COLLATERAL DAMAGE: Aurora bars and restaurants among the casualties in the fight against the pandemic

For Myron Melnick, the Zephyr Lounge wasn’t just a Colfax dive bar. It was a living, breathing thing. 

“It’s a mosaic of all kinds of people, and that’s what we had at the Zephyr,” Melnick said. “The world was in the Zephyr.” 

By October 2020, the 73-year-old establishment situated on the corner of East Colfax Avenue and Peoria Street had endured seven months of the COVID-19 pandemic. For about three of those months, the Zephyr couldn’t serve customers at all. Melnick was finally able to invite patrons back to his haunt last summer, but not for long. The bar had become a place devoid of the live music normally drawing crowds. Customers would nurse a single drink for too long, Melnick said, and staff had to constantly remind patrons to wear masks. 

Since Melnick’s father opened the Zephyr in the late 1940s, the watering hole weathered the specter of nuclear war, capital flight from East Colfax Avenue and several deep recessions.  

No longer. Melnick said he received a “great” offer on the bar’s 2-acre parcel last year. A development company plans to erect about 400 apartments there, he said — just a stone’s throw from the booming Anschutz Medical Campus. 

“It was time. I’m getting old, and we were there 73 years,” said Melnick, who is 68. “I hated to have to close, but the writing was kind of on the wall.”

And so went one of the last vestiges of a bygone Aurora. 

The Zephyr was far from the only local institution that heard its swan song in 2020. The lounge was one of 3,051 Aurora businesses to close shop last year, according to the city data.

Among the commercial casualties were some of the most venerable anchors of the city’s peculiar and semi-suburban nocturnal commercial landscape, including the Night Shift Saloon on Peoria Street, The Kasbah Nightclub on East Sixth Avenue and Whisper’s on Havana Street — all of which were located in strip malls. The latter was one of 19 business closures on Havana alone. 

Bars and restaurants across the state are still grappling with the current stasis, according to Sonia Riggs, president and CEO of the Colorado Restaurant Association. Through a spokesperson, Riggs said that staffing levels at Colorado eateries are still down by a third, and 40% of restaurants report that they’re in jeopardy of closing within the next six months. 

Though industry analysts like Riggs are expressing cautious optimism thanks to reduced capacity restrictions, the prevalence of vaccines and the onset of outdoor dining season, restaurant revenues statewide remain down some $3 billion year over year. 

Marchia McGilley, executive director of the Aurora-South Metro Small Business Development Center, told the Sentinel that many business owners were simply sandbagged by what she called a countrywide “economic disaster.” 

If a business wasn’t able to tap into a rainy day fund, quickly receive government rescue dollars and invest in new ways of selling wares, they were more likely to fall by the wayside, she said.  

But Aurora’s economy weathered the pandemic better than some of its neighbors, city officials have said, in part due to residential sprawl and in part because of recently passed municipal legislation. 

There were in fact fewer business closures in the city last year than in 2019, according to Trevor Vaughn, head of the city’s tax and licensing division. Vaughn said the effects of the pandemic were critically damaging for bars and large event spaces that depend on alcohol sales, but far less so for the umpteen accountants, insurance agents and other professionals who merely pivoted to working from home. Those professionals sequestered to their suburban plots were likely a boon for city coffers, according to Vaughn, who said people getting lunch around their ad hoc home offices kept money in the city instead of gushing it into Downtown Denver or the tendrils around the Denver Tech Center. 

“Aurora has maybe a more balanced residential makeup with retail,” Vaughn said. 

Kevin Hougen, president of the Aurora Chamber of Commerce, echoed Vaughn’s hypothesis by highlighting the notion that suburban economies like Aurora’s are rebounding faster than their counterparts tied to large urban centers.  

“From Manhattan to San Francisco to Downtown Denver, big companies are not returning as fast as they are in the suburban marketplace,” he said.

The numbers corroborate Aurora’s resurgence. Sales tax figures were remarkably up more than 5% last year, according to Bob Oliva, senior manager of commercial development with the city. In the holiday-crazed months of November and December, tax revenues were up by some 13% over 2019, according to municipal budget analysts. Revenues have been so much rosier than originally anticipated, the city recently shelved plans for three additional furlough days that were planned for municipal employees for 2021. The last unpaid day of austerity in the city occurred April 16.

That’s due in large part to a new ordinance passed last summer that requires online retailers like Amazon to remit sales tax via third party vendors. The city saw a 360% spike in sales tax revenues when the new measure took effect in August. 

“The biggest savior of Aurora sales taxes was the online sales,” Oliva told a panel of city council members earlier this month. “We started getting the online sales tax dollars about halfway through the year when the new online facilitator ordinance went into effect. This was a game changer and saved our tax collection.”

The home improvement sector proved to be a particularly fruitful sales tax generator, according to Oliva, who said residents working from home spent an average of $504 to upgrade their residential offices. That prompted a particular spike in sales tax revenues from August through November. 

Despite the somewhat sanguine economic picture painted by those recent figures, the true fallout of the pandemic may not be felt for years, according to Vaughn. 

“Impacts to a business financially can take a period of time before those pan out,” he said. “It may be a couple years before the business actually closes. I think we could see closures because of the financial strain of the pandemic over the next few years.”

Indeed, early licensure data from the first quarter of 2021 do not bode well for the local economy. At the current rate, annual business closures are set to be up 25% compared to pre-pandemic levels, and new business licenses could be halved in comparison to 2019.  

And while employment figures for the state’s wealthiest residents —those making more than $60,000 per year — are as robust or stronger than they were prior to the onset of the pandemic, job figures for the poorest Aurorans remain dismal, data show. 

Statistics compiled by Harvard and Brown universities show that employment is down some 16% among Coloradans who make less than $27,000 per year. In Arapahoe County, the largest of the city’s three-county hodgepodge, employment for those in the lowest-earning bracket is down more than 24% when comparing February 2020 to the same month this year. 

Staff at the Aurora-South Metro Small Business Development Center saw “exponential” growth in their work to help keep businesses open and employing workers. McGilley and her team remain busy helping business owners weather the continued uncertainty. 

A part of that: Forcing owners to plan for more worst-case scenarios.

Without the Zephyr, Melnick returned to his roots as an artist. He works now in a studio in Denver’s Five Points neighborhood where he crafts large, “abstract” origami-like creations from paper.

Before his afternoon session in his art studio on April 20, Melnick said the pandemic proved to be the straw that broke the camel’s back for so many small businesses in Aurora. He said he had trouble hiring workers even before COVID-19 entered the cultural lexicon. Minimum wages have marched up, he noted, and it became impossible to negotiate good liquor and beer prices with enormous companies. 

But he’s hopeful that new businesses will continue to pop up in Aurora, especially near his beloved stretch of East Colfax Avenue. He said that, with the right planning, Aurora visionaries can revitalize the region. 

In the meantime, the scope of the long-term economic fallout from the pandemic remains ambiguous, according to Greg Hays, budget officer with the city. 

“Aurora did better than what was projected, but we’re still unsure about the future just because nobody has been through this before,” he said. “There’s a lot of uncertainty about what it’s going to look like for Aurora specifically when this is all said and done.”