DENVER | Main Development Thread #7

[TakeFive]

Yes Sir!

Originally Posted by EngiNerd

Didn't we already establish before that this article and its so-called "data" is very much a "correlation doesn't equal causation" scenario? Someone searching to move doesn't not mean that it actually happens, they provide no backup data showing correlation between what percent of searches to relocate actually result in actual moves. Basically meaningless statistics leading to a clickbait article.

I would agree that considering/looking is not the same as actually doing/moving. So as long as we understand that - the methodology then we can accept it for whatever value it provides.

We're already aware that many people who have moved to Denver have come from Cali, New York and Chicago. I offer Exhibit A - the over 40,000 people who showed up Tuesday evening to watch the Chicago White Sox play the Rockies at Coors Field. Yes, it felt like as many White Sox fans as Rockies fans.

Would I prefer actual data (that's reasonably accurate) as apposed to speculation? Sure! But what this seems to indicate is that many people in those cities are at least interested in considering a more affordable place/city to live. I hardly find this to be shocking. We know several from right here on this forum who did exactly that.

[TakeFive]

Well stated

Originally Posted by mhays

Buyers will always leave expensive cities. College grads move in and rent, then often move out when they want to buy. It's an endless cycle.

As for supply and demand imbalance, no it's not just developer lag. It's difficulties and costs baked into the system. Land prices are high due to insufficient zoned capacity. Entitlements are too onerous. And so on.

Also, fundamentally, the size and complexity of today's housing means a lot of wage hours by a lot of people. If they get living wages, stuff will be expensive. Foreign supply chains aren't so cheap or easy anymore.

If you want cheaper housing, you have to address the cost of new supply. Upzoning to spread land costs out would be a first step. Less square footage would be another (a personal choice, but heavily restricted by land use codes). A simpler, quicker, and certain entitlement process would be a third.

This is a good up-to-date take that I wouldn't disagree with relative to new projects. It also confirms some of what I said.

So far as zoning which I have a different view, I would add that this would be more of a long term solution assuming it worked (which I doubt).

[EngiNerd]

Originally Posted by TakeFive

Part One: It's too easy to talk past each other

I need to understand things; the why of things. So I went back to this post to remind of that time period.

The Re-awakening of downtown Denver

A) December of 2005 saw the Grand Opening of the Hyatt Regency Convention Center Hotel. This followed the doubling in size of the Convention but it was the completion of the hotel that allowed for bigger conventions to start booking in Denver.

B) In 2009, Kiewit Western Co. was selected as the design-build contractor for the transit project. Construction at Union Station began in 2010 and the Grand Opening in May of 2014 and commuter rail service arrived in 2016.

Perhaps just as important the ball for the Union Station project started rolling in 2001 and 2002 which meant the buzz around downtown sort of escalated as the decade went along.

The Great Recession ran from December of 2007 through June of 2009. It was created from the excesses of RE development.

In my opinion the "reawakening" of downtown this time around will be driven by the 16th Street mall reconstruction. If DDP is on their game (they usually are) they will use the reconstruction as a marketing opportunity to rebrand the downtown experience, tie in lots of events with it, and try to drive interest downtown once more. Right now, interest definitely is trending elsewhere than the city core based on my many conversations with downtown building property managers (my work allows me direct contact with a good percentage of them).

This means that we will have to suffer through a couple of years until that happens, but I think better things are coming once that project is finished.

[TakeFive]

Very well could be

Originally Posted by EngiNerd

In my opinion the "reawakening" of downtown this time around will be driven by the 16th Street mall reconstruction. If DDP is on their game (they usually are) they will use the reconstruction as a marketing opportunity to rebrand the downtown experience, tie in lots of events with it, and try to drive interest downtown once more. Right now, interest definitely is trending elsewhere than the city core based on my many conversations with downtown building property managers (my work allows me direct contact with a good percentage of them).

This means that we will have to suffer through a couple of years until that happens, but I think better things are coming once that project is finished.

Recently when I was perusing Denver Infill Roundups (love those Roundups) one thing that popped into my head was the disadvantage (as apposed to the advantage) of a nice downtown 'street wall,' is the lack of GREEN or landscaping; this brought me quickly to how wonderful the 16th Street Mall is in that respect. I also recalled the wonderful makeover of 14th Street.

The other critical piece that feeds into the 'Mall' is the CCC or convention center; so hopefully that comes back fairly strong soon. High Season for tourism in Denver (not the mountains) is probably mid-June through September; but the convention business when it's good is more spread out throughout the year.

