space anymore. You are starting to see some startups
and some you know, some non traditional businesses moving into
that office space because it is right next to that
(19:58):
I see.
Speaker 4 (19:59):
Yeah, we're with Greg Ryan, Senior Report of the Boston
Business Journal. In Greg, I remember when you were a
guest on our program when Kim and I hosted Bloomberg
Based State Business a couple of years ago. Just how
crazy hot Kendall Square was. You mean, you couldn't get
any space in Kendall Square. And now in your story
on the BBJ today, it says in twenty eighteen, East
Cambridge's office vacancy was one percent Okay, today it's twenty
(20:23):
six percent you report, and rents are down fourteen percent?
Are rents still going down?
Speaker 5 (20:30):
They are still going down? Yeah. And I spoke to
John Davis, the Boston developer who owns, who owns an
office building in Kendall, and he was saying, you know,
it's an older office building, and he was saying, where
we used to get you know, seventy eighty ninety dollars
a square foot, now we're doing like high forties, low fifties.
So it's gone down a lot. But you know, in
(20:51):
that building in particular, it is starting to fill up
because they're getting these sorts of businesses that have been
priced out of Kendall. You know, right before the pandemic
is one of the more interesting new tenants is and
actually a sperm bank, who you know, was I think
in Central Square or something before the pandemic. But once
this space opened up, once the rents got more affordable,
(21:12):
like you can see where a business like that might
want to be right next to MT.
Speaker 2 (21:16):
Let's talk about why this happened first off, I mean,
is it is it just because the kinds of businesses
that existed there have not gone back to work? Meaning
back to the office.
Speaker 5 (21:27):
Yeah, that's that's a huge So it's just.
Speaker 2 (21:29):
The nature is the nature of those businesses.
Speaker 5 (21:31):
Yeah, yeah, it's a very tech heavy market. You know,
for all the problems that downtown Boston has, at least
they have a variety of tenants of businesses down there.
You know, you do see law firms and accounting firms,
they can do space. Tech firms have really embraced remote work.
Speaker 7 (21:46):
Hybrid work.
Speaker 5 (21:47):
So there's just not that interest level right now. But
there are other kinds of companies, you know, like a
like a clean tech that you know, does seem to
be in you know, together as in a physical space
more often than a traditional office kind of you know
AI companies, these AI startups, they seem to be more
interested in being together in person than some other types
(22:09):
of software companies. So there are some tech companies that
are are interested in space, but on the whole that
you know, they really have embraced.
Speaker 7 (22:16):
The remote work.
Speaker 4 (22:18):
With Senior reporter Greg Ryan or the BBJ, I guess
I always wonder when we do stories like this, and
obviously when I see a headline of the BBJ, I
think that you guys are at an inflection point when
you when you write the story, or is Kendall square
at an inflection point? I mean, where are they on
the curve? Things still going bad to worse there? Or
is it your sense because it's changing itself, you know,
(22:39):
it's flattened out and we're coming back.
Speaker 5 (22:41):
Yeah, I think we could be near the sort of
the bottom of the cycle here. I don't know if
we're if we're at the bottom and coming up, or
we will soon hit the bottom. You know, you are
seeing some distress in the market. I wrote in the
story about how one owner had to hand the keys
over to their lender last year because you know, the
situation was bad enough. There's another office building on the
(23:04):
on the market now in Kendall that is expected to
the sell or, you know, a lot less than a
last old for in twenty nineteen. So but when these
when these sales happen, when these transactions happen, it resets
resets the floor for office prices in that way. And
that's that's what you need to see happen for these
buildings to begin falling up, to begin filling up again.
(23:26):
It's rents to come down, and then office tendants to
take those lower rents and to start filling the buildings.
Speaker 2 (23:33):
So what do they anticipate it's going to look like.
I mean, it was obviously this big high tech place.
What's it going to look like when when it's all
said and done, or what do they hope it's going
to look like?
