The city’s love-hate relationship with the Guadagnoli’s nightclubs

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Sam and Kathy Guadagnoli

Sam and Kathy Guadagnoli

Sam and Kathy Guadagnoli have gained a reputation as one of Colorado Springs’ most creative, even fearless, dealmakers.

It’s no wonder: In the last 10 years, they’ve played a key role in remaking the city’s once-sedate downtown into a lively, diverse and busy destination.

While they’ve won much respect, they also have received some criticism. Some blame the Guadagnolis for helping create a downtown that they see as a rowdy, even dangerous club district.

The Guadagnolis acknowledge downtown’s problems, but argue that they’re often blamed for issues over which they have no control.

“The people who cause the problems, they’re not our customers. They’re not anybody’s customers,” said Sam Guadagnoli. “They’re just hangers-on, people who are on the street to cause trouble.”

Just how the community responds to the issues afflicting late-night downtown could have a profound consequence for the Guadagnolis, not to mention the owners of innumerable restaurants, bars and assorted boutiques and shops along Tejon, Pikes Peak and downtown’s other thoroughfares.

Already one club has had its liquor license revoked. Could the Guadagnolis be next?

Thriving business

Sam and Kathy Guadagnoli have owned and operated bars and nightclubs in Colorado Springs for nearly 40 years. Their entertainment venues have not only survived, but thrived.

Today, the couple owns or controls at least six downtown buildings, as well as many other properties in the Pikes Peak region and elsewhere. They operate two mega-clubs (Cowboys and Rum Bay) and four smaller establishments (Level 360, the Red Martini, Blondie’s, and Gasoline Alley), all concentrated in a single half-block area on Tejon.

The exact extent of the Guadagnolis’ holdings is unknown, concealed by an opaque network of LLCs and partnerships. The Business Journal estimates that they have invested more than $15 million in their downtown properties, and that their bars and clubs generate annual cash flows in the low- to mid-seven figures.

The couple’s profile rose after they launched their first mega-club, Rum Bay, which opened 10 years ago after the Guadagnolis bought, gutted and renovated a former Woolworths at 20 N. Tejon.

In visits to cities ranging from Austin to Los Angeles, the couple had noted that nightclubs were often clustered in 19th-century warehouse districts, where vacant commercial buildings provided affordable space and, when remodeled, an attractive atmosphere for patrons.

“What you want in a club district,” said Sam Guadagnoli, “is a lot of places together, with easy parking, in a safe part of town, a destination like a mall, not just one or two clubs.”

To the extent that such buildings existed here, they were in downtown’s heart. For more than a century, that heart had been occupied by banks, department stores, upscale restaurants and long-established retailers. But many of those tenants had departed, leaving vacant, functionally obsolete structures in the city’s historic center.

Real estate investor and consultant Les Gruen of Urban Strategies credits the Guadagnolis for seeing what no one else saw, and taking risks that no one else would take.

“They saw that there was space available at a very low price that could be renovated to fit their needs,” he said, “and they took what was there, and created a club district.”

The Guadagnolis were also well aware of two quirky city ordinances that would help their business grow. First, central downtown is a “parking-exempt” business district, which doesn’t require businesses to provide parking for their patrons. That saved them lots of money. Moreover, admission charges to nightclubs are not subject to sales tax, so that’s one less headache for them.

Fashioned into five interconnected clubs, Rum Bay was an immediate success. Two years after buying it, the couple acquired the former Colorado Springs National Bank building across the street and opened a second mega-club, Tequilas, in 2003.

On most weekends since, Tejon is awash with young revelers. And on a typical weekend, as many as 5,000 customers passed through the doors of Rum Bay and Tequilas, each paying $5 to be admitted.

As might be expected, some of those younger folks occasionally drink a bit too much and get into trouble.

During 2007, the two largest Guadagnoli clubs were the source of nearly 600 police calls for service, far more than those to any other two locations in the city.

The problems made headlines in January of 2008, when a fight involving more than 30 men broke out at Tequilas’ successor, the Vue. When police arrived, they were confronted by a hostile, uncooperative crowd of 200-300 people on the street.

Response to Violence

The Guadagnolis reacted quickly. The next day they closed the club, re-opening it several weeks later as a downtown version of Cowboys, a country-and-western club that they had operated for many years on Academy Boulevard.

“We closed it (Vue) because of the fight,” said Sam Guadagnoli. “I don’t want to say anything bad about anybody, but when (another club) Eden shut down, that same crowd came to the Vue. We saw the problems, and we’re like anyone; you gotta protect your assets.”