Certainly, I've been looking forward to the 16th Street Mall redo.

[DenverInfill]

Originally Posted by TakeFive

Very well could be


Recently when I was perusing Denver Infill Roundups (love those Roundups) one thing that popped into my head was the disadvantage (as apposed to the advantage) of a nice downtown 'street wall,' is the lack of GREEN or landscaping; this brought me quickly to how wonderful the 16th Street Mall is in that respect. I also recalled the wonderful makeover of 14th Street.

The other critical piece that feeds into the 'Mall' is the CCC or convention center; so hopefully that comes back fairly strong soon. High Season for tourism in Denver (not the mountains) is probably mid-June through September; but the convention business when it's good is more spread out throughout the year.

Certainly, I've been looking forward to the 16th Street Mall redo.

The presence of a street wall and green landscaping are not mutually exclusive. It's easy to have both. In fact, since the city requires all new development to have trees and other landscaping along the sidewalk, downtown is getting significantly greener due to new development than it was when those site were empty lots. Of course, property owners have to maintain the landscaping, replace trees if they die, etc.


I'm glad you like the roundups!

[TakeFive]

Part Four

Wait... what happened to Part Three?
Not sure; I looked around, couldn't find it.

I want to focus on the period between 2010 and 2015 - (so try to focus like a razor beam on this period)

I clearly remember BG918 (hope things are well in Tulsa) being one of our 'caution flags' thinking Denver may be getting overbuilt, that a Recession may not be far off.

The Apartment Experts

Ah yes, these guys were (often) sure Denver would soon be waay overbuilt and vacancies would go through the roof. Problem was, they relied too much on historical data of new units, vacancy etc. To be fair population (and other) data lags by a year or so.

The Tech World View

In the 1st half of the 2010's it was Austin that sucked all the tech oxygen out of the air. More mundane tech companies looking to escape CA often ended up in Dallas due to generous incentives.

Yes, Colorado/Denver has always had a solid tech presence but those companies mostly landed in the suburbs. It was only in the 2nd half of the last decade that tech discovered downtown Denver.

The World of Developers

Take look at this list. While it doesn't change a lot from year to year I did intentionally picked out 2015.

The Lennar Multifamily Story (abbreviated)

Like many new-to-Denver builders LMC started in the suburbs. They built in Green Valley Ranch before they came downtown. They started with a modest project along Blake Street before building a nice-sized project in Uptown, then moving into Arapahoe Square before falling in love with the Golden Triangle. While LMC may be a star in Denver, it's also a typical 'cautious' approach to building in Denver.

Most of the developers on the Top 50 list have at least some presence in Denver. Some have been busy builders like Holland Partners, Mill Creek, Trammel Crow Res and more recently Greystar. Others have dabbled.

Carmel who's CEO grew up in Denver has only become more prominent in recent years. AMLI who's long had a local office only revved up more recently in the City although they've built in Denver over a long time.

The development of Brighton Blvd corridor was real slow early on; now it's On Fire. It just takes time to build momentum typically.

It is pretty impressive the number of National developers that have built in Denver. Still, it all just does take time.

Footnote: Just a reminder that all the population data being discussed is STATE data although presumably Denver metro comprises a majority of it.

[TakeFive]

Originally Posted by DenverInfill

The presence of a street wall and green landscaping are not mutually exclusive. It's easy to have both. In fact, since the city requires all new development to have trees and other landscaping along the sidewalk, downtown is getting significantly greener due to new development than it was when those site were empty lots. Of course, property owners have to maintain the landscaping, replace trees if they die, etc.

Okay; I wondered.

I also wondered how long a few of those might survive. Does Denver have landscape cops?

You've got to admit this is awesome

14th Ambassador Street - All photos courtesy of Confluence










This photo courtesy of SEGD

[DenverInfill]

The landscaping along the Market Station development is really nice. Here's a photo courtesy of JWalk's twitter account. Source.

[TakeFive]

^^ Yeah, that's nice. Market Station is nice!

Originally Posted by mhays

Land prices are high due to insufficient zoned capacity. Entitlements are too onerous. And so on.

If you want cheaper housing, you have to address the cost of new supply. Upzoning to spread land costs out would be a first step. Less square footage would be another (a personal choice, but heavily restricted by land use codes). A simpler, quicker, and certain entitlement process would be a third.

