It’s an interesting time to be living in Fort Collins right now, isn’t it? I feel like Fort Collins is in an awkward teen growing phase. Arms and legs are growing fast, giving us a lanky look. Our braces are on tight to straighten out that gap in our buckteeth. And then there’s the hormonal acne that’s popping up on our skin. It used to be on our back, but now it’s moving to our face.
These are hard years to live through as we suffer through growing pains. It’s awkward as hell. But those of us who’ve survived this stage know that things eventually sort themselves out and we grow into our bodies. It’s a challenge to see the light at the end of the tunnel when you’re in it though.
Right now we see crowds of people moving to Fort Collins causing a housing shortage. We have a delicate and difficult challenge with our homeless and train-hopping transient neighbors. There’s traffic congestion like never before. There’s the discussion of urban development vs suburban sprawl to try and fit everyone in. And in this, all we hear are complaints about how it’s “not the same Fort Collins it used to be.”
Well, of course not! Much like life, if we’re not growing, we’re dying. I’ve noticed changes in our culinary scene as commercial development grows. First, when we didn’t have enough commercial space options and businesses started looking at Loveland locations instead. Then as lease rates increased dramatically, causing an exodus out of Old Town. Residential real estate prices increased, making it more difficult for service industry workers to keep up and actually live in the city they work in.
It seems as though those who can weather the economic shift are corporate chains. So then we see a boom of regional and national chains come in to town at Foothills Mall. And you can be sure that people talk about how that’s pushing our small business owners down and out.
It’s a whirlwind cycle that we all feel. And it’s a complicated conundrum with so many layers. Layers upon layers like a crepe cake.
But development is necessary because without it, we’re stagnant and cramped. Things crumble away and we lose our luster. And our money.
Now, I’m not an economist. I’m not an expert on city growth. I don’t have the answers on what’s going on. But, what I do have is years of experience as a dedicated Fort Collins community member, a small business owner who finds that areas outside of Colorado pay higher contract rates, a friend of many other small business owners who are suffering income loss in this city, a wife to someone who struggled to find local work and does better with contracts in Canada, and a mom wondering what a future in Fort Collins might look like for the kids.
First, let’s take a look at the benefits of commercial development happening. Yesterday I wrote about The Loafing Shed and being super excited about Jessup Farm. We desperately needed that kind of space over here on the southeast side of Fort Collins, and it didn’t take long for that area to get cramped with equally excited Fort Collins neighbors. It’s so cramped we’re ripe for more.
So the next thing I’m looking forward to is the development of Harmony Commons on Harmony and Ziegler. Another established local craft coffee house going in, a handful of new restaurants, and a brewery (yet to be announced, but a lease has been signed). This is all exciting to me because I have another brewery I can ride my bike to! An alternate coffee house for meetings that hopefully won’t be as cramped! And there are two to three more food concepts that are still in the works there too. Some of them I’m excited about, and not particularly others (more. pizza. ugh).
I had a chance to get Brinkman’s thoughts on commercial development in Fort Collins and restaurant trends that they see as they develop areas like Harmony Commons.
Restaurant Trends We’re Seeing in Fort Collins
80/20 Rule: Our tracking shows us that over the last 5 years, we’ve consistently seen approximately 80% of retail composed of local and regional tenants and 20% of national or New to Market tenants. This holds true for restaurants and primary employers throughout the area.
- The Size of our Market: The population of our market better supports local tenants than large national tenants and because of our size and demographics, we are not on the radar of a lot of the national users like we would be if we were a larger market.
- The Character of our Market: Northern Colorado prides itself on our unique and ‘buy local’ culture. This creates an attraction to homegrown users and fosters an environment of entrepreneurial business owners dedicated to creating a local experience for area residents. We like to go out to dinner and know the owner of the restaurant, run into friends, and be presented with an experience that feels Fort Collins.
- How Tenants End Up in Certain Locations: Specific retailers end up in these locations based upon demand drivers; demographics of surrounding neighborhoods, proximity to employers, traffic patterns, locations of their other stores, location of competitors etc. Harmony Commons has really strong demand drivers being located on Harmony Road with great accessibility and traffic visibility on the hard corner, and being in close proximity high household incomes to the south as well as an under-served Timnath community.
- The Harmony Corridor Buildout: As the Harmony Corridor has been built out with some larger centers, this has created a number of unrepresented tenants that can’t go into those centers due to exclusivity restricted uses (i.e. can only have one sandwich shop, one sushi restaurant, etc.)
- Unrepresented meaning they don’t have locations on Harmony Road. There are a number of prospective tenants who want to be on Harmony Road, but exclusives and use restrictions have prohibited them from going into larger centers.
