DENVER | Main Development Thread #7

[TakeFive]

An historical renovation that only construction nerds could love


A ten person placement crew was required to move and modify the slickline during the concrete placements that were sometimes over 200 FT from the pump truck and snaked through the sub-basement structure.

Resourceful Construction Innovation: The Intricacies of the Colorado State Capitol Subbasement Repair Project
November 15, 2022 - Mile High CRE

The main scope of work included repairing and replacing the plumbing and subbasement systems in the Colorado State Capitol. Additional scope items included steam piping, condensate piping, domestic hot and cold water, sanitary sewer, storm sewer, chilled water supply and return, fire sprinkler lines, control wiring and voice data lines.

The project required the construction team to hand-excavate 1,200 cubic yards of dirt in the confined subbasement of a 128-year-old building to set the foundation for the future modernization of Colorado’s legislative branch.

In addition, the project team self-performed most of the project scope, which included: steam piping, condensate piping, domestic hot and cold water, sanitary and storm sewer, chilled water supply and returns, as well as all concrete and excavation work.

FUN READ

[Robert.hampton]

Mill Creek with foundation permits for a smaller project at 16th and Pearl - anyone know what this thing is going to look like? This thing was originally going to be a self-storage center (which most of you were stoked about!) before Mill Creek bought the land.

[wong21fr]

Originally Posted by Robert.hampton

Mill Creek with foundation permits for a smaller project at 16th and Pearl - anyone know what this thing is going to look like? This thing was originally going to be a self-storage center (which most of you were stoked about!) before Mill Creek bought the land.

Ehhhh. Storage for stuff versus storage for single-something peeps. What's the difference?


Modera Uptown by on Flickr

Here's the rendering from the urban design review packet. White, brown, and dark brick. Lobby, no retail. Parking below grade.

Nice sidewalks. City won't have to spend any of the sidewalk money on these. Ol' Ma and Pa in Bear Valley can be happy with that.

[Robert.hampton]

Originally Posted by wong21fr

Nice sidewalks. City won't have to spend any of the sidewalk money on these. Ol' Ma and Pa in Bear Valley can be happy with that.

That's fantastic - even with brand new sidewalks paid by the developer, the city will still rake in about $0.12 per year from each of those residents to fix sidewalks across the city

Anyone know when we can expect the first sidewalk repair from the city from the ballot intiative?

[laniroj]

Originally Posted by TakeFive

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

Decided to do a little digging...

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

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.

Most bank financed construction money is tied to an overnight index rate. That rate would have been close to 0% (not including spread) as recently as March 2022. Those rates are now in the high 3% range and climbing. This adds several percentage points to total deal cost (they likely weren't anticipating) and is most likely way in excess of any contingency at the deal level. Most loans will have a 6 or 12 month extension option, but not longer because that costs more money on origination or spread. Pretty serious probem!

[rds70]

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.

The Evans East project has the building permit approved. It is just waiting to be issued. Hopefully, Quarterra (LMC) will pull it soon.

[wong21fr]

Originally Posted by Robert.hampton

That's fantastic - even with brand new sidewalks paid by the developer, the city will still rake in about $0.12 per year from each of those residents to fix sidewalks across the city

Anyone know when we can expect the first sidewalk repair from the city from the ballot intiative?

Knowing the city: 2032.

[TakeFive]

Originally Posted by wong21fr

Knowing the city: 2032.

Denver7 has a decent article on the topic.

First, they have to wait 6 months for review of potential changes before city council can act.

There's also this:

First, though, it will be up to the Denver Department of Transportation to work with a citizen oversight board on an implementation plan. They will then present their final plan to city council for approval.

[BG918]

Originally Posted by laniroj

Most bank financed construction money is tied to an overnight index rate. That rate would have been close to 0% (not including spread) as recently as March 2022. Those rates are now in the high 3% range and climbing. This adds several percentage points to total deal cost (they likely weren't anticipating) and is most likely way in excess of any contingency at the deal level. Most loans will have a 6 or 12 month extension option, but not longer because that costs more money on origination or spread. Pretty serious probem!