I see where Seattle is going to do a "Comprehensive Plan Update" to include looking at various zoning issues. No use getting into the weeds since they don't anticipate a plan being ready for voter approval until 2024 for 2025 implementation. But there is this:

Is Housing becoming more affordable in Minneapolis?

Housing production is rising and rents are falling.
May 11, 2022 by Christian Britschgi

Minneapolis appears to be a YIMBY (Yes in my backyard) success story of relaxed zoning regulations leading to increased housing production and declining rents.

In addition to the above piece, website Governing also has a good take on the single family zoning ban. It's a good/interesting read.

How Important Was the Single-Family Zoning Ban in Minneapolis?
May 26, 2022 By Jake Blumgart - Governing

The effort caught national attention, but the real story is the rest of the package of land use reforms that the city council passed to open up the housing market. However, opposition to further reform is growing.

Is this a sign of a YIMBY victory? Hold the phone; apparently we have different data sets at play.

The Twin Cities has the worst housing shortage in the nation
SEPTEMBER 18, 2021 By Jim Buchta - Star Tribune

This is too funny; this has a very familiar ring to it.

After more than a decade of underbuilding, the lack of housing poses a growing threat to the region's economic growth.

That distinction will come as no surprise to anyone who has tried to buy a home or rent an apartment recently in the Twin Cities. But rising prices and the persistent scarcity of entry-level homes and rentals poses a growing threat to the economic expansion of the region.

Pick you data and your outcome I guess, lol.

Note: There is an 8 month gap on above articles which hardly seems like enough for much to change.

[bunt_q]

Originally Posted by TakeFive

^^ Yeah, that's nice. Market Station is nice!



I see where Seattle is going to do a "Comprehensive Plan Update" to include looking at various zoning issues. No use getting into the weeds since they don't anticipate a plan being ready for voter approval until 2024 for 2025 implementation. But there is this:

Is Housing becoming more affordable in Minneapolis?

Housing production is rising and rents are falling.
May 11, 2022 by Christian Britschgi


In addition to the above piece, website Governing also has a good take on the single family zoning ban. It's a good/interesting read.

How Important Was the Single-Family Zoning Ban in Minneapolis?
May 26, 2022 By Jake Blumgart - Governing


Is this a sign of a YIMBY victory? Hold the phone; apparently we have different data sets at play.

The Twin Cities has the worst housing shortage in the nation
SEPTEMBER 18, 2021 By Jim Buchta - Star Tribune

This is too funny; this has a very familiar ring to it.


Pick you data and your outcome I guess, lol.

Note: There is an 8 month gap on above articles which hardly seems like enough for much to change.

It would help if you would post those chronologically. It's not inconsistent for there to be a severe shortage in September, and then to see increased construction the following May. Isn't that exactly the trend in headlines we would want to see?

[TakeFive]

I like this... it could happen.

Originally Posted by bunt_q

It would help if you would post those chronologically. It's not inconsistent for there to be a severe shortage in September, and then to see increased construction the following May. Isn't that exactly the trend in headlines we would want to see?

As I mentioned, after I learned what Seattle was looking to do, I decided to check into any updates on Minneapolis. It was a pleasant surprise to learn there were recent updates on the state of things.

I changed a couple of keywords when I found the September article (which is why it was out-of-order). That piece appears to be more of a broad-based take for all housing in the metro area while the other two articles are more focused on apartment inventory.

I also learned that apartment construction in Minneapolis has been trending higher since 2018 and here we are in Spring of 2022. So it's entirely possible that apartment inventory recently got ahead of demand.

Also interesting is I've wondered - what with all the apartments currently under construction in Denver if this might not happen here as well.

The last point is what affordable rents mean depends on who you ask but rents dropping would never be a bad thing.

[laniroj]

Originally Posted by DenverInfill

The presence of a street wall and green landscaping are not mutually exclusive. It's easy to have both. In fact, since the city requires all new development to have trees and other landscaping along the sidewalk, downtown is getting significantly greener due to new development than it was when those site were empty lots. Of course, property owners have to maintain the landscaping, replace trees if they die, etc.


I'm glad you like the roundups!

For a new incoming Mayor, I'd think a downtown specific and neighborhood equity analysis for greenery (already on the City's books) would be a hell of a campaign focus - City beautiful 2.0 - if combined with right sized police enforcement/presence. While Denver has mainly recovered new buildings from the DURA demo decades, the significant treescapes we lost during that era really haven't recovered. Even Speer Blvd is in disrepair compared to historic norms. As we rethink bike lanes, one ways, and sidewalks downtown, a billion dollar bond would go a hell of along way to really beautify the core and long neglected neighborhoods. To me, greenery is a difference maker between competitor cities like Austin, Seattle, Tampa, etc and Denver and it's something that could really attract more residential development in the core and help revive everything east of Lodo.

