CREJ

Page 28 — Retail Properties Quarterly — August 2021 www.crej.com and services rises at an annual rate of 1,000% or more. Personally, when my wife told me that I spent over $1,000 on gas in June, saying I was shocked is an understate- ment. I do not want to knowwhat that number will come in at for July.With the work-from-home environment and a big percentage of Colorado employees not commuting back and forth to work, consumer outrage over the prices at the pump has really been muted locally and nationally. Restaurant owners know about the inflationary state of the economy we are seeing, and every establishment has had to raise its menu prices, some two or three times, during the last 12-18 months. Commodity and labor price increases are getting passed along the supply chain and squeez- ing restaurant profitability. Ultimately, it’s being passed onto the consumer, but pent-up customer demand has accepted these increases for now. However, if these increases do not slow down, consumers eventually will need to cut their discretionary spend- ing and the majority of that will be felt by the restaurant industry first, further hampering the recovery that is just now starting. n Labor. Another big issue facing the food and beverage industry is the sever labor shortage. During the pandemic, restaurants were forced to lay off employees to cut costs in their efforts to survive. At the moment we have no governmental occupancy restrictions, but very few restaurants are operating at full capacity because they have not been able to hire back the appropriate staffing requirements. So, restaurants are now dealing with their own operational restrictions, and this is preventing them from maxi- mizing performance and profits. Wages paid to keep current employ- ees along with starting wages have all increased and some businesses are even offering signing bonus with 30-, 60- or 90-day wage increases after hir- ing, but positions still are left unfiled. More concerning is just the total lack of applicants applying for the jobs. I was driving past a McDonalds the other day and out on the street was a big sign on the road saying, “Hiring, starting pay $18/hour.”This is a $5.28 premium over the current Colorado minimum wage of $12.32 an hour that was typically the starting wage for an entry-level position at fast-food establishments. If the typical entry- level position is now commanding a starting pay of $18 per hour, is this the new effective minimum wage in Colorado? If so, this represents a 144.57% increase over the 2011 mini- mum wage of $7.36 per hour and a 50% increase over the 2020 minimum wage of $12 an hour. n COVID-19 resurgence. The Colorado COVID-19 data listed our seven-day positivity rate as of July 29 at 5.11%, which has more than doubled from our most recent low of 2.28% listed on June 19. On July 30, Gov. Jared Polis issued the Fifth Amended Public Health Order 20-38: “The Order requires face cover- ings in some settings. Additionally, the Order maintains some restrictions on certain activities while we continue to take steps to limit the spread of COVID-19 in Colorado, which includes a provision that authorizes CDPHE to require a county to comply with additional restrictions should certain metrics be met.” If our positivity rate does not quickly flatten, the governor will have no choice but to implement increased mask man- dates and occupancy restrictions soon will follow. The Colorado restaurant industry is on the path to recovery, but right now it is still too early to know if the light we see is the end of the tunnel or just another flicker and a much longer road lies ahead. s robert.hudgins@cushwake.com Hudgins Continued from Page 20 The $18 per hour listed in the above chart is for illustrative purposes only and is not the actual Colorado minimum wage currently in effect. Data from Colorado Department of Labor and Employment will offer. Usually these comprise 30% or more of revenue, and if they are higher, the business is likely on solid financial footing. n Build-out requirements. The prac- tice will need individual treatment rooms, only slightly larger than the average spa, with sinks. It may need 220-volt outlets in the rooms that have lasers, and good venting or air filtration systems. Lasers produce plumes that can be both foul smelling and/or toxic, depending on the type of procedure. Generally, space requirements range from 1,700 to 4,000 square feet and comprise four to eight treatment rooms, some storage and lobby area. The most similar layouts are those for massage studios (think Massage Envy, but with fewer treatment rooms) or a traditional doctor’s office but with fewer or possibly no offices. The fin- ishes, however, will be more expen- sive. Clients are paying luxury prices and expect a luxury experience. Ten- ants will require parking, preferably dedicated and somewhat private. s drwaples@restormedicalspa.com Waples Continued from Page 26