DENVER | Main Development Thread #7

[TakeFive]

Study would look at feasibility of converting downtown Denver office buildings into housing
September 29, 2022 By Luis de Leon - 9News Denver

DENVER — A study proposed in Denver's 2023 budget would examine certain downtown Denver office buildings and look at how feasible it would be to convert them to housing.

The plan is part of a larger adaptive reuse program the city's Community Planning and Development team is playing a big role in.

Why they do this?

"Since the pandemic, the downtown has really suffered from vibrancy because a lot of people are now either working from home full time or they have a hybrid work environment," Adaptive Reuse Senior Project Development Administrator Jenny Buddenborg said.

"But the vast majority of them that we're looking at have less than 50% occupancy at this time, and some of them 0% occupancy," she said. "So we're talking a very high vacancy rate with these buildings."

It's all about downtown!

"But we are really focusing on the central business district core and creating a real vibrant 24/7 neighborhood where we have people living down there, we have people working down there, and we really do have a complete neighborhood," she said. "Housing is a really important piece of that."

Denver City Council needs to approve the $75,000 appropriation as a part of next year's budget in November.

She said if approved, the study would specifically look at the feasibility of reusing 10 to 15 high-rise office buildings downtown.

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

Originally Posted by wong21fr

I do think that the city should be doing a lot more to encourage the conversion of Class B and C office space to residential anywhere possible. Calgary's Development Incentive Program is the first thing that comes to mind:

https://www.calgary.ca/development/downtown-incentive.html?redirect=/downtownincentives

I didn't read specifically about how Calgary is doing their incentive program.

But for over a decade, Phoenix has been using tax incentives for developers of "new" high-rise buildings in downtown Phoenix. While some have bemoaned the 'subsidy' it's what Phoenix needed to do to compete with Scottsdale and Tempe and it's been a huge success for construction of new apartment towers.

[rds70]

The foundation permit for Kenect Denver was approved on November 5th.

What are the chances it actually starts construction?

[TakeFive]

Originally Posted by rds70

The foundation permit for Kenect Denver was approved on November 5th.

What are the chances it actually starts construction?

[TakeFive]

We're Back in Town

$90 million apartment project breaking ground near Broncos stadium
Nov 14, 2022 By Kate Tracy – Reporter Denver Business Journal



A ground-breaking for November just arrived

Atlanta-based developer is breaking ground tomorrow on a $90 million multifamily project across from Empower Field at Mile High. Wood Partners has secured its final permits from the city to begin
construction on Alta Mile High, an apartment community that it’s building on vacant land at 1450 Morrison Road, directly south of West Colfax Avenue.

Wood Partners purchased the 1.3-acre parcel last December for $6.25 million, according to property records. The seller was Dave Keefe, owner of the long-standing pub The Original Brooklyn’s,
located adjacent to the property.

Renderings courtesy of Studio PBA

The seven-story apartment building will include 216 residential units, ranging from studios to three-bedroom layouts. In addition, the building will include two stories of structured parking with 199
parking spaces. Future rent will range between $1,500 for a studio and $3,200 for a three-bedroom unit.

Max Muller, vice president at Wood Partners, said the site was attractive to the firm due to its proximity to the Broncos stadium. “We're always going to have tenants who are Broncos season ticket
holders that love the team and they want to be there for the 12 days out of the year that they can go to the game,” Muller said.

Go back 5 to 10 years and Wood Partners was quite active in the Denver area. Then they moved on to other places (like Phoenix).

[laniroj]

Originally Posted by TakeFive

...September 29, 2022 By Luis de Leon - 9News Denver

Why they do this?

It's all about downtown!

Denver City Council needs to approve the $75,000 appropriation as a part of next year's budget in November...

Wait, so would the CITY be picking the buildings eligible for Denver? That would seem a bit of a farce and waste of time. Great idea for a program though and just the kind of thing needed to revitalize vacant buildings, you know in lieu of our local DURA taking an active role which they've not really done in the past 15 years at any meaningful scale. I could totally see this being a viable development path of family sized units, provided the City changed it's code to allow for interior bedrooms to count...

Hopefully Denver considers this and doesn't put such a small cap like Calgary did. $10 million on a 300,000+ SF building is not nearly enough to move the needle. I'd rather see less projects get done with greater resource than see the City waste it's time on small efforts which can actually benefit from a small cap like Calgary's

[TakeFive]

I was thinking about this
(and it didn't give me a headache)

Originally Posted by rds70

The foundation permit for Kenect Denver was approved on November 5th.