I would expect this puts many projects on hold that are not already under construction. Some of the better financed ones will still plow forward but I’m afraid the boom is coming to an end. It was an historically good run.

[TakeFive]

There's the BG918 we remember and love

Originally Posted by BG918

I would expect this puts many projects on hold that are not already under construction. Some of the better financed ones will still plow forward but I’m afraid the boom is coming to an end. It was an historically good run.

It's also fair to say that you are in good company at this point.

Top economist Mohamed El-Erian says we’re not just headed for another recession, but a ‘profound economic and financial shift’
Wed, November 23, 2022 By Alena Botros - Fortune via Yahoo!

There’s a tendency to see economic challenges as “temporary and quickly reversible,” El-Erian wrote in a commentary for Foreign Affairs ... “The world isn’t just teetering on the brink of another recession,” he continued. “It is in the midst of a profound economic and financial shift.” He highlighted three trends that suggest a transformation in the global economy is under way.

The first transformational trend, El-Erian says, is the shift from insufficient demand to insufficient supply. The second is the end of boundless liquidity from central banks. And the third is the growing fragility of financial markets.

I also would agree that certain players and projects will "plow forward." Here's to hoping that rds70 is right about "Quarterra."

Originally Posted by rds70

The Evans East project has the building permit approved. It is just waiting to be issued. Hopefully, Quarterra (LMC) will pull it soon.

LMC Rebrands to Quarterra Multifamily

CHARLOTTE, N.C. – July 29, 2022 – LMC, a subsidiary of Lennar Corporation and a vertically integrated multifamily apartment builder, developer, and asset manager, today announced it has finalized the rebrand to Quarterra Multifamily. As previously announced, Quarterra Group, Inc., a wholly owned subsidiary of Lennar and the parent Company of Quarterra Multifamily, is expected to complete its spin-off from Lennar later this year.

All communities previously under LMC will now be under the Quarterra Multifamily portfolio. The rebrand includes a new logo, company website, and social media channels. “Our rebranding is an important first step as we prepare to separate from Lennar and launch Quarterra as an independent, NYSE listed, Alternative Asset Manager.

[TakeFive]

It's still easy to argue for Denver's continued survival

It's all about dem bones

Denver International Airport

Easy to overlook and underestimate but DEN is still the most important infrastructure in the metro area. It's currently ranked the 3rd busiest airport behind only ATL and DFW. And it's not gathering dust and rust but has been expanded and is being updated and refreshed. How timely was the decision for this?

Transit

While currently a bit of a dumpster fire I still believe in the ultimate value of the light & commuter rail system, even if it takes another decade to prove. But there's no arguing the immense investment in TOD.

Props to RTD and partly thanks to the Infrastructure Bill they are curing all the deferred maintenance unlike many of the larger legacy systems which have continued to defer needed maintenance in favor of service - except where the FTA has stepped in to force them to upgrade their infrastructure.


With respect to the City's bones

How fortuitous, in hindsight, was the two bond issues totaling roughly $1.3 billion. Since the $937 million Elevate Denver Bond Program was approved in 2017 a lot of projects have already been completed while many others are under construction.

The economy stupid

While seen locally as not very affordable it's still significantly more affordable than west coastal cities including semi-peer city Seattle. While significantly tech-driven in recent years Denver still benefits from a very diverse economy.

Speaking of tech, the industry has lost $7.4 trillion in stock market cap value this year. As previously suggested I don't see tech being the same economic driver it has been, not that it isn't still important.

All that cheap land in the city center

A lot of the TOD areas started out as reclaimed brown fields. Include RiNo where many bought land starting (over) a decade ago when it was still dirt cheap.

Politics is always important

While Denver/metro is not as business friendly as it once was it's not terrible. What happens going forward will be a key, especially if the economy stagnates.

[TakeFive]

Denver don't need no stinkin' supertalls to be Super Cool

What block in downtown Denver would this look good on?