[laniroj]

Originally Posted by TakeFive

...Carmel who's CEO grew up in Denver has only become more prominent in recent years...

Carmel was also one of the most prominent/active multifamily developers in CO throughout the 80's/90's/00's before selling the whole enchilada after the great recession - while I'm sure it worked for them, it was perhaps the most ill-timed portfolio sale in a generation. Had they waited just a year or two, they would have seen a hugely significant increase in sale prices. I believe they still hold significant amounts of buildable land in CO and if they pressed the gas pedal, could probably build significant multifamily for several years before running out of land. Your guess is as good as mine as to why they haven't/aren't.

[laniroj]

Originally Posted by TakeFive

...This is too funny; this has a very familiar ring to it.


Pick you data and your outcome I guess, lol.

Note: There is an 8 month gap on above articles which hardly seems like enough for much to change.

You should add an article about the City of St Paul passing rent control and capping rent increases, which legitimately put an instant stop to new development in the city. This undoubtedly complicates any analysis of the Twin Cities housing situation.

[bunt_q]

Originally Posted by laniroj

Carmel was also one of the most prominent/active multifamily developers in CO throughout the 80's/90's/00's before selling the whole enchilada after the great recession - while I'm sure it worked for them, it was perhaps the most ill-timed portfolio sale in a generation. Had they waited just a year or two, they would have seen a hugely significant increase in sale prices. I believe they still hold significant amounts of buildable land in CO and if they pressed the gas pedal, could probably build significant multifamily for several years before running out of land. Your guess is as good as mine as to why they haven't/aren't.

I was a renter in a Carmel community when they dumped the whole portfolio. It's not just that they sold, but also how they sold, which appears to have been in fire sale fashion. Everything they dumped went down-market in a big way. Not unusual, but this was so precipitous, it makes me think they got dimes on the dollar relative to what they should have held out for.

[bunt_q]

Originally Posted by laniroj

For a new incoming Mayor, I'd think a downtown specific and neighborhood equity analysis for greenery (already on the City's books) would be a hell of a campaign focus - City beautiful 2.0 - if combined with right sized police enforcement/presence. While Denver has mainly recovered new buildings from the DURA demo decades, the significant treescapes we lost during that era really haven't recovered. Even Speer Blvd is in disrepair compared to historic norms. As we rethink bike lanes, one ways, and sidewalks downtown, a billion dollar bond would go a hell of along way to really beautify the core and long neglected neighborhoods. To me, greenery is a difference maker between competitor cities like Austin, Seattle, Tampa, etc and Denver and it's something that could really attract more residential development in the core and help revive everything east of Lodo.

Edit: Nevermind.

[EngiNerd]

Originally Posted by TakeFive

Part Four

Wait... what happened to Part Three?
Not sure; I looked around, couldn't find it.

I want to focus on the period between 2010 and 2015 - (so try to focus like a razor beam on this period)

I clearly remember BG918 (hope things are well in Tulsa) being one of our 'caution flags' thinking Denver may be getting overbuilt, that a Recession may not be far off.

The Apartment Experts

Ah yes, these guys were (often) sure Denver would soon be waay overbuilt and vacancies would go through the roof. Problem was, they relied too much on historical data of new units, vacancy etc. To be fair population (and other) data lags by a year or so.

The Tech World View

In the 1st half of the 2010's it was Austin that sucked all the tech oxygen out of the air. More mundane tech companies looking to escape CA often ended up in Dallas due to generous incentives.

Yes, Colorado/Denver has always had a solid tech presence but those companies mostly landed in the suburbs. It was only in the 2nd half of the last decade that tech discovered downtown Denver.

The World of Developers

Take look at this list. While it doesn't change a lot from year to year I did intentionally picked out 2015.

The Lennar Multifamily Story (abbreviated)

Like many new-to-Denver builders LMC started in the suburbs. They built in Green Valley Ranch before they came downtown. They started with a modest project along Blake Street before building a nice-sized project in Uptown, then moving into Arapahoe Square before falling in love with the Golden Triangle. While LMC may be a star in Denver, it's also a typical 'cautious' approach to building in Denver.

