Sharp rent increases and rising costs for a diminishing pool of labor have restaurateurs along Boulder’s Pearl Street scrambling to evolve and remain profitable, and similar challenges are facing eateries in the Denver metro.
The news that The Cheesecake Factory will be leaving its Pearl Street location at the end of the year, after nearly 20 years in operation, is the latest sign of the coming change.
Although Sean Maher, Downtown Boulder Partnership CEO, said The Cheesecake Factory’s decision to leave was more of a result of the Pearl Street location no longer fitting its businesses model of operating large restaurants in suburban locations, the rising costs of rent and labor, as well as an ever-increasing base of competition, certainly contributed.
Carolyn Livingston, communication director for the Colorado Restaurant Association, said restaurants often operate on razor-thin margins of 3 to 6 percent. Any sort of increase in operating costs can necessitate a restaurant to reevaluate its business model and in the current environment “many of our members are telling us they’ve never seen it so difficult to run a restaurant,” she said.
With rent increases on Pearl Street as high as 30 percent there is a growing belief among industry experts that the restaurants along Boulder’s iconic pedestrian walkway might soon begin to change their approach.
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