Five Points businesses battle with billionaire-linked landlord at Flyfisher Group
A handful of Five Points tenants have turned against their billionaire-linked landlord.
Multiple businesses that lease space from Denver-based The Flyfisher Group say the firm and its CEO Matthew Burkett is burdening them with bogus charges and attempting to wrest control of their operations while Burkett publicly portrays himself as a force for good.
“What is extremely upsetting to me is the decimation of our neighborhood, bottom line,” said Ryan Cobbins, owner of coffee shop Coffee at the Point and a former Flyfisher employee.
Five Points, particularly the Welton Street corridor, is the historical heart of Denver’s black community. Burkett is black, as are all the business owners who spoke on the record to BusinessDen for this story.
Flyfisher has done business with Robert Smith, a Denver native who is the richest black man in America — worth an estimated $6.7 billion, according to Forbes.
The comments from Cobbins and other business owners come in the wake of a string of lawsuits filed against them by Flyfisher entities. The statements provide context for the shuttering of Welton Street Cafe, a Five Points institution that recently moved out of a Flyfisher-owned building.
“I still don’t understand why we’re not in our space anymore,” cafe owner Fathima Dickerson told BusinessDen.
Burkett declined to be interviewed. In a statement, he said the lawsuits were a last resort.
“Just like any other property owner, investor or asset manager, when mutually agreed-upon contract terms are broken with no remedy in sight, we need to be able to take appropriate action to gain compliance,” Burkett wrote.
Flyfisher has spent at least $12 million since 2018 to buy buildings in a two-block stretch of Welton Street. Four of 11 buildings owned by entities linked to the firm are currently listed for sale, CoStar records show. Buildings for sale include those that house MBP, a restaurant owned by FlyFisher, and On Point Beauty Bar, which is owned by Burkett’s wife Priya.
Cobbins and others said their relationship with Burkett and Flyfisher has taken a turn for the worse in recent years in part because Burkett and Smith had a falling out.
They said that is why Burkett has been doing something that most landlords don’t — asking his tenants to sign “operating agreements” that give him an ownership stake in their business and a final say in decisions.
“A man that’s supposed to prop up businesses and support them utilizes leverage as a landlord for people to sell him shares of the business and then create operating agreements, where he’s a minority controller of the business,” said Chuck Jones, co-owner of Agave Shore, a restaurant that leases from Flyfisher. “And if you don’t do business that way, he finds ways to get rid of you.”
Burkett said in his statement that he personally — not Flyfisher — is the one investing in the businesses.
Burkett didn’t respond to a follow-up question regarding he and Flyfisher’s affiliation with Smith, and whether it had changed. A source close to Smith told BusinessDen that the billionaire “has done business with The Flyfisher Group and with Mr. Burkett in the past, though his business dealings with them have decreased in recent years.” He said that Smith has never owned a stake in Flyfisher or had any management role in the firm.
Burkett: “We want to create fertile soil for new entrepreneurs”
The FlyFisher Group was founded in 2010, according to its website. In a panel discussion convened by the Downtown Denver Partnership last year, Burkett positioned himself as someone supporting businesses in Five Points.
“We want to create fertile soil for new entrepreneurs to come and be able to thrive,” he said.
Burkett does have defenders among FlyFisher’s tenants.
Courtney Samuel, a former college cornerback and founder of the Bodies by Perseverance gym, signed a lease for his 3,000-square-foot space at 2860 Welton St. in 2018. He signed an operating agreement with Burkett, who was also a client, that included a full build-out of the space and a $30,000 investment for a 40 percent stake of the personal trainer business.
Samuel said sales have quadrupled since moving into that space, and the last four years of business have been the best since starting the company in 2003.
“Numbers don’t lie,” Samuel said. “I went into this business relationship looking for a business mentor, and Matthew has fulfilled that and more, as far as showing me how to run and operate my business, deal with finances, and show me different things to make me think and grow. It’s a big part as to why I feel our revenue numbers have been where they are.”
Flyfisher is a partner with Palisade Partners in the long-planned redevelopment of the shuttered Rossonian Hotel at 2650 Welton St., a local landmark that once had a prominent jazz club.
Palisade Director of Finance Tim Welland told BusinessDen that redevelopment efforts were affected by COVID but are still progressing, and that physical work could begin next year; he noted Palisade is not involved with the other properties that Flyfisher owns.
Burkett’s personal website describes him as a philanthropist and “professional globetrotting fly angler.” Born in Denver and raised in Evergreen, he moved back to Denver in 1996 after lobbying for a telecommunications firm in Washington, D.C. and ran a property-services company in Five Points, according to the Denver Business Journal. Colorado Homes & Lifestyle magazine did a feature last year on the 14,000-square-foot mansion where Burkett lives with his family.
