DENVER | Main Development Thread #7

[bunt_q]

Originally Posted by SnyderBock

I find it interesting that the Zillow search doesn't show hardly any results at $1200 or less, in any of the Neighborhoods that I would ever choose to live in. Why isn't there a mix of income levels in all neighborhoods? Why do rentals at $1200 or less have to be segregated and concentrated in certain pockets nowhere near train stations? I think they severely overbuilt on luxury rental units and now the people who can afford those are buying homes in the suburbs. The people forced to live in shitty parts of the city, away from train stations and with long commutes to work are also forced to own cars. So you have to add car ownership onto rent. If these $1200 a month units were concentrated near train stations, they wouldn't have to own a car at all. Instead, the people who can afford to live near train stations, hardly even use the trains, because they own fancy BMW's, Mercedes and Crossovers. If you can afford to live near a train station, you don't need to. Furthermore, all these people renting $1200 apartments, are stuck renting, because there is a severe shortage of condo stock in the sub 250k range, which would be their price points.

Add to this the fact that the CEO's of Chase, Capital One and Discover have announced the Americans are accumulating credit card debt at rapid levels, in order to maintain their current lifestyles, so as a result they are closing inactive accounts +so they do not become active), slowing way down in credit line increases and becoming far more struck about who they approve for new lines of credit.

Plus there is that darn recession we are headed straight into. Trades wars cause recession (see warning from our government officials about the results of the last great trade war and the ensuing recession). Short term interest has eclipsed 10 year Treasury notes. A decades long run of wage growth less than half the rate of rises in cost of living and barely above the rate of inflation. Overbuilt market of Luxury homes and apartments and a shortage of affordable housing. Plus a slowing job growth sector that is about to have tens of millions of positions replaced by AI and automation, over the next decade.

I'm not trying to be an alarmist or strike fear into anyone's hearts. I have always been gifted with seeing the big picture and time and time again, everything ends up playing out just as I for saw. It is not mystical or supernatural. It is projections and forecasts produced by my brain analyzing all available data and variables, then constructing multiple sinarios that might play out, then predicting probabilities for each.

If we do not implement a universal basic income very swiftly (by Washington standards), then we will face the potential of another great depression. Especially if the trade wars persist much longer.

I dunno, stuff’s going pretty well for me. You should use those gifts and that supernatural brain of yours to go make some money. Stop stressing about the theoretical. Buy yourself some happiness, man.

Also, we luxurious folk don’t use discover cards. The rewards are shit.

[Matt]

Originally Posted by COtoOC

It says the new proposal will be "a lot more realistic", so probably a 40 story box?

Note to self: An 80-story building is "not realistic" in the downtown of a metro area of 4 million people, which also happens to be one of the fastest-growing in the country. Got it.

I've always known Denver to lack big-city drive and a cosmopolitan aspiration, but this podunk thinking has become absurdly ridiculous and is now pushing towards utter lunacy. Even the property owers/managers are lowering the bar down from reasonable expectations.

Even more dangerous is the narrative that Geller's comments set moving forward.

[mhays]

The economics driving an 80-story building are pretty tough.

It needs very high rents or sale prices per square foot -- for a lot of space all at once. Denver has plenty of land for cheaper buildings, which often have a similar view and good locations.

It also takes much longer to build, with more uncertainty before it starts. An unlike the early 80s, a condo or office would generally need to prelease or presell. Presales and three-year lead times don't go well together.

My city hasn't gotten one either.

[SirLucasTheGreat]

Originally Posted by mhays

The economics driving an 80-story building are pretty tough.

It needs very high rents or sale prices per square foot -- for a lot of space all at once. Denver has plenty of land for cheaper buildings, which often have a similar view and good locations.

It also takes much longer to build, with more uncertainty before it starts. An unlike the early 80s, a condo or office would generally need to prelease or presell. Presales and three-year lead times don't go well together.

My city hasn't gotten one either.

I'm not an engineer but isn't there something unique about our soil that makes vertical construction much more costly than some other environments?

