February-March 2013   

The Regional Transportation District (RTD)'s West Rail Line project has been named one of the most significant construction projects of 2012 by the Associated General Contractors of America (AGC).  The AGC presented its Alliant Build America Merit Awards during the association's annual convention in Palm Springs.  The awards are considered by many to be the most prestigious recognition of construction accomplishments in the U.S.  AGC noted that the West Rail Line project was completed eight months ahead of schedule and on budget, thanks to the construction team's commitment to innovation and ingenuity.  The line travels through three cities, which required intergovernmental agreements.  Denver Transit Construction Group, the project's civil contractor, built 13 bridges, two tunnels, 12 stations and 12 miles of light rail as well as managed numerous challenges related to relocating utilities and property acquisition.

The Regional Transportation District (RTD) has received a confidential unsolicited proposal for the North Metro Rail Project, part of RTD's FasTracks program.  The proposal was submitted by a team led by Graham Contracting Limited. RTD staff is conducting a comprehensive evaluation of the proposal consistent with the agency's Unsolicited Proposals Policy to see if the proposal has merit.  If so, RTD will then pursue a competitive procurement process and release a Request for Proposals (RFP) for competing proposals, consistent with RTD's policy and previous announcement to release an RFP later this year.

In January, RTD announced it would release an RFP later this year to build North Metro up to 72nd by refinancing some of agency's debt, issuing new sales tax bonds and using available local funds.  So, whether through RTD's initial plan or this unsolicited proposal process, RTD plans to release an RFP for the North Metro Line this year.  The North Metro project is an 18.4-mile electrified commuter rail line that will connect Denver and Adams County by serving Commerce City, Northglenn and Thornton.

Over the past few years, RTD has been very public with its "call for innovation" to the private sector asking for solutions to help RTD complete the partially funded FasTracks projects as soon as possible.  This was the premise behind RTD's first industry forum called, Transformation Through Transportation, which was held Tuesday, Sept. 27, 2011.  In March 2012, RTD received an unsolicited proposal from Kiewit Infrastructure Company for the I-225 Rail Project.  After a competitive process, Kiewit was awarded a contract to design and build the whole line by the end of 2015 and construction started a few weeks ago with opening scheduled in 2016.  Here is a link to two videos with updates of the FasTracks project.

http://www.rtd-fastracks.com/main_7

Last week, the U.S. Congress passed budget-related legislation that returns the public transit commuter benefit for 2013 to up to $240 per individual per month.  The benefit for commuting employees had been reduced to $125 for 2012, but this recently passed increase now provides equal tax benefits to public transit riders, and those who drive to work.  The public transit commuter benefit is an IRS-qualified employment benefit, and may be utilized by employers as a "fringe benefit" to their employees who want to encourage public transit as part of their daily commute.  Participating employees benefit from decreased commuting costs, by being reimbursed through pre-tax dollars to pay for their commute to and from their workplace.

RTD and Transportation Solutions, the Cherry Creek based transportation management association are in the process of engaging Transportation Management and Design, Inc. a Carlsbad, California based transit consul;ting firm to conduct a Denver Union Station/Cherry Creek/Glendale Corridor Feasibility Study. The purpose of the study is primarily to determine the non-commuter market potential for transit services in the corridor connecting Denver Union Station, the Cherry Creek area and City of Glendale and what transit services and enhancements would be feasible to meet this need in combination with commuter needs. This study should provide stakeholders with a better understanding of transportation options and improvements and potential for public/private partnership in the corridor. Key stakeholders to be involved in the feasibility study are:

•         The City and County of Denver
•         The City of Glendale
•         Transportation Solutions (TMA)
•         Cherry Creek Steering Committee
•         Cherry Creek Area Business Alliance
•         Capitol Hill United Neighbors and other impacted RNOs
•         Visit Denver
•         The Arts District 

Here is a link to an update of major transit oriented developments in the Denver area at Transit Oriented Development: Understanding TODs in the Denver Metro Area at the Law Corner produced by NAIOP Colorado and the law firm of Kaplan Kirsch & Rockwell:

https://www.naiop-colorado.org/LegislativeAdvocacy/LawCorner.aspx

Mayor Michael Hancock recently proposed strategic investments in six downtown Denver projects that could bring new vitality to the city's core and generate significant revenue.  The Mayor requested that the Denver Urban Renewal Authority leave the existing tax increment financing area open in downtown until its expiration and invest the funds in several projects poised to have a transformational impact on Denver.  The majority of the tax increment expires in 2017 and is projected to total $60-$70 million.  In a letter submitted to DURA yesterday, Mayor Hancock proposed adding the following projects to the Downtown Urban Renewal Plan:

• Bring a public school into downtown.
• Rebuild and enhancing the 16th Street Mall to ensure sustainable growth.
• Bring to downtown additional parking and a grocery store to serve community needs.
• Develop a new downtown park to support the vision of the Downtown Master Plan.
• Bring to downtown a large retail store.
• Address homeless facility needs in the downtown area. 

