DENVER | Main Development Thread #7

[CherryCreek]

Geez, guys. Some NIMBYs effectively want to build a Trumpianesque wall around Colorado and stop further growth and everyone is ready to run away to Idaho, or something.

I think pro-growthers need to find their voice and a message that resonates with voters. Smart growth is good, density is good!!! A city cannot live and thrive on an urban scene of old people waiting to die in their over-spacious houses with wonderful views!

If people become convinced that a mindless anti-growth strategy will hurt their pocket books and their lifestyle, there is a decent chance some of the crazier sentiment can be beaten back.

[TakeFive]

^^ When you start talking about beating people I get nervous.


Herakles and the Hydra, Antonio del Pollaiolo, 15th century


Haven't we had enough new construction, already? I'm srsly having trouble keeping track of everything.

Which reminds me... RyanD/Denver Infill recently announced the groundbreaking of Southern Land's development at Pearl St and 17th Ave. You might recall...




Photos courtesy DenverInfill

The rendering courtesy of Southern Land Company and Shears Adkins Rockmore via DenverInfill:

[wong21fr]

Originally Posted by TakeFive

Which reminds me... RyanD/Denver Infill recently announced the groundbreaking of Southern Land's development at Pearl St and 17th Ave. You might recall...

Not exactly a groundbreaking, there's already a ginormous hole in the ground, but a rising for the structure as the foundation work begins.

[CherryCreek]

Originally Posted by TakeFive

^^ When you start talking about beating people I get nervous.



Haven't we had enough new construction, already? I'm srsly having trouble keeping track of everything.

Which reminds me... RyanD/Denver Infill recently announced the groundbreaking of Southern Land's development at Pearl St and 17th Ave. You might recall...

I can't quite tell whether I will like this one -the drawing is too generic. Will depend upon colors and materials shown. I hope they complement the historical building.

[Robert.hampton]

Originally Posted by CherryCreek

I can't quite tell whether I will like this one -the drawing is too generic. Will depend upon colors and materials shown. I hope they complement the historical building.

I took a look at the plans submitted to the city and nearly everything on this building facing 16th, Pearl, and 17th will be brick with the exception of the recessed balconies (stucco) and the portion which rises directly behind the single floor portion of the tavern, which will be a metal cladding. I think the metal cladding will give great contrast to the historic buildings and my guess is this project will turn out quite nice with a heavy dose of masonry. I think the plan is also still for the Tavern to come out of this with a roof top deck as well.

[SirLucasTheGreat]

Does anyone have any updates on Block 162?

[rds70]

Originally Posted by SirLucasTheGreat

Does anyone have any updates on Block 162?

The building permit is in third review by the City.

[TakeFive]

Somebody mentioned Tabor Two recently, actually Two Tabor and Ken has posted a nice overview of what's being proposed now at Denver Infill.
The least I can do is add some background music.

Video Link

[Keesy9]

The Denver Post had an article today saying 1144 Fifteenth is opening 85% leased. 1401 Lawrence was at 98% occupancy last year. That shows strong demand for Tabor 2 and Block 162 office space.

1401 Lawrence sold for $720/SF last year (I think including parking and retail). If you assume parking and retail has the same income, T2 at 680,000 SF could be worth $490,000,000 at $720/SF.

Some articles said 1144 Fifteenth cost around $300,000,000 to build and is 640,000 SF. That's about $469/SF to build.

Based off very rough math, it looks like the numbers make sense.

[BG918]

Originally Posted by Keesy9

The Denver Post had an article today saying 1144 Fifteenth is opening 85% leased. 1401 Lawrence was at 98% occupancy last year. That shows strong demand for Tabor 2 and Block 162 office space.

1401 Lawrence sold for $720/SF last year (I think including parking and retail). If you assume parking and retail has the same income, T2 at 680,000 SF could be worth $490,000,000 at $720/SF.

Some articles said 1144 Fifteenth cost around $300,000,000 to build and is 640,000 SF. That's about $469/SF to build.

Based off very rough math, it looks like the numbers make sense.

The only issue is that Tabor 2 would be coming on the market in about 3 years, assuming they actually start construction at the end of this year. The Denver office market could look very different in 2021. If they started construction in 2019 and finished in 2022 they could be delivering the first new Class A office space coming out of the impending recession so they may be thinking about the long game here. And the location near Union Station and the Market Station redevelopment is fantastic from an office leasing standpoint.

[mhays]

If the other buildings' leases represented net absorption, that would be strong evidence. If they were more about shuffling between buildings, not so much.

[rds70]

Originally Posted by mhays

If the other buildings' leases represented net absorption, that would be strong evidence. If they were more about shuffling between buildings, not so much.

According to this article: https://crej.com/news/strategy-and-vision-help-foster-denvers-demand/

"Investment in Denver is booming, and we have witnessed a series of sizable office developments throughout downtown and the center city neighborhoods. In total, more than 3.18 million square feet of office has been built in the past five years or is currently under construction, a level of office development we have never seen. With the rapid rise of office space construction, one would think we might see a spike in vacancy and reduction in lease rates as supply outpaces demand. Instead, our downtown market is witnessing stable vacancy at 11.6 percent and rising lease rates at an average of $33.09 per sf – the demand has kept pace with supply.

