CREJ

Page 12 — Retail Properties Quarterly — November 2021 www.crej.com N ecessity, as they say, is the mother of invention. For many of Colorado’s restau- rants, the COVID-19 pan- demic has been the mother of adaptation, innovation, flexibility – and rapid reinvention. In the early days of the outbreak during the spring of 2020, restaurants largely were shut down by both local and state municipalities. Many res- taurateurs had to completely change their operations so they could handle the shift to serving customers via pickup and delivery. Later they had to figure out how to create outdoor din- ing programs to provide their patrons with more safe options. Not long after getting their opera- tions up and going, restaurants were hit with an enormous labor shortage created in part by the government’s accelerated unemployment program. And finally, the current supply chain backup is creating additional sourcing challenges. In many ways, the pandemic has created a Darwinian “survival of the fittest” environment for the service business. Like being a silent movie star when the talking movies came in, they’ve had to learn to adapt and play by the new rules or lose market relevance. Having to navigate around a complete shutdown and file for gov- ernment assistance was extremely burdensome for restaurant operators. Many owners decided that it was not worth trying to stay open and just shut their businesses permanently, while others decided they had to adapt. Perhaps the most intriguing change has been the expansion of the out- door patio. As new data emerged about how COVID-19 was spread, more customers insisted on eating outside. It seemed logical that if you were in the open air, there would be less chance of expo- sure to the virus. As a result, seating spilled out onto sidewalks, lawns, streets, parking lots and alleys. Cities, developers and owners all embraced the expanded terraces as it activated streets, bringing more pedestrians walking about and creat- ing a European feel. Best of all, except for costs such as building a patio or purchasing propane tanks for heating, the area generally was provided free for the restaurant. The availability of adjacent outdoor dining space has, at least temporar- ily, redefined what constitutes an “A location.” In many cases, eateries fortunate to be located near a closed street have been able to expand their seating capacity by 50% to 75%. This has helped increase sales, and for the most part the expanded spaces have not created an increase in tenant rents. In Denver’s Larimer Square neigh- borhood, Larimer Street between 26th and 27th and 29th and 30th streets, and Glenarm Street between 15th and 16th streets are among the many roadways that are closed to provide dining space through at least Octo- ber 2022. The level of creativity some restaurants have shown in devising outdoor dining is astounding. Spaces include cozy igloos, spacious enclosed tents, heated domes, greenhouse structures, yurts and even a repur- posed Airstream trailer at one eatery. Many structures initially built as temporary seating at the beginning of the pandemic have taken on a more permanent look, some outfitted with televisions, rugs, sofas, plants and all the comforts of home. Some restau- ranteurs are adding protection against the elements and installing heating systems for winter temperatures and misters or air conditioning for cooling in the summer. Now that many diners have grown accustomed to outdoor dining, it will be interesting to see which patios become permanent and which must come down. While the outdoor spaces seem to benefit everyone with increased revenue for the operator, additional sales tax revenue for the city and a more stable tenant for the land- lord, the concept still comes at a cost. Most patios are located on public spaces, which can negatively affect both vehicular traffic flow and pedestrian foot traffic; in some cases, dining patios are forcing people off sidewalks and into the streets. At some point cities likely will reel in their open patio programs, and the culinary world will have to prepare Front Range eateries are taking it to the streets Outlook Stuart Zall President, The Zall Co. The availability of adjacent outdoor dining space has, at least temporarily, redefined what constitutes an “A location.” The level of creativity some restaurants have shown in devising outdoor dining to address the elements have made many somewhat per- manent structures. Spaces include cozy igloos, spacious enclosed tents, heated domes, greenhouse structures, yurts and an Airstream trailer. Please see Zall, Page 25