- The Unique Regional Concept: Over the course of the last 5 or so years, Fort Collins has gotten on the radar for popular, yet unique regional concepts. Our strong demographics have started to attract and support concepts that fall in the smaller tier of “chains” that focus on providing a distinct experience in each market they are in. Examples include: Jax Fish House, The Kitchen, The Mainline, Illegal Pete’s, Snooze, Little Man Ice Cream
- Composition of our 20%: At Harmony Commons, we are focused on sourcing tenants that are “uniquely Fort Collins”. In our search for tenants outside of the immediate area, we are looking for the unique regional concepts. These enhance and elevate the local food scene while not watering down the culture of our community. To connect with the relatively non-gentrified southeast Fort Collins area, our vision is to create a comfortable, inclusive center. You can go with your family to enjoy a meal, feel comfortable with having your kids there, and be dressed casually (the Colorado way).
Where Brinkman is Headed with Our Development: Beyond projects like Harmony Commons that serve an underserved area with restaurant and community amenities, our goal with development in the area is centered on adaptive re-use. We are currently working on The Exchange (200 North College) which repurposes an existing blighted area within Old Town to create a great place for the community together to gather. The Exchange will be a convergence of great food, entertainment, mercantile, and creative outdoor areas. In the inner plaza, inspired cuisine, craft cocktails and beer will be served via Food Container Cars and there will be an Entertainment District for various events. The perimeter of The Exchange will include restaurants, a rooftop deck, retail and creative office spaces.
I also had a the opportunity to chat with Josh Guernsey, Partner at Brinkman about some of the development challenges that we see. Sure, new things are exciting, but what about the not-so-roses-and-rainbows aspects? Like our perception of gentrification in Fort Collins?
If Brinkman isn’t building new, then they’re repurposing buildings. This continues to keep things in Fort Collins fresh and new, repairing leaky roofs, and keeping our commercial buildings interesting. It’s also part of driving construction costs with already busy contractors, and passing those down to small business owners. Josh brought up that we’re at the top of a real estate cycle that had been increasing for the last seven years, and since we’re at the top, we should see some market stabilization (and not as many lease rate increases).
But, this is like turning a cruise ship a degree and waiting to end up in a new direction. Things take a long time to sort out in the market. And when the increase of cost is shared with small business owners in Fort Collins, they start to suffer. This is a fear when it comes to the development at The Exchange, where Pateros Creek Brewery is now.
Steve and Cathy sat down with me to drink a beer and talk about some of the challenges they’ve faced as small business owners in Fort Collins. You’d think beer is an instant money-maker, but that’s not the reality. Owning and running a brewery is really hard, exhausting work and it’s not as profitable as our Fort Collins community seems to think. In fact, many of the newer breweries that have opened have owners that are currently working two jobs – their day job and then running their breweries. With developments like The Exchange, small businesses can expect to pay $20+ a square foot when they were paying $9 a square foot. That’s a dramatic increase and exactly why we’ve been seeing so much business shifting. It’s not just the food and beverage industry either. Many Old Town retail locations are sharing that they’re down at least 20-25% in profits compared to last year. Lower profits, higher lease rates – it doesn’t take an economist to do the math.
When lease rates increase in Fort Collins, Josh at Brinkman suggests that it’s time for business owners to get creative and raise the bar. I can agree with this to a point. If we have a million pizzerias opening, then yes – we need to get creative and start looking at new concepts like introducing Korean BBQ to Fort Collins, or something similar. Lord knows we don’t need more of the same! But, how does a brewery with consistently new experimental beers get more creative than they already are? When the general public of Fort Collins is drawn to familiar, consistent concepts like pizza and Fat Tire?
They lean on the community.
And this is where our community evolution happens. Again, there are more layers to this massive crepe cake of an issue, where our residents supposedly don’t make enough money to dine out frequently and that a $40 dinner is out of budget, there are a shocking number of community members utilizing the pantries at the Food Bank, people are drawn to the new and shiny developments leaving the older ones scrambling to find new customers, people also get in their familiar ruts, and Old Town is starting to struggle with some serious challenges with trouble-makers driving businesses out and people away.
But it takes each and every one of us to support what we love. WITH MONEY. If you don’t pay for it, it dies. Breweries, coffee houses, food trucks, the bar around the corner – your community writers. It takes a whole lot of people to pull together to endure these growing pains.
So, I leave you with this editorial challenge. Instead of complaining about how Fort Collins isn’t what it used to be – do something about it to make it better. Don’t have the funds or the time to invest in something that will make waves? That’s fine. It doesn’t take big moves to make things better. Get out there and patronize the people who have made that investment. Be excited about our growing developments and understand that those costs are being passed along to small business owners who can’t afford to pay higher wages without your help.
And yes, this goes WAY beyond Fort Collins. It’s a problem we face as a nation. But let’s drop the Fort Facade and get down to our deep community roots to make Fort Collins what we want it to be – new commercial developments or not.