[wong21fr]

Originally Posted by SirLucasTheGreat

I'm not an engineer but isn't there something unique about our soil that makes vertical construction much more costly than some other environments?

Nope. We're not that special IIRC.

Yes, there are expansive soils in the area, but the bedrock isn't super deep. Though it is sedimentary bedrock that isn't hard like granite which can present challenges that I believe are usually addressed by having the piers go deeper into the bedrock that if it was made of a harder material. But these are challenges that would make an 80-story building impossible. Rather it's the challenge of securing tenants in a sufficient quantity and time to meet financing requirements. If we had someone (company or individual) who wanted to do a vanity project and had the capital to make it happen it would probably be more likely that we would see such a project rise.

Here's holding out hope that one of the local unicorns goes from a $1B cap to a $100B cap.

[TakeFive]

"That area is just really up and coming and turning over," Bildstein said. "It’s kind of like a mini RiNo."
The reference presumably refers to the current industrial flavor.

https://www.bizjournals.com/denver/n..._news_headline

A developer looking to capitalize on growth along South Broadway has received a $16.1 million ground-up construction loan to move forward on planned condos at the corner of Jewell Avenue and South Bannock Street.

The building's 58 units will be a mix of one-bedrooms, one-bedrooms with a den, two-bedrooms and mezzanine units, ranging from $339,000 on the low end to $617,750 for the mezzanine units. Residents will also have access to secured parking and a roof terrace with a fireplace and community grills, according to the development's website.

This potential TOD area has taken some time but by golly it's seems to be gathering steam. This will be across the street from a 200-unit Greystar project the Encore Evans Station apartments.

A block to the south an eight-story apartment building has already been approved called Cherokee Flats by LCP Development.


Courtesy LCP Development via BusinessDen

Originally Posted by wong21fr

Here's holding out hope that one of the local unicorns goes from a $1B cap to a $100B cap.

A $billion here; a $billion there and pretty soon we're looking at a new tallest.

[bushw00d]

Originally Posted by Matt

Even more dangerous is the narrative that Geller's comments set moving forward.

If you think Buzz Geller's comments to local press are setting any sort of narrative with the people who spec, design, fund, and construct these buildings, I don't really know what to tell you.

We don't get big tall buildings here because users won't pay the premiums required to build them. It's not complicated.

[mhays]

A company with a $100b market cap seems unlikely to build or lease a supertall building. Public companies generally don't go for vanity projects.

Philly's and San Francisco's new HQ towers follow these rules...supertalls make sense on spreadsheets in those places, when tenants place huge value in being in the absolute core districts, right next to transit. They can also do very low parking ratios...the latest Comcast tower has 77 spaces for I'd guess 7,500 workers.

Less parking avoids a big cost for any job, but this is more important with a bigger tower...either you need more land for parking on the side, or you have a huge amount of tower structure, transportation, etc. competing for space in your garage, particularly if the garage is above-grade.

[BG918]

Originally Posted by TakeFive

"That area is just really up and coming and turning over," Bildstein said. "It’s kind of like a mini RiNo."
The reference presumably refers to the current industrial flavor.

https://www.bizjournals.com/denver/n..._news_headline

This potential TOD area has taken some time but by golly it's seems to be gathering steam. This will be across the street from a 200-unit Greystar project the Encore Evans Station apartments.

A block to the south an eight-story apartment building has already been approved called Cherokee Flats by LCP Development.

I was just down in this area and wow there is a lot of new development going on that flies under the radar. That whole area is quickly developing into multiple TOD clusters with Alameda Station on the north end where Price Development is currently building a 5 story, 341 unit apartment building. There is a 377 unit apartment building proposed for the lot just to the east at Alameda & Bannock. And then all of the current and future development on the Gates Factory site at I-25/Broadway and down to Evans Station.

[TakeFive]

Originally Posted by mhays

The economics driving an 80-story building are pretty tough.

It needs very high rents or sale prices per square foot -- for a lot of space all at once. Denver has plenty of land for cheaper buildings, which often have a similar view and good locations.

