After 10 years on Colfax, John Wallrath is saying adiós.
The owner of Machete Tequila + Tacos will serve its last margaritas Saturday at 3570 E. Colfax Ave. in Denver, he told BusinessDen. He chalked up the closure to the spot’s lease expiring at the same time construction crews are building a bus rapid transit line down the middle of the corridor.
“There’s just no upside right now,” Wallrath said of running his taco joint amid construction. “We appreciate what’s going on with the city and the attempt to beautify the area, but it just didn’t work for us.”
Wallrath, who opened the 4,000-square-foot spot in 2016 with Dan Ohlson, said that energy shifted in late 2024. That was around the time BRT construction started farther west along Colfax; work didn’t start in front of Machete until months later. He said people perceived the area as difficult to traverse and parking as hard to find.
Pre-pandemic, patrons would come to Machete before and after concerts to enjoy the spot’s outdoor patio, “really heavy” pours and Mexican street-style tacos, Wallrath said. That enabled 10% annual growth in its first five years.
But the pandemic and ensuing construction changed that. After a spike in sales in 2022 and 2023, Wallrath said business has been down 70% over the past few years.
Wallrath said he tried to negotiate with his landlord to work out a better deal and sought clarity from the city government on construction timelines, but didn’t get enough answers to re-up his lease.
“We did exactly what we had to do. Our hand was forced,” he said. “You can’t lose money trying to do what you do when there’s nothing coming to improve revenue.”
Wallrath also has profitable Machete locations in Cherry Creek (opened in 2011) and Union Station (2014), which made the decision a little easier to swallow. Those will remain open, he said. He just re-upped his Union Station lease.
Machete also had a stand at Red Rocks Amphitheatre last year, and Wallrath said he’s in talks to operate there again this year.
“Colfax was a player until it wasn’t,” Wallrath said. “Cherry Creek and Union Station are equals and both make a nice profit. Union Station is probably a bigger volume, but because of our situation in Cherry Creek, we might have a little more profit because we own the building.”
He didn’t rule out opening another Machete outpost in Denver, especially because many of his employees are younger. Nothing is imminent, though.
“We’re definitely disappointed,” Wallrath said. “But as business owners, you only go into business with a horizon in front of you that you know and understand.”
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