Burkett sits on a number of boards and committees, including the Federal Reserve Bank of Kansas City’s economic advisory council and Visit Denver’s board of directors.
It’s not fully clear how Burkett became close to Vista Equity Partners founder and CEO Robert Smith, who in recent years has made headlines for both pledging to pay the student debt of a Morehouse College graduating class and for evading taxes.
In 2007, Burkett and Smith co-founded Lincoln Hills Cares, according to the nonprofit’s website. The organization offers outdoor recreation and education opportunities to youth who might not otherwise be able to have those experiences, taking them to Lincoln Hills, an area in Gilpin County that was the sole black-owned resort in the region during the height of segregation. Burkett is the founder of the Lincoln Hills Fly Fishing Club.
Cobbins and the others want Smith to publicly separate himself from Burkett.
“We don’t think Robert is pushing Matthew’s buttons to do this,” Jones said. “We just think he has a wicked asset manager. We want to push pressure on Robert to get rid of Matthew.”
The source close to Smith told BusinessDen he’s aware of the concerns regarding Flyfisher.
Agave Shore owner: “His mask has fallen”
Cobbins, who opened Coffee at the Point at 710 E. 26th Ave. in 2010, said he has been friends with Burkett for the past 10 years, but things have changed recently.
“In the last couple of years, his mask has fallen,” Cobbins said.
In 2020, Flyfisher announced it was launching a food and beverage group called Pure Hospitality, which would invest in existing restaurants along Welton Street and launch new ones like Mimosas and MBP. Cobbins was named as one of three individuals running the new group.
One of the businesses that Pure Hospitality invested in was Coffee at the Point. According to Cobbins, Burkett paid $28,000 for a 40 percent stake in the coffee shop, and agreed to pay him $75,000 a year for the Pure Hospitality role.
The agreement also called for at least $200,000 to be spent remodeling the coffee shop, according to Cobbins, who said it was his understanding that Flyfisher would pay for it.
Cobbins said the first change that Burkett wanted was a new speaker system for the shop, and that Burkett approved an $8,000 quote. But when the bill came, Cobbins said he ended up paying.
It was one of many red flags for Cobbins, who said that a short time later, he and Burkett decided to dissolve the partnership. But last month Burkett filed a lawsuit in Denver District Court against Cobbins, claiming he had breached their original agreement.
“He wants the $28,000 back with interest, but he’s already gotten more than his money’s worth with what I’ve done for him,” Cobbins said. “I’m talking about waking up at 3 a.m. three times a week because the alarm is going off or somebody’s breaking into Mimosas, or the pilot light was on in the oven, plus the $8,000 I spent on Coffee at the Point’s speaker.”
Cobbins, who is also the president of the Five Points Business Improvement District’s board of directors, said he had hugged Burkett three days before he was served the lawsuit, telling him he missed him. But with a pile of attorneys’ fees to sift through now, Cobbins feels deflated.
“What Matthew did to me is the fear I hear on our Business Improvement District calls on a weekly basis with our elders saying we don’t want these other folks coming in because they’re going to screw us all over, work to evict us, and gentrify us,” he said. “Well, we got gentrified from within this time.”
Get Busy Livin Studios owner: “It almost completely took me out”
Mike Millard said he signed a lease in September 2020 for 3,000 square feet in a building that FlyFisher owns at 2736 Welton St. called Five Points Plaza, which Flyfisher bought for $6 million in 2018. In January 2021, he opened Get Busy Livin Studios, a studio for everything from photography to recording music.
“The unit he gave me was used as a squatting spot because it was vacant during COVID,” Millard said. “There were homeless people staying there before I went in there. It wasn’t up to code, and there was urine and feces everywhere. So, I had to hire a professional cleaner which I was never reimbursed for.”
Millard said he spent upward of $45,000 to renovate the space, including adding a soundproof booth, laminate wood flooring, new toilets and updated wiring.
“There were plumbing and electric issues and because I wanted to get up and running and operable, and they weren’t coming through, I just had to get it done myself with the understanding that I’d be reimbursed,” he said. “But obviously, I never did.”
Millard said that, not long after he moved into the space in September 2020, Burkett sent him a bill for around $50,000 for common area maintenance fees for the whole year of 2020, even though the space had been vacant for the first eight months.
When Millard met with Burkett to discuss the situation, Burkett presented an operating agreement to Millard as a way to get out of the fees.
He also took a 15-minute phone call in the middle of the conversation to discuss a large sum of money with someone else, Millard said.
Millard said Burkett first offered to purchase a 51 percent stake in GBL Studios, but when Millard turned him down, he changed it to 40 percent. But the agreement would have given Burkett the final say on decisions.
“I said, ‘hell no,’” Millard said. “But then, as soon as I turned him down, they started pressuring me, and I began receiving crazy invoices and bills.”
