DENVER | Main Development Thread #6

[The Dirt]

I heard that Target doesn't consider their urban formats to be very successful, which is part of the reason we won't be getting one on the Makovsky block.

[DenverPoke]

Originally Posted by The Dirt

I heard that Target doesn't consider their urban formats to be very successful, which is part of the reason we won't be getting one on the Makovsky block.

That seems to contradict this from just a few months ago. I hadn't heard of the TargetExpress concept, Denver would seem like a good test market.

http://fortune.com/2014/10/24/city-target-brooklyn/

[RyanD]

Here's something you don't see everyday.


17th Street Canyon by RyanDravitz, on Flickr

[DenvertoLA]

Now let's add the 999 17th St. development to that photo

[blm3034L!fe]

Originally Posted by wong21fr

Anyone realize that we now have two 21-story, a 22-story, a 25-story, and a 34-story building U/C downtown right now? Plus a 40-story project that should break ground in Q2?

Hopefully this is just the beginning. I honestly believe it is and even greater things are on the horizon for this unique, beautiful, bustling and booming city of ours!

[Stonemans_rowJ]

Originally Posted by DenverPoke

Should be an interesting year for development news. I'm not expecting much in the way of new project announcements in 2015 although if the construction defect law is amended I think a couple of condo projects could be in the pipeline.

According to the Denver Post in a recent article entitled "Condo Comeback," there are already 2 condo projects in the works (198 condos at the St. Anthony Site) and Drivetrain in Rino (100 condos), in addition to the Coloradan at Union Station (what was that, 200+ units?)

Regardless of whatever happens in the legislature, we are going to see condos.

Also from the article, it states that insurance premiums are up:

"Hines estimates those premiums will run about 2.5 to 3 percent of their project cost versus the 0.5 percent that apartment developers are levied."

Furthermore, the article goes on to say that the premiums could change from the "half dozen insurers still willing to underwrite multifamily construction policies...

That could change as more condo projects get built without triggering legal action...

They are doing everything they can to reduce the margin of error...

That includes building with concrete and steel, where tolerances are tighter than wood frames."

[Stonemans_rowJ]

Originally Posted by wong21fr

In short: the current landowners are very difficult to work with.

The lot at 20th and Market is owned by Dikeou Investments. Dikeou is a name synonymous with a) not having developed anything in decades, and b) never selling the parcels they own.

One of the lots is owned by Blackrock, who foreclosed on the parcel when Corum couldn't make payments. That's going to take a pretty large developer to wrestle that parcel free. The other is owned by an entity called Becker LLC and is likely one of those family-owned, absentee parcels who are demanding such a large sum of money to make any project uneconomical.

Is there a precedent for levying large tax penalties on undeveloped city property, either in Denver or other large cities?

[TakeFive]

RyanD... I love that view.

Originally Posted by DenverPoke

That seems to contradict this from just a few months ago. I hadn't heard of the TargetExpress concept, Denver would seem like a good test market.

http://fortune.com/2014/10/24/city-target-brooklyn/

That's a good read; I haven't kept up either. They do a nice job of pointing out the opportunities and challenges, why Target is interested but moving slowly.

Not that it wouldn't be welcome but a Target Express is so condensed (at 20,000 sq. ft.) that it's essentially a duplication of what can already be found ie. Walgreens plus grab and go food etc. under the Target name.

Ideally you want a CityTarget which (a quick check) typically run 80,000-100,00 sq. ft. The Brooklyn store mentioned is 125,000 sq. ft. This size is what most people would prefer I'd guess but it's harder to find the right site/space for one of these.

[seventwenty]

Originally Posted by Stonemans_rowJ

Regardless of whatever happens in the legislature, we are going to see condos.

Yeah but at what price point? Right now the price point is close to $400,000. Not exactly affordable if you're a 20 something.

[TakeFive]

Originally Posted by Stonemans_rowJ

Is there a precedent for levying large tax penalties on undeveloped city property, either in Denver or other large cities?