It also takes much longer to build, with more uncertainty before it starts. An unlike the early 80s, a condo or office would generally need to prelease or presell. Presales and three-year lead times don't go well together.

My city hasn't gotten one either.

Your city like our city got its tallest during the 1980's from the iconic Columbia Tower at 76 stories to the Seattle Municipal Tower at 62 stories and two others at 55 and 56 stories. That's the same period when Denver got it's three tallest at 56, 53 and 52 stories. Who knows, had the oil boom not gone bust maybe Denver would have built an even taller building.

In contemporary times and another peer city, Austin has gotten some aggressive and impressive buildings. Their two tallest at 58 and 56 stories are both condo projects.

Amacon has built a few 40 to 50-story condo towers in the Toronto area but the proposed 38 and 32-story condo towers in Denver are very comparable to what they've built in Vancouver.

Someday, special circumstances could well see a new tallest in Denver maybe 60 to 65 stories which would be cool enough.

[mhays]

In the oil boom, it was also the days of big towers built on spec thanks to the lax standards that gave us the S&L crisis. It was much easier then.

[TakeFive]

Originally Posted by BG918

I was just down in this area and wow there is a lot of new development going on that flies under the radar. That whole area is quickly developing into multiple TOD clusters with Alameda Station on the north end where Price Development is currently building a 5 story, 341 unit apartment building. There is a 377 unit apartment building proposed for the lot just to the east at Alameda & Bannock. And then all of the current and future development on the Gates Factory site at I-25/Broadway and down to Evans Station.

So how's the light/commuter rail TOD looking?

• Denver Union Station: Home Run or A- for the fussy
• 38th and Blake Station: Looking mighty good; a pending A-
• Pepsi Center Station: In planning; I'll guess a A- when its done
• Belleview Station: Coming along nicely A-
• 10th and Osage: Nicely done so far according to its vision B+
• Alameda Station: Solid with upside but less potential than others B
• I-25 and Broadway: A work-in-progress; destined to be solid B
• Evans Station: Warming up fast; projected B-
• Decatur-Federal: Just a matter of time; likely B+
• Central Park? Promises, promises to early to rate Incl
• 41st and Fox: Nice start, scratching the itch Incl

While I didn't set a high bar for grading I've gotta say that Denver is getting a lot of bang for their light and commuter rail buck with respect to TOD.

[SirLucasTheGreat]

Originally Posted by TakeFive

So how's the light/commuter rail TOD looking?

• Denver Union Station: Home Run or A- for the fussy
• 38th and Blake Station: Looking mighty good; a pending A-
• Pepsi Center Station: In planning; I'll guess a A- when its done
• Belleview Station: Coming along nicely A-
• 10th and Osage: Nicely done so far according to its vision B+
• Alameda Station: Solid with upside but less potential than others B
• I-25 and Broadway: A work-in-progress; destined to be solid B
• Evans Station: Warming up fast; projected B-
• Decatur-Federal: Just a matter of time; likely B+
• Central Park? Promises, promises to early to rate Incl
• 41st and Fox: Nice start, scratching the itch Incl

While I didn't set a high bar for grading I've gotta say that Denver is getting a lot of bang for their light and commuter rail buck with respect to TOD.

I'm really interested to see how the three new Lone Tree stations do in attracting TOD. Lone Tree went all in to help finance that extension.

[TakeFive]

Originally Posted by mhays

In the oil boom, it was also the days of big towers built on spec thanks to the lax standards that gave us the S&L crisis. It was much easier then.

Pffffft

That was a nothing burger compared to the computer driven "do you have a heartbeat" NINJA ("no income, no job and no assets") lending of 2006/2007 packaged up and passed along as high quality new fancy Wall Street derivatives with their various tranches. Now that was a Recession to Remember. Denver didn't suffer from a significant overhang of real estate inventory but it hardly mattered as the aftershocks impacted everybody.

Interestingly, most recessions have been driven by real estate excesses. The Fed-induced recession of the 80's though resulted more from uncontrollable inflation; it was mostly a cost & wage spiral.

But your point about today is why it's hard to find any real estate bubbles. If the economy were to become constipated there might be some inventory overhang here and there but nothing particularly scary.