Speaker 5 (23:42):
Yeah, I think you know, on the margins, maybe on
the outskirts of the neighborhood, you could see businesses like
you know, like therapist office or physical therapy, those sorts
of service oriented businesses.
Speaker 7 (23:52):
You could see those go in.
Speaker 5 (23:54):
But I think a lot of it will be driven
by the innovation coming out of MP. You know, I
mentioned clean tech, I mentioned I think even some of
the software startups. You know, maybe they are remote, maybe
they're only coming in a few days a week. But
whereas again when vacancy was one percent, those are the
companies that had to come to downtown Boston. The startups
that are being for now out of MIT, there's space
(24:15):
for them in Kendall, So it's more like they they'll
stay in Kendall in the years ahead.
Speaker 2 (24:19):
All right, Greg, Ryan, we thank you so much for
an update on Kendall Square. Is it rebuilds?
Speaker 5 (24:25):
All right?
Speaker 2 (24:25):
Still come in your way? Have you been sampling some
of your favorite restaurants during Dine Out Week in Boston. Well,
if not, you're going to still have some time, because
it's a full three weeks this year, so you've got
another week. We're going to be joined by a chef
owner to find out exactly what the impact is on
his business. When we come back here on the New
England Business Report, Kim and Joe.
Speaker 1 (24:50):
Will explore more business news that impacts our New England
economy when they return.
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Chase of high Tech Windows. Now, Bill, we've been hearing
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That sounds great, But what about the cost, Bill, Because
things have been pretty tight for people.
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It sounds terrific. So the best prices and the best
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Tech Corp. Dot biz for a free estimate. Hi everybody,
(26:58):
I'm Kim Kerrigan.
Speaker 4 (26:59):
And I'm Joe short Sleep. If you want to be
part of the New England Business Report, sponsorships are still available.
Speaker 2 (27:06):
You can email us at Any Business Radio at gmail
dot com.
Speaker 4 (27:10):
That's Any Business Radio all one word at gmail dot
com and we'll get your business on the show too.
And welcome back to the New England Business Report on
this Sunday morning, March the second. This is the spot
in the program where we take a look at other
(27:31):
headlines that are making news. And you know, Kim, this
next one that we're going to talk about a little bit.
This is something that Jim Rooney, the President and CEO
of the Greater Boston Chamber of Commerce, brought up when
you and I were hosting Bloomberg based Day Business in
twenty twenty three, and we're talking about business owners in
downtown Boston and how safe they feel. And now The
Globe is doing in depth reporting on this. The reporter
(27:53):
Maren Halpin and the headline in the most recent article
quote nobody helps Downtown Boston businesses. Safety is a pressing
concern Opposite the Boston Common Storefront support ramp and drug usage,
property damage, and customer intimidation, all of which they say
drives businesses away. And as you know, Kim, they were
(28:16):
meeting with city leaders the last Thursday on this topic.
But this isn't going away.
Speaker 2 (28:22):
No, it's not. And this all started after the pandemic,
when so many businesses moved out and there weren't nearly
as many people downtown. And while people continue to come back,
it seems that some of the issues going on are
not being resolved, so it can be a very scary
place in some of those business locations.
Speaker 4 (28:41):
Yeah, I mean taking a look directly at the Globe
article again, it was written by Marin Holpen. She talks
about the Black Seed Hilla Grill. It sits on Tremont
Street facing the Common a setting that should be considered
prime and draw plenty of customers. But every day though
crowds gather outside to do drugs, people end up fighting,
and the owner says it makes diners feel uncomfortable and
(29:01):
hesitant to enter the eatery. So obviously they're upset and
they do have the city's ear at this point.
Speaker 2 (29:07):
Well down at Boston is back and it is bigger
and better than ever. Joe usually you know, it's two
weeks this year it is three. We're right in the
middle of it, and we wanted to try to find
out a little bit more from some of the restaurant
owners and chefs. Sure why this is such a good
experience for them, because they seem to be coming back
(29:28):
here after.