What are the chances it actually starts construction?

I recall that Kenect Phoenix jumped ahead of Denver presumably due to ease of permitting and getting going. This project and a couple of others then had to suffer through the Pandemic Blues. IIRC, the Phoenix project was in their completing phase.

Fast forward and we can assume their projects are now stabilized and doing well. One advantage they did have is their projects were (mostly) completed prior to the pandemic so they didn't suffer supply or inflation issues.

That likely means that their Denver site is next to move forward. Given their size they likely rely on capital markets but they should be well positioned for getting the needed funding.

How cool would it be if both Kenect and Evolve Towers broke ground next year?

[TakeFive]

Koelbel and Company Announce Groundbreaking of New Multifamily Project
November 15, 2022 - Mile High CRE


Rendering of Tempo Nine Mile, courtesy of KTGY.

Not only is this exciting new project in Aurora but it's a TOD project

Tempo Nine Mile, a new 255-unit market-rate multifamily project — part of the 22-acre The Point at Nine Mile master plan — has broken ground at the northeast corner of Parker Road and Peoria Street in Aurora. The project is a joint venture between Draper and Kramer, Koelbel and Company, Mile High Development, and Urban Roots Development, Inc., ...

The new 5-story building will include a mix of one- to three-bedroom units, ranging in size from 542 to 1,321 square feet, and 3,000 square feet of ground floor retail. Tempo Nine Mile is located adjacent to the future pedestrian bridge that will connect The Point at Nine Mile to the Regional Transportation District (RTD)’s Nine Mile Station and the Cherry Creek Reservoir.

More Chicago investment in Denver area

“As we continue to expand our firm’s national footprint, we are focused on opportunities presented by dynamic metro areas like Denver that demonstrate robust growth metrics and high demand for quality rental options,” said Todd Bancroft, president and CEO of Chicago-based Draper and Kramer.

[rds70]

2091 Lawrence Street - 37 stories, 500 +/- units, 7,500 +/- square feet of retail, 390 +/- feet in height:













The developer is CMK Companies based in Chicago. The architect is Gensler.

The massing and design review goes before the Downtown Design Advisory Board on November 22nd. Staff is recommending approval of the project.

[SirLucasTheGreat]

Man that's a beast. I was just in Austin and that looks like something I'd see there. Hope it gets built!

[TakeFive]

Let's speculate

Originally Posted by rds70

2091 Lawrence Street - 37 stories, 500 +/- units, 7,500 +/- square feet of retail, 390 +/- feet in height:

The developer is CMK Companies based in Chicago. The architect is Gensler.

The massing and design review goes before the Downtown Design Advisory Board on November 22nd. Staff is recommending approval of the project.

Feels like foreign money for starters. I previously found potential links to China. While the current Chinese RE market is a bit shaky, no doubt $billions have been made over the years. It's not illogical that money has been stashed offshore. If you're a RE developer why not convert cash to RE somewhere that would be safe. For example lots of money has flowed from So America into Miami RE.

I found one thing from CMK Companies website that piqued my interest. They have an exclusive Caribbean development on an island owned by the UK. Click here. There's these bullet points:

• Stable environment (British territory, stable political system, and trusted legal system)
• British Crown guarantees Absolute Title through a land registration process, making title insurance unnecessary
• The Government Planning and Development Authority oversees all building codes and development plans to ensure the highest standards of land use and construction

At the least this would be an interesting place to meet interesting people.

Why Denver
Good question; dumb luck?

Given it's a small world, CMK would certainly be familiar with and aware of Chicago-based Golub & Company and Riverside Investments and know why they like & chose Denver for their newest projects.

[wong21fr]

Originally Posted by rds70

2091 Lawrence Street - 37 stories, 500 +/- units, 7,500 +/- square feet of retail, 390 +/- feet in height:

Beast indeed. Let's get 12 of these built downtown over the next five years. 10,000 additional downtown residents would certainly help the vitality.

[Sam Hill]

Originally Posted by rds70

2091 Lawrence Street - 37 stories, 500 +/- units, 7,500 +/- square feet of retail, 390 +/- feet in height:

Perfect location and height for broadening the skyline from certain vantage points. I’m always rooting for these skyline fatteners!