The Mayor recently released a strategic blueprint for driving more than 100,000 jobs, generating $5.4 billion of economic benefit, and transforming the Denver metro region for decades to come through intentional development of three primary areas, including downtown.  Next, the Mayor's proposal will go to the DURA board and the Denver City Council for review.

George Thorn and partners Buzz and Carl Koelbel broke ground on another affordable senior apartment project at RTD's University of Denver Station following their successful project at Yale Station.  The 60-unit 6-story building is under construction on a site which Thorn purchased from RTD and Denver many years ago.  Thorn discovered that RTD's enabling legislation required an amendment by the legislature before the site could be used for residential.  After surmounting that hurdle, Thorn pioneered a new concept with RTD allowing shared use of the RTD parking structure by apartment renters and commuters.

In the Denver Business Journal, Dennis Huspeni reports that Glendale strip club Shotgun Willie's is moving into the parking lot adjoining the existing building, at 490 S. Colorado Blvd.  Construction has started on the new, $3 million to $4 million building.  Shotgun Willie's, which will stay open during the nine-month construction period, has been on the corner of Colorado Boulevard and East Virginia Avenue since 1982.  The owners are adding two bars, offices and a tower to the new 10,800-square-foot building.  The existing building is about 7,000 square feet.

The City of Denver has announced a new bike lane will be installed along 15th Street allowing bicycles a route through the central business district connecting Capitol Hill with the Highlands.  Patterned plastic material will highlight boundaries between bikes on the left side of the one-way street northwest-bound and bikes will be allocated a "bike box" or staging area at the Cleveland Street traffic signal and a "queue jump" allowing bikes a head start allowing bikes to cross in front of traffic at Lawrence Street.

Legacy Partners plans to begin construction on 21 Lawrence, a 212-unit apartment building at 2151 Lawrence Street near Coors Field in downtown Denver.  The company's partner on the project is Behringer Harvard Multifamily REIT.  Construction is expected to be finished in the fall of 2014. 

JBK Hotels announced plans to develop a 140-room Aloft Hotel in downtown Denver.  The 6-story building will be located at 800 15th Street, about a block from the Colorado Convention Center.  A site plan has been filed with City & County of Denver planners.  The Aloft concept is a brand of Starwood Hotels. 

Site work began on 1650 Wewatta Street, a 288-unit apartment building adjacent to Union Station in downtown Denver.  The 21-story building is being developed by Holland Partners in the Riverfront neighborhood immediately west of the historic deport, which is being restored and redeveloped as the centerpiece of Denver's RTD and Amtrak transportation system

The University of the Rockies will open a Denver campus at the Tabor Center downtown.  The Colorado Springs-based for-profit educational company leased 30,000 square feet in the building at 17th and Arapahoe streets

Lincoln Property Company and ABS Capital Management bought the Hardware Block, three connected historic buildings at 1515 Wazee Street in Lower Downtown. The 118-year old buildings contain about 52,215 square feet and are fully leased to retail tenants on the ground floor and to office users on the other three floors. LPC and ABS paid $16.3 million (or about $312 per square foot) for the property, acquiring it from Evaluation Development Group.

The World Trade Center office buildings in downtown Denver have been put on the market for sale. LaSalle Investment Management of Chicago bought the 770,000 square foot, two-building complex, in 2008 for $157.8 million.  The buildings at 1625 and 1675 Broadway were built in 1979 and 1980 and are currently 95% occupied. Cushman & Wakefield of Colorado brokers Tim Richey and Mike Winn, who brokered the sale to LaSalle in 2008, are representing the seller. 