Speaker 3 (29:29):
Year bigger and bigger.
Speaker 2 (29:31):
I know it. So we are joined by Will Gilson.
He is the owner of a number of restaurants including
the Lexington, Geppeto and Puritan in Company, and of course
he also owns Puritan Oyster Bar. All of those restaurants
over in Cambridge, all participating in Dine Out this year.
Great to have you with us, Will, thank you for
having me absolutely. So let me just pose that question
(29:52):
right to you right now, tell bi us why, and
you've got a number of your restaurants involved, why you've
decided that it's a good thing.
Speaker 5 (29:59):
You know, I think what most people kind of you know,
come to forget because we all get into the winter doldrums,
is that, you know, restaurants, this is probably the quietest
time of year for us, you know, basically, you know,
the two times that Dine Out Boston is happening are
the two times of year when restaurants are always trying
to fill their seats the most, and so you know,
right now is sort of a perfect time. I think,
you know, there's a lot of economic uncertainty out there.
(30:22):
I think a lot of people are trying to get
the best bang for their buck, and so you know,
dine out Boston couldn't come at a better time for
making sure that we're engaging our guests, you know, giving
them an excuse to get out of the house and
come into our places and you know, give them something
to be excited about.
Speaker 4 (30:37):
Give us an idea how different the prices are, I mean,
how much of a discount is it?
Speaker 3 (30:41):
Really?
Speaker 5 (30:42):
You know, it depends on which one of the restaurants
you know that that you're you know, dining at that
is participating. But I would say, you know, kind of
a perfect example is you know, Geppeto are our restaurant
over here in Cambridge Crossing. You know, we have a
three course prefixed menu that is on the menu all
the time and seventy dollars, and the dine out menu,
(31:03):
which is comparable in quality and in portion sizes, is
coming in at fifty five dollars. So you know, it's
basically taking almost twenty you know, percent off of what
the bill would be for you to come in and
be able to enjoy, like I said, the same quality
of food in the same dining room, you know, with
the same level of service. And you know, it's just
a chance for us to be able to use this
as an opportunity to showcase our amazing restaurants to folks
(31:26):
who either have been before and they needed an excuse
to come out, or have never been in before and
this is the perfect reason for them to try it.
Speaker 2 (31:33):
So let me ask you just that are you filling
the seats and are you typically filling them with people
who are newcomers?
Speaker 7 (31:40):
Yeah?
Speaker 5 (31:40):
I mean I think what I always brief the you know,
the restaurant teams for when we're participating in Dine Out
Boston is that we really want when you're coming out
here to you know, when the folks are dining in
our dining room, we want this to be an opportunity
for us to win over new guests. You know, this
isn't just about getting some folks in, making a little
bit of money, the staff making some tips. This is
(32:02):
about us, you know, showcasing our space, making sure that
you know, every single person that dines here is a
new opportunity to make a regular customer at one of
our restaurants. And I think that that's our main goal,
is that this isn't just about might making money. I mean,
obviously that does help, especially at a quiet time of year,
but this is an opportunity for us to make new
fans for all of our restaurants.
Speaker 4 (32:22):
Talking with a chef Will Gilson about dining out, which
is now three weeks, Okay, you get to the March fifteenth.
At the end of the three weeks, you sit down
and you look at the ledger. What success will what's success?
Speaker 5 (32:33):
Well, I mean I think in this sense, you know,
anytime we're bringing in, you know, even fifty percent more
people than we would have had during a normal week
during this time in a sort of year over year,
that's success for us. If every single seat is full,
you know, multiple times a night, then man, that's that's.
Speaker 7 (32:51):
What you could really be asking for.
Speaker 5 (32:53):
I think the thing that's hard is oftentimes diners don't
understand the economics that restaurants face. I mean, you come
and you dish out money for a meal and you're like, wow,
this place must be rolling in it. But it requires
every single person who made a reservation showing up. It
requires making sure that every seat that you have available
gets filled at one point or another, and that you're
able to do it in a way that you know,
controls those costs and actually makes a profit. And so
(33:15):
for us, we sit down and we look at that ledger,
we're hoping to see at least a fifty percent increasing business,
you know, during these three weeks.
