More than 50 restaurants open, 29 close in Fort Collins in 2018

Could Fort Collins be reaching saturation on the number of places to eat and drink?

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This city of 170,000 saw 53 new eateries open this year while 29 closed — an increase of 24 new restaurants and bars. It’s about the same number of openings as last year when nearly 60 establishments opened but an acceleration in the number of closures: 29 compared with 14 last year.

That brings the number of restaurants in the city to about 650. 

Residents bemoaned the loss of longtime favorites Bisetti’s and Old Chicago in Old Town but celebrated the return of Panhandler’s Pizza. The restaurant business has always been tough, but longtime restaurateurs say this market might be the most challenging they’ve seen. 

In a city like Fort Collins that gets new dining options every month, even old favorites need to adapt and change. 

“Competition makes for a much better marketplace for the consumer,” said Steve Lauer, who opened and closed a couple eateries in the past two years. “More choices are good for the community and requires all restaurants to perform at the highest level.” 

Given the abundance of choices — and pressures of rising costs — the business has never been more challenging than today, said Lauer, who owns Simmer and Rally5 but closed Mac’d Up this year. 

Lauer pointed to the roughly 10 restaurants that opened at the renovated Foothills shopping center within a couple years. With the exception of C.B. & Potts, which moved from Campus West, all were new to Fort Collins.

Based on the brands’ national sales averages and what volume would be required to cover rent and overhead at Foothills, “the expected average annual volume per location would have to be more than $2.5 million,” he said.

“Developing over $25 million in expected new restaurant revenue in one development alone in a year’s time is significantly higher than the population growth rate would make up for,” he said, doing the math on Foothills’ 10 restaurants.

Since Foothills reopened, three eateries closed: The Melt, Grimaldi’s Pizzeria and, most recently, Casa del Matador. 

The Melt closed all Colorado properties, Grimaldi’s left a wake of unpaid taxes and Casa del Matador blamed its closing on financial hardship. All are still vacant.

Is the bubble bursting?

Jason Barrett, CEO of The Rio Grande Mexican Restaurant and owner of Rare Italian, couldn’t agree more. “The air is being let out of the bubble, and oversaturation of the market is one of the largest conspirators,” he said. 

Like most restaurants, the Rio, which owns six restaurants in Denver, Boulder, Fort Collins and Greeley, is challenged by higher labor costs due in part to Colorado’s mandatory minimum wage hike, increasing building rents and health care costs, rising commodity prices, pressure to add delivery, and competition from grocery stores that offer ready-to-go meals.

The minimum wage hike alone, which will increase 90 cents an hour every January until it hits $12 an hour in 2020, “is not an easy thing for restaurants,” Barrett said. “It’s a $250,000 hit to our bottom line.” 

But that’s the stream The Rio has to swim in, he said, so it has tweaked its menu, emphasized service and is concentrating on protecting its core staff.

The Rio had record profits in 2016 during its 30th anniversary year. Last year was flat, and this year is down slightly, he said.

To stay relevant and competitive, The Rio is changing things up: doing full-scale renovations in Boulder and Denver, taking a hard look at hiring practices and training, and adding delivery. 

“It’s exciting and somewhat unnerving,” Barrett said. “This is the most comprehensive, holistic change and evolution of the company to meet all the things that are out there.” 

It’s a risky business that banks on attracting new diners while retaining its loyal customers. “Companies evolve, and we have to evolve. We have to trust that the folks that have been with us all these years will keep coming back.” 

But for a restaurant that relies on liquor sales as part of its economic model, some changes, like adding delivery, “will erode that a little bit,” he said. 

Lauer, who has opened dozens of restaurants in Fort Collins over the years, is holding off on expanding in Fort Collins “until we see how the market will shake out.”

“It’s a pressure cooker where something’s gotta give,” he said. “You can’t keep opening and not close any.”

Old Town opportunity or cause for concern?

Nearly 40 percent of restaurant closings this year were downtown, with the loss of some long-established and well-loved eateries, including Bisetti’s, Old Chicago and The Chocolate Cafe. Downtown also lost La Luz, IHOP, Mainline Ale House, Subway, Craft Tacos and Tequila, and Wasted Space. Five of the spaces remain empty. 

Bisetti’s, part of the fabric of Old Town for more than three decades, closed in January. Owners Bob and Heather Bisetti — who had been living in Arizona for several years —  decided to retire from the restaurant business and sell the building. 

Fahima Kamandy, who owns Ever Open Cafe on North College Avenue, purchased the property at 120 S. College Ave. for $3.35 million. Subway, adjacent to Bisetti’s, closed down as well, and Kamandy turned the property into four retail spaces now occupied by All Sales Vinyl, Sunday Supply Co., Stillwater Outdoor Culture and a jewelry store. Ku Cha House of Tea remains open in its original location.

Mainline Ale House, which had occupied a 114-year-old building at 125 S. College Ave. for only five years, was the largest restaurant to close, at 10,600 square feet and 450 seats.

The building was just too big to sustain the restaurant, Mainline’s owners said at the time of closing. 

Mainline is just north of Old Chicago, which closed in August after 36 years in Old Town. Old Chicago’s Timberline Road location remains open.

La Luz suffered following a salmonella outbreak at its 200 Walnut St. store.

Outside of Old Town, IHOP shuttered its oldest Fort Collins location on South College Avenue after 44 years, and Applebee’s became the latest chain to close a local store.