Johns Manville Corporation renewed the lease for its headquarters in downtown Denver.  The company signed a twelve-year lease for 118,865 square feet in the building that bears its name at 717 17th Street. And the owner of the Johns Manville office building at 707 17th Street (MS Crescent Two SPV LLC) was recently represented by Bruce M. Basham of Crescent Real Estate Holdings in the signing of 5 office leases for the building.  Respectively represented by Joe Sigdestad of Cassidy Turley Colorado, Anthony Albanese and Hadley Cox of CBRE, and Jim Ransom of Newmark Grubb Knight Frank, leases were signed by Broadridge Financial for 23,773 SF, Calfrac for 6,090 SF and Cunningham Financial for 18,314 SF.  Baker Hughes also leased space at the property totaling 42,814 SF, and Concord Energy renewed and expanded its leased space at the building to 6,162 SF.

Nichols Partnership is entering into a partnership with a South Carolina firm to develop the mixed-use apartment and retail complex near Union Station in downtown Denver.  The project will be located on Chestnut Place between 19th and 20th streets. It will contain 312 apartment units and about 58,000 square feet of retail space, including a 47,000 square foot King Soopers "Fresh Fare" supermarket.  Greystar Real Estate, based in Charleston, will manage the construction of the apartments.  Steve O'Dell of ARA Colorado brokered the deal between Nichols and Greystar. 

Kreshner Capital bought five retail condominiums on Wynkoop Street in LoDo across from Denver Union Station.  The investment firm paid $7,150,000 for the space, which totals 22,236 square feet and is contained on the ground floor of the Streetcar Stables building at 1710 Wynkoop Street. The residential condominiums above the retail space are not included in the sale.  Morton's the zteakhouse is one of the tenants in the space. The purchase price equates to about $322 per square foot.

The recent exchange of the Commons Park West apartment complex between seller JPMorgan Chase and buyer Heitman Financial Ltd. managed to set a new per SF record sale price in Colorado. Located at 1550 Platte Street, the 337-unit property was exchanged for $98.7 million, or $246/SF or $291,000/unit.  The transaction was managed on behalf of the seller by Pam Koster and David Martin of Mountain States Moran and Co.

Woodspear Properties bought Sleek Lofts, a 60-unit apartment building at 770 Grant Street in Capitol Hill.  The seller was Brasiland LLC. The purchase price was $8.1 million, or $135,000 per unit. James Lorenzen of Cornerstone Apartment Services represented the buyer.

Denver Public Schools bought a vacant office building at 1860 Lincoln Street in downtown Denver.  The school district will use the 338,892 square foot building as its headquarters and to also provide space for some educational facilities, including the Emily Griffith School.  DPS acquired the building from East Pioneer/Arcus LLC for $19,340,000, or about $57 per square foot.  Newmark Grubb Knight Frank brokers Jamie Gard and Tom Wooten represented DPS. 

Sports Authority Field at Mile High Stadium will receive at $30 million upgrade. Improvements to the home stadium of the Denver Broncos will include a new LED scoreboard on the south end of the field along with the addition of video monitors and new windows in the suites that surround the field. Mile High Stadium is located west of downtown Denver on West Colfax Avenue at Federal Boulevard. 

The University of Colorado at Denver will begin construction shortly on a $60 million academic and office building on the Auraria high education campus in downtown Denver.  The 146,000 square foot building will be constructed on what is now a parking lot on Speer Boulevard between Auraria Parkway and Larimer Street. 

Simpson Housing plans to develop Walnut Flats, a 165-unit apartment building in the River North/Ball Park neighborhood near downtown Denver. The project will be located at the northwest corner of 27th and Walnut streets. Construction is expected to begin in the spring. 

A 34,608 square foot industrial building in north Denver was acquired for $720,000 from James R. Parrish.  The building at 3801 Race Street sold to 3801 Race Street LLC. The seller was represented by Cassidy Turley brokers Alex Rhodes, Tyler Smith and Aaron Valdez.

The Colorado Coalition for the Homeless plans to start construction shortly on Renaissance Stout Street Lofts, a 78-unit building on Stout Street between 21st and 22nd streets in the Arapahoe Square neighborhood north of downtown.

As part of its recently approved 250 Columbine Street project in Cherry Creek North, Western Development Group will construct 70 condominium units.  The $100 million mixed-use project will also contain office and retail space. Construction is expected to being in late summer.  Western has yet to set sale prices but they are likely to average just under $500 per square foot. The project will occupy a half-block on the east side of Columbine Street between East 2nd and East 3rd avenues.  

The Denver City Council unanimously approved plans for a 90,000 square foot, seven-story office and retail building in Cherry Creek North.  The building at 245 Columbine Street will replace the derelict Case Building which formerly housed the US Post Office and has been vacant for years.  Jim Sullivan is the developer of the project. 