Speaker 2 (33:22):
Well, how's business overall? Let's take it out of this
you know, time period. How has business been?
Speaker 5 (33:27):
You know, I can only answer this as somebody who
has most of their restaurants all anchored in Cambridge, and
you know, obviously in Massachusetts. You know, I would say basically,
since election day, we've seen a dramatic pullback in people
showing up for dinner, spending money, throwing private parties. It's
definitely down significantly, you know, year over year. And I
(33:51):
think that that's different for every neighborhood. It's different for
every city in America, I'm sure, But as far as
Cambridge goes, you know, we rely a lot on people
being in biotech, pharma, life sciences, and a lot of
those industries are pulling back as well and doing some restructuring.
So this is an opportunity for us to be able
to make sure that we have those seats available that
(34:15):
we want to give people a reason to come in
and fill them.
Speaker 4 (34:17):
Yeah, how do you explain the drop off? I mean
in your own mind when you sit there, how do
you explain it?
Speaker 5 (34:22):
I mean, do you watch the news and do every
day you not know exactly what's going to happen? I mean,
I think that that's exactly what people are experiencing right now.
I mean every day they wake up and they don't
know if they're going to have a job tomorrow. They
don't know if things are going to cost more tomorrow. Hell,
as a restaurant owner, I don't know if I'm going
to be able to get eggs tomorrow or what their
price is going to be. There's a lot of uncertainty
out there. But the only thing that I can be
(34:43):
certain of is that I know that our places are
filled with amazing staff and that we're serving great food,
and that we want people to be here to be
maybe forgetting about all of that or letting us kind
of inject a little bit of happiness into their.
Speaker 2 (34:55):
Lives, well, well, We certainly hope that Dine Out Boston
is a great success for your restaurants. Again, the Lexington,
Geppeto and Puritan and Company, as well as the Puritan
Oyster Bar will thank you very much for being part
of the show today.
Speaker 4 (35:11):
We want to welcome back to the program this week.
I guess we had on last week a Dave O'Brien,
president and the CEO of the Massachusetts Cannabis Business Association,
and the reason we wanted to have him back is
that there's a lot going on here, folks, and many
of it A lot of it is not very good.
Prices are way down some seventy five percent. Some four
(35:31):
hundred retailers out there are struggling to make a profit,
and it doesn't speak well of well the industry as
a whole here in the state. So Dave, welcome back.
I don't want to be a downer. We can talk
about upsides as well.
Speaker 10 (35:45):
But you'll bring it back up to positivity.
Speaker 7 (35:47):
You don't want right, Go ahead, go ahead.
Speaker 10 (35:51):
I think it's still to your point. When Massachusetts first
legalized this, every state that legalizes said and says, are
we going to be successful at that? In the first
couple of years we were doing over a billion dollars
in sales. I think we're at one point five to
one point six one point seven billion dollars annually in
sales just on the adult use market side now, So
(36:11):
it's no longer theory. It's working right. Customers are going
to stores and buying product. There's lots of choice out
there for types of product, streams of product effects, and
the like. One of the things we're looking at right
now is this many years into the adult use market
and this many more years into the medical market, which
we legalized in twenty twelve. What are some of the
(36:34):
rules that we probably our state probably did a little
too strenuously to begin with. And part of what the
Cannabis Control Commission is considering now is how do they
modernize their regulations And that's something that we're intimately involved
with them on. Did they start off a little too
strenuous when it came to testing limits, when it comes
to product and harmonizing what we do with other states
(37:00):
as regulators, having people not wanting to say we're going
to slash every regulation there is and just let the
market be the market. This is still federally illegal. I
totally understand where the policymakers are coming, but there are
things that can change that will save the industry money.
Some of the fees that they charge are very expensive.
