General Restaurant Reopening

Gov. Jared Polis announced on May 25 that Colorado restaurants may begin to reopen for in-person dining on May 27, 2020. Below please find some important requirements that restaurants need to be aware of when considering reopening:

• Beginning May 27, 2020, restaurants may reopen with 50% capacity for in-person dining. Note: The guidelines do not provide guidance for outside seating. Some counties have taken the position that this restriction does not apply to outside seating, but the governor’s orders do not provide clarity on this matter.
• Parties are limited to eight people or less.
• Parties must be six feet away from each other, including in outdoor dining areas.
• All employees must wear masks.
• Employees should also wear gloves whenever possible during meal preparations. Gloves should be changed in between tasks.
• Bars must remain closed to in-person patrons.
• Outdoor dining should be encouraged.
• Restaurants should use maximum ventilation by opening windows and minimizing air conditioning when possible.
• Reservations should be encouraged and ideally required.
• No self-service, buffets or seat-yourself options are allowed.
• People may not sit at the bar if it is being used to prep food or drinks.
• One employee per shift should be in charge of ensuring staff and patrons comply with the rules.
• Customers must wear face masks when not eating or drinking.
• Tablecloths should not be used unless they are single-use or removed, replaced and washed between parties.
• Disposable menus should be used. Alternatively, the use of online menus is encouraged.
• Bathroom capacity should be reduced to allow for 6-foot distancing.
• Colorado Department of Health & Environment COVID-19 Guidance for Restaurants and Food Services

Denver’s Temporary Program to Expand into Open Areas

Denver recently announced a new program to allow restaurants to expand into additional outdoor areas in order to allow restaurants to increase their capacity, while still maintaining social distancing. The new program is a way to streamline the approval process as opposed to having to apply and obtain approval from multiple different agencies. The current advice is to apply as soon as possible for the right to expand into new outdoor areas. The city will then work with each applicant to find the best solution for the specific restaurant and space. Below please find some additional details regarding this program:

• One-page application form.
• The program will run from May 27, 2020, to September 7, 2020.
• Streamlined, parallel tracks with less regulatory red tape and fees.
• This will be tailored to each restaurant, but restaurants should apply now to enter the queue.
• Eligible Establishments: restaurants, cafes, fast food outlets, coffee shops, bars, taverns, brew pubs, breweries, microbreweries, distillery pubs, wineries, tasting rooms. Note: Food trucks and other mobile establishments are not allowed.
• The expanded areas may operate until 10 p.m. Sunday through Thursday and 11 p.m. on weekends and holidays. These hour restrictions do not apply for indoor or outdoor space already approved for food services, such as patios.
• 16th Street Mall. Still need to apply through the Downtown Denver Partnerships Cluster Permit with the BID and submit an individual application.
• Restaurants are not allowed to share space, but if they are looking to close a street, they are encouraged to apply together for the street closure.
• Insurance will be necessary if the expanded space is in a right-of-way.
• What is allowed:
  • Expansion into parking lots, streets and sidewalks—private areas and public right-of-way (subject to the zoning restrictions listed below)
  • Sit-down dining
  • Customer pick-up
  • Carry-out service
  • Temporary tents, railings, benches
• What is not allowed
  • No standing areas
  • No live entertainment or games
  • No amplified sound
  • No encouragement of congregation
• The current health orders do not make it clear what the capacity requirements are for outdoor areas of the restaurant.
• Restaurants must post a notice for five days; if there are more than 15 complaints, then a hearing will be held regarding the use of the expanded space.
• Restaurants must have a use agreement with the city or the neighbor’s property they are using.
• Liquor License Requirements. The space must be contiguous to the premises and the property owner must consent.
• Zoning Code
  • “Most private property is zoned under the Denver Zoning Code (DZC). These properties can expand outdoors on their own property or on a neighboring property (with permission from the other property owner), including using any number of off-street parking spaces.”
  • “If your property is zoned under the Former Chapter 59 zoning code (FC59), you can only use outdoor area on your own property and you can only occupy off-street parking spaces that are above and beyond the minimum number of spaces required by code.”
• Takeaway: Apply now for the potential right to expand. If there are multiple options a restaurant is considering, those should all be included in one application. The city is ready to work with restaurants to find the solution that works best for all parties. Once a business applies, they will be issued a process coordinator to help with the application and permitting process.
• https://www.denvergov.org/content/denvergov/en/covid-19/support-services/business-assistance/temporary-outdoor-business-operations-.html

Lease Considerations:Items That Should Be Considered Before Expanding Business Into Public Areas

Many tenants are requesting to use space outside of their rented premises to allow for curbside pickup, to-go food or as additional restaurant space. Below are some items that must be considered by both landlords and tenants prior to using this additional outdoor space:

• Many leases prevent the use of sidewalk sales or outdoor sales.
• Many leases have protected areas that allow for larger tenants to prevent certain activities within specific areas. This often includes the sale of goods outside.
• Many shopping areas are controlled by declarations that may prevent outdoor sales or sales in public/common areas.
• Some shopping areas have Reciprocal Easement Agreements that could prevent the sale of goods or provision of services outside specified areas.
• Leases that use percentage rent should consider if sales in an expanded area will be considered part of the gross receipts for percentage rent.
• Landlords should consider how to deal with the possibility that multiple tenants will want to expand into the same area. Under the current guidelines, the expanded restaurant areas must be entirely separate.
• Takeaway: Tenants and landlords should consult the lease and any recorded Reciprocal Easement Agreements or declarations for any specific restrictions. Tenants should also seek their landlord’s approval before implementing any sales in expanded areas.