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In addition to decreased sales, supply-chain challenges, and coronavirus restrictions, outdoor brands and retailers are facing another obstacle brought on by the pandemic: potential eviction. In a lawsuit filed last week in Boulder County (Colorado), landlord Ten Eleven Pearl LLC sued its tenant Fjällräven for allegedly failing to pay rent at the outdoor brand’s downtown Boulder storefront. The suit asks for damages and property repossession.
According to an article on Denver website BusinessDen, the suit claims that from April through August, Fjällräven fell behind on monthly payments for the almost 4,000-square-foot space, owing a total of $88,760 in base rent and $38,261 in other charges. The Swedish brand, with U.S. offices in nearby Louisville, Colorado, and 30 other brick-and-mortar stores around the country, signed a seven-year lease for the site in 2016.
Ten Eleven Pearl manages the 175,000-square-foot mixed-use property, which opened adjacent to the Pearl Street Mall in 2016. The company declined to comment on the Fjällräven lawsuit and whether it is suing any other tenants. Outside Business Journal reached out to several people at Fjällräven for comment but has not heard back.
In March 2020 a group of 93 Boulder commercial property owners, representing more than 1,300 tenants, signed a resolution to refrain from eviction proceedings and to make case-by-case rent concessions during the pandemic. Ten Eleven Pearl was not among them. The city itself has not mandated that landlords provide commercial rent relief.
“Every situation is different,” says Chip (he goes by this single-word moniker), CEO of the nonprofit Downtown Boulder Partnership. “It wouldn’t make sense to do a blanket exemption. I’m hearing everything from property owners being really gracious and flexible to some that don’t have the ability to be so.”
He adds, “Nobody wants vacant buildings as long as they can avoid it. But a lot of it is the lender. At the end of the day, everyone’s got bills to pay. No one is making a big profit this year.”
Nonetheless, this type of lawsuit is uncommon in Boulder, according to John Tayer, president and CEO of the Boulder Chamber. “There’s no question these are challenging times for office and commercial space users and their property owners,” he says, “but we’ve seen many landlords go to great lengths to help their tenant businesses. It’s not like there’s a line of new businesses waiting to take their place.”
Quantified, the short-term effects of the pandemic on Boulder retailers are still pending. The year started off fairly strong; from January 1 through March 31, retail vacancies in the city measured only 4.4 percent of total available square footage, per numbers supplied by the chamber; data for the second quarter has not been released yet.
In the meantime, it’s business as corona-usual at Fjällräven’s Boulder store, which remains open daily, according to an employee. Some of the restrictions in place include required masks, a maximum of 18 shoppers at any one time, and guidelines for traffic flow. On June 20, the brand also opened a 6,000-square foot flagship store in downtown Denver that includes adjoining retail space for sister company Royal Robbins (both brands are owned by Fenix Outdoor International AG). A broker for Platte Fifteen, where the store is located, said Fjällräven is up to date with its rent there.
“Business has been pretty good,” says Steve G. the retail assistant manager who does not use his full last name. Both stores were planned well before the pandemic. “We’re coming into it with an open mind. It’s uncertain times.”