Several Orange County companies are facing millions of dollars in losses as they survey equipment and office damage, construction costs, lost sales and destroyed products in the wake of Hurricane Sandy.
The storm—which changed from a hurricane to “superstorm” status as it swept through the Eastern seaboard in late October—caused severe flooding and other devastation that left automakers, hotel builders, medical device makers, retailers and other OC companies toting up damage costs.
Days after the storm, Aliso Viejo-based Sunstone Hotel Investors Inc. lowered its quarterly and year-end financial outlook in the wake of the storm. The company owns 32 hotels nationally and lost almost $2 million in the Washington, D.C., and Baltimore markets.
Sunstone now projects that its 2012 profit will total $7 million to $12 million. That’s down from an earlier projection of $15 million to $22 million.
“We saw some significant cancellations in some major hotels,” Chief Executive Ken Cruse told analysts on a conference call following Sunstone’s third-quarter earnings report.
The Hilton Bayfront in San Diego was among properties hit with room or event cancellations amid a rash of storm-prompted flight cancellations.
Irvine-based drug maker Allergan Inc. lost power for a few days at its large research and development center in Bridgewater, N.J., but is now back to full operation.
Employees at Irvine-based device maker Edwards Lifesciences Corp.’s manufacturing plant in Puerto Rico had limited resources after the storm and some field sales representatives lost power.
Irvine-based Taco Bell Corp., part of Yum Brands Inc. in Louisville, Ky., had dozens of its fast-food restaurants hit by power outages. Almost a dozen sites in New Jersey and the Philadelphia area were without power for more than a week.
“The good news is no one was injured,” Taco Bell spokesperson Rob Poetsch said.
Sense of Normalcy
Frank Petillo, a senior developer and engineer in the New Jersey offices of Irvine-based Zumasys Inc., is among those trying to regain a sense of normalcy in the storm-walloped region.
“The loss of power, fuel and food has made it a challenge I would not like to endure again in my lifetime,” said Petillo, who lives in Manahawkin, N.J.
The town’s schools became shelters for displaced area residents.
Zumasys’ New Jersey business came to a near standstill after the cloud-services provider lost power for almost three days, though Petillo was able to use cellular data networks to connect with customers. Zumasys also adjusted customer websites and relied on data centers in Irvine and Las Vegas to provide customers access to essential service during the outage.
“For me, business has returned to normal, except for leaving the house in the afternoon to go and help out,” Petillo said last week.
Santa Ana-based real estate data and analytics provider CoreLogic Inc. estimates 280,000 homes in the mid-Atlantic region area face up to $87 billion worth of flooding and other storm damages.
“It appears that this was the worst possible surge that could result from a Category 1 storm,” said Tom Jeffery, chief hazard scientist for CoreLogic.
Raging waters engulfed 300 of Fisker Automotive Inc.’s Karma luxury-hybrid sedans parked at the Port Newark Container Terminal.
Sixteen of the vehicles also caught fire after the salt water caused a short circuit in at least one vehicle and winds spread the flames. The Karmas, which carry a base price of $103,000, had been pegged for dealer inventories across the country.
“We’re working on insurance claims,” spokesperson Russell Datz said. “We expect there to be some shortage of cars at dealers.”
Separate from those difficulties, Fisker did what it could to help others in the region when it temporarily converted its 3.2 million-square-foot plant in Wilmington, Del., to a staging area for emergency and utility fleets.
Some 300 trucks used the site, and a large food tent was erected for relief workers. The former General Motors Co. plant won’t be put into production by Fisker for its second model, the Atlantic, until at least 2014.
Irvine-based Mazda North American Operations had more than 1,000 vehicles at least partially damaged at the Newark port.
“A number of dealers [sustained] quite a bit of damage,” spokesperson Jeremy Barnes said.
Hyundai
Costa Mesa-based Hyundai Motor America lost about 400 vehicles to storm damage, while sister company Kia Motors America of Irvine moved its fleet at the Newark port to higher ground before the storm. But Kia dealers in New York and New Jersey lost an estimated 200 cars.
“KMA is working closely with these dealers on a recovery plan,” spokesperson Scott McKee said.
Kia’s regional office in East Brunswick, N.J., which has 50 sales and marketing employees, lost power for several days, and a couple dealerships reported lingering outages last week, McKee said.
