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License deadline looms for thousands of Denver rental properties

Denver has only issued 200 licenses of the about 25,000 that will be required to be licensed Denver rental property come January 2023.

DENVER — Time is running out for thousands of rental properties to get licensed before the end of the year under Denver's new Residential Rental Property license.

"We're just constantly thinking what's the barrier?" said Eric Escudero, who's office, the Department of Excise and Licenses, is getting ready to send out a mailer with a reminder of the new license requirement to 40,000 addresses.

"Well we knew it was going to be a challenging license," said Escudero. "I mean when you're talking about the largest expansion of required business licensing in the history of Denver, we knew this wasn't gonna be easy as pie." 

Because of a city council ordinance that passed last year, Escudero estimated 25,000 multi-unit rental properties will be required to get licensed by Jan. 1. 

Come Jan. 1, 2024, single family home rentals will also need to be licensed. 

Before landlords can apply though, they need to pass an inspection that shows their property has the latest fire codes, and other basic standards like running water and heat. 

There is a fee exception for affordable or public housing properties. 

So far, Escudero said they have only issued 200 licenses.

"What we're worried about is unfortunately a lot of people often will procrastinate when there's new regulations," said Escudero. "And we're afraid that there will be a surge of thousands of license applications in November and December, and they'll go and they'll try to get the required inspection and we're worried that the inspectors will be overwhelmed." 

But where the city sees a potential backlog, Andy Rhodes found a business opportunity.

"We built our company just to handle this exact situation," said Rhodes, who started CCI, Colorado Compliance Inspections. 

Rhodes created CCI after Denver passed this new law knowing inspectors would be in short supply. 

On Thursday afternoon, a group of people sat in the conference room studying to be inspectors specifically to fill the gap the residential rental property license created.

"We'll be able to do 9,000 inspections between October 1 and the end of this year," said Rhodes. "We'll be able to do another 9,000 in the first three months of next year."

Both Rhodes and the city are worried about how many re-inspections might be needed if properties fail the first time.

Enforcement will be complaint-based from tenants. But Escudero said it will also be similar to their short term rental enforcement where they use a computer software company to look for listings. That will automatically compare the address to the licensing database and prompt the city to reach out if an address is out of compliance. 

Right now the largest license is Denver is for security guards, and Escudero said it's little under 7,000 licenses.  

But the last time there was this race to get as many businesses as possible licensed was in 2013 when medical marijuana companies were trying to get recreational licenses. Escudero said this rental property license is like that but on "performance enhancing steroids."

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