While Old Town suffered a large number of losses, it also saw its share of openings, including a multitude of eateries at The Exchange — in the 200 block of North College Avenue bordered by College Avenue, Pine and Jefferson streets — which is emerging as an eclectic mix of food and drink.

Fort Collins Donut Co., Pizza Press, Old Town Churn Ice Cream, Vatos Tacos and Tequila, and Chick’nCone all opened this year, while Steamies Burger Bar, Japango, artisan beer project The Crooked Stave and Infinite Monkey Theorem’s satellite wine taproom are expected to open next year. 

The Exchange consumes an entire block that once included three buildings separated by a parking lot. Construction has just about wrapped up, converting the former pawn shop, tattoo parlor and home decor shop on the north and former cidery and ceramics shop on the south. CopperMuse distillery remains where it was. The shops, some in spruced up shipping containers, surround an open-air plaza. 

Developer Brinkman hopes to have the plaza designated as an entertainment district where people can buy food from one vendor and drinks from another. Visitors would be able to mingle in the plaza with adult beverages in hand. 

Old Town also gained Old Elk Distillery, Choice City Wings, The Regional and Union. 

“It’s a hyper competitive environment for restaurants right now,” said Steve Taylor, owner of Hot Corner Concepts, which runs the Moot House, Austin’s, Comet Chicken and Big Al’s Burgers and Dogs. “But it’s been that way for awhile. We were probably over on restaurants, and there’s a natural correction that comes with that.” 

Still, there’s always room for a great restaurant in our town, said Taylor, who closed Enzio’s Italian restaurant on Mountain Avenue in 2016 and opened Comet Chicken in its place last year. “We’re happy with the decision,” he said. 

A tight workforce continues to cause fits for restaurateurs as they’re all competing “for a small number of people,” Taylor said. “The pressure on staffing is extraordinary. We’re so fortunate to be in a college town; we get a new crop of kids every spring and fall.” 

Taylor insists there’s no secret sauce to staying in business for decades, like he has. The Moot House has operated since 1972, and Austin’s opened in 1997 — longevity that comes from providing strong training, consistency and good service. “All the guys who are successful know how to do it,” Taylor said. “The challenge is to just keep doing it.” 

Grocery stores add to competition

As competition increases from new and virtual restaurants and food trucks, grocery stores are also putting pressure on restaurants with hot soups, fresh-made pizzas, sushi, deli sandwiches, rotisserie chickens and other foods, Lauer said. 

Grocery stores “are getting aggressive on deliveries, drive up, pickup … and they’re more competitive with home meal replacement and robust deli sections. They’re making a huge effort to cater to people.”  

For the consumer, it’s not a bad thing, he said. “It creates variety, value, all kinds of things.” But it can also cut down on the number of times a family or individual orders takeout, grabs a quick meal through the drive-through or goes out to eat.

“When you go to the grocery store, it will be a less expensive meal and you can eat healthier a lot of times,” Lauer said. “A lot of times people will eat healthy at home during the week then go out and splurge on the weekend.” 

We’re a dining out kind of town

Fort Collins’ restaurants, bars and caterers generated $434.4 million in sales through November, the second largest net taxable sales in the city behind grocery, convenience and liquor stores, according to the city’s December sales and use tax report, which reflects sales through November.

But restaurants, bars and caterers are the largest sales tax generator, according to the report, with nearly $16.7 million collected for the first 11 months of the year. Restaurant and bar sales were flat in November but are up 5.3 percent year over year, according to the sales tax report.  

What is a virtual restaurant?

Three restaurants, Oasis Bowls, Diner 99 and Quick Cakes, opened in the virtual universe. Owned and run by siblings Kyra and Cooper Burke, the restaurants operate from a commissary kitchen at 1800 E. Lincoln Ave. 

Customers can’t dine in, but they can order for delivery or pickup through online ordering and delivery services Grubhub and DoorDash.

The virtual restaurants serve smoothies, acai bowls, diner food and Japanese-style pancakes. The concepts have their own social media pages and are typically open from 7-11 a.m. daily, with late-night hours from 9 p.m. to 1 a.m. Fridays and Saturdays.

The list

Here’s a look at who left, who came and who’s on the way: 

Openings: Asiana Foods, Backyard Bird, Beijing Noodle, Brunch Brothers, Bump N Grind coffee bicycle food cart, Cancun Mexican Grill, Chick’nCone, Choice City Wings, Cinnabon, Colorocko Taco food cart, Dan’s Van food truck, Emporium Sports Bar, Friendly Nick’s Butcher, FoCo DoCo, GameDay Sports Grill, Handy’s Restaurant, Honolulu Poke Bar in Front Range Village and Campus West, La Dolce Vita Bistro Italiano, Lirano Wine Bar, Marchio’s Grill, Masa Hibachi Steakhouse & Sushi, Metro Urban Food & Booze, Mobile Pho food cart, NoCo Distillery, NoCo Q food truck, Ohana Bowls food truck, Old Elk Tasting Room, Old Town Churn, Oregano’s Pizza Bistro, Panhandler’s Pizza, Pizza Press, Rally5, Red Truck Beer, Rita’s Italian Ice, Rose’s Rub Shack food truck, Simmer, Sundance Chuckwagon food truck, Rush Bowls, Sips Grub & Pub, Smoothie King,Suh Sushi & Korean BBQ, Taste & Savor Wine Bar, Tecate Grill, Thai Station, Ras-Ka, The Regional, Turtle Mountain Fermentery, Union, Urban Bricks, Vatos Tacos & Tequila, Ye’s Poke Station, Ziggi’s Coffee