So to have a vertical license costs fifty thousand dollars
(37:23):
a year and you have to renew.
Speaker 7 (37:24):
That every year. That's a big number.
Speaker 10 (37:27):
And once you're up and running, it's sort of maintenance
by the Cannabis Control Commission. So some of those costs
and some of the regulations and rules that the Commission
sort of puts on the industry is something we're looking
very closely, and the Commission's willing to do that.
Speaker 7 (37:42):
So that's been helpful.
Speaker 2 (37:43):
So let's let's get delve into and that's great. That's
great to hear for the industry. Let's delve into some
of the things that you know, Joe and I were
talking about, you know, like some of the cafes and
the deliveries and some of the things that have sort
of tried to, you know, manipulate the business to be
a little more widespread. How are those kinds of things
(38:06):
moving forward and how is that working.
Speaker 10 (38:08):
Yeah, so there's been discussion Kim. When it comes to
the delivery licenses. There are two types of delivery licenses
and massachuest It's one is a courier model, which is
taking the product from a retailer delivering it to a purchaser.
The other is called the delivery operator model, so think
of that as more of a warehouse model, so you
can buy product from the market from cultivators and manufacturers,
(38:31):
put it in your warehouse or depot, and then sell
it and deliver it to people in their homes. The
other thing about the delivery license that is up for
reconsideration is at the beginning of this a few years ago,
the Commission said that delivery license is going to be
set aside for an exclusivity period for social equity and
economic empowerment applicants, which are thick of those as either
(38:55):
people from people that are either individually or their communities
have been harmed by the War on drugs. This is
a bit of a reparative set aside for that license
that is up for renewal to see whether or not
that exclusivity period social equity and economic environment should continue.
We support that, We supported it when the Commission originally
(39:16):
came out in favor of it.
Speaker 4 (39:19):
Dave Obrian's Our Guest he's the president and CEO of
the Massachusetts Cannabis Business Association, and we're talking about well
a number of things going on in the industry. Many
that are these retailers, these so small business owners are
facing many challenges. Where are we in this whole idea
of cafes showing up in communities, cannabis cafes.
Speaker 10 (39:38):
Yeah, this is the last license for the Cannabis Control
Commission to implement, and I think some of the preliminary
regulations that they've put out include single day event licenses,
having a cannabis bar if you will, or cafe.
Speaker 7 (39:56):
I have looked at.
Speaker 10 (39:57):
This over the time. I've been involved in cannabis since sixteen,
and I don't see huge success with it across the country.
It is also a license that is being set aside
for social equity and economic empowerment. It is a capital
intensive if you're going to have a cannabis bar if
(40:17):
you will, because any think of any way that you
would smoke tobacco, which isn't many places you can do
that anymore. You also cannot smoke cannabis flowers. So if
you do that and you have a private club, there's
all sorts of HVAC, so it's very capital intensive to
have a cannabis bar. I think the exciting part is
(40:39):
the one day event licenses, the festival licenses, that sort
of thing. We would just have to see if it's
going to be as fruitful for Massachusetts because other states
have tried. Some have been more successful than others. But
I think the cannabis Control Commissions tried to do their
homework and go out and see, Okay, what can we
build into ours and from the mistakes of other states.
Speaker 2 (41:02):
So Dave, overall, are people still trying to get licenses?
Do they still see it as a business that is
going to be profitable and they want to get into
they are?
Speaker 10 (41:12):
I mean part of it, Kim is. So in the beginning,
a medical license was required to be vertical, so you
had to open up the license that cultivated, manufactured, and
had retail to it. So those early investors in the
medical licenses were had to be very well funded because
it was tens of millions of dollars to build a cultivation,
(41:33):
to build a manufacturing facility, and to open one or
up to three medical retail facilities. I would say the
pace is slowing down. Like I said, we have over
one hundred cultivators. Right now, I think we're almost at
one hundred and forty cultivators, one hundred and twenty manufacturers,
and as I said, close to four hundred retailers. I
(41:56):
think where you're going to see the growth on the
retail side is if communities that were previously banned communities
for retail open up because they see their neighbors making
tax revenue off of a three percent x size tax
that everything sold at the register are at the point
of sale, you know, filling a previously empty storefront, tax
(42:18):
revenue and property helping to increase employment in the community.