[TakeFive]

I want to say how happy I am with the investment by the Monfort Companies (Ken Monfort) in the Ball Park neighborhood.

Both Denverite and Westword carried the story at the groundbreaking of Riot House where Monfort also announced the recent purchases of the old El Chapultepec and the Giggling Grizzly buildings which they intend to combine into one venue for presumably live music.

Along with Dierks Bentley's Whiskey Row it's so important to preserve as many of these historical gems as possible. They can activate the area by adding character and vibe. While not a regular (and I may be the only one 'here') I certainly enjoyed hanging out at El Chapultepec.

https://denverite.com/2022/11/16/el-chapultepec-monfort-companies-giggling-grizzly/

In a statement, the company promised to strive to “further round out the offerings on the block and in the Ballpark neighborhood while honoring the impact and significance of El Chapultepec in Denver’s history.”

“Riot House and the forthcoming rehabilitation and amalgamation of El Chapultepec and the Giggling Grizzly will build upon the momentum prevalent in this neighborhood and ideally, catalyze continued investment here,” Monfort said. “We see investment in this neighborhood as an economic imperative that will help Denver claim its spot as a top entertainment destination nationally.”

[SirLucasTheGreat]

Here's X Denver 2. Not the most inspiring building but it is quite tall for the area

[TakeFive]

Thanks for the photo update (I don't mind the look)

Originally Posted by SirLucasTheGreat

Here's X Denver 2. Not the most inspiring building but it is quite tall for the area

Decided to do a little digging...

https://www.multihousingnews.com/the-x-co-lands-105m-loan-for-denver-project/

Multifamily investment firm, The X Co., has taken out a $105.3 million construction loan for X Denver2, a 351-unit multifamily project in downtown Denver. CIM Group provided the senior note, which carries a variable interest rate over a 3-year term, according to public records.

Maybe laniroj would have some insight as I wouldn't know what the rate is tied to or how frequently it adjusts but obviously the rate has been going higher this year. Also what provisions there may be for extensions I also wouldn't know.

Looks like the loan was taken out in November of 2020 so the due date would be November of 2023. While that may seem like plenty of time it likely means they need to be renting units about six months from now assuming it will take 6 months to lease a healthy portion of the units.

On the positive side I hear that supply chain issues are mostly resolved but can't speak to every item that would be needed.

[DenverInfill]

It is a bit drab, but that view is of the alley side. The facade facing Arapahoe does appear to have a higher percentage of glass though.

https://difcdn.denverinfill.com/wp-content/uploads/2022/09/06151049/2022-09-06_x_denver_2-14.jpg

[EngiNerd]

Shout out to Ryan for one of my favorite posts on DI in recent memory. Loved the use of the floor maps to help explain it all, you really put some extra credit into this one.

https://denverinfill.com/2022/11/inside-the-convention-center-expansion.html#

Also a project close to home as the company I work for is heavily involved in the design.

I just wish they would have redone the spiral garage ramps while they were at it. Those things are horrendous for users, so much that I know plenty of folks that refuse to park in the garage due to the ramps.

This was my favorite shot

[RyanD]

Originally Posted by EngiNerd

Shout out to Ryan for one of my favorite posts on DI in recent memory. Loved the use of the floor maps to help explain it all, you really put some extra credit into this one.

Aw thank you! It was such a great tour and I'm glad you enjoyed the post. Without the maps, everyone would be lost, including myself.

[SirLucasTheGreat]

What do you guys think is going to be the next significant project to break ground in the next few months? I know there has been some demo going on at 10th and Bannock and 8th and Broadway.

[TakeFive]

Originally Posted by SirLucasTheGreat

What do you guys think is going to be the next significant project to break ground in the next few months? I know there has been some demo going on at 10th and Bannock and 8th and Broadway.

Maybe Mill Creek in RiNo?

Which reminds that Mill Creek managed to secure a nice large site right on Scottsdale Road near Keirland Commons. It's all fenced off with their name but I've yet to see any digging. There's a number sites down here with fencing that are just sitting, waiting...

The financial markets have been on of positive tear of late - but I figure it's a dead-cat bounce. All the big tech companies are cutting their workforce, trying to save costs (so far nobody is threatening to copy Twitter). Consumers are loading up on consumer debt ie credit cards and I fear the 1st quarter may look like a bad hangover.

There's always a chance for a groundbreaking or two but it's hard to predict where they might come from.