The headquarters of Janus Capital Group was acquired by an unidentified investor for an undisclosed price.  The 160,354 square foot building is located at East First Avenue and Detroit Street in Cherry Creek North.  It was constructed in 2003. The broker on the acquisition was Mike Winn of Cushman Wakefield of Colorado.  Seller was a fund managed by GE Asset Management.  

Unico Properties bought Denver Centerpoint I, a 168,000 square foor office tower at 3900 East Mexico Avenue in south Denver, adjacent to the Denver Centerpoint II building which it acquired in 2006.  Unico reportedly paid $11,750,000 for the 14-story building, acquiring it from an Integrated Properties entity. The purchase price equates to approximately $70 per square foot.  Unico plans to spend about $6.3 million to upgrade the 32-year old structure.  Brokers involved in the transaction were Mike Winn, Tim Richey and Chad Flynn of Cushmand&Wakefield of Colorado. 

The non-profit Urban Land Conservancy bought a 9.4 acre site at Smith Road and Colorado Boulevard near a planned rail station on RTD's east line between Denver International Airport and Union Station.  Construction of the 156 unit Park Hill Village West will be partially funded through Denver's Transit-Oriented Development Fund.

Quebec Hospitality LLC bought a 138-room Comfort Inn at 4685 Quebec Street in east Denver.  The purchase price was $3,620,000, or $26,232 per room. Creative Hotel Investors LLC sold the property.  Broker for the acquisition was Larry Kaplan of CBRE Hotels.

The Zeppelin Company started work on The Source, a 26,000 square foot specialty retail building at 3350 Brighton Boulevard in the River North (RiNo) neighborhood. Zeppelin is renovating an 1880s-era foundry into restaurant and specialty retail space. The building is scheduled to open in June.

Fuqua Development plans to start demolition on some of the buildings at the former University of Colorado Medical Center site.  The Atlanta-based firm was selected by CU to redevelop the 28-acre site on Colorado Boulevard between East 9th and East 11th avenues after the hospital and medical school moved to the Fitzsimons medical campus in Aurora. Fuqua initially announced Wal-Mart as an anchor tenant for retail space in the mixed-use project but neighborhood opposition to that business resulted in the replacement with a King Soopers market.  The project will ultimately include a hotel and multi-family units. 

Felton Properties, a Portland-based investment firm, bought Tower Colorado, an office building at 1720 South Bellaire Street.  The 15-story, 127,715 square foot building is across I-25 from the Colorado Center RTD light rail station. Felton paid $9.6 million to SM Brell II LP, or about $75 per square foot.  The seller was represented by Newmark Knight Grubb Frank broker David Tilton

Lincoln Property Company, and its capital partner ABS Capital Management, may resurrect postponed plans for a third office tower at Colorado Center, their mixed-use complex at South Colorado Boulevard and East Evans Avenue in south Denver. The property's 441,000 square feet of office space is currently 96% leased and the adjacent 121,000 square feet of retail space is fully occupied.  The concept being considered, pending preleasing, is for a 13-story, 300,000 square foot office tower and 55,000 square feet of retail space.  Colorado Center is adjacent to an RTD light rail station, a situation LPC considers a leasing asset.

A price of $3.98 million was paid by 5200 East Evans SP LLC to 5200 East Evans Holdings LLC for the 74,462 SF industrial building at 5200 East Evans Avenue in Denver.  The property was sold via Newmark Knight Frank Frederick Ross agents Mike Wafer and Tim DAngelo.

Greenbox III LLC, an affiliate of Denver-based Focus Property Group, bought a 131,245 square foot industrial building in south Denver.  The building at 1385-1393 South Santa Fe Drive will be configured for 65,000 square feet of self-storage space on the first floor.  Seller David Nestor of Urban Lights will retain his lighting business on the second floor.  The purchase price was $5,310,000, or $40.45 per square foot. Nestor was represented by Tyler Smith, Alec Rhodes and Aaron Valdez of Cassidy Turley Colorado.

The 4-star Loews Denver Hotel at the edge of Glendale and the Cherry Creek shopping district was recently purchased for $11.2 million, or $61,202/room, by the HP Denver Hotel Owner LLC.  Located at 4150 East Mississippi Avenue, the new owners are to close and begin extensive renovations of the 11-story, 183-room hotel at the end of February so that it can reopen as a Hyatt Place.