So I think communities that were a little skintish in
the past are starting to reconsider that. I don't think
you're going to see a lot of new cultivation and
manufacturing just because it's labor intensive to get it up
and running, it's capital intensive, and it can take a
bit of time. So if you were to start right
(42:40):
now to say I'm going to open up a cultivation
in Massachusetts, it's two to three years old and the
market is very saturated.
Speaker 4 (42:48):
Dave Obrian a final question for me, and I want
to come back at to what you said earlier in
the program. You're talking about a retailer having a license
that needs to be renewed, and the dollar figure you
used was fifty thousand dollars a year.
Speaker 10 (43:01):
Yeah, I want that would be That would be for
the vertical that the license renewal fee. If I'm going
to stop the top of my head, I believe it's
ten thousand dollars. Ten thousand dollars is a lot of money.
Speaker 3 (43:11):
No, it is.
Speaker 4 (43:12):
I'm just wondering, do you have any sort of stats
or as it relates to delinquencies in terms of people
who just flat out aren't paying their their fees anymore.
Speaker 10 (43:22):
Oh, if you don't pay your fees, they shut you down.
It's on an annualized basis. If you're not doing your
renewal with the Cannabis Control Commission and paying your license
and fee, they say, thanks for playing, You're done. The
other thing, Joe, that really has has been something we've
been intimately involved with is the host community agrem We
could do a whole.
Speaker 7 (43:41):
Show on this.
Speaker 10 (43:44):
Where communities basically shake down operators and say you need
to give us an extra three percent for anything that
you might cause us negative impact wise. And you've probably
followed what happened Inhavioral. They had a set at April
m she got seventy percent of her HCA money back.
(44:06):
In Uxbridge, Caroline Frankel at Caroline's Cannabis got one point
one one point two million dollars over HCA back. We
have hold out communities. Newton's holding out and thinking they
don't have to give the money back. They're in court.
Other communities have settled. Pittsfield settled, other communities are settling
as well. Sale and Masses just raised their hands and
(44:27):
said we want to increase the tax on cannabis stores.
So there is no lack of advocacy and fighting that
we have to do on behalf of the industry. But
HTAs is something that is particular. I've called it a
legalized exportion that communities have tried to get away with
the billing the stores and co operators for phantom feed
(44:49):
that santem cost it don't exist.
Speaker 4 (44:52):
Sounds like a good topic for the New England Business Report.
Speaker 3 (44:57):
He's Dave O'Brien.
Speaker 4 (44:58):
He's the CEO of the massive U such Cannabis Business
Association and Kim and I will be following this business
development closely over the coming months.
Speaker 1 (45:13):
You are listening to the New England Business Report on
the Voice of Boston WRKO six' Eighty joe And kim
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Speaker 2 (47:18):
Com hi, Everybody I'm Kim kerrigan And I'm Joe.
Speaker 4 (47:27):
Shortsley if you want to be part of The New
England Business, report sponsorships are still.
Speaker 2 (47:33):
Available you can email us At Any Business radio at
gmail dot.
Speaker 4 (47:37):
Com that's Any Business radio all one word at gmail
dot com and we'll get your business on the show.
Speaker 1 (47:46):
Too The New England Business report ON wrko is brought
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Speaker 4 (48:02):
Com and welcome back to The New England Business. Report
on This March sunday. Morning we're gonna close out the.
Program you. Know you know how in like television, news
they always want to end this news on like a happy.
Speaker 3 (48:19):
Story, well here you go.
Speaker 2 (48:22):
A, kicker we're gonna Get we're gonna kick it.
Speaker 3 (48:24):
Off it's not a, kicker but you know What i'm.