Credit: HKS

https://www.cnn.com/style/article/supertall-skyscraper-austin-texas-wilson-tower/index.html

There's a well-known saying that everything is bigger in Texas. But so far, that hasn't been the case for the state capital's skyline.That could change soon, said Brad Wilkins of architecture firm HKS, during an interview with CNN.

Wilkins has worked on some of the world's tallest buildings — including Dubai's Burj Khalifa and the Wuhan Greenland Center in China — and he's the principal and design director behind Wilson Tower, an 80-story, 1,035-foot residential skyscraper planned for Austin, Texas.

The 450 residential units in the building will range from studios to three and four-bedroom penthouses. Developers say plans include four floors of amenities for residents, including a cocktail lounge, movie theater, coworking spaces and a floor dedicated to pets.

[i4isoar]

Originally Posted by TakeFive

Denver don't need no stinkin' supertalls to be Super Cool

What block in downtown Denver would this look good on?

That would probably look good on that gigantic parking lot between 19th, 20th, Broadway, and Grant. On the other hand, instead of a single supertall, maybe a complex of 4 separate-but-connected towers like the Four in Frankfurt would be better for that spot.

On a related note, I actually think that the 6X Guadalupe in Austin would be the perfect skyscraper for Denver. Not quite a supertall, but still something in the 850' - 900' range, and I do like the look of it.

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

Not related, but since I haven't posted in a while: love the look of 2091 Lawrence St.! What I like most about it is how it "pulls" the skyline north, together with the X2 (while the Bell Tower "pulls" it west and the proposed tower on Bannock "pulls" it south). This would be a good companion to 1900 Lawrence.

[rds70]

1201 Cherokee Street (19 stories, +/- 180 units, 4,400 sf of retail, 248 feet in height). The project is in design review.

The architect is Carvell Architects, who also designed the 1245 Cherokee building directly to the north and shown in the renderings (17 stories, 254 units). That building has been approved, but no building permits submitted yet.

[Agent Orange]

Great to see a more vertical tower in GT. The barge shaped buildings going up down there are a bit imposing and monotonous. Hopefully the new zoning there results in more point towers and we see the skyline stretch out further south.

[Denver]

Originally Posted by rds70

1201 Cherokee Street (19 stories, +/- 180 units, 4,400 sf of retail, 248 feet in height). The project is in design review.

The architect is Carvell Architects, who also designed the 1245 Cherokee building directly to the north and shown in the renderings (17 stories, 254 units). That building has been approved, but no building permits submitted yet.

Do not get your hopes up on this. The site is owned by a land-banker (you all know his name) and is currently on the market. I have spoken with the broker and they are trying to sell the site fully entitled with the development plans.

[TakeFive]

Originally Posted by Denver

Do not get your hopes up on this. The site is owned by a land-banker (you all know his name) and is currently on the market. I have spoken with the broker and they are trying to sell the site fully entitled with the development plans.

That did cross my mind.

My guess is that the site is under contract by a prospective developer who now wants to explore re-selling the site (possibly flipping it at land closing) along with current entitlements.

[SirLucasTheGreat]

How likely is 1235 Cherokee to moving forward? Seems like that has been near the start line for a little bit

[Denver]

Originally Posted by TakeFive

That did cross my mind.

My guess is that the site is under contract by a prospective developer who now wants to explore re-selling the site (possibly flipping it at land closing) along with current entitlements.

No. The site is being sold with the plans. There is no developer involved.

[TakeFive]

I gotta say this is real darn interesting

Originally Posted by Denver

No. The site is being sold with the plans. There is no developer involved.

and it illuminates yet another good reason why DenverInfilll's Roundups are so dang useful. After reviewing the GT Roundup I see where the developer of "13th and Cherokee" is listed as "TBD". I recalled seeing that previously but didn't give it much thought at the time.

The only other instance where I can recall something similar is at 600 Park Avenue by Greystar. The original investor/purchaser of the land was from K.C. (and I think they did the entitlements) ended up selling the site to Greystar - although they retained an equity interest in the project.