So where has this growing demand been generated? We are seeing office expansions and relocations from several key segments that are driving Denver’s growth."

[twister244]

Starting to look like between Sun Valley, River Mile, and now this, the area between Mile High and Union Station could be the next sea of cranes over the next several years (pending economic conditions).

https://www.denverite.com/denver-broncos-parking-lot-neighborhood-49813/

[TakeFive]

Originally Posted by rds70

According to this article: https://crej.com/news/strategy-and-vision-help-foster-denvers-demand/

"Investment in Denver is booming, and we have witnessed a series of sizable office developments throughout downtown and the center city neighborhoods. In total, more than 3.18 million square feet of office has been built in the past five years or is currently under construction, a level of office development we have never seen. With the rapid rise of office space construction, one would think we might see a spike in vacancy and reduction in lease rates as supply outpaces demand. Instead, our downtown market is witnessing stable vacancy at 11.6 percent and rising lease rates at an average of $33.09 per sf – the demand has kept pace with supply.

So where has this growing demand been generated? We are seeing office expansions and relocations from several key segments that are driving Denver’s growth."

There's been some bigger moves including from the burbs but that just opens up space at more affordable rates and/or a chance to upgrade space.

Going back 18-24 months I can recall what felt like a lot of dribs and drabs but a constant flow of announcements. Oftentimes move-in follows commitment by 6-9 months.

A lot of office space has been built in the Platte Valley but that land is now largely gone (isn't it?) so it's easily an opportunity for more downtown space. With '162' working towards final zoning approval I'd guess Two Tabor would be a couple of years behind that schedule so it's hard to see any significant excess supply likely developing.

[MountainRush]

Originally Posted by twister244

Starting to look like between Sun Valley, River Mile, and now this, the area between Mile High and Union Station could be the next sea of cranes over the next several years (pending economic conditions).

https://www.denverite.com/denver-broncos-parking-lot-neighborhood-49813/

Just took the light rail through the area today and it could seriously use a face lift. All these projects seem too good to be true, but I hope they actually happen!

[mhays]

Originally Posted by rds70

According to this article: https://crej.com/news/strategy-and-vision-help-foster-denvers-demand/

"Investment in Denver is booming, and we have witnessed a series of sizable office developments throughout downtown and the center city neighborhoods. In total, more than 3.18 million square feet of office has been built in the past five years or is currently under construction, a level of office development we have never seen. With the rapid rise of office space construction, one would think we might see a spike in vacancy and reduction in lease rates as supply outpaces demand. Instead, our downtown market is witnessing stable vacancy at 11.6 percent and rising lease rates at an average of $33.09 per sf – the demand has kept pace with supply.

So where has this growing demand been generated? We are seeing office expansions and relocations from several key segments that are driving Denver’s growth."

That would be completions before that time, omitting a lot of the new space. If it stays stable with the opening of new buildings, that will mean at least the market isn't overbuilt.

The real question of course is whether ADDITIONAL new space is merited. Past trends are only part of the story. Sometimes a recent boom is a reason NOT to build more.

[RyanD]

I attended the grand opening party for 1144 and it has such great views.

[TakeFive]

Great photos!

As much as I typically prefer closer-ups I looked at that first picture a good long time trying to decide if it should be my new desktop background; Decided to keep the one I've got which is your shot of 1144 at night shortly before the crane was taken down. Like that one since anyone who happens to see my desktop wouldn't know that was a new building except for the crane.

[rds70]

New population estimates for Colorado, per the Census Bureau (July 2017):

Denver CSA: 3,515,374, +424,500 since 2010, +13.7% since 2010

Denver County: 704,621, +104,463 since 2010, +17.4% since 2010

Colorado Springs MSA: 723,878, +78,265 since 2010, +12.1% since 2010

Fort Collins/Loveland MSA: 353,976, +44,346 since 2010, +14.8% since 2010

Pueblo MSA: 166,475, +7,412 since 2010, +4.6% since 2010

Grand Junction MSA: 151,616, +4,893 since 2010, +3.3% since 2010

[twister244]

Originally Posted by rds70

New population estimates for Colorado, per the Census Bureau (July 2017):

Denver CSA: 3,515,374, +424,500 since 2010, +13.7% since 2010

Denver County: 704,621, +104,463 since 2010, +17.4% since 2010

Colorado Springs MSA: 723,878, +78,265 since 2010, +12.1% since 2010

Fort Collins/Loveland MSA: 353,976, +44,346 since 2010, +14.8% since 2010

Pueblo MSA: 166,475, +7,412 since 2010, +4.6% since 2010

Grand Junction MSA: 151,616, +4,893 since 2010, +3.3% since 2010

700 Club!

I always forget too how the Springs has it's own rapid growth occurring as well, although much different in nature than with Denver.