Speaker 4 (48:27):
Saying we're talking about a new survey that caught my,
attention Caught kim's, attention.
Speaker 3 (48:32):
Done BY.
Speaker 4 (48:33):
Kpmg it's a survey Of boston business leaders and it
basically paints a rather rosy picture of what they see
in twenty twenty. Five so let's bring in the managing
partner For boston's office KP, Mg John, capone and he
(48:54):
is the managing partner for. Here he's also his oversight
stretches Throughout New england and Upstate New. York, john thanks
very much for joining, Us, Hi, Joe Like kim tell
us about this new survey Survey boston business, LEADERS i
strategic investments in real estate and talent in twenty twenty
five sounds kind of, rosy you.
Speaker 8 (49:13):
KNOW i like how you tease that, up because even for,
me as A New, ENGLANDER i even thought the responses
were overly optimistic For, bostonians AND i think that's a
good sign of what twenty twenty five might. Have some
of the THINGS i think that are worth talking about
is the optimism that we have in our local economy
(49:36):
and certainly the industries that make up The New england.
Marketplace there's certainly strength in, healthcare life, sciences financial, services
and banking and technology, firms and many of those responded
to our, survey and we're quite optimistic about what the
next twelve to eighteen months holds for.
Speaker 2 (49:55):
Them, well, Obviously, john you've said that this was surprising
even to you who give us an idea of how
this compares to maybe where we were a year.
Speaker 8 (50:05):
Ago it's a notable. Optimism it's a noted. CHANGE i,
think you, know AS i manage our business here and
work with many of our, clients there were certain uncertainties
that sort of permeated the business. Environment it created a
(50:26):
lot of, pause consternation about investing in their, businesses thinking
about the, future making strategic. Investments and it was a
year where a lot has, happened a lot has. Changed
when you think about The JENNY I wave and where
we are right we, can of course cannot forget the presidential.
(50:48):
Election so you had this environment the last twelve months
where there was a lot of factors that impacted how
business leaders thought about how and where we place our
bets and place our.
Speaker 7 (51:02):
Capital SO i.
Speaker 8 (51:04):
Think as you ask, questions and this survey was designed
and it just for some statistics as you as you're
talking to an accountant, here you, know we love our, statistics,
right we spoke to and the response, is you, know
most of the, responses greater than sixty percent came from
some of the largest companies in our. Region so these
(51:24):
would be companies with greater than five hundred million dollars in.
Revenue and when you think about those, responses and most
of the responses came from THE c suite executives OR,
evt eighty percent of the respondents held that. Title when
you get that kind of response where the focus is
now on it's time to rethink how do we improve our,
(51:47):
operations how do we drive more? Efficiency and we look
for opportunity in the. Marketplace and THAT i think was
really the takeaway from me out of this.
Speaker 4 (51:57):
Survey talking with The John, componies managing partner for a
KP mg here In, Boston New england and Upstate New,
YORK i talk about their, survey you, know Because john
on this program AND i don't want to be labor this,
point but on this particular program, today you, know we've
heard from business leaders who are scared, about you, know
what's going on in their storefronts and Downtown. Boston we've
(52:18):
heard we talked About Kendall square at the vacancy rate
being crazy at this, point up around twenty five. Percent
we heard from a restaurant chef who is saying, that you,
know dine Out boston now that they're very scared because
business is really bad at this. Point SO i GUESS
i come back and you're talking about CEOs and THE c?
Suite are are they out of touch or is somebody
(52:38):
missing the beat?
Speaker 5 (52:39):
Here?
Speaker 8 (52:40):
Yes, well let me let me maybe quantify this a little.
Bit so some of the respondents right when you ask
questions about how how how does business? Grow, right and
it starts with having great? Talent. Right, overwhelmingly we're very
lucky to be an environment and in a location where
(53:00):
The New england business can draw from some of the
world class institutions from this. Region and so you start
at a situation where you, say bringing talent and attracting
talent to companies that are interested in. Growing we still
are in a very enviable situation and position compared to
lots of other. Cities you raise questions and observations about
(53:24):
returning to. Work being In Boston Kendall square lab, space
which is sort of the acronym when you think about
synonymous with The Kendall square vacancy. Rates we're going to
continue to see companies go down the path in these critical.