To do so today, the Guadagnolis pay the city $8,000 a month to defray the cost of additional police on Tejon.

“The rest of the operators on Tejon don’t contribute,” Guadagnoli said. “They say it’s our problem.”

Guadagnoli doesn’t agree with the sentiment, but he has also adopted a pragmatic approach.

“It has to be safe and fun downtown or nobody will come, and that’s why we pay the cops. It’s in everybody’s interest, especially since the city’s so strapped, so we’re glad to contribute. No one has more to lose than we do.”

In the meantime, more recent police records show that calls for service originating from Guadagnoli-controlled clubs remain high. From the beginning of this year through mid-March, there have been 139 calls for service from Rum Bay, Cowboys and Gasoline Alley.

The statistic, said Sam Guadagnoli, is bogus.

“It includes everything that happens in our block, whether or not we’re even open,” he said. “If a bum passes out and gets picked up by an ambulance at 10 a.m., or there’s a fender-bender, or a speeding ticket, the cop just writes the location. We’re the landmark, so we’re the location.”

Police confirmed that in a lot of cases, Guadagnoli’s point is correct.

As one undercover vice and narcotics officer put it, “(Sam) does a pretty good job of controlling his door, enforcing a dress code, and keeping everything together.”

Ideas for improvement

The Guadagnolis believe that downtown can be improved by some simple measures.

“We need to have linked I.D. systems,” said Sam, “so that if somebody gets thrown out of the Ritz, they can’t just go to the next club.

“We think that all the bar and restaurant owners ought to help pay for enhanced police protection, not just us.

“Also, the law here says that we can’t hire off-duty cops to provide security inside the club in uniform, (but) that’d be helpful.”

The Downtown Partnership, a group that represents the interests of businesses downtown, is exploring other steps including staggered closing hours so that all the bars don’t shut down at once at 2 a.m.

Whatever happens, Jerry Rutledge, who owns an upscale men’s clothing store on Tejon, would like to see Rum Bay — which is less than a half block from his doors — stay in business.

“I’m glad they’re here,” said Rutledge of the Guadagnolis. “They bring people downtown, and even though you’d think those folks aren’t my clients, you’d be surprised. I get lots of customers through them. A girl might see something in the window and tell her Dad, or her brother, he comes in on Monday, we make the sale.”

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9 Responses to The city’s love-hate relationship with the Guadagnoli’s nightclubs

  1. Sam had guts enough to invest in the downtown area. Without him, the city could just send someone downtown at 5pm to shut off all the lights and re-open at 8 each morning. When the area comes up with leaders at the city level, perhaps he can continue to develop his plans to revitalize the area of Nevada and Tejon into other than a hangout for hookers and drunks.

    Rick Wehner
    March 26, 2010 at 11:22 am

  2. Sam is right. a lot of sevice calls come from nonrelated events, This is a fact! As much as i dont like to say it, Chuck Shafer does a good job with security and so does Tim at cowboys. Other Huge cities alow off duty cops to moonlight and from first hand experience it makes a world of difference. letting out the bars at different times will really do nothing. There will always be fights in and outside of bars. I have noticed here that people refused entry will hang around outside fuming and looking for a fight. The bottom line is this, stop going after the bar owners and go after the ones causing trouble. make no mistake that there are groups that plan to go out find a person and beat them no matter who the bar belongs to.

    Ken
    March 26, 2010 at 11:59 am

  3. I won’t go downtown to the bars anymore. Its too wild and crazy. Sam should reconsider his old Cowboys location at the former Rack n Tap on powers or even the older Palmer Park and Academy location, that location needs to be torn down and rebuilt, of course.

    Brian
    March 26, 2010 at 9:32 pm

  4. Perhaps the bar owners should seriously consider having some type of clean-up crew after hours to hit the streets and alleyways around their clubs. It’s terribly difficult to promote our city when you are constantly dodging vomit on the sidewalk on the way to breakfast in the morning.

    Kelly
    March 27, 2010 at 2:59 pm

  5. Once upon a time, a gentleman railroad tycoon gave the land to Colorado Springs to build a high class city. The gentleman railroad tycoon had a lot of wisdom. He had learned what is good for the human race and what is bad for us.

    He put a restriction on the deeds. No alcohol.

    His wisdom has been proven. Over and over again. Ask any Judge. They will tell you. 85% of all the cases in court are involved with drugs and alcohol. 85% of all wife beatings, assaults, bar fights, shootings, etc. Present day wisdom is the premise of this generation. Sam and his clubs is what we need more of. Want an 85% reduction in the cost of Police, prisons, etc. Get rid of alcohol.