Using a broader definition of downtown, Phoenix has as much as 40% that is being "land banked" - not necessarily vacant land but there's a lot. They looked at the issue a few years ago and decided not to pursue it. One easy way would be to reclassify the property taxes for vacant land.

"Property Rights" have always been sacrosanct which is the biggest issue. Even if it's 10, 20, 30 years from now there will be a time and "highest best use" for the property.

[TakeFive]

Originally Posted by seventwenty

Yeah but at what price point? Right now the price point is close to $400,000. Not exactly affordable if you're a 20 something.

As Wong so eloquently pointed out some time ago, downtown is reserved for elitists. Seriously though when you consider that a couple of the nicer apartment buildings have sold for over $300,000 per unit it becomes hard to imagine condos for less.

That's where the value and opportunity for TOD's comes in. Also surrounding neighborhoods; Lower Highlands, South Broadway corridor and RiNo for example.

[TakeFive]

I stopped by the Houston Business Journal today. Here's a few of their "headlines:"

Another week of drilling declines in Eagle Ford, Permian Basin.

ConocoPhillips weighs more job cuts, freezes pay

Amid plunging oil prices, luxury apartment developer shifts focus away from Houston

But there's also this:

"Low oil prices to hit Energy Corridor hardest, but will benefit other areas"

"The good thing we have going for us is that the chemical and refinery industry based here and along the Gulf Coast just loves these low oil and natural gas prices," Rutherford said. "That part of our industrial economy is still booming and will continue to boom."

As time goes along I'd guess we'll see a bit of this in Denver as well.

[DUPio]

Love that 17th St photo. Would like to see a photo down 17th from above DUS...

[Syndic]

Austinite here. Wanted to ask why you Denverites don't post your updates where every other city posts their updates instead of posting here where it's harder to follow your development?

[DownhomeDenver]

Originally Posted by Syndic

Austinite here. Wanted to ask why you Denverites don't post your updates where every other city posts their updates instead of posting here where it's harder to follow your development?

Hey buddy. We don't post there cuz we're provincial bumpkins in Denver.

[DownhomeDenver]

Originally Posted by Stonemans_rowJ

Is there a precedent for levying large tax penalties on undeveloped city property, either in Denver or other large cities?

This was discussed a couple of years ago I believe on here. There was a city in Pennsylvania that did this. I don't recall which one it was. They started to tax on the actual property value instead of improved value. If I remember correctly....

[Syndic]

Originally Posted by DownhomeDenver

Hey buddy. We don't post there cuz we're provincial bumpkins in Denver.

Well, congrats. It's pretty hard to be more provincial than Austinites in the state of Texas. I'm just saying it might be better for your city if you started a thread over there. We have our own (big) subforum, too. But we tend to post most of our big updates in the main forum. Just kind of a way of projecting an image.

I got on Seattle for the same thing and they post there all the time now.

Think about it.

[seventwenty]

Originally Posted by Syndic

Well, congrats. It's pretty hard to be more provincial than Austinites in the state of Texas. I'm just saying it might be better for your city if you started a thread over there. We have our own (big) subforum, too. But we tend to post most of our big updates in the main forum. Just kind of a way of projecting an image.

I got on Seattle for the same thing and they post there all the time now.

Think about it.

Tell ya what. We'll announce things in this thread, and you can post them onto the main forum.

[PLANSIT]

Originally Posted by Syndic

Well, congrats. It's pretty hard to be more provincial than Austinites in the state of Texas. I'm just saying it might be better for your city if you started a thread over there. We have our own (big) subforum, too. But we tend to post most of our big updates in the main forum. Just kind of a way of projecting an image.

I got on Seattle for the same thing and they post there all the time now.

Think about it.

We have one, but we're also lazy.

[seventwenty]

Originally Posted by PLANSIT

We have one, but we're also lazy.

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