Security companies struggle to meet the demand for their services
Denver Colorado March 9 2023
In 2019, when Nick LeMasters became CEO and president of the Cherry Creek North Business Improvement District, the organization budgeted $0 for security.
In 2023, a few short years and one pandemic later, the organization will spend $800,000 to have at least one private guard watching the business district every hour of the day.
“Overwhelmingly, our constituents have told me personally how much they appreciate the fact that we do have security on the streets 24/7,” LeMasters said.
Around the city, an increasing number of property and business owners are hiring private security. But the firms that provide those guards are struggling to meet demand.
Individual private guards, whether unarmed or armed, are required to obtain licenses from the city. Denver had 6,417 licensed guards as of mid-February, down about 16 percent from 7,684 in 2019, according to Eric Escudero, spokesman for the city’s Department of Excise and Licenses.
Jeff Rauske, president of Aurora-based Advantage Security, which provides the security for the Cherry Creek BID, told BusinessDen the company isn’t taking on new clients, despite regularly hearing from interested customers.
“The labor pool has shrunk and shrunk and it’s been extremely challenging for recruiting,” Rauske said.
Another local firm, Denver-based HSS, echoed Rauske’s comments. The company said in a statement that it’s “affected by the same tight labor market that is affecting every service company,” although it said its recent acquisition by a firm called Tarian Group “has positioned it to weather the labor challenges much better.”
Rauske said Advantage has roughly 700 employees across the entire state of Colorado. The company has 443 licensed guards in Denver, according to the city.
Rauske noted that recruiting and retaining employees is a challenge for many industries, but said the company is also affected by challenges faced by police departments. The Denver Police Department currently has 1,448 officers and 70 recruits, according to a spokesperson. The department’s authorized strength is 1,596 officers.
“One of the biggest impacts is the police issues, with us being a very similar industry of protection, their struggles spill over to us,” Rauske said.
Advantage does not arm any of its employees, and won’t guard places considered high-risk, like jewelry stores or marijuana dispensaries. Rauske said when an incident occurs, his guards are required to call the police. In the past, departments were quick to respond. Now, officers might not even show up.
“There’s too much going on in the city and too few police officers to respond,” Rauske said. “If we’re witnessing a crime in progress and contact the police, they might not even respond because it’s not a life-and-death situation.”
The Seventh Avenue Neighborhood Association, which represents an area south of Cheesman and Congress parks, surveyed residents last year on whether it should hire private security due to increased property crime. A representative told BusinessDen last month the association ultimately opted not to hire security after residents were split on the matter. An association in the nearby Country Club neighborhood, meanwhile, has had security for years.
Back in Cherry Creek, LeMasters said the BID first hired security when the pandemic hit. Without anyone on the street, merchandise in stores was “extremely vulnerable.”
“As with virtually every neighborhood in this city, we’ve seen an uptick in criminal behavior, which is concerning,” he said.
The Downtown Denver BID, which covers 120 blocks, first hired private security in 2016 after interviewing business and property owners, residents and homeless people.
“We came up with these initiatives and one being, if we increase the presence of security in the downtown area, that would help improve the perception of safety,” Vice President Beth Moyski said.
Unarmed guards hired through Allied Universal now patrol the BID’s boundaries an average of 20 hours a day.
The downtown BID spends roughly $1 million annually on all security expenses, the majority of that for the guards, according to the organization. That accounts for 12 percent of the organization’s entire budget.
In general, its security budget has been on the rise, with $862,341 budgeted in 2019 and $919,384 in 2022, but Moyski said the increase is largely due to rising labor costs.
Kourtny Garrett, president of the Downtown Denver Partnership, said hiring private security is a national trend for non-governmental downtown organizations.
“I think that’s just symptomatic of the times that we’re in unfortunately,” Garrett said.