    Sam and his string of quasi-strip clubs/dives/ and bars are certainly the answer to “improving downtown.” Sure. Businessmen who prefer dirty profits over quality of life ALWAYS want to lower the quality of life and transfer the costs of their business to others. As the downtown has fallen for bars and strip joints, the sales tax revenue has fallen to less than 2% of city revenues.

    If society put the true costs of these businesses back on them as taxes necessary to repair the damage they cause to society, they would go out of business in an hour. Meanwhile, we all subsidize this crap through taxes to build jails, employee extra police, and so forth. Meanwhile, Rum Bay is so uplifting. Yeah. Right.

    Do you suppose the “police service calls” to the old Cowboys location went down after they moved downtown? So much for this crap about Rum Bay not being part of the problem.

    FactFinder
    March 28, 2010 at 7:04 am

  6. Thanks to the Guadagnoli’s my business has been able to successfully attract and retain young professionals who want to live and work downtown. My new employees came here from Boston, Seattle, LA and Atlanta… and stayed after experiencing the nightlife downtown. The talent I’ve been able to hire from major metropolitain areas has significantly increased what we can offer to our clients. Our new young professionals are now making Colorado Spings their home, buying houses, raising families and paying taxes here. Your business is fueling my business and my business is thriving. If people don’t like the alcohol, there are places far, far away they can move. Oh, and if the bars are looking for a solution for an inexpensive linked id system…why not just text alerts from bouncer to bouncer with the name on the ID of the offender?

    Young professional
    March 29, 2010 at 7:44 pm

  7. Sam is a jerk and his clubs polute our downtown. What has Sam done for our community? He gets filthy rich off of our GIs and puts nothing back into our military or our community. One of these days he’ll get busted for all of the drugs passing through his clubs and we can rebuild downtown and put something of value in place of Scum Bay. Perhaps a parking lot.
    I’d say move Scum Bay to revitalize Citadel Crossing but it’d be better if Sam just went away.

    Trevor D
    March 29, 2010 at 9:54 pm

  8. I no longer go downtown in the evening because of the security risks, personally and to my property. I do not eat or attend events, such as the symphony, because of the risks.

    Bill
    March 30, 2010 at 5:07 am

  9. I think it is appalling that just because he DOES pay the cops, he is allowed afforded leniency with not controlling his patron’s activities. The same things happen at his bars as at other bars…underage drinking, brawls, overserving, etc. Yet, he has yet to ever be held liable for these actions. Meanwhile, other clubs are continually brought before the City’s Liquor Board…receive suspensions and revocations. I’ve seen firsthand what goes on in many of the clubs, and how security in those clubs handle the problems. I don’t see much difference between them, and yet specific clubs get singled out…and harshly punished. Is it just coincidene that those happen to be the clubs that DON’T PAY THE COPS?
    All Downtown clubs pay higher rent / mortgage, higher property taxes, etc. I’ve seen firsthand what I believe is the turning point….when cops refuse to help BECAUSE they don’t get ADDITIONAL fees from bar owners. What makes Sam’s employee’s lives worth more than an employee that works at another club…I guess the money that goes into the cop’s pockets. Any employee who works for a club that CAN’T AFFORD to pay the cops is just out of luck I guess. Out of luck when they are getting their butt kicked and the cops refuse to help. Out of luck & out of a job when the Liquor Board punishes them
    for the same exact situation because getting their butts kicked with no help from the cops still was not good enough to make the city happy.
    I am happy for Sam that he CAN afford to pay the cops. I am happy for his employees because it
    keeps them safer…and employed. However, when the cops eventually expect this additional payment
    to do a job that they are ALREADY PAID to do, a place is screwed if they don’t cough it up. NO BAR
    intentionally let’s bad things happen….BAD PEOPLE make them happen. Sam & the rest of the bars are
    just trying to make a $$. But if you happen to be lucky enough to be able to afford to pay the
    City / Police “Fees”, it should NOT afford you favoritism when the same bad things happen to you that happen to all the other bars around you. Fair is fair….bribery is illegal. Not accusing…just saying.
    Oh, and by the way…all those cops that get extra pay to sit in front of Sam’s clubs…where are they
    when YOU need help?
    If Sam is truly about just making sure he, his staff, his property, & his patrons are safe, then hire a
    security COMPANY…not cops that have direct influence over the City, the Liquor Board, and the
    actions of the Liquor Board over his bar and OTHER bars.
    Once again…NOT ACCUSING…JUST SAYING.

    anonymous
    April 3, 2010 at 1:06 am