[TakeFive]

Originally Posted by SirLucasTheGreat

I'm really interested to see how the three new Lone Tree stations do in attracting TOD. Lone Tree went all in to help finance that extension.

Lone Tree will do very, very well.

It goes as much to another discussion of building contemporary mixed-use areas that are walkable even if at a suburban level of medium density. Whether tech companies or others, nice open floor design with larger floor plates are in high demand. Light rail is a cherry on top as it attracts funding which attracts developers and tenants and those (millennial's and others) who want to live in mixed use areas.

It should succeed similarly to The Domain in Austin or downtown Tempe which incorporate these same appealing features. It's what the DTC generally lacks.

Because downtown Denver has become such a magnet metro Denver doesn't really have other developing strong mixed-use areas aside from Lone Tree that I can think of.

[twister244]

Does anyone have a rendering for this?......

https://www.hotel-online.com/press_r...nver-colorado/

[UrbanT]

Originally Posted by TakeFive

"That area is just really up and coming and turning over," Bildstein said. "It’s kind of like a mini RiNo."
The reference presumably refers to the current industrial flavor.

https://www.bizjournals.com/denver/n..._news_headline

This potential TOD area has taken some time but by golly it's seems to be gathering steam. This will be across the street from a 200-unit Greystar project the Encore Evans Station apartments.

A block to the south an eight-story apartment building has already been approved called Cherokee Flats by LCP Development.


Courtesy LCP Development via BusinessDen


A $billion here; a $billion there and pretty soon we're looking at a new tallest.

There’s construction equipment and fencing up at both of these sites!

[UrbanT]

Originally Posted by twister244

Does anyone have a rendering for this?......

https://www.hotel-online.com/press_r...nver-colorado/

https://www.bisnow.com/denver/news/h...-in-rino-92932

[TakeFive]

Originally Posted by twister244

Does anyone have a rendering for this?......

https://www.hotel-online.com/press_r...nver-colorado/

No, but I always love it when I see shovels:


Courtesy: TWC Management via Hotel Online

Originally Posted by UrbanT

There’s construction equipment and fencing up at both of these sites!

Good to know, way to go.

Originally Posted by UrbanT

https://www.bisnow.com/denver/news/h...-in-rino-92932

Well, you're a wealth of good information today.


Courtesy of Base4 via BizNow

[TakeFive]

The Fox North site will mark the first project for the international partnership.


Courtesy Tryba Architects via Denverite

41-acre 'Fox North' parcel in Globeville sells for $56.5 million
Aug 22, 2019 By James Rodriguez – Data Reporter, Denver Business Journal

The new owner is Vita Fox North LP, a partnership between Indianapolis-based Pure Development and Mexico City-based Interland. Tyler Morris, principal at Pure Development, said the international partnership is keeping an open mind as it considers the future of the site.

"We’re taking the plans that Tryba put together with the previous owners into heavy consideration," Morris said. "I know they’re a great group. Our team has personally met with David Tryba, and really hold that company in high regard. At this point, it’s hard to say what the final plans will end up looking like."

Who are these clowns? Some general background, please?

The partnership between Interland and Pure Development was born out of more than 20 years of personal and professional relationships, Morris said. The Fox North site will mark the first project for the international partnership.

Featured projects on Pure Development's website include corporate headquarters, manufacturing facilities and distribution centers. "Having a corporate user on the site would be something we would consider," Morris said. But it's still way too early to tell that. We're still in the preliminary stages."

Maybe add a little hype to this?

Eric Roth, senior vice president at CBRE, said the site's proximity to downtown Denver, Highland and Sunnyside have it "poised to be the next RiNo."

“Located one block from the Fox Street RTD Station and one stop away from Union Station, the site is one of the largest and most exciting urban [transit-oriented development] sites in the metro area,” Roth said in a press release. “We are confident that the new ownership will be strategic in their vision to create placemaking and ultimately a special project.”

Oh yeah, that was good; now I'm stoked.

(Rumor has it that Mexico says Trump is going to pay for this.)