Business

‘Perfect storm’ spelled curtains for 2nd Act

By Bill Moss, Published: September 13, 2023

While it may be tempting to view the demise of the 2nd Act as a canary in the coalmine — hinting that the closing of the popular coffeeshop, wine bar and taproom suggests others may follow — the owner says paid parking was only one of many factors that caused him to draw the curtain.

“When the city of Hendersonville went to paid parking in March, this lot started filling up like crazy with people parking because it wasn’t policed,” Mike Willey, who opened the 2nd Act with his wife, Christa, and two business partner in September 2020, said in an interview. “So the building ownership decided to make it private and rented out spaces to the tenants up here. There’s just not enough spots in there for all the tenants in the building. So I wasn’t allowed to get any spots. So the I lost my parking from 8 a.m. or 9 a.m. to 6 p.m. every night, which cut my day business down about 40 percent on average.”
Willey, who also owns a construction recruitment business that he’s now gone back into fulltime, has a numbers background. The 2nd Act was Christa’s dream, he said. He came alongside her to keep the books and whip up profit-and-loss statements.
“April was my first month (to lose parking in the lot that serves the building) and I was down about 15 percent,” he said. “May I was down about the same, June I was down probably about 5 percent. And then July I was down 25 percent, August I was down 30 percent. And I just said I can’t do it anymore.”
After a divorce, he bought out Christa, then bought out another partner.

Market is saturated

Like Hendersonville City Council members and some downtown merchants, Willey says a variety of brutal headwinds formed a “perfect storm.”

Mike Willey“Everybody wants to blame parking. I certainly feel like parking is part of the problem,” he said. “But at the end of the day, I think it’s a bigger issue. We’ve got such a small market and so many new businesses opening up — you start diluting, (then reach) saturation. I think you’ve got the perfect storm.”
Bad as it was at first — with a lockdown and government rules that burdened businesses — the pandemic actually ignited tourism here, Willey says.
By imposing paid parking, “the city was trying to take advantage of an opportunity of tourism that we’ve had over the last couple of years, which has been tremendous,” he said. “Borders were closed on Europe, people weren’t really traveling abroad, so they were traveling locally, and Hendersonville was a hotspot.”
A cooler June this year in Florida slowed northbound migration, he added, and inflation, gas prices and economic malaise have dampened spending.
“Even though we live in a well-to-do area, people are still on a fixed income,” he said. “And even people with money set aside were not going out as much because the dollar was weaker.”

Summer season down 20 percent

Asked whether they feared the 2nd Act’s closing may hint at a broader threat to downtown’s vitality, city council members cited many of the same competitive factors that Willey himself acknowledges.
“The market’s saturated,” said Jennifer Hensley. “We have a lot of coffee shops. We have a lot of little wine shops.”
Mayor pro tem Lyndsey Simpson cited the decline of tourism this summer as a key.
“I think there are a lot of factors at play,” she said. “It would be naive for me to say that parking didn’t have some effect. Is it the total picture? I don’t think so. I mean, tourism alone, from the TDA numbers for summer, was down 20 percent. That’s a huge downturn and I think the people that are coming are spending less because the economy is kind of up and down and all over the place.”
Willey thinks the space at 101 East Allen, which building owner Andrew Riddle reconstructed down to its origins as a Ford dealership, is likely to reopen as a venture similar to what he ran. Investors are already kicking the tires. For three years, Willey’s 2nd Act was a hit that drew an appreciative audience.
“We weren’t a brewery, we weren’t a restaurant, we weren’t a café, we weren’t just a coffee shop, we weren’t just a music hall,” he said. “We were everything.”
But it could be that in the end everything was too much. One example of market saturation in the beer, wine and cocktail wars: 2nd Act was the first bar around to feature Italian Prosecco on tap.
“Now there’s about six or eight of them that do,” Willey said.