Industries but the return to WORK i think is also
(53:45):
an element. Here, Right how do you keep and attract
talent for companies to thrive and return to work is
certainly a piece of. That and what you highlight is
the fact that most companies are, effectively including, ers using
a hybrid model where you want your employees in you,
know three sometimes four days a. Week but it's not
(54:09):
back to PRE covid when we were all in five
days a week and you had city foot traffic in
the cities like we used to.
Speaker 2 (54:16):
Have, So, john what does this optimism look like over
the course of twenty twenty.
Speaker 8 (54:21):
FIVE i think you know HOW i read this and
WHAT i pull out of. It, certainly there was an
element in the survey about embracing new, technology AND i
THINK i think a lot of the direction that we're
headed is we can gain efficiencies by using some of these.
TOOLS i think it can make the workforce more. PRODUCTIVE
(54:43):
i think it can improve the, climate the work, climate
and folks enjoying more of their business because some of
these tools will help us be more. Efficient SO i
think that was an element THAT i THINK i took
away from. It the other element was the number of
the number of companies and executives that, said, overwhelmingly if
(55:06):
you ask them a very generic, question do you think
in twelve months you'll have a larger workforce.
Speaker 7 (55:12):
Or a smaller?
Speaker 8 (55:13):
Workforce and with that, question you, know an overwhelming majority
said we expect to have a larger. Workforce and that
was probably the big takeaway for me is the optimism
is all around plans to.
Speaker 4 (55:29):
Grow John compone's our guest managing partner OF. Kpmg let's
talk a little bit about remote. Work where are companies
on remote? Work where are they on back to the
office at this? Point and there's also another thing in
your survey here talking about how many of them are
open to a thirty two hour work week.
Speaker 8 (55:46):
THAT i think has been talked about for some. Time
how do you make the work life balance better and
a two hour work week that you talk about in
person with one day. Remote for, us we think that
the hybrid model is working. Well we think there's a
huge benefit of being. TOGETHER i think that's what you're.
(56:07):
Hearing but there is a recognition that people can still
be productive and work from home without that long, commute
and certainly being in this, area we know what that
is all about on A tuesday Through. Thursday SO i
think that's a trend we might hear more about as
we go through this, year for, us our experiences bringing
(56:29):
folks in three or four days a, week teaching them
to learn our business and then sort of an apprenticeship
model is paying. DIVIDENDS i don't think that's going to,
change all.
Speaker 4 (56:39):
Right, So, john as we close out this conversation, here
what's the one thing you're most proud of is you
look towards twenty twenty.
Speaker 8 (56:46):
FIVE i think this renewed sense of optimism that better
days are ahead will put capital to. Work businesses will
and that'll help Our New england.
Speaker 4 (56:55):
Economy oh He's John capone and he's the managing partner
OF kp and here In, Boston New england and Upstate New.
Speaker 3 (57:03):
York and you know what going to close out This
sunday morning on an up, Note, Kim, YEAH i like.
Speaker 2 (57:08):
It, well that's going to do With joe for this
edition of The New England Business. Reports So i'm glad
everybody could be with us This, sunday AND i hope
you can join again Next sunday when we are talking
to the head of one of the Downtown boston residential.
Associations you Heard joe earlier in the show talking about
the fact that folks and businesses and residents are a
(57:29):
little concerned about safety in Downtown. Boston, well his organization
is taking this to the city and we're going to
talk to him about the impact on residents and on
businesses in downtown as the security issue continues to. Loom
in the, meantime we hope you have a great, week.
Everybody I'm Kim carrigan along With joe Short sleep here
on The New England Business report ON, Wrko The voice
(57:52):
Of BOSTON am six eighty
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