Millard said he received bills for thousands of dollars in monthly expenses for things such as landscaping, despite the fact that there is no greenery on the Five Points Plaza property, only a parking lot. He also said he was splitting a $12,000 a month fee for security with other businesses in the plaza.
“The security was outrageous,” Millard said. “It was one guy who would come around drunk all the time, who was living on the property in a vacant unit with a blow up mattress and mini fridge, and we found out later that that’s how he was being paid.”
It came to a point where Millard couldn’t afford to operate there anymore. He terminated his lease and left the space in September 2021 after a year.
“They basically intimidated and coerced me to be able to file the termination of lease agreement with the understanding that I owed them an outrageous amount of $82,000, but they said they were willing to settle it for $25,000,” Millard said. “At that point, I didn’t care anymore. That was a good deal for me. I just wanted out. There’s no way I could afford to pay them these outrageous amounts, especially in a COVID climate.”
Millard has relocated his business to 1400 Oneida St. in the Montclair neighborhood, and said he had to go back to work in the corporate world to support himself and his fledgling business.
“On top of all the money I had invested into opening this space, I lost a ton of clients when I relocated because the Five Points area was convenient for them,” Millard said. “I also had to redo the construction all over again and rebuild the business from the ground up. I am pretty freaking resilient, so I was able to save my business, but it almost completely took me out.”
Millard agreed to pay FlyFisher $25,000 in increments over a period of time just to get out of his lease. He said he never planned to pay them because he had already lost enough money and planned on suing Burkett.
“But he beat me to the punch,” Millard said.
On March 14, Burkett filed a lawsuit against Millard through an entity associated with FlyFisher, alleging he had breached the contract and was in default on the payment.
“They know how hard I’ve been working all these years. So, for somebody like Matthew to come in and do this to people because he has money and power is not right,” Millard said.
Agave Shore owner: “He’s a crook”
With a combined 40 years of hospitality experience, Chuck Jones and LeJon Vivens started VivJo Hospitality Management & Consulting in 2019.
Jones said they were brought on by Burkett to consult on a number of projects, including FlyFisher’s restaurants Mimosas and MBP, as well as the Rossonian and a possible transformation of the Five Points Plaza parking lot into an amphitheater that never came to fruition.
Last year, Jones, Vivens and business partner Latasha Eugene opened a taco and tequila bar called Agave Shore in Flyfisher’s Five Points Plaza.
Jones and Vivens said that, not long after, Burkett presented an operating agreement to them, offering to buy first a 40 percent and later a 30 percent stake in the business for $40,000 as long as he has final say on any decisions. They declined.
“Think about this. He hired us for his own restaurant group to be consultants,” Jones said. “Why the hell would we give you control of our restaurant if you don’t know what you’re doing? He wanted to be our partner to receive all of the credits and have none of the liabilities.”
That’s when Burkett’s sunny demeanor changed, as he did with other tenants.
“We did a patio expansion and took out a dead tree,” Vivens said. “When he thought he was going to do business with us, he’s there with us telling us we should make it look like a beach. When we said we don’t want to do business with him, he said the patio was approved illegally.”
On Feb. 14 this year, Burkett filed a lawsuit against Jones and Vivens, claiming Agave Shore had failed to pay rent on a timely basis, as well as common area maintenance charges. In a letter to Flyfisher prior to the filing, Agave Shore acknowledged it had been late on rent but said that the business had recently made payments and was caught up. The business said that the maintenance charges in question dated to 2019 and 2020 and should have been paid by a previous tenant.
The lawsuit was settled March 31, Jones said.
“I want to force a separation between him and this myth that he’s our savior,” he added. “He’s a crook.”
Welton Street Cafe owner: “We were threatened with eviction almost every day”
In the midst of these disputes, Welton Street has lost an anchor tenant.
Welton Street Cafe, which opened in 1986 and operated in Five Points Plaza for 22 years, closed its doors on March 12.
Fathima Dickerson, who runs the business with her family, said FlyFisher kept the soul-food restaurant on a month-to-month lease since it purchased the property in 2018, and that the business was unable to negotiate an extended lease.
“We were threatened with eviction almost every day,” she said.
During their time in the building, Dickerson said FlyFisher did not complete needed HVAC repairs. The business started a GoFundMe campaign to raise the money to get the work done.
Welton Street Cafe is looking for a ghost kitchen space where it can prepare food for takeout and delivery for a few months, and hopes to open elsewhere along Welton Street, in a building not owned by Flyfisher later this year.
Cobbins said the situation is affecting the whole corridor.
“I can imagine all the people that aren’t coming down here because Welton Street Cafe’s not open,” he said. “And those people would stop by Agave Shore or Coffee at the Point to say hello. But now, they’re not coming.”