There is a new proposal by the Denver city council to prohibit the construction of gas stations. The new bill puts forth several proposals that would make it increasingly difficult if not impossible to build new gas stations in Denver County. Ironically it will now be harder to build a new gas station than open a new pot dispensary or liquor store or sell magic mushrooms. What is in the new proposal and how will it impact residents and real estate?
Why is the city council targeting gas stations?
The proposal is being promoted as both a housing and climate measure aimed at making more room for housing, increasing walkability and moving away from car-dependent infrastructure. Long and short, the Denver city council is using zoning to promote their social agenda. This is not the first time this has occurred and unfortunately doesn’t look to be the last time.
What is in the proposal to ban gas stations in Denver?
At the time of writing there were several proposals to prohibit/limit gas stations, below is a quick summary.
1.Total Cap: Limit the number of service station permits in Denver to 215, modeled after legislation passed in Louisville, Colorado. Denver currently has 180 operating stations.
- Buffer from Residential Properties: Implement a 300-foot buffer zone from residential properties, although no precedent was found in other cities.
- Buffer from Transit Stations: Establish a buffer zone from bus or light rail stops. This proposal had significant precedent and support from Denver’s planning documents as well as state bill HB 24-1313, which encourages density around transit stops.
- Buffer from Other Service Stations: Introduce a buffer zone similar to those in municipalities like Broomfield and Louisville, Colorado. The suggested buffer in the proposal was 1,000 feet.
- Stricter Use Limitations: Amend the Denver Zoning Code to restrict where gas stations can be built. This proposal would also likely be the mechanism for the future legislation regardless of which proposals were chosen as a text amendment to the Zoning Code is how this would be enforceable.
- Conditional Use Permitting Process: Implement additional criteria for permit approval or denial through the zoning administrator’s authority. This particular proposal may not require specific legislation as it could be done with CPD’s cooperation under existing department rules and regulations.
- Stricter Permitting: Change the permitting process from a standard zoning permit to a Zoning Permit with Special Exceptions (ZPSE), which carries significantly more onerous steps and allows CPD staff to consider things like environmental and quality-of-life concerns when reviewing permits.
Not the first time Denver targeting a particular business
Denver continues down a slippery slope. A few weeks ago, I wrote about a new proposal to ban any meat processing plants in Denver.
In 2024, Denver voters will be asked the following question:
“Shall the voters of the City and County of Denver adopt an ordinance prohibiting slaughterhouses, and, in connection, beginning January 1, 2026, prohibiting the construction, maintenance, or use of slaughterhouses within the City; and requiring the City to prioritize residents whose employment is affected by the ordinance in workforce training or employment assistance programs?”
Businesses are now leaving Denver based on the regulatory environment
Here are some interesting statistics from the Colorado Chamber of Commerce:
“This data is consistent with recent Colorado Chamber studies finding that our regulatory climate is driving business out of state. In our most recent annual business poll, almost half (46%) of Colorado business leaders said they will be making future investments out of state. When talking to companies that operate in other states, that number hits 83% — meaning only 17% of those companies intend to solely invest in Colorado.
When asked about the most important issues facing Colorado businesses, the answers were definitive: 48% of employers said regulations were their primary concern. Our pollster noted that our survey recorded the greatest concern about the state-level regulatory climate that he’s seen compared with other states where he polls.”
Long and short banning gas stations and other regulations is bad for business and businesses are taking note. In Salt Lake City the office vacancy rate is around 22%, Denver on the other hand is almost double hitting close to 40% in some submarkets.
Denver’s downtown core on a downward trajectory due to more regulations
The recent proposal to essentially ban new gas stations is par for the course with Denver county. As a result, Denver is becoming less competitive than any other mountain west cities and businesses are taking note. Denver has quickly gone from the darling city to the place people can’t leave fast enough. Unfortunately policies like banning gas station construction, banning meat processing facilities, and countless other rules/regulations coupled with high cost of living make Denver uncompetitive.
Based on this legislation I don’t see any changes happening anytime soon to make Denver more desirable for businesses which means that Denver will continue to lead the country in office vacancies and migration out.
Additional Reading/Resources:
- https://www.jdsupra.com/legalnews/denver-city-council-eyes-changes-to-1007013/
- https://coloradohardmoney.com/denver-will-vote-to-ban-one-business-in-the-city/
- https://gazette.com/opinion/perspective-colorado-has-fallen-behind-in-economic-growth/article_0bcbbdf6-bb8c-11ee-a436-530d0e5956f4.html
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Glen Weinberg personally writes these weekly real estate blogs based on his real estate experience as a lender and property owner. He is the owner of Fairview Commercial Lending. Glen has been published as an expert in hard money lending, real estate valuation, financing, and various other real estate topics in Bloomberg, Businessweek ,the Colorado Real Estate Journal, National Association of Realtors Magazine, The Real Deal real estate news, the CO Biz Magazine, The Denver Post, The Scotsman mortgage broker guide, Mortgage Professional America and various other national publications.
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