Former Buddy Boy Dispensaries Getting New Tenants

At least four storefronts formerly occupied by Buddy Boy dispensaries could again house pot shops now that the marijuana chain's ownership has settled with state and city tax officials.

Once one of Denver's largest dispensary chains, Buddy Boy opened in 2014 and eventually expanded into seven dispensaries across the city. In June 2022, however, Buddy Boy ownership abruptly announced it was closing all stores because of declining sales — but the closures were soon "expedited" by the Denver Department of Finance over unpaid sales taxes.

According to the department, Buddy Boy owed an estimated $500,000 in back taxes. At the time, owner John Fritzel blamed the steep decline in sales for the failure to pay and said he hoped government officials would allow him to sell his marijuana licenses in order to raise the funds to pay the bills.

"We've got active sales contracts. Selling one store should be able to pay for all of this and then some. If their main concern is to get paid, that would be no problem," he told Westword. "The goal here is to definitively satisfy what we owe, same for our landlords and vendors. Our goal is to get that taken care of, and in order to do that, we need to move those licenses."

Over a year went by, though, and the old Buddy Boy stores remained empty. But after settling with the Colorado Department of Revenue this summer and recently coming to an agreement with the Denver finance department, Fritzel appears to have started moving on from his old Buddy Boy stores.

Denver Department of Excise & Licenses records show pending marijuana license transfers for two former Buddy Boy stores, at 3814 Walnut Street and 4012 West 38th Avenue, to a business called Canna Club LLC, and another pending marijuana license transfer to the Sloth LLC at 4600 Ironton Street.

One former Buddy Boy location, at 2426 South Federal Boulevard, has already been sold, with the transfer approved by the city in September. That spot recently reopened as a new dispensary, Green Sativa, which has another store in Federal Heights.

According to Excise & Licenses, Buddy Boy has surrendered dispensary permits for its stores at 5050 York Street and 777 Umatilla Street, but the company's marijuana sales licenses for shuttered outposts at 120 South Kalamath Street and 155 Federal Boulevard remain active.

The Denver Department of Finance would not comment on the specifics of any agreement with Buddy Boy.

"What we can say is that we generally continue to have conversations with Denver businesses who find themselves facing distraint warrants, or potential distraint warrants, because we want our businesses to succeed," says department spokesperson Joshua Rosenblum.

At the time of Buddy Boy's closure, Fritzel acknowledged that he likely owed the DOR money, too, but said he had yet to receive any notices. Nine DOR settlements related to Buddy Boy were filed with the state on June 8; all list Fritzel as the full controlling owner and note that he and Buddy Boy's owning entities will "file and pay all tax returns with the Colorado Department of Revenue as they come due." A fine of $5,000 was attached to each of the nine agreements as well, totaling $45,000.

A hefty portion of the information in these documents is redacted, including how much Buddy Boy stores owed in back taxes and how, exactly, the company violated a 2022 tax payment plan set up between the DOR and Buddy Boy. Fritzel, who is also an owner of a handful of marijuana cultivations as well as Lightshade and PotCo dispensaries, could not be reached for comment.

Several surprise marijuana business closures and rounds of layoffs rocked Colorado's marijuana industry in 2022 after years of continually increasing sales. Less than two months after the Buddy Boy dispensaries shuttered, TweedLeaf, a dispensary chain with seven stores across the state, closed all of its doors; it owed six figures in unpaid state sales taxes. A handful of old TweedLeaf stores have since been sold and reopened.

Earlier this year, a marijuana industry recruit firm reported that Colorado's marijuana job sector shrank by 30 percent from 2022 to 2023. Recent DOR market data shows marijuana prices and sales are creeping back up, however.