Denver Dairy Queen ends 55-year reign, sells for $1.4 million

Every summer for more than 50 years, Dairy Queen sold ice cream from a 710-square-foot shop at 2215 South Broadway in Denver.

That era is over. The longstanding DQ shut down in September 2019, and the property sold for a cool $1.4 million.

According to International Dairy Queen (IDQ) records, the location opened in 1964, making it one of the oldest in Denver. Longtime neighbors say there was an even earlier incarnation up the street that moved a block south.

The originator of soft-serve ice cream, DQ debuted in Joliet, Illinois, in 1940. It quickly emerged as a fixture of the country’s fast-food landscape. The adage, “There’s a Dairy Queen in every town in Texas,” denotes the durability of the chain, which has more than 4,000 locations in the U.S.

This kind of long-term success led Warren Buffet’s Berkshire Hathaway to buy DQ in 1995, but the number of stores has been on the wane for several years. On South Broadway in Denver, the distinctive red-and-white building has been for lease since fall 2019.

It’s a symbol of changing tastes, real estate trends — and an industry upended by COVID-19.

Steven Cook of Broadway Real Estate bought the property with his father, who also purchased used car lots and other properties along South Broadway. It’s part of a strategy that goes back decades.

“We focus on a super small niche right between I-25 and basically Hampden on South Broadway,” Cook says. “We’ve got about 28 restaurants and bars in that district.”

Creative reuse is part of the plan. A former antiques shop was converted into Grandma’s House Brewery, a local Mexican restaurant is expanding into an ex-Taco Bell, and a onetime 7-Eleven will soon become the fourth location of Bacon Social House.

With the restaurants have come offices and other businesses. “I’ve got a lot of people that have moved out of RiNo or downtown office space,” Cook says. Base rents in the area are comparable to what “triple nets and CAMs are in RiNo,” he adds. “They’re going to find more reasonable places that are still trendy and cool.”

The old DQ could contribute to that with, say, a cool, new ice cream shop, but it’s also a possible target for redevelopment. “On that block, we own the whole block except for one building right now,” Cook says. “So at some point, maybe there’s a deal to be had there, maybe not. But in the meantime, there’s a lot of good concepts.”

He adds, “I’ve had probably 75 phone calls on that one property. I’m just waiting for that right fit. We’ve got these cool, small mom-and-pops that we appreciate and we love and embrace, and that’s what Broadway’s all about. It’s not about big corporate tenants.”

When his father first started buying property on Broadway, “bankers thought he was pretty crazy, but he had a good vision,” Cook says. “When we started working together, our visions meshed well, and it’s finally coming to fruition.”

The tipping point might have been when Dave Query, founder of Boulder-based Big Red F Restaurant Group, opened the Post Brewing Co. in a former Mr. Steak across the street from the DQ as its fourth fried-chicken-and-beer location in 2017. The building, owned by the Cooks, had housed a continually revolving series of restaurants.

The Cooks “made a big effort to keep it local,” Query says. “It’s an area where — in large part due to the Cooks — they’re still willing to strike some deals with people.”

Query says rent would be “twice as much” for a similar building in RiNo. “They’re still making deals that allow for young entrepreneurs to get into business, which is really rare in Denver right now.”

It adds up to a colorful stretch of businesses, including numerous cannabis dispensaries, in an area formerly dominated by antiques, used cars and chain restaurants. “You know, they call it the Green Mile down there,” Query says. “I think the weed business has definitely had its effect on that zone. It makes it a little happier and a little easier-going.”

That wasn’t the case on June 15, 1988, when a twister touched down on South Broadway, causing millions of dollars in damage. At the time, Denver-based restaurant consultant John Imbergamo was marketing director for Mr. Steak at its 300-location zenith, including the restaurant the Post currently occupies.

The tornado “hit that Dairy Queen across the street,” Imbergamo says. “There was a giant inflatable cup — I think it was a Blizzard inflatable — that got picked up by the tornado and ended up somewhere else.”

It’s not a bad metaphor for the phenomenon occurring on South Broadway in recent years. “There were legacy chains that were doing very well before the pandemic hit, and there were legacy chains that had started to fade based on competition and innovation,” Imbergamo says.

Locally focused restaurateurs like Query are representative of that competition and innovation. He says he was eyeing the old DQ for a new donut concept from Big Red F, but that’s been put on hold with COVID-19.

Imbergamo says the pandemic has been a curveball for South Broadway and its restaurants. “There’s been a transition,” he muses, “but we don’t know what exactly is on the other side of that transition yet.”