Most of the developers on the Top 50 list have at least some presence in Denver. Some have been busy builders like Holland Partners, Mill Creek, Trammel Crow Res and more recently Greystar. Others have dabbled.

Carmel who's CEO grew up in Denver has only become more prominent in recent years. AMLI who's long had a local office only revved up more recently in the City although they've built in Denver over a long time.

The development of Brighton Blvd corridor was real slow early on; now it's On Fire. It just takes time to build momentum typically.

It is pretty impressive the number of National developers that have built in Denver. Still, it all just does take time.

Footnote: Just a reminder that all the population data being discussed is STATE data although presumably Denver metro comprises a majority of it.

The new fun thing that I hadn't seen before is now entire single family subdivisions are being built out as rentals. I can't decide how I really feel about it, but it feels like a possible shift in the future of homeownership and the "American Dream".

This is one of the major players in that field, they have a couple subdivisions here in CO, and many more in other metros.
https://communities.ah4r.com/

[TakeFive]

Originally Posted by EngiNerd

The new fun thing that I hadn't seen before is now entire single family subdivisions are being built out as rentals. I can't decide how I really feel about it, but it feels like a possible shift in the future of homeownership and the "American Dream".

This is one of the major players in that field, they have a couple subdivisions here in CO, and many more in other metros.
https://communities.ah4r.com/

I see this as just one more opportunity to meet housing needs. It sort of meets the missing middle demand. I see where Monfort Companies’ is building townhomes, not SFH's, in Greeley but it similarly meets this market need.

One thing we learned from the COVID-2020 period is all of a sudden people decided they wanted their own home, with a backyard etc. The single family home market is the segment that's most under-supplied but lots of people are happy to rent as apposed to buying. If you're a family with young kids having that green space for kids to play and get their exercise is a godsend.

Those American Homes communities are nice! 1,800 - ~2,000 Sq Ft and nice amenities.

Oddly, I happen to recall how I'll occasionally read about a house fire where the Red Cross will show up to help the 14 people that were displaced. In some cultures it's not unusual for different families to share the same home. I think some people volunteer to host 'new arrivals' as they transition into finding jobs and eventually their own place to live. While it may seem strange to 'us' it does show how people find a way to survive and many times thrive.

There's the Sam Hill's who love living close to downtown. But among the over 2,850,000 people who live in the metro area most of them have no desire (or need) to live near downtown. The more housing available the better and rent-to-own is just more opportunity for people to live somewhere.

[TakeFive]

Does anybody know anybody who lives in Central Park?

https://www.cpr.org/2022/07/29/rtd-free-fare-august-tips/

And while RTD’s own history suggests that free transit won’t be a cure-all ... backers of the initiative hope free fares will attract new riders like David Bledsoe of Denver’s Central Park neighborhood. He recently started a new job that’s a 45-minute drive away in the south metro and plans on taking the R Line to the office next week.

“The time frame, obviously, is probably not going to be less,” he said of the train ride. “But if it’s enough of a benefit to me I might consider doing that on a more regular basis — even past the free-fare [month].”

---------------------------------------

I recall that timing

Originally Posted by laniroj

Carmel was also one of the most prominent/active multifamily developers in CO throughout the 80's/90's/00's before selling the whole enchilada after the great recession - while I'm sure it worked for them, it was perhaps the most ill-timed portfolio sale in a generation. Had they waited just a year or two, they would have seen a hugely significant increase in sale prices. I believe they still hold significant amounts of buildable land in CO and if they pressed the gas pedal, could probably build significant multifamily for several years before running out of land. Your guess is as good as mine as to why they haven't/aren't.

But when Papa dies then all the kids want their share of the inheritance.

[COtoOC]

Originally Posted by TakeFive

Does anybody know anybody who lives in Central Park?

https://www.cpr.org/2022/07/29/rtd-free-fare-august-tips/


---------------------------------------

I recall that timing


But when Papa dies then all the kids want their share of the inheritance.

I live in Central Park. I've taken the R line to work in the past (down to Lone Tree) and it's slow. But free would be an incentive since it would save me money. However, I'm on perm. WFH now.

I like to take the A line to downtown and DIA, but am now hesitant considering the CP Station park and ride is a common place to have your Cat. converter or entire vehicle stolen. It's probably a 25 min. walk from my house to the train, so now it's to the point where Uber/Lyft is the best option to get downtown. Until they can make the parking lot safe, I doubt any incentive would get me back on the train, unfortunately.